Progress Daily

Reading the 3bn “base pairs” in human DNA — akin to letters, encoding a total of between 20,000 and 30,000 genes that are the “words” of genetics — is getting faster as companies find quicker ways to “read” entire stretches of DNA at a time, like reading a sentence in chunks rather than letter by letter.

The cost of sequencing an individual genome is thus falling exponentially — just as the cost of hard disk space or transistors on a chip did when computing took off.

The rapidly falling cost and time needed to map your DNA:

2003
$440M
13 years to map

2007
$10M
4 years

2008
$100K
4 weeks

2012
$100*
2 days

*Forecast

“Mapping the individual - cheaply,” by Charles Arthur

Justin Wolfers and Betsey Stevenson analyzed all the major post-war happiness studies data (.pdf file here), including new data from the Gallup World Poll, which contains detailed data on subjective well-being for 132 countries in 2006. Contrary to previous researchers using less complete date, they found that: 1) Rich people are happier than poor people. 2) Richer countries are happier than poorer countries. 3) As countries get richer, they tend to get happier.

The following chart takes the average levels of satisfaction reported on the Gallup Poll’s 0-10 scale, and plots it against G.D.P. per capita (note the log scale):

The correlation between average levels of happiness and average incomes is very high — greater than 0.8.

The relationship between happiness and log income appears nearly linear. Thus, a 10% rise in income in a rich country like the USA appears to increase happiness by about as much as a 10% rise in income in Burundi — in fact, the slope appears to get steeper above $15K!

A 10% rise in income in Burundi requires one-sixtieth as much income as a 10% rise in income in the USA. Thus, even if the slope is three times as steep for rich countries as poor countries (as Wolfers & Stevenson estimate), this still means than an extra $100 has about a twenty-times-greater effect on happiness in Burundi.

“The Economics of Happiness, Part 1 & Part 2,” by Justin Wolfers

Until recently, most “free” commericial products were the result of a “cross-subsidy”: You’d get one thing free if you bought another, or you’d get a product free only if you paid for a service.

The costs of products on the Web are falling fast.

Offering free music proved successful for Radiohead, Trent Reznor of Nine Inch Nails,etc. The fastest-growing parts of the gaming industry are ad-supported casual games online and free-to-try massively multiplayer online games. Virtually everything Google does is free to consumers, from Gmail to Picasa to GOOG-411.

Moore’s law dictates that a unit of processing power halves in price every 18 months, the price of bandwidth and storage is dropping even faster.

40 years ago, the principal nutritional problem in America was hunger; now it’s obesity, for which we have the Green Revolution to thank. Forty years ago, charity was dominated by clothing drives for the poor. Now you can get a T-shirt for less than the price of a cup of coffee, thanks to China and global sourcing. So too for toys, gadgets, and commodities of every sort.

Digital technology benefits from these dynamics and from the 20th-century shift from Newtonian to quantum machines. We’re just beginning to exploit atomic-scale effects in new materials — semiconductors (processing power), ferromagnetic compounds (storage), and fiber optics (bandwidth).

Last year, Yahoo announced that Yahoo Mail, its free webmail service, would provide unlimited storage.

Storage now joins bandwidth (YouTube: free) and processing power (Google: free) in the race to the bottom. Basic economics tells us that in a competitive market, price falls to the marginal cost, and every day the marginal cost of digital information comes closer to nothing.

Give a product away and it can go viral. Charge a single cent for it and you’re in an entirely different business.

In the traditional media model, a publisher provides a product free (radio & television), or nearly free (newspapers & magazines) to consumers, and advertisers pay to ride along.

There are dozens of ways that media companies make money around free content, from selling information about consumers to brand licensing, “value-added” subscriptions, and direct ecommerce. Now an entire ecosystem of Web companies is growing up around the same set of models.

The priceless economy can be broken down into six broad categories:

1. “Freemium.” What’s free: Web software and services, some content. Free to whom: users of the basic version. (Think Flickr and the $25-a-year Flickr Pro.) A typical online site follows the 1 Percent Rule — 1 percent of users support all the rest.

