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cheap talk
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politicians and backward induction
meetings
northwestern wins despite brilliant last-minute gambit by vanderbilt’s matthew fisher-davis
ariel rubinstein review’s dani rodrik’s “economics rules”
my op-ed with tim feddersen re nordstrom-trump
the late, great a gill on india
isis, germany and the provocation tactic
trumprediction: the worst case scenario and a best response
jury duty tip at leighton court chicago
failure of big data
friday music: bad plus, “everybody wants to rule the world”
trumprediction: most likely outcome for trump presidency
trumprediction: nuclear proliferation
evangelicals can delete dominated strategies but greens cannot
friday music
trumprediction: isis
forecaster horse race
economics nobel 2016: oliver hart and bengt holmstrom
should republicans dump trump – a backward induction argument
thoughts left lying around about election forecasts
henry viii and brexit
trumpellence and the donald’s optimal strategy
why you don’t see ads for american idol on abc
i think i finally figured it out
what the contested convention odds tell us
who is the best republican presidential candidate for congressional republicans?
negative campaigning in multi-candidate elections
the establishment gop needs approval voting in the primaries
isil and its confused strategy
what i like about kellogg…
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H4 state outcomes are highly correlated with one another, so polling errors in one state are likely to be replicated in other, similar states….if clinton loses pennsylvania despite having a big lead in the polls there, for instance, she might also have problems in michigan, north carolina and other swing states.
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strong
jg: so there is some chance of more instability.
hk:
jg: the threat from isis is more serious now?
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jg: so there is some chance of more instability.
hk:
jg: the threat from isis is more serious now?
hk:
em jg: so there is some chance of more instability.
hk:
jg: the threat from isis is more serious now?
hk:
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em 4
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home https://cheaptalk.org/
who we are https://cheaptalk.org/about/
jeff’s intermediate micro course https://cheaptalk.org/jeffs-intermediate-micro-course/
behavioral economics reading list https://cheaptalk.org/behavioral-economics-reading-list/
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politicians and backward induction https://cheaptalk.org/2017/04/04/politicians-and-backward-induction/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2017/04/04/politicians-and-backward-induction/#respond
susan collins http://topics.nytimes.com/top/reference/timestopics/people/c/susan_collins/index.html
lisa murkowski http://topics.nytimes.com/top/reference/timestopics/people/m/lisa_murkowski/index.html
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meetings https://cheaptalk.org/2017/03/20/meetings/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
1 comment https://cheaptalk.org/2017/03/20/meetings/#comments
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northwestern wins despite brilliant last-minute gambit by vanderbilt’s matthew fisher-davis https://cheaptalk.org/2017/03/17/northwestern-wins-despite-brilliant-last-minute-gambit-by-vanderbilts-matthew-fisher-davis/
uncategorized https://cheaptalk.org/category/uncategorized/
jeff https://cheaptalk.org/author/cheeptalk/
3 comments https://cheaptalk.org/2017/03/17/northwestern-wins-despite-brilliant-last-minute-gambit-by-vanderbilts-matthew-fisher-davis/#comments
commentators and all of social media http://www.sbnation.com/college-basketball/2017/3/16/14947204/northwestern-vs-vanderbilt-foul-score-2017-ncaa-tournament
offensive efficiency https://www.teamrankings.com/ncaa-basketball/stat/offensive-efficiency
northwestern was shooting a 49% field goal percentage for the game http://www.espn.com/mens-college-basketball/boxscore?gameid=400946439
wolfram alpha https://www.wolframalpha.com/input/?i=.85%5e2p+%2b(.15)%5e2+%2b2(.15)(.85)(p+%2b(1-p)%2f2)+%3d+1-p
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ariel rubinstein review’s dani rodrik’s “economics rules” https://cheaptalk.org/2017/03/10/ariel-rubinstein-reviews-dani-rodriks-economics-rules/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2017/03/10/ariel-rubinstein-reviews-dani-rodriks-economics-rules/#respond
link http://arielrubinstein.tau.ac.il/papers/100.pdf
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my op-ed with tim feddersen re nordstrom-trump https://cheaptalk.org/2017/02/13/my-op-ed-with-tim-feddersen-re-nordstrom-trump/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2017/02/13/my-op-ed-with-tim-feddersen-re-nordstrom-trump/#respond
in chicago tribune (edited by paper in some ways that make it less clear!). http://www.chicagotribune.com/news/opinion/commentary/ct-trump-tweet-nordstrom-ivanka-clothing-perspec-0213-20170210-story.html
terrorists as much as activists aim to provoke http://www.kellogg.northwestern.edu/faculty/baliga/htm/provocation.pdf
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the late, great a gill on india https://cheaptalk.org/2016/12/23/the-late-great-a-gill-on-india/
travel https://cheaptalk.org/category/travel/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
1 comment https://cheaptalk.org/2016/12/23/the-late-great-a-gill-on-india/#comments
on brexit http://dndlaw.com/aa-gill-on-brexit/
on worst restaurant in the world http://www.vanityfair.com/style/2011/04/lami-louis-201104
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isis, germany and the provocation tactic https://cheaptalk.org/2016/12/21/isis-germany-and-the-provocation-tactic/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/12/21/isis-germany-and-the-provocation-tactic/#respond
washpo article https://www.washingtonpost.com/world/national-security/truck-attack-may-be-part-of-isis-strategy-to-sharpen-divide-between-muslims-and-others/2016/12/20/edbf784a-c703-11e6-85b5-76616a33048d_story.html?utm_term=.08a0e0cbc6b3
our paper http://www.kellogg.northwestern.edu/faculty/baliga/htm/provocation.pdf
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trumprediction: the worst case scenario and a best response https://cheaptalk.org/2016/11/30/trumprediction-the-worst-case-scenario-and-a-best-response/
trumprediction https://cheaptalk.org/category/trumprediction/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/11/30/trumprediction-the-worst-case-scenario-and-a-best-response/#respond
bush presidency with some trumpian twists https://cheaptalk.org/2016/11/16/trumprediction-most-likely-outcome-for-trump-presidency/
blog post https://econciv.wordpress.com/2016/11/22/a-memo-to-the-democratic-party/
blog post https://econciv.wordpress.com/2016/11/22/a-memo-to-the-democratic-party/
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jury duty tip at leighton court chicago https://cheaptalk.org/2016/11/29/jury-duty-tip-at-leighton-court-chicago/
food and wine https://cheaptalk.org/category/food-and-wine/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/11/29/jury-duty-tip-at-leighton-court-chicago/#respond
tacqueria el milagr http://www.el-milagro.com/locations.html
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failure of big data https://cheaptalk.org/2016/11/21/failure-of-big-data/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/11/21/failure-of-big-data/#respond
were wildly off http://www.nytimes.com/2016/11/19/opinion/why-i-had-to-eat-a-bug-on-cnn.html
his theory of correlated forecasting errors http://fivethirtyeight.com/features/election-update-why-our-model-is-more-bullish-than-others-on-trump/
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friday music: bad plus, “everybody wants to rule the world” https://cheaptalk.org/2016/11/18/friday-music-bad-plus-everybody-wants-to-rule-the-world/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/11/18/friday-music-bad-plus-everybody-wants-to-rule-the-world/#respond
