Dominated decisions

Decision matrices

(Peterson 2017) points out that we can represent decisions with decision matrices. For example, when considering the purchase of home insurance, we have:

Each row (after the first) represents a different action and each column (after the first) represents a different possible state of the world. Their intersections—the four cells that are the combination of an act and a world state—are called outcomes.

Sets of settings

In decision theory (and social choice theory, game theory, mechanism design, etc.), when presented with a decision, it’s often useful to start by taking stock of what information we have available and what information we would like but don’t have. Depending on the result of this assessment, we will have better or worse strategies available. That is, we’d like to determine the best strategy or solution given the information available. And are there better strategies that we could execute with more information? What is that information? For example, we approach the question of “Should we buy home insurance?” very differently if we know the precise chance of our house catching on fire. Without key information like that, we have to resort to second-best strategies.

Dominance

The decision matrix we depicted above reflects one of the simplest possible¹ settings. In particular, we don’t have any probabilities associated with the different states of the world (“Fire” or “No fire”) which makes it a “decision under ignorance”. Another key limitation is that we don’t have a number representing how good or bad each outcome is—that is, our outcomes have not been assigned cardinal utility.

Because this setting is so minimal, it both has wide applicability—it makes very few assumptions that can be contradicted by facts on the ground—and limited insight—the best you can do with minimal information still isn’t very good.

Prose

One of the rules that exemplifies both broad applicability and limited insight is the dominating decision rule. Action A weakly dominates action B if it produces an outcome which is at least as good as that of action B in every state of the world. Action A strongly dominates action B if it produces an outcome which is at least as good as that of action B in every state of the world AND is strictly better than action B in at least one state of the world.

Assorted Links XI

1. An Inside Look At Bolivia’s Aymara-Inspired, Folklore-Futurist Architecture Movement

2. How Different Studies Measure Income Inequality in the US

You’ve probably heard claims about middle class American income stagnating over the past decades and most of the gains in productivity going to the top X%. The following table lists studies that looked at income trends in the US over time. Which of these methods of income analysis sounds like it’s closest to measuring something you’d actually be interested in knowing?

By presenting the analysis plans without the corresponding results, you can arrive at a judgment with a clean conscience—no need to fear that you’re simply approving the study with your favored result. When you’re ready to see what studies and results these descriptions correspond to, look at Table 1 in the linked PDF.

3. Did hominins associate with antelopes?

Together with various antelopes, baboons form multispecies groupings that take advantage of the great vision of the primates and the better smell and hearing of ungulates.

4. Relationship between the Chinese housing and marriage markets

Housing prices in some cities in China have increased more than tenfold in the past decade. They appear to be rising too fast relative to the growth of income.

[…]

Due in part to the one-child policy, there were 120 Chinese men for every 100 Chinese women as of 2005—in some provinces this ratio is as high as 130 to 100. […] One of the most visible symbols of this status competition comes through housing. […] This places a lot of pressure on Chinese families with sons to demonstrate their value through homeownership.

[…]

We found that home prices are higher and home sizes are bigger in cities with more skewed sex ratios. Strikingly, the sex ratio imbalance explained between half and one-third of the increase in housing prices in 25 major cities between 2003 and 2009.

5. Chess steganography

See also Steganography in games: A general methodology and its application to the game of Go.

Anthropological enumerations

Getting food

Foraging

Anatomically modern humans showed up to the party rather late—perhaps as late as only 130,000 years ago. This was right also right around the time Homo sapiens become cognitively modern and capable of symbolic thought. But looking good and thinking symbolically do not a good party make. Everyone would have been leaning against the wall and stealing furtive glances at each other for many millennia until they worked up the courage to finally invent language and talk to each other around 50,000 years ago.

So, regardless of what you use as your benchmark for modernity—anatomic, cognitive, or linguistic, the advent of food production in around 8,000 B.C.E. is relatively recent. That means, for most of human history, we’ve been foragers. “Foragers” are often called “hunter-gatherers” but this name is somewhat misleading. Hunting and gathering each typically contribute about 25-35% of caloric intake while fishing constituted the remaining 30-50%.

There is ongoing debate about just how sweet the pre-historic foraging life was. On one hand, per capita GDP between $90 and $200 for essentially forever doesn’t sound so hot (DeLong 1998) from the perspective of modernity. On the other hand, as we mentioned in a previous post, even modern foragers (who are typically thought to live in more marginal territory than early foragers) work fairly little. For example, the !Kung spend only about 42 hours on foraging, housework and tool-making all together. On the third hand, John “You’ve to break a few billion eggs to make an omelet”¹ Zerzan is on the primitivist side so no thank you.

Food production

Like we said, the earliest food production arose in around 8,000 B.C.E. in the Near East.

