Polling location and voter choice

Somewhat in the spirit of Caplan, a new paper in Political Psychology suggests the location of polling booths may affect voter behaviour.

Voting is perceived as free and rational. Citizens make whatever choices they wish, shielded from external influences by the privacy of the voting booth. The current paper, however, suggests that a subtle source of influence—polling places themselves—can impact voting behavior. In two elections, people voting in churches were more likely to support a conservative candidate and a ban on same-sex marriage, but not the restriction of eminent domain. A field experiment found that people completing questionnaires in a chapel awarded less money (relative to people in a secular building) to insurance claimants seeking compensation for abortion pills, but not to worker’s compensation claimants.

Like a large number of Irish people, my polling centre is where I went to primary school. (Incidentally, the last time around we elected a relatively unknown school-teacher on the first count.)

(HT: BPS.)

What did abolishing university fees in Ireland do?

This is the abstract for a working paper of mine just released by the Geary Institute (& the UCD Economics School), a less technical summary is at the end.
Abstract:
University tuition fees for undergraduates were abolished in Ireland in 1996. This paper examines the effect of this reform on the socio-economic gradient (SES) to determine whether the reform was successful in achieving its objective of promoting educational equality. It finds that the reform clearly did not have that effect. It is also shown that the university/SES gradient can be explained by differential performance at second level which also explains the gap between the sexes. Students from white collar backgrounds do significantly better in their final second level exams than the children of blue-collar workers. The results are very similar to recent findings for the UK. I also find that certain demographic characteristics have large negative effects on school performance i.e. having a disabled or deceased parent. The results show that the effect of SES on school performance is generally stronger for those at the lower end of the conditional distribution of academic attainment.

http://www.ucd.ie/geary/static/publications/workingpapers/gearywp201026.pdf

Non-technical summary

1. The paper shows how the abolition of university fees in 1995/96 did not help the chances of poorer children getting into university.

2. The paper also explains why this is the case:

• There was (& still is) excess demand for places: there is a shortage of places not students.
• The fee reduction benefitted well-off students, low income ones would have been exempt.
• Most importantly: the paper shows that it’s how students do in the Leaving that matters. The fact that the low income kids do worse in the Leaving is why they are less likely to progress. Changing fees didn’t change that.

3. The paper documents precisely how students from better off backgrounds do better in the Leaving.

• If your father is a professional, count on getting about 90 points more than if your father is a manual worker.
• If your father is “other white collar” count on getting about 50 points more.
• If your father is unemployed that “costs” you about 30 points.

4. The paper also shows

• That it’s the difference in Leaving Cert performance that explains why girls are more likely to progress to university
• That if a student’s father is disabled that their points are about 50 points lower
• That if one of their parents is deceased that their points are about 40 points lower.

5. A clear policy implication of this paper is that attempts to tackle inequalities in university access that do not address these performance differences at the Leaving Certificate won’t solve the problem.

Parkinson's Law - Freakonomics meets Evelyn Waugh

"Granted that work (and especially paper work) is elastic in its demands on time,
it is manifest that there need be little or no relationship between the work to be done and
the size of the staff to which it may be assigned." This is Parkinson's Law, first expounded in an article in The Economist in 1955. In five pages C. Northcote Parkinson presents thought experiments and statistics that simply dazzle. Thnk Freakonomics written by Evelyn Waugh.

Research on Football

Fans of football research or even just of football may be interested to know that the April issue of the Journal of Economic Psychology [ vol 31, no. 2] is devoted to the economics of football. There are lots of interesting articles in it on such topics as the advantage gained by home teams, the pricing of World Cup tickets and the effect of talent disparity on team productivity.
Details of one of the papers is below:

National well-being and international sports events
Georgios Kavetsos, Stefan Szymanski

The widely proclaimed economic benefits of hosting major sporting events have received substantial criticism by academic economists and have been shown to be negligible, at best. The aim of this paper is to formally examine the existence of another potential impact: national well-being or the so-called “feelgood” factor. Using data on self-reported life satisfaction for twelve European countries we test for the impact of hosting and of national athletic success on happiness. Our data covers three different major events: the Olympic Games, the FIFA World Cup and the UEFA European Championship. We find that the “feelgood” factor associated with hosting football events is large and significant, but that the impact of national athletic success on happiness, while correctly signed, is statistically insignificant.

Mathematica Policy Research: Evaluating the US Jobs Recovery Programmes

Another useful document from Mathematica Policy Research setting down principles on how to evaluate the jobs programmes rolled out under the Recovery Act in the US

The purpose of this white paper, provided as the final deliverable product of the pre-design study, is to provide guidance to DOL as it assesses potential methodologies for evaluating each grant.

The purpose of this white paper is not to recommend a single methodological approach as the best way to evaluate these grants, and it does not make such a recommendation. Rather, it explores the advantages and disadvantages of different methodological approaches so that DOL can consider its options for proceeding with an evaluation of these grants.