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trumprediction: most likely outcome for trump presidency https://cheaptalk.org/2016/11/16/trumprediction-most-likely-outcome-for-trump-presidency/
trumprediction https://cheaptalk.org/category/trumprediction/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/11/16/trumprediction-most-likely-outcome-for-trump-presidency/#respond
trump is thin-skinned and hence a prime candidate for manipulation by terrorists who seek to escalate conflict https://cheaptalk.org/2016/11/10/trumprediction-isis/
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trumprediction: nuclear proliferation https://cheaptalk.org/2016/11/15/trumprediction-nuclear-proliferation/
trumprediction https://cheaptalk.org/category/trumprediction/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/11/15/trumprediction-nuclear-proliferation/#respond
if not, why not let these countries go nuclear? http://www.nytimes.com/2016/03/27/us/politics/donald-trump-transcript.html?_r=1
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evangelicals can delete dominated strategies but greens cannot https://cheaptalk.org/2016/11/14/evangelicals-can-delete-dominated-strategies-but-greens-cannot/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
1 comment https://cheaptalk.org/2016/11/14/evangelicals-can-delete-dominated-strategies-but-greens-cannot/#comments
michigan http://www.nytimes.com/elections/results/michigan
wisconsin http://www.nytimes.com/elections/results/wisconsin
jorg spenkuch http://www.kellogg.northwestern.edu/faculty/spenkuch/research/voting.pdf
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friday music https://cheaptalk.org/2016/11/11/friday-music/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/11/11/friday-music/#respond
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trumprediction: isis https://cheaptalk.org/2016/11/10/trumprediction-isis/
trumprediction https://cheaptalk.org/category/trumprediction/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/11/10/trumprediction-isis/#respond
it turns out henry kissinger agrees with me: http://www.theatlantic.com/magazine/archive/2016/12/the-lessons-of-henry-kissinger/505868/
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forecaster horse race https://cheaptalk.org/2016/11/05/forecaster-horse-race/
uncategorized https://cheaptalk.org/category/uncategorized/
jeff https://cheaptalk.org/author/cheeptalk/
4 comments https://cheaptalk.org/2016/11/05/forecaster-horse-race/#comments
that’s a puzzle in itself https://cheaptalk.org/2016/07/21/thoughts-left-lying-around-about-election-forecasts/
every other forecaster http://www.nytimes.com/interactive/2016/upshot/presidential-polls-forecast.html?_r=0#other-forecasts
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economics nobel 2016: oliver hart and bengt holmstrom https://cheaptalk.org/2016/10/10/economics-nobel-2016-oliver-hart-and-bengt-holmstrom/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
1 comment https://cheaptalk.org/2016/10/10/economics-nobel-2016-oliver-hart-and-bengt-holmstrom/#comments
several of these papers http://www.kellogg.northwestern.edu/research/math/discussion/author2.htm#h
collude http://www.kellogg.northwestern.edu/faculty/baliga/htm/decen.pdf
renegotiate http://www.kellogg.northwestern.edu/faculty/baliga/htm/nih50.pdf
work http://www.kellogg.northwestern.edu/faculty/baliga/htm/coord.pdf
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should republicans dump trump – a backward induction argument https://cheaptalk.org/2016/08/05/should-republicans-dump-trump-a-backward-induction-argument/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
1 comment https://cheaptalk.org/2016/08/05/should-republicans-dump-trump-a-backward-induction-argument/#comments
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thoughts left lying around about election forecasts https://cheaptalk.org/2016/07/21/thoughts-left-lying-around-about-election-forecasts/
uncategorized https://cheaptalk.org/category/uncategorized/
jeff https://cheaptalk.org/author/cheeptalk/
3 comments https://cheaptalk.org/2016/07/21/thoughts-left-lying-around-about-election-forecasts/#comments
other forecaster https://cheaptalk.org/2012/10/13/martingales-dont-do-this/
infinitely many forecasters http://www.nytimes.com/interactive/2016/upshot/presidential-polls-forecast.html?_r=0#other-forecasts
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henry viii and brexit https://cheaptalk.org/2016/06/27/henry-viii-and-brexit/
art of office politics https://cheaptalk.org/category/art-of-office-politics/
banana seeds https://cheaptalk.org/category/banana-seeds/
tongue in cheek https://cheaptalk.org/category/tongue-in-cheek/
vapor mill https://cheaptalk.org/category/vapor-mill/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
3 comments https://cheaptalk.org/2016/06/27/henry-viii-and-brexit/#comments
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trumpellence and the donald’s optimal strategy https://cheaptalk.org/2016/06/16/trumpellence-and-the-donalds-optimal-strategy/
art of office politics https://cheaptalk.org/category/art-of-office-politics/
tongue in cheek https://cheaptalk.org/category/tongue-in-cheek/
vapor mill https://cheaptalk.org/category/vapor-mill/
current events https://cheaptalk.org/tag/current-events/
incentives https://cheaptalk.org/tag/incentives/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
1 comment https://cheaptalk.org/2016/06/16/trumpellence-and-the-donalds-optimal-strategy/#comments
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why you don’t see ads for american idol on abc https://cheaptalk.org/2016/04/07/why-you-dont-see-ads-for-american-idol-on-abc/
uncategorized https://cheaptalk.org/category/uncategorized/
jeff https://cheaptalk.org/author/cheeptalk/
7 comments https://cheaptalk.org/2016/04/07/why-you-dont-see-ads-for-american-idol-on-abc/#comments
yesterday https://cheaptalk.org/2016/04/06/i-think-i-finally-figured-it-out/
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i think i finally figured it out https://cheaptalk.org/2016/04/06/i-think-i-finally-figured-it-out/
uncategorized https://cheaptalk.org/category/uncategorized/
jeff https://cheaptalk.org/author/cheeptalk/
2 comments https://cheaptalk.org/2016/04/06/i-think-i-finally-figured-it-out/#comments
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what the contested convention odds tell us https://cheaptalk.org/2016/04/06/what-the-contested-convention-odds-tell-us/
uncategorized https://cheaptalk.org/category/uncategorized/
jeff https://cheaptalk.org/author/cheeptalk/
4 comments https://cheaptalk.org/2016/04/06/what-the-contested-convention-odds-tell-us/#comments
primary.guide https://primary.guide
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who is the best republican presidential candidate for congressional republicans? https://cheaptalk.org/2016/03/16/who-is-the-best-republican-presidential-candidate-for-congressional-republicans/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/03/16/who-is-the-best-republican-presidential-candidate-for-congressional-republicans/#respond
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negative campaigning in multi-candidate elections https://cheaptalk.org/2016/02/10/negative-campaigning-in-multi-candidate-elections/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
4 comments https://cheaptalk.org/2016/02/10/negative-campaigning-in-multi-candidate-elections/#comments
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the establishment gop needs approval voting in the primaries https://cheaptalk.org/2016/02/08/the-establishment-gop-needs-approval-voting-in-the-primaries/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2016/02/08/the-establishment-gop-needs-approval-voting-in-the-primaries/#respond
from http://www.buzzfeed.com/tariniparti/the-dilemma-of-the-anti-trump-voter#.mup3wxwbvy
buzzfeed: http://www.buzzfeed.com/tariniparti/the-dilemma-of-the-anti-trump-voter#.mup3wxwbvy