Food production perhaps arose because it was the only way to support increased population. At some point, new bands of humans simply ran out of unoccupied territory to move into. Thereafter, population density would have increased beyond what foraging could support and horticulture, more productive per unit area than foraging, would have been the only option. This commonsensical theory of the rise of food production is called the Binford-Flannery model.

An alternative theory is that climate change reduced the availability of wild food supplies.

Regardless of the origin story, there are three major categories of food production:

Horticulture

“Plant cultivation carried out with relatively simple tools and methods”. Probably the earliest form of food production. Shifting cultivation, in which land is worked temporarily and then abandoned while soil nutrients naturally replenish, is a common form. 60 of 186 SCSS cultures are horticultural (variable 246) (Murdock and White 1969).

Intensive agriculture

“Food production characterized by the permanent cultivation of fields and made possible by the use of the plow, draft animals or machines, fertilizers, irrigation, water-storage techniques, and other complex agricultural techniques.” 57 of 186 SCSS cultures are intensively agricultural (variable 246) (Murdock and White 1969).

Pastoralism

“A form of subsistence technology in which food-getting is based directly or indirectly on the maintenance of domesticated animals.” 16 of 186 cultures SCSS are pastoral (variable 246) (Murdock and White 1969).

Pigouvian compendium

We’ve already established that I’m a fan of Pigouvian taxes and correcting externalities. The harms I visit on my neighbor should be the result of malice aforethought; we should have to look each other in the eye rather than shrug in world-weary acknowledgment of systemic perversities. Because of that interest, I wanted a sense of the total magnitude of Pigouvian taxation possible. Are American GDP numbers the result of accounting fraud that would put Enron to shame? How much would American production numbers decrease if we accounted for externalities? If the federal government shared my zeal for technocratic delights, how much of the federal budget could be funded by Pigouvian taxes? How much would an individual’s annual expenses increase if they’d internalized all their externalities and been absolved of their sins?

To answer those questions, I reviewed the academic literature and found every proposed Pigouvian tax I could. I did not include:

General sin taxes

Public health practitioners and others sometimes talk about taxing certain goods on the grounds that they correct for irrationality. Plebes People don’t know about the long-term harmful effects of sugary drinks or lack self-control, for example. Or cigarette taxes should be increased to stop people from enjoying themselves killing themselves prematurely. While there are reasonable arguments (despite the snark above) in support of such taxes, these aren’t the same as Pigouvian taxes. Pigouvian taxes correct for externalities and arise even with rAtIoNaL actors due to inherent failures of markets; these other taxes try to nudge toward actions that don’t create externalities and wouldn’t occur with rAtIoNaL actors.

Uncalibrated taxes

There are many jurisdictions that have taxes on externality-producing consumption—think cigarette taxes or alcohol taxes. However, these are just as likely to be the result of smoky backroom deals as of analysis grounded in an estimation of the externalities imposed by consumption. Thus, I excluded them and only looked for taxes (real or proposed) where numbers were intended to precisely ‘internalize’ externalities.

The results of this review are presented in the table below. The externalities associated with emitting carbon and driving are the largest by far. If we sum up all the known externalities listed in the table, we find that they come to $679 billion per year in the US. This is around 3.5% of US GDP and around 15% of US federal spending. The per capita cost of these externalities is around over $2150 per year. (The sum of externalities is described on annual basis and so excludes quantities which are stocks rather than annual flows. In particular, obesity and SME debt are current totals rather than annual changes.)

Assorted Links X

1. I regret nothing pic.twitter.com/OCo4NiOxho

   — Unlearning Economics ((???)) October 3, 2018

2. Witches Outnumber Presbyterians in the US

   It makes sense that witchcraft and the occult would rise as society becomes increasingly postmodern. […] Plus, Wicca has effectively repackaged witchcraft for millennial consumption.

   […]

   a May 2017 editorial in the Los Angeles Times written by novelist Diana Wagman openly spoke of putting a curse on the president and encouraged others to cast similar spells in order to #BindTrump.

3. Why are relatively poor people not more supportive of redistribution?

   People tend to think they are in the middle of the income distribution, regardless of whether they are rich or poor.

   […]

   Surprisingly, telling poor people that they are poorer than they thought makes them less concerned about the gap between the rich and poor in their country

   […]

   Upon receiving the treatment this led people to realise two points. Firstly, there are fewer people in their country with a living standard they considered to be relatively poor than they had thought. Secondly, what they had considered to be an ‘average’ living standard (their own standard of living) is actually relatively poor compared to other people in their country.

4. Unrestricted adversarial examples challenge

   Astonishingly, no known machine learning system can reliably tell a bird from a bicycle when there’s an adversary involved.

