Economics, Politics, Legal History & Science. ‘Solid liberal’ in US, wide spectrum centrist in Germany. Impeach Trump as of January 2017.
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‘Hyperalarming’ study shows dramatic loss of insects in pristine American tropical forest

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A new report suggests the decline in invertebrate populations is more widespread than scientists realized. Huge numbers of bugs have been lost in a pristine national forest in Puerto Rico, the study found, and the forest’s insect-eating animals have gone missing, too.





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stefanetal
30 days ago
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Incredibly scary stuff.
Northern Virginia
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Daniel Schneider and Kristen Harknett: Consequences of Routine Work Schedule Ins...

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Daniel Schneider and Kristen Harknett: Consequences of Routine Work Schedule Instability for Worker Health and Wellbeing: "The rise in precarious work has also involved a major shift in the temporal dimension of work, a fundamental and under-appreciated manifestation of the risk shift from firms...

...To date, a lack of suitable existing data has precluded empirical investigation of how such precarious scheduling practices affect the health and wellbeing of workers. We use an innovative approach to collect survey data from a large and strategically selected segment of the US workforce: hourly workers in the service sector. These data reveal relationships between exposure to routine instability in work schedules and psychological distress, poor sleep quality, and unhappiness. While low wages are also associated with these outcomes, unstable and un-predictable schedules are much more strongly associated. Further, while precarious schedules affect worker wellbeing in part through the mediating influence of household economic insecurity, a much larger proportion of the association is driven by work-life conflict. The temporal dimension of work is central to the experience of precarity and an important social determinant of worker wellbeing....


#shouldread
#equitablegrowth
#labormarket
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stefanetal
31 days ago
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Northern Virginia
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Republican voters don’t care about Trump’s corruption — and here’s why

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The past couple of weeks of the news have served up a hefty reminder not just of the deep corruption of Donald Trump, but of the entire Republican Party. On top of the headline-dominating story about Republicans ignoring all sorts of ethical concerns to place Brett Kavanaugh on the Supreme Court, there was also a blockbuster New York Times report showing that Trump amassed his massive fortune not through hard work or business acumen, but old-fashioned tax fraud and corruption. Meanwhile, there's a pileup of stories indicating that Republicans intend to shore up their prospects in the November midterms through blatant and racist cheating, using a series of Jim Crow-style strategies to keep black and Native American voters from the polls in November.

To add to this already disturbing situation, there's the shady behavior Trump is displaying around the disappearance and likely murder of Jamal Khashoggi, a Washington Post columnist who has run afoul of  Mohammed bin Salman, the crown prince of Saudi Arabia and big buddy of presidential son-in-law Jared Kushner. Saudi Arabia is widely believed to be behind the attack, but Trump — who himself is overtly hostile to the free pressseems reluctant to do anything about the situation, citing his unwillingness to spike an arms deal with Saudi Arabia. It's a stance made even more disturbing by the fact that arms deal isn't even real, but more like a fantasy unlikely to come to fruition. There is also reason to believe that Trump is personally enriching himself off the Saudi government, which likely factors into his decision-making.

Despite all this, in a story that's become all too predictable, Trump's approval ratings don't budge, lingering a few percentage points north or south of 40 percent. He's not popular and never has been, but it's clear that the 40 percent of voters who love him really do not care if he's a crook. And despite the GOP's widespread corruption, FiveThirtyEight still gives the party a four-in-five chance of holding a Senate majority in the midterm elections.

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It's easy to chalk off this widespread indifference to criminality and corruption among Republican voters as evidence that such voters are themselves amoral. But that reading is overly simplistic. It's highly unlikely that 40 percent of the country thinks it's no big deal to cheat or steal or lie under oath or shrug off a murder likely ordered by your son-in-law's friend. Nor is it satisfying to simply blame partisanship. Democratic voters are also highly partisan, but don't seem to have nearly the same tolerance for immoral behavior being conducted in their name.

