Another outstanding (and tragic) economics story from This American Life

"A car plant in Fremont California that might have saved the U.S. car industry. In 1984, General Motors and Toyota opened NUMMI as a joint venture. Toyota showed GM the secrets of its production system: how it made cars of much higher quality and much lower cost than GM achieved. Frank Langfitt explains why GM didn't learn the lessons – until it was too late."

Currently available for a free download.

Let's talk about sex

More cool stuff from the New York Times' best science writer (not that the others have set the bar that high)

The real thing

Jaime Escalante dies at 79; math teacher who challenged East L.A. students to 'Stand and Deliver'

Jaime Escalante, the charismatic former East Los Angeles high school teacher who taught the nation that inner-city students could master subjects as demanding as calculus, died Tuesday. He was 79.

Today's pointer

I am on the road (trasporting 3 pets solo -- don't ask) so blooging is very light.

But John D Cook brought up an interesting point today that should not be missed. It's a grey area but it is worth being very careful about just how much effort there is involved trying to improve medical care and how many barriers need to be crossed.

It's a difficult balance!

Hey, I used to work there

The Decline of the Middle (Creative) Class

I suggested in an earlier post that the rise to dominance of the thriller had not been accompanied by a rise in quality and reputation. In this and the next post, I'll try to put some foundations under this claim.

Popular art is driven by markets and shifts in popular art can always be traced back, at least partly, to economic, social and technological developments as well as changes in popular taste. The emergence of genre fiction followed the rise of the popular magazine (check here for more). Jazz hit its stride as the population started moving to cities. Talking pictures replaced silents when the technology made them possible.

Crime fiction, like science fiction first appeared in response to demand from general interest magazines like the Strand then moved into genre specific magazines like Black Mask and a few years later, cheap paperbacks. The demand for short stories was so great that even a successful author like Fitzgerald saw them as a lucrative alternative to novels. There was money to be made and that money brought in a lot of new writers.

It seems strange to say it now but for much of the Twentieth Century, it was possible to make a middle class living as a writer of short fiction. It wasn't easy; you had to write well and type fast enough to melt the keys but a surprisingly large number of people managed to do it.

Nor were writers the only example of the new creative middle class. According to Rosy McHargue (reported by music historian Brad Kay) in 1925 there were two hundred thousand professional musicians in the United States. Some were just scraping by, but many were making a good living. (keep in mind that many restaurants, most clubs and all theaters had at least one musician on the payroll.) Likewise, the large number of newspapers and independent publishers meant lots of work for graphic artists.

I don't want to wax too nostalgic for this era. Sturgeon's Law held firmly in place: 95% of what was published was crap. But it was the market for crap that made the system work. It provided the freelance equivalent of paid training -- writers could start at least partially supporting themselves while learning their craft, and it mitigated some of the risk of going into the profession -- even if you turned out not to be good enough you could still manage food and shelter while you were failing.

It was also a remarkably graduated system, one that rewarded quality while making room for the aforementioned crap. The better the stories the better the market and the higher the acceptance rate. In 1935, Robert E. Howard made over $2,000 strictly through magazine sales. Later, as the paperback market grew, writers at the very top like Ray Bradbury or John O'Hara would also see their stories collected in book form.

Starting with Gold Medal Books, paperback originals became a force in 1950. This did cut into the magazine market and hastened the demise of the pulps but it made it easier than ever before to become a novelist. It was more difficult (though still possible) to make a living simply by selling short stories, but easier to make the transition to longer and more lucrative works.

It was, in short, a beautifully functioning market with an almost ideal compensation system for a freelance based industry. It produced some exceptionally high quality products that have generated billions of dollars and continue to generate them in resales and adaptations (not to mention imitations and unlicensed remakes). This includes pretty much every piece of genre fiction you can think written before 1970.

The foundation of that system, the short story submarket, is essentially dead and the economics and business models of the rest of the publishing industry has changed radically leading to the rise of marketing, the blockbuster mentality and what I like to call the Slim Jim conundrum.