   My colleagues and I have proposed a contest to see if we can change this.

5. Preferences for Life Saving Programs: How the Public Discounts Time and Age

   With regard to discount rates for life saving, we find that individuals do, indeed, discount future lives saved. In fact, their discount rate for lives saved is almost as high as their real discount rate for money. The median respondent in our surveys requires that 2.3 lives be saved five years from now for every life saved today—a discount rate of 16.8%. (By contrast, the median rate at which respondents discount money over this period is 20%.) The median respondent requires that 44 lives be saved 100 years from today for every life saved today, implying a discount rate of 3.4% fora 100-year horizon.

Gas taxes for thee, but not for me

Paris and other French cities have recently been the site of large and heated (there were fires) protests. The most prominent symbol of the protests is the high-visibility gilets jaunes which all French motorists are required to own. This symbol is fitting for a series of protests that coalesced in opposition to an increase in the gas tax. While this protest (and any other protest) isn’t about a single grievance, it certainly seems to signify something about the popular opinion of gas taxes.

These protests pair somewhat uncomfortably¹ with the popular march against climate change in Paris just three months ago.

This pattern seems common: Acknowledgment that global warming and excessive fossil fuel use are problems which must be addressed followed by reluctance or opposition to concrete responses (Leiserowitz 2006).

Other examples include:

Washington Initiative 732

A 2016 revenue neutral carbon tax that would have used revenues from the tax to reduce the (highly regressive) state sales tax and increase a low-income tax credit. It lost despite Washington’s reputation for environmental concern.

Washington Initiative 1631

A 2018 carbon tax that would have used revenue from the tax to invest in green initiatives and other infrastructure projects. Again, the measure did not pass.²

Australian carbon tax

Introduced in 2012 by the Labor government, it was repealed in 2014 by the Liberal government.

(Carbon taxes aren’t always doomed to failure. British Columbia has had a carbon tax of $35 per tonne in place since 2008. Sweden has the world’s highest carbon tax at about $138 per tonne. California recently voted down a repeal of recent gas tax increases.)

Pigouvian taxes

What are Pigouvian taxes?

So gas and carbon taxes are controversial with the public. Not so for economists and technocrats. They are both examples of Pigouvian taxes. In brief, Pigouvian taxes seek to correct market failures arising from negative externalities. A negative externality is any cost generated by a market activity that is not priced into the market exchange.

For example, local air pollution caused by combustion of gasoline harms other nearby people—think especially of those who don’t even own a car—who receive nothing in exchange for bearing this harm. Because these costs aren’t included in the price of gasoline, gas is cheaper than it ought to be, all things considered. This leads to overconsumption of gasoline.

A Pigouvian tax tries to remedy this market failure by making the ‘invisible’ costs of externalities manifest via a tax. If the total external costs of driving—due to externalities like greenhouse warming, congestion and local pollution—amount to $1.76 per gallon (an estimate from (Parry, Walls, and Harrington 2007)), a tax of $1.76 on each gallon forces the gasoline purchaser to ‘internalize’ those costs—account for the social harm they are creating with their actions.

A tax only an economist could love

“Economists are in almost universal agreement that, in concept, pollution taxes are the most cost-effective means of reducing pollution” (Hsu 2009). In a direct survey, 65% of economists attested that there should be an overall increase in energy taxes (Whaples 2006). Gregory Mankiw keeps a partial list of prominent economists that support Pigouvian taxes in the form of the membership rolls of the Pigou Club.

Contrariwise, only 5% of the general public supported a tax on driving in a 2007 survey.

For a (very accessible) fuller discussion in support of Pigouvian taxes from an economist, see (Mankiw 2009).

Reasons to oppose

I’ll confess myself to be on the side of economists when it comes to Pigouvian taxes. I’m then left with the question, why are they so unpopular with the general public? There are many possible reasons which we’ll now rehearse (Though we will stick to arguments where there’s something interesting to say about Pigouvian taxes specifically; we won’t rehash arguments about whether the government should ever intervene in the market, can be trusted, &c.) . Since the case for Pigouvian taxes rests on both positive (these are the effects of Pigouvian taxes) and normative (these effects are good) premises, we’ll categorize³ the objections as:

1. Misapprehensions of the positive
2. Disagreements with the positive
3. Misapprehensions of the normative
4. Disagreements with the normative

Assorted links IX

1. GBD Compare | Viz Hub

2. Why Arabic Is Terrific

Nearly all Arabic words consist of a three-consonant root slotted into a pattern of vowels and helper consonants. The root gives the word its base meaning, while the pattern modifies this meaning in a systematic and predictable way. This idea is so cool that you’d think it came from a constructed language, and yet Arabic has actual native speakers who live completely normal lives and will not try to talk to you about Runescape.