2. Advertising. What’s free: content, services, software, and more. Free to whom: everyone. Examples: pay-per-pageview banners, pay-per-click text ads, pay-per-transaction “affiliate ads,” site sponsorships, paid inclusion in search results, paid listing in information services, lead generation (where a third party pays for the names of people interested in a certain subject), product placement (PayPerPost), pay-per-connection on social networks, etc.

3. Cross-subsidies. What’s free: any product that entices you to pay for something else. Free to whom: everyone willing to pay eventually, one way or another. Expensive wine subsidizes food in a restaurant. In any package of products and services, the price of each individual component is often determined by psychology, not cost. Your cell phone company may not make money on your monthly minutes — it keeps that fee low because it knows that’s the first thing you look at when picking a carrier — but your monthly voicemail fee is pure profit.

4. Zero marginal cost. What’s free: things that can be distributed without an appreciable cost to anyone. Free to whom: everyone. (Best example: online music.)

5. Labor exchange. What’s free: Web sites and services. Free to whom: all users, since the act of using these sites and services actually creates something of value. When rating stories on Digg, voting on Yahoo Answers, or using Google’s 411 service, the act of using the service creates something of value, either improving the service itself or creating information that can be useful somewhere else.

6. Gift economy. What’s free: anything & everything, be it open source software or user-generated content. Free to whom: everyone. From Freecycle (free secondhand goods for anyone who will take them away) to Wikipedia, money isn’t the only motivator.

Thanks to Google, we now have a handy way to convert from reputation (PageRank) to attention (traffic) to money (ads). There is a limited supply of reputation and attention in the world at any point in time. These are the new scarcities — and free exists mostly to acquire these valuable assets.

“Free! Why $0.00 Is the Future of Business,” by Chris Anderson

Within a few months China will overtake America as the country with the world’s largest number of internet users. For the past three years China has also been the world’s largest exporter of information and communications technology. It already has the same number of mobile-phone users (500m) as the whole of Europe.

According to India’s telecoms regulator, half of all urban dwellers have mobile- or fixed-telephone subscriptions and the number is growing by 8m a month. India produces more engineering graduates than America.

The World Bank’s recently released its Global Economic Prospects. Between the early 1990s and the early 2000s, the index that summarises the technology adoption indicators rose by 160% in poor countries (with incomes per person of less than about $900 a year at current exchange rates) and by 100% in middle-income ones ($900-11,000). The index went up by only 77% in industrialised countries (with average incomes above $11,000). Poor and middle-income nations, the bank concludes, are catching up with the West.

The main channels through which technology is diffused are foreign trade (buying equipment and new ideas directly); foreign investment (having foreign firms bring them to you); and emigrants in the West.

In the past ten years the ratio of poor countries’ imports of high-tech products to their GDPs has risen by more than 50%. The ratio in middle-income countries has increased by over 70%. Capital goods (mainly industrial machinery) often embody new technology, and imports of these have increased faster in middle-income countries than in rich ones.

Emerging economies’ share of global trade in high-tech goods rose by 140% between the mid-1990s and the mid-2000s.

Relative to GDP, inflows of foreign direct investment to developing economies have increased sevenfold since the 1980s. In some countries, such as Hungary and Brazil, foreign firms account for half or more of all R&D spending by companies.

Nearly half the ($40 billion-worth of) foreign direct investment in China in 2000 came from Chinese abroad. Remittances have doubled in the past ten years and now account for roughly 2% of developing countries’ GDPs — more than foreign aid.

The World Bank looked at how much time elapsed between the invention of something and its widespread adoption (defined as when 80% of countries that use a technology first report it). For 19th-century technologies the gap was long: 120 years for trains and open-hearth steel furnaces, 100 years for the telephone. For aviation and radio, invented in the early 20th century, the lag was 60 years. But for the PC and CAT scans the gap was around 20 years and for mobile phones just 16.

