Tim Harford The Undercover Economist
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Undercover Economist

The case for ending Amazon’s dominance

It should not be difficult to love Amazon. To consumers, it offers choice and convenience. Countless internet ventures have relied on its cheap, flexible cloud computing services to start and scale up. Amazon makes titans such as Walmart work hard for their revenue, offers a shopping search engine that is Google’s only serious rival, raises the bar for television networks and sells tablet computers at a price to make Apple loyalists stop and think.

Amazon is also giving the US economy what it needs. Two economists, Germán Gutiérrez and Thomas Philippon, have argued that corporate America is underinvesting. One reason is that companies are impatiently funnelling cash to investors and executives rather than take a long-term view.

If that is a worrisome state of affairs — and it should be — then Amazon is the shining counterexample. The online retailer’s strategy is driven not by short-term profit but by investment, innovation and growth. If only there were a few more companies like Amazon, capitalism would be in a happier spot.

But there’s the rub: there aren’t more companies like it. It’s unique, and an increasingly terrifying force in online commerce. Should regulators act? If so, how? It’s worth first disposing of a bad argument: that Amazon must be challenged because it makes life miserable for its competitors, some of which are plucky mom-and-pop operations. However emotionally appealing this might seem, it should not be the business of regulators to prop up such businesses.

Regulators have a tendency to slip into the role of protecting incumbents with surprising ease. Marc Levinson’s history of container shipping, The Box (UK) (US), describes Malcom McLean — the entrepreneur behind containerisation, a risk-taking visionary reminiscent of Amazon’s founder Jeff Bezos. When McLean tried to expand his operations, one of his largest obstacles was the Interstate Commerce Commission in the US, which regulated US railways from 1887 and interstate trucking from 1935.

The ICC, writes Mr Levinson, had to approve each new route, every new commodity and any new price schedule. When McLean wanted to start a trucking route at a low price, he had to hire lawyers and argue his case at the ICC, while his competitors protested bitterly — “unfair and destructive”, said the railways. He did not always get his way.

Antitrust authorities should not be in the business of making life easy for incumbents. What, then, should they do? There are two schools of thought. One is to focus on consumers’ interest in quality, variety and price. This has been the standard approach in US antitrust policy for several decades. Since Amazon makes slim profits and charges low prices, it raises few antitrust questions.

The alternative view — which harks back to an earlier era of antitrust during which Standard Oil and later AT&T were broken up — argues that competition is inherently good even if it is hard to quantify a benefit to consumers and that society should be wary of large or dominant companies even if their behaviour seems benign. The collapse of companies from Lehman Brothers to construction services business Carillion reminds us that size can be a problem when a company is weak as well as when it is strong.

The narrowing in antitrust thinking is described by Lina Khan in a much-read article, “Amazon’s Antitrust Paradox”. Ms Khan berates modern antitrust thinking for its “hostility to false positives”, arguing that it has become incapable of saying anything insightful about modern tech companies.

Unlike Ms Khan, I share modern antitrust’s hostility to false positives; there is a real cost to cumbersome and unnecessary meddling in a dynamic and rapidly-evolving marketplace. Donald Trump’s history of publicly attacking Mr Bezos is worth pondering too: do we really want the US government to have more discretion as to who is targeted, and why? We should not wish to return to a world in which a plucky new competitor must beg regulators — over the objections of incumbents — for permission to cut prices. We should be grateful that Mr Bezos did not face in the 1990s the regulatory obstacles that Malcom McLean dodged in the 1950s.

Yet for all this, I am deeply uneasy about Amazon’s apparently unassailable position in online retail. Yes, customers are being well served at the moment. Yet the company has acquired formidable entrenched advantages, from the information about customers and the suppliers who sell through it, to the bargaining power it has over delivery companies, to the vast network of warehouses. Those advantages were earned, but they can also be abused.

Antitrust authorities face a difficult balancing act. Regulate Amazon and you may snuff out the innovation that we all say we want more of. Punish it for success and you send a strange message to entrepreneurs and investors. Ignore it and you risk leaving vital services in the hands of an invincible monopolist.

