This week, The New York Times launched Upshot , described as “a plainspoken guide to the news” and in essence, similar to two other explanatory new sites that have recently launched (Vox.com and FiveThirtyEight.com). My favorite piece so far on Upshot is Justin Wolfers’s “What Good Marathons and Bad Investments Have in Common” (because it combines two of my interests: finance and running):
In the usual analysis, economists suggest it’s worth putting in effort as long as the marginal benefit from doing so exceeds the corresponding marginal cost of that effort. The fact that so many people think it worth the effort to run a 2:59 or 3:59 marathon rather than a 3:01 or 4:01 suggests that achieving goals brings a psychological benefit, and that missing them yields the costly sting of failure.
But in other domains, this discontinuity between meeting a goal and being forced to confront a loss can lead to bad economic decisions. Because losses are psychologically painful, we sometimes strain too hard to avoid them.
For instance, when you sell your house, your goal may be to get at least what you paid for it. But this simple goal has led to disastrous decisions for those who bought homes in Florida or Nevada during the housing bubble. Too many homeowners set their selling prices with an eye on recouping past investments rather than on current market conditions, and as a result, their homes didn’t sell, deepening their financial distress.
Well worth the read in entirety.
Despite having a population of about 318 million people, 47 percent of the USA remains unoccupied.
A Block is the smallest area unit used by the U.S. Census Bureau for tabulating statistics. As of the 2010 census, the United States consists of 11,078,300 Census Blocks. Of them, 4,871,270 blocks totaling 4.61 million square kilometers were reported to have no population living inside them.
This map, with areas shaded in green, shows where there is zero population in the United States:
Very curious is how you can distinctly see the border boundary of North Dakota (it is more apparent than the boundary of any other state). Why? Mapsbynik provides a clue:
On a more detailed examination of those two states [North Dakota, South Dakota], I’m convinced the contrast here is due to differences in the sizes of the blocks. North Dakota’s blocks are more consistently small (StDev of 3.3) while South Dakota’s are more varied (StDev of 9.28). West of the Missouri River, South Dakota’s blocks are substantially larger than those in ND, so a single inhabitant can appear to take up more space. Between the states, this provides a good lesson in how changing the size and shape of a geographic unit can alter perceptions of the landscape.
Joe Nocera, writing in The New York Times, summarizes Lawrence Goldstone’s new book, Birdmen: The Wright Brothers, Glenn Curtiss, and the Battle to Control the Skies. The narrative about the extent of the patent fight between the Wright brothers and Glenn Curtiss, another entrepreneur, was extensive (and something I had no idea about):
The Wright brothers’ critical insight was the importance of “lateral stability” — that is, wingtip-to-wingtip stability — to flight. And their great innovation was something they called “wing warping,” in which they used a series of pulleys that caused the wingtips on one side of the airplane to go up when the wingtips on the other side were pulled down. That allowed the Wrights’ airplane to make banked turns and to correct itself when it flew into a gust of wind.
But when the Wrights applied for a patent, they didn’t seek one that just covered wing warping; their patent covered any means to achieve lateral stability. There is no question what the Wrights sought: nothing less than a monopoly on the airplane business — every airplane ever manufactured, they believed, owed them a royalty. As Wilbur Wright, who was both the more domineering and the more inventive of the two brothers, put it in a letter: “It is our view that morally the world owes its almost universal system of lateral control entirely to us. It is also our opinion that legally it owes it to us.”
So, a brief note on the patent system by the author:
Without patent protection, a competitor can simply replicate an invention and undercut the inventor’s price — which necessarily includes all the time and expense of research and development — so the incentive to experiment and create is severely inhibited. But if innovators such as Glenn Curtiss cannot build on the progress of others without paying exorbitantly for the privilege, the incentive to continue to experiment and create is similarly inhibited.
