Thursday, July 22, 2021

Clorox is outbidding Vanderbilt for ad space

Following up on an earlier post showing Facebook, Instagram, Google, and Twitter show 20% fewer STEM ads to women than men:  as  Scientific America explains

Women are pricier to reach because they generally make more household purchasing decisions than men do. ...
...on Instagram it cost $1.74 to get a woman’s eyeballs on the ad but only 95 cents to get a man’s.
In other words, Clorox is outbidding Vanderbilt for ad space likely to be seen by women because Clorox places a higher value on the ad.  However, auctions are efficient, so both men and women end up seeing the highest-value ads.  

 OK, so there is no "disparate treatment" of men and women, but isn't it illegal to adopt practices that have a "disparate impact?" My understanding (I am NOT an attorney) is that Federal law prohibits both "disparate treatment" and "disparate impact" discrimination, even though adhering to one would violate the other. 

 For example, if you give a bidding advantage to STEM educational institutions when they bid for ad space likely to be seen by women, the algorithm is treating women differently than men.  This kind of disparate treatment is what the article recommends.

The same kind of tradeoff shows up in the current debate about equality (equal treatment) and equity (equal outcomes). If we want equity, we have to give up on equality.  

Thursday, July 15, 2021

Price Changes by Product

Mark Perry has updated and discusses an important graphic. Follow the link to get further insights but I want to focus specifically on the prices for college textbooks below. It is the only one in which the trend has changed. Why?

There are more open source materials available, but I doubt they are widely used. I conjecture that this is due to reduced piracy. It is so easy to scan and post online a PDF version of a textbook that publishers had expected a >50% drop in sales in each successive year of a new edition. (This had also caused a reduction in the time between editions.)

However, a few years ago, textbook publishers adopted a new strategy of pushing online textbooks that came bundled with lots of other online material (my favorite textbook included). Among the online material were assignments, quizzes, and test materials whose scores can be embedded directly into an instructor's Learning Management System (LMS) like Canvas or Blackboard. This meant students needed to subscribe to the online material to complete these assignments needed for their courses. I suspect this caused the amount of piracy to plummet and this negated both the constant need for publishers to stamp out piracy and the rationale for constant price increases. These are testable implications with the right data.

Are market innovations at work with other pirated information goods? Subscribers to music streaming platforms like Spotify and Pandora that bundle huge libraries of songs have little need to search for a pirated song. In this case, each service has access to practically the entirety of recorded music. Video is different. Much of the content on Netflix is not available on Apple+ or Peacock. Each service is a bundle of non-overlapping content. Unless one subscribes to them all, there is still an incentive to pirate a highly-desired, but unavailable, movie.

Saturday, July 10, 2021

NIMBY zoning is hurting our kids

Housing prices now consume 40% of the income of new home buyers. Baby Boomers paid only 30%. The difference is NIMBY zoning. Plus density is green. Fabulous essay by Ken Glaeser:
Americans who settle in leafy, low-density suburbs will leave a significantly deeper carbon footprint, it turns out, than Americans who live cheek by jowl in urban towers. And a second paradox follows from the first. When environmentalists resist new construction in their dense but environmentally friendly cities, they inadvertently ensure that it will take place somewhere else—somewhere with higher carbon emissions. Much local environmentalism, in short, is bad for the environment.
Thoreau was wrong. Living in the country is not the right way to care for the Earth. The best thing that we can do for the planet is build more skyscrapers.
Link to Chapter 8: restrictions on housing supply (zoning) prevent supply from expanding and raise price.

Sunday, July 4, 2021

Compensating differentials for government jobs

In India, government jobs pay 81% less than equivalent jobs in the private sector because of their amenities, like "lifetime tenure, access to bribes and prestige."


Thursday, July 1, 2021

I am not sure this is how I would characterize my work, but ...

Why the US is so friendly to monopolies

What they're saying: "Numerous hard-wired differences between the European and American enforcement regimes make it very difficult for U.S. antitrust enforcement agencies to emulate their EU counterparts," wrote antitrust experts Gregory Werden and Luke Froeb in an article in 2019. 

In 10 different areas, they found it much easier to crack down on large monopolies in Europe than in the U.S.

The big picture: European antitrust measures are decided by politicians; in the U.S. it's up to judges.