Instead, the likeliest reason for this willingness of Republican voters to indulge all sorts of wicked behavior in pursuit of power is that they've convinced themselves that the "other side" does it just as much. It's an attitude called "what-about-ism," and it allows Republican voters to tell themselves that their side can be as shady and corrupt as they want to be, because Democrats do it, too.

Of course, the fly in that particular ointment is that Democrats do not, in fact, do it too. Barack Obama did not put an accused sexual predator on the Supreme Court after that person repeatedly lied under oath, nor did he shrug it off when an American journalist was killed because he happened to be fond of the alleged murderer. Democrats are not trying to steal elections through widespread cheating. Hillary Clinton was no tax fraud and was able to prove it by releasing her tax returns, something Trump continues to refuse to do.

This disparity, I think, points to one reason why conspiracy theories tend to proliferate more on the right than the left. In the absence of real corruption and crime among Democrats or leftists, conservatives instead rely on  conspiracy theories to justify their continued belief that Democrats are just as corrupt as Republicans, if not more so.

If one believes, for instance, that Obama faked his birth certificate to evade citizenship requirements to be in the Oval Office — as a solid majority of Republicans suspect — then the fact that Trump is a tax fraud doesn't seem so unusual or objectionable. If one buys into the theory that the Clintons had former White House lawyer Vince Foster murdered back in the 1990s, then Trump's shady attitude about the murder of Khashoggi pales in comparison. And while it's basically impossible to follow what, exactly, Republicans are getting at with their Benghazi obsession, they've using that fake conspiracy theory to minimize real concerns about Trump's possible role in Russia's criminal interference with the U.S. election.

No wonder Trump continually leads his rallies with chants of "lock her up," in reference to the many Clinton crimes alleged by conspiracy theorists that do not exist in real life. The more the crowds insist that Clinton is a criminal, the easier it is for them to justify voting for Trump, who has admitted to sexual assault on tape, has committed what the New York Times deemed tax fraud, and may be implicated in the Russian interference in our election.

The conspiracy theory defense was on display during the Kavanaugh confirmation hearings. Kavanaugh, after all, was accused of a very serious crime — attempted rape — and lying under oath to cover it up. Rather than deal with that, however, conservatives turned to finger-pointing, starting with Kavanaugh himself — in a written statement that can't be written off as heated language under pressure — claiming that the sexual assault accusations from multiple women were some kind of plot to get "revenge on behalf of the Clintons."

Kavanaugh then used this alleged plot, which almost certainly doesn't exist, to imply that he and other conservatives were entitled to do all sorts of unethical things in response, saying the "whole country will reap the whirlwind."

Donald Trump was right when he gave that infamous speech declaring that he could "shoot somebody" in broad daylight without losing voters. In the right-wing imagination, Democrats do evil things, even commit murder, on a regular basis and get away with it. So too many conservatives have convinced themselves that it's only fair to let Trump get away with similar things, even though the bad things he's doing are all too real and not from the realm of fevered conspiracy theory.

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acdha
33 days ago
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Washington, DC
stefanetal
33 days ago
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Northern Virginia
chrishiestand
33 days ago
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San Diego, CA, USA
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Our insular culture

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There are only three economies in the world – the UK, US and Venezuela.

Or at least, this is what you’d think listening to the recent reaction to Labour’s plans for nationalizing utilities and more worker say in corporate governance. Rather than see these for what they are – steps towards European-style social democracy – many on the right greeted them with shrieks of “Venezuela!!”.

This reflects a longstanding and paradoxical defect in British (English?) political discourse: that although Brexit dominates our politics our knowledge of European polities is near-zero, and certainly not strong enough to form obvious reference points. It’s not just the right that is guilty here. So are leftists. Whenever free marketeers propose reforming the NHS, they immediately invoke images of dystopian American healthcare rather than, say, the Swiss or German systems.

Our ignorance of Europe takes countless very sensible questions off the agenda such as: why is the Finnish education system so good? What can Norway’s experience tell us about the case for a sovereign wealth fund? Why do the Netherlands and Germany have such low youth unemployment? How might we improve vocational education or support SMEs? How best can we design a welfare state that minimizes poverty without greatly diminishing work incentives? And so on.

