In a clip that has gained some infamy around the internet, Buzz Bissinger (the Pulitzer prize winning sports journalist), berated the entire sports blogosphere in a profanity-laden rant criticizing, among other things, the bloggers' use of profanity. Rage often blinds us to irony.
Bissinger's appearance on the show "Costas Now" back in April has been widely covered throughout the web. But while Bissinger chides bloggers for (supposedly) lowering the level of discourse in the media, his motives may have a subtle economic basis.
In a later (and calmer) statement, Bissinger stated, "I do consider blogging not only a threat to journalists, but to society because it's constant dumbing down. I cast too wide a net. But unfortunately, cruelty sells in our society." Leonard Shapiro, writing in the Washington Post, defended Bissinger, lamenting, "Bissinger's concerns should be all of our concerns. Do we want our sports-infatuated kids to grow up reading Deadspin and Kissing Suzy Kolber (don't ask), or would we prefer them to peruse the internet or their local library to read the wonderful work of Red Smith, Shirley Povich, Jim Murray, Dan Jenkins and yes, most definitely Buzz Bissinger?"
This argument has a false premise. It clearly assumes that traditional media sportswriters maintain high standards for journalism and prose, while blogs are simply low-brow. This is a dubious assumption, however. While there are many great sportswriters, newspapers are also full of rambling, illogical and widely inaccurate sports diatribes. The blog FireJoeMorgan.com (which does contain some profanity, but also analyzes baseball and baseball media through a sophisticated statistical lens) has made a name for itself gutting poorly written and researched pieces by well known sportswriters. Don't take my word for it. Read through these breakdowns of articles written by Bill Plaschke of the Los Angeles Times. It's worth mentioning that Plaschke was once named National Sports Columnist of the Year by the Associated Press.
Bissinger sounds like a candle-maker hearing news of the invention of the light bulb. His first reaction is denigrate the new product and emphasize what makes his work unique and the true standard for quality. He is resentful of bloggers who spout their ideas with impunity and dare to enter the arena with someone who has "spent 40 years of [their] life trying to perfect the craft".
The insidious part of Bissinger's argument is his implicit portrayal of readers. Will many people be drawn to sensational sports blogs? Perhaps. But will this lead to the dumbing down of America? Probably not. Consumers have the ability to make choices for themselves. Greater variety of choices means that people can find the media source (or sources) that fits their preference.
If, as Bissinger asserts, blogs and other non-traditional media sources produce negative outcomes, maybe they should be regulated by the government. The FCC could license any writer seeking to create media for mass consumption, making it illegal to write pieces that are profane or badly written. Certainly it would be easy for a government agency to come to an objective definition of "profane" or "badly written".
Or maybe we can just accept the democratization of media and trust that consumers will, in the end, make the right decisions. In Touch magazine still hasn't put the New Yorker out of business, and there's a reason for that. The two magazines provide different products that appeal to different consumers. We shouldn't begrudge people their choices. And we shouldn't have to shout that we have spent "40 years" perfecting our craft; if the product is really better, consumers will eventually figure that out. And there's another irony: a member of the sports industry who's afraid of a little competition.
Tuesday, July 29, 2008
Thursday, July 24, 2008
Too Scary to Watch?
Dan Ariely asks a provocative question: are we overreacting to the price of gas?
No other price has as strong a political effect as the price of gas. Some presidents have been brought down by it. But while the price of gas is indisputably an important variable in our economy, it is not the only consumer good that has increased in price, nor is it the one that has increased the most.
Gas, however, is unique in that when we buy it, we stare at the running meter. As a result, we experience the increased cost of gas more vividly than other price increases. Similarly, there seem to be psychologically-relevant price thresholds for gas. The price increase from $3.50 to $3.90 per gallon is not as salient as the increase from $3.90 to $4.10 because the latter increase has crossed the $4 mark.
Judging by the letters to the editor, Ariely's argument hasn't been well received. As one woman wrote, "If Dan Ariely’s purpose in writing his Op-Ed article was to make me like the fact that I am now paying more than $4 a gallon for gas, he is mistaken."
But there may be something to what he's saying. Areily, a well known behavioral economist, is oriented to look for economic situations where people systematically deviate from the rational price theory model. A rational agent wouldn't care about arbitrary price thresholds or whether they watched the price climb as they pumped; rather he or she would only care about the price of the good, the price of substitute goods and their budget constraint.
