Economics Detective Radio

Algorithms, Algorithmic Discrimination, and Autonomous Vehicles with Caleb Watney Today's guest is Caleb Watney of the R Street Institute. In our conversation, we discuss algorithms, particularly with respect to their role in judicial decision making. Later in the conversation, we discuss the algorithms that will one day replace ape brains as the primary controllers of our cars. Caleb wrote a Cato Unbound essay in response to an article by Cathy O'Neil. O'Neil, a mathematician, argues that algorithms could potentially lead us astray. Her book Weapons of Math Destruction: How Big Data Increases Inequality and Threatens Democracy has sounded the alarm about the potential harms of an over-reliance on algorithms. In Caleb's view, O'Neil has pushed too far in the anti-algorithm direction. He points out that private companies have used algorithms to generate amazing innovations. Government is a different story: "The most compelling concerns about the improper use of AI and algorithms stem primarily from government use of these technologies. Indeed, all the tangible examples of harm O’Neil cites in her essay are the result of poor incentives and structures designed by government. Namely, hiring models at a public teaching hospital, teacher value-added models, recidivism risk models, and Centrelink’s tax-fraud detection model. The poor results of these kinds of interactions, in which governments purchase algorithms from private developers, could be viewed primarily as a failure of the government procurement process. Government contracting creates opportunities for rent-seeking, and the process doesn’t benefit from the same kinds of feedback loops that are ubiquitous in private markets. So it should be no surprise that governments end up with inferior technology." We discuss the merits and demerits of algorithms, how different private and public incentives interact with algorithms, and the difficulties in creating algorithms that can be fair and transparent. Caleb's ultimate solution for many of the problems associated with algorithms used by the government is for those algorithms to be open source in order to foster public scrutiny of their processes and outcomes. During the conversation, Caleb alludes to this paper by Kleinberg, Mullainathan, and Raghavan, which shows that there are three competing definitions of algorithmic fairness that cannot all be achieved simultaneously.

Sam Hammond returns to the podcast today to discuss the free market welfare state. He and Will Wilkinson have both written articles in this area recently, and we discuss some of the concepts they bring up. People tend to think of government functions on a one-dimensional spectrum with "big government" on one end and "small government" at the other. Sam points out that the welfare state is separable from the other functions of government (regulation, command and control, protectionism, etc.). Not only is this true in theory, but it is played out in practice, with Nordic countries having very large welfare states as well as high economic freedom. We discuss some of the problems with current welfare states and some ways to improve them. Related links: Study: "Early Medicaid Expansion Associated With Reduced Payday Borrowing In California" "Food Stamp Entrepreneurs," a study that shows that access to food stamps makes people more likely to start businesses.  

My guest for this episode is Scott Cunningham of Baylor University. We discuss his work on the decriminalization of indoor sex work and on the impact of Craigslist's erotic services page on violence against women. The working paper on Craigslist generated a lot of media attention, with articles at Huffington Post and ThinkProgress. The most quoted statistic is that "Craigslist erotic services reduced the female homicide rate by 17.4 percent." We discuss this statistic, its possible causes, and whether or not it is implausibly large. Here's Lynn Arditi's article on the accidental decriminalization of prostitution in Rhode Island. Scott mentions John Snow, the scientist who first discovered that cholera was spread by contaminated water sources. Here's the first video in a series on him.  

My guest today is Lyman Stone. He is an agriculture economist for the USDA, but our topic for this episode is his popular writing about migration. He blogs at In a State of Migration on Medium and co-hosts the podcast Migration Nation. We discuss the history of migration restrictions in the United States, the economic impact of migration between and within nations, and the relationship between falling fertility and immigration. The Great Baby Bust of 2017 "Economics and Emigration: Trillion-Dollar Bills on the Sidewalk?" by Michael A. Clemens (2011) "Does Mass Immigration Destroy Institutions? 1990s Israel as a Natural Experiment" by Benjamin Powell, J.R. Clark, and Alex Nowrasteh (2017)  

This episode of the podcast features two guests, Zach and Kelly Weinersmith. Zach is the author of SMBC Comics, a popular webcomic that sometimes deals with advanced concepts in science, philosophy, economics, and other fields. Kelly is a professor in the Biosciences department of Rice University. Together they co-authored Soonish: Ten Emerging Technologies That'll Improve and/or Ruin Everything. To quote the book's description, In this smart and funny book, celebrated cartoonist Zach Weinersmith and noted researcher Dr. Kelly Weinersmith give us a snapshot of what's coming next--from robot swarms to nuclear fusion powered-toasters. By weaving their own research, interviews with the scientists who are making these advances happen, and Zach's trademark comics, the Weinersmiths investigate why these technologies are needed, how they would work, and what is standing in their way. In this fun and lively conversation, we discuss some of the technologies discussed in the book: space elevators, asteroid mining, augmented reality, and programmable matter. We also discuss the tragic life of Gerald Bull, Canadian space cannon enthusiast.

