December 5, 2011

Moral hazard invades the scientific sphere

Filed under: Economics, Government, Media, Science — Tags: , , — Nicholas @ 12:23

Bill Frezza looks at an unanticipated consequence of pouring more government money into the sciences:

Science and the scientific method are the jewels in the crown of Western civilization. The ascertainment of facts, construction of reproducible experiments, development of falsifiable theories, impartial training and meritocratic advancement of practitioners, and — most importantly — integrity of the publication process by which a well established body of truth can be confidently assembled all underpin the respect accorded to science by the citizenry. In modern times, this respect translates into tax dollars.

Unfortunately, today those tax dollars are corrupting the process. Unprecedented billions are doled out by unaccountable federal and state bureaucracies run by and for the benefit of a closed guild of practitioners. This has created a moral hazard to scientific integrity no less threatening than the moral hazard to financial integrity that recently destroyed our banking system.

According to a report in Nature Reviews Drug Discovery, nearly two-thirds of the experimental results published in peer-reviewed journals could not be reproduced in Bayer’s labs. The latest special issue of Science is devoted to the growing problem of irreproducibility. The Wall Street Journal reports that Amgen, Pfizer, and others have abandoned research programs after spending hundreds of millions pursuing academic research that could never be replicated.

H/T again to Monty for the link.

Why GM is very worried about the reported battery fire risk in the Chevy Volt

Filed under: Economics, Technology, USA — Tags: , , , — Nicholas @ 12:13

If you’ve been following the blog for a while, you’ll know I’m not over-optimistic about electric cars in the short-to-medium term (for example, here, here, here, and here) and I’m especially underwhelmed with GM’s most recent offering, the Chevy Volt:

Let’s talk economics first. Electric and hybrid-electric vehicles are more expensive to make and bring in less profit than other cars. They cost more to finance, more to repair, and more to insure. Their sales depend heavily on tax incentives, which means that selling more of them will require more taxpayer dollars. The National Renewable Energy Laboratory (NREL) estimates that plug-in hybrid vehicles cost $3,000 to $7,000 more than regular hybrids, even though the performance differences between the two models are slight, and the really fuel-efficient hybrids cost $12,000 to $18,000 more than the conventional brand. Consider the GM Volt. When it was first announced, the price estimate from General Motors (GM) was $30,000. That soon jumped to $35,000. Today, they sell for nearly $40,000.

Hybrids are also more expensive to insure, which has been known for some time. Back in 2008, online insurance broker Insure.com showed that it cost $1,374 to insure a Honda Civic but $1,427 to insure a Honda Civic Hybrid. Similarly, it cost $1,304 to insure a Toyota Camry but $1,628 to insure a Toyota Camry Hybrid. According to State Farm, hybrids cost more to insure because their parts are more expensive and repairing them requires specialized labor, thus boosting the after-accident payout.

And that, of course, presumes they don’t burst into flames, which brings us to today’s not-so-“ideal” headlines. Several crash tests have suggested that the plug-in hybrid Volt, the flagship vehicle at Government Motors, has a bit of a problem: when hit or badly disturbed in accident tests, the Volt’s Lithium-Ion (Li-ion) battery packs have been seen to spark, or burst into flames afterward.

H/T to Monty.

Debunking memes: the Gini co-efficient as a spark for rioting

Filed under: Britain, Economics, France, Media — Tags: , , , — Nicholas @ 08:33

Theodore Dalrymple shows that the widespread habit of journalists in Britain to attempt to attribute the root cause of August riots to the Gini co-efficient fails the common-sense test:

An August feature story on the riots in Time offered a particularly striking example. The author suggested that to understand the riots, we should start with “something called the Gini co-efficient, a figure used by economists to indicate how equally (or unequally) income is distributed across a population.” In this traditional measure, the article notes, Britain fares worse than almost every other country in the West.

This little passage is interesting for at least two reasons. First is the unthinking assumption that more equality is better; complete equality would presumably be best. Second is that the author apparently did not think carefully about the table of Gini coefficients printed on the very same page and what it implied about his claim. Portugal headed the list as the most unequal of the countries selected, with a 0.36 coefficient. Next followed the U.K. and Italy, both with a 0.34 coefficient. Toward the bottom of the list, one found France, with a 0.29 coefficient, the same as the Netherlands. Now, it is true that journalists are not historians and that, for professional reasons, their time horizons are often limited to the period between the last edition of their publication and the next. Even so, one might have expected a Time reporter to remember that in 2005 — not exactly a historical epoch ago — similar riots swept France, even though its Gini coefficient was already lower than Britain’s. (Having segregated its welfare dependents geographically, though, France saw none of its town or city centers affected by the disorder.)

As it happened, when I read the Time story, I had an old notebook with me. In it, among miscellaneous scribblings, was the following list, referring to the riots in France and made contemporaneously:

    Cities affected 300
    Detained 2,921
    Imprisoned 590
    Burned cars 9,071
    Injured 126
    Dead 1
    Police involved 11,200
    Average number of cars burned per day before riots 98

And all this with a Gini coefficient of only 0.29! How, then, could it have happened? It might also be worth mentioning that the Netherlands, with its relatively virtuous Gini coefficient, is one of the most crime-ridden countries in Western Europe, as is Sweden, with an even lower Gini coefficient.

Vikings lose 35-32 to Denver Broncos

Filed under: Football — Tags: , , , , — Nicholas @ 08:15

If nothing else, it was a far more entertaining game than anyone expected. Percy Harvin had a career day, Kyle Rudolph had a highlight reel catch for a touchdown, and Devin Aromashodu stepped up and had a great day receiving. Christian Ponder set a new Vikings record for passing yards by a rookie quarterback, but also threw the game-sealing interception in the final minutes.

Aside from two bad decisions, Ponder played well enough to win and the Vikings could have won the game if the secondary had played even slightly better. Missing three of their top four cornerbacks, and two of their top three safeties, the secondary is cover-your-eyes awful. It’s hard to express just how wide-open Denver’s receivers were during the game. Tebow didn’t have to throw anything difficult, because the Vikings weren’t covering his receivers.


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