Plenty of Blame to Go Around

The indefatigable Barry Ritholtz has constructed a list of the people who deserve the most blame for the "entire debacle":

1. Federal Reserve Chairman Alan Greenspan
2. The Federal Reserve (in its role of setting monetary policy)
3. Senator Phil Gramm
4-6. Moody’s Investors Service, Standard & Poor’s, and Fitch Ratings (rating agencies)
7. The Securities and Exchange Commission (SEC)
8-9. Mortgage originators and lending banks
10. Congress
11. The Federal Reserve again (in its role as bank regulator)
12. Borrowers and home buyers
13-17. The five biggest Wall Street firms (Bear Stearns, Lehman Brothers, Merrill Lynch,Morgan Stanley, and Goldman Sachs) and their CEOs
18. President George W. Bush
19. President Bill Clinton
20. President Ronald Reagan
21-22. Treasury Secretary Henry Paulson
23-24. Treasury Secretaries Robert Rubin and Lawrence Summers
25. FOMC Chief Ben Bernanke
26. Mortgage brokers
27. Appraisers (the dishonest ones)
28. Collateralized debt obligation (CDO) managers (who produced the junk)
29. Institutional investors (pensions, insurance firms, banks, etc.) for
buying the junk
30-31. Office of the Comptroller of the Currency (OCC); Office of Thrift
Supervision (OTS)
32. State regulatory agencies
33. Structured investment vehicles (SIVs)/hedge funds for buying the junk

Making long lists is so money. Because they are transparent they can actually be critiqued and possibly improved upon. Saying that something is "overrated" or "underrated" always depends on context, but list-making solves that conundrum well. I've often thought that scientific articles might be much improved if authors broke free from the shackles of prose and instead made ordered lists of their ideas.

Here are 10 reasons why we love making lists, here are my friend Danny's top 10 movie characters of all time, here is Wikipedia's list of emerging technologies, and here are my del.icio.us tags for "list"--there is a list of them.

Should Ritalin Be Used by the Healthy?

The British Medical Journal has an interesting two part debate on the question of whether methylphenidate (i.e., Ritalin) should be acceptable for use among healthy students and adults. The non-medical usage rates of this and other types of ADHD medications are high, and indeed it is the only class of prescription drugs for which there are more non-medical users than medical ones. So, whichever side you stand on this debate, it is a difficult topic to ignore.

The "Yes" side, written by John Harris, makes the argument that boosting cognitive abilities is something we should be celebrating. The "study steroid" analogy to sports fails in that education is not a zero sum game. To the extent that a more knowledgeable populace will make society better in some objective way, then improving information storage and cognitive load capacity has definite benefits. And if society does not improve as students learn more, then remind me again why we are subsidizing higher ed?

The "No" side, written by Anjan Charterjee, attacks the positive argument from a number of angles, including fears of diminished creativity, socioeconomic inequity, and possible serious cardiovascular adverse events as a result of intake. The inequity claim is not just a postulation. Students whose family income is above $250,000 are three times more likely to have used prescription stimulants non-medically in the past year than students whose family income is less than $50,000, a larger effect than that seen in other drug use (from a 2007 study, see here). Although the drugs themselves are sometimes free, the inequity may be present because social networks are likely to be divided at least loosely along socioeconomic lines, and social networks are how one hears about and begins to use the drugs non-medically. However, this inequity is similar to the phenomenon in which richer students are more likely to be classified with learning disabilities and get extra time on exams because their parents were rich enough to pay for the tests. And nobody seems to care about that very much.

The "No" side author also makes the tired argument that perhaps more intelligence would be bad for the world, on the basis that "very smart people generating complicated models to distribute financial risk" was a contributing factor to our current economic woes. This is totally unsubstantiated and indeed much of the data points in the opposite direction. More intelligent people are less likely to fall victim to a hodgepodge of cognitive biases (see here), and a more educated and intelligent populace predicts a greater rule of law, a higher political freedom, and an increased GDP in that country (see here).

Despite the benefits, I still fall somewhere on the "No" side of the debate. I think there should be more and better data on the topic before any further steps are taken. For example, almost all of the cognitive research done has been on Ritalin even though Adderall is now just as prevalent. Additionally, the risk of psychological dependence has been basically ignored in college aged adults. Anecdotally, some of my classmates have noted that they "can't study" without the drug or that "it's not worth it"--see here for one of the many examples of this on the internet. Perhaps I am overly risk averse but to me these risks outweigh the potential benefits, both on a personal level and in my opinion about what should be done about society at large.