One of the basic principles of good management is that one should learn from best practice. The absence of Europe from UK politics means we don’t do this. Our political culture imports the worst from corporate management – such as leadershipitis and PR bullshit – but not the best. Dad's_Army_-_Opening_Titles

This lack of Europe helps entrench another baleful aspect of our political culture, which we saw during the party conference season – an over-valuation of the merits of speeches. This, of course, reflects our backward-looking and anti-historical mythologizing of Churchill as merely a bellicose rhetorician. In this mythology World War II – which is one of the very few referents available to our impoverished political discourse – was won by fine words rather than by collective organization. The gruntwork of good administration and consensus-building are thus under-rated. Our ignorance of Europe means there’s no counterweight to this.

It’s not hard to find the cause here. We are a monoglot nation. My experience of learning French and German consisted largely of being shouted at by lunatics. Whilst good preparation for the world of work, this did not instil me with Europhilia*. And I’m not as atypical as I should be. Even Gordon Brown, one of our most educated politicians of recent times, looked to the US rather than Europe for his influences.

Herein lies another paradox. Whilst the left considers itself internationalist and centrists flatter themselves to be modern sophisticates, it is the nationalist right which in practice does more to resist this. Links between Farage, Le Pen, Orban, Trump and Putin are perhaps stronger than those between their civilized counterparts.

The media, of course, reinforce all this. The issue here is not merely that lies about the EU have suited its agenda for decades. It’s that reasonably good government is not news. There is therefore silence about policy successes on the continent. In this way, as in others, the news creates a bias against understanding.

I suspect that the net effect of the de facto absence of Europe from political debate is to support neoliberalism by creating the impression that the only alternative to it is economic disaster such as Venezuela is enduring. This, though, is a secondary point. What is more certain is that contributes significantly to bad government and silly political debate.

* It was only quite late in life that I learned that the point of learning French was to better understand the songs of Jacques Brel.

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stefanetal
36 days ago
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Similar enough situation in the US. And one of my pet peeves is that French and German political cultures are surprisingly insular as well, once you get past superficial knowledge.
Northern Virginia
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Essential Fall Reading

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  • Buono, D., G. Kapetanios, M. Marcellino, G. Mazzi, & F. Papailias, 2018. Big data econometrics - Now casting and early estimates. Working paper N. 82, Baffi Carefin Centre for Applied Research on International Markets, Banking, Finance, and Regulation, Bocconi University.
  • Fair, R. C., 2018. Information content of DSGE forecasts. Mimeo
  • Lewbel, A., 2018. The identification zoo - Meanings of Identification. Forthcoming, Journal of Economic Literature.
  • Pretis, F., J. J. Reade, & G. Sucarrat, 2018. Automated general-to-specific (GETS) regression modeling and indicator saturation for outliers and structural breaks. Journal of Statistical Software, 86, 3.
  • Woodruff, R. S., 1971. A simple method for approximating the variance of a complicated estimate. Journal of the American Statistical Association, 66, 411-414.
  • Zhang, R. & N. H. Chan, 2018. Portmanteau-type tests for unit-root and cointegration. Journal of Econometrics, in press.
© 2018, David E. Giles
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stefanetal
44 days ago
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Ray Fair being surprisingly nice to DSGE forecasting abilities.
Northern Virginia
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When detail matters

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Chris Giles says that in predicting that a no-deal Brexit will cause house prices to fall 35%, Mark Carney’s has fallen “into the trap of giving his audience precise numbers at a time they are neither knowable nor helpful.” This poses the question: when is precision and detail useful, and when not?

In this case, Chris is right. A precise number gives the impression of knowledge which is in fact not available to us. I’d prefer that Carney’s warning was expressed as:

We have mechanisms which point to house prices falling because of Brexit: lower income expectations, plus heightened uncertainty (plus momentum effects after these have kicked in). These probably outweigh the positive effects upon house prices: increased optimism among Brexiters; and slightly lower interest rates. Although we can’t quantify how these mechanisms will play out, we can be moderately confident of the direction of change.

