Joswald1

From my review today in the WSJ of Innovation Breakdown by Joseph Gulfo:

Yo is a smartphone app. MelaFind is a medical device. Yo sends one meaningless message: “Yo!” MelaFind tells you: “biopsy this and don’t biopsy that.” MelaFind saves lives. Yo does not. Guess which firm found it easier to put their product in consumers hands? Oy.

In “Innovation Breakdown: How the FDA and Wall Street Cripple Medical Advances,” Joseph Gulfo tells the tumultuous history of MELA Sciences, the company that invented MelaFind. When Dr. Gulfo joined the firm as president and CEO in 2004, the company’s brilliant team of scientists had spent many years and tens of millions of dollars to develop MelaFind, a “camera with a brain”—optical technology that would scan potential melanomas in multiple spectra and then, using sophisticated algorithms and large datasets, diagnose which were most likely to be cancerous.

MELA Sciences conducts an extensive clinical trial according to a protocol agreed on by the FDA and all looks good. After the clinical trial is completed, however, the FDA backs away from the protocol and comes out against MelaFind.

…The title of Dr. Gulfo’s book is “Innovation Breakdown” but “Innovator’s Breakdown” might have been more apt. The letter sent the author into survival mode. He battled the FDA, calmed investors, and defended against the lawsuit all while trying to keep the company afloat. Under stress, Dr. Gulfo’s health began to decline: He lost 29 pounds, his hair began to fall out, and the pain in his gut became so intense he needed an endoscopy. When his wife begged him to quit, he refused. They turned into roommates. “We were nothing more than cordial. I basically shut my wife out of my life,” he writes.

…The climax to this medical thriller comes when, in “the greatest 15 minutes of [his] life,” Dr. Gulfo delivers an impassioned speech, à la “Twelve Angry Men,” to the FDA’s advisory committee. The committee voted for approval, 8 to 7, and, perhaps with the congressional hearing in mind, the FDA approved MelaFind in September 2011.

It was a major triumph for the company, but Dr. Gulfo was beat. He retired from the company in June 2013—just in time to save his marriage.

Yet remarkably, given his experience, Mr. Gulfo writes that he still believes in a strong FDA. He argues in the book that better “leadership” and a few tweaks to existing rules can fix the problem. He’s wrong.

Compare MelaFind’s experience in the U.S. with its reception in Europe: MelaFind was submitted for marketing approval in Europe in May 2011. It was approved just five months later. One key reason for Europe’s efficient approval process is that European governments don’t review medical devices directly. Instead they certify independent “notified bodies” that specialize and compete to review new products. The European system works more quickly than the U.S. system, and there is no evidence that it results in reduced patient safety. Rather than tweak the current system, why doesn’t the U.S. just adopt the European model and call it a day? Our health and our economy would be better off for it.

Google’s Sergey Brin recently said that he didn’t want to be a health entrepreneur because “It’s just a painful business to be in . . . the regulatory burden in the U.S. is so high that I think it would dissuade a lot of entrepreneurs.” Mr. Brin won’t find anything in Dr. Gulfo’s book to persuade him otherwise. Until we get our regulatory system in order, expect a lot more Yo’s and not enough life-saving innovations.

Another exclusive comic at The Nib!

Julia Lepetit of Dorkly has created a series of illustrations that visualize the great life lessons that we can learn from video games. The entire collection of illustrations can be viewed at Dorkly.

images via Dorkly

From Becker, Philipson, and Soares (pdf):

GDP per capita is usually used to proxy for the quality of life of individuals living in different countries. Welfare is also affected by quantity of life, however, as represented by longevity. This paper incorporates longevity into an overall assessment of the evolution of cross-country inequality and shows that it is quantitatively important. The absence of reduction in cross-country inequality up to the 1990s documented in previous work is in stark contrast to the reduction in inequality after incorporating gains in longevity. Throughout the post–World War II period, health contributed to reduce significantly welfare inequality across countries. This paper derives valuation formulas for infra-marginal changes in longevity and computes a “full” growth rate that incorporates the gains in health experienced by 96 countries for the period between 1960 and 2000. Incorporating longevity gains changes traditional results; countries starting with lower income tended to grow faster than countries starting with higher income. We estimate an average yearly growth in “full income” of 4.1 percent for the poorest 50 percent of countries in 1960, of which 1.7 percentage points are due to health, as opposed to a growth of 2.6 percent for the richest 50 percent of countries, of which only 0.4 percentage points are due to health. Additionally, we decompose changes in life expectancy into changes attributable to 13 broad groups of causes of death and three age groups. We show that mortality from infectious, respiratory, and digestive diseases, congenital, perinatal, and “ill-defined” conditions, mostly concentrated before age 20 and between ages 20 and 50, is responsible for most of the reduction in life expectancy inequality. At the same time, the recent effect of AIDS, together with reductions in mortality after age 50—due to nervous system, senses organs, heart and circulatory diseases—contributed to increase health inequality across countries.

