Friday, October 31, 2008

Rationality and Cunning

It's official: kids these days are dumber:

http://www.economist.com/world/britain/displaystory.cfm?story_id=12516456&fsrc=rss

I particularly like the following quote from the article:

"Britain's unusually early start to formal education may make things
worse, as infants are diverted from useful activities such as making
sand-castles and playing with water into unhelpful ones, such as
holding a pen and forming letters."

The author completely serious. Numerous sources agree that the best
way to build good critical thinking thinking skills is to go out and
interact with reality. Excessive classroom education produces kids
who only know how to memorize and repeat things. Their education is
artificial, increasingly disconnected from reality. They are simply
performing random tasks for incomprehensible reasons.

This kind of thing ties into some thoughts I have been mulling over
regarding different types of intelligence. Specifically, think of the
difference between rationality and cunning.

Rationality what people usually mean when they say 'intelligence.' It
is the ability to proceed logically through a set of procedures,
carefully weighing alternatives. It is what IQ tests measure. It is
the kind of thing that gives you good grades in school and makes you a
useful corporate drone. There is some critical thinking involved, but
it is not really essential.

Cunning, on the other hand, is a very different type of intelligence.
It is kind of like a cross between wisdom and survival instinct. It
is the ability to identify and solve problems quickly, almost
subconsciously. It is the ability to gather information about reality
and convert that information into action. It is the ability to put
resources to their most effective use. Most importantly, it allows
its possessor to do things that, at a gut level, make sense.

This kind of intelligence that is either ignored or actively
discouraged. Cunning allows people to break rules, to question
stupidity, and to frustrate the system. However, for almost all of
human history, cunning was far more important to survival than
rationality. Cunning lets you prosper in a complicated and
unpredictable world. Rationality lets you prosper in a regimented,
stable society.

I'm sure any teacher who has been around for more than a few years
knows about this distinction, even if they would not use the words I
am using. They will have students who are very cunning but not at all
rational, or students who are very rational but have no cunning. The
former often drop out and then go on to lead successful lives, while
the latter often stay in school forever, becoming an integral part of
the ivory tower community.

Possibly as a result of this self-reinforcing loop, our educational
culture, and most of our society, seems devoted to nurturing
rationality above all else. Rationality is seen as the only measure
of intelligence. But this is clearly misguided. Cunning is a vital
skill, and it becomes even more important as the world becomes more
complex.

I think that the disconnect between rationality and cunning helps
explain a few notable cultural divides. One of the biggest is between
the academic world and the business world. Academia is based almost
entirely on rationality. Successful business executives must be
cunning. Rationality is less important; a cunning person can easily
hire rational people for tasks that require rationality.

But academics often do not respect cunning, or even know of its
existence, because they do not know how to measure it. By their
standards of intelligence, businessmen are stupid, because they
possess less rationality than academics do. So the academic concludes
that businessmen simply get lucky, or that they are cheating somehow.
They then feel perfectly justified in taking money away from
businessmen and giving it to rational people, in order to improve the
world.

Of course, this rarely works. Cunning people are usually better than
rational people at managing money.

Thursday, October 30, 2008

Data and Identity

Sometimes my knowledge of computers gives me a unique way of looking
at philosophical problems.

We were discussing identity. Philosophers have all kinds of questions
that force you to think carefully about your beliefs The professor
asked us, "Suppose you were sent through a teleporter from one end of
the world to another. And as you do, the teleporter makes an
identical copy of you. Now imagine that a mad scientist wants to run
all kinds of torturous experiments. Do you want him to lock up the
original, or the copy?"

I said, "It doesn't matter. I have no preference. They are both me."

This seemed to startle everyone. Most people say that they would
prefer that the copy be tortured, but they are unable to justify this.
It is generally seen as a puzzle. I see no puzzle.

Think about a computer. You don't really care about the machine; you
care about the programs and data on the computer. If you copy all of
the data to a new machine, then nothing has changed. You now have two
identical computers. If one of them got destroyed, you would not
really care.

Yet the people all seemed to think that identity was somehow connected
to their physical body. So I proposed a modification to the plan. I
said, "Imagine that the copy of you is flawless, but that the original
is damaged in the process. Your ability to do everything you consider
important in life, from making money to doing research to loving your
family. You are, literally, half the person you once were. Now, do
you want the original or the copy to be the lab rat?"

The philosophy teacher thought about this for a while, and said, "My
work is important. I think I would take one for the team and let the
copy take my place in the world."

