Archive for January, 2007

Social Trust

Tuesday, January 16th, 2007

In 1979, after a nine-year study of 6,928 adults living in Alameda County, California, epidemiologists Lisa Berkman and S. Leonard Syme reported that people with few social ties were two to three times more likely to die of all causes than were those with more extensive contacts. This relationship persisted even after controlling for such characteristics as age and health practices, including cigarette smoking, drinking, exercise, and the use of medical services. The basic findings of the Alameda County Study have since been confirmed in more than a half dozen epidemiological studies in different communities.

There are marked geographical variations in civic trust and association membership across the United States, and when these indicators of social capital are arrayed against regional differences in mortality and morbidity, the resulting correlations are striking. The chart “Social Capital and Mortality Rates” (below) shows the relationship between the level of civic trust and the age-adjusted rate of death from all causes for the 39 states for which data were available in the National Opinion Research Center’s General Social Surveys. The lower the trust between citizens — as indicated by the proportion of respondents in each state who believed that “most people cannot be trusted” — the higher is the average mortality rate.

 

 

A similar relationship with mortality prevails for the per capita membership of state residents in voluntary associations. These relationships between social cohesion and mortality hold among both whites and African Americans, as well as among men and women, and they persist after statistical adjustment for state variations in median household income and proportion of households living below the federal poverty threshold.

The figure below, “Social Trust and Quality of Life,” displays the correlation between level of civic trust and a measure of self-reported well-being. The National Center for Chronic Disease Prevention and Health Promotion employed the Behavioral Risk Factor Surveillance System (BRFSS) to ascertain the proportion of residents in each state reporting that their health was only fair or poor as opposed to good or excellent. (The BRFSS is a representative, random telephone survey that sampled more than 350,000 community-dwelling American adults between 1993 and 1996.) Again, there is a striking correlation between social capital and quality of life.

 

 

Bowling league membership turns out to correlate rather well with who lives or dies (see “Bowling League Membership and Mortality,” below).

 

 

“Income Inequality (Robin Hood Index) and Social Trust” (below) shows the rising trend in income inequality plotted against the steady decline in civic trust, as tracked by the General Social Surveys. The measure of income inequality is the Robin Hood Index, which equals the proportion of aggregate income that would have to be redistributed from households with disproportionate earnings to those earning less, if incomes were to be level. The higher the Robin Hood Index, the bigger the income gap. As “Income Inequality and Social Trust” shows, the larger the income gap, the lower is citizens’ trust in each other. Nearly identical results are obtained when we plot income disparity against per capita participation in voluntary associations.

 

 

Long Live Community” by Ichiro Kawachi

Conflict & Biases

Monday, January 8th, 2007

 

 

People have dozens of decision-making biases, and almost all favor conflict rather than concession.

People are prone to exaggerating their strengths (for example, about 80% of us believe that our driving skills are better than average). Such a predisposition, often shared by leaders on both sides of a conflict, is likely to produce a disaster.

When Daniel Kahneman & Jonathan Renshon constructed a list of the biases uncovered in 40 years of psychological research, they found that all the biases favor hawks. These psychological impulses incline national leaders to exaggerate the evil intentions of adversaries, to misjudge how adversaries perceive them, to be overly sanguine when hostilities start, and overly reluctant to make necessary concessions in negotiations.

Even when people are aware of the context and possible constraints on another party’s behavior, they often do not factor it in when assessing the other side’s motives.

Imagine, for example, that you have been placed in a room and asked to watch a series of student speeches on the policies of Venezuelan leader Hugo Chávez. You’ve been told in advance that the students were assigned the task of either attacking or supporting Chávez and had no choice in the matter. Now, suppose that you are then asked to assess the political leanings of these students. Shrewd observers, of course, would factor in the context and adjust their assessments accordingly. In fact, many experiments suggest that people would overwhelmingly rate the pro-Chávez speakers as more leftist.

Individuals who attribute others’ behavior to deep hostility are quite likely to explain away their own behavior as a result of being “pushed into a corner” by an adversary. During the run-up to World War I, the leaders of every one of the nations that would soon be at war perceived themselves as significantly less hostile than their adversaries.

