Attempt to replicate major social scientific findings of past decade fails

Attempt to replicate major social scientific findings of past decade fails
Scientists and the design of experiments under scrutiny after a major project fails to reproduce results of high profile studies
By Hannah Devlin
Aug 27 2018

Some of the most high profile findings in social sciences of the past decade do not stand up to replication, a major investigation has found.

The project, which aimed to repeat 21 experiments that had been published in Science or Nature – science’s two preeminent journals – found that only 13 of the original findings could be reproduced.

The research, which follows similar efforts in psychology and biomedical science, raises fresh concerns over the reliability of the scientific literature. However, the project’s leaders say their results do not reflect a “crisis” in the social sciences.

Prof Brian Nosek, executive director of the Center for Open Science and a professor at the University of Virginia, said: “I don’t think it’s a crisis, it’s a reformation. We’re in the midst of a dramatic increase in the rigour and transparency of research in the social sciences.”

Nosek said that, while some previous replication efforts had been viewed with hostility, this effort had been collaborative. Authors from nearly all of the papers under scrutiny engaged with the project to help ensure the repeat experiments were close replicas of the originals – and several of these scientists published responses that ran alongside the latest paper.

“It’s not recriminations about who is a bad researcher or otherwise,” said Nosek. “That’s something that has completely changed over the last five years. Replication in 2012 felt like an attack because it was so rare in science at the time. Now it’s become normal.”

Findings that failed to replicate included a study suggesting that viewing a picture of Rodin’s sculpture The Thinker led to people reporting weaker religious beliefs (a possible explanation being that analytical thought, as represented by the sculpture, counteracted religious beliefs). The finding that the physical act of washing your hands leads to less muddled thinking (a phenomenon known as cognitive dissonance) also failed the replication test.

“That doesn’t mean it’s unreplicable, no study is definitive,” said Nosek. “Science is really a process of uncertainty reduction.”

In total, the team tried to replicate one main finding from each of the 21 social science papers published between 2010 and 2015 in Science or Nature, widely regarded as the two most prestigious scientific journals.

They found evidence to back the original conclusions in 13 of the 21 (62%) studies. But, on average, the sizes of the effects recorded were about 75% as big in the replication studies, despite these using sample sizes that were on average five times as big.

“These results show that ‘statistically significant’ scientific findings need to be interpreted very cautiously until they have been replicated even if published in the most prestigious journals,” said Magnus Johannesson of the Stockholm School of Economics, another of the project leaders.

The latest work revealed scientists were also uncannily accurate at predicting which studies would later succeed or fail to replicate. About 200 scientists were recruited and on average predicted the replication outcomes for 18 out of the 21 papers under scrutiny.


Meet the ‘Change Agents’ Who Are Enabling Inequality

Meet the ‘Change Agents’ Who Are Enabling Inequality
By Joseph E. Stiglitz
Aug 20 2018

The Elite Charade of Changing the World 
By Anand Giridharadas 
288 pp. Alfred A. Knopf. $26.95.

First came the books describing just how much worse economic inequality had become over the past 20 years, with all the dramatic political implications now impossible to ignore. Then there were the tomes about globalization (including my own, I admit), detailing the West’s unfettered pursuit of neoliberal policies that abetted all this unfairness.

Well, prepare for a new genre: books gently and politely skewering the corporate titans who claim to be solving such problems. It’s an elite that, rather than pushing for systemic change, only reinforces our lopsided economic reality — all while hobnobbing on the conference circuit and trafficking in platitudes.

Anand Giridharadas, a former columnist for The New York Times, spoke about this phenomenon at an Aspen Institute conference in 2015, and he takes his ideas further in his entertaining and gripping new book, “Winners Take All.” As the Democratic Party struggles to figure out its future and global demagogy thrives, it’s worth considering where we went wrong and how best to save the world from the dangerous turn it has taken. It’s now very clear that globalization, technology and market liberalization did not bring their promised benefits — at least not for the vast majority of Americans and those in advanced countries around the world.

For those at the helm, the philanthropic plutocrats and aspiring “change agents” who believe they are helping but are actually making things worse, it’s time for a reckoning with their role in this spiraling dilemma. I suggest they might want to read a copy of this book while in the Hamptons this summer.