He still didn't get it. It seems self-evident to me that the copy
would gain all rights to his identity. The copy is now more like him
than the original. By any sensible definition of identity, he should
think of the copy as 'me' and the original as 'other.'

But if you don't work with computers and data transfers much, you
wouldn't have the insight that I do into data and identity. It seems
perfectly natural to me to define people in terms of data rather than
a physical body.

Wednesday, October 29, 2008

Class and Car Purchase

What does your vehicle say about your social class?

Lower Lower Class: You have no car.
Middle Lower Class: You acquire an old clunker for free and fix it up yourself.
Upper Lower Class: You acquire a sensible economy car for cheap and
fix it up yourself.

Lower Middle Class: You take out a loan to buy an old clunker.
Middle Middle Class: You take out a loan to buy a sensible economy car.
Upper Middle Class: You take out a loan to buy a fancy, conspicuous car.

Lower Upper Class: You buy a sensible economy car by writing a check.
Middle Upper Class: You buy a fancy, conspicuous car by writing a check.
Upper Upper class: You have people to buy cars for you and drive you around.

Tuesday, October 28, 2008

Imaginary Education

A main part of my job as a TA involves working directly with the
results of our country's education system. This has been extremely
informative.

One guy who came in for tutoring was incapable of dividing 800 by 400
in his head. He had come in to my office for help with a problem, and
our problems are usually designed so that you can do it without the
aid of a calculator. That's the theory, anyway. The problem required
finding the percentage change of something, which meant doing the
aforementioned calculation. I was guiding him through the problem,
and when we got to that part, he said, "I can't do it; I don't have my
calculator with me." I said, "You've got scrap paper; do it by hand."
The words did not seem to register. He looked at me like I had asked
him to calculate a cube root by hand.

Now, this guy admits that he is not good at math. But he got acecpted
to a big-name university, one of the top 30 in the nation. This year,
we accepted about 3,000 incoming freshmen out of over 15,000 freshman
applications. Half of the incoming freshmen were in the top 10
percent of their high school graduating class, and they have an
average SAT of 1226.

My aunt is an elementary school teacher with a couple of master's
degrees in education. I asked her at what grade students would be
expected to divide 800 by 400. Her answer: second grade.

So we have a guy who got into a high-quality, selective university,
and he can't do second-grade math reliably. I'll give him the benefit
of the doubt; maybe he could have done it if he really had to. But
this learned helplessness, this dependence on machines to do math, is
endemic among the freshmen I am teaching.

I toyed with the idea of giving a five-minute math quiz in class one
day. I'd hand out a paper with 100 simple arithmetic problems, give
them five minutes, prohibit calculators, and see what the results are.
When I mentioned this to my aunt, she pointed me to some websites
that have math testing materials for elementary school tachers. None
of the tests fit what I wanted to do, but I say something that
literally stunned me: a test on imaginary numbers meant to be given to
fifth graders. My aunt confirmed that the standardized tests do
indeed include imaginary numbers.

This is ridiculous. Nobody except mathematicians and electrical
engineers, and maybe computer programmers, needs to know anything
about imaginary numbers. I was first introduced to imaginary numbers
in an elective class in my senior year of high school, at a
math-oriented magnet school. I am studying a math-intensive research
field, and I will never, in my professional career, ever use imaginary
numbers. There is no possible justification for trying to test
elementary school students on this stuff.

Clearly this is a symptom that the people who make these tests are
losing contact with reality. What were they thinking? Maybe it was
along the lines of "Advanced mathematicians use this stuff, and it is
technically possible to make the kids memorize it, so if we teach it
we are teaching high-quality math." This is of course rubbish.
Making kids memorize the rules for manipulating complex numbers does
nothing to teach the fundamental concepts. The brains of little kids
are simply not equipped to grasp the concept of 'The square root of
negative 1'. I can barely understand the meaning of the concept. I
would be pleasantly surprised if a fifth grader even understood the
concept of the square root, and knew how to use it.

Is it any wonder that kids ignore or forget basic math lessons? If
the imaginary numbers are any indication, they have been subjected to
cargo-cult math lessons their entire life. They may be able to
memorize a routine and pass a test, but the system has clearly put
very little effort into teaching them how to actually use math. Math
is a set of tools that you use to understand reality. If you don't
understand that, then you will always be hopeless at it. If you don't
know how to connect math to reality, than the math is useless.

