Proust, Nabokov, and intertemporal choice

In a recent post on whether the Fed can credibly pledge itself to higher inflation, Paul Krugman wittingly notes that “commitments are hard, especially in the future.” Making credible promises is a classic decision-making problem well beyond monetary policy, with a large literature in economics (e.g. Kydland’s and Prescott’s classic article) and in the social sciences more broadly (see, for example, this book). In fact, the root of the problem, namely the temporal dimension of choices, is a surprisingly common occurrence even in everyday life. An article on procrastination (aptly titled “Later”) in the October 11 issue of The New Yorker gives many examples and sums up effectively two key arguments. The first is the idea of a “divided self:”

[The] person who makes plans and the person who fails to carry them out are not really the same person [...] In that sense, the first step to dealing with procrastination isn’t admitting that you have a problem. It’s admitting that your “you”s have a problem.

The second argument is that a solution to this problem is self-binding, namely using “external tools and techniques to help the parts of our selves that want to work.” The classic example, discussed at length by Jon Elster (for instance in this book), is Ulysses asking to be tied to the mast to resist the irresistible voices of the Sirens.

The reason I am writing this is that several years ago I came across two literary passages that illustrate the two points perfectly, and this looks like a good time to share them.

First, Proust on the “divided self” (Du côté de chez Swann, Paris, Folio Gallimard, 1987, p. 371):

Jadis ayant souvent pensé avec terreur qu’un jour il cesserait d’être épris d’Odette, [Swann] s’était promis d’être vigilant et, dès qu’il sentirait que son amour commencerait à le quitter, de s’accrocher à lui, de le retenir. Mais voici qu’à l’affaiblissement de son amour correspondait simultanément un affaiblissement du désir de rester amoureux. Car on ne peut pas changer, c’est-à-dire devenir une autre personne, tout en continuant à obéir aux sentiments de celle qu’on n’est plus.

And here is Nabokov on self-binding (King, Queen, Knave, New York, McGraw-Hill, 1968, p. 86):

Martha had decided that tonight he would kiss her for the first time. Characteristically, she chose one of her monthly days lest she succumb too soon, and in the wrong spot, to a yearning that otherwise she could no longer resist.

Isn’t that beautiful?

PS: Nabokov being Nabokov, “he” is Martha’s nephew.

How to Study Things that Can Go Around in Circles

Two voters plus three voters makes five voters. If a party that used to hold four ministries loses one, it still controls three ministries. For many phenomena that we analyze in political science this linear world view seems appropriate or at least an acceptable simplification. But for many it does not. If terrorists used to attack at around 11pm, but now these attacks tend to happen two hours later, this means that they occur at 1am. If political candidates compete on a circular issue space, then a candidate moving far enough to the left will eventually end up at the extreme right. We measure such phenomena on circular scales: the 24-hour clock, compass direction, or calendar measurement. They do not have an origin, since the endpoints are connected.

Although examples for political events measured on circular scales abound, we still lack appropriate methodological tools to analyse this type of data. In an article recently published in Political Analysis, Jeff Gill and Dominik Hangartner start filling this gap. One of their applications analyzes the direction of party movements. This relates to a post by Romain Lachat (“Which Way from Left to Right“), where he conceptualized political competition in the Zurich municipal elections as taking place on a circle. The figure below shows the direction in which parties moved from 2002 to 2006. Most parties shifted to what many would call the economic right.


Figure: Directions of party movements in Europe from 2002 to 2006. Source: Gill and Hangartner 2010 (working paper version)

Another application contributes to research on violent conflict. Experts estimate the number of civilian fatalities in Iraq since the beginning of the Second Iraq War to exceed 80’000 deaths. An analysis of the time at which these incidents occurred (table 1), measured on the 24-hour clock, suggests that fatalities due to gunfire or mortar rounds happen on average earlier during the day than incidents due to bomb attacks, which form the reference category.