Youth Unemployment

A release on a number of OECD reports issued on youth unemployment in the last few months.

TED Clip of Frankl on Youth's Search For Meaning

TED have posted a short clip of Viktor Frankl talking about meaning in 1970. Good to see TED going back looking for this type of material. How many clips and talks from the great thinkers of the 20th century must be out there doomed in TV and college archives.

Cartwright on the value of Randomised Trials

Thanks to Graham Brownlow on irisheconomy blog for pointing to this gem (requires subscription).

Nancy Cartwright, ‘What are randomised controlled trials good for? ’, Philosophical Studies, vol. 147, no.1 (2010), pp.59-70.

Abstract Randomized controlled trials (RCTs) are widely taken as the gold standard for establishing causal conclusions. Ideally conducted they ensure that the treatment ‘causes’ the outcome—in the experiment. But where else? This is the venerable question of external validity. I point out that the question comes in two importantly different forms: Is the specific causal conclusion warranted by the experiment true in a target situation? What will be the result of implementing the treatment there? This paper explains how the probabilistic theory of causality implies that RCTs can establish causal conclusions and thereby provides an account of what exactly that causal conclusion is. Clarifying the exact form of the conclusion shows just what is necessary for it to hold in a new setting and also how much more is needed to see what the actual outcome would be there were the treatment implemented.

Keywords Randomized controlled trials (RCTs) External validity
Probabilistic theory of causality Causal inference Capacities Contributions

Behavioural Economics, Business and Public Policy May 28th

Dear Colleagues,

On the 28th May, the Geary Institute will hold a major event on "Behavioural Economics, Policy and Business" in Dublin City Centre.

The currently confirmed panelists include Liam Delaney and Colm Harmon of the UCD Geary Institute, Peter Lunn of the ESRI and author of the well-known behavioural economics book Basic Instincts, and Gerard O'Neill, Director of Amarach Research. The event begins at 2pm and ends at 4pm, and will be followed by coffee. The venue is the Institute of Bankers building on North Wall Quay.

The session will begin with a short introduction to the field of behavioural economics. This short introduction will provide a working definition of behavioural economics; a short history of the field; an overview of the major global centres and projects in the area; a description of the most widely cited applications of behavioural economics ideas to real-world problems; and a brief overview of potential applications in the Irish business and policy context.

A wide ranging panel discussion will follow, addressing such questions as:

- What aspects of behavioural economics should particularly interest business people? For example, how is behavioural economics relevant to product development, advertising and marketing? What are the potential regulatory changes emerging from this literature?

- Why should policymakers care about behavioural economics? What is the relevance of behavioural economics to such questions as how we should design taxation and regulation? Is there any role for government to protect citizens from themselves in areas such as financial services?

- What has this new literature to say about economic renewal in Ireland including its relevance to major strategic initiatives such as the Smart Economy and the Strategy for Science Technology and Innovation?

We welcome suggestions for other questions to pose during the panel discussion. There will also be ample opportunity for audience participation.

In order to help us plan the event and print registration details, we would be very grateful if people could RSVP to Emma.Barron@ucd.ie at their earliest possible convenience if they intend attending the event.

Golden Circle Report

TASC have performed a social network analysis of directorships of large private companies and state bodies in Ireland. The report provides social network graphs for directors showing patterns of linkages between directors across many major state institutions and private companies from 2005 - 2007.  The network pictures are great and will be of interest to anyone with any stake in the Irish economy. However, the arguments linking concentration of directorships to corporate governance are tricky to make from the data. Much of the report argues for greater diversity on boards, something that obviously has intuitive appeal to most of us not part of the wealthy elite. But at a fast reading, it doesn't look possible to use this type of data to demonstrate a causal effect of this type of concentration on either firm or economic performance though this is from a speed read. It is worth talking about what precisely these findings imply though we are likely to have a few days where such subtleties are overlooked.

The Fabulous Fab

Freakonomics blog linked to the transcript of the famous Goldman Sachs emails released last month. Their motivation was that one of the main protagonists discusses taking a little holiday to read the Freakonomics book. The context of the emails is discussed in this Telegraph article. A quote that stands out is below (highlighted in the Telegraph article). This is from Fabrice Tourre, a senior executive in GS central to many of their dealings in mortgage based instruments. An interesting mental image if you are wondering how some of these markets work in a day-to-day sense.

“More and more leverage in the system. The whole building is about to collapse anytime now ... Only potential survivor, the fabulous Fab[rice Tourre] ... standing in the middle of all these complex, highly leveraged, exotic trades he created without necessarily understanding all of the implication of those monstruosities [sic]!!!”

Freakonomics also links to the instantaneous reaction to the plunge of P+G shares last Thursday. A strange world we are living in.