That reminder is from Aaron Schwartz.  And of course that is the Becker, yet another contribution from Gary Becker.

Do note, by the way, that medical progress is usually egalitarian per se.  A common metric is something like “health outcomes of the poor” vs. “health outcomes of the rich,” and that may or may not be moving in an egalitarian direction.  But very often the more incisive metric is “health outcomes of the sick” vs. “health outcomes of the healthy,” and of course most medical treatments are going to the sick.  The more desperate is the lot of the sick, the more likely that medical progress is egalitarian per se.

Why do we even bishop?

To those patrons patiently awaiting their signed prints and raffle prizes, please hang in there! You haven’t been forgotten – it’s just taking some time to get things right. Plus I’m still pounding out the clerihews – though there are only about eleven left to go at the time of writing.

(If you don’t know what I’m talking about, you can read all about it here.)

Why not become a Patron of the Blasphemous Arts? Book shop here

Back in February, Smug Mode chose American counterparts for all of Doctor Who's past incarnations. We're talking Dick Van Dyke as the 2nd Doctor, Gene Wilder for the 4th Doctor, and Donald Glover as the 11th Doctor. Here's a nicely done faux 50th anniversary video celebrating those Doctors:

(via @moth)

Tags: Doctor Who   parody   TV   video

There is a new NBER paper by Scott Cunningham and Manisha Shah:

Most governments in the world including the United States prohibit prostitution. Given these types of laws rarely change and are fairly uniform across regions, our knowledge about the impact of decriminalizing sex work is largely conjectural. We exploit the fact that a Rhode Island District Court judge unexpectedly decriminalized indoor prostitution in 2003 to provide the first causal estimates of the impact of decriminalization on the composition of the sex market, rape offenses, and sexually transmitted infection outcomes. Not surprisingly, we find that decriminalization increased the size of the indoor market. However, we also find that decriminalization caused both forcible rape offenses and gonorrhea incidence to decline for the overall population. Our synthetic control model finds 824 fewer reported rape offenses (31 percent decrease) and 1,035 fewer cases of female gonorrhea (39 percent decrease) from 2004 to 2009.

Alas, I do not see ungated versions on Google, or maybe try this one (pdf).

Activists tell of ‘being travelled’ – sent on lavish trips, chaperoned by police – to keep them out of the government’s way.

As top Communist leaders gathered in Beijing the veteran Chinese political activist He Depu was obliged to leave town – on an all-expenses-paid holiday to the tropical island of Hainan, complete with police escorts.

It is an unusual method of muzzling dissent, but He is one of dozens of campaigners who rights groups say have been forced to take vacations – sometimes featuring luxurious hotels beside sun-drenched beaches, trips to tourist sites and lavish dinners – courtesy of the authorities.

It happens so often that dissidents have coined a phrase for it: “being travelled”.

He, 57, had not been charged with any crime but officers took him 1,400 miles (2,300km) to Hainan for 10 days to ensure he was not in the capital for this year’s annual meeting of China’s legislature, he said.

Two policemen accompanied him, his wife and another dissident for dips in the ocean and visits to a large Buddha statue, he said.

“We had a pretty good time because a decent amount of money was spent on the trip – the local government paid for everything.”

Altogether eight activists have told Agence France-Presse of being forced on holiday in recent years.

The pointer is from Mark Thorson.

Alan Taylor has concluded his 10-part series on WWI over at In Focus with a look at the present-day effects of the war. If you haven't been following along, it's worth starting at the beginning and working your way through.

Also worth a look is the NY Times' interactive package about the war.

Tags: Alan Taylor   photography   World War I

I like to experience aesthetic extremes, so it is appropriate I ended up sitting through this one.  It is perhaps the most beautifully choreographed movie I have seen — ever — with one perfectly arranged ninety second sequence after another, in seamless fashion yet summed into something quite incoherent and meaningless and indeed even obnoxious at times.  But did L’Avventura make much sense either?  (And like L’Avventura, Transformers 4 is way too long.)  Michael Nielsen was correct in his advice to view this new release as an art film.