There are no easy options, but it is time to look for a way to split Amazon into two independent companies, each with the strength to grow and invest. If Amazon is such a wonderful company, wouldn’t two Amazons be even better?

 
Written for and first published in the Financial Times on 19 January 2018.

My recent book is “Fifty Inventions That Shaped The Modern Economy”. Grab yourself a copy in the US or in the UK (slightly different title) or through your local bookshop.

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Other Writing

Review of The Tyranny of Metrics by Jerry Muller

Jerry Z Muller’s latest book is 220 pages long, not including the front matter. The average chapter is 10.18 pages long and contains 17.76 endnotes. There are four cover endorsements and the book weighs 421 grammes. These numbers tell us nothing, of course. If you want to understand the strengths and weaknesses of The Tyranny of Metrics (UK) (US) you will need to read it — or trust the opinion of someone who has.

Professor Muller’s argument is that we keep forgetting this obvious point. Rather than rely on the informed judgment of people familiar with the situation, we gather meaningless numbers at great cost. We then use them to guide our actions, predictably causing unintended damage.

A famous example is the obsession, during the Vietnam war, with the “body count” metric embraced by US defence secretary Robert McNamara. The more of the enemy you kill, reasoned McNamara, the closer you are to winning. This was always a dubious idea, but the body count quickly became an informal metric for ranking units and handing out promotions, and was therefore often exaggerated. Counting bodies became a risky military objective in itself.

This episode symbolises the mindless, fruitless drive to count things. But it also shows us why metrics are so often used: McNamara was trying to understand and control a distant situation using the skills of a generalist, not a general. Muller shows that metrics are often used as a substitute for relevant experience, by managers with generic rather than specific expertise.

Muller does not claim that metrics are always useless, but that we expect too much from them as a tool of management. For example, if a group of doctors collect and analyse data on clinical outcomes, they are likely to learn something together. If bonuses and promotions are tied to the numbers, the exercise will teach nobody anything and may end up killing patients. Several studies have found evidence of cardiac surgeons refusing to operate on the sickest patients for fear of lowering their reported success rates.

It’s easy to sympathise with this argument, and I do. (I made some similar points in a chapter of my book Messy.) The Tyranny of Metrics does us a service in briskly pulling together parallel arguments from economics, management science, philosophy and psychology along with examples from education, policing, medicine, business and the military. It makes the case for professional autonomy: that metrics should be tools in the hands of teachers, doctors and soldiers rather than tools in the hands of those who would oversee them.

In an excellent final chapter, Muller summarises his argument thus: “measurement is not an alternative to judgement: measurement demands judgement: judgement about whether to measure, what to measure, how to evaluate the significance of what’s been measured, whether rewards and penalties will be attached to the results, and to whom to make the measurements available”.

This is a strong argument, but there are gaps in it. The book does not engage seriously enough with the possibility that the advantages of metric-driven accountability might outweigh the undoubted downsides. Tellingly, Muller complains of a university ratings metric that rewards high graduation rates, access for disadvantaged students, and low costs. He says these requirements are “mutually exclusive”, but they are not. They are in tension with each other, but a college that achieved all three goals would not be a triumph rather than a logical absurdity.

The risk of trusting the professionals is that a bad teacher or police officer might coast undetected; or that a coterie of insiders might promote their own protégées, excluding women or ethnic minorities. Data-gathering efforts promise to spot prejudice, incompetence, back-scratching and worse. Perhaps they are doomed to fail, but in a world where insiders have covered up for each other far too often, we should not dismiss them too quickly.

Nor does this book reckon with evidence that mechanical statistical predictions often beat the subjective judgment of experts. This was demonstrated by psychologist Paul Meehl in his 1954 book Clinical versus Statistical Prediction. Subsequent research has supported his claim, while campaigners for evidence-based medicine such as Archie Cochrane and Sir Iain Chalmers have made a strong case not simply to take expert medical opinion on trust. Overconfident experts have been humbled by statistical methods frequently enough for the phenomenon to have been worth a chapter.