In a series of chapters centered on different individuals who are part of this rarefied class, Giridharadas exposes the rationalizations of the 0.001 percent who actually believe they are making the world a better place. The Sacklers helped create the opioid crisis but give money to important causes. The chief executive of Cinnabon thinks that being transparent about the fat and sugar she peddles offsets the harm her company creates. It’s a land of PowerPoint presentations and cuddly good intentions.

Giridharadas calls this prevailing ethos “MarketWorld,” made up of people who want “to do well and do good.” He beautifully catches the language of Aspen, Davos and the recently extant Clinton Global Initiative, which will doubtless reappear in the newly born Bloomberg initiative. It’s a world of feel-good clichés like “win-win” and “make a difference.” The rote conversations of this crowd were on recent display at the Public Theater, in the beginning of the second act of the Bruce Norris play “The Low Road.” As Giridharadas describes the ethos of MarketWorld, it’s made up of people like former President Bill Clinton who saw the anger bubbling up but proved unable to “call out elites for their sins: or call for power’s redistribution and fundamental systemic change; or suggest that plutocrats might have to surrender precious things for others to have a mere shot of transcending indecency.”

Like the dieter who would rather do anything to lose weight than actually eat less, this business elite would save the world through social impact investing, entrepreneurship, sustainable capitalism, philanthro-capitalism, artificial intelligence, market-driven solutions. They would fund a million of these buzzwordy programs rather than fundamentally question the rules of the game — or even alter their own behavior to reduce the harm of the existing distorted, inefficient and unfair rules. Doing the right thing — and moving away from their win-win mentality — would involve real sacrifice; instead, it’s easier to focus on their pet projects and initiatives. As Giridharadas puts it, people wanted to do “virtuous side projects instead of doing their day jobs more honorably.”

In order to really have an economy with the greatest opportunity for all, the kind of economy they seem to champion, the MarketWorlders would have to pay high levels of corporate and personal income tax, offer decent wages to their workers, allow unions, fund public schools (instead of pet charter projects) and support some form of single payer health care and campaign finance reform. One simply can’t arrive at a more economically equal reality when the rungs of the ladder are so far apart.

At Davos and the other international conclaves where the muckety-mucks celebrate the new economic world they have helped create, which has rewarded them so amply, corporate leaders move seamlessly from sessions discussing the risks of climate change, growing inequality and financial instability, to dinners at which they praise tax cuts for billionaires and corporations and applaud proposals for deregulation. They conveniently don’t mention the increases in taxes on a majority of those in the middle, the Republican moves to eliminate health insurance for some 13 million in a country where life expectancy is already in decline, the increase in pollution, the risk of another financial crisis, the ever increasing evidence of moral turpitude — whether it’s Wells Fargo cheating its customers or Volkswagen cheating on its emission tests. Cognitive dissonance is intrinsic to MarketWorld.


The Student Debt Problem Is Worse Than We Imagined

The Student Debt Problem Is Worse Than We Imagined
By Ben Miller
Aug 25 2018

Millions of students will arrive on college campuses soon, and they will share a similar burden: college debt. The typical student borrower will take out $6,600 in a single year, averaging $22,000 in debt by graduation, according to the National Center for Education Statistics.

There are two ways to measure whether borrowers can repay those loans: There’s what the federal government looks at to judge colleges, and then there’s the real story. The latter is coming to light, and it’s not pretty.

Consider the official statistics: Of borrowers who started repaying in 2012, just over 10 percent had defaulted three years later. That’s not too bad — but it’s not the whole story. Federal data never before released shows that the default rate continued climbing to 16 percent over the next two years, after official tracking ended, meaning more than 841,000 borrowers were in default. Nearly as many were severely delinquent or not repaying their loans (for reasons besides going back to school or being in the military). The share of students facing serious struggles rose to 30 percent over all.

Collectively, these borrowers owed over $23 billion, including more than $9 billion in default.

Nationally, those are crisis-level results, and they reveal how colleges are benefiting from billions in financial aid while students are left with debt they cannot repay. The Department of Education recently provided this new data on over 5,000 schools across the country in response to my Freedom of Information Act request.