The movie poses the question of how the world would look if technologies of defense were no longer clearly superior to technologies of offense.  The public choice answer seems to be that power shifts away from the Presidency, to the intelligence agencies, and to intellectual property holders, at least as first order effects.  Output is reallocated toward rural areas.

The political subtext of the movie is indicated rather clearly by the eventual military alliance of the red, white, and blue-wearing Optimus Prime with the Chinese dragons, consummated in China of course.  Unlike with the recent Godzilla movie, Japan is not the main intended Asian audience.  The Hong Kong scenes are spectacular, but the film reaffirms the importance of “central government” (i.e., Beijing) control over Hong Kong in rather heavy-handed fashion.  (This is done so transparently you could call it an anti-Straussian move — “hey, let’s make sure we get those shooting rights in Hong Kong again!”)  You also get to see a Chinese guy beat up on the CIA, gratuitously, using some kind of traditional Chinese boxing technique.

I am still fond of this this review and this one too of an earlier installment.  If you are tempted, you probably should see this movie, but I am not sure you should feel tempted to feel tempted.

Facebook manipulated the emotions of hundreds of thousands of its users, and found that they would pass on happy or sad emotions, it has said. The experiment, for which researchers did not gain specific consent, has provoked criticism from users with privacy and ethical concerns.

For one week in 2012, Facebook skewed nearly 700,000 users’ news feeds to either be happier or sadder than normal. The experiment found that after the experiment was over users’ tended to post positive or negative comments according to the skew that was given to their newsfeed.

The research has provoked distress because of the manipulation involved.

Clearly plenty of ads try to manipulative us with positive emotions, and without telling us.  There are also plenty of sad songs, or for that matter sad movies and sad advertisements, again running an agenda for their own manipulative purposes.  Is the problem with Facebook its market power?  Or is the the sheer and unavoidable transparency of the notion that Facebook is inducing us to pass along similar emotions to our network of contacts, thus making us manipulators too, and in a way which is hard to us to avoid thinking about?  What would Robin Hanson say?

Note by the way that “The effect the study documents is very small, as little as one-tenth of a percent of an observed change.”  How much that eventually dwindles, explodes, or dampens out in the longer run I would say is still not known to us.  My intuition however is that we see a lot of longer-run dampening and also intertemporal substitution of emotions, meaning this is pretty close to a non-event.

The initial link is here.  The underlying study is here.  Other readings on the topic are here.

I hope you’re not too sad about this post [smiley face]!

thestarlingscalling:

Benedict Cumberbatch’s name

I was disappointed but not surprised by this passage by Gary Silverman:

What I like about Obamacare is that it shows some respect for “those people” – as Hudson called them in Giant – who are good enough to work the fields and mow the lawns, and build the roads and sew the clothes, and diaper the babies and wash the dishes, but somehow aren’t good enough to see a doctor from time to time to make sure there is nothing wrong inside.

That is in fact what most of politics is about, namely debates over which groups should enjoy higher social status and which groups should receive lower social status.  Of course critics of Obamacare have their own versions of desired status reallocation, typically involving higher status for the economically productive.

Here is another example of the argument from sympathy, by Norman Podhoretz, applied to a very different field of discourse:

Provoked by the predictable collapse of the farcical negotiations forced by Secretary of State John Kerry on the Palestinians and the Israelis, I wish to make a confession: I have no sympathy—none—for the Palestinians. Furthermore, I do not believe they deserve any.

I am not in this post seeking to adjudicate ACA or U.S. policy in the Middle East.  The easy target is to go after these two authors, but I am interested in different game.  The deeper point is that virtually all of us argue this way, albeit with more subtlety.  A lot of the more innocuous-sounding arguments we use all the time come perilously close to committing the same fallacies as do these quite transparent and I would say quite obnoxious mistaken excerpts.  One of the best paths for becoming a good reader of economics and politics blog posts (and other material) is to learn when you are encountering these kinds of arguments in disguised form.

Does any sentence better illustrate the human condition in all its political, social and biological complexities than this sentence?

New York state lawmakers have passed a bill banning residents from taking “tiger selfies” — a rising trend on dating websites in which single men post photos of themselves posing with the ferocious felines in hopes of impressing potential mates.

Dissertations are waiting to be written.

(via @KBAndersen)

Tags: video

[Warning: Minor spoilers].

Just finished The Wolf of Wall St.   Though based on a true story, the ugly facts are usually easy to minimize: Most investment firms aren't run by stoned sociopaths, and most investment firms' customers make money.  But one ugly fact is hard to shrug off: people with a talent for high-pressure salesmanship often get rich.

