Friday, June 27, 2008

The World's Greatest Instrument is still a Gibson Les Paul!

and not (as some would have it) settler mortality.

So says David Albouy in his new NBER working paper (which is on its second revision at the AER).

Here is the abstract:

In a seminal contribution, Acemoglu, Johnson, and Robinson (2001) argue property-rights institutions powerfully affect national income, using estimated mortality rates of early European settlers to instrument capital expropriation risk. However 36 of the 64 countries in their sample are assigned mortality rates from other countries, typically based on mistaken or conflicting evidence. Also, incomparable mortality rates from populations of laborers, bishops, and soldiers – often on campaign – are combined in a manner favoring their hypothesis. When these data issues are controlled for, the relationship between mortality and expropriation risk lacks robustness, and instrumental-variable estimates become unreliable, often with infinite confidence intervals.

The AJR paper has been very influential, so this paper is potentially very important and well worth reading (here is a link to an ungated version).

The indictment is strong. Here are some details:

The historical sources containing information on mortality rates during colonial times are
thin, which makes constructing a series of potential European settler mortality rates challenging. AJR construct their series by combining the mortality rates of soldiers (Curtin 1989, 1998), laborers (Curtin 1995), and bishops (Gutierrez 1986). Researchers have been eager to use this new series, particularly given its promise as an instrumental variable for institutions. Currently, over twenty published articles, and many more working papers, use AJR’s settler mortality data. This paper argues that despite AJR’s ingenuity and diligence, there are a number of reasons to doubt the reliability and comparability of their European settler mortality rates and the conclusions which depend on them. First, out of 64 countries in their sample, only 28 countries have mortality rates that originate from within their own borders. The other 36 countries in the sample are assigned rates based on AJR’s conjectures as to which countries have similar disease environments. These assignments are based on weak and sometimes inaccurate foundations. Six assignments are based upon AJR’s misunderstanding of former names of countries in Africa. Another sixteen assignments are based on a questionable use of bishop mortality data in Latin America from Gutierrez (1986), which are based on 19 deaths. Additionally, AJR use the bishop rates multiplied by a factor of 4.25, a procedure that appears to contradict evidence in their own sources. At a minimum, the sharing of mortality rates across countries requires that statistics be corrected for clustering (Moulton, 1990). This correction noticeably reduces the significance of AJR’s results. If, in the hope of reducing measurement error, AJR’s 36 conjectured mortality rates are dropped from the sample, the empirical relationship between expropriation risk and mortality rates weakens substantially, particularly in the presence of additional covariates. Second, AJR’s mortality rates never come from actual European settlers, although some settler rates are available in their sources. Instead, AJR’s rates come primarily from European and American soldiers in the nineteenth century. In some countries, AJR use rates from soldiers at peace in barracks, while in others, they use rates from soldiers on campaign. Soldiers on
campaign typically have higher mortality from disease, and AJR use campaign rates more often in countries with greater expropriation risk and lower GDP. Thus, AJR’s measures of mortality artificially favor their hypothesis. In a few countries, AJR use the maximum mortality rates of African laborers, although these do not appear comparable with average soldier mortality rates. Controlling for the source of the mortality rates weakens the empirical relationship between expropriation risk and mortality rates substantially. Furthermore, if these controls are added and the conjectured data are removed, the relationship virtually disappears. Additional data provided by AJR in their Response (2005) do not restore this relationship.

Lyndon Johnson bared his scars....

...and so did Andy Roddick:

Q. Last year when you talked to us here in this room after your last match you were pretty distraught. What is your feeling right now?

ANDY RODDICK: Uhm, you know, pretty distraught. But, I mean, you know, probably I don't know what I am. Uhm, probably just disappointed.

You know, I literally I mean, you know, any chance I got I pretty much just choked it. So, you know, that's tough to deal with, and that's not something that you really want to do, you know.

So that's probably that's disappointing, you know. It's not an easy thing to say, but it's pretty much what happened.

I could sit here and try to dance around it all night, but, I mean, you guys watched it. It was what it was. It's like you want something so bad you almost squeeze too tight.

