Cowen on Food/Kuehn on Wineries

From that last post - I'm struck by how much of his advice transfers over to visiting wineries. I imagine this applies everywhere, but of course I'm most familiar with Virginia:

- The crowded places with the rented van services bringing lots of laughing women around are always the worst.

- There are a few grapes that do better in Virginia: Viognier, Cab Franc. Because of this lots of places have a signature wine of that varietal. That's a stand-by when you're tasting in Virginia, but because of that it can be deceptive. Not all are good.

- Similarly, there's a big variety of Chardonnay's out there because it's familiar. There are many good Virginia Chardonnay's, but you have to actually look for them.

- If you can taste with an owner or winemaker instead of just someone at the bar your experience will be ten times better. If you make it clear that you know something about Virginia wine you'll get a lot better service and often they'll pull out a lot of extra wines they don't serve to other customers. If they start drinking with you, it's a very good sign. We've literally talked with a wine-maker for over an hour at a tasting. If they're out in the tasting room, it means there's not a lot of work to do at that time of the year and they love talking to people and tasting with people that love talking to them.

- Lots of people get excited when new wines are released. I don't. I've never understood this. Wines are never as good when they first get released. Don't run out when you get an email from them saying they just released something - just wait a while.

- Do go to brand new wineries. They can be very surprising. People are still enthusiastic about what they do and they've been experimenting for a few years with exactly what they want to put forward (unlike restaurants, winemakers are operating for a while before they open up to the public - often several years). It's surprising how good new wineries can be - and if they are good you want to patronize them to keep them in business.

- Unfinished tasting rooms (like barns or framed rooms without any drywall up yet) are always better. It means the owner has been focusing on the right thing: the wine. I can think of four or five unfinished tasting rooms that have all had high quality wine.

- If you like a winery, find out who they are friendly with. Virginia wineries (maybe other regions?) are incestuous. Winemakers often work at a couple places. People know each other socially. Friends who help out with a winery start their own. Grape growers who supply wineries for years decide to start making their own wine. Styles and methods flow through social networks. If you like winery X and you find out winery X has connections to winery Y and Z, go to winery Y and Z, and you're likely to get a new twist on something you already know you like.

- Finally - terroir really does matter. We stick around Loudon County a lot for proximity, but going into the piedmont type areas or into the mountains really gives you different wine, so make sure you go further afield when you can.

Cowen on Food

I'm sure all of you have heard about his new book. I've been prety irresponsible in usually glossing over his food posts on Marginal Revolution, which is a shame since I live near him so he's often talking about restaurants that I've heard of or could find easily. I am trying to get the gist of this book, though - this is a good short article summarizing some of its points. I especially like this:

"At fancy and expensive restaurants (say, $50 and up for a dinner), you can follow a simple procedure to choose the best meal. Look at the menu and ask yourself: Which of these items do I least want to order? Or: Which one sounds the least appetizing? Then order that item.

The logic is simple. At a fancy restaurant, the menu is well thought-out. The kitchen’s time and attention are scarce. An item won’t be on the menu unless there is a good reason for its presence. If it sounds bad, it probably tastes especially good.

Many popular-sounding items, on the other hand, can be slightly below the menu’s average quality. For instance, you should be careful not to get too enthusiastic about roast chicken, especially if you are in a restaurant that, like virtually all restaurants, does not specialize in roast chicken. Roast chicken is an exceedingly familiar dish, and many people will order it to experience the familiar. Consider the incentive this provides the chef. And consider that a few items may be on the menu specifically because they are generally in demand, not because the chef cooks them with special brilliance.

So order the ugly and order the unknown. You’ll probably get a better and more interesting meal."

We go out to "fancy" restaurants less than we did a couple years ago because our financial constraints and aspirations have change, but I've long followed a rule somewhat similar to this. I've always hated the idea of ordering (saltwater) seafood more than about an hour or two from the coast or in our case the bay. There's a sign for a crab shack on Rt. 29 that we pass way out near the mountains and it always sends chills down my spine. It's not even really a freshness point. You can get fresh seafood out there. It's largely a culture thing (do they really know how to cook this?) and as Tyler says - a familiarity thing (are they just putting this on the menu because htey know people like crab cakes?). Crab cakes are actually one of those things - like the chicken he mentions - that I rarely order at restaurants anyway, even though I love them. And it's for exactly the same reason - everyone likes them and orders them for their familiarity and so they're not always made well. We make them at home a lot too, so we have a pretty good idea of what we like in a crab cake. There are a few places I like to get it: The Backfin in Williamsburg and Phillips always has good crab cakes. But usually I don't order it when we're out. When we are near the coast, I usually order the seafood. When we are futher west, I usually order a pork dish.