There’s another context when detail is unimportant – when we put it before general principles. Take, for example, McDonnell’s plan for increased worker ownership. The significant thing here – at this stage – is not the details, but the question: do the benefits of greater worker ownership outweigh the disbenefits of a slightly higher cost of capital caused by the dilution of owners’ current stakes?*

This is especially the case because the detail – at this stage – is malleable. The £500pa cap on the amount of dividends workers can get, or the 10% ceiling on their stake, can both change in light of evidence.

In fact, there’s another reason why the details of MCDonnell’s plan aren’t very important. It’s that our uncertainty about the size and net direction of their behavioural effects surely swamps any quibble about those details. There is, as Thomas Meyer wrote, sometimes a trade-off between truth and precision in economics. Precise numbers can distract us from what’s really important, such as the confidence intervals around those numbers, and the costs of being wrong. In the run-up to the financial crisis, banks had precise estimates of value at risk which proved to be useless. They and us would have been better served by less precision and more truth.  To take another, example, media demands that parties’ spending plans be “fully costed” ignore the fact that there’s massive uncertainty about future government borrowing.

Keynes didn’t actually say “it is better to be roughly right than precisely wrong”, but he should have done.

This speaks to another context when precision is irrelevant – when it is mere noise. The FTSE 100 fell by precisely 35.24 points on Friday. For almost all practical purposes, however, this knowledge is useless. It tells us nothing worth knowing, and certainly nothing about what really matters for investors, which is where the market is heading. In fact, for the purposes of this question, almost all precise knowledge is useless – and in fact, worse than useless if relied upon for asset allocation.

So, when does detail matter? One is that it can be a guide to whether a policy is practical. McDonnell’s plan, whatever other demerits it might have, clears this hurdle. Brexiters’ plans for the Irish border, by contrast, don’t; they amount to little more than “technology, yeah!”

Detail also matters, of course, when it cannot change – when we’ve signed contracts and treaties. It’s reasonable to demand more detail of those proposing a trade deal with the EU than of those proposing a change in tax rates: a trade deal is a bastard to change, a tax rate less so.

It also matters as a way of telling us whether somebody has thought seriously about a problem or not. The lack of detailed proposals for Brexit, for example, is as Chris Grey says, a sign that Brexiters just haven’t confronted basic realities.

Finally, of course, there is some truth in the old saw, “the devil is in the detail.” I suspect, for example, that the appropriate amount of worker say in the running of any business depends upon the detail of how knowledge, and about what, they have relative to management. This will differ from firm to firm, and cannot be known to policy-makers. Hayek’s great insight, of course, is that sometimes (often) important detail cannot be known by a single person.

Sometimes, then, detail matters and sometimes it doesn’t. I fear, though, that the media doesn’t sufficiently appreciate this. Precision makes better headlines: “Carney warns of 35% slump in house prices” is a better headline than “Carney thinks house prices will probably fall by an unknowable amount.” And interviewers sometimes prefer cheap gotcha quizzing about unimportant detail than about points of principle (at least when they are interviewing John McDonnell rather than Brexiters).

There are two useful things we should bear in mind here.

One is number sense. Sometimes, what matters is not a precise number, but questions such as: how confident can we be about that? Where does that number come from? Is it a lot or a little? The other is to be on guard against the illusion of knowledge. Detail and precision sometimes give us mere overconfidence, not genuine useful knowledge. We should ask: why does this matter? When we do, we can see that precision is only sometimes helpful.

* The policy is about corporate governance, not about giving a short-term boost to workers’ incomes – a point some have missed.

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stefanetal
45 days ago
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Making a precise calculation about an uncertain outcome can also clarify assumptions (for instance about about inputs & and mechanisms) as well as the necessary responses quite a bit. Upper an lower bounds and other implied effects etc. ‘House prices will fall’ is quite different than ‘2% fall vs 35% fall’. Those two require most likely different responses.

On the other hand, clients love to misuse precise estimates for blame shifting and ass covering (while at the same time filtering what sort of estimates make it into other parts of the organization and into the public).
Northern Virginia
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