Insightful take from Kevin Kelly on the valuation of time vs. money:
When you are older, you tend to have more money than time. If you have only two week vacation, you need to rush things so you can keep your job. You’ll pay to fly in to the hotspot rather than spend your two weeks in the back of the bus getting there. You’ll pay extra for the express train because it will save you a day — and its clean bathrooms will delight your 12-year-old daughter. Maybe you hire a guide to take you directly to the festival instead of wasting an afternoon wandering around. With money you can eat whatever you desire.
Here is what I learned from 40 years of traveling: Of the two modes, it is far better to have more time than money.
Time is the one thing you can give yourself in abundance. It is often the one resource the young own…
This is a creepy piece in GQ Magazine on Valeria Lukyanova, who looks like a real-life Barbie. Here’s a photo of her:
The future Barbie was born nowhere near Malibu. Valeria hails from Tiraspol, a gloomy city in Europe’s poorest country, Moldova. Valeria remembers both her Siberian-born grandfather and her father as very strict and began to rebel at the usual age of 13. Stage one involved dyeing her hair, which is naturally a low-key shade of brown. Valeria went for the goth look first—about the farthest you could get from Barbie. She wore all-black clothes to accentuate her very white skin. Kids at school began to tease her.Look, a witch! At 15, traumatized by the name-calling, she doubled down: bracelets with sharp two-inch spikes, artificial fangs. She was dismissed from a school choir for standing bolt upright when the singers were instructed to sway; in different circumstances, this budding nonconformism could have brought her straight into Pussy Riot.
Instead, she began modeling, small-time stuff, and learned to apply makeup and hair dye in increasingly theatrical ways. Valeria was less interested in attracting men than in repelling them: “A dude would try to talk to me on the street and I’d be like—” she switches to a raspy basso—” ‘Oh, honey, aren’t I glad I had that operation.’ ” Another time, a guy tried grabbing her by the hand and she semi-accidentally cut him with her bracelet spike.
Proceed to read the whole thing with caution.
“Admissions directors at these institutions say that most of the students they turn down are such strong candidates that many are indistinguishable from those who get in.”
That’s from this New York Times piece, which cites that Stanford accepted an ultra-low 5% of candidates this year.
Part of the reason for such low admission rates? It’s way too easy to apply to multiple colleges with the common application, compared to the way it was less than a decade ago:
At the same time, students send more applications than they once did, abetted by the electronic forms that have become nearly universal, and uniform applications that can make adding one more college to the list just a matter of a mouse click. Seven years ago, 315 colleges and universities accepted the most widely used form, the Common Application; this year, 517 did.
Charles Stross has a smart post titled “A Nation of Slaves” on how he differentiates a good job vs. a bad job:
There are two tests I’d apply to any job when deciding whether it’s what sociologist David Graeber terms a Bullshit Job.
Test (a): Is it good for you (the worker)?
Test (b): Is it good for other people?
A job can pass (a) but not (b) — for example a con man may enjoy milking the wallets of his victims, but their opinion of his work is going to be much less charitable. And a job can pass (b) but not (a) if it’s extremely stressful to the worker, but helps others—a medic in a busy emergency room, for example.
The best jobs pass both (a) and (b). I’m privileged. I have a “job” that used to be my hobby, many years ago, and if Scrooge McDuck left me £100M in his legacy (thereby taking care of my physical needs for the foreseeable future) I would simply re-arrange my life to allow me to carry on writing fiction. (I might change the rate of my output, or the content, due to no longer being under pressure to be commercially popular in order to earn a living—I could afford to take greater risks—but the core activity would continue.)
On the other hand, many of us are trapped in jobs that pass neither test (a) nor test (b). If Scrooge McDuck left you £100M, would you stay in your job? If the answer is “yes”, you’re one of the few, the privileged: most people would run a mile.
This is a very interesting NPR piece on The Good Judgment Project, whereby 3,000 ordinary citizens are making incredible predictions about world events/current affairs.
In fact, Tetlock and his team have even engineered ways to significantly improve the wisdom of the crowd — all of which greatly surprised Jason Matheny, one of the people in the intelligence community who got the experiment started.