Tune in next time.

Now I'm going to spend the rest of the day wondering what a giant deodorant gun looks like

From the Guardian via TNR:

Beijing is to install 100 deodorant guns at a stinking landfill site on the edge of the city in a bid to dampen complaints about the capital's rubbish crisis. ...

Thrillers on Economics -- a quick digression

I've been working on a series of posts about the economics of crime novels (see here and here) and it got me thinking about economics in crime novels. I'm no expert but here's my incomplete survey.

George Goodman (a.k.a. "Adam Smith") once bemoaned the absence of business in American literature with the notable exception of John P. Marquand. With all due respect to the estimable Marquand (himself no stranger to the pulps), Goodman might have found what he was looking for if he had spent less time in high-end bookstores and more time in his corner drugstore looking at the books with the lurid covers.

Of the many crime novels built around businesses, the best might be Murder Must Advertise, a Lord Whimsey by Dorothy L. Sayers. The story is set in a London ad agency in the Thirties, a time when the traditional roles of the aristocracy were changing and "public school lads" were showing up in traditional bourgeois fields like advertising.

Sayers had been a highly successful copywriter (variations on some of her campaigns are still running today) and has sometimes been credited with coining the phrase "It pays to advertise." All this success did not soften her view of the industry, a view which is probably best captured by Whimsey's observation that truth in advertising is like yeast in bread.

But even if Sayers holds the record for individual event, the lifetime achievement award has got to go to the man whom many* consider the best American crime novelist, John D. MacDonald.

Before trying his hand at writing, MacDonald had earned an MBA at Harvard and over his forty year writing career, business and economics remained a prominent part of his fictional universe (one supporting character in the Travis McGee series was an economist who lived on a boat called the John Maynard Keynes). But it was in some of the non-series books that MacDonald's background moved to the foreground.

Real estate frequently figured in MacDonald's plots (not that surprising given given their Florida/Redneck Riviera settings). His last book, Barrier Island, was built around a plan to work federal regulations and creative accounting to turn a profit from the cancellation of a wildly overvalued project. In Condominium, sleazy developers dodge environmental regulations and building codes (which turned out to be a particularly bad idea in a hurricane-prone area).

Real estate also figures MacDonald's examination of televangelism, One More Sunday, as does almost every aspect of an Oral Roberts scale enterprise, HR, security, public relations, lobbying, broadcasting and most importantly fund-raising. It's a complete, realistic, insightful picture. You can find companies launched with less detailed business plans.

But MacDonald's best book on business may be A Key to the Suite, a brief and exceedingly bitter account of a management consultant deciding the future of various executives at a sales convention. Suite was published as a Gold Medal Original paperback in 1962. You could find a surprising amount of social commentary in those drugstore book racks, usually packaged with lots of cleavage.


* One example of many:

“To diggers a thousand years from now, the works of John D. MacDonald would be a treasure on the order of the tomb of Tutankhamen.” - KURT VONNEGUT

All Cretans are ad execs

This ad reminded of the Liar's Paradox. Not exactly the same thing, but the juxtaposition of messages -- romanticized images of cars brainwash you into desiring hollow status symbols/look at the romanticized images of our cars -- certainly plays to the irony-impaired.

My best subject used to be recess

David Elkind has a good op-ed piece out today on the loss of unstructured playtime in many schools.

One consequence of these changes is the disappearance of what child-development experts call “the culture of childhood.” This culture, which is to be found all over the world, was best documented in its English-language form by the British folklorists Peter and Iona Opie in the 1950s. They cataloged the songs, riddles, jibes and incantations (“step on a crack, break your mother’s back”) that were passed on by oral tradition. Games like marbles, hopscotch and hide and seek date back hundreds of years. The children of each generation adapted these games to their own circumstances.

Yet this culture has disappeared almost overnight, and not just in America. For example, in the 1970s a Japanese photographer, Keiki Haginoya, undertook what was to be a lifelong project to compile a photo documentary of children’s play on the streets of Tokyo. He gave up the project in 1996, noting that the spontaneous play and laughter that once filled the city’s streets, alleys and vacant lots had utterly vanished.