Thursday, June 26, 2008

Jon Wertheim joins the club

The Angus Anti-Djokovic Club:

You just can't call out the five-time defending champ and then go out in straight sets on the third day of the tournament. I thought Djokovic played a lazy -- dare we even say cowardly? -- match. Bad body language, little tactical adjustments, a symbolic double-fault on match point.

Full article is here.

Link to My Keynote Speech, in its Entirety

Finally, a link to a video of the keynote speech I gave in Denver. I think I posted it before, but people were still asking....

A step in the right direction: Even George Will gets it!

Yes, even Georgie "the sexual intellectual" Will knows that it's nuts to not raise the limits on visas for skilled foreigners:

The semiconductor industry's problem is entangled with a subject about which the loquacious presidential candidates are reluctant to talk -- immigration, specifically that of highly educated people. Concerning whom, U.S. policy should be: A nation cannot have too many such people, so send us your Ph.D.s yearning to be free.

Instead, U.S. policy is: As soon as U.S. institutions of higher education have awarded you a Ph.D., equipping you to add vast value to the economy, get out. Go home. Or to Europe, which is responding to America's folly with "blue cards" to expedite acceptance of the immigrants America is spurning.

Two-thirds of doctoral candidates in science and engineering in U.S. universities are foreign-born. But only 140,000 employment-based green cards are available annually, and 1 million educated professionals are waiting -- often five or more years -- for cards. Congress could quickly add a zero to the number available, thereby boosting the U.S. economy and complicating matters for America's competitors.

Suppose a foreign government had a policy of sending workers to America to be trained in a sophisticated and highly remunerative skill at American taxpayers' expense, and then forced these workers to go home and compete against American companies. That is what we are doing because we are too generic in defining the immigrant pool.

Barack Obama and other Democrats are theatrically indignant about U.S. companies that locate operations outside the country. But one reason Microsoft opened a software development center in Vancouver is that Canadian immigration laws allow Microsoft to recruit skilled persons it could not retain under U.S. immigration restrictions. Mr. Change We Can Believe In is not advocating the simple change -- that added zero -- and neither is Mr. Straight Talk.

John McCain's campaign Web site has a spare statement on "immigration reform" that says nothing about increasing America's intake of highly qualified immigrants. Obama's site says only: "Where we can bring in more foreign-born workers with the skills our economy needs, we should." "Where we can"? We can now.

Solutions to some problems are complex; removing barriers to educated immigrants is not.

A Step in the Right Direction: Bob Barr is MY Guy for Prez

Since Angus and I have in the past disagreed about John McCain, perhaps it is not surprising that we also disagree about Bob Barr. (I should note that Angus really only claims that McCain is easily the best of the available candidates, not some kind of ideal.)

I have discussed this a bit elsewhere, as some have noticed.

But, in regards to Angus' questions (which, I should note, are perfectly fair questions):

1. Ron Paul has said he would have supported the Defense of Marriage Act, for the same federalism reasons as Bob Barr. And, I have heard Bob's discussion of this at the LP Convention, AND have talked to him about it at length in private. It is quite clear to me that he wants the federal government out of the "regulation of marriage" business, and that is at least a step in the right direction; it's a libertarian position. If some folks think it isn't libertarian ENOUGH, they are entitled to their views. But many of those folks aren't registered to vote, and don't consider the Libertarian Party to be anything important anyway.

2. As for the immigration/English only question, it is fair to say that the LP is divided on this issue. LOTS of libertarians, and some Libertarians (big L), agree with the idea that we need to control immigration. It happens that I would be for open borders as an ideal, and anything closer to that as a policy direction. But I get LOTS of argument about this, from voters. In fact, a lot of voters who would otherwise support me tell me they CAN'T, because of my stance on immigration. So, while Barr's view is different from mine, there are LOTS of Libertarians who agree, and it is a clear vote winner.

Look, the most the Libertarian Party has ever gotten was 1.1%, in 1980. And, as I have said before, I clearly remember that Angus CLAIMED to have voted for Ed Clark that year, though of course it may have been a jest. If in fact the Libertarians got 5% this year, that would make a HUGE difference in many ways, at every level.

