Street kids and the internet

In the 1990s, street youth shelters began offering free computer access, and a number of Web sites either created by street kids or catering to them quickly appeared... On digihitch.com, a portal claiming five thousand members, a query about New Orleans can run to pages of answers from street kids, complete with tips on how to find good squat (ask in Jackson Square), the rules of the street (don't panhandle your first day), and how the police react to street kids (be careful "flying a sign," or using a cardboard sign to beg). A post on hippy.com about Venice Beach includes the local menus (a church that gets donated pastries from Starbucks, a cafe that delivers hot soup and cookies to the street youths)....

More great stuff from All God's Children.

"It's not you, it's me"

I think an economist is forced to both agree and disagree with this standard breakup line.

The false part (that everyone knows is false) is the "it's not you" part. Clearly rejection is less likely if one is more attractive (in whichever way you like to define it), all else equal.

That said, the "it's me" part is true! One only breaks up with their partner if they believe their outside options are more attractive than sticking together. Ones outside options are a function of their own qualities. Thus, one can be rejected because their partner has really good alternatives (opportunity costs). This implies that rejection need not lead one to change how they feel about themself.

This analogy translates to all sorts of rejection. And this is not a bad outlook to have. It's better than thinking "the line" is completely false, anyways.

In which competition fails to lower prices?

"In Portland, the first major street family came into being in 1998 with the Nihilistic Gutter Punks....The NGP family soon claimed between seventy and a hundred members. The family grew too large to squat together, and smaller families began to splinter off the main group....As the youths split into smaller factions, the families developed increasingly severe initiation rites. New members of the Sick Boys were beaten into the family and, at times, were told to inject eighty units (a large syringe) of methamphetamine into the neck, a shot that is now known as a Sick Boy. The female members of the Sick Boys were called Sick Bitches, and they had to commit assaults and robberies in order to earn the right to wear "Bitch Bangs," or the short fringe of hair that female street youths sometimes keep when they shave the rest of their hair off. If they wanted to tie objects in their Bitch Bangs, the Sick Bitches had to commit more assaults. The harsher the initiations, the more the street kids clamored to join...."

This excerpt (with emphasis added) is from the very interesting and well-written All God's Children (which is currently 80% off at amazon.)

The first bolded sentence is interesting. Thinking about the street families as suppliers in a service industry trying to attract customers (kids) we would expect increased competition to make prices (initiation) fall. But the opposite happened. Now, it's obvious that the suppliers would want to increase their price but it's harder to explain how they could get away with it. Why wouldn't a no cost family spring up and attract all the kids who have yet to join a family?

I can think of two explanations that I think are plausible. One, street families are an example of a mythical (?) giffen good in which demand increases in price. This is the position the author takes in the second bolded sentence. I don't really buy it. I think correlation is being mistaken for causation. Demand for street families was already booming. That kids continued to join after the initiations became more severe does not mean that the harsher initiations caused demand to increase. That said, it's plausible since street families are clearly about status. Nevertheless, I think another explanation is more likely. That is, despite the increase in the number of firms (the splintering of the street families), market power of the suppliers was actually increasing due to increasing demand.

Both of these hypothesis seem testable with the right data. Perhaps the world needs an economics of street families to accompany the economics of drug-running gangs? Interestingly enough, one of the experts on street families, Bill McCarthy, is here at Davis in the sociology department. Perhaps I'll have an opportunity to ask his opinion at some point.

This is not the first time this month I've thought sociologists may hold the answers.

EDIT: A Rambling Grad Student has thoughts on this puzzle.

My favorite quote

For land that’s dry and unfruitful will give you good crops, if you put enough manure…I mean, your grace’s words have been like manure spread on the barren ground of my dry and uncultivated mind.

Oh how I wish I could take a week off to reread this book. It's been too long and the details have faded. Yet the memory of my emotional response remains clear as day.