He says order Vietnamese instead of Thai... that's interesting. I haven't made that transition yet, but I do know what he means about the diluted quality of Thai food. We only have it from one or two places. He also says have Pakistani instead of Indian. Whereas I've had some Vietnamese food I've never had Pakistani food. But again - I know what he means. We've had so many Indian duds that while we get it fairly often we only get it from one places (and - not surprisingly - it's a hole in the wall that isn't downtown).

One thing I need to get over with food is that when I'm less familiar with a cuisine I don't experiment. At American restaurants (sandwich places, burger places, BBQ, seafood places), which unfortunately Cowen doesn't talk about nearly as much as ethnic restaurants, I'll order lots of different things even if I'm attached to a particular item at a particular place. I think a part of this is because I know the distribution of American food, I know what it's supposed to taste like and I know what I like in a particular American food, so I'm interested in seeing where they fall on that spectrum and how they experiment. At an ethnic place - particularly one I'm not familiar with - I stick with what works too often. Indian is by far the worst for me. I get pretty much the same thing every time (to be fair, we've gone to some pretty bad Indian places, so I feel like it's just self-preservation).

Email sent to Tim Groseclose

Subject: Question about "Left Turn" Methodology

Hi Tim -
I haven't read your book yet, but I was made aware of it yesterday through David Henderson's review in Regulation magazine. So my understanding of what you were doing is based on that and a review of your QJE article on the slant quotient.

I had a question about your approach that I just couldn't figure out and I was hoping you could explain it to me. Given that it's the media's job to report facts impartially, and given what we know about how politicians present facts to win votes and funding, why are you judging the bias of the media using the standard of the ideological composition of politicians? That seems backwards to me, so I'm wondering if I've missed something. One would think - when observing a difference between media views and politician views - that it's probably indicative that politicians are biased. I would have thought the title of your book should be "Right Turn".

Now of course this approach isn't perfect either. It's likely that both are biased to a certain extent, and therefore it's impossible to pin down exactly who is biased in which direction. But even in that case, I'm not sure how you can confidently claim that the media has a liberal bias.

Perhaps I should put it this way: how would you arbitrate between the claim (1.) politicians have a conservative/libertarian bias and (2.) the media has a liberal bias. You might address this in the book (and I plan on picking it up and reading it once I'm out of classes this summer). But at the moment I'm not sure why you opt for (2.) instead of (1.).

Thanks
Daniel Kuehn

*****

If I had to arbitrate between the two, I'd do two things. First, I'd focus on cases where there was a clear "right" answer - or at least a strong consensus - so that my measure of bias is nailed down better.

Second, I'd talk a lot about incentives and public choice type issues - and make a theoretical argument for why it makes more sense to say "politicians have a conservative/libertarian bias" than it does to say "the media has a liberal bias". Both may be a little true (or maybe the truth is so far left that both the media and politicians have a conservative/libertarian bias). But that would help to get at it. It's like Bryan Caplan's point about voters. When there's a difference in opinion between the experts and the general public, you probably don't want to argue that the experts are biased because they don't conform to the general public. I would probably choose to avoid the assertions about rationality or irrationality about why the two populations diverge.

I don't think that means what you think it means

"That" being the term "media bias".

I have a lot of comments on an interesting post by David Henderson on "media bias" and a new book on the subject by Tim Groseclose. It was similar in a lot of ways to my interest in his earlier article with Gochenour on presidential greatness: great subject discussed by a guy I consider both sharp and fair, but a deeply problematic argument.

The problem with Henderson and Groseclose's discussion of "media bias" (aside from a few bad variable choices - see my comments on that) is that the case boils down to something like "the media is biased because it is more liberal than the average American and a lot more liberal than me". If this is how we're talking about "bias" now, we're in trouble. I don't know where this view comes from that it's the media that's biased if it doesn't reflect the population. Maybe the population is biased. We are too willing to use the term "unbiased" to mean that both sides of the debate get equal air time. It's hogwash. Of course truth can be contested - most definitely. And as a guy that leans toward pragmatist explanations of these things I'm more than willing to say that. But the fact that truth is contested does not mean that truth is the average of what the population thinks about something. Truth is contested because of our observational, analytical, and computational frailties - not because truth is a mirror of all of our views.