Finally, and perhaps most curiously, there is no discussion of computers, cheap sensors, or big data. In this respect, at least, the book could have been written in the 1980s. It is a strange omission, especially since Muller would surely have much to say about big data and algorithmic management.

All this, however, is criticism from a position of admiration. Many of us have the vague sense that metrics are leading us astray, stripping away context, devaluing subtle human judgement, and rewarding those who know how to play the system. Muller’s book crisply explains where this fashion came from, why it can be so counterproductive and why we don’t learn. It should be required reading for any manager on the verge of making the Vietnam body count mistake all over again.
Written for and first published in the Financial Times on 24 January 2018.

My recent book is “Fifty Inventions That Shaped The Modern Economy”. Grab yourself a copy in the US or in the UK (slightly different title) or through your local bookshop.

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15th of February, 2018Other WritingComments off
Marginalia

The Logic of Failure

The most original book I read this week – after a recommendation from the always-worth-listening-to Cass Sunstein – was The Logic of Failure (UK) (US) by Dietrich Dorner. Dorner sets experimental subjects difficult simulation games (they all sound a little bit like Sim City to me) and observes as they try to master the games alone or in groups. Most of their actions have unintended consequences that are predictable in principle, but often confounding to the players. For example, if you eradicate the tsetse fly then the cattle will prosper, but as the cattle population booms, grass and water will be depleted. Drill more wells and you can get more water – until the entire water table is depleted. Then a famine looms; all foreseeable if only you can keep the whole system in mind and follow the chain of consequences.

Dorner studies the successful players, and the less successful, and looks for patterns – do they ask enough questions? Too many decisions? Too few? Do they blame others, become frustrated? Do they begin to obsess about trivia? While the methodology itself is clearly somewhat limited, it’s enormously thought-provoking.

(By the way, having been reminded of the book’s existence by Cass Sunstein, I should mention that his book with Reid Hastie, Wiser (UK) (US) is the best book I know about group decision-making and how to overcoming polarisation and groupthink.)

I’ve also been reading about military history. I re-read Norman Stone’s WWII: A Short History (UK) (US) which is astonishingly good. Bracingly brief and opinionated, but a remarkable way to gain perspective on what can easily become a bewildering mash of highly partial pieces of folk history.

Also – for a perspective on the brilliant but dreadfully flawed tank strategist J.F.C. Fuller – I read Mark Urban’s Generals (UK) (US) which I enjoyed, and suspect I’ll be back to in due course. There was plenty of useful and telling detail in one chapter than in an entire biography of Fuller I spent the morning reading in the Bodleian – Mark Urban is able to see the wood and the trees. Well done.

13th of February, 2018MarginaliaComments off
Undercover Economist

Lessons from history in how to spot a bubble

Here are three noteworthy pronouncements about bubbles.

“Prices have reached what looks like a permanently high plateau.” That was Professor Irving Fisher in 1929, prominently reported barely a week before the most brutal stock market crash of the 20th century. He was a rich man, and the greatest economist of the age. The great crash destroyed both his finances and his reputation.

“Those who sound the alarm of an approaching . . . crisis have somewhat exaggerated the danger.” That was a renowned commentator who shall remain nameless for now.

“We are currently showing signs of entering the blow-off or melt-up phase of this very long bull market.” That was investor Jeremy Grantham on January 3 this year. The normally bearish Mr Grantham mused that while shares seem expensive, historical precedents make it plausible that the S&P 500 will soar from present levels of around 2,700 to more than 3,500 before the crash occurs.

Mr Grantham’s speculation is striking because he has tended to be a savvy bubble watcher in the past. But as any toddler can attest, it is not an easy thing to catch one before it bursts.

There are two obvious ways to diagnose a bubble. One is to look at the fundamentals: if the price of an asset is unmoored from the cash flow it is likely to generate, that is a warning sign. (It is anyone’s guess what this implies for bitcoin, an asset that has no cash flow at all.)

The other approach is to look around: are people giddy with excitement? Can the media talk of little else? Are taxi drivers offering stock tips?