I have opten complained about how algebra is a requirement for getting
a high school diploma, even as there is almost no effort to teach
basic financial literacy. I would guess that only about 10% of the
people on the planet actually need to use algebra in their jobs. But
everyone needs to know about interest rates, compounding, and the time
value of money. And if you don't take business courses in college,
you will never learn about these kinds of things. One of the main
reasons for the economic mess we are in now is that people simply do
not understand what it means to borrow a lot of money.

Now, algebra does help you work with the interest rate equations. If
you don't have algebra skills, you have to learn half a dozen formulas
instead of just one or two. But people are much better at
memorization than symbolic manipulation. Most people simply do not
possss the kind of mind that is required to be comfortable with
algebra, and it is foolish to expect them to learn this esoteric skill
at the expense of things that you need to know to live a good life.

Teaching imaginary numbers in elementary school is far, far worse than
teaching algebra in high school. Instead of something that 10% of the
population needs, it is something that 0.01% of the population needs.
It is also worse than useless. The kids, if they have any sense, will
forget everything they ever learned about imaginary numbers right
after they take the test. This creates horrible habits. Not only do
they learn to forget the useless routine of the week, they also learn
to forget the basic life skills that they will really need.

I have seen more and more evidence that our education system is
completely failing to provide students with a useful, science-based
mapping of reality. Instead, it all seems to be devoted to putting
random facts and arbitrary routines into short-term memory. Now,
memorizing facts is important. Facts are the bricks that you use to
build the structures in your mind. But you need something to connect
that knowledge to, so it becomes long-term knowledge. Facts without
context are soon forgotten.

Education should be about teaching people how to understand and work
with reality. I have seen little evidence that our system
accomplishes this.

Thursday, October 23, 2008

Cultural Superiority

From BBC News:

"The body of a 20-year-old Iraqi girl turned up recently in a small
Sunni town south of Tikrit. Her own family had killed her.

She had been having an affair with her cousin, but that was not the
problem: cousins often marry in this part of the world. But they had
decided to have sex and he had persuaded her to let him film this
"just for us".

Of course, he could not resist showing the tape to his friends, to boast.

The pictures started to circulate in this small town and her family
found out the couple had been sleeping together.

Honour demanded that they murder her - not him, naturally.

The US army officer telling me this story said his soldiers had wanted
to find the boy involved and give him a good beating.

The officer, too, was furious, but also resigned to the situation.
After more than a year here, he knew only too well that Salahaddin
province was never going to be Kansas. "

http://news.bbc.co.uk/2/hi/middle_east/7684866.stm

---

Some cultures are better than others. This is a simple fact. By any
standard of value you care to name, a civilization that organizes
itself by Enlightenment values* is superior to a civilization that
organizes itself by primitive tribal superstitions and taboos. It has
been hundreds of years since this kind of thing happened with any
regularity in Western society.

Clearly, there are a lot of things we still need to improve. We are
still dealing with the effects of a history of brutality, repression,
and toxic social structures. But at least it is mostly history. In
America, this kind of savagery is a tragedy. In most of the rest of
the world, it is a statistic.

I know that, in many cases, the USA is not the best exemplar of
Enlightenment values. And there are many social issues, like the
liberty/equality trade-off, where there is no unequivocably superior
state of existence. I would estimate that America is the fifth or
sixth best country on the planet, in terms of culture. There are a
few places that are a little better, about dozen that are about equal,
and a couple dozen that are almost as good. Most of the rest are
cesspools of violence, corruption, and rotten habits of thought.

This does not imply that the people who live in those cultures are
inherently worse than us. People are people, all driven by the same
basic psychology. There is no racial difference in overall mental
ability or tendency toward violence. But people are all very
malleable. They soak up the culture they are born into. People who
are born into bad cultures will usually become bad, and the only way
to fix that is to change the culture.

This has been done. Before 1945, Japan was a fascist, militarist,
god-emperor-worshiping theocracy that sent its young men on suicide
bombing missions. We changed that by breaking the existing power
structure and imposing liberal democracy by force. It was the biggest
social experiment ever attempted, and it worked.

Of course, the situation in Japan was much more friendly to outside
change. The culture and power structures were very centralized, while
Iraq has a horribly complicated web of small-scale, local, tribal
power structures. But the fact that we have been unwilling and unable
to change the culture in Iraq for the better can be seen as a symptom
of the decline of our civilization.