Dublin Bus offering free Pat Liddy walking tours

A considerable share of research done in the Geary Institute directly relates to Dublin. Pat Liddy has been enlisted previously to provide walking tours of specific areas of interest.


Visitors to Dublin may be interested to hear that Dublin Bus are offering a complimentary walking tour with Pat with any "Hop On, Hop Off" tour bus ticket this summer.

Today's Links: Behavioural Economists in "Treasury" and "Agencies"

1. Department of Finance Capacity Review July 2009: A number of areas where further skills developments were seen to be needed:
• Policy analysis
• Evaluation skills
• More economists, particularly skills in behavioural economics
• More expertise in regulatory impact analysis

2. Businessandleadership.com: The UK’s Institute of Practitioners in Advertising (IPA) has launched a Behavioural Economics Think Tank (BETT) to "advance understanding around disparities between what consumers say they’ll do when making choices about brands and what they actually do". The think tank is being led by IPA president Rory Sutherland, who is focusing on behavioural economics during his presidential term as he believes it can transform marketing effectiveness.

3. Brief biographies: of the members of the IPA's Behavioural Economics Think Tank.

4. The Institute of Advertising Practitioners of Ireland hosted a talk by Rory Sutherland earlier toay in the National Gallery of Ireland.

5. "Why Agencies Should Adopt Behavioural Economics to Achieve Success" - Rory Sutherland talks on the 4th June in Belfast.

6. TED.com: A profile of Rory Sutherland (Vice-Chairman of Oglivy), and a link to his TED-talk: "Life lessons from an ad man". Here's a link to Rory's blog.

7. The Irish Marketing Society has organised a seminar on behavioural economics to take place on the 18th May. Details here.

8. Karl Deeter: Behavioral Economics & Arrears - avoid repossession by reward.

9. TED talk by Sebastian Wernicke: How to create a guaranteed killer TED talk with the aid of statistical analysis. HT: Garr's posterous.

Looking Forward to a Speedy Recovery..

I went to Dr. Alan Ahearn's talk last night about "Economic Firefighting". Dr. Ahearn is the special advisor to the Minister of Finance and is probably the main architect of the government response to the crisis, NAMA, and the on-going recovery efforts of the State. A serious job, to say the least.

The talk was interesting and largely positive about Ireland's prospects as we emerge from recession. Dr. Ahearn concurred with growth and employment forecasts and indeed with the views expressed by Mr Lenihan late last year - that the "worst is now over". He also attempted to dispel misconceptions about the "bank bailout" -- debunking the idea that the government are bailing out bankers and developers and arguing that the government are in fact bailing out the country and in doing so securing it's future viability and prosperity. The issue of NAMA for the "small-guy" was also convincingly dispelled as an illogical move. (aside: I think a temporary extension of the current '12-month foreclosure rule' for domestic homes is an area worth considering).

In general, I was in agreement with the arguments presented. There is, however, one thing that I want to pick-up and throw out there -- and it relates to the banks.

To me there are three distinct issues muddled up in our thinking about the banks here. The first issues is that the banking system needed to be salvaged to save the country from ruin. The second is that the banking system needs to be recapitalized in order to function. And the third is that the banking system needs to lend and take risks in the future to secure the country's future stability and prosperity. To date the main analysis and discussions have been about the first two issues. However you like it, NAMA is now a shut case; the deal is done and further energies debating its merits or otherwise are a waste. I think the issue that now needs to come into focus is HOW the banks will operate once they are recapitalized and what role the State can play in regulating and directing their operations.

At present we seem to be content with the notion that "if the banks have funds they will lend and all will be well!" This assumption is the height of our sophistication on this issue to date. I would argue that we're being foolish here, at best, and certainly missing an opportunity. I don't think anyone want banking as it was, or anything close to that and we're assuming that the banks will have learned their lesson -- they probably have to some degree but they will also have learned that they are invincible which isn't fortunate for the state. We know that need prudential banking, and we now know that we need banking to operate with some awareness of the macro environment and their role with in it. They certainly need to be willing and able to take risks again but they also need to remain civically responsible.

So what's happening on this issue? Well it appears that the Financial Regulator/Central Bank has been seriously reinvigorated and they are taking clear steps like increasing capital reserve requirements and sharpening their monitoring and intervention functions. This is all sensible, expected, and welcome. But is there room for some innovation here? One suggestion I would make is that we discuss this.

In particular, I think we should discuss whether the government could issue directives (or similar) to the banks, based on the macro-realities of the day, that would guide the types of lending and risks they take. In the current short/medium, such an ability would ensure that banks aren't taking misguided risks from their new knowledge of invincibility (moral hazard!) and, moreover, that they can actually facilitate real prosperity by lending to productive-enterprises rather than speculative-enterprises for example.

Here are two specific ideas that I think should be discussed further:

One, Ireland needs export-led growth yet Irish enterprises struggle to get credit lines open... Can the government do anything new to ensure that our re-capitalised banks will actually lend to Irish companies and enterprises that are seen as being of particular importance to the recovery and real and sustainable growth in the future?