At the moment, however, these two approaches tell a different story about US stocks. They are expensive by most reasonable measures. But there are few other signs of speculative mania. The price rise has been steady, broad-based and was hardly the leading news of 2017. Given how expensive bonds are, it is hardly a surprise that stocks also seem pricey. No wonder investors and commentators are unsure what to say or do.

It seems all so much easier with hindsight: looking back, we can all enjoy a laugh at the Extraordinary Popular Delusions and the Madness of Crowds, to borrow the title of Charles Mackay’s famous 1841 book, which chuckles at the South Sea bubble and tulip mania. Yet even with hindsight things are not always clear. For example, I first became aware of the incipient dotcom bubble in the late 1990s, when a senior colleague told me that the upstart online bookseller Amazon.com was valued at more than every bookseller on the planet. A clearer instance of mania could scarcely be imagined.

But Amazon is worth much more today than at the height of the bubble, and comparing it with any number of booksellers now seems quaint. The dotcom bubble was mad and my colleague correctly diagnosed the lunacy, but he should still have bought and held Amazon stock.

Tales of the great tulip mania in 17th-century Holland seem clearer — most notoriously, the Semper Augustus bulb that sold for the price of an Amsterdam mansion. “The population, even to its lowest dregs, embarked in the tulip trade,” sneered Mackay more than 200 years later.

But the tale grows murkier still. The economist Peter Garber, author of Famous First Bubbles, points out that a rare tulip bulb could serve as the breeding stock for generations of valuable flowers; as its descendants became numerous, one would expect the price of individual bulbs to fall.

Some of the most spectacular prices seem to have been empty tavern wagers by almost-penniless braggarts, ignored by serious traders but much noticed by moralists. The idea that Holland was economically convulsed is hard to support: the historian Anne Goldgar, author of Tulipmania (US) (UK), has been unable to find anyone who actually went bankrupt as a result.

It is easy to laugh at the follies of the past, especially if they have been exaggerated for the purposes of sermonising or for comic effect. Charles Mackay copied and exaggerated the juiciest reports he could find in order to get his point across.

Then there is the matter of his own record as a financial guru. That comment, this time in full, “those who sound the alarm of an approaching railway crisis have somewhat exaggerated the danger”, was Mackay himself, writing in the Glasgow Argus in 1845, in full-throated support of the idea that the railway investment boom of the time would return a healthy profit to investors. It was, instead, a financial disaster. In the words of mathematician and bubble scholar Andrew Odlyzko, it was “by many measures the greatest technology mania in history, and its collapse was one of the greatest financial crashes”.

Oddly, Mackay barely mentions the railway mania in subsequent editions of his book — nor his own role as cheerleader. This is a lesson to us all. It’s very easy to scoff at past bubbles; it is not so easy to know how to react when one may — or may not — be surrounded by one.

Written for and first published in the Financial Times on 12 January 2018.

My recent book is “Fifty Inventions That Shaped The Modern Economy”. Grab yourself a copy in the US or in the UK (slightly different title) or through your local bookshop.

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Marginalia

Books about money, the mind, and the planet

A range of books passing across the desk at the moment! I’ve enjoyed Dan Ariely and Jeff Kreisler’s Small Change (US edition is Dollars and Sense) which is a mashup of all the best in behavioural economics research, whimsical chat and financial advice. Fans of Dan’s earlier work will find this rather familiar – especially if they’ve also read the very good Why Smart People Make Big Money Mistakes (UK) (US) by Belsky and Gilovich, which covers similar ground in a more sober style – but its a fun book with some wise advice.

I have also been revisiting On The Psychology of Military Incompetence (UK) (US) by Norman Dixon, a fascinating book, if one which looks strange to my modern eyes in some ways. Dixon is excellent in his account of military errors; his explanation is also excellent in some ways and odd in others. Too much about eg the impact of how generals might have been toilet trained as toddlers – but then I realised that this predates the modern behavioural literature on heuristics and biases. Still: thought-provoking!