Most of the mess in Iraq is the failure to commit sufficient resources
to the job. War is hell. It should only be undertaken in order to
avoid an even worse hell. If you do go to war, you must go in with
excellent strategy and overwhelming force, so as to end it as quickly
as possible. A half-assed war is the worst possible option, because
it generates all of the problems of war, and it costs more in the long
run, and it fails to change the world in your favor.

But the bigger problem is that Americans have lost confidence in the
values of our civilization, forgotten what they are, or, even worse,
actively opposed them**. In the late 1940's, nobody had any
complaints about forcing Japan to accept a constitution that was
mostly a copy of ours. It was seen as the natural and inevitable
thing to do. Partly this was due to racism and egotism, but there was
also the justified belief that our way of organizing society was
better for all of the people in society. We should recover this
belief, and celebrate it.

A lot of people might read this post and think of me as a bigot. It
is true that a vast number of bigoted people in our history have
talked like this, and that a sense of superiority is a very dangerous
thing. But if you have something valuable, you should treasure it.
Our culture is a rare and valuable thing. I am not a superior human
being because I was born into our culture. I am just lucky. And I
want every human being in the future to share my good fortune.

*Reason, the scientific method, rule of law, respect for life and
liberty, legal protection of individual rights and freedoms

**There was once a time when being a liberal meant that you were
trying to make society better. Now, it seems like being a liberal
means saying that no society is better than any other. There are far
too many people who exaggerate the problems in our society while
ignoring the far worse problems elsewhere.

Wednesday, October 22, 2008

Random Notes and Quotes

These things have been accumulating on my note paper. They are not
worth writing a full blog post on, so I'll put them all up now so I
can clear the clutter off my desk:

---

Office Conversation:
"It must be really bad to not have a sense of humor. How do they cope?"
"A feeling of superiority is a substitute for humor."

The best way to beat the odds is to make yourself better than average.

It takes a dirty mind to sound innocent all of the time. People who
really are innocent often say dirty things because they do not know
the double meanings. You have to know all of the innuendo and slang
in order to avoid saying them.

On average, people who are wrong use stronger language than people who
are right. This is because the kind of people who know the truth are
usually the kind of people who are careful with their language. This
means that people who judge opinions by 'strength of conviction'
usually believe the wrong people and things.

Supporting a few 'unfit' individuals is a small price to pay for
maintaining the long-term genetic diversity of the human race.

Too many simplifying assumptions makes a theory worthless. Too few
simplifying assumptions makes a theory impossible to work with.

A patient evil person is easily mistaken for a good person. An
impatient good person can easily cause a lot of evil.

The interest rate is the reward for patience or the punishment for impatience.

Economics is the study of what happens when people make rational
choices. It has much less predictive value in situations when people
are unwilling or unable to act rationally.

Math proofs say nothing about reality. They are only show the
self-consistency of a language system.

Beware of anybody who judges reality against an imaginary perfect world.

An economist understands people the same way a bridge builder understands cars.

I looked for economist jokes online, and found very few original ones.
Almost all of them were recycled lawyer jokes or scientist jokes.
That, in itself, is an interesting result: An economist is someone
about whom you can tell both layer jokes and scientist jokes.

For a certain definition of rationality, animal behavior is always
more rational than human behavior. There is more selection pressure,
and less room for error.

You will never make money if you assume that everyone else is rational.

"Politicians always talk about 'a level playing field.' They have
never seen a level playing field. You don't want a level playing
field; the water never drains off." - My Micro Professor

Macroeconomic growth models are based on the assumption that people
maximize their happiness. This is fundamentally flawed because it
does not have an evolutionary perspective. Assuming that behavior is
passed onto children, the only behavior we will see in the long run is
behavior that maximizes the number of successful children. Behavior
patterns that focus on anything other than children will quickly
disappear from the population.

Intelligence is what you know. Wisdom is your ability to define the
limits of your knowledge.

---

Whew. Unfortunately, that did nothing to clear my desk. Each sheet
of notes had exactly one topic that deserves to be expanded into a
full blog post...

Monday, October 20, 2008

Collectivism and Causality

I hate collectivism. I hate almost everything about the mindset that
would sacrifice individual initiative and liberty for the sake of some
group. I believe quite strongly that individuals should make their
own choices and shape their own lives.