What's most amazing to me is that Henderson and Groseclose use the distribution of the political views of Congress as the yardstick to judge the bias of the media. That seems almost exactly backward to me. Why don't we instead say "the media's job is to report the facts - they are obviously not perfect at it, but since they are the fact-reporters perhaps we should judge the bias of Congress by their conformity to the media". If Groseclose and Henderson took that approach, instead of concluding that the media has a liberal bias because they don't reproduce the political pathologies of the Congress, they would have concluded that Congress has a conservative/libertarian bias.

I didn't plan on sharing my thoughts on Henderson's review here, but this post by Krugman inspired me to. It's a great example of a case where there's a real divergence between media positions and political positions, but I think it's fair to say that it's the politicians that are biased - not the media - and if you judge the media by their conformity to the political discourse you get exactly the opposite answer that you should get (if you're concerned about bias).

So what's the source of this argument? Confirmation bias? Would Groseclose and Henderson be arguing these positions if it cut the other way? Would I?

Smith on Inflation Expectations

One of the risks of typing your homework late at night is that the ease of writing it up lets you slip into editorializing. I did this some last night (after solving the problem of course) complaining about a Barro-Gordon model exercise we did about central bank inflation bias. I think the argument makes very little sense. You basically only get the inflation bias result by assuming the central banker understands all sorts of things about the macroeconomy, but somehow doesn't understand how inflation expectations are formed (I'll give you a hint for inflation expectations in this particular case: they take the expected value of inflation! Real tough, huh? Clearly a central banker can't figure that one out). When you assume a dumbass central banker you get a dumbass policy. That seems dumb to me.

So it was nice this morning to see Karl Smith provide a dose of reality on inflation expectations modeling too - this time, thinking about what agents in the economy know about central bank behavior. He writes:

"My understanding is that the principle fear regarding inflation is that if a sustained period of high inflation were allowed expectations would become unmoored and the Fed would loose it hard won credibility.

The problem with this view is that it flies in the face of the notion that inflation expectations are rational.

A rational agent, however, incorporates knowledge not only of Fed behavior but of the informational and operational constraints facing the Fed. If it is in fact the case that the Fed is only risking higher inflation because it is

- Uncertain about potential output
- Concerned about hysterias
- Has difficulty adjusting policy at the zero lower bound
- Is operating in the wake of a major international financial crisis

Then a rational agent should not conclude that long run inflation targets have meaningfully changed."

Again - if you assume a dumbass agent you get dumbass agent behavior. We really should make sure our claims pass the smell test. Making simplifying abstractions is just fine. I'm hardly a praxeologist, as you all know. But you need to ask yourself if the only reason you're getting the result you're getting is because of an unrealistic assumption. If that's the case, then you've got a problem.

OK... now I need to reread my homework and make sure I didn't put it quite as bluntly as that.

Brad DeLong appears to be blogging an extended essay of some sort...

...start here and keep reading.

There's an interesting connection between E.M. Forster (a Bloomsbury member) and Henry Thornton. Lot's of other good stuff too.

A quick appeal on power analysis

So the stata commands that put in sample sizes, group means, and standard deviation to get out power are straightforward. Likewise, puting in power, group means, and standard deviations, and getting out sample size are straightforward.

It seems like it should be trivial to put in power and sample size and maybe a baseline group mean and get out a minimum detectable effect.... but stata doesn't seem to be able to do this with anything I've been able to put my hands on. If I had more time I'd do it by hand but I don't trust myself to do that right.

Anyone familiar with power analysis to get minimum detectable effects - preferably in stata, although possibly elsewhere?

A note on Cafe Hayek and civility in the economics blogosphere

So Don has a new book coming out collecting his letters to the editors. It's called "Hypocrites and Half-Wits: A Daily Dose of Sanity from Cafe Hayek". I know people don't always pick their titles, but the point still remains that he could have protested that one (if it wasn't his) - he doesn't seem to have. As anyone that knows about Don is aware, Paul Krugman's columns are a regular target of his letters, so presumably Krugman is a major player in the field of hypocrites and half-wits. Certainly lots of people that disagree with Don are.

