Undercover Economist

What really counts

The Undercover Economist – FT Magazine, 28 January 2006

An extended version of this article was published by Slate, 4 February.

My second-favourite character from Sesame Street was always The Count. Avid viewers will recall that The Count loves to count, punctuating his counting with a throaty Transylvanian chuckle. Laughing aside, I’ve noticed a similar tendency in economists. We spent decades perfecting the theoretical tools and the software to gather and analyse noisy data in a messy world. Most of the data were produced by laborious counting of the most obvious things: goods sold, prices, people out of work. Now the tools are so good and so simple to use, and data so easy to gather and disseminate, it’s hard to resist the temptation not to count, well, something different.

A nice exponent of this is Chicago-based economist David Galenson, who recently demonstrated that Picasso was by far the greatest artist of the 20th century. Galenson’s method is simplicity itself: round up every art history textbook of the past 15 years, and see whose art is reproduced most frequently. Picasso, with 395 illustrations in 33 textbooks, scores nearly as many as his three closest rivals (Matisse, Duchamp and Mondrian) put together.

Galenson is out on a limb with this particular piece of counting, but his work highlights the features of more mainstream counting projects. First, it’s infuriating. An economist pronounces Picasso the greatest artist of the 20th century on the basis of leafing through picture books: what could be more irritating?

Second, it’s also annoyingly reasonable. Galenson is not counting something stupid, like the number of colours Picasso used. He’s counting something meaningful, which is how frequently experts felt inclined – or compelled – to exhibit Picasso’s art in canonical textbooks. The process of counting is reductive but not foolishly so. It is a simple and transparent quantification of other people’s qualitative judgments.

Third, the counting is the start, not the end. What really interests Galenson is when artists reach their peak. His method allows him to show, for example, that the artists who made conceptual leaps (Johns, Picasso, Duchamp, Warhol) peaked far earlier than so-called “experimental” artists for whom practice made perfect (Kandinsky, Rothko, Mondrian). Johns was 25 when he produced his most-reproduced pieces. Mondrian was 71.

Galenson’s counting isn’t going to change the world, but other projects may. Former colleagues at the World Bank have been counting away: how many official signatures does a farmer in the Central African Republic need to obtain before he’s able to get his bananas on a ship bound for America or Europe – 38. How many official procedures must a businessman in Lagos go through in order to legally buy a warehouse – 21.

This kind of counting – done with the help of several thousand local lawyers and public officials – shares common ground with Galenson’s work. It transforms a qualitative impression (”Nigerian bureaucracy is painful”) into a quantitative fact; it does so through the intermediation of experts, and uses a perfectly transparent process.

It’s also rather more useful. Galenson won’t tell you how to be the next Picasso, but the World Bank report, Doing Business in 2006, can show Central African Republic officials which 37 of the 38 signatures are surplus to requirements in Germany.

Meanwhile, Doing Business in 2006 is, by far, the World Bank publication most mentioned in press reports. I know that, because somebody counted.