In the World Bank’s database, there are 28 examples of a new technology reaching 5% of the market in a rich country; of those, 23 went on to achieve over 50%. In other words, if something gets a foothold in a rich country, it usually spreads widely.

In emerging markets this is not necessarily so. The bank has 67 examples of a technology reaching 5% of the market in developing countries — but only six went on to capture half the national market.

Technology use in developing countries is highly concentrated. Almost three-quarters of China’s high-tech trade comes from just four regions on the coast. More than two-thirds of the stock of foreign investment in Russia in 2000 was in Moscow and its surroundings. Whereas half of India’s city-dwellers have telephones, little more than one-twentieth of people in the countryside do.

Rich countries spend 2.3% of GDP on R&D, East Asians 1.4%, and Latin America 0.6%. In East Asia and the West companies spend most of the money and do most of the research. In eastern Europe and Latin America the government is the largest source of finance, and in Latin America universities do the largest share of the work.

“Of internet cafés and power cuts,” The Economist

Consumers saved $7 billion by shopping on eBay in 2003, according to a study by Wolfgang Jank and Galit Shmueli (”New Research Finds Consumers Save More Than $7B by Shopping on eBay“).

The researchers measured the money shoppers were willing to pay for a product versus what they actually paid. On average, users paid $4 less, the study found.

Given the huge number of auctions on the site, the savings added up into the billions of dollars.

The researchers used data from a sniping service, Cniper.com, operated by Ravi Bapna.

Sniping services are used by shoppers to help them automatically place bids in an auction during its final seconds. Shoppers set the maximum price they are willing to pay and the technology does the rest.

The researchers found in the 4,500 auctions they examined that users frequently won items before reaching their maximum bid.

“The more you spend on eBay, the more you save,” by Verne Kopytoff

Daniel Esty analyzed the Environmental Sustainability Index, which grades the “environmental health” of 150 countries. He found that the single biggest variable in determining a country’s ranking is income per head.

Economic growth offers solutions to the sorts of environmental woes (local air pollution, for example) that directly kill humans. About a quarter of all deaths in the world have some link to environmental factors. Among these killers (especially of children) are diarrhoea, respiratory infections and malaria.

As poor countries get richer, they usually invest heavily in environmental improvements, such as cleaning up water supplies and improving sanitation, that boost human health. (Their economies may also shift gear, from making steel or chemicals to turning out computer chips.)

But the link between growth and environment is much less clear when it comes to the sort of pollution that fouls up nature (such as acid rain, which poisons lakes and forests) as opposed to directly killing human beings.

A mixture of factors related to good government -— accurate data, transparent administration, lack of corruption, checks and balances — all show a clear statistical relationship with environmental performance. Among countries of comparable income, tough regulations and, above all, enforcement are the key factors in keeping things green.

“How green is their growth,” The Economist

In China 25 years ago, over 600m people — two-thirds of the population — were living in extreme poverty (on $1 a day or less). Now, the number on $1 a day is below 180m. Worldwide, 135m people escaped dire poverty between 1999 and 2004. This is more people, more quickly than at any other time in history.

In 2007 Unicef said that for the first time in modern history fewer than 10m children were dying each year before the age of five. That represents a fall of a quarter since 1990. Three-quarters of people aged 15-25 were literate in 1975; now the rate is nearly nine-tenths.

The fertility rate in low- and middle-income countries has crashed. In East Asia and the Pacific, the rate was 5.4 in 1970. Now it is 2.1. In South Asia, the fertility rate halved (from 6.0 to 3.1). In the world as a whole, fertility has fallen from 4.8 to 2.6 in a generation (25 years).

The biggest decline is in those countries that are most involved with globalization (especially in East Asia, though China is a special case because of its one-child policy). With the exception of Yemen, all the countries with fertility rates over 5.0 are in Africa.