Tim Jackson has sent me the second edition of his book Prosperity without Growth (UK) (US) with a note saying he wasn’t sure how much I’d agree with it. I’m not sure either, having not made the time to read it in depth, but I turned directly to the chapter on the “Myth of Decoupling” – a subject about which a lot of nonsense has been written – and was impressed with the balance and more importantly the attention to the evidence. I am more optimistic than Tim about decoupling, the idea that an economy can grow without ever-increasing energy and resource use – but can’t fault his chapter on the topic.

I’ve also received a copy of Earth at Risk (UK) (US) by Henry and Tubiana, which seems to be a chewier more academic exploration of “natural capital and the quest for sustainability”. Endorsement by Bill McKibben.

 

 
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6th of February, 2018MarginaliaComments off
Undercover Economist

Why Microsoft Office is a bigger productivity drain than Candy Crush Saga

A few weeks before Christmas, an impish chart appeared on the Bank of England’s unofficial blog. It compared plunging productivity with the soaring shipments of smartphones. Typical productivity growth in advanced economies had hovered steadily around 1 per cent a year for several decades, but has on average been negative since 2007. That was the year the iPhone started to ship.

Nobody really believes that the iPhone caused the productivity slowdown — a more obvious culprit would be the global financial crisis — but it is hard to find people who think that their phones are an unalloyed blessing. If in 1968 an economist or computer scientist had been told that 50 years later we would all be carrying wirelessly networked supercomputers in our pockets, he or she would have been staggered at the potential. I doubt they would have realised quite how much time we would spend liking Instagram posts, playing Pokémon Go and sending each other digital interruptions.

The costs of this distraction are starting to become apparent. I wrote recently about the research of Gloria Mark of the University of California, Irvine. Prof Mark argues that reorientating yourself after an interruption tends to take between 20 and 25 minutes. We all know how a moment’s inattention can turn into a clickhole of distractions. She also points out that once we get used to being interrupted by others, we start interrupting ourselves, twitchily checking email or social media in the hope something interesting might turn up.

Yet digital devices slow us down in subtler ways, too. Microsoft Office may be as much a drag on productivity as Candy Crush Saga. To see why, consider Adam Smith’s argument that economic progress was built on a foundation of the division of labour. His most celebrated example was a simple pin factory: “One man draws out the wire, another straights it, a third cuts it, a fourth points” and 10 men together made nearly 50,000 pins a day.

In another example — the making of a woollen coat — Smith emphasises that the division of labour allows us to use machines, even “that very simple machine, the shears with which the shepherd clips the wool”.

The shepherd has the perfect tool for a focused task. That tool needs countless other focused specialists: the bricklayer who built the foundry; the collier who mined fuel; the smith who forged the blades. It is a reinforcing spiral: the division of labour lets us build new machines, while machines work best when jobs have been divided into one small task after another.

The rise of the computer complicates this story. Computers can certainly continue the process of specialisation, parcelling out jobs into repetitive chunks, but fundamentally they are general purpose devices, and by running software such as Microsoft Office they are turning many of us into generalists.

In a modern office there are no specialist typists; we all need to be able to pick our way around a keyboard. PowerPoint has made amateur slide designers of everyone. Once a slide would be produced by a professional, because no one else had the necessary equipment or training. Now anyone can have a go — and they do.

Well-paid middle managers with no design skills take far too long to produce ugly slides that nobody wants to look at. They also file their own expenses, book their own travel and, for that matter, do their own shopping in the supermarket. On a bill-by-the-minute basis none of this makes sense.

Why do we behave like this? It is partly a matter of pride: since everyone has the tools to build a website or lay out a book, it feels a little feeble to hand the job over to a professional. And it is partly bad organisational design: sacking the administrative assistants and telling senior staff to do their own expenses can look, superficially, like a cost saving.

But it is also that some of these jobs are a pleasant diversion from the key task at hand. Even filling out expenses may be soothing to some, and designing your own PowerPoint presentation can be quite fun for the presenter, if not for the hapless audience.

Smith worried that repetitive work would make us “as stupid and ignorant as it is possible for a human creature to become”. That risk remains. Technology can unbundle tasks, leaving human workers with grimly narrow duties.

