Improbable Research

Here’s the new episode — #121, “Big Bank Opera Rehearsal, Act 1″ — of the Improbable Research TV series.

The episode depicts an early rehearsal of Act 1 of “The Big Bank Opera”, in which stylish bankers in a swanky Wall Street bar explain the explosive rise and fall of big banking and big bankers.

This mini-opera has music by L.v. Beethoven & G. Rossini, and words by Marc Abrahams.

Starring Maria Ferrante and Ben Sears, and Branden Grimmett, it premieres October 1, 2009 as part of the 2009 Ig Nobel Prize Ceremony, at Sanders Theatre, Harvard University. It will be webcast live at improbable.com.

(This rehearsal happened at the home of Nobel Prize winner (Chemistry 1976) William Lipscomb. Professor Lipscomb will play a supporting role on stage in the premiere.)

To see this episode, click on the image at right, and you will be whisked to YouTube (where you can subscribe, if you like, to the Improbable Research channel).

Garbage In/Garbage Out: A Critique of Fraudulent Financial Reporting: 1987–1997 (the COSO Report) and the SEC Accounting Regulatory Process,” Abraham J. Briloff, Critical Perspectives on Accounting, vol. 12, no. 2, April 2001, pp. 125–48 (http://dx.doi.org/10.1006/cpac.2001.0458). The author, at the City University of New York, reports:

“According to traditional wisdom, the efficiency of a sanitation department should not be measured by the amount of garbage it picks up, but instead by what is left behind. This axiom came to mind regularly as I reviewed and reflected on “Fraudulent Financial Reporting: 1987–1997 An Analysis of US Public Companies,” a report commissioned by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)….

“Most certainly had the authors of the study sensitized their olfactory organs they would have
realized that the garbage, which they thus picked up for their arithmetic recycling, was not representative of the really stinking stuff which is contaminating the accounting and financial reporting environment.”

(That’s an excerpt from the article “Financial Meltdown,” Published in AIR 15:3.)

Inevitably, some researchers fixate on celebrities, neither using nor even acknowledging the power of modern bloodcomposition, finger-length, and genetics analysis tools.
“Superstar CEOs,” Ulrike Malmendier and Geoffrey Tate, SSRN paper #972725, March 15, 2007.

The authors, at University of California Berkeley and at University of California Los Angeles, respectively, explain:

“We analyze the impact of winning high-profile tournaments on the subsequent behavior of the tournament winner in the context of chief executive officers of U.S. corporations. We find that the firms of CEOs who achieve “superstar” status via prestigious nationwide awards from the business press subsequently underperform beyond mere mean reversion, both relative to the overall market and relative to a sample of “hypothetical award winners” with matching firm and CEO characteristics. At the same time, award-winning CEOs extract significantly more compensation from their company following the award, both in absolute amounts and relative to other top executives in their firm.”

(That’s an excerpt from the article “Financial Meltdown,” Published in AIR 15:3.)

Insults just aren’t what they used to be, according to a study called The Decline of Public Insult in London 1660-1800 by Robert B Shoemaker, professor of British history at Sheffield University.

Shoemaker pored over records of court proceedings from the late 16th through to the early 19th centuries, paying special attention to the insults. Time was, insulting someone in public – or even in private – could easily propel you into court, and thence, if the insult was good or your luck wasn’t, to jail.

Shoemaker charted the number of insult-fuelled prosecutions in the consistory court of London over those centuries. “The pattern is clear,” he writes, “a massive increase in the late 16th century to a peak in the 1620s and 1630s, followed by a collapse … By the late 18th century, per capita prosecutions in London had fallen to only one or two per 100,000 per year.”

By the late 1820s, the number of prosecutions had dropped to an insulting one or two, total, per year….

So begins this week’s Improbable Research column in The Guardian.

‘Pointless’ university studies to be weeded out by new government panel

—Changes to government funding may force academics to prove that their inquiry has real-world relevance—

So say the headlines on a September 23, 2009 report in The Guardian.

The poor souls who become official judges of these matters might have a miserable time of it.

It’s simple to decide what’s important and what’s not.
It’s simple to decide what’s valuable and what’s not.

But it’s not always simple to decide those things correctly.
Sometimes it’s not even possible to decide those things correctly.

The Ig Nobel Prizes are a minor example of this. Look at the list of all the past winners. We have seen near-violent arguments break out as to which of the winning achievements are (1) important or (2) trivial or (3) valuable or (4) worthless or (5) all of the above or (6) may seem, after a few decades, rather different than they now do. You may have seen similar arguments about the winners of any group of prizes  — or, more important, about any group of projects of any kind.