Why does high-pressure salesmanship work?  Many economists will lazily invoke textbook asymmetric information.  High-pressure salesmanship works because... adverse selection.  High-pressure salesmanship works because... moral hazard.  High-pressure salesmanship works because... signaling. 

None of these textbook stories remotely makes sense.  Adverse selection, moral hazard, and signaling should all thwart high-pressure salesmen by making their potential clients wary.  "If your stocks are so great, why are you trying so desperately to sell them to me?"  "You probably get paid on commission, so I don't trust you."  "If you're so great at picking winners, convince me by giving me $500 in complimentary stock.  Call me back once my account doubles in value."  High theory aside, everyone knows how to avoid being fleeced by high-pressure salesmen: Utterly refuse to deal with them.  Hang up or walk out.

If standard economic theory can't explain the power of high-pressure salesmanship, what does?  Psychology, of course.  Some human beings make important decisions on emotional grounds - and most human beings dislike saying "no."  High-pressure salesmen carefully study and coldly prey upon these weaknesses.  The best high-pressure salesmen get rich - even though most of their customers would have been better off without them.

How can a libertarian say such things without having his head explode?  By the power of hypothetical reasoning.  High-pressure salesmanship and the human weakness that sustains it are hardly unique.  Human weakness is all around us - and whenever human weakness exists, there are craftier human being waiting to cash in.  Cult leaders cash in on believers' weakness.  Pick-up artists cash in on women's weakness.  Gold-diggers cash in on men's weakness.  Faith healers cash in on their patients' weakness.  Should government try to regulate all of these things?  No?  Then why should government regulate high-pressure salesmanship?

None of this means, of course, that I'm indifferent to these problems.  I'm all for voluntary remedies.  First and foremost: Urging everyone to consistently use the defensive strategies that everyone knows.  When you encounter a high-pressure salesman, cult leader, pick-up artist, gold-digger, or faith-healer, utterly refuse to deal with them.  Hang up or walk out.

Yes, you could call this "blaming the victim."  But when a wolf is eating sheep, preaching at the sheep is far more effective than preaching at the wolf.

P.S. Hope to see you at Capla-Con this weekend, where wolves and sheep alike can hone their social skills. :-)

(10 COMMENTS)

Spotted in @SebJabbusch's feed: a keyboard for conspiracy theorists, with lots of handy shortcuts: chemtrail, Nazi, HAARP, and, of course, Jews. (via Super Punch) (more…)

Local politicians and protesters are in a huff about foreign producers "dumping" steel on the US market. They're making the usual noise about protecting communities, foreigners "flooding" American markets, and so on.

If you're worried about losing your job because foreigners are "dumping" steel on the US market, or if you're worried that foreigners will jack up prices once they've eliminated American producers, here's how to profit from their nefarious strategy:

1. Take your savings and start stockpiling the steel that foreigners are producing below cost. Get a home equity line of credit or something and borrow money if you have to.

2. Once the foreigners decide to jack up the price, undercut them by selling your steel stockpiles. Pocket a handsome profit from the difference between the below-cost price you paid and the just-below-what-the-evil-foreigners-are-charging price at which you sell the steel.

3. If you have enough money to do it, keep buying steel until you drive the evil foreigners out of business. After all, they won't be able to sell steel at a loss forever. If they have to start raising prices, then you can match them or undercut them and make a pile of money. You might not be able to do it individually, but I'm sure US Steel or the steelworkers' union can mobilize the resources to make an impact.

4. If foreigners are systematically selling steel in the US below their domestic market price, buy as much steel as you can at the artificially-low price and then use the foreigners' own steel to undercut them in their domestic market.

5. A lot of people are worried that state and municipal governments won't be able to meet their pension obligations. If foreigners are dumping with an eye toward juicy future profits, the strategy outlined above could provide a windfall that would ensure solvency for states and municipalities for decades to come.

The fact that no one appears to be doing this combined with the fact that the proposals are cloaked in the language of fairness suggests to me that there's something fishy going on here. Here's Jagdish Bhagwati's article on "Protectionism" from The Concise Encyclopedia of Economics. It contains this choice quote from one analyst: "If the same anti-dumping laws applied to U.S. companies, every after-Christmas sale in the country would be banned."

(6 COMMENTS)

I have a new piece for The Upshot on that topic, here is one excerpt:

Counterintuitive though it may sound, the greater peacefulness of the world may make the attainment of higher rates of economic growth less urgent and thus less likely. This view does not claim that fighting wars improves economies, as of course the actual conflict brings death and destruction. The claim is also distinct from the Keynesian argument that preparing for war lifts government spending and puts people to work. Rather, the very possibility of war focuses the attention of governments on getting some basic decisions right — whether investing in science or simply liberalizing the economy. Such focus ends up improving a nation’s longer-run prospects.