perhaps the gop should adopt approval voting as suggested by my colleague bob weber where each voter can “approve” as many candidates as he likes. https://en.wikipedia.org/wiki/approval_voting
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isil and its confused strategy https://cheaptalk.org/2015/11/17/isil-and-its-confused-strategy/
war https://cheaptalk.org/category/war/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
1 comment https://cheaptalk.org/2015/11/17/isil-and-its-confused-strategy/#comments
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what i like about kellogg… https://cheaptalk.org/2015/11/03/what-i-like-about-kellogg/
uncategorized https://cheaptalk.org/category/uncategorized/
sandeep baliga https://cheaptalk.org/author/cheepsandeep/
leave a comment https://cheaptalk.org/2015/11/03/what-i-like-about-kellogg/#respond
- https://cheeptalk.files.wordpress.com/2015/11/screenshot-2015-11-03-09-04-21.png
robert mcdonald, associate dean for faculty, and jeff cohen performing “here comes the weekend” by dave edmunds and nick lowe and “what’s so funny about peace, love and understanding?” by nick lowe. https://www.dropbox.com/s/l0tj8r3str6qa1u/img_0945.m4v?dl=0
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why is it a crime to park facing the wrong way? https://cheaptalk.org/2011/06/01/why-is-it-a-crime-to-park-facing-the-wrong-way/
what is the recommended serving temperature for guinness? https://cheaptalk.org/2009/06/20/what-is-the-recommended-serving-temperature-for-guinness/
left, right, then left again https://cheaptalk.org/2009/07/20/left-right-then-left-again/
pricing bareback https://cheaptalk.org/2009/10/01/pricing-bareback/
nick kokonas is still wrong about not using auctions at next https://cheaptalk.org/2014/01/06/nick-kokonas-is-still-wrong-about-not-using-auctions-at-next/
why does the fastest swimmer anchor a relay? https://cheaptalk.org/2010/02/02/why-does-the-fastest-take-the-anchor-leg-of-a-relay/
how to open a bag of charcoal https://cheaptalk.org/2011/05/29/how-to-open-a-bag-of-charcoal/
how to shill on ebay https://cheaptalk.org/2010/02/12/how-to-shill-on-ebay/
why exams should be open book https://cheaptalk.org/2009/04/29/why-exams-should-be-open-book/
selling season tickets is a money loser https://cheaptalk.org/2013/02/27/selling-season-tickets-is-a-money-loser/
art https://cheaptalk.org/tag/art/
art of office politics https://cheaptalk.org/tag/art-of-office-politics/
banana seeds https://cheaptalk.org/tag/banana-seeds/
blog https://cheaptalk.org/tag/blog/
books https://cheaptalk.org/tag/books/
boston https://cheaptalk.org/tag/boston/
california https://cheaptalk.org/tag/california/
chicago https://cheaptalk.org/tag/chicago/
coffee https://cheaptalk.org/tag/coffee/
computers https://cheaptalk.org/tag/computers/
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cheap talk a blog about economics, politics and the random interests of forty-something professors home who we are jeff’s intermediate micro course behavioral economics reading list crumbs subscribe to feed politicians and backward induction april 4, 2017 in uncategorized | by sandeep baliga | leave a comment nyt on whether to filibuster gorsuch now or wait: the substantive stakes now are relatively low: judge gorsuch appears to be very conservative, but so was justice scalia. confirming judge gorsuch would merely preserve the ideological status quo on the closely divided supreme court. should the confirmation move ahead, all 52 republican senators will probably stick together, bolstered by a few democrats from conservative-leaning states. those are enough votes to easily clear the way for confirming judge gorsuch — and all future nominees — by a simple majority. but the dynamics could play out differently in a second situation: judge gorsuch is confirmed, but the filibuster rule survives. if mr. trump then gets to nominate a successor to a moderate or liberal justice, the substantive stakes would be much higher. the framing for the filibuster fight would be different at that point. it would focus on whether the nominee would provide a fifth vote to overrule the roe v. wade abortion rights precedent and create a new conservative majority on other highly charged topics, like guns, affirmative action and the rights of same-sex couples. under that second possibility, it may not be inevitable that the filibuster rule falls. red-state democrats would be less likely to break ranks, and institutionalist or moderate republican senators, like susan collins of maine and lisa murkowski of alaska, might be more reluctant to vote to change the chamber’s longstanding rules. if red state democrats and collins and murkowski can do backward induction, filibustering now or later is equivalent. also, if republicans use the “nuclear option”, this reveals their type to kennedy who may then defer retirement so he is not replaced by a trump appointee. talk cheaplytweet meetings march 20, 2017 in uncategorized | by sandeep baliga | 1 comment a few weeks ago, i went to a meeting. there was a part of the meeting where some open-ended information was disseminated and very general comments were sought. now, one possibility when you make a comment is that it leads to interesting responses and a “whole if bigger than the sum of the parts” dynamic develops. let us call this the brainstorming case. (this is the scenario that is meant to occur in research seminars.) much more likely is the “every action has an equal reaction” case where you talk, others respond but really the discussion goes nowhere and you wish no-one had talked in the first place. let us called this the bs case. casual empiricism suggests that the bs case is much more common than the brainstorming case. this fact implies that comments should be taxed to internalize the negative externality but with taxation impossible we have to rely on morality to create incentives. any moral individual should take into account the horrific effect of their casual comments. even a rational decision-maker should take the negative feedback loop into account – in this sense, the bs case helps rational individuals take the horrific effects of talking at meetings into account. however, even this does not account for the acute suffering of the innocent by-listener so the moral individual should ratchet up the threshold for talking yet further. of course, this does not happen. there are always one or two people who have to talk. this is valuable not because of what they say but because of what others do not say. namely, the people who do not talk are to be celebrated. they either see through the logic above and are quite moral or, to add another dimension, they are nice and kind of shy. either case, these are nice people. hang out with them. meetings with just these people might be quite productive so put them on committees. talk cheaplytweet northwestern wins despite brilliant last-minute gambit by vanderbilt’s matthew fisher-davis march 17, 2017 in uncategorized | by jeff | 3 comments there was 20 seconds left, vanderbilt had just scored a layup to go ahead by 1 and northwestern’s bryant mcintosh was racing to midcourt to set-up a final chance to regain the lead and win the game.  vanderbilt’s matthew fisher-davis intentionally fouled him, sending mcintosh to the line and the commentators and all of social media into a state of bewilderment.  yes, we understand intentionally fouling when you are down 1 with 20 seconds to go, but when you are ahead by 1? but it was a brilliant move and it failed only because the worst-case scenario (for vanderbilt) realized:  mcintosh made two clutch free throws and vanderbilt did not score on the ensuing possession. (before we get into the analysis, a simple way to understand the logic of the play is to notice that intentionally fouling late in the game very often is the right strategic move when you are down by a few points and there is no reason that should change precipitously when the point differential goes from slightly negative to slightly positive.the tactic is based on a  tradeoff between giving away (random) points and getting (for sure) possession.  