Two, levels of personal debt in Ireland are some 220% of disposable income! This ratio is amongst the highest in the world. Do we want the re-capitalised banks to extend credit along these lines further and just do retail business as usual? Is there any sense, or legitimacy, in capping this level of debt? what is a sustainable and reasonable level for the country?

BizCamp Talk

My talk on social science, business and economic recovery is available here. It drags a little at the start as it took me a while to get going to be honest. But the discussion with the audience, mostly small business owners, was really interesting and lasted a lot longer than initially anticipated. It is probably worth listening to in order to understand how this audience reacts to ideas from behavioural policy. The basic point of the talk is to encourage a move toward experimentation in economic policy, with a particular focus on interdisciplinary policy design. It draws heavily from the experimental work of Thaler, Laibson, Chetty, Karlan and others as well as the wider behavioural economics literature. I attempt to map the recent major developments in behavioural economics on to the modern Irish policy space. I'm not sure how successfully I did this but I think I did start a good debate.

Iyengar - The Art of Choosing. Not A Review

Sheena Iyengar's book "The Art of Choosing " is well worth a read for anyone interested in behavioural economics, decision making and related areas. Iyengar is a Columbia Professor who works on choice theory. The book is in a similar vein of other recent books such as Predictably Irrational and Nudge that bring research in this area to a massive audience. The opening chapters discuss her very interesting life story, being a blind daughter of Indian Sikh migrants to Canada. The level of personal disclosure paints some poignant pictures without being overly intimate. In general, the discussion operates on a more intense level than similar books, while still describing many interesting experiments conducted by herself and more generally. In particular, there is more emphasis on the relation of choice to identity, culture, survival than in more economic policy orientated treatments.

A short video about the book is linked here

Assorted Links: Irish Vacancies and Redundancies Data

1. RendezVous353 aims to connect Irish business people around the world, encouraging social interaction and creating a platform for business networking amongst the diaspora. Here's a feature on the website in Silicon Republic.

2. Enterprise, Trade and Innovation press release: Minister O’Keeffe to lead drive to create 117,000 jobs over next 10 years

3. Enterprise, Trade and Innovation report: Jobs and Growth: "sets out the core policies and actions to drive productivity improvements, to grow exports and create new sustainable jobs"

4. The IrishJobs.ie on-line jobs index for Q1 reveals an increase of 9% in jobs advertised online in Ireland since Q4 2009. Medical professionals and healthcare sector sees the biggest increase in new jobs advertised. Retailing, wholesaling and purchasing shows the largest decline in new jobs advertised.

5. IrishJobs.ie on-line Salary Survey (2010): "benchmark salaries for new employees in most jobs... reduced by 5-20% since 2008"

6. The Fas/ESRI Employment and Vacancies Survey: the most recent survey information that I can find is for March 2008

7. Brendan Walsh discussed Irish vacancies data in the Quarterly Economic Commentary in 1977: Unemployment, Vacancies and "Full Employment" in the Irish Manufacturing Sector

8. The Monster.ie U.S. online jobs index rose in April for a third straight month and posted its largest year-on-year percentage gain since July 2007. Story from Reuters.

9. Redundancy.ie: Irish redundancy statistics provided by the Irish National Organisation of the Unemployed. Breakdowns are possible by gender, month and county.

Bernanke on Well-Being

Philip Lane on Irisheconomy links to a recent address by Ben Bernanke making the case that economic factors do a better job that we might expect in determining happiness. The recent work of Stephenson and Wolfers with the Gallup world data has bolstered the view that getting economic fundamentals correct is the best way of promoting happiness though Easterlin, in particular, has been fighting back against this idea (see previous post ).

Youth Summer Employment Programmes

A continuing theme on this blog for the last three years has been the enormous empirical evidence demonstrating firstly that this recession is impacting young people disproportionately, that youth unemployment has substantial negative impacts outside of the basic first-round economic effects and that there is an urgent need to bump this issue up the policy agenda in Ireland. Policies that have been discussed include large-scale internship programmes, "kurzarbeit"policies that would encourage job sharing, enhanced job training programmes properly design and evaluated.

Mathematica Policy Research have been examining some of the programmes developed under the Recovery Act in the US. Linked here (thanks Mary Doyle from Geary for emailing this to me) is a document examining the development of major youth summer employment programmes financed under the act. Over 355 thousand people aged 14-24 took part in this particular programme. The evaluation is mostly at the level of implementation, reporting very high levels of satistfaction on both the side of employers and employees with the programme. One of the key metrics used, a measure of "work readiness" increased among participants. The evaluation itself suffers somewhat from the fact that this programme was rolled out very quickly to a "use or lose it" funding timescale and thus much of the evidence is suggestive rather than conclusive. However, there is a huge amount of process information contained in this document that any Irish policymaker interested in attempting to address the youth labour market should examine. In particular, the potential efficacy of a programme like this for improving post-internship outcomes among recent graduates and unemployed school leavers should be examined.