For children in past eras, participating in the culture of childhood was a socializing process. They learned to settle their own quarrels, to make and break their own rules, and to respect the rights of others. They learned that friends could be mean as well as kind, and that life was not always fair.

I have some quibbles with the essay and strong objections to a couple of points but most of what Elkind has to say here is valid and important.

The fundamental assumption of all educational debates needs to be that children are naturally curious and creative, that evolution has programmed them to learn and explore. Strategies that do a good job capitalizing on that curiosity and creativity will be successful and sometimes the best way to do that is to simply get out of the kids' way.

Another reminder that improbable events are probable

From Jonathan Chait:

Brian Kalt, a law professor and former college classmate of mine, has developed his own law of presidential facial hair:

I thought you might be interested in the following ironclad law of American presidential politics. I call it Kalt’s Law: “Under the modern two-party system, if a candidate has facial hair, the Republican always has as much, or more, than the Democrat.”

Excellent primer on the economics of genre fiction.

In the introduction to Science Fiction by Gaslight, Sam Moskowitz does a really good job explaining how changes in publishing led to the creation of most of today's popular fiction genres. It's an interesting book if you can find a copy.

I'll try to tie this in with the thriller thread (see here and here) in an upcoming post.

Advice from Andrew Gelman

Whom I always defer to on non-literary matters:

They also recommend composite end points (see page 418 of the above-linked article), which is a point that Jennifer and I emphasize in chapter 4 of our book and which comes up all the time, over and over in my applied research and consulting. If I had to come up with one statistical tip that would be most useful to you--that is, good advice that's easy to apply and which you might not already know--it would be to use transformations. Log, square-root, etc.--yes, all that, but more! I'm talking about transforming a continuous variable into several discrete variables (to model nonlinear patterns such as voting by age) and combining several discrete variables to make something continuous (those "total scores" that we all love). And not doing dumb transformations such as the use of a threshold to break up a perfectly useful continuous variable into something binary. I don't care if the threshold is "clinically relevant" or whatever--just don't do it. If you gotta discretize, for Christ's sake break the variable into 3 categories.

This all seems quite obvious but people don't know about it. What gives? I have a theory, which goes like this. People are trained to run regressions "out of the box," not touching their data at all. Why? For two reasons:

1. Touching your data before analysis seems like cheating. If you do your analysis blind (perhaps not even hanging your variable names or converting them from ALL CAPS), then you can't cheat.

2. In classical (non-Bayesian) statistics, linear transformations on the predictors have no effect on inferences for linear regression or generalized linear models. When you're learning applied statistics from a classical perspective, transformations tend to get downplayed, and they are considered as little more than tricks to approximate a normal error term (and the error term, as we discuss in our book, is generally the least important part of a model).Once you take a Bayesian approach, however, and think of your coefficients as not being mathematical abstractions but actually having some meaning, you move naturally into model building and transformations.

I don't know if I entirely buy point 2. I'm generally a frequentist and I make extensive use of transformations (though none of them are linear transformations).

Fighting words from Andrew Gelman

Or at least a fighting summary of someone else's...

[I've got a meeting coming up so this will have to be quick and ugly and leave lots of plot threads dangling for the sequel]

From Andrew's reaction to Triumph of the Thriller by Patrick Anderson:

Anderson doesn't really offer any systematic thoughts on all this, beyond suggesting that a higher quality of talent goes into thriller writing than before. He writes that, 50 or 70 years ago, if you were an ambitious young writer, you might want to write like Hemingway or Fitzgerald or Salinger (if you sought literary greatness with the possibility of bestsellerdom too) or like James Michener, or Herman Wouk (if you sought fame and fortune with the possibility of some depth as well) or like Harold Robbins or Irving Wallace (if you wanted to make a business out of your writing). But the topselling authors of mysteries were really another world entirely--even though their books were ubiquitous in drugstore and bus-station bookracks, and even occasionally made their way onto the bestseller lists, they barely overlapped with serious fiction, or with bestselling commercial fiction.

