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Economics & Marginalia: October 18, 2024

Hi all,

Today’s links come to you from a heaving, overcrowded train carriage, perched in a corner with my laptop precarious, my charger looped around my waist and various annoyed-looking fellow-commuters nearby. Combine that with the England team contriving to go from a score of 800 and an innings victory to defeat inside 4 days, and my mood has seen sunnier days. The sour-faced fellow with the hip bag passive-aggressively poking into my rib cage has contributed to that, but what he isn’t aware of is that I can keep a cold war up for ages. I’ve just shuffled closer to him, and I’m pretty sure he’s reading this. (And yes, I’m fully aware that this may be the most culturally specific intro I’ve ever written to the links; for readers who have not been blessed with extended stays in the UK, transport chaos, disappointment in the cricket and passive-aggressive conflict is the forge in which the English are forged).

  1. The not-a-real-Nobel has been awarded! And if you read last week’s links and thought “I’ll put a flutter on these names” you would have been richly rewarded: this year’s Nobel went to Daron Acemoglu, Jim Robinson and Simon Johnson for their work in institutional economics. It is the third Nobel awarded to the field, following Elinor Ostrom (2009) and Douglas North (1993), or the fourth if you count Oliver Williamson. It has, so far, been highly controversial. While Daron in particular has long-been a memeably successful economist, the 2001 paper the three recipients co-authored has had a lot of criticism, as has Why Nations Fail, the book Daron and Jim wrote together. There are two classes of criticism. The first is empirical (Gelman has a partial overview here). To make the case for the importance of institutions for economic development, they use an instrumental variable approach (effectively, an indirect way of establishing causality), using settler mortality. This approach has been found to be fragile. This is not the only econometric criticism which threatens to overturn the central result. They also use ropey, fairly arbitrary measures of what an institution is, and what a good one is. Dietrich Vollrath gives a sympathetic but unsparing criticism of this here and here. The second broad critique is conceptual: does the way they think about institutions in fact shed light on the process of economic development? Yuen Yuen Ang criticises their approach here; Pseudoerasmus makes multiple on his BlueSky feed here. My own take is that, though I mainly buy these criticisms, they made significant and lasting contribution to discourse in economics, even if (like Pseud) you think its’s crazy that it took this work for economists to take institutions seriously. Not my favourite Nobel (hello Herbert Simon and Oliver Williamson), but not the worst either. 

  2. A lot of Herbert Simon’s work was ultimately about how people (and organizations) process information. Eric Barker has a fantastic, easy-to-read article about the same topic, and specifically how to be better at processing informationThe central conceit is that it’s not about how intelligent you are in a conventional, as-measured-by-IQ (a horrible measure, in my opinion), but about how self-reflective you are.

  3. Hannah Ritchie has a great piece on her blog condensing her extensive writing about the health effects of temperature change caused by climate changeFor someone who is not knee-deep in this literature, I found it really helpful: it made points that I had never considered, uses data well, and also comes out at in really practical, pragmatic place. And it hugely confirms my own priors that working on low-cost, green cooling is a hugely important area for human welfare and thriving. This is one the areas some of my work on pull financing highlighted, too.

  4. Related, I liked this piece on VoxDev by Chris Barrett and co-authors, on the links between climate change and agricultureThe effects of climate change on agricultural productivity, and vice versa, are becoming better understood in the academic literature, but investment and development cooperation are lagging behind severely. African agriculture suffers from a chronic and extreme lack of investment: in technologies, in information and even in the basic infrastructure required to gather information (e.g. on weather patterns and to make forecasts). This is one of those areas where every new thing I read convinces me more that it’s incredibly important, but I do not yet get a sense that donors and funders are taking it seriously enough. And this, by Wollburg and co-authors including Chris Udry and Doug Gollin reinforces this point: African smallholders are not becoming more productive.

  5. Want productivity hacks? Well, you’re out of luck: Tim Harford has no miracle cures for you, but he does talk you through his biggest mistakes in trying to be more productiveI would like to boastfully say that I have totally avoided his ‘email efficiency trap’ by basically not responding to emails in a timely fashion, but I’m not sure that it’s anything to be proud of.

  6. David Adam in Nature on the origins of peer review: a fun read, particularly some of the photos.

  7. Finally, I’m trying to wean myself of Xitter, especially as it accelerates its descent into a hellscape of imbeciles, lies and abuse, under the ‘leadership’ of Musk. I’ve switched to BlueSky (scepticalranil, of course), and LinkedIn (here), so please do connect if you want to continue to see things I’ve written, or am reposting or commenting on. But I have a request: I have an Instagram (purely personal, very little posting) which I use to mainly watch food videos and follow wine accounts (I follow dimsimlim, a million hungry Sri Lankans and anyone who talks about wine without me wanting to run through a plate-glass window). Who should I be following? After years of only using Twitter, Instagram feels incredibly wholesome to me (possibly because of who I’m following). What are the best food, wine and birding accounts?

Have a great weekend, everyone!

R

Disclaimer

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.