Ask Carole: an evolutionary agony aunt just for you

In some previous posts I offered some insights from psychology into affairs of the heart. Just trying to be helpful. Unbeknownst to me that fine newspaper The Guardian has a regular column by an evolutionary agony aunt using peer reviewed research to shed light on all sorts of relationship issues that I would blanche at discussing. She's the real deal.

http://www.guardian.co.uk/science/series/ask-carole

Econtalk Podcast with Taleb

Nassem Taleb talks to Russ Roberts (h/t Gerard O'Neill). There is very little that I could find to disagree with Taleb in terms of his ideas on explanation, forecasting and on behavioural biases. The way we are using econometric models in finance and the manner in which we communicate on financial ideas in the media and policy debate is killing a lot of innovation in our society and robbing us of our ability to deliberate properly on the major 50 year challenges that this world is facing. I wake up every morning in Ireland now to the voice of some commentator or other telling me what is likely to happen to bond yields over the next few months. We seem to have forgotten that it is essentially impossible to forecast bond markets and if you could you certainly wouldn't run around telling everyone what was going to happen.

Taleb's basic essence is the argument for more contextualised, robust explanations that allow for human fallibility, outlier events and other factors that contaminate basic rational models of financial markets. His idea that debt itself is a fundamental source of instability are newer and harder to digest right now. I am terrified by some of the absolute stupidity that is taking place on our financial markets at the moment and it is difficult not to be somewhat sympathetic to his idea. We even witnessed a large collapse in the Dow tonight due to a panic reaction to a 'fat-fingered' trade whereby a trader accidently typed billions rather than millions when trading a major stock which triggered further trades. A lot of this jitteriness seems to be due to complete uncertainty as to who owns Greek debt and how much of it they are going to pay back.

Taleb-bashing is a pasttime among some academics but he is a prophetic thinker, not one who fills in all the gaps, but one that cuts to the chase of the profound issues of our time. In my opinion, he is actually more stimulating to listen to than to read and reminds us that being vaguely right is sometimes a more nobel aim than being precisely wrong.

Wilkinson -An Introduction to Behavioural Economics

I received an inspection copy of Nick Wilkinson's "An Introduction to Behavioural Economics" earlier this week. I confess that I had not read this before and have been working on a book myself, largely to use with my behavioural economics classes. However, I am glad that I have largely changed the focus of that effort away from a textbook as such and more toward a primer for a wider group. Wilkinson's book works very well as a textbook in behavioural economics and I will use it in my courses next year. The book starts with basic ideas of behavioural economics in terms of defining it with relation to standard models, outlining the methodological principles and objectives of behavioural economics and giving some core applications. The second section (Foundations) gives a very useful summary of value, preferences and choices, a chapter on decision making under risk and uncertainty and a chapter on mental accounting. I think this section will be extremely useful in helping students to set the framework for how the empirical work relates to the models they already know. Section three covers intertemporal choices and, along with the Frederick  et al 2002 review, is a fantastic core introduction to intertemporal choice. Section 4 covers strategic interaction and is a more manageable summary of this area than the tougher Camerer et al book, which is perhaps better for graduate level. Section 5 concludes with a discussion of rationality and the future of behavioural economics.

If I could levy any criticism at the book, it is that it focuses very much on experimental work particularly in game theory and choice and neglects the large recent emphasis on behavioural field experiments. This is partly a function of the fact that the field experiment approach is very new and I expect that the author will work on this if there is a new edition. In my own course, I place heavy emphasis on the Libertarian Paternalism debate as I have found that this really brings many of the issues in behavioural economics to life. Wilkinson has largely steered clear of this debate and many of the policy issues that he raises at the end (e.g. are men with more brothers more likely to be gay?; is there a biological basis to war?) are more suited to an introduction to psychology textbook than a behavioural economics text and I would certainly not recommend to use this book without supplementing it with examples like Save More Tomorrow (Thaler and Benartzi 2004) and related work. Again, I think this is partly a function of the fact that the last two years have seen a huge surge of interest in the direct policy application of behavioural economics and therefore this aspect may have been overlooked by the author when he was writing the main body. Overall, I think this is a very welcome addition and is, as far as I can see, the first book that could really be used as a textbook for behavioural economics for upper undergraduate courses.

The Economics of Internet Search

The comparison of Google Trends data (on the British Election) with polls, bookmakers' odds and prediction markets shows once again that we need to be careful when interpreting search volume data. While the (search-data related) innovations in unemployment forecasting may not be earth-shattering, what else can we learn from trends in seach queries? There needs to be a focus on what the analyst expects when typing in "zombie" or "inflation" or "dole" into a trend-analyser. Hopefully we can all agree that there is no such thing as a zombie. Unemployed people on the other hand, are a very real human problem, and growing in large numbers.