Table: Results for timing of attacks involving civilian fatalities in Iraq


While the signs of the coefficients indicate the direction of the relationships between the predictors and the time of incident, interpreting their size requires some trigonometric computations which the article describes in detail. The results suggest that gunfire casualties happen on average about one hour earlier than bombings. Moreover, their timing has shifted over the years. Directly after U.S. forces had invaded Iraq in 2003, bomb attacks used to occur Saturdays shortly before 8am on average. Such attacks now happen later during the day. The annual shift equals about one hour on average. I look forward to seeing papers that analyze circular data in political science!

“For to all those who have, more will be given…” The Matthew effect and welfare politics

The “Matthew effect” denotes the phenomenon of accumulated advantage: those who have (power, capital, resources, fame, citations, etc.) get more, whereas those who have not get less. Welfare politics is not so different. Since the important works of scholars like Esping-Andersen, Evelyne Huber and John Stephens, or Kees van Kersbergen, we know that “social policy” is not always about helping the weak and the poor. Indeed, continental European welfare states – such as Germany, Switzerland, France or Austria – tend to provide social benefits that are proportional to people’s incomes. It’s called social insurance and it’s meant to stabilize social stratification. Hence, the patron saint of continental welfare states is certainly closer to Matthew than to Robin Hood, and this explains why the mere level of social spending is a pretty bad indicator of “redistribution”.

All this has been known for a while now, but what many do not realize is that the battle between Matthew and Robin Hood is very much alive in current West European welfare politics. Consider the reform of the Swiss unemployment insurance that was adopted a few weeks ago: benefit levels for the core workers with stable, well-insured jobs were left intact, whereas cutbacks were enacted in particular for the young, the elderly and for women re-entering the labor force. Matthew sends his regards.

This represents just an example of a current welfare reform trend that the literature calls “dualization”, meaning that generous social security and income protection is maintained for labor market insiders with stable, good jobs, whereas outsiders in atypical and unstable employment are relegated to means-tested safety nets, such as social assistance. Thereby, welfare states create two categories of (potential) beneficiaries: the core workers and the rest.

In a recent paper, Hanna Schwander and I have shown that continental European welfare states create deeper insider-outsider divides than the Nordic or the anglo-saxon welfare states. What is more, taxes and transfers in continental Europe are designed such that they not only reproduce, but even increase the gap between insider’s and outsiders’ incomes. In a different paper, we also found that these differences are reflected in the attitudes of insiders and outsiders towards welfare policies: insiders want more social insurance and outsiders want more redistribution. Both groups seem well aware of what they benefit most from. Hence, dualization may very well become a major conflict line in current distributional politics.

Two questions, however, are crucial in evaluating the importance of dualization for the distribution of resources and life chances in the countries of continental Europe. First, what level of benefits and services is provided for the outsiders? If outsiders rely on relatively generous safety nets, dualization must neither lead to increasing poverty levels nor to political conflict. Countries vary largely in the generosity they provide for the “losers” of post-industrial capitalism in terms of income and social investment. Second, what are the politics of dualization? Who do insiders and outsiders vote for? Who represents their interests in the policy-process and why? Both questions are obviously related: where welfare states create deep divides between insiders and outsiders, this divide is more likely to become a political conflict line structuring representation. And these patterns of representation in turn affect the distributive outcomes of current reforms.

The Swiss National Science Foundation has just decided to fund a new project Hanna Schwander and I will start in January to find answers to precisely these questions. By means of new data on incomes, electoral behavior and party positions, we want to shed light on the cross-national variation of insiders’ and outsiders’ economic situation and political representation. Thereby, we hope to understand better why the battle between Matthew and Robin ends so differently in different countries.