But I also hate hero-worship and scapegoating. Rather than finding
one person to praise or blame for any event, I prefer to look for
scientific, technical, institutional, or systemic causes. I believe
that most events and situations are not the direct result of human
intention, but are instead caused by the chaotic combination of a lot
of different, and often random, events.*

How can this be reconciled? It would seem that one part of my mind is
embracing collective causality and responsibility even as another part
rejects it. But I believe that my two beliefs are a sensible, and
indeed inevitable, combination.

First, there is an important distinction to be made between the source
of value and the explanation of events. Collectivists believe that
the group is the source of value; I believe that any group is simply a
sum of individuals and that individuals are the true source of value.
This is completely compatible with a belief that the events in the
world are caused by the sum of actions of millions of individuals, and
not merely the will of one person or a small group.

It is also important to note that hero-worship and scapegoating are
not actually about the individuals. They are about the needs of the
group. People who blindly follow charismatic leaders are not judging
the leader's merits as a human being. They are seeing the leader as a
symbol, an avatar of their collective needs and desires. Similarly,
people who condemn scapegoats are rarely judging the scapegoat as a
human being. Rather, the scapegoat is seen as a symbol, a
manifestation of something that is wrong with the world.

I believe that there is actually a correlation between the
collectivist mindset and hero-worship and scapegoating, and that these
two behaviors both arise from the same psychological fallacy: The
belief that people can impose their will and intentions directly onto
reality.

It is a nearly universal superstition that things in the world are all
caused by conscious design. Primitive people believe that the wind
blows or the rain falls because some sentient power willed the event
to happen. This belief has been mostly discredited. But it has been
a lot harder to discredit the belief that social and economic events
are caused by direct intention. Economists study economic events the
same way that physicists study atmospheric events. We know that there
are certain laws that govern the behavior of the system. An
individual, even a politically powerful one, has about as much chance
of changing the economy as he or she does of changing the weather.**

And yet, people continue to believe that economic and social events
are all the result of somebody's intention. They assume that bad
events are the result of evil intentions, and that good events are the
result of good intentions. They believe that it is possible to
magically transform an intention into an economic or social reality.
Usually, they also believe that the government is the tool for doing
this. This leads to the conclusion that you can fix the world by
agreeing on common goals, and then putting someone with the right
intentions into a position of power in order to make those common
goals a reality.

Of course, the world is a lot more complicated than that. Things
happen for a lot of different reasons, and people in power soon find
that their ability to change the world is limited by, among other
things, the basic laws of economics and the basic facts of human
behavior. Things happen that nobody ever intended, and the more you
apply power in an ignorant way, the more likely you are to cause
seriously bad unintended consequences.

My belief in the limited power and capabilities of individuals
actually strengthens my belief in individual liberty. I may have a
small ability to control the circumstances of my life, but everybody
else has an even smaller ability. Life is extremely unpredictable and
chaotic, but this means that decisions must be made quickly and on the
spot. Individuals have more ability to manage their own lives than
any outside agency. The ability of the people in a government agency
is even more limited than the ability of people living their own
lives.

So what should we do? We need to learn how the world works. We need
to study how laws, rules, institutions, habits, psychological quirks,
history, and society combine to generate the effects we see in the
world. And then we need to use that knowledge to make sure that
government does the job it was meant to do: provide a legal and social
framework that allows individuals to live the best lives they can.

PS: I was going to include some discussion about how moral judgments
are shaped by beliefs about intentions and effects, but that will have
to wait for a later date. In the meantime, give this question some
thought: Do you base your moral judgments on the intentions behind a
person's actions, or the effects of those actions? This is a question
that gets more challenging as you think about it more.

*For example, many people think that gas is expensive because the oil
companies decided to make it expansive. Economists know that this
belief is nonsense. Gas prices are the result of market forces, the
combination of supply and demand, which comes from the collective
decisions of millions of people.

**Individuals can change the weather, if they work hard enough. You
can seed the clouds to make it rain, and a factory can easily cause a
nasty smog. But in the end, natural forces determine the overall
pattern. The same thing is true of meddling in the economy.

Friday, October 17, 2008

Hedge Fund Chat

Earlier today, the manager of a hedge fund talked to our economic department.

He talked about how crazy things were, and how the businesses were
being wiped out by lack of credit. You have to be able to borrow
money to make investments, and when you cannot borrow, it is
impossible to do anything. Even if you have an almost-guaranteed
profit from investing in a business, you cannot do it. Banks are
forcing them to repay their loans immediately, which means that they
have to keep selling all of their assets to stay solvent. This drives
prices down, and makes the whole cycle worse. Even I knew most of
this already, but it was good to hear an insider's perspective.

