Technology and society as chicken and egg

Is Twitter the cause or the by-product of our half-baked public discourse? Paper by Mark Kurlanksy is a thinly veiled rumination on this question.

Not Twitter exactly, but whether technology shapes society or is instead shaped by it. Kurlanky comes down very much on the latter.

It wasn’t paper and ink that spurred bureaucracy, philosophy, religion, drawing, painting, widespread literacy, or the accumulation and harmonisation of knowledge.

Rather, these technologies filled a pre-existing need, slotting in to a revolution that was well underway. Gutenberg didn’t so much kick-start modern mass literacy and learning, as pour petrol on the fire.

A technology that is intended to redirect society will usually fail. In fact, most technology companies do not introduce new technology but new ways to use ideas that already exist.

Of course, Paper is very much a micro-history of, well, paper. Full of anecdotes of European water wheels, wind mills, buddhist monks and holy books. I’ve learned all I ever need to about the acid content of paper and the differences between rags and wood pulp.

But it’s Kurlanky’s reversal of technological causality that really makes this book worthwhile. Especially in the last few decades, we have become very adept at ignoring survivor bias and lesser-known forerunners, giving an extraordinary amount of credit to the Jobs, Zuckerbergs and Pages.

As if Google drove the internet rather than systematising and building upon the work of portals and curators like Yahoo. This is not to take away from these amazing technologies and technologists, but who really had the agency when it came to Google?

In his seminal work Das Kapital, Karl Marx said that the Luddites failed because they opposed the machines instead of the society. He observed: “The Luddites’ mistake was that they failed to distinguish between machinery and its employment by capital, and to direct their attacks, not against the material instruments of production, but against the mode in which they are used.” In other words, it is futile to denounce technology itself. Rather, you have to try to change the operation of the society for which the technology was created…

You cannot warn about what a new technology will do to a society because that society has already made the shift. That was Marx’s point about the Luddites. Technology is only a facilitator. Society changes, and that change creates new needs. That is why the technology is brought in. The only way to stop the technology would be to reverse the changes in the society.

I’m not sure if Kurlanksy has me entirely convinced. But it certainly bears thinking about.

The cost of affirmative action

We evaluate the effect of introducing a gender quota in an environment where high-performing women fail to enter competitions they can win. We show that guaranteeing women equal representation among winners increases their entry. The response exceeds that predicted by the change in probability of winning and is in part driven by women being more willing to compete against other women. The consequences are substantial as the boost in supply essentially eliminates the anticipated costs of the policy..

Prior to affirmative action, women, including high-performing women, fail to enter the competition. Despite there being no discrimination, very few women win the tournaments…Although some high- performing men drop out of the competition, many women come in, and the overall number of high- performing participants in the entry pool is barely affected.

Read the paper

Be more skeptical about fair trade

I’ve always been a bit skeptical of "fair trade". Supply chains are long and complicated, there’s little oversight on retailer margins and it’s unclear how much producers actually benefit.

A recently published paper in World Development appears to back up some of these fears. The authors found that less than a third of the premium paid for fair trade Ethiopian coffee makes its way to producers. Exporters grab a healthy slice, and the cost to comply with certification is great for both farmers and cooperatives.

This is based on interviews with 1600 producers, cooperatives’s own records (numbering some 150,000 transactions), and data from the Ethiopian Ministry of Trade.

If an average Ethiopian coffee farmer, who annually sells the equivalent of 400kg of red cherries, were to market all his or her red cherries as VSS certified, with current VSS premium transmission rates, the farmer’s annual income would increase by 6.7 USD compared to the non-certified cooperative farmer (assuming both types of farmers sell all coffee to the cooperative). Even in the case of a perfect transmission, the annual income of the average certified coffee farmer would only increase by 22USD compared to a non-certified cooperative farmer

The paper also notes that certification poses significant barriers to entry. For instance, it requires detailed documentation in areas where many have not gone to school. Environmental and labor standards are admirable, but they also increase the costs for producers.

Producers that are able to comply with all of this are likely those relatively better off in the first place. The paper notes that certified households are more likely to be located close to paved roads and coffee cooperatives, and have heads of households that are older and more likely to have gone to school.

And if that wasn’t bad enough, do these standards really achieve anything?

…farmers in these settings often have diverse crop portfolios. They may be able to use sustainable production practices on their coffee plots but not on their other crops. Moreover, resources can be re-allocated within the farm from coffee to other crops, e.g., no child labor on coffee plots might mean more child labor on other plots. While coffee might have been sustainably produced and certified, it is possible that little might have changed in the aggregate at the farm, village, or country level.

Now, this is one study, and it’s an analysis of just one country and cash crop. But at the very least it invites more skepticism.

Paying players pays

Is Stephen Curry actually worth more than $30 million a year? How about Lebron James, Russell Westbrook or James Harden?

Five Thirty Eight make a pretty good case that NBA superstars are generally underpaid, relative to what they would earn in an open market.

But that analysis is based on their impact on the court.

This is the top-heavy nature of production in the NBA, and why superstars are so valuable just as a basic bookkeeping cheat code: They create surplus value for their teams (and more generally the league as a whole) that is funneled into less productive players.

What is the business case for paying Stephen Curry >$30 million?

Well, according to a paper by Harrison Li at Berkeley, both superstars and wins add to the bottom line.

..every extra win during the season will bring in .3% more revenue to a team. To put this into context, each individual win for a team like the Los Angeles Lakers, who gained about 214 million dollars in revenues this past year, brought in about 642,000 dollars.

As only five players take the court at a time, one person can have a huge impact on winning. More wins mean more people coming to the games (yay bandwagon fans).

It also means teams can charge more for season tickets and premium seats, and more lucrative local television deals (something a lot of teams depend on). Of course, not all of this is realised immediately. Television deals, for example, are negotiated only every few years.

When the Boston Celtics (my team) added superstars Ray Allen and Kevin Garnett in 2007 the team’s salary went up by $25.5 million. But Li estimates revenue increased by over $40 million due to the extra wins and playing more games (thanks to making the playoffs and winning the championship).

So it seems like paying players does pay. Although this paper is a bit old now. It would be interesting to see some fresh analysis, accounting for the new collective bargaining agreement and stratospheric increases in the salary cap.

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