In this week's NY Times op-ed podcast, Areily discusses anecdotal evidence of people taking thousands of dollars of losses selling their gas-guzzling SUVs in an attempt to save money on gas. This does not make universal economic sense. Consider the example of a Cadillac Escalade owner, which Areily uses in the podcast. He bought this behemoth less than a year ago for $54,000, back when the price of gas was more reasonable. Now he's stuck getting 14 mpg with gas prices over $4.00 a gallon. However, in an environment of high gas prices he can't get anywhere near what he paid for the car. In Areily's example, the SUV owner sold the car at roughly a $20,000 loss. Does this make sense? Well, if he drives 15,000 miles per year and gas increases from $4.00 per gallon to $5.00 per gallon, then his gas bill will increase by $1,072 per year. That's a lot. But it will be years before he recoup the loss on the car, assuming he even owns the car that long.
Bryan Caplan made a similar point. He observes that people have been searching harder to find cheaper gas than they did when the price was lower. While gas everywhere is more expensive, there has been no increase in the variability in gas prices. The difference between the highest and lowest gas prices is no different than it ever was, which means that the savings from searching is also the same. On the other hand, driving around searching for cheap gas is relatively more expensive.
Of course both examples are anecdotal, but they highlight some of the irrationality people exhibit when the price of gas goes up. High gas prices have caused real pain for people. But we shouldn't make things worse on ourselves.
No other price has as strong a political effect as the price of gas. Some presidents have been brought down by it. But while the price of gas is indisputably an important variable in our economy, it is not the only consumer good that has increased in price, nor is it the one that has increased the most.
Gas, however, is unique in that when we buy it, we stare at the running meter. As a result, we experience the increased cost of gas more vividly than other price increases. Similarly, there seem to be psychologically-relevant price thresholds for gas. The price increase from $3.50 to $3.90 per gallon is not as salient as the increase from $3.90 to $4.10 because the latter increase has crossed the $4 mark.
Judging by the letters to the editor, Ariely's argument hasn't been well received. As one woman wrote, "If Dan Ariely’s purpose in writing his Op-Ed article was to make me like the fact that I am now paying more than $4 a gallon for gas, he is mistaken."
But there may be something to what he's saying. Areily, a well known behavioral economist, is oriented to look for economic situations where people systematically deviate from the rational price theory model. A rational agent wouldn't care about arbitrary price thresholds or whether they watched the price climb as they pumped; rather he or she would only care about the price of the good, the price of substitute goods and their budget constraint.
In this week's NY Times op-ed podcast, Areily discusses anecdotal evidence of people taking thousands of dollars of losses selling their gas-guzzling SUVs in an attempt to save money on gas. This does not make universal economic sense. Consider the example of a Cadillac Escalade owner, which Areily uses in the podcast. He bought this behemoth less than a year ago for $54,000, back when the price of gas was more reasonable. Now he's stuck getting 14 mpg with gas prices over $4.00 a gallon. However, in an environment of high gas prices he can't get anywhere near what he paid for the car. In Areily's example, the SUV owner sold the car at roughly a $20,000 loss. Does this make sense? Well, if he drives 15,000 miles per year and gas increases from $4.00 per gallon to $5.00 per gallon, then his gas bill will increase by $1,072 per year. That's a lot. But it will be years before he recoup the loss on the car, assuming he even owns the car that long.
Bryan Caplan made a similar point. He observes that people have been searching harder to find cheaper gas than they did when the price was lower. While gas everywhere is more expensive, there has been no increase in the variability in gas prices. The difference between the highest and lowest gas prices is no different than it ever was, which means that the savings from searching is also the same. On the other hand, driving around searching for cheap gas is relatively more expensive.
Of course both examples are anecdotal, but they highlight some of the irrationality people exhibit when the price of gas goes up. High gas prices have caused real pain for people. But we shouldn't make things worse on ourselves.