For example, do unemployed individuals looking for information about welfare payments type in "unemployment" or "dole"? Or something else? One experiment (view here) is to type in "unemployment", "dole" and "jobs" into Google Trends, separated by commas. A few observations can be made:

(i) The search volume for "jobs" is relatively stable over the last 6 years
(ii) News reference volume for "jobs" has exploded over the last 2 years, much more so than for "unemployment"
(iii) There is only enough search activity related to "unemployment" for it to register half-way during 2008
(iv) There is only enough search activity related to "dole" for it to register at the start of 2009
(v) There is a fall-off in search volume for "jobs" at the end of every calendar year

While much of this mirrors what we already know about recent economic activity, I had expected "jobs" to have a much higher search volume over the last year. We of course have to be very careful about drawing conclusions, but the stylised facts about search volume suggest that there were more people searching for jobs in 2004 and 2005 than there were in 2008 and 2009. We know that there were more people in need of a job in 2008 and 2009, so what is the explanation? Perhaps job-search is more intense during boom-times. In recessions, maybe people are less likely to search for a job (which they simply believe isn't there). This could of course be incorrect, but now there is an open question.

Other challenging questions about search data are currently at play in the commercial arena; it may be no coincidence that Google Trends was opened up to the public (including academics) in 2006, just as these questions were coming more to the fore. At present, Google, Yahoo and Bing are strongly focused on distinguishing between "interest" and "intent" in search data. There are obvious commercial implications, but solving this problem about interest versus intent would also help academic researchers. When somebody searches for "jobs" do they just want to *see what's out there* (maybe in boom times) or do they *desperately intend* to obtain employment (maybe in recessions)?

Maybe additional keywords would help in solving this interesting puzzle. If you search for "XBOX Price", Google can assume to some extent that you intend to buy an XBOX. Here is an article from last year about Google executives stating that "understanding people, health, communication, education and knowledge" is the next frontier of search. Here is a link to Yahoo!'s "Mindset" research project on 'Intent-driven Search'. Recently, there was an article in the Economist about about Qi Lu: the man behind Bing. According to him, the focus is firmly on "understanding user intent".

It's clear that understanding more about search is the big challenge: for the search-engine based advertising business, and for social scientists. And here is the main reason why search data is (or should be) so interesting for academics: we don't *ask* people for the information they provide in search queries. It's a simple statement, but it has merit. No matter how well-designed surveys are, there will always be things in the ether, trends in society, that will potentially appear in search data first.

Google Trends, Polls, Betting, Prediction Markets and the British Election

Those interested in Google Trends may find it worthwhile to bear the first chart (directly below) in mind, as the results of the British Election come through. The red line represents "Gordon Brown", the orange line "Nick Clegg", and the blue line "David Cameron".


A different picture is illustrated in the second chart (directly below). The red line represents "Labour Party", the orange line "Liberal Democrats", and the blue line "Conservative Party".


Of course, this type of information may have no predictive value. The UK Polling Report (an independent survey and polling news website) shows that the majority of polls paint a closer picture, but with a distinct lead for the Conservative Party. Could the higher search (and news) reference volume for "Gordon Brown" be due to an incumbency effect? Could the higher search (and news) reference volume for "Liberal Democrats" be due to a novelty effect? Of course, we can't attempt an answer until later in the week. Many punters have already placed their bets though: bookmakers estimate that up to £40m will have been bet on this election, smashing previous records.

Finally, the Intrade prediction market indicates that the Conservative Party have roughly a 90% chance of winning, as shown in the third chart (directly below).


The Inkling Prediction Market indicates here that there is a 66% chance of a hung parliament, and a 32% chance of a win by the Conservative Party.

Hal Varian, Chief Economist at Google, discusses prediction markets here in the NYT, from a few years ago. The emphasis in the article is on the "Pentagon-sponsored futures market in terrorism indicators (that) was announced and squashed in all of two days."

Paid Summer Research Internships UCD Geary Institute

Summer Internships UCD Geary Institute:

5 Summer Internships are available in the UCD Geary Institute working in the behavioural research stream and reporting to Colm Harmon and Liam Delaney. Candidates will receive a 1,600 euro stipend for the internship, which will last approximately 8 weeks, and will participate fully in the research activity of the Institute.  The Institute has housed many talented students and researchers over the last decade and this is a very strong opportunity to gain valuable paid experience in a top-class research environment. Successful candidates will be fully trained in key research areas and will be given wide scope to develop their own research interests through interaction with Institute staff. Candidates must be registered for a full or part-time recognised academic programme. 