the factors in that tradeoff are continuous as a function of the current scoring margin.) let be the probability that a team scores (at least two points) on a possession.  let be the probability that bryant mcintosh makes a free throw.  roughly, the probability that vanderbilt wins if they do not foul is because northwestern is going to play for the final shot and win if they make a field goal. what is the probability that vanderbilt wins when fisher-davis fouls? there are multiple, mutually-exclusive ways they could win.  first, mcintosh might miss both free-throws.  this happens with probability .  the other simple case is mcintosh makes both free-throws, a probability event, in which case vanderbilt wins by scoring on the following possession, which they do with probability . thus, the total probability vanderbilt wins in this second case is . the third possibility is mcintosh makes one free-throw.  this has probability . (i am pretty sure mcintosh was shooting two, i.e. northwestern was in the double bonus, but if it was a one-and-one this would make fisher-davis’ case even stronger.)  now there are two sub-cases.  first, vanderbilt could score on the ensuing and win.  second, even if they don’t score, it will be tied and the game will be sent into overtime. let’s say vanderbilt wins with probability in overtime, a conservative number since vanderbilt had all the momentum at that stage of the game. then the total probability of a vanderbilt win in this third case is .  adding up all of these probabilities, vanderbilt wins using the fisher-davis foul with probability fisher-davis made the right move provided the above expression exceeds .  let’s start by noticing some basic properties.  first, if then fouling is always the right move, no matter what is.  (if northwestern is going to score for sure, you want to foul and get possession so that you can score for sure and win.)  if then again fouling is the right strategy, regardless of .  (if he’s going to miss his free-throws then send him to the line.) next, notice that the probability vanderbilt wins when fisher-davis fouls is monotonically increasing in . since the probability vanderbilt wins without fouling is decreasing in , the larger it is the better the fisher-davis gambit looks. finally, even if , so that mcintosh is surely going to sink two free-throws, fisher-davis made the right move as long as . ok so what are the actual values of and .  mcintosh is an 85% free-throw shooter so .  its harder to estimate but here are some guidelines.  first, both teams were scoring (at least two points) on just about every possession down the stretch of that game.  an estimate based on the last 3 minutes of data would put at at least , in any case certainly larger than . more generally, i googled a bit and found something basketball stat guys call offensive efficiency.  it’s an estimate of the number of points scored per possession.  northwestern and vanderbilt have very similar numbers here, about 1.03.  a crude way to translate that into the number we are interested, namely probability of at least 2 points in a possession, is to simply divide that number in half, again giving .  (this would be exactly right if you could only ever score 2 points.  but of course there are three-point possessions and one-point possessions.)  a third way is to notice that northwestern was shooting a 49% field goal percentage for the game.  this doesn’t equal field goals per possession of course because some possessions lead to turnovers hence no field goal attempt, and on the other side some possessions lead to multiple field goal attempts due to offensive rebounds. so as far as i know there isn’t one convincing measure of but its pretty reasonable to put it above at that phase of the game.  this would be enough to justify fisher-davis even if mcintosh was certain to make both free throws.  (i used wolfram alpha to figure out what would be required given the precise value and it is about .45). finally, even if is below say around it means that the foul lowered vanderbilt’s win probability but not by very much at all. probably less than every single time in the game that someone missed a shot.  certainly less than a few seconds later when lachance missed the winning shot on the final possession.  its interesting how in close games the specific things we focus our attention on when in fact pretty much every single play in the game turned out to be pivotal. talk cheaplytweet ariel rubinstein review’s dani rodrik’s “economics rules” march 10, 2017 in uncategorized | by sandeep baliga | leave a comment here is a passage from ariel’s interesting and thought-provoking review: “the following famous quote is taken from a letter written by john maynard keynes to roy harrod in 1938: “it seems to me that economics is a branch of logic, a way of thinking”; “economics is a science of thinking in terms of models joined to the art of choosing models which are relevant to the contemporary world.” economists enjoy discussing this question. i sometimes wonder if the question of whether economics is a science is about the commitment of economics to certain standards or whether it is actually about gaining entry into that prestigious club called science. dani takes the question seriously and declares: “models make economics a science” (p. 45). he rejects what he describes as the most common justification given by economists for calling economics a science: “it’s a science because we work with the scientific method: we build hypotheses and then test them. when a theory fails the test, we discard it and either replace it or come up with an improved version.” dani’s response: “this is a nice story, but it bears little relationship to what economists do in practice. . . ” (p. 64). he also admits that “. . . [economic] methods are as much craft as they are science. good judgment and experience are indispensable, and training can only get you so far. perhaps as a consequence, graduate programs in economics pay very little attention to craft” (p. 83).” here is the link. talk cheaplytweet my op-ed with tim feddersen re nordstrom-trump february 13, 2017 in uncategorized | by sandeep baliga | leave a comment in chicago tribune (edited by paper in some ways that make it less clear!). main point: way trump reacts to #grabyourwallet campaign against nordstrom shows he is (1) easily provokable and (2) emotionally connected to his “brand”. terrorists as much as activists aim to provoke and have learned that trump-branded properties worldwide are good targets if they aim to inflame trump. talk cheaplytweet the late, great a gill on india december 23, 2016 in travel | by sandeep baliga | 1 comment on brexit on worst restaurant in the world talk cheaplytweet isis, germany and the provocation tactic december 21, 2016 in uncategorized | by sandeep baliga | leave a comment interesting washpo article re germany truck attack: islamic state officials have explicitly sought to link such attacks to the larger goal of making europe intolerable for faithful muslims. a 2015 article in the group’s english-language magazine, dabiq, warned that the terrorists would soon begin targeting the west with the aim of deliberately provoking a backlash against muslims living there. “muslims in the west,” the article said, “will quickly find themselves between one of two choices: they either apostatize and adopt the [western] religion . . . or they emigrate to the islamic state and thereby escape persecution.” somewhat consistent with our paper but generates some new questions – unlike al qaeda, isis is a near state not a terrorist group. the main threat to its survival is western tacit support to a putin-assad (and trump?) coalition against isis. if these terrorists attacks lead to such a  coalition, provocation will backfire. talk cheaplytweet trumprediction: the worst case scenario and a best response november 30, 2016 in trumprediction | by sandeep baliga | leave a comment my prediction for the trump presidency is still that it will be a bush presidency with some trumpian twists (e.g. infrastructure spending). but there is a worse scenario. who thinks that president obama will say on january 20 that he is not stepping down because his “replacement” lost the popular vote and won the electoral college because of russian hacking?  