Monday, July 7, 2008
More on trade (sorry, no witty Kubrick reference this time)
Following on the trade theme, consider the following facts about US trade:
One of the biggest trade issues discussed in the campaigns has been NAFTA. In my last post I cited a quote from Barack Obama in which he said, "Well, I don't think NAFTA has been good for America -- and I never have". But the empirical evidence doesn't implicate NAFTA in the downfall of American manufacturing. David Leonhardt, writing in the New York Times states:
The focus on trade shifts our attention away from the real factors that determine wage inequality and job creation, particularly technology and skills. Austan Goolsbee, Obama's economic adviser, estimates that roughly 80% of income inequality in the US can be explained by changes in technology. Highly educated workers have benefited disproportionately from technological change. In 1980, college graduates earned on average 30 percent more than those with only high school diplomas. Today, that difference has widened to 70 percent. Over the same period, the average earnings of people with advanced degrees went from 50% more than workers without degrees to 100% more.
Unfortunately, stoking trade fears is a cheap and effective means for politicians to seem like they're "doing something" about the economy. Congress can easily derail CAFTA or some other trade agreement if voters are concerned. The impact any one such deal would be slight to the American economy. But if voters are really concerned about jobs, they shouldn't look to protectionism as a solution. The only way to change trends in job creation and income inequality is to improve the skill level of the American workforce; and this can only be achieved by reducing educational inequalities. But that's a big task. It's much easier to blame people who talk funny.
- imports account for only 16.7% of US Gross Domestic Product (GDP) and imports from China account for 2.2%
- between 60% and 70% of the US economy faces virtually no international competition (including low-wage jobs like auto mechanics, high-wage jobs like doctors and the 18.5 million government employees)
- Chinese exports only overlap with between 5% and 10% of the US economy
One of the biggest trade issues discussed in the campaigns has been NAFTA. In my last post I cited a quote from Barack Obama in which he said, "Well, I don't think NAFTA has been good for America -- and I never have". But the empirical evidence doesn't implicate NAFTA in the downfall of American manufacturing. David Leonhardt, writing in the New York Times states:
When Nafta took effect on Jan. 1, 1994, Ohio had 990,000 manufacturing jobs. Two years later, it had 1.03 million. The number remained above one million for the rest of the 1990s, before plummeting in this decade to just 775,000 today. It's hard to look at this history and conclude Nafta is the villain. In fact, Nafta did little to reduce tariffs on Mexican manufacturers, notes Matthew Slaughter, a Dartmouth economist. Those tariffs were already low before the agreement was signed.And yet candidates on both sides of the aisle have cited trade as a major concern for the American economy. Some even promised to bring manufacturing jobs back to Michigan. However, this stance misinterprets the structural changes the American economy has experienced over the past twenty years.
The focus on trade shifts our attention away from the real factors that determine wage inequality and job creation, particularly technology and skills. Austan Goolsbee, Obama's economic adviser, estimates that roughly 80% of income inequality in the US can be explained by changes in technology. Highly educated workers have benefited disproportionately from technological change. In 1980, college graduates earned on average 30 percent more than those with only high school diplomas. Today, that difference has widened to 70 percent. Over the same period, the average earnings of people with advanced degrees went from 50% more than workers without degrees to 100% more.
Unfortunately, stoking trade fears is a cheap and effective means for politicians to seem like they're "doing something" about the economy. Congress can easily derail CAFTA or some other trade agreement if voters are concerned. The impact any one such deal would be slight to the American economy. But if voters are really concerned about jobs, they shouldn't look to protectionism as a solution. The only way to change trends in job creation and income inequality is to improve the skill level of the American workforce; and this can only be achieved by reducing educational inequalities. But that's a big task. It's much easier to blame people who talk funny.
Friday, July 4, 2008
Rise of the machines, or how I learned to stop worrying and love trade
It's been a tough election cycle for proponents of trade. In particular, Hilary Clinton and Barack Obama turned the Democratic nomination race into a contest to see who hates trade the most. While campaigning in Ohio a few months ago, Obama declared:
"One million jobs have been lost because of NAFTA, including nearly 50,000 jobs here in Ohio. And yet, 10 years after NAFTA passed, Sen. Clinton said it was good for America. Well, I don't think NAFTA has been good for America -- and I never have"
Now Obama, the Democrat's presumptive nominee, has proposed a tax credit that is aimed at keeping jobs from moving overseas.
Why all the focus on trade? The concerns center on the decline of manufacturing employment and stagnant wages for blue collar workers.