If you enjoyed this post, perhaps you will enjoy my longer essay on the topic, which you can find here. I discuss the research into neural mechanisms of ADHD drugs, the history and current attitudes about the risk of psychological dependence, and make some propositions about the present with an eye towards the future.

The Non-Decline of the Dark Knight

Last July I predicted that The Dark Knight would drop from #1 on imdb to somewhere between #s 15 and 22, although I conveniently didn't mention a specific time scale. Nevertheless, a year or so is a reasonable amount of time to consider, and since I am sometimes a reasonable person I will admit that yes, I was off. It remains at #7 today. Here are some charts with data from its relatively small decline over the past year. Most of my data points are from the first few weeks, because that was when it was most exciting.


I'm missing a bunch of data points past the first few weeks but you can see in this last one that the chart fits a power function well. The decay will stabilize at equilibrium at some point--I wouldn't expect the movie's rating to drop foreover.

The Dark Knight has set the bar for imdb chart domination in the modern era. Despite its impressive staying power, it, like every movie before it and like every movie after it, has dropped. This is the rule for imdb ratings. The question is whether the imdb rater's tendency to favor new stuff is specific to the movie industry or whether it generalizes to other domains as well. Too bad there are so few quantifiable rating systems.

Why Does Driving Become Less Fun?

Over the past few breaks, I have gone from no driving at college to lots of driving at home, and I've noticed that driving becomes less and less fun the more I do it. Conversations have led me to suspect that this is a general phenomenon. Objectively, contrast the excitement with which a typical sixteen year old feels when they get their license to the average positive affect working adults feel towards commuting, which is lower than any other daily activity. Here are some attempts to explain this:

1) Less novelty means less fun, as in any other experience. In other words, simple habituation to an initially exciting stimuli is all we need to explain the decrease in fun. This is and should be the default assumption, but I don't think it explains why the effect size is so big for driving in particular. Plus, why has driving become more of a chore over time--from 20% considering it so in 1991 to 28% in 2006? There must be more exotic explanations in addition to this basic one, IMNSHO.

2) The more you drive, the more rules you create about how to drive. Specific rules could include things like, "I won't cut people off for no reason," or, "I will resist the urge to honk unless I am truly justified," or "I won't have leaves my bright lights on all the time." Now, once a driver makes rules, it will naturally piss the rule-maker off when other drivers transgress them, especially because there is no clear avenue for retribution. So, the longer a person drives, the more rules he/she will make, and the more adamant the rule-maker will become about his/her existing rules. So, other drivers will be more likely to transgress a veteran driver's rules, and it will be more annoying for the average veteran driver when this happens. These micro-bouts of anger add up and the experience of driving the whole becomes less fun.

3) The more you drive to a specific location, the more confident you are about how long it takes to get there. More veteran drivers generally leave at the exact time that they need to to reach their destination, as opposed to newbies who must give themselves leeway. So veteran drivers are in more of a "rush," and are more annoyed when they miss a light or when some other driver does something stupid to waste their precious commute seconds. These micro-bouts of annoyance sum and make the net driving experience less fun.

4) The more you drive, the more aware you become of all the bad things that could happen while you are driving. These include the possibility of being ticketed for rolling through a stop sign, being in a car crash, or hitting a pedestrian. These events need not actually occur--merely coming close will cause your probabilistic brain to subconsciously reweigh and increase the odds of the event occurring in the future. Your brain's activity will make you more anxious, even though you may not even be consciously aware of why. More anxiety usually means less fun, so driving will become less fun the more often and the more recently you have been driving.

One take-away from all of this is that memory loss is probably the only reason any of us can stand driving at all. We forget our rules, which makes driving more fun; we forget how long it takes for us to get places, which makes driving more fun; we forget all of the bad things that might happen to us, which makes driving more fun. If this is generalizable to other activities, then that's something to consider as our ability to alter memories with neuroengineering moves from fiction to reality.

Can You Destroy This Tumor?

This is a semi-famous thought experiment:

"You are a doctor trying to destroy an inoperable stomach tumor in a patient. You can send a narrow beam of radiation at the tumor, but it destroys the tumor only at a high intensity, which would also destroy the surrounding healthy tissue. At a lower intensity it would spare the healthy tissue but also fail to kill the tumor."