Bob Barr is my man. I have already contributed twice, and plan to max out my contributions, up to the limit prescribed by law.

For more details on Bob's position, and whether a check of the record says he's a Libertarian, check this very fine post.

Amazing: There Really IS a Second Amendment, Virginia!!

Cool. The Court read the Constitution. Wow.

Is Micheal Beasley really a "clown" and if so does it matter?

Adrian Wojnarowski, via an anonymous "respected NBA source" throws Micheal Beasley WAY underneath the bus on the morning of draft day.

“He’s almost always talking, and almost never on time,” the respected basketball official said. “If he’s on time, he’ll be the last one to show up. And he’s always got a question. He’ll ask a lot of questions because he wants people to think he’s paying attention – because he’s not paying attention.

“He’s not a bad kid, but I do think he makes similar decisions as bad ones do. He isn’t malicious, or even disrespectful, but he makes the dumb decisions that bad people make.”

Beasley is the best talent in the draft. There isn’t a close second. Whatever people want to say about Memphis point guard Derrick Rose, he won’t win the honor of the No. 1 pick in Thursday night’s draft as much as Beasley will blow it. Beasley is a long, 6-foot-8½ , responsible for a surreal 26.2 points and 12.4 rebounds as a Kansas State freshman, and he still hasn’t made a convincing case to Chicago and Miami.

Beasley has done little to change minds in his meetings with the two teams. For everything his AAU coach and agent did to carefully control his college environment, his path to the pros, they’ve struggled to polish Beasley’s image. There were six high schools and relentlessly foolish stunts and an attitude of indifference and clownery everywhere but the basketball court. After months of probing him, Beasley was strangely amused by what the Bulls and Heat officials were most interested in discovering about him.

In my opinion, the only crazy thing would be not drafting him. He is a monster on the court and that is what matters, right? I actually hope he doesn't go to the Heat, because that franchise is stuck in self destruct mode. If Beasley by some miracle falls to 4th, I would be one happy happy okie!

Wednesday, June 25, 2008

So let me get this straight...

Bob Barr is the Libertarian Party candidate for president? This Bob Barr??

Now I admit to being a non-voting poseur belonging to no party, but I'm pretty sure that Barr is in no way shape or form a libertarian.

From this blog post I gathered the impression that he voted for the Patriot Act and the Defense of Marriage Act.

From this website I see that Barr sponsored a bill making English the official language of the US and voted against raising the limit on visas for skilled workers

So I have to ask, WTF?? The man rocks one hell of a nice mustache, but is that really all it takes?

Has the LP sold its soul for the meager pottage of getting 5% of the vote in the fall?

a big KPC thank you to Marat Safin

who administered a severe beatdown to the fuzzy headed, gum flapping, arrogant, Serbian idol Novak Djokovic today at Wimby.

I like how the AP put it: Novak Djokovic was upset in straight sets by Marat Safin in the second round at Wimbledon on Wednesday, ending the Serb's chances of testing his theory about Roger Federer's vulnerability.

Post match, Novak showed his usual charm:

Safin is a player who is known as a big talent, but again, he makes a lot of unforced errors," he said. "I had opportunities, but I just made some unforced errors, which were really uncharacteristic, without any sense.

"Safin still has his ups and downs, and is known for his mental instability in some ways, but he's still a great player. He wants to step it up again. (Today) he was mentally there."

Maybe Marat is inspired by the great play of his sister Dinara. I'd love to see him make a deep run in this tournament, but I thank him for getting this fool Djokovic off the radar.

Does the Professor Matter?

and if so, how do we know and how do we measure? Student evaluations are problematic instruments because they are strongly related to expected grades and even to the physical appearance of the instructor.

In a very interesting new NBER paper, Scott Carrell and James West exploit the particular characteristics of the US Air Force Academy system to try and provide an answer. At the USAF students are assigned randomly to professors in a range of core courses and are also randomly assigned to sections of required follow-up courses.