But for other workers, general-purpose computers push back against Smith’s concern. Design a pretty graph, search the internet for cartoons for a presentation, use a price-comparison site to book some travel, craft an eloquent post on LinkedIn, and office life starts to look mildly entertaining — even if there isn’t much time left to do the jobs for which we’re paid. Setting games and social media aside, there are plenty of ways for workers to use their computers to do their jobs less efficiently while having more fun, perhaps without even meaning to.

I suspect this is but a small part of the productivity slowdown. And I feel ambivalent about it. A day full of distractions is rarely satisfying. On the other hand, I would not wish to spend each hour sharpening 5,000 pins.

Written for and first published in the Financial Times on 5 January 2018.

My new book is “Fifty Inventions That Shaped The Modern Economy”. Grab yourself a copy in the US or in the UK (slightly different title) or through your local bookshop.

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Undercover Economist

The world in 2118 – my forecasts for the century ahead

It is the season for journalists to make their predictions for the year ahead. These forecasts are the mince pies of the intellectual world: tempting, enjoyable, but manifestly unhealthy. So let me attempt a loftier task — and one that is consequence free. I’d like to describe the economy not in the year 2018, but in the year 2118.

I’m not the first to attempt a hundred-year forecast. John Maynard Keynes did so in his 1930 essay, “Economic Possibilities for Our Grandchildren”, noting that on average we might expect to be eight times richer in 2030 than a century earlier. We will fall somewhat short of that, but not by much.

I’ll make a more conservative forecast: that we’ll be five times richer in 2118 than we are today. That would put global income at around $80,000 per person — roughly twice the current average salary in the UK today — and income in the leading economies will be more than $250,000 per person per year in today’s money.

This forecast omits and probably understates how much fun one might have with $250,000 in a century’s time. The economist Timothy Taylor sometimes asks his students to reflect on whether they would rather have a comfortable $70,000 today or a stupendous $70,000 in 1900. On paper this is a no-brainer: $70,000 in 1900 was a much larger sum. Yet the question boils down to whether one would rather have servants, status and a mansion — or smartphones, computer games, air conditioning, penicillin, air travel and takeaway pizza. On balance most students decide they’d rather have modern technology than obsolescent opulence.

Similarly, $250,000 a year in 2118 should buy wonders that could not be had today for any money. A new book, Soonish (UK) (US), by Kelly and Zach Weinersmith, is a mischievous guide to the possibilities: ultra-cheap construction, courtesy of smart materials and swarms of robots; and ultra-cheap fuel and bulk chemicals, produced by genetically engineered micro-organisms. We’ll be able to print replacement organs, swallow pills that correct genetic typos and fix cancers with ease.

Is this prediction Panglossian? Perhaps, but it does not presume a century of peace and harmony. It is more cautious than Keynes’s forecast, since which the world has witnessed appalling losses of human life in the Holocaust, Mao’s Great Leap Forward, the second world war and other disasters. We should fervently hope that the atrocities of the 20th century are never repeated, but the forecast merely assumes instead that future enormities do not threaten the human race as a whole. Any nuclear or biological war would have to be a local affair.

The other big question mark over this forecast is whether the planet itself can sustain continued economic growth. Much depends on what this growth looks like. If it means burning more fossil fuels, consuming ever greater raw materials and intensively cultivating more land, we are in trouble. Thankfully, economic growth is decoupling from resource use — not everywhere and not in every respect, but broadly enough to give reason for hope. In the UK, for example, energy consumption per person peaked in 1973.

We need smarter environmental regulations, but even without them, pure profit-seeking pushes producers to achieve more by using less. This is highlighted in Jesse Ausubel’s 2015 report, “Nature Rebounds”, which documents the increasing efficiency with which the US uses farmland, water and energy. In some cases — not all — the efficiency gains are so great that absolute use of these resources is in decline even while economic growth continues.

None of this would be enough if the world’s population was still booming at the rates that caused alarm in the 1960s. But it is not; population growth has been in steady decline for half a century. If the number of people on the planet stabilises, and the efficiency with which we use resources increases, there is nothing implausible about a continued rise in the standard of living.

