Tom Pepinsky

Author: tompepinsky

  • Something New: Research Posts

    We’re going to try something new here at Indolaysia. Rather than just posting abroad–which means lots of posts smashed together, but lots of time in between trips–I’ll try to post a bit more frequently on research-related topics. Not too often; I generally come up with about two new pieces of research per year, which isn’t much. But I think there’s an argument for using this space for some more discussion of Indolaysia-related professional matters. I also think it high time that I worked harder communicating my research to broader audiences (like the readers of this blog, which include I think my mom and two other people).

    So that introduces today’s post, a discussion of my latest paper, first presented at ANU, most recently presented at APSA in Seattle last month, and this month to be presented at Temple and UCSD. I’m calling this paper “Islam, Ethnicity, and Global Engagement.” The idea behind the paper is that we don’t know a lot about public opinion in the Muslim world towards the United States. The problem is not that there’s no research on this, but rather that the research that’s out there asks questions the wrong way. We tend to think “do Muslims in, say, Indonesia prioritize relations with the West or with the Muslim world?” Asking a question this way implies a binary opposition between the two choices. It’s entirely possible that Muslims like both. In fact, our experience in Indonesia suggests that most globally aware Muslims are pretty keen on both the West and the Muslim world. If you force these two to be mutually exclusive, you’ll get answers but they won’t make sense conceptually.

    Then add in the idea that most Muslims probably don’t actually foreign relations in terms of just the West or the Muslim world. In most of Muslim Asia and Africa, regional engagement is at least as important.  It’s an obvious point when you think about it, but this isn’t often taken into account when we do research. But it has important consequences. If you find that Muslims in Indonesia prioritize relations with the Muslim world and not with the West, that might mean that they are something like “Islamists.” But it also could mean that they’re just “anti-Western,” which need not mean the same thing. If you added a third group, like Southeast Asians, then you could distinguish between the two possibilities. If they are equally keen on SEA and the Muslim World, that suggests that they’re anti-Western in general; if they prioritize the Muslim world against both SEA and the West, then it suggests that Islam means something.

    The point of “Islam, Ethnicity, and Global Engagement” is to highlight these important issues, first, and second, to propose a way to model them statistically. I propose a way to study questions like these, which I denote as multidimensional non-exclusive ordered choices, that allows me to add third (and fourth, and fifth…) dimensions into this question–so I don’t have to assert that only the Muslim world or the West are relevant to ordinary Muslims. At the same time, I can test whether the various identity dimensions are mutually exclusive rather than assuming that they are (or are not). And finally, I show how to use this method to compare the ways in which, say, religiosity or ethnicity or other factors shape the collection of beliefs about different kinds of countries. I use really neat Indonesian survey data to do this.

    The benefit of all of this is that I can make pictures like this.

    temple

    This shows that more pious Indonesian Muslims (pious in a sense that I define in the paper) are indeed more likely to place a high priority on strong relations with the Muslim world than less pious Indonesians are. But this does not imply that they are less likely to place a high priority on strong relations with the West–piety doesn’t affect that at all. Then you add Southeast Asia into the mix, and piety has the relationship to Southeast Asia as to the Muslim world. You’d miss all of this if you asked “the West or the Muslim world.”

    The point: the world is complex, much like we thought. But we can discipline that complexity and learn about it if we use the right tools.

  • Stabilization Games Revisited

    OK, since my body clock still thinks I’m in Australia, I (TP) think it’s OK to violate our no-posting-in-the-US rule for just this once, to follow up on my earlier post on the debt ceiling.

    The question here is, how did my little model do? The answer is, good not great. There are a couple of issues here. The outcome–a near complete capitulation by the Ds to the Rs–is not my final prediction, so that’s not good. But there are several reasons why a little model might not predict reality.