Though there is a lot of heterogeneity across subjects, they tend to find that while less experienced professors produce better grades in the initial core course, their students tend to do worse in the follow on courses.

Since the exams are common across all the sections of the core courses and grading is done by a committee of the the professors teaching the classes, this is not due to the less experienced professors inflating grades. Instead it is likely due to the less experienced professors "teaching to the test", while more experienced professors teach in a way that benefits students in later related coursework, like teaching them general methods of working in the subject field.

Here is a link to an ungated version of the paper.

Tuesday, June 24, 2008

So THATS why they're fudging the numbers!

In today's WSJ, Ken Rogoff and Carmen Reinhardt join Angus's "Argentina's in trouble" club.

In doing so, they give a very good reason for why the Kirchner governments have so stubbornly refused to concede that inflation is a problem in Argentina:

Already, a good share of Argentina's debt is in default. What else do you call it when a government that owes over $30 billion in inflation-indexed debt manipulates its consumer-price statistics? Through a variety of crude measures (such as firing its top statisticians), the government is publishing an understated inflation rate that is used for calculating indexation payments.

The official inflation rate in Argentina for the past 12 months is under 10%. But the true inflation rate appears to be at least 30%, according to virtually every neutral source.

I think that maybe the best thing to be in Argentina right now is a pot and pan seller!!

Monday, June 23, 2008

Hey Bristol: Chris Fowler talking is NOT Tennis!

Me and Mrs. Angus are probably the last two tennis fans in North America. We love watching the French Open, Wimbledon and the US Open and in theory having ESPN2 live broadcasting Wimby every morning should be a productivity killing treat for us.

Yet here I am in the office blogging instead of at home vegging because ESPN seems to think Chris Fowler flapping his ignorant gums is live tennis. He yammered through a full set of Serena's opening match about the queen of England's hobbies. He yammered through a bunch of Ana Ivanovic's opening match about how Sam Querry is a dog.

He (a) doesn't know anything about tennis and (b) is not even remotely entertaining.

So please ESPN: Show tennis on your live tennis broadcasts! Pick a match and show it with occasional cutaways to other live breaking stories of matches in progress. Don't show me Chris Fowler drinking tea and trying to be witty. You only have two people watching anyway, so give us what we want!

And Tarija makes 4

Now four Bolivian provinces have passed an "autonomy referendum", and the latest to do so, Tarija, holds the great majority of Bolivia's natural gas deposits (which is the country's major export). It is not totally clear exactly what these referenda mean, though the first one in Santa Cruz and this fourth one passed overwhelmingly, but to me the message is that the relatively wealthy and non-indigenous lowland part of the country is not going to go along with Evo Morales and his Andean supporters attempt to re-write the constitution and govern the country in a different way. The implicit threat is that these rich provinces will withhold tax revenues from the central government.

Morales has also agreed to stand for recall in an election this August. Despite his troubles in the Eastern provinces, he is likely to avoid recall. However, as this LA Times article points out, simply holding the election significantly delays any possible vote on Morales' new constitution, which if approved would allow him to run for re-election and likely mandate land re-distribution in the Eastern provinces.

All this political infighting may well simply be the old guard's attempt to ride out Morales' term without losing their current standing/status/wealth while hoping for better treatment from the next president. Here is a previous KPC post on delaying tactics for Evo's new constitution.

Sunday, June 22, 2008

The movies come to Angus

Thanks to on demand cable, we get to see a wider range of movies at Chez Angus than what shows in the local multiplex (though with a lag of course). We just watched "Lars and the Real Girl" and I have to say based on his performance there and in "Half Nelson" that Ryan Gosling is an incredibly talented actor. Both movies required his character to do really strange things and he was amazingly believable and compelling at all times.

On the face of it, the plot of "Lars" is untenable, but Gosling (along with the actors playing his sister-in-law and his doctor) really pulls it off. If you haven't seen it, you should (Half Nelson too!).

My favorite actor used to be Guy Pierce, but while "Memento" is a better movie than any in which Gosling has appeared, I gotta give Ryan the nod at this point (Guy will no doubt be devastated to hear this news).