A final big question is how this bounty will be distributed. In an insightful essay from 1996, Paul Krugman predicted that there would be “no robot plumbers” in 2096. I agreed with him then. I am no longer so confident. It seems quite plausible that in 100 years’ time — and perhaps much sooner — plumbers, taxi drivers and many journalists, too, will simply have nothing serious to contribute to the labour market. If so, we’ll have to abandon the current model of the welfare state in favour of one where unemployment is neither stigmatised nor penurious, but a perfectly respectable lifestyle choice. That will require some kind of universal income for all.

No doubt my forecast will be wrong, although I hope it will take a few decades before its foolishness becomes undeniable. Perhaps by 2118, humanity will have been superseded by hyper-intelligent software. Perhaps cockroaches or smallpox will have taken centre stage. But it seems to me that if we can keep the show on the road, our great grandchildren might have reason to thank us.

 
Written for and first published in the Financial Times on 29 December 2017.

My new book is “Fifty Inventions That Shaped The Modern Economy”. Grab yourself a copy in the US or in the UK (slightly different title) or through your local bookshop.

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Marginalia

Busy, Rest, Confessions… what I’ve been reading

Two interesting books about our overly-busy lifestyles: Busy (UK) (US) by Tony Crabbe and Rest (UK) (US) by Alex Soojung-Kim Pang. Crabbe’s book is pushy, airport business-booky, by no means a masterpiece of writing. But it did make me stop and think about overloading myself with nonsense – and to question bad habits such as boasting about how busy I am. I found it a very useful book to read. Rest is a better structured read, setting out the science about why we need to take more breaks, have more sleep, take longer holidays, etc. etc. – well-argued, although I think Crabbe’s bullet points made more of an impact on me.

I also re-read Scott Berkun’s Confessions of a Public Speaker (UK) (US), which is flawed but will be very useful to some. Berkun is a witty, energetic writer and the book jumps from a description of life as a professional motivational speaker to the lessons he learned from taking part in a TV series, to a set of tips on how to be a better public speaker. The confessions will interest some – not me – but the tips are good and the book is lots of fun to read. (I have a list of books that I recommend about giving a great speech.)

And I’m now 100 pages into Walter Isaacson’s Da Vinci biography (UK) (US). Long and careful, but well-written and full of interesting ideas – and gorgeous reproductions of his art.

 

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22nd of January, 2018MarginaliaComments off
Undercover Economist

Why you should check email less often, and how to do it

More than a decade ago, Dan Russell, a researcher at IBM, won fleeting attention for his email signature: “Join the slow email movement! Read your mail just twice each day. Recapture your life’s time and relearn to dream.” That was quixotic even then. While some people are slow to respond to email, most of us are quick to check it.

A 2003 study found that the typical email is attended to in some manner within six seconds of arrival. Another study, from 2006, by computer scientist Karen Renaud and colleagues, found that people at their desktop computers would check their email 18 times an hour.

When I think about my own behaviour, 18 times an hour sounds about right. It’s like a nervous twitch, with the bonus that I can tell myself and others that I’m the consummate professional. It is also insane: for all the talk of email overload, most of us do not actually receive 18 emails an hour. I don’t — not after filtering unsolicited press releases into spam. One estimate of the typical load is 80-90 emails a day, which suggests that half the time Professor Renaud’s subjects checked email, they would have found nothing there.

The ubiquity of smartphones, packed with an arsenal of e-messaging alternatives, can only have worsened the compulsion to check for new messages. Mr Russell’s plea now seems as counter-cultural as urging people to post sonnets on Tinder. Nevertheless, he was on to something. There are ways in which email might be a lot more useful if we slowed it down.

One reason is that email would probably be less habit-forming when taken in bigger, rarer doses. The psychologist BF Skinner once found himself running out of food pellets for one of his projects, which like many of his experiments involved rats pushing levers to receive rewards. To eke out his supply of pellets, Skinner restricted their release: rats would get no more than one pellet a minute, no matter how often they tapped the lever. Rather than discouraging the rats, this intermittent reinforcement soon had them hooked. These days, we’re the rats, the computer is our Skinner Box, and email is our intermittently released food pellet.