the whole idea seems farfetched. on the other hand, if peotus trump loses the election in four years, who thinks he might say the election was rigged and try to stay on? this does not seem farfetched. so the most important job of congress is to check-and-balance peotus’s excesses. how should congress do so? as usual, roger myerson is ahead of the rest of us in thinking about this. in a blog post he writes: america’s constitutional system depends fundamentally on a balanced distribution of power between the separate branches of government. over the past century, a long expansion in the size and scope of federal agencies has entailed a steady growth of presidential power. now, with a president-elect who has never exercised public power within constitutional limits, our best hope is that the next four years should be a time for strengthening the effective authority of congress. for this vital goal, democrats today should support the constitutional right of congressional majorities to legally direct the policies and actions of the federal government, even when those majorities happen to be republican. his blog post makes many points including regarding the paradoxical impact of term limits for congress and the misuse of the filibuster. talk cheaplytweet jury duty tip at leighton court chicago november 29, 2016 in food and wine | by sandeep baliga | leave a comment eat at tacqueria el milagro: chile relleno tacos talk cheaplytweet failure of big data november 21, 2016 in uncategorized | by sandeep baliga | leave a comment the poll aggregators were wildly off as they gave hillary clinton an over 90% chance of winning. nate silver was the most pessimistic because of his theory of correlated forecasting errors: state outcomes are highly correlated with one another, so polling errors in one state are likely to be replicated in other, similar states….if clinton loses pennsylvania despite having a big lead in the polls there, for instance, she might also have problems in michigan, north carolina and other swing states. the correlating factor appears to be the white working class vote which abandoned clinton in the rust belt states. for reasons we do not yet fully understand, this vote for trump did not appear in polls. the polls were then all off the mark in all rust belt states. the others poll aggregators assumed independence and gave less thought to a simple theory of voting that might generate independence let alone whether such a theory might be plausible. if they hand, it would have led them to a more plausible way to look at the data, like silver, and hence better predictions. (ht georgy egorov though i may not be doing justice to his point.) talk cheaplytweet friday music: bad plus, “everybody wants to rule the world” november 18, 2016 in uncategorized | by sandeep baliga | leave a comment talk cheaplytweet trumprediction: most likely outcome for trump presidency november 16, 2016 in trumprediction | by sandeep baliga | leave a comment the most likely outcome for the trump presidency is that it will   bush  2.0 with some trumpian twists. specifically: tax cuts for the wealthy: no brainer rolling back financial regulation: no-brainer comeuppance for 1 and 2: either another bubble like 2008 or huge deficits leading eventually to a tax increase (like reagan to (h.w.) bush). another war: trump is thin-skinned and hence a prime candidate for manipulation by terrorists who seek to escalate conflict. so, another war beckons. probably, syria in a coalition with putin. trumpian twists: construction: trump is will try to build roads, bridges, infrastructure etc. this is an anathema to paul ryan et al. they will try to prevent this so not clear how much will happen. democrats of course will be into this and will try to help trump achieve it. russia expansion: putin will co-opt baltic states. nato will not defend hence this will be the end of nato credibility. trade: token tariffs will be imposed. maybe carrier air conditioner will be made into an example. but given threat of retaliation by trading partners, ryan/mcconnell will dampen trade controls. whatever happens, there will be little impact on jobs as technological change means fewer workers needed in manufacturing. the wall: he will build a tall but small wall. tv crews will film it. construction will stop but trump will lie and say he built whole thing. racism will go up: no-brainer. talk cheaplytweet trumprediction: nuclear proliferation november 15, 2016 in trumprediction | by sandeep baliga | leave a comment president-elect trump main framework for organizing human interaction is the zero-sum game. if he gives you anything, he wants something in return. he will soon be able to apply this deal-making philosophy to our strategic partners like japan and south korea. we can measure the costs of the bases, the personnel and the nuclear weapons that are helping given them security. the benefits – stopping nuclear proliferation – are hard to measure. are we giving them something for free? that is trump’s perspective it seems. can he get a better deal? if not, why not let these countries go nuclear? from the perspective of out strategic partners, if the us is not holding them up, why not go nuclear? so, chances are, we will see nuclear proliferation among our “allies” in the trump presidency. talk cheaplytweet evangelicals can delete dominated strategies but greens cannot november 14, 2016 in uncategorized | by sandeep baliga | 1 comment evangelical christians knew who trump was, had seen the videos and ads and yet still voted for trump. their main issue is the make-up of the supreme court and trump gave them a list of potential nominees they liked . he was more likely to choose an anti-abortion justice than hillary. so, the vast majority worked out their constrained optimal choice and went for it. greens could register a protest vote for jill stein in the election or choose between one of two electable candidates. no doubt, jill, if elected, would have tried to implement a first-best environmental policy (and failed to get it past a republican congress) but realistically it was choice between hillary getting nothing done or trump ripping up the obama legacy. the obvious legacy of interest to greens is the paris agreement and this is now the paris disagreement. and in michigan and wisconsin, hillary’s margin of loss is smaller than jill stein’s vote. of course, this is not enough – robby mook would have to have had the foresight to get beyonce to come to philly not cleveland. so why are evangelicals better than greens at this kind of reasoning? are greens just crazier? my colleague jorg spenkuch found a clever way to measure the fraction of crazy greens in germany – i think he finds it is 60%. not sure if he has a way to measuring crazy german evangelicals (if they exist)! another theory would be based on learning. evangelicals have been around the block a while and have learned the optimal strategy but greens have not. but a counterargument is the gore vs bush florida battle where ralph nader played a crucial role. surely the greens voters could remember having screwed up the election of the person who would have been the best president on the environment ever? i parry this thrust by positing the greens who voted for jill stein are so young that bush v gore is not part of their recalled history. talk cheaplytweet friday music november 11, 2016 in uncategorized | by sandeep baliga | leave a comment ht krugman talk cheaplytweet trumprediction: isis november 10, 2016 in trumprediction | by sandeep baliga | leave a comment i was discussing some forecasts of what might befall under a trump presidency with a friend. he was skeptical of one of them but it turns out henry kissinger agrees with me: jg: so there is some chance of more instability. hk: i would make a general statement: i think most of the world’s foreign policy has been in suspense for six to nine months, waiting for the outcome of our election. they have just watched us undergo a domestic revolution. they will want to study it for some period. but at some point, events will necessitate decision making once more. the only exception to this rule may be nonstate groups; they may have an incentive to provoke an american reaction that undermines our global position. jg: the threat from isis is more serious now? hk: nonstate groups may make the assessment that trump will react to a terror attack in a way that suits their purposes. talk cheaplytweet forecaster horse race november 5, 2016 in uncategorized | by jeff | 4 comments how do you assess whether a probabilistic forecast was successful?  