The new data makes clear that the federal government overlooks early warning signs by focusing solely on default rates over the first three years of repayment. That’s the time period Congress requires the Department of Education to use when calculating default rates.

At that time, about one-quarter of the cohort — or nearly 1.3 million borrowers — were not in default, but were either severely delinquent or not paying their loans. Two years later, many of these borrowers were either still not paying or had defaulted. Nearly 280,000 borrowers defaulted between years three and five.

Federal laws attempting to keep schools accountable are not doing enough to stop loan problems. The law requires that all colleges participating in the student loan program keep their share of borrowers who default below 30 percent for three consecutive years or 40 percent in any single year. We can consider anything above 30 percent to be a “high” default rate. That’s a low bar.

Among the group who started repaying in 2012, just 93 of their colleges had high default rates after three years and 15 were at immediate risk of losing access to aid. Two years later, after the Department of Education stopped tracking results, 636 schools had high default rates.


The Mind Is a Difference-Seeking Machine

The Mind Is a Difference-Seeking Machine
By On Being
Aug 23 2018

The Mind Is a Difference-Seeking Machine

The science of implicit bias is one of the most promising fields for animating the human change that makes social change possible. The social psychologist Mahzarin Banaji is one of its primary architects. She understands the mind as a “difference-seeking machine” that helps us order and navigate the overwhelming complexity of reality. But this gift also creates blind spots and biases as we fill in what we don’t know with the limits of what we do know. This is science that takes our grappling with difference out of the realm of guilt and into the realm of transformative good.

Mahzarin Banaji is Richard Clarke Cabot Professor of Social Ethics in the department of psychology at Harvard University and a 2018 inductee into the National Academy of Sciences. She is the co-author of Blindspot: Hidden Biases of Good People and co-founder of Project Implicit, an organization aimed at educating the public on implicit bias.

Audio: 52 min (Transcript is included)

Are Superstar Firms and Amazon Effects Reshaping the Economy?

Are Superstar Firms and Amazon Effects Reshaping the Economy? 
The biggest companies may be influencing things like inflation and wage growth, possibly at the expense of central bankers’ power to do so.
By Neil Irwin
Aug 25 2018

JACKSON HOLE, Wyo. — Two of the most important economic facts of the last few decades are that more industries are being dominated by a handful of extraordinarily successful companies and that wages, inflation and growth have remained stubbornly low. 

Many of the world’s most powerful economic policymakers are now taking seriously the possibility that the first of those facts is a cause of the second — and that the growing concentration of corporate power has confounded the efforts of central banks to keep economies healthy. 

Mainstream economists are discussing questions like whether “monopsony” — the outsize power of a few consolidated employers — is part of the problem of low wage growth. They are looking at whether the “superstar firms” that dominate many leading industries are responsible for sluggish investment spending. And they’re exploring whether there is an “Amazon Effect” in which fast-changing pricing algorithms by the online retailer and its rivals mean bigger swings in inflation. 

If not yet fully embraced, the ideas have become prominent enough that this weekend, at an annual symposium in the Grand Tetons, leaders of the Federal Reserve and other central banks discussed whether corporate consolidation might have broad implications for economic policy.

“A few years ago, questions of monopoly power were studied by specialists in a very technical way, without linking them to the broader issues that animate economic policy,” said Jason Furman, an economist at Harvard’s Kennedy School of Government, who advanced some of these ideas in his former job as the Obama White House’s chief economist. “In the last few years, there’s been an explosion of research that breaks down those walls.”

Central bankers tend not to chase the latest research fads, as Mr. Furman put it. But they, too, are wrestling more intensely with the possibility that the details of how companies compete and exert power matter a great deal for the overall well-being of the economy.

While these topics more commonly show up in debates around antitrust policy or how the labor market is regulated, it may have implications for the work of central banks as well. For example, if concentrated corporate power is depressing wage growth, the Fed may be able to keep interest rates lower for longer without inflation breaking out. If online retail makes prices jump around more than they once did, policymakers should be more reluctant to make abrupt policy changes based on short-term swings in consumer prices.