It may seem repugnant to find a positive side to war in this regard, but a look at American history suggests we cannot dismiss the idea so easily. Fundamental innovations such as nuclear power, the computer and the modern aircraft were all pushed along by an American government eager to defeat the Axis powers or, later, to win the Cold War. The Internet was initially designed to help this country withstand a nuclear exchange, and Silicon Valley had its origins with military contracting, not today’s entrepreneurial social media start-ups. The Soviet launch of the Sputnik satellite spurred American interest in science and technology, to the benefit of later economic growth.

I also discuss new books by Ian Morris, Kwasi Kwarteng, and some research by my colleague Mark Koyama, as well as Azar Gat.  I did not have room in the piece to point out there is an interior solution concerning this issue.  That is, if the chance of war is too high, and property rights are too insecure, that isn’t good for economic growth either.

I've seen the waterfalls and the hot springs and the rocky desolation, but I didn't know that Iceland was also this:

I mean, come on. Photos by Max Rive, Menno Schaefer, and Johnathan Esper. Many more here. (via mr)

Tags: Iceland   photography

Time for more Twitters similar to last time

When I was a kid, Snapchat was what we'd do after a particularly good poetry reading! Snap, and then chat about how much we liked the poem!

— David Malki ! (@malki) June 12, 2014

When I was a kid, 'WhatsApp' was what we'd say to each other! As a greeting! If you were cheeky, you'd respond "The sky!" Also, a beer ad!

— David Malki ! (@malki) June 12, 2014

When I was a kid, Instagram was what we called powdered, dehydrated grandmother! We had some in an urn but we never made it for some reason!

— David Malki ! (@malki) June 12, 2014

When I was a kid, Facebook was what I did on a long car ride! Face buried in a big book! Then I'd make Dad stop because I would get carsick!

— David Malki ! (@malki) June 12, 2014

When I was a kid, Vine was a plant! Like Tarzan swung from! If Tarzan swung from the Vine app, he'd be an Editor's Choice maybe!

— David Malki ! (@malki) June 12, 2014

When I was a kid, Angry Birds were a mean flock of birds that would always dive bomb our house! Because we were pigs that stole their eggs!

— David Malki ! (@malki) June 12, 2014

When I was a kid, texting meant typing! Keep your fingers on the home row! Not too fast or it jams! Don't call it texting, nobody says that!

— David Malki ! (@malki) June 12, 2014

When I was a kid, the only social media was Pravda!

— David Malki ! (@malki) June 12, 2014

When I was a kid, Samsung Galaxy S5 was a location in a William Gibson novel! Headcase had to jack into the undernet before the ion storm!

— David Malki ! (@malki) June 12, 2014

When I was a kid, ou sont the Edward Snowdens d'antan? He was most likely just a fetus or something!

— David Malki ! (@malki) June 12, 2014

When I was a kid, Gmail was what we said when the little flag was up on the mailbox! Gee, we got mail! It was usually bills! Or AOL disks!

— David Malki ! (@malki) June 12, 2014

@malki David what was twitter when you were a kid

— Sara McH (@yellowcardigan) June 12, 2014

@yellowcardigan we didn't have twitter it started in like 2006

— David Malki ! (@malki) June 12, 2014

spocksfatalboner:

spocksfatalboner:

Have you always wanted to explore a tiny pixilated version of the Enterprise-D as a tiny pixilated Data? Well you’re in luck!

look at this shit

lol what is even happening here

did u know there was a bathroom on the bridge?! this andorian did apparently

like wow say goodbye to my evening plans

Host John Oliver explained why he is both excited and extremely conflicted about the upcoming 2014 FIFA World Cup on a recent episode of Last Week Tonight with John Oliver. Specifically, Oliver refers to the history of the Fédération Internationale de Football Association (FIFA), the international organization behind the organized sport of soccer.

John Oliver’s excitement for the World Cup is tempered by knowing information about FIFA, the organization that produces it. John details the problems with the upcoming tournament and the staggering allegations of corruption against FIFA.

Congratulations people, we are back to square one.

Yes, there are finally now as many people working today as there were before the great recession began.

It only took 6+ years, way longer than any previous post-war recession, but at least there's one less bad thing to say about the economy now.

Here's the visual from the immortal Bill McBride:

Big news coming soon!