Are these concerns warranted? Economic theory indicates that trade with developing countries could put downward pressure on wages for poorer Americans. However, empirical investigation of this issue has suggested that this effect is not that large. A recent book by Harvard economist Robert Lawrence shows that the gap between white- and blue-collar workers has not risen that much since the late 1990s when China's global integration accelerated and that the wages of the least skilled have improved relative to those in the middle. (see here for a larger discussion of these issues).
A large part of the problem here is disentangling the separate effects of trade and technology. Wages are closely tied to productivity. The main reason that American workers earn more money than their Chinese counterparts is that they produce more stuff in the same amount of time. Of course, one of the main factors that increase productivity is technology.
However, technology is a double edged sword. While technology raises productivity (and thus wages) it also eliminates many jobs. Consider this: despite losing 4 million manufacturing jobs between 1998 and 2007, US manufacturing output increased by 22%. Thanks to machines, we can make more stuff with less people.
What's interesting is despite the fact that technology has much more effect on manufacturing jobs than trade, politicians are not warning us against the impending robot threat. None except Arnold Schwarzenegger that is. And yet trade and technology have essentially the same impact: greater economic efficiency, which leads to lower prices and higher standards of living.
Politicians railing against technology would be laughed at as kooks. Certainly John McCain, who is already dealing with concerns about his age, wouldn't want to seem anti-progress. No one would support a tax credit for business that avoid using computers or other machinery.
However, unlike technology, foreigners represent salient fear for the public. Bryan Caplan has written extensively on the issue. There is a tendency to talk about trade with other countries in terms of it being a "race" or a "war", when in reality trade is mutually beneficial. Further, trade is a policy that politicians can change; technology is something they have less control over. So even if they have the same impact, it is more effective for politicians to rail against cheap labor in southeast Asia than to hate those adorable robots.
The good news is that we really don't need to fear either. Trade creates new economic opportunities and lower prices, which raise living standards. And recent research has shown that trade actually increases the purchasing power of the poor more than the rich, helping to stem inequality. Technology has largely the same effect. Despite the loss of 4 million manufacturing jobs over the last 10 years, unemployment has remained fairly constant. Technology may eliminate some jobs, but it creates many others.
So don't hate trade. And don't hate the machines either. Both improve your life in countless ways you don't even see.
"One million jobs have been lost because of NAFTA, including nearly 50,000 jobs here in Ohio. And yet, 10 years after NAFTA passed, Sen. Clinton said it was good for America. Well, I don't think NAFTA has been good for America -- and I never have"
Now Obama, the Democrat's presumptive nominee, has proposed a tax credit that is aimed at keeping jobs from moving overseas.
Why all the focus on trade? The concerns center on the decline of manufacturing employment and stagnant wages for blue collar workers.
Are these concerns warranted? Economic theory indicates that trade with developing countries could put downward pressure on wages for poorer Americans. However, empirical investigation of this issue has suggested that this effect is not that large. A recent book by Harvard economist Robert Lawrence shows that the gap between white- and blue-collar workers has not risen that much since the late 1990s when China's global integration accelerated and that the wages of the least skilled have improved relative to those in the middle. (see here for a larger discussion of these issues).
A large part of the problem here is disentangling the separate effects of trade and technology. Wages are closely tied to productivity. The main reason that American workers earn more money than their Chinese counterparts is that they produce more stuff in the same amount of time. Of course, one of the main factors that increase productivity is technology.
However, technology is a double edged sword. While technology raises productivity (and thus wages) it also eliminates many jobs. Consider this: despite losing 4 million manufacturing jobs between 1998 and 2007, US manufacturing output increased by 22%. Thanks to machines, we can make more stuff with less people.
What's interesting is despite the fact that technology has much more effect on manufacturing jobs than trade, politicians are not warning us against the impending robot threat. None except Arnold Schwarzenegger that is. And yet trade and technology have essentially the same impact: greater economic efficiency, which leads to lower prices and higher standards of living.
Politicians railing against technology would be laughed at as kooks. Certainly John McCain, who is already dealing with concerns about his age, wouldn't want to seem anti-progress. No one would support a tax credit for business that avoid using computers or other machinery.
However, unlike technology, foreigners represent salient fear for the public. Bryan Caplan has written extensively on the issue. There is a tendency to talk about trade with other countries in terms of it being a "race" or a "war", when in reality trade is mutually beneficial. Further, trade is a policy that politicians can change; technology is something they have less control over. So even if they have the same impact, it is more effective for politicians to rail against cheap labor in southeast Asia than to hate those adorable robots.