In closed agrarian societies, families need a lot of children as insurance against disaster. But in countries that have opened themselves up, families can rely on other sorts of protection, such as urban jobs or trade.

These demographic changes help to create a virtuous circle of growth. When fertility rises then falls, you get a bulge of people at and just after the inflection point. Between 1960 and 1990 Europe and America had relatively few old people (because mortality rates had earlier been high), relatively few children (because fertility had fallen) and a disproportionately big number of economically active adults.

Developing countries are seeing a similar confluence now.

A World Bank study of 19 poor countries concluded that every 1% increase in national income per head translates into a 1.3 point fall in extreme poverty.

Last year the global economy entered its fifth year of over 4% annual growth — the longest period of such strong expansion since the early 1970s. Unlike previous expansions, inflation remained relatively tame.

During this boom, according to the World Bank, national income in the European Union rose slightly more than in America for the first time in a decade. Growth in East Asia was 10%, in South Asia over 8%, in eastern Europe almost 7% and in Africa, thanks to the commodity boom, over 6%. Almost half of humanity, spread over more than 40 nations, lives in countries growing at 7% a year or more (a rate that doubles the size of an economy in a decade). This is twice the number of fast growers that existed in the years between 1980 and 2000.

The world’s economic balance is tilting from rich industrialized countries to emerging markets. Their share of world output in 2006 was just below half, and rising.

Since the mid-1990s, the incomes of the poorest fifth have risen everywhere except, marginally, in Latin America, where they have been affected by the after-shocks of debt crises. In Asia, the real incomes of the poorest fifth rose 4% a year; in Africa, by 2% a year, faster than the rise for other income groups.

The World Bank labels as “fragile” (as opposed to “failed”) troubled countries where the government has partial control of territory (Sudan), where it cannot deliver basic services (Zimbabwe) and places with high levels of political conflict (Nigeria).

Fragile states contain roughly half the developing world’s childhood deaths. About a third of their people are undernourished and more than that do not have access to drinking water. Most of the countries with fertility rates over 5.0 are fragile. They are much more likely to be affected by wars, refugees and every sort of political crisis.

“Somewhere over the rainbow,” The Economist

The cost of developing drugs for rare and common diseases are about the same, but the revenues aren’t. Pharmaceutical companies concentrate on drugs with larger markets because larger markets mean more profits.

As a result, patients diagnosed with rare diseases — those ranked at the bottom quarter in terms of how frequently they are diagnosed — are 45% more likely to die before age 55 than are patients diagnosed with more common diseases.

If China and India were as wealthy as the U.S., the market for cancer drugs would be 8 times larger than it is today.

Cancer is now China’s leading killer, with spending on treatment increasing by 17% per year. AstraZeneca and Novartis are building major research facilities in China, which will benefit patients everywhere.

There are only about 6M scientists and engineers in the entire world, nearly a quarter of whom are in the U.S. If the world as a whole were as wealthy as the U.S. and were devoting the same share of population to research and development, there would be more than 5 times as many scientists and engineers worldwide.

Even small changes in economic growth rates produce large benefits. At current income levels, with an inflation-adjusted growth rate of 3% per year, America’s real per capita gross domestic product would exceed $1 million per year in just over 100 years, more than 22 times higher than it is today.

“Dismal Science Sees Upbeat Future,” Alexander Tabarrok

Humans have spent most of their time as hunter-gatherers — from at least 85,000 years ago to the birth of agriculture around 73,000 years later.

Human height shrank by nearly six inches after the first adoption of crops in the Near East.

Farmers also had more skeletal wear and tear from the hard work, their teeth rotted more, they were short of protein and vitamins and they caught diseases from domesticated animals: measles from cattle, flu from ducks, plague from rats and worms from using their own excrement as fertiliser.

From the !Kung in the Kalahari to the Inuit in the Arctic and the aborigines in Australia, two-thirds of modern hunter-gatherers are in a state of almost constant tribal warfare, and nearly 90% go to war at least once a year. Usually around 25-30% of adult males die from homicide. The warfare death rate of 0.5% of the population per year that Lawrence Keeley calculates as typical of hunter-gatherer societies would equate to 2 billion people dying during the 20th century.