This is the guy that complains about people like DeLong and Krugman being mean-spirited hacks, ideological, and ill-mannered. This is the guy that few if any libertarian economists have come out and said "gee Don, I really don't think that's a nice thing for you to say about X, Y, and Z".

This is exactly why I think 99.763% of complaints about Krugman and DeLong are total B.S. and not worth worrying about. Can you imagine the uproar in the libertarian blogosphere if either of those guys published a collection of screeds against people they disagreed with, titling it "Hypocrites and Half-Wits"? If we had a situation where anyone out there actually showed any sign of being even-handed about blogging etiquette, maybe we could talk. But we don't, and it's ridiculous to pretend that we do. So what I do is just pay attention to the people I think are nice and worth paying attention to (and there are LOTS of bloggers I disagree with that I think are nice and worth paying atention to), and ignoring the rest to the best of your ability.

While we're talking about forthcoming books from economics bloggers, I'd remind people that Krugman's new book on the Great Recession is coming out soon too.

UPDATE: This does have consequences for public education and communication, of course. A book called "The Conscience of a Liberal" is going to get very different results compared to a book called "Hypocrites and Half-Wits". Cause people do judge a book by its cover. The former says "I have my own perspective and I think it carries ethical weight, and here's why". The latter says "if you don't agree with me you're a dumbass or worse".

Gene Callahan just helped the security state pass the cost-benefit test

I'd be very curious of David Henderson's position on this. It's actually not a bad idea, and given the shocking degree to which people embrace the lottery, it may even amount to a good idea.

That would address many complaints. But the cost-benefit issues are only one side of airport security. It's also gotta be assessed as a security policy, and that's something I can't personally speak to.

Assault of Thoughts - 4/11/2012

"Words ought to be a little wild, for they are the assault of thoughts on the unthinking" - JMK

- Noahpinion on the new Wieland paper, and when it makes sense to use structural or non-structural models ("ad hoc" always seemed a little harsh to me... they're not ad hoc, they're just not structural! It's not like you just write up a non-structural model on a whim or something!). He distinguishes between two uses of models: forecasting and policy analysis. For forecasting, "all of the above" strategies are fine. For policy analysis, you want structural models. I think this is basically right. However, there's a third thing that we want to get out of economic models that is actually the most important reason for me: explaining the economy. Not predicting its future path. Not advising policymakers. But simply understanding how it works. And for that, I think both non-structural and structural models are useful. Since explanation is preferably causal rather than just descriptive, we don't want to ignore the microfoundations.

- The IMF says that we should look to the 1930s for housing policy. As Keynes might say, appeasing the rentier will not get us out of the slump. I'm interested in Andrew Bossie's thoughts on this.

- Speaking of Keynes, Jared Bernstein discusses George Bush the Keynesian. Now I kind of miss the guy. Maybe we should have had Gore 2000-2004 to keep us out of Iraq as we prosecuted the war on terror, Bush 2004-2012 to ignore the deficit when it actually made sense to ignore the deficit, and Obama 2012-2020, to swoop in and fix health care and entitlements.

- More Keynes: Jonathan on Chapter 3 of the General Theory. Haven't gotten a chance to read closely yet, but you should not make the same mistake.

- I am trying to pull together a power analysis for our Sloan Foundation proposal, at their request. I know generally what these entail, but it's not something that economists generally use - usually it's used by people with smaller scale experiments in fields like psychology. Although just out of curiosity I've picked the brains of a friend (who just finished a psych PhD) and my sister-in-law (who is in the midst of a psych PhD) about it, and neither of them are big fans of the approach. But you do what the funders ask you to do (so long as it isn't blatantly wrong, of course). Anyway - because economists don't generally use these methods, I wanted to share what I found out about power analysis in stata in case any of you are interested. The UCLA site has two commands of interest: powerreg and sampsi. You can import both by typing "findit powerreg" and "findit sampsi". Powerreg does a power analysis for regressions and sampsi does it for difference of means tests. I didn't even know you could do power analysis for regressions, and it's a little screwy - you ultimately get out the improvement in R-squared that you can detect with a given sample size and power level... but who thinks about regressions in this way? I would have thought you'd be most interested in the change in coefficient that you'd be able to detect with a given sample size and power level. So I think I may stick with the more traditional difference in means to satisfy Sloan's curiosity. But stata can do both if you ever have a need for it.