The determinants of fanatical product support

A rambling grad student offers a few reasons why such things as trucks, operating systems, and video game systems develop fanatical product support while other things such as couches do not. He lists 5 candidate explanations:

1. Price: The big ticket items are more likely to develop fanaticism - works for trucks and electronics, but furniture costs a lot, too . . . why does no one even claim LaZBoy roks and Pottery Barn sux?
2. Social visibility: Maybe people are more likely to be fanatical with high profile visible goods - but that kind of fails when it comes to computers and video game systems.
3. The people that buy them: Maybe people that consume these particular goods are just the kind of folk that feel the need to identify themselves with one side or the other (or at least the type that are willing to broadcast their product choice and publicly berate all other choices)
4. Longevity: Maybe the longer timeframe investments warrant more fanaticism to justify purchase . . . but the cycle time on electronics is far too short for that rational.
5. Amount of user interaction: Electronics and trucks both have high user interaction time. Maybe items with a lot of product/user interaction require greater mental justification, and thus support higher amounts of fanaticism.

#5 is by far the most interesting and clever hypothesis.

Nevertheless, I think the answer is a twist on #1. That is, fanatical product support is driven by price relative to income. I imagine that those who are fanatical about trucks first purchased their truck when its cost was a large share of their income. More generally, it's probably stronger for people with low income. The same for videogame systems and computers--it develops for young folks with little disposable income. This also explains why no one cares about couch brand names. When it comes time to buy a couch, it tends to be a drop in the bucket.

I'm sure you have many personal counterexamples to this explanation. I also know plenty of folks who are well-off yet fanatical product supporters. This is easily explained by a gravity-type model. Once a bunch of people have sorted into their respective camps, there is pressure for others to join rather than to remain agnostic.

Should I be writing shorter sentences?

This post about writer's sentence length and sales has been making its way around a few of the blogs I read. Highly recommended. The conclusion (based on a rather small sample) is that shorter sentences sell more books.

Since I've been in the writing process of paper writing lately, I wondered if I shouldn't be writing shorter sentences. Of course, writing for economic journals is different from popular writing. At the same time, the same principles might apply. A quick google search turned up this paper by Laband and Taylor. They look at the impact of a number of quality measures, including words per sentence, on subsequent citations for a sample of articles from The Journal of Political Economy and The Review of Economics and Statistics. They found almost nothing. The one characteristic that matters is paper length--longer papers are cited more. You might think that, even if it doesn't matter within journals, writing characteristics may make a difference to what journal a paper gets published in. The linked paper cites another paper by Laband who looks at submissions to JPE and finds no effect. Still, it might matter at other journals and the sample is small and from over 20 years ago. Nevertheless, I'm inclined to believe the results until something better comes along. And it's too bad--I prefer (to write and read) short papers.

What I've been up to lately...

Working. That's just about it. Hooray for grad school! Things are particularly crazy right now because I'm pushing to finish a paper. Starting is easy. Finishing is hard.

Despite a sometimes heavy workload, the flexibility of academic life is undeniably sweet. I'm taking a trip to Chicago in a few weeks. It'll be my first time there. What should I do? I was thinking about forgetting all the sights and stalking Gary Becker. Don't they say that's the sincerest form of flattery? Seriously, though, all the work has kept me from looking into things to do while we're there. Any suggestions?

In Transition

As you probably notice, I've decided to make this an anonymous blog. I enjoy the blog for what it is--a scrapbook for ideas and experiences. I've long worried that the informal nature of the blog might make me appear less serious as an economist. When the question why should good economists blog requires an answer, it's a signal that it's a risky venture.

In general, I'm a very cautious person. Further, when it comes time to get a job, I'd like potential job market committees to focus their attention on the body of work that I've put years of work into. And I think they would like that as well. That said, putting myself in their shoes, it would be tough to resist looking at an applicant's blog that turned up from a google search.

Post-talk thoughts

Today I presented my work for the first time since my oral exam in June in our department brownbag series. Surprisingly, I was more nervous for this one than my oral exam. Probably because I feel like the paper is now close to being finished. More specifically, I've been working on it for long enough that I've done most of what I can think to do--this means I can rarely respond to questions with "I haven't gotten to that yet."

Despite my nerves, the presentation went really well. I got a lot of positive feedback and a lot of suggestions that I think will improve my paper a great deal. That said, I thought I would feel a great relief after it was over but I don't. I still feel the same anxiety since all the good suggestions mean I still have a lot of work to do. But I'm excited to dive back in. I hope to have a draft ready to "go public" soon.