We matter, but maybe not as much as we think

What difference does the quality of education make for student outcomes? Establishing a causal relationship is difficult especially for PhD students, because it is likely that the best students are drawn to the best departments, so that a positive correlation between departmental strength and students’ success is at least in part due to a selection effect. An article in the latest issue of the Journal of Political Economy uses a smart identification strategy, namely the expulsion of mathematics professors in Nazi Germany as an exogenous shock to faculty quality. The abstract sums up the main results:

I investigate the effect of faculty quality on PhD student outcomes. To address the endogeneity of faculty quality I use exogenous variation provided by the expulsion of mathematics professors in Nazi Germany. Faculty quality is a very important determinant of short- and long-run PhD student outcomes. A one-standard-deviation increase in faculty quality increases the probability of publishing the dissertation in a top journal by 13 percentage points, the probability of becoming a full professor by 10 percentage points, the probability of having positive lifetime citations by 16 percentage points, and the number of lifetime citations by 6.3.

These effects look sizeable but maybe not as large as we, as professors, like to think. Self-selection is probably as strong a determinant of success as departmental quality, possibly even more.

As an aside, this research is a nice illustration of the causal inference trend that is well established in economics and is catching up quickly also in political science. In this regard, see also this previous post.

What is policy diffusion and why should we care?

Policy diffusion (the idea that the policy choices made in a given place and time are influenced by the policy choices made elsewhere) is a topic that I have been researching for some time (see here, here, here, here, here, here, here). One of the leading scholars in this area is Craig Volden. In this interview, he gives an excellent overview of the topic with an emphasis on the American context, drawing especially on his article on the diffusion of anti-smoking policies among US cities (co-authored with Charles Shipan):

A few highlights:

- A specific form of diffusion, policy learning, is implicit in arguments about the benefits of federal structures, namely, that decentralization stimulates policy innovation and the diffusion of best practices. However, what is usually neglected is that diffusion can follow also other, less desirable logics.

- Diffusion should not be reduced to geography. Geographic proximity is often a good proxy for policy interdependence, but it usually cannot be linked to a specific argument about the nature of the diffusion process, or, in other words, what specific mechanism(s) drive it.

- Measuring diffusion and isolating diffusion mechanisms empirically is hard. In fact, Craig could/should have emphasized this point more clearly in the interview. Also, in my opinion the work that he cites is not his most successful in this respect. When it comes to identifying diffusion mechanisms clearly, his best research so far is his study of of Children’s Health Insurance Program, in which he found that states are more likely to imitate programs that are associated with an increase in insurance rates among children. This is quite convincing evidence of learning.

- Anti-smoking policy are an interesting area for the study of policy diffusion. I agree.

- Craig mentions work in progress on the diffusion of campaign ideas among candidates. Sounds cool! I agree that politics should be integrated more explicitly into policy diffusion theories. A couple of articles studying the political dimensions of diffusion have just been published (here and here).

If you have 17 minutes to spare, watch the whole thing.

Erotic capital

From the latest issue of the European Sociological Review:

Madonna flaunted it in her Sex book, and still has it at 50. Jesus Luz, her toyboy lover, clearly has it, but it is rather easier at 22 years. Pierce Brosnan has it, even as he ages, long after dropping the James Bond role. Catherine Deneuve still has it, remaining sexually attractive after she reached 60. The sexy, energetic singer Tina Turner, with her fabulous legs and erotic voice, still had it at in her 50s. The commodity is erotic capital, to which sociological and economic theory have been blind, despite its palpable importance in all spheres of social life. Writers and artists are very sensitive to it. Shakespeare captured it nicely when describing Cleopatra: ‘Age cannot wither her, nor custom dull her infinite variety.’ The expanding importance of self-service mating and marriage markets, speed dating, and Internet dating contributes to the increasing value of erotic capital in the 21st century. Sociology must rise to the challenge of incorporating erotic capital into theory and empirical research.

I see a lot of potential for participant observation.

Just Another Talk Shop? International Institutions, European Summits and Financial Markets

Many commentators hold the view that international diplomacy does not affect financial markets in any notable way. Especially since international decisions require consent by all actors, this de facto unanimity requirement allows every government to torpedo any attempt to bring about a collectively binding agreement. What we observe then in the theatre of international diplomacy and negotiations is a sometimes entertaining, yet economically ineffective play. Governments meet in “talk shops” and make lofty proclamations, but produce nothing more than “hot air” that markets do not care about.