Nowadays, though, a young writer seeking fame and fortune (or, at least, a level of financial security allowing him to write and publish what he wants) might be drawn to the thriller, Anderson argues, for its literary as well as commercial potential. At the very least, why aim to be a modern-day Robbins or Michener if instead you can follow the footsteps of Scott Turow. And not just as a crime novelist, but as a writer of series: "Today, a young novelist with my [Anderson's] journalistic knack for action and dialogue would be drawn to a crime series; if not, his publisher would push him in that direction."

1. I'd argue (and I think most literary historians would back me up) that in terms of literary quality, crime fiction was at its best from about the time Hammet started writing for Black Mask to either the Fifties or Sixties, a period that featured: Chandler; Ross and John D. MacDonald; Jim Thompson; Ed McBain; Donald Westlake; Joe Gores; Lawrence Block* and a slew of worthies currently being reprinted by Hard Case.

2. Crime writing was fairly respected at the time. Check out contemporary reviews (particularly by Dorothy Parker). It was even possible for Marquand to win a Pulitzer for a "serious" novel while writing the Mr. Moto books.

3. There is an economic explanation for both the drop in quality and the surge in sales, but that will have to wait. I have a meeting at one of the studios and I need to go buy a pair of sunglasses.

*Those last three did their best work more recently but they were a product of the pulps.

p.s. Here's an illustrative passage from the NYT on the literary respect a mystery writer might achieve back before thrillers were the dominant genre:

Ross Macdonald's appeal and importance extended beyond the mystery field. He was seen as an important California author, a novelist who evoked his region as tellingly as such mainstream writers as Nathanael West and Joan Didion. Before he died, Macdonald was given the Los Angeles Times's Robert Kirsch Award for a distinguished body of work about the West. Some critics ranked him among the best American novelists of his generation.

By any standard he was remarkable. His first books, patterned on Hammett and Chandler, were at once vivid chronicles of a postwar California and elaborate retellings of Greek and other classic myths. Gradually he swapped the hard-boiled trappings for more subjective themes: personal identity, the family secret, the family scapegoat, the childhood trauma; how men and women need and battle each other, how the buried past rises like a skeleton to confront the present. He brought the tragic drama of Freud and the psychology of Sophocles to detective stories, and his prose flashed with poetic imagery. By the time of his commercial breakthrough, some of Macdonald's concerns (the breakdown between generations, the fragility of moral and global ecologies) held special resonance for a country divided by an unpopular war and alarmed for the environment. His vision was strong enough to spill into real life, where a news story or a friend's revelation could prompt the comment "Just like a Ross Macdonald novel."

It was a vision with meaning for all sorts of readers. Macdonald got fan mail from soldiers, professors, teenagers, movie directors, ministers, housewives, poets. He was claimed as a colleague by good writers around the world, including Eudora Welty, Andrey Voznesensky, Elizabeth Bowen, Thomas Berger, Marshall McLuhan, Margaret Laurence, Osvaldo Soriano, Hugh Kenner, Nelson Algren, Donald Davie, and Reynolds Price.

Assumptions

We always talk about how hard it is to actually try and verify the assumptions required for missing data techniques to yield unbiased answers. Still, it really is a breath of fresh air when somebody tries to give some (data driven) guidance on whether or not an assumption really is reasonable. That was the case with a recent PDS article:

Marston L, Carpenter JR, Walters KR, Morris RW, Nazareth I, Petersen I. Issues in multiple imputation of missing data for large general practice clinical databases. Pharmacoepidemiol Drug Saf 2010 (currently an epub)

They nicely make the case that blood pressure data is likely to be missing at random in these databases. Given my thoughts that BP data is underused, this is actually a pretty major advance as it allows more confidence in inferences from these large clinical databases.

Good show, folks!