put aside the question of sequential forecasts updated over time.  that’s a puzzle in itself but on monday night each forecaster will have its final probability estimate and there remains the question of deciding, on wednesday morning, which one was “right.” give no credibility to pronouncements by, say 538, that they correctly forecasted x out of 50 states.  according to 538’s own model these are not independent events.  indeed the distinctive feature of 538’s election model is that the statewide errors are highly correlated.  that’s why they are putting trump’s chances at 35% as of today when a forecast based on independence would put that probability closer to 1% based on the large number of states where clinton has a significant (marginal) probability of winning. so for 538 especially (but really for all the forecasters that assume even moderate correlation) tuesday’s election is one data point.  if i tell you the chance of a coin coming up armageddon tails is 35%, you toss it once and it comes up tails you certainly have not proven me right. the best we can do is set up a horserace among the many forecasters.  the question is how do you decide which forecaster was “more right” based on tuesday’s outcome?  of course if trump wins then 538 was more right than every other forecaster but we do have more to go on than just the binary outcome. each forecaster’s model defines a probability distribution over electoral maps. indeed they produce their estimates by simulating their models to generate that distribution and then just count the fraction of maps that come out with an electoral win for trump.  the outcome on tuesday will be a map.  and we can ask based on that map who was more right. what yardstick should be used?  i propose maximum likelihood.  each forecaster on monday night should publish their final forecasted distribution of maps.  then on wednesday morning we ask which forecaster assigned the highest probability to the realized map. that’s not the only way to do it of course, but (if you are listening 538, etc) whatever criterion they are going to use to decide whether their model was a success they should announce it in advance. talk cheaplytweet economics nobel 2016: oliver hart and bengt holmstrom october 10, 2016 in uncategorized | by sandeep baliga | 1 comment it was great to wake up this morning and find that oliver hart and bengt holmström were awarded the nobel prize in economics for 2016. their research is the bread and butter of modern economic theory and hence is taught in all first-year phd microeconomics courses and more applied versions are taught to mbas in electives on organizational economics. let me begin with the work of bengt holmström. the prize announcement begins with his work on the principal-agent model with moral hazard: an agent privately chooses an action that impacts the welfare of a principal. the principal observes noisy signals of the action and rewards the agent as a function of the signals to align incentives. holmström asks: which variables should be included by the principal is her performance measure and which should be omitted? in the “sufficient statistic” result, he shows that variables should be included if and only if they contain information about the action. adding more signals into a performance measure would add superfluous noise into payments which the a risk-averse agent would have to be compensated for. on the other hand, subtracting informative signals from a performance would eliminate useful information for aligning incentives. this result poses a puzzle which bengt turns to in later work: real-world contracts are rarely as complex as the informativeness principle would suggest. why is that the case? in joint work with paul milgrom, holmström introduced the multi-task principal agent model. the main innovation was to allow the agent to perform multiple tasks and to substitute from one to the other. holmström and milgrom show that in certain circumstances it is better not to may pay responsive to performance. suppose someone working in a fast food restaurant can look after the kitchen or sell burgers. burger sales are measurable but time spent looking after the kitchen is not. then making pay depend on burger sales can backfire as the agent substitutes away from looking after the kitchen. better to have low-powered incentives which are relatively flat in burger sales. bengt has made at least two other seminal contributions to moral hazard models. in his work on moral hazard in teams he shows that it might be impossible achieve total value maximizing outcomes when joint output is measurable but individual output is not. in his career concerns model, he shows that an agent trying to prove he is high ability to a market might work too hard at the start of his career and then tail off at the end. all these papers are workhorses of applied theory. they show holmström’s flair of coming up with models that serve as vehicles for others to make interesting contributions to understanding incentives. i want to end my appreciation of bengt holmström by pointing out that several of these papers were written when he was an assistant professor in the meds department at kellogg. roger myerson has already won a nobel prize for the work he did when he was in meds. oliver hart took contract theory in a different direction by emphasizing the role of property rights. in the principal-agent model, the principal might be an employer and the agent an employee. or the principal might be one firm and the agent an independent subcontracter. in other words, the model cannot address the question of when trade should take place within a firm or across two firms. building on some informal ideas of oliver williamson, oliver hart with sandy grossman and john moore used the idea that contracts are incomplete to offer a unified theory of the optimal allocation of property rights. the key idea is that ownership of an asset confers residual rights of control so you can use it for production should a relationship break down. suppose a buyer and a seller are trading a widget. they can both invest ex ante to increase the value of trade but because contracts are incomplete they must haggle over the price ex post. this means both are subject to hold-up: the benefit of any costly investment is shared with the other trading party. hence, both will underinvest. this underinvestment is mitigated by the fact that if a player owns an asset he can use it to trade with others so at least he can capture some value from his investment. so, if one player’s investment is particularly important for value creation he should be own all the assets and employ the other – so we have an integrated firm. if both players’ investments are important, then they should both own assets and then we have trade across two independent firms. debt and equity confer decision rights in different ways. so, oliver hart’s way of looking at control rights has proved to be very fruitful in corporate finance. but there is a lot to be done. in particular, without a theory of why contracts are incomplete there is a tension between the lessons of mechanism design and the ideas in grossman-hart-moore. this tension was pointed out by maskin and tirole. eric maskin was my phd advisor at harvard and oliver arrived at harvard just as i graduated. at that point, my friend, co-author