Candidates ideally will be undergraduate or Masters students working in psychology, economics or cognate areas. We will give strong preference to candidates (i) with very high grades (ii) strong quantitative skills (iii) strong intrinsic interest in research (iv) strong desire to gain relevant research experience. Candidates should send a CV and cover letter outlining how you might benefit from this programme to Emma.Barron@ucd.ie before May 20th 2010. Candidates who have already submitted a CV and cover letter to the general intern programme will be considered but you should feel free to resubmit your CV if it has been updated.

Successful candidates will participate in research across a number of projects, including but not necessarily limited to those below.

1. National Pensions Framework: At least one candidate will work with a number of Geary researchers on a scoping study to examine the changes in the national pension framework. This will involve examining consumption and savings in Ireland from the perspective of behavioural economics.

2. Health and History in Ireland: One candidate will work on a large study of historical health conditions in 20th century Ireland. This work follows up a recent paper and set of theses. The paper below gives an example of the type of research being conducted in this stream.

http://www.ucd.ie/geary/static/publications/workingpapers/gearywp200943.pdf

3. Measurement of complex preference parameters. This work is a collaboration between colleagues in economics, psychology and medicine. This research examines how to measure very complex subjective economic phenomena such as time preferences and utility. Some recent working papers illustrate the basic ideas.

http://www.ucd.ie/geary/static/publications/workingpapers/gearywp200901.pdf

http://www.ucd.ie/geary/static/publications/workingpapers/gearywp200819.pdf

4. Behavioural Economics and Public Policy. One candidate will assist in the development of the ongoing teaching and research programme in behavioural economics and public policy. Full details below.

http://geary.ucd.ie/econpsych

5. Well-Being and Public Policy: One candidate will work on the ongoing research into Economics and Well-Being, part-funded by IRCHSS. Full details below.

http://geary.ucd.ie/wellbeing


Organisational Environment


The University

University College Dublin is a large and diverse university whose origin dates back to 1854. There are over 20,000 students based in five colleges. The University strives to achieve the highest standards in the advancement of knowledge through research and scholarly publications. It communicates that knowledge to successive generations of students through excellence in teaching. The University also makes an active contribution to the interests and development of the wider community - regional, national and international. The university is situated on a large modern campus about 4km to the south of the centre of Dublin. Further information on the University is available at www.ucd.ie .


The Geary Institute

The Geary Institute (formerly the Institute for the Study of Social Change) was established at University College Dublin in 1999 as a centre for political, economic and sociological research. The activity of the Institute is organised around research programmes involving researchers from the Schools of Economics, Politics and International Relations, Law, Public Health and Population Science from throughout the University, from other research groups in Ireland, and key strategic partnerships throughout Europe and the US. The Irish Social Science Data Archive (ISSDA) is also part of the Institute, an invaluable resource for the social science community in Ireland. The Institute is housed within a new building on the Belfield campus which provides up to date facilities for graduate students, staff and research visitors, as well as a seminar room, library, boardroom and common room. The Institute is directed by Professor Colm Harmon and the Institute Manager is Susan Butler. See www.ucd.ie/geary  for more information.


Informal Inquiries only to:

Liam Delaney

Telephone number: 716 4631

Email: Liam.Delaney@ucd.ie

New York Times Data-Driven Life

Socrates talked about the unexamined life not being worth living. Developments in wearable data collection and feedback technologies take this to a new extreme

link here

Common Sense Economics or just Economics?

I have been presenting to policy-makers for the last few years on ideas from behavioural economics. My main purpose in this has been to disseminate what I believe to be the most influential ideas from the global literature mainly to people in Ireland and to some extent continental Europe. It is frustrating when one sees such a limited number of ideas still exercising such a sway on the way we design institutions and implement policy in this and other countries. Regardless of current debates about the Irish Universities, I still believe fully in their remit to constantly pour out the best knowledge available to its academics and for their staff to be part of the process whereby such ideas change the world.

One limit in talking about our work is the use of the phrase "behavioural economics". For anyone with any sort of leaning in psychology, it triggers images of Watsonian behaviourism and I have frequently been hit with "but hasn't behaviourism failed in psychology and philosophy?". The reply to this is, of course, that behavioural economics has almost nothing in common with behaviourism as the old psychologists viewed it and is far more grounded in the cognitive revolutions in psychology in the 1960s and 1970s. Those of you from psychology backgrounds should think of behavioural economics as social psychology, neuropsychology and cognitive psychology applied to economic questions and the design of economic policy and institutions. Certainly linking it with the behaviourist paradigm makes sense in only a very specific sense.

A further complaint is the view that attempting to influence behaviour is reminiscent of the tactics of totalitarian regimes. I have started to call this the "Rasputin" critique in recent talks, with some of the comments reminding me of the unease some of the Russian nobility felt at a mystic having influence at court. While Thaler and Sunstein's Nudge has completely launched the discussion of behavioural economics on to the stage even in Ireland, it has also heightened the fears that behaviourally-inspired policies come from a place that neighbours more sinister forms of state control. I get this critique regularly, mostly from people who have read one article in the newspaper and have made their mind up, but also from people who have studied the topic.

