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Economics & Marginalia: December 13, 2024

December 13, 2024

Hi all,

A bit of housekeeping as we get started: next week’s will be the last Economics and Marginalia of the year. It will also feature some news, so do keep your eyes peeled (and yes, this is a brazen attempt to keep readers interested right up to the last edition). Though the year is coming to a close, it isn’t exactly winding down: I’ve got a few more blogs queued up till the end of the year, I’m just back from an excellent conference at Wilton Park on the use of evidence in policymaking; and I’ve spent the better part of the day on hold to various service providers waiting to have basic problems fixed. I hit a new record today: 6 hours on hold over 3 weeks (5 separate calls) to get to the right person; then 5 minutes to solve the problem. That ratio should be illegal. In one of the principal-agent problem case studies I taught MPP students this term, we use the example of contracting for the development and running of a public service platform, trying to get students to identify opportunities for quality-shaving in service provision. I should have just got them to try and query my water bill; it would have made the same point much more directly.

  1. There is a non-zero chance that I will do an end-of-year review blog this year, but my usual partner in constrained-optimism, Susannah Hares, moved on from CGD to a new job earlier this year. I’ve discussed the possibility of summarising the year’s big development stories with another colleague, but at the CGD Christmas party, over a drink and some very good home-bakes, we spent fifteen minutes trying to think of an unmitigatedly positive development-related story from 2024 and came up blank. The best we came up with was the lenacapavir trial, but one good news story does not a year-end blog make. What else did we forget? If we don’t wind up doing the year-end round up, at least Oliver Hanney has summarised another great year for VoxDev here. It’s excellent, from top to bottom, but especially top: his summary of a very good year of research into how policymakers use and respond to evidence is very good, as is the summary of the many ways the economics of migration continues to surprise.

  2. I recently wrote a piece arguing that more climate adaptation finance should be spent on anticipatory action that protects people against natural disasters. My colleague Eeshani Kandpal and Teresa Molina convincingly argue that this logic extends to all kinds of safety nets: better social protection helps ameliorate the damage done by disasters even when it isn’t triggered by the expectation of a specific hazard. This is a really important point, because there is no system of triggers that will protect against every disaster ahead of time; good systems of protection are a necessary part of the response. In a similar vein Marshall Burke and co-authors note that social protection also helps dampen the effect of climate change stress on conflictThe takeaway? Do more social protection, do it better.

  3. I really enjoyed this, from Tim Harford, about the work of Dan Davies (which I was not familiar with). Davies looks at when things go wrong in the economy, and what this can teach us about economies and economics. When companies go bust because they don’t look at the actual stuff they’re buying; when people lose bets because they don’t wonder why the bet was offered at all (this one really made me think of those cricket and gambling tragics who bet on obscure events like whether a wide would be bowled in the 19th over… do you really think that bet is being offered in good faith?). He does end with a brief appreciation of Hernando de Soto’s Mystery of Capital, a book that I loved when I first read it and have, over my career, gradually (and then suddenly, as Hemingway might say) fallen out of love with. De Soto does show how following the rules leads to absurdity in some places but it does not then follow that changing or streamlining the rules leads to sanity and prosperity. What we often forget when something goes wrong is that there are many other ways it could have gone wrong too. It’s not always correct to over-update on the basis of the specific way it went wrong this time. We can all fail in multiple ways.

  4. The DI Job Market Papers series continues. This week I read and enormously enjoyed Oluchi Mbonu’s piece on minibuses in Jo’burgIt’s the kind of paper I love: you would only think to look at this if you really knew the place, and really understood how things work. She then marshals an enormous volume of data to investigate. Highly recommended. Great title, too.

  5. Two very good ones from Andrew Gelman this week: first, remember that article from a few months ago about the horrors of black plastic kitchen utensils? Basically, they were made of the end of the world, and were slowly (or quickly) killing us. I read it, then got my black plastic spatula out and made a fried egg. I’ve read enough of these scare stories to realise that either the units were hiding the fact that the risk was below miniscule or it was just in mice. But I was wrong! The problem was something else: the authors got their numbers wrong by a factor of TEN. They claim it doesn’t affect their findings… but really? An error that size and even before we start thinking of all the other sources of uncertainty, it has no impact at all? Hmmm.  And, much more geeky: a really good post on simple stats with examples and useable code. The key sentence is this one: “If you have imbalance on pre-treatment variables and you adjust for them, that's fine, but your estimate will now be sensitive to your adjustment model.”

  6. A nice one from the World Bank’s data blog: exactly who are the poor around the world, and where do they live?

  7. Lastly, last week I asked about board games and my goodness are my reader’s amazing. I got several suggestions and even better, my CGD Secret Santa bought me one to play with the little one! I’m going to break it open on Christmas Day, and cannot wait. I’m tempted to ask if anyone has any recommendations for extremely rare vintage port and see if someone buys me a bottle, but instead I’ll end on something completely different: my friend Matt sent me Patricia Lockwood’s reflections on finally watching the X-Files, and specifically her response to Duane Barry (who was inspired by a real person it seems). If, like me, you’ve watched the X-Files start to finish (or at least to the end of Season 7) fifteen times or more, you’ll love this. It’s always nice to see something familiar through the eyes of someone else. There is always something new to notice. It’s interesting, though, that she latches on to the alien storylines. I always liked them less than the Monster of the Week episodes. There were some really amazing onesHome (horrifying), Clyde Bruckman’s Final Repose (moving), Terms of Endearment (with the Garbage needle-drop)The Post-Modern Prometheus (bizarre), War of the Coprophages(with Dr. Bambi)… Until I watched the Sopranos, the X Files was the best serious thing I had seen on TV. And on that note…

Have a great weekend, everyone!

R

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CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.