Can you solve it? Karl Dunker was the first to propose the challenge, and it's meant to be tough--only about 10% of participants do so without resorting to their preferred search engine. I'll post the answer in the comments.

The Self-Serving Bias in E-Mail Responding

Eric Schwitzgebel recently conducted an interesting study in which he sent fake e-mails, ostensibly from undergraduates, to various professors and tracked their response rates. Separately, many of these same professors filled out a survey about their attitudes and typical behavior regarding e-mail. Their findings are quite striking.

Professors claimed to respond to e-mail religiously in the survey, as half said that they respond 100% of the time, and nine-tenths said that they respond at least 90% of the time. However, their actual response rates to phony e-mails was between only 54-59% of the time. Moreover, there was no correlation between professor's survey responses about whether it is moral to respond to undergraduate's emails and whether they actually do so. Both of these divergences between beliefs and behavior are classic symptoms of the self-serving bias.

Fighting With the Author

When I read something with the sole goal of understanding the main points, I end up in a fight with the author. When I don't understand what he's saying, I have to slow down my pace. This is annoying, and it means that I'm losing. When I'm basically understanding each of his points, I read at a normal pace. We're tied. But when I already grasp his current point and my internal dialogue is mocking him to get to the next one, then I speed up. That's the fun part, and it means that I'm winning.

When I re-read my old stuff I often end up fighting with myself. Sometimes, it gets ugly.

In Favor of Nuclear Power

Scott Aaronson rants:

Why are no new reactors being built in the US, even while their value as stabilization wedges becomes increasingly hard to ignore? Why are we unwilling to reprocess spent fuel rods like France does? Why do people pin their hopes on the remote prospect of controlled fusion, ignoring the controlled fission we’ve had for half a century? Why, like some horror-movie character unwilling to confront an evil from the past, have we decided that a major technology possibly crucial to the planet’s survival must remain a museum piece, part of civilization’s past and not its future? Of course, these are rhetorical questions. While you can be exposed to more radiation flying cross-country than working at a nuclear reactor for months, while preventing a Chernobyl is as easy as using shielding and leaving on the emergency cooling system, human nature is often a more powerful force than physics.

There is a correlation between understanding the science involved in nuclear reactors and believing that more of them should be used, and Scott is yet another data point. Abre los ojos.

The Carbon Climate Response

A recent paper in Nature by Mathews et al proposes a new mathematical construct for considering the increases in temperature following carbon dioxide emissions. In additional to the typical temperature response depending on increased concentrations of atmospheric CO2, their model takes into account the changes in atmospheric CO2 concentration following changes in CO2 emissions. Essentially they have added a feedback parameter to the standard account.

In their model the total amount necessary to raise global temperatures 2 °C above pre-industrial levels is a mean of 1.4 trillion tons of CO2 emitted, with a 95% confidence interval of 1.0 to 1.9 trillion tons. Currently the world has emitted 0.5 trillion tons of CO2, so in order to stay below the 2 °C level we would need to, on average, limit emissions to 0.8 more trillion tons. Note that zero net future anthropogenic CO2 emissions would be necessary to fully stabilize global mean temperature. That's because cutting emissions would not quickly reduce atmospheric concentration; atmospheric carbon dioxide does not act like your typical pollutant.

Robin Hanson favors geoengineering, which sounds good to me as a temporary fix. Per Eric Drexler's recommendation, we could use thermodynamically efficient molecular pumps in the long run to reverse net atmospheric concentrations. Neither of these are politically favorable because: 1) Most people do not know about them, and 2) No existing set of corporations stand to directly benefit from their development and implementation. Still no villians, but yes unfortunate incentives.

Kobe and the Self-Serving Bias

In the post-game interview tonight following the third game of the NBA finals, Kobe Bryant expressed his frustration over messing up in one of the crucial last plays. Loosely, he said, "I'm used to coming through in these situations... my team trusts me to come through in these situations." So there is little doubt that he thinks that he's good in late game situations.

However, the data does not confirm his intuition. 82games.com recently posted an analysis of game winning shots (HT: Simmons) over the past six years and Kobe's 25% field goal percentage is tied for 71st out of the 76 players analyzed. That means that, relatively speaking, he's pretty bad in the late game. The simplest explanation for the discrepancy between his perception and reality is the faithful self-serving bias.