My guest on this episode is Shruti Rajagopalan of the State University of New York's Purchase College. We discuss Shruti's work on constitutional political economy as it relates to India. We start by talking about the Indian constitution. India got its independence in 1947 and ratified a constitution shortly after in 1949. Interestingly, it is the most amended constitution in the world. Shruti argues "that the formal institutions of socialist planning were fundamentally incompatible with the constraints imposed by the Indian Constitution." We go on to discuss Shruti's work on the Bhopal gas tragedy, which demonstrates some of the failings of India's institutions. The Bhopal gas tragedy was a man-made disaster in 1984 where mishandling of dangerous chemicals by the company Union Carbide resulted in thousands of deaths and hundreds of thousands of non-fatal injuries among the public. The Indian government mismanaged the legal cases against Union Carbide, resulting in no payout to the people affected by the disaster.  

Robin Hanson returns to the podcast to discuss his new book, The Elephant in the Brain: Hidden Motives in Everyday Life, co-authored with Kevin Simler. As the subtitle suggests, the book looks at humans' hidden motives. Robin argues that these hidden motives are much more prevalent than our conscious minds assume. We are not conscious of the vast majority of the functions of our brains. This extends beyond the most basic things our brains do (such as commanding our hearts to beat every second or so) to many things we think of as higher-level cognitive tasks. Hanson and Simler argue that, if the brain were a corporation, the conscious mind wouldn't be the CEO but the press secretary. Most of the reasons our conscious brains give for our actions are actually ex-post rationalizations for decisions that have been made unconsciously and for reasons that aren't immediately obvious to us. As a press secretary, the conscious mind is better off not knowing if we are doing things for selfish reasons since that would make it more difficult to justify our actions to others. Some very compelling evidence for this thesis comes from studies of people with split brains. People with severe epilepsy have sometimes been treated by severing the connections between the two halves of their brains. Researchers noticed that when one side of the brain was fed information that led to a particular action (e.g. an instruction from the researcher to "stand up") the other side would construct a reason for the action (e.g. "I was thirsty and I got up to get a drink"). If the brain were truthfully answering these questions, it would say "I don't know." However, the split-brain patients confidently gave false answers apparently without realizing they were false. Hanson argues that neurotypical minds are doing the same thing: constructing justifications for our actions even if we aren't really aware of our true underlying motives. From the book's online description, "The aim of this book is to confront our hidden motives directly---to track down the darker, unexamined corners of our psyches and blast them with floodlights. Then, once our minds are more clearly visible, we can work to better understand human nature: Why do people laugh? Why are artists sexy? Why do we brag about travel? Why do we prefer to speak rather than listen?" We discuss this theory of the brain and how it applies to many areas of everyday life from medicine to body language. The Amazon links on this page are affiliate links. If this podcast convinced you to buy a copy of The Elephant in the Brain, doing so through one of these links will provide revenue to the podcast at no additional cost to yourself.  

My guest for this episode is Ennio Piano of George Mason University. Our topic is Ennio's work on the economics of biker gangs. Ennio has two papers on this subject. The first, published in Public Choice, is entitled Free riders: the economics and organization of outlaw motorcycle gangs and it describes the franchise-style model of the Hell's Angels motorcycle gang, and how that model contributed to that gang's rise to prominence. By making the local chapters of the Hell's Angels residual claimants, while the head chapter in Oakland is responsible for the gang's name and reputation, the gang exploits local knowledge while also coordinating activities internationally. The second paper, Outlaw and economics: Biker gangs and club goods describes how the norms and rituals of biker gangs fit with the theory of club goods. Costly, unreliable motorcycles and even Nazi tattoos can be explained through this theory: they are credible commitments to remain loyal to the club. This behaviour is similar in purpose to rituals practice by many religious sects. We discuss the history of biker gangs and the gang wars of the 1990s. Finally, Ennio describes the relationship between biker gangs and other criminal organizations such as the Mafia and Mexican drug cartels.

My guest today is Jake Meyer of California State University, Long Beach. We discuss Jake's work on the intersection of financial crises and politics. Jake's work explores important questions such as the interaction between interest group politics and financial and currency crises. A country's monetary authority needs to manage both the domestic labour market and the country's exchange rate, but particular interest groups tend to favour one over the other very strongly. If one of these interest groups becomes disproportionately influential in national politics, they can affect monetary policy in ways that lead to crises. For instance, if a group that cares about the domestic economy and not the exchange rate takes power, they can push the monetary authority into causing an exchange rate crisis. If a group that cares exclusively about the exchange rate takes power, they can push the monetary authority to ignore the domestic economy to the point that it causes a banking crisis. Jake's work also looks at the way countries learn in the wake of financial crises. He looks at the change in the growth rate of credit before and after a crisis, and he finds that things like the number of veto players and the independence of the central bank impact this change. Check out Jake's Quora account, where he answers many questions related to economics.

Today's guest is Kyle Coates and our topic is pro wrestling and the intellectual property problems that arise from it. So prepare to be amazed as we BODY SLAM this topic, or something. Who owns a wrestler's name, gimmick, and persona? Kyle was inspired to do research in this area when he heard about a legal dispute between the wrestlers Jeff and Matt Hardy and the wrestling network TNA. The Hardys changed networks and wanted to continue using a gimmick they had developed while performing for TNA. We discuss some of the lawsuits and disputes that have occurred in the pro wrestling sphere, and how to courts have treated these issues. And yes, we answer the most important question: If Dwayne "The Rock" Johnson runs for President, will he be able to use Rock puns in his campaign ads? Listen to the episode to learn the answer!