Hedge funds have special contracts; investors are only alloweed to
withdraw money on certain dates. And when investors start to pull
out, they will go bankrupt and/or be forced to sell off all of their
assets. The big date to watch out for is November 15; he predicted
that a large percentage of the hedge fund industry, including his own
company, will disappear that day or shortly after. That will cause
bad things to happen in all kinds of financial markets.

He also mentioned the gallows humor that sets in on a Friday afternoon
after losing money all week. The joke going around the banking
industry is that "The last two weeks have killed more Jews than
Hamas."

After the meeting, he went to meet the dean of the college about
something. We speculated that he was asking for a job.

Thursday, October 16, 2008

Turing Test

Recently, a computer almost passed the Turing Test. It managed to talk to people via text chat, and convince almost 30% of the examiners that it was a human.

Personally, I think the Turing Test is hogwash, for two reasons:

1) It is not a test of artificial intelligence, it is a test of computer programmers' ability to write a program that succeeds at a narrowly defined task.

2) If you took a random sample of people and told them to play with Ouija boards, I would not be surprised if 30% of them thought they were communicating with a sentient entity.

I will not be impressed until a computer manages to successfully administer a Turing Test. Sentience is, among other things*,the ability to make judgments about the sentience of other entities.**

*Sentience is also the ability to be comfortable with self-referential paradoxes.

**Yes, I am aware this statement, when combined with Reason 2, implies that people who use Ouija boards seriously are not sentient.

Monday, October 13, 2008

Scripture Conference

The pastor at my church knows how to take advantage of being near a
college campus.

Today I got an email basically saying "Our normal Monday night bible
study is canceled. Instead, we will be going to a discussion being
held by the University's philosophy department. They have a Jewish
professor, an Eastern Orthodox priest, a Catholic Priest, and a
Lutheran pastor doing a round-table conference on authority and
interpretation of scripture."

I decided to skip karate and go with them. I'm glad I did; It was a
good event. The four panelists gave introductions, then opened the
floor for questions. There were a lot of people there. Some of the
random students would ask ignorant questions like "How do Jews believe
they get saved?"* and then our pastor, or one of his pastor friends,
would ask an insightful question about something like the description
of canon or the fundamental source of scriptural authority.

Memorable quote: "When you look at the epistles of Paul, you are
really reading somebody else's mail."

*Most Jews do not believe in any kind of afterlife or salvation.
There is no mention of heaven or hell in the Old Testament. The
religion is all about your actions and character in this world,
studying and following the Law of God in order to life a proper life.

Information Flows

Our football team has had a fairly disappointing year. Rightly
or wrongly, people blame the head coach and have been calling for his
dismissal. They have been complaining about how much he was paid, and
that he had a long-term contract.

At the end of the big economics class, right after the professor
dismissed the class, some guy stood up and announced "Bowden got
fired!" About half the class started cheering. The professor did not
seem to mind.*

As I was walking back to my office, I noticed a greater than usual
amount of people talking on mobile phones, and overheard at least two
comments about the dismissal. One of them was about how the
university had to pay to buy out his contract. I estimate that
everyone on campus who cared about football knew the fact within the
hour of its announcement. Out of curiosity, I checked Wikipedia
shortly after I got back to my office. It had already been updated.

I decided to get in on the action. The homework assignment that I
give out tomorrow will include the following problem:

Problems 18-20 use the following information. You are a football
coach. You are currently working at C--- University, and you have
a contract promising you $2 million per year for the next three years.
You are paid a lump sum at the beginning of the year. (The first
year's salary is not discounted). The interest rate is 10%. You know
that you could get a job at another school that paid $1 million a year
for the next three years, in lump sums at the beginning of each year.
18. What is the net present value of your C--- contract?


19. What is your opportunity cost of working at C---?


20. If C--- decides to buy out your contract and dismiss you, how
much must they pay you?


* Texting on cell phones and messaging in laptops are endemic in the
class. The professor makes no attempt to stop it, as long as it does
not disrupt other people. But if your cell phone rings, he will make
you stand up and apologize to the class.

Friday, October 10, 2008

Artist Reception

They have a new sculpture display in the campus gallery.

The center of the display is a wooden boat, painted white, hanging
from the ceiling. There are hundreds of mechanical birds clinging to
the sides and bottom of the boat. When the viewer turns the sculpture
on, the birds all start pecking on the boat for a couple minutes.