Crazy fan, crazier goalkeeper

This clip has been showing up on all the soccer blogs lately:



So, why did he fake the injury? Well, some would argue that it's natural to soccer players. But the situation is a bit different when it involves a fan. He was probably hoping that the home team would be forced to forfeit due their fan's behavior.

Should schools teach kids how to talk?

Lately I've been reading selected articles from The New Education Reader: Leading Educators Speak Out. One of the articles pointed something out that is completely obvious that I have never thought of. Phonics is less likely to be effective for children who don't speak "properly" since they may not associate the "right" sound with letters.

This may explain why some kids have trouble learning to read. Especially kids from disadvantaged backgrounds. Also, this suggests that kids must be taught how to speak "properly" to teach phonics. I wonder if people are comfortable with this.

(You might argue that, more generally, teaching reading necessitates teaching how to speak properly but I don't think this is the case. Not in the sense that reading is word recognition anyways.)

Why aren't prostitutes paid like stadium vendors?

Tonight I watched a documentary called American Pimp. It was fairly interesting although it was difficult to watch the pimps talk so easily about manipulating women. I think I was made most uncomfortable by the fact that I sometimes felt that they were kind of charming. (That was an awkward sentence. Unintentional symbolism? Yup, that's it.)

Anyways, the most interesting thing I learned was the percentage that prostitutes get of their revenue. Zilch. (I'm not sure how exactly they're paid but that much was clear.) This seems like a bad business plan since it gives little incentive to the women to generate additional revenue. That is, in theory the pimps could make more money by giving the prostitutes a cut so that they work harder. Stadium vendors, for example, get paid based on how much they sell. What is different about prostitution so that this business model doesn't apply?

Perhaps the answer is that it's not different and the industry is due for a shake-up from an economics savvy pimp. But street prostitution has been around so long that I doubt a flawed strategy has persisted. Especially when the alternative is so obvious. Thus, I do think it's correct to ask why the commision-based model doesn't apply.

I'm tempted to relate the situation to the one described by Levitt and Venkatesh of crack dealers working for peanuts in hopes that they can work their way up the organization. But there is no up for these women. Or perhaps "up" is an occasional night out with their pimp. (Okay, I'm getting more depressed now.)

Alternatively, pimps may not need to offer a carrot (percentage of revenue) if their sticks (psychological and physical punishment) are effective enough to get their prostitutes to work as hard as they can. I think this is more likely the case. The pimps can easily monitor their prostitutes effort and punish them if they don't seem to be working hard. Both the cost of monitoring and the cost of punishing are probably low. Monitoring is cheap since the pimps don't have much else to do and the cost of punishing is cheap since the women lack other options. (Well, they could go to another pimp but I wouldn't rule out oligopoly behavior amongst the pimps as far as this is concerned.)

Turning the question around, why aren't stadium vendors paid like prostitutes? I think it's likely that monitoring and punishment are relatively expensive. (And, obviously, punishment is limited.) So, anyone have the data to test this hypothesis? (Perhaps a better question is: what data would you need to test this hypothesis?)

Riding the Wave

One of the reasons I started this blog was to help me stay current/connected to the outside world. Of course, this is a relative statement because "the outside world" might mean world of economics outside of the specific papers I'm working on as much as it means the outside world outside world. In any case, I think it's been helpful for both. And it has helped me generate a few research ideas I may pursue in the future.

At the same time, it's my nature to be a very streaky person and lately I've been focusing my energy rather exclusively on writing up a paper. I've learned to embrace my streakiness. When a wave of energy/focus/enthusiasm comes along, I go with it as long as I can. This includes activities like cooking and reading along with the academic stuff. Pacing oneself is overrated--doing less today probably will not make one do any more tomorrow.

As for the paper, I'm eager to finish it and I think I'm fairly close. I started working on it a little less than two years ago. The process has been a roller coaster. I've wanted to burst into my advisors office with the latest exciting results many times. I've wanted to throw my computer out the window many more times. That said, I'm happy with how it's shaping up. And I'm pretty sure my next/other papers will go more smoothly and more quickly with this one under my belt. (Why? First of all, mean reversion. Second, this is the first paper I started.)

Anyhow, I guess this is to say that the recent post drought is likely to continue for awhile. Then again, perhaps this post signals a blogging streak.