Richard Wrangham says that chimpanzees and human beings are the only animals in which males engage in co-operative and systematic homicidal raids. The death rate is similar in the two species.

Constant warfare was necessary to keep population density down to one person per square mile. Farmers can live at 100 times that density.

Notice a close parallel with the industrial revolution. The urban poor were overworked and underfed. But 18th-century rural England was a place where people starved each spring as the winter stores ran out, and where where the “putting-out” system of textile manufacture at home drove workers harder for lower pay than the factories would. The industrial revolution caused a population explosion because it enabled more babies to survive.

There is no longer much doubt that hunter-gatherers were the cause of the extinction of the megafauna in North America 11,000 years ago and Australia 30,000 years before that.

At first, modern humans around the Mediterranean relied almost entirely on large mammals for meat. Then they switched their attention to smaller animals, and especially to warm-blooded, fast-breeding species, such as rabbits, hares, partridges and smaller gazelles. The archaeological record tells this same story at sites in Israel, Turkey and Italy.

Human population densities were growing too high for the slower-reproducing prey such as tortoises, horses and rhinos. Only the fast-breeding rabbits, hares and partridges, and for a while gazelles, could cope with such hunting pressure. This trend accelerated about 15,000 years ago as large game and tortoises disappeared.

The belief that hunter-gatherers have plenty of free time turns out to be a bit of a myth. The measurements of time spent getting food by the !Kung omitted food-processing time and travel time, partly because the anthropologists gave their subjects lifts in their vehicles and lent them metal knives to process food.

Even 40,000 years ago, technology and lifestyle were in a state of continuous change, especially in western Eurasia. By 34,000 years ago people were making bone points for spears, and by 26,000 years ago they were making needles. Harpoons, bone spear throwers, and string appeared 18,000 years ago.

15,000 years ago people first domesticated another species — the wolf. 12,000 years ago came agriculture.

Just as we rebounded from the extinction of the megafauna and became even more numerous by eating first rabbits then grass seeds, so in the early 20th century we faced starvation for lack of fertiliser when the population was a billion people, but can now look forward with confidence to feeding 10 billion on less land using synthetic nitrogen, genetically high-yield crops and tractors.

“Noble or savage?,” The Economist

Only a decade after their commercial introduction, genetically modified (”GM”) crops are now cultivated in 22 countries on an area more than 4 times the size of Britain, by over 10 million farmers, of whom 9 million are resource-poor farmers in developing countries, mainly India and China. Most of these small-scale farmers grow pest-resistant GM cotton. In India, production tripled last year. GM cotton benefits farmers because it reduces the need for insecticides, thereby increasing their income and improving their health.

Every academy of science — the Indian, Chinese, Mexican, Brazilian, French and US academies as well as the UK’s Royal Society — has confirmed that there is no evidence of risk to human health from GM crops. In 2001, the research directorate of the EU commission released a summary of 81 scientific studies financed the EU, and conducted over a 15-year period: none found evidence of harm to humans or to the environment.

Researchers at PG Economics studied the global effects of GM crops (”Global Impact of Biotech Crops“), and concluded that the “environmental impact” of pesticide and herbicide use in GM-growing countries had been reduced by 15% and 20% respectively. Energy-intensive cultivation is being replaced by no-till or low-till agriculture. More than a 1/3 of the soya bean crop grown in the US is now grown in unploughed fields. Apart from using less energy, avoiding the plough improves soil quality, causes less disturbance to life within it and diminishes the emission of methane and other greenhouse gases. The study concluded that “the carbon savings from reduced fuel use and soil carbon sequestration in 2005 were equal to removing 4m cars from the road….”

James Lovelock has estimated that if all farming became organic, we would only be able to feed 1/3 the present world population.

“The real GM food scandal,” by Dick Taverne