Nevertheless, he is clearly a pretty good player overall, rated via player efficiency ratings as the sixth best in the league this year. Now, is his overall greatness the reason that he is unable to see the facts as they are? Or, conversely, is his self-serving bias a prominent cause of his overall greatness? Or, is it neither, and he just so happens to be an arrogant asshole? These are the questions I stay up late at night pondering.

Envision Victims But Not Villians

The biggest divergence between narratives and reality, in my view, is the primacy of villains. There is a tendency to blame someone--the greedy investment bankers!, the predatory subprime creditors!, etc.--but almost always these fall apart upon closer analysis. Scott Sumner believes that in arguments and post-hoc economic analysis alike, the smartest policies envision a world with victims but no villians. In the light of either incentives or neurology, villians disappear. We are left with only probability-weighted causes.

Stress and Good Science

In the Q&A following Richard Hamming's 1986 speech at Bell Labs, he reveals that, in his opinion, stress is a pre-requisite for good science:

Question: What about personal stress? Does that seem to make a difference?

Answer: Yes, it does. If you don't get emotionally involved, it doesn't. I had incipient ulcers most of the years that I was at Bell Labs. I have since gone off to the Naval Postgraduate School and laid back somewhat, and now my health is much better. But if you want to be a great scientist you're going to have to put up with stress. You can lead a nice life; you can be a nice guy or you can be a great scientist. But nice guys end last, is what Leo Durocher said. If you want to lead a nice happy life with a lot of recreation and everything else, you'll lead a nice life.

Since he's drawing off of personal experiences, it's hard to tell how generalizable this is, but it's a scary possibility. At the very least it is plausible, because much of the process of experimentation and peer review is out of one's control, especially if you want to do ground-breaking research. For example, I've read (from here) that the consensus among referees is so bad that their recommendations of whether or not to accept a paper only agree 20% of the time. Ouch.

Obama's Cairo Speech

The Tyler Cowens of the world urged us to vote on foreign policy in the most recent presidential election, because on economic issues the major candidates did not differ greatly. Obama's speech last night, the text of which you can find here, is evidence to me of Obama's worth in that domain. Although his tone is optimistic, if you read carefully you will notice that he is actually scaling back foreign policy goals, a more non-interventionist approach which to me is prudent. His use of tenous moral equivalencies, like comparing the adversity that Palestinians currently face to that which once faced slaves in the American South, may have been questionable, but they painted the right empathetic picture. It is useful to maximize one's rhethorical efficacy in order to minimize the need for costly actions. Stylistically, I particularly liked how he sprinkled colons into his transition phrases, like "but let us be clear:" and "make no mistake:," which proved to be highly effective. Overall, bravo? However, David Brooks, who surely follows the issues more closely than I do, does not think so highly of the speech. So take my opinion on the matter with a grain of salt, whatever that means.

Will Someday Ever Come?

In baseball they have this statistic called VORP which signifies how much better a given player is than a fictitious player that the team could pick up and stick at his position. Basically it is a proxy for that player's marginal utility. It's a ruthless statistic, because players are given no credit for making it to the big leagues in the first place.

I've been thinking about VORP and trying to generalize it to other walks of life. It seems that for any competitive position it is instrumentally worthless to only measure what you yourself will accomplish. Instead, you must consider how much better or worse you will be the average person who would replace you if never enter the field, gain acceptance into the prestigious university, receive the NIH research grant, secure some of the limited venture capital funding, or whatever.

I've come to the conclusion that unless you can show by some objective standard that you've identified a niche where you can achieve very high VORP, you might as well just sit back and enjoy the ride. But if think you can accomplish something that nobody else would or could do otherwise, then rejoice, because your VORP will be infinite.

Making You Think

It's a common compliment to say that someone "always makes me think, even when I disagree with him." But this caveat is trivial--of course you think when you disagree with somebody! You think about why they are wrong and why you are right, and you sometimes think about how their parents failed them by raising them to espouse such absurd views.

A more impressive trait would be somebody who makes you think even when you agree with him. It's so easy to nod your head and play along to the company line. Truly deep thinkers will find ways to make you reconsider facets of viewpoints that you didn't even know existed. It's not realistic to be able to make all the people think all the time, but the wisest often make others think when they least expect to.