It sounds silly, but it is an effective and mesmerizing piece of art.
And the more you see it, the better it gets. Each time you activate
it, the pattern of pecking is randomized, so the experience is unique.

Yesterday the artist was giving a presentation on his work and this
piece. People were asking him about the art:

Guy: "How many birds are there?"
Artist: "279"
Gut: "Is there any significance to that number?"
Artist: "Yes, I chose that number for a very specific reason." He
paused, looked at the boat, and continued, "This looks right."

Later, he was talking about how he randomized the birds:

"I have a computer running in there with a random number generator.
But the thing about random number generators is that they are not
completely random. Sometimes the same sequence can repeat itself. I
didn't like that, so I added analog circuits between the computer
output and the birds. There are capacitors and resistors to modify
the signals sent to to the motors in the birds. And if you use really
cheap capacitors and really cheap resistors, their performance is
unpredictable. So that gave me the true randomness I was looking for;
each activation is guaranteed to be completely unique."

I got a chance to chat with the artist for a while. He asked what I
was studying; being an economist at an art gallery is usually a good
conversation starter. Here is one random snippet from the
conversation:

Artist: "I always thought economics was just random and chaotic, but
then I saw a movie about some guy who was always seeing patterns in
everything, what was his name?"
Me: "John Nash"*

The artist was a clever guy; anyone who knows about electrical
engineering knows that getting analog circuits to do what you want is
always a tricky task. But he always seemed to say that he wasn't very
smart, or that the best things in his art were just random accidents.

It was a good conversation. I usually enjoy talking to artists. Most
of them have a good understanding of how complicated the world is and
how limited our knowledge often is. They are interested in new ideas,
open to new knowledge, and are relatively free of the dogmatic
intellectual arrogance that you often find in academics.

*I have not seen 'A Beautiful Mind', but I know its effect on popular
and artistic culture. It seems to be the source of the few accurate
things that artsy types know about economics. One of these days I
will have to watch it, so I can talk about it.

Thursday, October 9, 2008

Cholesterol

This article on cholesterol is recommended by a biologist. It is a good read:

http://www.marksdailyapple.com/cholesterol/

The overall conclusion of the article matches one of my personal mottoes:

Think like an angel.
Eat like an ape.

Future Shock

Sometimes the future sneaks up behind you and pokes you in the back.

I just read that they have a working, operational computer network
protected by quantum cryptography:

http://news.bbc.co.uk/2/hi/science/nature/7661311.stm

I knew the theory of quantum cryptography, but as far as I knew it was
just theoretical, the kind of thing that might happen in ten or twenty
years.

There are a lot of things that, as far as I know, are ten years in the
future. But now that I stop to think of it, most of my in-depth
technical and engineering knowledge was obtained between ten and four
years ago. So over the next few years, there will be an increasing
number of things that show up in reality that my mind had placed
firmly in the category of 'future'.

I think that future shock is worse for people like me with some
technical knowledge. If you didn't know about quantum cryptography,
your reaction to this news would range from 'Who cares?' to 'Hey look,
the smart guys came up with another clever thing.' But if you had
read about the topic years ago, you would have some idea of how much
work and effort and knowledge went into it, and how incredible it is
that we have it.

Things seem a lot more amazing when you are accustomed to reading
about them in the future tense.

Tuesday, October 7, 2008

Teaching

I have tutored in various subjects before, and given presentations in
various topics, but this is the first time in my life that I have
taught a class over a period of time. It is defintiely a learning
experience.

Actually, I am not teaching the full class. Twice a week, a professor
gives a lecture in a lecture hall to about 300 students. Once a week,
the teaching assistants meet sections of about 20 students. Our job
is to answer questions, do some additional lecturing, and give quizzes
and homework.

Most of the class is freshmen. This class is specifically designed to
train and test critical thinking skills. For most of the class, this
is a completely new experience. They have all excelled in high school
via some combination of rote memorization and raw intelligence. This
class requires a completely new way of operating, and it is a little
traumatic for many of them.

For example, the ideal test taking strategy all through high school is
as follows: Read the question, then read the answers, then choose the
answer that most closely resembles something written down in your
textbook or lecture notes. This strategy specifically coached in some
places.

In this econ class, that simply will not work. The tests are
specifically designed to trick people using such a strategy. Many
questions are exact copies of a statement in the textbook, but with
one key word changed to reverse the meaning. Other questions require
some kind of multi-step problem solving, and the answers are often
formatted like:
A: statement
B: statement
C: statement
D: Both A and B
E: All of the above

So you have to make a decision about the correctness of every statement.