and advisor tomas sjöström, who was sitting at the podium during the announcement as he is on the nobel committee, was an assistant professor at harvard and i would visit to work with him. we became interested in oliver’s ideas and also knew of the maskin-tirole critique. so, tomas and i wrote a few papers studying optimal decision rights when agents can collude or renegotiate inefficient outcomes without falling afoul of the maskin-tirole critique. i continue to work on these questions still. i would never have worked on those papers without oliver’s seminal insights to build on. so, i am particularly happy personally with this prize. talk cheaplytweet should republicans dump trump – a backward induction argument august 5, 2016 in uncategorized | by sandeep baliga | 1 comment trump excites the “base” but not independents or traditional republicans who believe in free markets etc. the temptation for congressional republicans up for election is to use “strategic ambiguity” and have their cake and eat it. that is, say you support the republican presidential nominee but not embrace his positions, e.g like ayotte and mccain. this way, you hope ticket-splitters vote for you to check and balance hillary. unfortunately, obama moves second. he will say trump is unfit to be president, is not a republican and will tar supporters with the same brush. this way he will seek to slice off the base vote from the non-base. a vote for a supporter is a vote for trump. how will they check and balance a demagogue when they are not splitting with him now? also – and somewhat unexpectedly – trump is helping obama out here by refusing to endorse congressional republicans employing strategic ambiguity. he refuses to endorse ayotte and mccain because of criticisms etc. hence,he is signaling to his base not to support them (not sure if his strategy makes sense but i will take him at face value). so, on the one hand, obama will attack anyone on the fence by saying they support trump (hoping to peel off independents, “real” republicans and ticket-splitters) and trump will attack anyone on the fence by saying they do not support him (hoping his base will not support them?!!). so, strategic ambiguity is going to backfire so you have to pick a side. which side? can you win if you support him and he loses your state? if the answer is a likely yes, you support trump (e.g. rubio) and if it is a no, you dump trump. the more likely your state is to go for hillary, the more plausible your “i will check and balance hillary” argument and the less costly it is to dump trump. hence, toomey and ayotte are likely in this category. if the state is 50-50 like az, your choice is difficult, eg mccain, but you have to pick a side otherwise both may not vote for you. talk cheaplytweet thoughts left lying around about election forecasts july 21, 2016 in uncategorized | by jeff | 3 comments suppose one forecaster says the probability trump wins is q and the other says the probability is p>q.  if trump in fact wins, who was “right?” suppose one forecaster says the probability is q and the other says the probability is 100%.  if trump in fact wins, who was right? suppose one forecaster said q in july and then revised to p in october.  the other said q’ < q in july but then also revised to p in october.  who was right? suppose one forecaster continually revised their probabilistic forecast then ultimately settled on p<1.  the other forecaster steadfastly insisted the probability was 1 from beginning to end.  trump wins.  who was right? suppose one forecaster’s probability estimates follow a martingale (as the laws of probability say that a true probability must do) and settles on a forecast of q.  the other forecaster‘s “probability estimates” have a predictable trend and eventually settles on a forecast of q’>q.  trump wins.  who was right? suppose there are infinitely many forecasters so that for every possible sequence of events there is at least one forecaster who predicted it with certainty.  is that forecaster right? talk cheaplytweet henry viii and brexit june 27, 2016 in art of office politics, banana seeds, tongue in cheek, vapor mill | by sandeep baliga | 3 comments henry viii (the right-wing of the tory party) wanted to divorce his first wife (the eu) and marry anne boleyn (stop immigration and transfer payments to the eu ) but the catholic church (angela merkel) would not let him. so, he renounced catholicism and became a protestant, a new form of christianity conceived by martin luther (nigel farage). but then mary queen of scots (nicola sturgeon), a catholic, married a french prince when elizabeth i (boris johnson) eventually came to the throne. mary got beheaded and the elizabeth’s reign turned out pretty well. but here boris’s and elizabeth’s paths diverge. the protestant reformation was forward looking and emphasized the work ethic. faragism – to the extent it is a philosophy – is backward-looking and is about denying globalization. not clear then who gets beheaded, boris or nicola. talk cheaplytweet trumpellence and the donald’s optimal strategy june 16, 2016 in art of office politics, tongue in cheek, vapor mill | tags: current events, incentives | by sandeep baliga | 1 comment trump is the principal and a republican congress member is the agent. trump wants their support and wants to compel them to support him. there is no money to align incentives and all trump can do is shower with praise (e.g. people who cave in to him are “brave” like megyn kelly who went to visit him in trump tower after their dustup) or rain down abuse (e.g. the republican governor martinez of new mexico who dared to text during one of his speeches). from the agent perspective, since there is no money, there is only re-election probability. this leads to two cases. in one case, the agents reelection probability is increasing in being seen as pro-trump. then, trump should allocate praise and abuse in the natural way. in the other case, the agent’s re-election probability is decreasing in being seen as pro-trump but trump would still like republican support to increases his election chances. then, trump should visit the agent’s district if the agent does not support trump. he should say the agent is brave and lie and say the agent does support him. this threat maximizes compellence. marco rubio provides the most interesting example. he has lumped in with trump as he decides whether to run for re-election. if he throws his hat into the ring and trump’s polls tank in florida, donald should threaten to campaign there heavily if rubio shows signs of weakening in his support of trump. talk cheaplytweet why you don’t see ads for american idol on abc april 7, 2016 in uncategorized | by jeff | 7 comments what i wrote yesterday: when fox broadcasts the super bowl they advertise for their shows, like american idol. but those years in which, say, abc has the super bowl you will never see an ad for american idol during the super bowl broadcast. this is that sort of puzzle whose degree of puzzliness is non-monotonic in how good your economic intuition is. if you don’t think of it in economic terms at all it doesn’t seem at all like a puzzle. try it: ask your grandpa if he thinks that its odd that you never see networks advertising their shows on other networks.  of course they don’t do that. when you apply a little economics to it that’s when it starts to look like a puzzle. there is a price for advertising. the value of the ad is either higher or lower than the price. if its higher you advertise.  if its another network that price is the cost of advertising. if its your own network that price is still a cost: the opportunity cost is the price you would earn if instead you sold the ad to a third-party.  if it was worth it to advertise american idol when your own network has the super bowl then it should be worth it when some other network has it too. but a little more economics removes the puzzle.  networks have market power.  