Mr Russell’s call to inaction breaks the cycle of intermittent reinforcement. If you check email no more than twice a day, your unconscious is not wondering whether you’ve got mail or not. Inevitably, you have, and your dopamine system can stop quivering in nervous anticipation.

Slow email also allows problems to solve themselves in your absence. When a colleague emails the entire company asking whether anyone has seen his sentimentally valuable coffee mug, the treasure will be found before anything hits your inbox. Meetings will be announced, withdrawn because of a typo in the date, then re-announced. It’s so much easier to wait.

And slow email should mean more time concentrating on a single task at a time. Gone is the spin-cycle in which we set aside important work to flip open the email browser tab, and then on to Facebook, or Twitter, or Wikipedia or wherever. It takes time to reorient ourselves after these self-interruptions; estimates vary from a few seconds to almost half an hour.

Bearing all this in mind, one might ask what happens when our email is turned off? Researchers Gloria Mark and Stephen Voida conducted just this experiment, observing what happened to 13 workplace guinea pigs when the researchers disconnected their email. The subjects were being watched, electronically tracked and even wearing heart monitors. They became less stressed, stayed on task for longer and spoke to their colleagues more. They sometimes felt a little out of the loop, but they survived the experience.

Unplugging for a full working week might be too much for most of us. It’s certainly too much for me. So twice a day it shall be, just like Victorian letter writers. Or nearly so: in fact late 19th-century London enjoyed hourly deliveries, and a correspondence could bounce back and forth within a day. Letter-writers would often request a reply “By Return Of Post”, exhibiting the same nervous urgency as some of my email correspondents today. Still, there is a qualitative difference between mail once an hour, and mail whenever you happen to press the level for another pellet. We might all benefit by slowing the pace.

But how to do it? One possibility is sheer willpower. Good luck with that. Or you can use some electronic help. For 2018, my resolution is to use Inbox When Ready, a free plug-in for people who access Gmail through Google’s Chrome browser. It blocks excessive access to the inbox, and works alarmingly well at dissuading me from checking my email. I cannot say it has helped with my stress levels just yet. Perhaps I need to give it time.

I wondered what Dan Russell might make of this, so I tracked down what I thought was his current email address and, apologetically, emailed with a couple of questions.

Back came the response: “The email account that you tried to reach is disabled.” Perfect.

 

Written for and first published in the Financial Times on 22 December 2017.

My new book is “Fifty Inventions That Shaped The Modern Economy”. Grab yourself a copy in the US or in the UK (slightly different title) or through your local bookshop.

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Marginalia

How To Think, in eight easy steps

I enjoyed reading Alan Jacobs’s How To Think (US) (UK). Jacobs could have worked through a list of logical fallacies, or even of cognitive biases (well-covered in David McRaney’s engaging You Are Not So Smart (US) (UK)). Instead, he’s particularly concerned with civility, open-mindedness, and the ability to let oneself be persuaded by others. The weakness of this approach is that Jacobs is rather thin on some important topics such as evaluating evidence or spotting statistical bullshit. (On this topic Bad Science (US) (UK), by Ben Goldacre MBE, cannot be bettered.)

Still, we could all use some nudges to be civil and open minded. Jacobs offers a checklist of 12 items at the end and I summarise a few here:

  1. Take five minutes before responding. Walk around the block.
  2. Don’t argue to win, argue to learn.
  3. Avoid people who fan flames.
  4. Don’t feel you have to weigh in on every topic.
  5. If your peers demand you weigh in, ponder your choice of peers.
  6. Seek out thoughtful people who disagree with you. Listen.
  7. Examine your own emotional responses.
  8. Summarise your opponents’ arguments fairly and thoughtfully.

Good advice; I hope Jacobs would feel my summary of his checklist was fair.

My new book is “Fifty Inventions That Shaped The Modern Economy”. Grab yourself a copy in the US or in the UK (slightly different title) or through your local bookshop.

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8th of January, 2018MarginaliaComments off
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Tim Harford is an author, columnist for the Financial Times and presenter of Radio 4's "More or Less".
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