    • The model is wrong somehow. I don’t think is it. For what I intended the model to do, I think it stands up very well in explaining the essential logic of the debt ceiling crisis. The logic of the positions is correct, from what I can tell. It’s just that the Rs stood firmer than I anticipated, a prediction which only comes out informally at the very end of my discussion.
    • The model makes technical simplifications. This is part of it: due to the fact that I’m not any good at math I only entertained a 2×2 game structure with discrete strategies (vote yes or no), and clearly any actual debt ceiling negotiations involved negotiations allowing for continuous strategies. The model sacrifices reality to be more tractable, with obvious consequences.
    • Actual events are random draws from a distribution of possible outcomes. Maybe relevant too. This is what ever good poker player knows, and most critics of formal theories of politics forget. Think about it this way: if you’re playing no limit Hold ‘Em and find yourself raising pre-flop with pocket aces, but get beat by someone who flops a boat, you probably didn’t make a mistake by raising pre-flop, you just got a bad beat.
    • People aren’t rational. Possible. I think in the case of Obama himself, there’s evidence that he is not responding to incentives and new information about his opponents in a way that a rational Bayesian learner would. He seems to believe things about the Rs’ willingness to compromise that don’t seem compatible with reality. [ed.–Would love MGr’s and MGl’s reactions to this claim.] Beyond that, everyone else seems pretty rational to me.
    • Games are nested. I think that this the real issue. We can’t forget that the final debt ceiling crisis is part of a much larger game between the Ds and the Rs, and a lot of the relevant considerations for players calculating optimal strategies are external to the specific vote on whether or not to raise the debt ceiling and the small number of parameters I’ve included. I’ve long thought that the very fact that we had a debt ceiling crisis at all means that the Ds had already lost the ability to make and defend coherent economic policy positions. I just thought that they would stand firm.

    The good news, as I mentioned before, is that in capturing the essence of the interactions between Ds and Rs over the debt ceiling, and understanding why the crisis looked the way that it did and lasted as long as it did, my exposition does well.

    The real news now though is the market reaction (not great) and the subsequent economic data which has been released (very discouraging). What is striking to me now is a point to which I alluded earlier: the complete and utter refusal of US politicians to advocate for a coherent policy response based on basic economy theory. We used to know that when interest rates were really low but banks still weren’t lending and the economy was still stalled, governments should spend. Today, no politician–not a D, not an R, not a president–is willing to take this position. Instead, Washington is obsessed with debt and tax cuts. The reason why no politician will explain to you precisely why cutting taxes and decreasing spending over the next 20 years will help the US economy over the next 5 is because, well, it won’t.

    There are various reasons for our politicians’ current ignorance. One is the really terrible state of economic literacy among the Americans. Lots of people study business in college, fewer study macroeconomics. The really smart ones who do study macroeconomics work in the financial sector, not politics, and they are screaming for more government spending right now. One is that macroeconomics is difficult, and that leads people to try to look for analogies in how you run a national economy in how they run their household or their small business, which create a huge fallacy of composition (if your household is almost bankrupt you should stop borrowing, and that is not necessarily true if you’re a national economy). One is possibly naked greed, but I don’t think that that is it really, because a greedy person would be willing to trade a higher tax bracket for a much higher income (which a good economy will give you), and that doesn’t seem to describe the nature of the debate right now.

    But there also might be something in the way that leaders lead. I think that this is important, and not something amenable to game theoretic analysis. I can pick on Obama, but it’s not just his fault, it’s a general problem among the Ds, the party that would have the ability to advocate a classic Keynesian response to the current crisis. They seems unwilling or unable to stand up and recite the lessons of Econ 101.

    UPDATE: Another obstacle to embracing a coherent policy response to our current economic maladies might come from academic economics, in the form of real business cycle theory. For better or for worse, RBCT enjoyed great prestige in the 1980s especially, and its intellectual champions remain active and influential. Simplifying greatly, RBCT starts with the assumption that all markets for goods, labor, and capital clear, which means that the business cycle–that is, the variation around the trend in how economies perform over the long term–must be explained by random shocks (yes, literally) to the economy. You get terms like “adverse technology shocks” to explain why recessions occur (Noah Smith discusses the logical implications of this sort of view applied to the current crisis).  Sneakily, then, economists who follow this line of thinking don’t have to think carefully about the origins of recessions, because they are unanticipated and unpredictable, or else they wouldn’t be random. One additional consequence of this line of thinking is that government action (monetary policy or fiscal policy) can at best do nothing to redress the business cycle. Here is an early, devastating critique from Larry Summers.

    What makes this relevant for my discussion is that this sort of thinking is currently popular among many of the libertarian types of economists who tend to have blogs and lots of readers. The internet and libertarians go together like PB and J. It’s unlikely that many of these people strictly believe that RBCT is a good model; rather, they like the implication that government action can never be useful, and they sort of latch onto RBCT from time to time because that’s one of the things that  RBCT says. Blog readers usually don’t know that ins and outs of the models that produce these predictions but my sense is that they are still influential among the commentariat.