I have told the students that their test taking strategy should
change. I recommend that they cover over the answers, not even
looking at them, and then see what facts they can deduce from the
information presented in the problem. This usually involves drawing a
picture and/or doing some math. Then, only after they have an idea of
what is true and known, they should look at the answers and decide
what is right.

They are still at the point in their academic careers where the best
way to teach them how to do something is to have them memorize a
sequence of operations. This usually works, but in order to really do
well on the tests, you really have to master the material. Usually I
have no hope of teaching this.

One student, however, is a third-year engineering major. A recent
conversation went something like this:

Him: "I don't really understand this elasticity of demand stuff. I
know how to calculate it, but I don't really see how it connects to
the graph.
Me: "The elasticity is the reciprocal of the slope of the demand curve
graphed in log-log space."
Him: "Okay, thanks. It makes sense now."

Obviously, most students would never understand that statement at all,
and I would never use class time to attempt to explain it. But I was
able to connect to his math knowledge to explain something.

This is an example of how I can usually do a good job of tutoring
people individually. However, my lectures are no better than average,
and I need to figure out how to improve them. I guess it is a matter
of experience. But the ideal use of class time for me seems to be to
give lots of practice tests in order to convince them to study on
their own, pay more attention during the professor's lectures. and/or
come talk to me individually.

Friday, October 3, 2008

End of Ramadan

On Thursday I was invited to an event run by the Muslim student
association to celebrate the end of Ramadan. It consisted of the
traditional feast, and a speech by a local imam talking about the
basics of the religion. The person who invited me was a Libyan
exchange student in the Econ department.

I got into a discussion with a mechanical engineering student from
Jordan. Actually, he and his family were originally from Palestine.
He originally went to some university in Ohio, but then moved to
our university, which he likes a lot better. Being in the worst part of
Cleveland is not a fun experience for anybody, especially a foreign
student. People he knew were robbed, and he saw someone who had been
knifed by a panhandler. Here, by contrast, is a utopia filled with
nothing but friendly, helpful people.

Yet, oddly enough, He said that before he came here, he had 'the wrong
idea' of the USA from movies. He thought America would be a 'bad,
dangerous' place. He did not say that Cleveland fit his expectations;
apparently his fears were even worse then the reality he experienced
there.

I asked him about the Wahhabi sect*. Here is exactly what he said:

"They are very strict. They don't think."

Later, he said something like:

"There are a lot of people who use the religion to try to cover up the
problems in their lives. Instead of looking in their hearts, they
find an excuse to blame other people."

He said that the Wahhabi muftis are becoming less and less popular as
people realize how out-of-touch they are. Maybe he was just trying to
say what I wanted to hear, but it seemed like he really did view them
as ignorant hicks.

Related note: One of the presenters at the education conference a few
weeks ago mentioned that most terrorists do not come from the
madrassas (religion schools) They come from state universities. He
said that it was not the result he wanted to find, but the data show
having more knowledge of Islam makes one less likely to be a
terrorist.

* The branch that supports jihad, Al-Qaeda, and other terrorists.

Thursday, October 2, 2008

Hopelessly Adult

I finally had some free time recently, after a long stretch of being
very busy. What did I do with my time? What was it that I wanted to
do with my evening, more than anything else?

I gave my apartment a really good cleaning.

Wednesday, October 1, 2008

Fractional Children

One fourth of our macroeconomics midterm was a question about the
number of children a household would choose to have. It gave some
mathematical functions describing budgets and preferences, and asked
us to derive a model.

I got a very low score on this question. I went to ask the professor
about it, and the conversation went something like this:

Prof: "You were supposed to model the number of children as a
continuous variable."
Me: "But that wouldn't make any sense. This question was about an
individual decision, not a societal average, and kids only come in
integer quantities."
Prof: "We always work with continuous variables on these kinds of problems."
Me: "I had no way of knowing that. Was there anything wrong with my
math, given the assumption that you can't have a fraction of a kid?"
Prof: "Your math looks fine. But I'm not giving you any credit for
it. I've given a question like this to hundreds of students like
this, and you are the only one to assume that the number of children
has to be discrete."

I don't know what is worse, the professor's attitude, or the fact that
I am the only student who ever stopped to consider that you can't
choose to have a fraction of a child.