Psychological research has shown that a large majority of people believe themselves to be smarter, more attractive, and more talented than average, and they commonly overestimate their future success. People are also prone to an “illusion of control”: They consistently exaggerate the amount of control they have over outcomes that are important to them — even when the outcomes are in fact random or determined by other forces.

The optimistic bias and the illusion of control are particularly rampant in the run-up to conflict. Predictions that the Iraq war would be a “cakewalk,” are just the latest in a long string of bad hawkish predictions. Washington elites treated the first major battle of the Civil War as a social outing, so sure were they that federal troops would rout rebel forces. General Noel de Castelnau, chief of staff for the French Army at the outset of World War I, declared, “Give me 700,000 men and I will conquer Europe.” In fact, almost every decision maker involved in WWI predicted a relatively quick and easy victory.

The intuition that something is worth less simply because the other side has offered it is referred to in academic circles as “reactive devaluation.”

Evidence suggests that this bias is a significant stumbling block in negotiations between adversaries. In one experiment, Israeli Jews evaluated an actual Israeli-authored peace plan less favorably when it was attributed to the Palestinians than when it was attributed to their own government. Pro-Israel Americans saw a hypothetical peace proposal as biased in favor of Palestinians when authorship was attributed to Palestinians, but as “evenhanded” when they were told it was authored by Israelis.

As the strategic calculus shifts to territory won or lost and casualties suffered, a new idiosyncrasy in human decision making appears: our deep-seated aversion to cutting our losses. Imagine, for example, the choice between:

Option A: A sure loss of $890

Option B: A 90% chance to lose $1,000 and a 10% chance to lose nothing.

In this situation, a large majority of decision makers will prefer the gamble in Option B, even though the other choice is statistically superior. People prefer to avoid a certain loss in favor of a potential loss, even if they risk losing significantly more. When things are going badly in a conflict, the aversion to cutting one’s losses, often compounded by wishful thinking, is likely to dominate the calculus of the losing side.

Why Hawks Win,” by Daniel Kahneman & Jonathan Renshon

Habituation

Friday, January 5th, 2007

 

Imagine that you and a friend are at a new restaurant, and have discovered that you both want the partridge. You decide that one of you will order the partridge, the other will order the gumbo, and that you will then share them. You do this because you believe that variety is the spice of life. If we were to measure your pleasure after the meal, we would probably find that you are happier with the sharing arrangement than you would have been had you each had a full order of partridge to yourselves.

But something strange happens when we extend this problem in time.

Researchers invited volunteers to come to the laboratory for a snack once a week for several weeks. They asked some of the volunteers (choosers) to choose all their snacks in advance, and the choosers usually opted for a healthy dose of variety. Next, the researchers asked a new group of volunteers to come to the lab once a week for several weeks. They fed some of these volunteers their favorite snack every time (no-variety group), and they fed other volunteers their favorite snack on most occasions and their second-favorite snack on others (variety group). When they measured the volunteers’ satisfaction over the course of the study, they found that volunteers in the no-variety group were more satisfied than were volunteers in the variety group. In other words, variety made people less happy, not more. How can variety be the spice of life when one sits down with a friend at a restaurant but not when one orders snacks to be consumed in successive weeks?

When we have an experience on successive occasions, we quickly begin to adapt to it, and the experience yields less pleasure each time. Psychologists call this habituation. (Economists call it declining marginal utility.) One way to beat habituation is to increase the variety of one’s experiences. Another way is to increase the amount of time that separates repetitions of the experience. Time and variety are two ways to avoid habituation, and if you have one, then you don’t need the other. In fact, when episodes are sufficiently separated in time, variety can actually be costly.

Stumbling on Happiness, Daniel Gilbert

Bribery

Tuesday, January 2nd, 2007

Jakob Svensson has found that socialist and recently socialist economies show higher levels of corruption than others. Among the factors he has tested for correlation with corruption is (1) the overall education level of the adult population, (2) openness to imports (measured by imports as a proportion of GDP), which is linked with opportunities for smuggling, (3) freedom of the press (as ranked by Freedom House), on the hypothesis that independent journalists will expose, and thereby curtail, corruption, (4) the number of days needed to start a business, a proxy for the number of permits required, and therefore red tape. He found clear correlations between all these variables and the overall level of corruption.

Among the many factors correlated with the level of corruption in a country, one stands out: where there is a lot of government, there is a lot of bribery.

How to grease a palm,” The Economist