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A Financial Times-ly look at the prizes

Wednesday, October 12th, 2016

Tim Harford wrote a lovely essay in the Financial Times, about the Ig Nobel Prizes. Here’s a chunk of it:

The Ig Nobel prizes: in praise of ridiculous research

…one of the Ig Nobel’s charms is that this ridiculous research might actually tell us something about the world. David Dunning and Justin Kruger received an Ig Nobel prize in psychology for their discovery that incompetent people rarely realise they are incompetent; the Dunning-Kruger effect is now widely cited. Dorian Raymer and Douglas Smith won an Ig Nobel in physics for their discovery that hair and string have a tendency to become tangled — potentially an important line of research in understanding the structure of DNA. Most famously, Andre Geim’s Ig Nobel in physics for levitating a live frog was promptly followed by a proper Nobel Prize in the same subject for the discovery of graphene.

mitchblunt-ft-drawing

A whimsical curiosity about the world is something to be encouraged. No wonder that the credo of the Ig Nobel prizes is that they should make you laugh, then make you think. In 2001, the Ig Nobel committee did just that, awarding the economics prize to Joel Slemrod and Wojciech Kopczuk, who demonstrated that people will try to postpone their own deaths to avoid inheritance tax. This highlights an important point about the power of incentives — and the pattern has since been discovered elsewhere.

Alas, most economics Ig Nobel prizes provoke little more than harsh laughter. They’ve been awarded to Nick Leeson and Barings Bank, Iceland’s Kaupthing Bank, AIG, Lehman Brothers, and so on. The first economics prize was awarded to Michael Milken, one of the inventors of the junk bond. He was in prison at the time.

Fair game. Still, surely there is something in economics that is ludicrous on the surface yet thought-provoking underneath? (The entire discipline, you say? Very droll.)…

Gold-digging ants – an(other) explanation

Monday, July 11th, 2016

“In northern India there is a sandy desert and in this desert there live large ants, smaller than dogs but larger than foxes. A few ants that have been caught there may be seen at the king of Persia’s place. When digging their holes these ants throw out soil just like the ants in Greece to which they are similar in appearance. The sand thus thrown out contains gold and to gather this sand the Indians go into the desert.”

AntsNGold

So wrote Herodotus somewhere around the middle of the 5th century BC. But, although there are more than 150 references to the creatures in medieval texts, not everyone is convinced – and there are no scientific records of ants that big. Perhaps their size was exaggerated? Maybe they were mistaken for some other animal? Another explanation is provide by medieval researcher Thomas Reimer [whom Improbable cannot as yet locate] who suggests that :

“The scare aspect of the story is ascribed to the fact that obtaining the gold from such deposits would have been very easy and the gold miners had to ward off competition by other diggers. Any gold rush would have endangered their profits and lowered the value of the gold on the market. Quite obviously there is no basic difference between ancient and modern economics!”

$ee (£15 plus taxes) Larger than foxes – but smaller than dogs: The gold-digging ants of Herodotus in Reinardus. Yearbook of the International Reynard Society, Volume 19, Issue 1, 2006, pages: 167 –178.

Note: The illustration is from the 14th century bestseller ‘The Travels of Sir John Mandeville’

Further reading: Ants at the Medieval Bestiary

Also see: (peculiar old animal related) Tracking down the Getulian dog

Rejoice? Run? Hide? The Dawn of Experimental Econophysics

Tuesday, February 23rd, 2016

Experimental EconophysicsEverything can be explained, to some degree, by marrying economics to physics. This book does that:

Experimental Econophysics: Properties and Mechanisms of Laboratory Markets, by Ji-Ping Huang [pictured here], Springer, 2014, ISBN 978-3-662-44234-0. The author explains:

180px-Jphuang“Experimental Econophysics describes the method of controlled human experiments, which is developed by physicists to study problems in economics or finance, namely stylized facts, fluctuation phenomena, herd behavior, contrarian behavior, hedge behavior, cooperation, business cycles, partial information, risk management, and stock prediction. Experimental econophysics along with empirical econophysics are two branches in the field of econophysics.”

BONUS: Principles of Topological Psychology

The Allen-Alchian (theorem) Explains Why the Internet Is Made of Cats

Thursday, November 5th, 2015

Dr_PottsDr. Jason Potts Centre Fellow and Project Leader in the ARC Centre of Excellence for Creative Industries and Innovation, Queensland University of Technology, Australia, explains in the special ‘cute’ issue of the M/C Journal, Vol. 17, No. 2 (2014) why the internet is made of cats (with reference to the Alchian-Allen Theorem).

Supporting material here

 

Candy elasticity as a sticky, gooey innovation in economics

Saturday, July 25th, 2015

Economics, candy, and politics have found a new way to mix. This study makes that, at least, clear:

karlanCandy Elasticity: Halloween Experiments on Public Political Statements,” Julian Jamison and Dean Karlan [pictured here], Economic Inquiry, epub June 15, 2015. (Thanks to Sendhil Mullainathan for bringing this to our attention.) The authors, at the Consumer Financial Protection Bureau, Washington, DC, and Yale University, explain:

We conducted experiments during trick-or-treating on Halloween in a predominantly liberal neighborhood in the weeks preceding the 2008 and 2012 presidential elections. We decorated one side of a house porch with McCain material in 2008 (Romney material in 2012) and the other side with Obama material. Children were asked to choose a side, with half receiving the same candy on either side and half receiving more candy to go to the McCain/Romney side. This yields a “candy elasticity” of children’s political support. Results vary by age: children ages nine and older were two to three times more likely to choose the Republican candidate when offered double candy for voting Republican compared to when offered equal candy, whereas children ages eight and under were particularly sticky and did not waver in their choice of candidate despite the offer of double candy….

Children’s responses to the candy incentives varied by age, however. Younger children’s preference for Obama was sticky with respect to price, but older children’s preference for Obama was elastic. This result was first observed in 2008 and then successfully replicated in the 2012 experiment. We discuss several interpretations in the conclusion, including a differential response to symbolic versus monetary rewards, a parental-contamination story for the younger children, and the simplest possibility: that younger children just didn’t understand the task as much and so made the political choice they did understand.

Improbable Research