I am penning longer versions of these ideas but I want to begin with the idea that the main contribution of behavioural economics to policy debates is a restoration of basic common sense in the assumptions we make about human behaviour. By allowing flexibility in the extent to which people are assumed to be fully rational, fully selfish, future orientated, adaptable to events, information processing and so on we are given a great opportunity to look at institutions that have failed miserably and to think about how to redesign them. Wrapping this in a banner of "behavioural intervention" or "behavioural change" is very limiting and will not be accepted in societies like Ireland where the very mention of behaviour from governments evokes a backlash.

If I were to summarise very briefly why this literature should now be the main influence on Irish economic policy, it is simply that it restores our ability to draw from basic things we know about how humans think and act to help us overcome the main problems that face us in the next 50 years. I am tempted to simply call this "common sense economics" and to take the resulting flak. Another temptation that I have mostly resisted is simply to call this Economics and to draw a temporal line between what is now Economics and what was considered Economics before this massive change took place.

I think this blog is not a bad place to start a debate about how we should bring ideas from behavioural economics into the policy arena and to think about whether packaging them as "behavioural interventions" is too limiting philosophically and damaging from the point of view of communication.

Rack off tobacco companies

Australians will ban all colour and branding from cigarette packaging and replace it with pictures of gangrened feet, amongst other things!

Here, we just recently put our swanky cigarette boxes out of view and without much fuss but the Australian plan is generating a lot of opposition, most of which is coming from obvious vested interests.

Tobacco companies' are proven masters when it comes to the dark art of persuasion and have always managed to wriggle their way around advertising restriction policies as they met them; the advertising of Dunhill "aftershave" is a clear example of their smooth cross-product branding acrobatics. This new government policy, which bans the use of colour, brand, and identity, is the ultimate way of curbing their influence. To my mind, blank packaging is defensible and seems fair. In addition the government could provide clear information on the risks associated with smoking to help inform consumers. This would be useful and honest, unlike what is being planned here.

Do the Australian government really know the probability of developing trenchfoot from smoking? Assuming they do, then they must know its not very high (given the few limbless smokers you see or hear about). So what we're dealing with here is actually a message that is inherently disingenuous. That's not good... nor is spreading such a message, with the intension of manipulating behaviour, in a realm that works by bypassing reason! are we really ok with this?

I'm pretty sure this is what used to call propaganda.

Ash cloud as Natural Experiment: Tastes for ferry travel

The perception that travelling between Ireland and mainland Europe by car ferry is like being on a famine ship full of truckers was challenged recently when an ash cloud closed European airports. Many travellers had no alternative than to sail between Ireland and the rest of Europe and apparently many were pleasantly surprised to discover how comfortable the experience was. So, has this random shock changed tastes?

Not much apparently. Here is the volume of searches for "Irish Ferries", the highest capacity operator between Ireland and the rest of Europe. As soon as the airports reopened the volume of searches returns to its baseline levels, which appear to be steady this time of year (see April 2009, below).

For me, the key insight of this result is that it proves that people do not converse as radio advertisements would have us believe: "Is Linda still stranded in Slovenia, Ann?"

"Oh no, Paul, she cruised home with Irish Ferries"

"Irish Ferries?"

"Yes, Irish Ferries! You know Irish Ferries now operate... Where are you going Paul?"

"With so many great Irish Ferries destinations to choose from, Ann, who knows where Irish Ferries might take me?"

If people actually spoke like this, we would see some residual effect in search volumes as Paul and his ilk go check out the great value deals. And so, it turns out that radio ads have been lying to us all along. Please make them stop.

Can you be happier than your wife?

Externalities abound in the real world and those within the household are some of the most salient. Perhaps the most salient occurs with regard to happiness, its hard to be happy if a loved one is not. So "you can't be happier than your wife". Unless you're a thoughtless git, that is. And if a big gap exists between the happiness of a couple, perhaps this leads to stress and ultimately a split. It can't help. The paper below looks at this and finds that, indeed, bigger gaps in happiness are predictive of divorce.
An important issue here is the granularity of measurement. If you measure happiness or life satisfaction on, say, a 20 point scale then you are less likely a couple on the same levels of measured happiness than if its a 10 point scale.
Intruiged by all this, I looked at life satisfaction in the SHARE data. It has a 4 point scale of life satisfaction (very satisfied,somewhat satisfied,somewhat dissatisfied,very dissatisfied). About 60% of individuals report the same level as their partner.
I didn't find any obvious predictors of this gap. Women are less likely to be more satisfied than their partners but largely because they report lower satisfaction in general.

You can't be happer than your wife:happiness gaps and divorce
C. Guven, C.Senik, H.Stichnoth
http://ftp.iza.org/dp4599.pdf