The good news is that we really don't need to fear either. Trade creates new economic opportunities and lower prices, which raise living standards. And recent research has shown that trade actually increases the purchasing power of the poor more than the rich, helping to stem inequality. Technology has largely the same effect. Despite the loss of 4 million manufacturing jobs over the last 10 years, unemployment has remained fairly constant. Technology may eliminate some jobs, but it creates many others.
So don't hate trade. And don't hate the machines either. Both improve your life in countless ways you don't even see.
Wednesday, July 2, 2008
Playing with violence
A US District Court in Minnesota recently lost its case against violent video game purchasing by minors. The state law attempted to fine underage buyers for obtaining videos that were rated as mature. The idea was that violent video games harm children.
The judge found that "there is no showing whatsoever that video games, in the absence of other violent media, cause even the [slightest] injury to children." So, it's worth taking a look at how violent media might cause harm to minors. Often the debate around dangerous media in the US is one waged in the political sphere divided by party lines with no real reference to concrete developmental theory within child psychology.
Traditionally, Piagetian theory presents stages that a person passes through from infancy to adulthood, gaining crucial cognitive skill sets along the way. Most notably, children over 7 gain the ability to understand other points of view. It could be argued that prior to that a child playing a video game may have a difficult time separating themselves from the action on screen. Could being killed or killing in a video game bring on Posttraumatic Stress Disorder (PTSD) the anxiety disorder that can follow the survival of a traumatic event? Unlikely. Particularly since in the magical world of the video realm, violence occurs but there is always a replay.
Most of the attacks on violent video games come from behaviorism (people are what they do, and they do what they do for expected incentives). A game that rewards children for fighting virtually, might inspire them fight in reality. However the theory's main tenets are also part of the argument's downfall. Behaviorism notoriously ignores cognition and asks psychologists to analyze only the measurable behavior of a subject, making it important to have concrete examples of violent acts from video game players.
Social psychology and psychoanalytical each suggest that children get their moral beliefs from their society's infrastructure and the authority figures present in their early childhood. These theories could be applied to suggest that violent media plays the role of authority figure or social model in the minds of children and then reinforces violence as an excepted model of behavior. The idea that something like Grand Theft Auto 4 could replace a parent in the formation of the superego is a scary one and would require a very young child to spend a very long time playing the game.
I think the conclusion to draw is that virtual violence for the very young, who are unable to have varying points of view, would still need to spend a lot of time playing and translate their experience into reality in order to be significantly effected by the game.
The judge found that "there is no showing whatsoever that video games, in the absence of other violent media, cause even the [slightest] injury to children." So, it's worth taking a look at how violent media might cause harm to minors. Often the debate around dangerous media in the US is one waged in the political sphere divided by party lines with no real reference to concrete developmental theory within child psychology.
Traditionally, Piagetian theory presents stages that a person passes through from infancy to adulthood, gaining crucial cognitive skill sets along the way. Most notably, children over 7 gain the ability to understand other points of view. It could be argued that prior to that a child playing a video game may have a difficult time separating themselves from the action on screen. Could being killed or killing in a video game bring on Posttraumatic Stress Disorder (PTSD) the anxiety disorder that can follow the survival of a traumatic event? Unlikely. Particularly since in the magical world of the video realm, violence occurs but there is always a replay.
Most of the attacks on violent video games come from behaviorism (people are what they do, and they do what they do for expected incentives). A game that rewards children for fighting virtually, might inspire them fight in reality. However the theory's main tenets are also part of the argument's downfall. Behaviorism notoriously ignores cognition and asks psychologists to analyze only the measurable behavior of a subject, making it important to have concrete examples of violent acts from video game players.
Social psychology and psychoanalytical each suggest that children get their moral beliefs from their society's infrastructure and the authority figures present in their early childhood. These theories could be applied to suggest that violent media plays the role of authority figure or social model in the minds of children and then reinforces violence as an excepted model of behavior. The idea that something like Grand Theft Auto 4 could replace a parent in the formation of the superego is a scary one and would require a very young child to spend a very long time playing the game.
I think the conclusion to draw is that virtual violence for the very young, who are unable to have varying points of view, would still need to spend a lot of time playing and translate their experience into reality in order to be significantly effected by the game.
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