In a recently published article, Gerald Schneider (University of Konstanz) and I take issue with the view that the results of deliberations in multilateral fora are “hot air”. Our focus is on decision-making in the European Union’s (EU) key intergovernmental body in the domain of EU foreign and security affairs. As is the case for most international institutions, the unanimity requirement governing this body allows nationalist governments to torpedo any attempt to build up a credible European defense force and a unified foreign policy stance.

We argue that investors react positively to a successful strengthening of Europe’s military component – a vital part of the intensified cooperation within the European Security and Defense Policy (ESDP) – since such decisions increase the demand for military products and raise the expected profits in the European defense industry. We find that financial markets react positively to those summit decisions which consolidated EU military capabilities and the ESDP. Each of these substantial Council decisions increased the value of the European defense sector by about 4 billion Euros on average. This shows that multilateral decisions can have considerable economic and financial repercussions.

Clearly, this is not to say that the skeptical view many hold about the effectiveness of international institutions, diplomacy and their relevance for the economy is incorrect. Yet, the potential for effective decision-making within international institutions that is relevant for markets may be underestimated, because we lack systematic evidence on when and how it matters. Our results also suggest that political scientists may detect economically crucial events in international relations by studying the way in which markets differentiate in the short run between events that are important to them and those that will remain “hot air”.

“Left power”, i.e. …

In social science, we strive to replace names by variables. Contrary to e.g. historians, our primary interest is not to analyze what role Silvio Berlusconi plays in the disheartening erosion of democracy in Italy (… yes, I am on vacation in this terrible and wonderful country), but rather to investigate to what extent a particular configuration of media-ownership and –consumption, in combination with a weak state contribute to undermine the rule and legitimacy of law.

This effort of dealing with abstract concepts, however, entails a range of risks: most importantly, concepts may over time acquire a “life” of their own, meaning that the concept – and its operationalization – remains stable, while the world keeps turning. Thereby, the concept may eventually measure something new, while the empirical results are still interpreted with reference to the original meaning. A prominent example is the use of the variable “left power” (measuring vote shares or seat shares in parliaments and cabinets) in comparative political science research. In myriads of regression models, political scientists test, re-test and control for the effect of “left power” on almost everything, from welfare policies to state spending to political stability, corruption, macro-economic policies, etc. etc. What is more, the declining explanatory capacity of “left power” is one of the main insights of much comparative political-economic research.

But what do we measure, when we add the variable “left power” to our models? What does it mean when the “left power” coefficient in a regression explaining generous and interventionist government policies declines over time?

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First Study on Publication Activity of Swiss Political Scientists Published

The slogan “publish or perish” is certainly appropriate in the sense that, in most countries and universities, becoming a professor is impossible unless the respective candidate has published. This slogan does not tell us, however, how many publications of what type are required to make it into and survive in academia. There are, of course, no absolute standards. As in any competitive situation, how good is good enough depends on how good your competitors are. Fair enough. But can we really compare in any meaningful way political scientist A with political scientist B or any given peer group of A? Can we compare political science department A with department B? Can we compare academics and institutions in country A with those in country B, strongly differing national academic traditions, requirements, and capacities notwithstanding?

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How much division of labor for Swiss political science?

Over at the University Blog, Ferdinand von Prondzynski, President of Dublin City University between 2000 and 2010, writes:

One crucial issue facing Irish higher education over the next while will be institutional diversity. Broadly the question goes like this: we are a small country, so why do we need seven universities that cover more or less the same territory, and a dozen or so institutes with the same mission, and some other colleges? Why not identify a specialism for each and then ensure they are the best they could be in that area? Or maybe, why not identify one or two all-rounder institutions, with everyone else occupying a niche?

These questions are highly relevant for the Swiss political science landscape.

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