Esther George, the president of the Federal Reserve Bank of Kansas City, the host of the conference, has been intrigued by the weak lending to small and midsize businesses in recent years, even amid an economic recovery. She and her staff have explored whether the increasing concentration of the banking industry among a handful of giants might be a cause.

“Looking at the size and footprint of firms has not been mainstream,” Ms. George said, “but it appears to be very broad-based and a signal of something worth taking seriously.”

For example, more of the investment of modern corporations takes the form of intangible capital, like software and patents, rather than machines and other physical goods. That may be a reason low interest rate policies by central banks over the past decade didn’t prompt more capital spending, said Nicolas Crouzet and Janice Eberly of Northwestern University in a paper presented at the conference.

Banks are generally disinclined to treat intellectual property or other intangible items as collateral against loans, which could mean interest rate cuts by a central bank have less power to generate increased investment spending.


Inviting the Next Financial Crisis

Inviting the Next Financial Crisis
It is infuriating that officials have put the welfare of most Americans at risk to enrich the wealthiest few.
By NYT Editorial Board
Aug 25 2018

The economy has come a long way from the dark days of 2008, when the collapse of Lehman Brothers and the bailout of big banks led to worldwide economic disaster. For much of the last decade, the economy has been growing and the stock market has been rising. But this steady climb is lulling bankers, lawmakers and regulators into repeating mistakes that contributed to that crisis and cost millions of people their jobs, homes and savings. 

The financial system and economy are clearly on much firmer ground than they were a decade ago. Wages are barely keeping up with inflation, but the unemployment rate, which climbed as high as 10 percent, has fallen to 3.9 percent. The housing market, once crippled by foreclosures, has sprung back to life, with home prices scaling new heights in many parts of the country. Banks, once dependent on taxpayer dollars to keep their doors open, are raking in profits. 

Much of the credit for the recovery belongs to the swift response from the Obama administration, the Federal Reserve and Congress. Lawmakers and President Barack Obama worked to stimulate the economy by nearly $1 trillion. The Fed pumped life into the financial system by lowering interest rates, buying bonds and rescuing institutions like the American International Group, which had insured financially compromised banks. Congress enacted the Dodd-Frank law, imposing tighter regulations on financial institutions and limiting their ability to take bet-the-farm risks with borrowed money. The law helped instill confidence in banks that had squandered their credibility by blowing billions on dubiously engineered investments that few understood and fewer could explain in plain English. It also created the Consumer Financial Protection Bureau, which defended consumers from predatory businesses. And Congress and Mr. Obama extended health insurance to 20 million people with the Affordable Care Act, protecting vulnerable families from crushing medical bills. 

Yet the economy has still not fully recovered. The per capita gross domestic product of the United States is about $70,000 smaller over the average person’s lifetime than it would have been had the economy stayed on the trajectory it had been on before the crisis, according to a recent analysis published by the Federal Reserve Bank of San Francisco. The authors of that report — Regis Barnichon, Christian Matthes and Alexander Ziegenbein — conclude that the economy is “unlikely to regain” that lost ground, a stunning acknowledgment of the permanent and significant costs of avoidable financial crises.

Of course, averages obscure a lot. Americans have not shared equally in the losses from the crisis. Families of modest means have far fewer, or in many cases zero, assets; they may have lost their homes and their savings. The average family of three earning less than $42,500 a year saw its net worth chopped nearly in half, to $10,800 in 2016, from $18,500 in 2007, the Pew Research Center found. Wealth of families earning $42,500 to $127,600 fell by nearly a third, to $110,100. Yet, the wealth of affluent families who earn more than $127,600 jumped nearly 10 percent, to $810,800. 

The crisis and the government response to it worsened longer-term trends that have caused wages to stagnate for most families while rewarding the top 1 percent with an ever-bigger slice of the economic pie. Obama officials and Congress clearly made a big mistake early in the recession by focusing more intently on saving banks — and, thus, bankers and investors — and much less on directly helping families facing foreclosures and layoffs. Later in the recovery, the decision by Republican leaders in Congress to oppose every Obama proposal prevented the government from doing much to help people regain what they had lost or to heat up the tepid recovery with infrastructure spending and other stimulus measures. 