[…]

Here are some common patterns using the root k t b, whose basic meaning is ‘writing’:

pattern	pattern meaning		result
m–a-a	place name	مكتبة	maktaba (library)
-aa-i-	active participle	كاتب	kaatib (writer)
ma–uu-	passive participle	مكتوب	maktuub (written)
-a-a-a	basic verb	كتب	kataba (to write)
a–a-a	causative verb	أكتب	aktaba (to dictate)
-i-aa-	noun	كتاب	kitaab (book)
-u-u-	plural noun	كتب	kutub (books)

3. No, it’s not The Incentives—it’s you

In the last few years, I’ve noticed that uncomfortable discussions about questionable [research] practices disproportionately seem to end with a chuckle or shrug, followed by a comment to the effect that we are all extremely sophisticated human beings who recognize the complexity of the world we live in, and sure it would be great if we lived in a world where one didn’t have to occasionally engage in shenanigans, but that would be extremely naive, and after all, we are not naive, are we?

[…]

Imagine if every time you went to your doctor—and I’m aware that this analogy won’t work well for people living outside the United States—she sent you to get a dozen expensive and completely unnecessary medical tests, and then, when prompted for an explanation, simply shrugged and said “I know I’m not an angel—but hey, them’s The Incentives.”

4. South Koreans lock themselves up to escape prison of daily life

“This prison gives me a sense of freedom,” said Park Hye-ri, a 28-year-old office worker who paid $90 to spend 24 hours locked up in a mock prison.

[…]

Clients get a blue prison uniform, a yoga mat, tea set, a pen and notebook. They sleep on the floor. There is a small toilet inside the room, but no mirror.

5. Swedish ISP Protests ‘Site Blocking’ by Blocking Rightsholders Website Too

[…] after academic publisher Elsevier applied for an order to ban a series of domain names, including Sci-Hub.

[…]

So, in addition, Bahnhof has gone ahead and banned its visitors from accessing the official Elsevier.com website as well.

Anthropological Clickbait

Curios from (Ember, Ember, and Peregrine 2014) follow. These don’t fit into subsequent posts, but may pique your interest in said posts. No judgment intended or permitted—we’re all Boasians here.

Culture change

On great men of history

Within 50 years, paper was being made in many places in central China. Although the art of papermaking was kept secret for about 500 years, it was distributed as a commodity to much of the Arab world through the markets at Samarkand. But when Samarkand was attacked by the Chinese in A.D. 751, a Chinese prisoner of war was forced to set up a paper mill. Paper manufacture soon spread to the rest of the Arab world

On inventing

In stimulus diffusion, knowledge of a trait belonging to another culture stimulates the invention or development of a local equivalent. A classic example of stimulus diffusion is the Cherokee syllabic writing system created by a Native American named Sequoya so that his people could write down their language. Sequoya got the idea from his contact with Europeans.

Childhood

On the prevalence of infant mortality

cross-culturally, parent–child play is exceedingly rare […] Lack of play with parents may be related to the same factor that probably explains high responsiveness to infant physical needs—high mortality of infants and the psychological need of parents to create emotional distance.

On appropriate behavior

Some societies actively encourage children to be aggressive, not only to each other but even to the parents. Among the Xhosa of southern Africa, 2- or 3-year-old boys will be prodded to hit each other in the face while women look on laughing. Similar behavior is described for the Gapun of Papua New Guinea; even raising a knife to an older sibling is rewarded. Yanomamö boys of the Venezuelan-Brazilian Amazon are encouraged to be aggressive and are rarely punished for hitting either their parents or the girls in the village.

[…]

Although Ariwari is only about 4 years old, he has already learned that the appropriate response to a flash of anger is to strike someone with his hand or with an object, and it is not uncommon for him to give his father a healthy smack in the face whenever something displeases him.

Communication and language

On gendered language

In Japan, males and females use entirely different words for numerous concepts (e.g., the male word for water is mizu; the female version is ohiya)

On forensic linguistics

Some linguists believe that the approximate location of a protolanguage is suggested by the words for plants and animals in the derived languages. More specifically, among these different languages, the words that are cognates—that is, words that are similar in sound and meaning—presumably refer to plants and animals that were present in the original homeland. So, if we know where those animals and plants were located 5,000 years to 6,000 years ago, we can guess where PIE people lived.

On universal grammar

[Bickerton] says that the “errors” children make in speaking are consistent with the grammar of creoles. For example, English-speaking children 3 to 4 years old tend to ask questions by intonation alone, and they tend to use double negatives, such as “I don’t see no dog,” even though the adults around them do not speak that way