“They’ve shown that you can significantly improve the accuracy of geopolitical forecasts, compared to methods that had been the state of the art before this project started,” he said.
What’s so challenging about all of this is the idea that you can get very accurate predictions about geopolitical events without access to secret information. In addition, access to classified information doesn’t automatically and necessarily give you an edge over a smart group of average citizens doing Google searches from their kitchen tables.
The story focuses on Elaine Rich, a so-called superforecaster:
In fact, she’s so good she’s been put on a special team with other superforecasters whose predictions are reportedly 30 percent better than intelligence officers with access to actual classified information.
Rich and her teammates are that good even though all the information they use to make their predictions is available to anyone with access to the Internet.
When I asked if she goes to obscure Internet sources, she shook her head no.
“Usually I just do a Google search,” she said.
This is a very smart take from James Surowiecki on the one-hit wonder game “Candy Crush Saga,” which is propelling the maker of the gamer, King Digital Entertainment, to file for an IPO:
In its I.P.O. filing, King claims that a “unique and differentiated model” for developing games will enable it to create new hits, and plenty of analysts believe that King has cracked the code of hooking consumers. But that’s unlikely. The world of pop culture contains many more one-hit wonders than hit factories. After all, luck plays a huge role (is there really a good explanation for the hula-hoop frenzy of the fifties?), and, more fundamentally, serial innovation is just tough: studies suggest that most new products fail. In the gaming industry, success has always been highly unpredictable. Parker Brothers, according to a history of the company, found that there was no secret formula: products that tested well often flopped in the marketplace, while “an in-house flop could become the hit of the industry.” It says something that King, which has been making games for a decade, had profits of just $7.8 million in 2012. The company didn’t make eighty times more in 2013 because it had cracked a code; it just caught lightning in a bottle.
If you read King Digital Entertainment’s F-1 carefully, you’ll notice this statement:
Our top three games accounted for 94% of our gross bookings in 2013. This compares to 61% of our gross bookings in 2012. As we continue to launch new games, we anticipate that the concentration of gross bookings across our top games will decline.
Those top three games are Candy Crush Saga, Pet Rescue Saga and Farm Heroes Saga. All of those games sound like a fad, as evidenced by this statement:
Gross bookings in the quarter ended December 31, 2013 slightly declined compared to the quarter ended September 30, 2013. The decline was driven by a decrease in Candy Crush Saga gross bookings, which was mostly offset by an increase in gross bookings across all of our other games. This growth in the other games was driven by a further diversification of our portfolio in the mobile channel as we released more games on that channel in the middle and later part of 2013.
I think, as an individual investor, you’d have to be a fool to buy into this IPO. The word “decline” appears 35 times in the F-1. But you can’t blame the owners for wanting to cash out quickly.
A recent study has found that some people don’t derive much (or any) pleasure from listening to music, compared to other worldly pleasures (such as money). From the study’s abstract, describing this as specific musical anhedonia:
Music has been present in all human cultures since prehistory, although it is not associated with any apparent biological advantages (such as food, sex, etc.) or utility value (such as money). Nevertheless, music is ranked among the highest sources of pleasure, and its important role in our society and culture has led to the assumption that the ability of music to induce pleasure is universal. However, this assumption has never been empirically tested. In the present report, we identified a group of healthy individuals without depression or generalized anhedonia who showed reduced behavioral pleasure ratings and no autonomic responses to pleasurable music, despite having normal musical perception capacities. These persons showed preserved behavioral and physiological responses to monetary reward, indicating that the low sensitivity to music was not due to a global hypofunction of the reward network. These results point to the existence of specific musical anhedonia and suggest that there may be individual differences in access to the reward system.
The study focused on recruiting college students, so I am not sure if the generalizations of the study can apply to people younger or older than the sample. Perhaps our affinity toward enjoying music changes with age?
(via The Verge)