Before the crisis, the share of economic output that went to workers had been falling steadily since early 2001, when it stood at 64 percent. After the crisis it plunged to about 56 percent, according to the Bureau of Labor Statistics, rising only slightly in the last few years.

This is because as workers’ incomes have stalled, corporate profits have shot up, especially for a small number of what some experts call “superstar firms,” including technology giants like Apple; Alphabet, which owns Google; and Facebook. 

As a few big companies with relatively few employees amass greater market power and profits, less is left over for workers, according to a 2017 working paper by economists from M.I.T., Harvard and the University of Zurich. 

As a candidate, Donald Trump spoke about getting tough on Wall Street, fighting corporate consolidation and looking out for “forgotten men and women” — rhetoric that won him the support of some working-class voters who had backed Mr. Obama. But he and his fellow Republicans in Congress have governed like conventional far-right conservatives — going easy on Wall Street, doing little about corporate consolidation, bolstering corporate profits and gutting a range of protections for those “forgotten men and women.”

Last year, Republicans claimed their biggest legislative victory of the Trump era, reducing federal revenue by $1.5 trillion over 10 years by slashing taxes on corporations and wealthy families. The legislation provides generous and permanent tax cuts to rich people in the investor class, including foreigners who own stock in American businesses. Working-class families, by contrast, received minor savings that are set to automatically vanish after 2025. The tax law will widen income inequality and encourage financial excesses by overstimulating an economy that is already nine years into a recovery.


Does $60,000 make you middle-class or wealthy on Planet Earth?

Does $60,000 make you middle-class or wealthy on Planet Earth?
By Heather Long, Leslie Shapiro
Aug 20 2018

The world is on the brink of a historic milestone: By 2020, more than half of the world’s population will be “middle class,” according to Brookings Institution scholar Homi Kharas.

Kharas defines the middle class as people who have enough money to cover basics needs, such as food, clothing and shelter, and still have enough left over for a few luxuries, such as fancy food, a television, a motorbike, home improvements or higher education.

It’s a critical juncture: After thousands of years of most people on the planet living as serfs, as slaves or in other destitute scenarios, half the population now has the financial means to be able to do more than just try to survive.

“There was almost no middle class before the Industrial Revolution began in the 1830s,” Kharas said. “It was just royalty and peasants. Now we are about to have a majority middle-class world.”

Today, the middle class totals about 3.7 billion people, Kharas says, or 48 percent of the world’s population. An additional 190 million (2.5 percent) comprise the mega-rich. Together, the two groups make up a majority of humanity in 2018, a shift with wide-reaching consequences for the global economy — and potential implications for the happiness of millions of people.

So how much money does it take to meet Kharas’s definition of middle-class? It depends on where you live and, more precisely, on how expensive things are where you live. Kharas’s definition takes into account the higher cost of meeting basic needs in places such as the United States, Western Europe and Japan than in much of the developing world.

In dollar terms, Kharas defines the global middle class as those who make $11 to $110 a day, or about $4,000 to $40,000 a year. Those are per-person numbers, so families with two parents and multiple children would need a lot more. It’s a wide range, but remember that he adjusts the amounts by country to take into account how much people can buy with the money they earn. For example, earning $12,000 for a family of four in Indonesia would qualify for the global middle class, but it would not in the United States.

Am I in the global middle class? Use the Washington Post calculator to see where your annual income falls on the global spectrum.

What about in the U.S. middle class? The median household income in the United States is just over $59,000. That’s right in the middle for the United States, but it ranks in the 91st percentile globally for a family of three, according to Kharas’s research, putting that U.S. family on the high end of the global middle class. (If you want to see whether your income qualifies for the American middle class, check out this Washington Post calculator here).

“Americans have a hard time realizing the American middle class is, in a global perspective, pretty high up,” said Anna Rosling Rönnlund, who founded the Dollar Street project to photograph families and their lifestyles around the world.

Where are these new residents of the middle class coming from? Kharas estimates 140 million to 170 million people a year are moving into the middle class every year. (More-exact estimates are difficult to come by; not all countries keep uniform records, and in some places the data is years out of date.)

India and China have been driving much of the middle-class boom in recent years. Now, Kharas said, Southeast Asian countries such as Thailand and Vietnam are poised for a middle-class surge.