the way to use that market power for profit is to artificially restrict quantity and set price above marginal cost. (the marginal cost of running another 30 second ad is the cost in terms of viewership that would come from shortening, say, the halftime show by 30 seconds.) when a network chooses whether to run an ad for its own show on its own super bowl broadcast it compares the value of the ad to that marginal cost.  when a network chooses whether to run an ad on another network’s super bowl broadcast it compares the value to the price. indeed even if the total time for ads is given and not under control of the network (i.e. total quantity is fixed) the profit maximizing price for ads will typically only sell a fraction of that ad time.  then the marginal (opportunity) cost of the additional ads to pad that time is zero and even very low value ads like for american idol will be shown when fox has the super bowl and not when any other network does. in fact that last observation and the fact that you never ever see any network advertise its shows on another network tells us that the value of advertising television shows is very low.  perhaps that in fact tells us that the networks themselves understand (but their paying advertisers don’t) that the value of advertising in general is very low. talk cheaplytweet i think i finally figured it out april 6, 2016 in uncategorized | by jeff | 2 comments when fox broadcasts the super bowl they advertise for their shows, like american idol. but those years in which, say, abc has the super bowl you will never see an ad for american idol during the super bowl broadcast. more generally, networks advertise their own shows on their own network but never pay to advertise their shows on other networks.  i never understood this.  but i think i finally figured it out, there’s some very simple economics behind this. talk cheaplytweet what the contested convention odds tell us april 6, 2016 in uncategorized | by jeff | 4 comments right now at primary.guide, you can read the current betting market odds for a “contested convention” and a “brokered convention.”  the definitions are as follows.  a contested convention means that no candidate has 1237 delegates by the end of the last primary.  a brokered convention means that no candidate wins on the first ballot at the convention. right now the odds of a brokered convention are 50%.  note also that the odds of a trump nomination are 50% as well.  and trump is the only candidate with any chance of winning a majority on the first ballot (even if he doesn’t get 1237 bound delegates he will be close and no other candidate could combine their bound delegates with unbound delegates to get to a majority.) thus, if there is no brokered convention trump is the nominee.  the probability of no brokered convention is 50%.  thus the entire 50% probability of a trump nomination is accounted for by the event that he wins on the first ballot. in other words there is zero probability, according to betting markets, that trump wins a brokered convention. the odds of a contested convention are 80%. that means that betting markets think there is a 30% chance trump fails to get 1237 bound delegates but still wins on the first round.  i.e. according to betting markets we have the following three mutually exclusive events: trump gets to 1237 by june 7.  20% odds trump fails to get 1237 bound delegates but wins on the first ballot.  30% nobody wins on the first ballot and trump is not the nominee.  50% talk cheaplytweet who is the best republican presidential candidate for congressional republicans? march 16, 2016 in uncategorized | by sandeep baliga | leave a comment donald trump: you are a lifelong republican and think trump is not a conservative. you would never vote for him. you go into the voting both and see clinton’s name and trump’s name. what do you do? either you bite the bullet and vote for clinton or you abstain. either way you have increased the probability that hillary wins – ok not by much but since you are in the voting booth in the first place, you’re not a fully rational voter and so you care about the infinitesimal impact you have. so, you decide to make sure she’s hamstrung by a republican congress. you vote for the republican congressional candidates. you would vote for cruz but suspect he is a bit nuts. you vote for the democratic congressional candidates to make sure cruz is ineffective. (kasich would actually be best all round but has no chance of making it.) talk cheaplytweet negative campaigning in multi-candidate elections february 10, 2016 in uncategorized | by sandeep baliga | 4 comments suppose politician c goes negative on politician m. politician’s m’s support declines..where do his supporters go? if there are just two candidates, they either go to politician c or stay at home. but if there are three or more candidates, they might go to politician a, b, or k etc etc. so, to a first order, it is less profitable to go negative the greater the number of candidates. this resembles the holmstrom teams model but with unproductive effort. talk cheaplytweet the establishment gop needs approval voting in the primaries february 8, 2016 in uncategorized | by sandeep baliga | leave a comment from buzzfeed: henniker, new hampshire — in town halls, pizzerias, and high school auditoriums, hundreds of voters are carefully evaluating the three governors who have pinned their presidential hopes on tuesday’s primary in the granite state — jeb bush, chris christie, and john kasich. some have made their choice of the three; others are still undecided. but they all agree on one big thing: the republican party needs a strong contender coming out of new hampshire to take down donald trump. with the stakes so high, these “non-angry voters,” as described by some, are wrestling with whether to ultimately vote for their personal favorite — one of the three governors, or go by the polls in favor of a more practical favorite, sen. marco rubio. perhaps the gop should adopt approval voting as suggested by my colleague bob weber where each voter can “approve” as many candidates as he likes. of course, ted cruz and donald trump would disapprove or approval voting. talk cheaplytweet isil and its confused strategy november 17, 2015 in war | by sandeep baliga | 1 comment isil has taken war out of the middle east by bombing a russian plane and attacking paris. these attacks follow increased russian and western involvement in syria. what was the purpose of these attacks? it is useful to examine two polar opposite cases : isil’s acts seek to provoke or seek to deter. if they seek to provoke, the best case scenario for isil is that russia and the west respond by repressing muslims domestically. this anti-muslim fervor will generate propaganda that is useful for recruitment. but of course, the attacks will provoke a strong counter-response by france, russia and their allies in syria. finally, a russia-western coalition may even come into being. al qaeda’s diminished fate then awaits isil. a provocation cannot be targeted into only a domestic response and the international response will be so dramatic as to counterbalance any domestic response though, of course, it would also be wise not to give in to the temptation to cave in to anti-muslim fervor. if isil seek to deter – i.e. they are making us pay a price for increased involvement in syria and giving us an incentive to retreat – well that’s totally going to backfire. the french, british and russians are more likely to engage than less as i said above. in this case, isil’s strategy would be a complete misreading of the situation. so, either way, the isil strategy is going to fail. talk cheaplytweet what i like about kellogg… november 3, 2015 in uncategorized | by sandeep baliga | leave a comment my colleagues are multi-talented: robert mcdonald, associate dean for faculty, and jeff cohen performing “here comes the weekend” by dave edmunds and nick lowe and “what’s so funny about peace, love and understanding?” by nick lowe. ht: bob mcdonald for telling me first song is also by dave edmunds. talk cheaplytweet top posts why is it a crime to park facing the wrong way? 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