Comments for V-blog http://vivekmohta.com/blog Vivek Mohta's blog Thu, 16 Jul 2009 09:52:47 +0000 http://wordpress.org/?v=2.0.2 Comment on Forecasting Presidential elections by Rob Chhabra http://feedproxy.google.com/~r/vivekmohta/comments/~3/8kbyMJsLWlo/ Tue, 09 Oct 2007 17:20:30 +0000 http://vivekmohta.com/blog/2007/05/10/forecasting-presidential-elections/#comment-678 I have read and seen data that show a market based approach to forecasting elections is most accurate. In particular a website such as tradesports.com has a had more accuracy in predicting the outcomes in elections than national polls. I have read and seen data that show a market based approach to forecasting elections is most accurate. In particular a website such as tradesports.com has a had more accuracy in predicting the outcomes in elections than national polls.

]]> http://vivekmohta.com/blog/2007/05/10/forecasting-presidential-elections/#comment-678 Comment on Forecasting Presidential elections by Ben http://feedproxy.google.com/~r/vivekmohta/comments/~3/fAOeBxxO0Sc/ Tue, 21 Aug 2007 19:32:29 +0000 http://vivekmohta.com/blog/2007/05/10/forecasting-presidential-elections/#comment-413 The reason in favor of prediction markets is that they should incorporate all the other information out there. Maybe polls are important or fundamentals, but at any given point, the participants bidders-sellers in the marekt should use those data to set the price. You really just need a few informed participants to get the correct price. The reason in favor of prediction markets is that they should incorporate all the other information out there. Maybe polls are important or fundamentals, but at any given point, the participants bidders-sellers in the marekt should use those data to set the price. You really just need a few informed participants to get the correct price.

]]> http://vivekmohta.com/blog/2007/05/10/forecasting-presidential-elections/#comment-413 Comment on Adaptive strategies for climate change by Ben http://feedproxy.google.com/~r/vivekmohta/comments/~3/6Ujf5-KNlKw/ Tue, 21 Aug 2007 19:30:00 +0000 http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-412 The Fed’s decisions do have huge consequences and huge uncertainties and my sense is that the Fed–and other independent bodies–have greater public trust than Congress. Fair enough. But the Fed's mandate at least is clear by statute. To minimize inflation and unemployment. The rest of what it does, the public is not qualified to decide. It is not clear what the correct mandate should be in the context of climate change. The Fed’s decisions do have huge consequences and huge uncertainties and my sense is that the Fed–and other independent bodies–have greater public trust than Congress.

Fair enough. But the Fed’s mandate at least is clear by statute. To minimize inflation and unemployment. The rest of what it does, the public is not qualified to decide.

It is not clear what the correct mandate should be in the context of climate change.

]]> http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-412 Comment on Adaptive strategies for climate change by Vivek Mohta http://feedproxy.google.com/~r/vivekmohta/comments/~3/L3BwaMqjdkE/ Thu, 16 Aug 2007 06:34:28 +0000 http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-400 Devesh, I think the primary uncertainty in the target emissions level originates from our lack of understanding of the climate system. If we find that the climate has more positive feedback loops than expected and is heating up faster than our earlier models suggested, then we might need to recalibrate our policy. I think Ben's estimate of 5 years is good. That is about how often the <a href="http://www.ipcc.ch/about/about.htm" rel="nofollow"> IPCC updates its assessment </a>. I also agree with Ben that signaling certainty to markets is crucial. Ben, I was surprised by your comment that <blockquote> Also not sure I would trust decisions to be made by an independent body. Such decisions have huge consequences with huge uncertainties, and nebulous benefits like “setting an example for the world”. That is not something I would trust a political appointee to decide (unless it were me of course). </blockquote> The Fed's decisions do have huge consequences and huge uncertainties and my sense is that the Fed--and other independent bodies--have greater public trust than Congress. Devesh,
I think the primary uncertainty in the target emissions level originates from our lack of understanding of the climate system. If we find that the climate has more positive feedback loops than expected and is heating up faster than our earlier models suggested, then we might need to recalibrate our policy.

I think Ben’s estimate of 5 years is good. That is about how often the IPCC updates its assessment . I also agree with Ben that signaling certainty to markets is crucial.

Ben,
I was surprised by your comment that

Also not sure I would trust decisions to be made by an independent body. Such decisions have huge consequences with huge uncertainties, and nebulous benefits like “setting an example for the world”. That is not something I would trust a political appointee to decide (unless it were me of course).

The Fed’s decisions do have huge consequences and huge uncertainties and my sense is that the Fed–and other independent bodies–have greater public trust than Congress.

]]> http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-400 Comment on Forecasting Presidential elections by Vivek Mohta http://feedproxy.google.com/~r/vivekmohta/comments/~3/jPRuyJLRomI/ Thu, 16 Aug 2007 06:21:20 +0000 http://vivekmohta.com/blog/2007/05/10/forecasting-presidential-elections/#comment-399 Ben, My impression is that prediction markets are effective in certain contexts and less so in others. In particular, I think prediction markets are better at integrating sentiment than polls a week before a general election. However, for a primary election months away, prediction markets are quite volatile, just like the polls. In addition, prediction markets require input from other people while the methods referred to in this post attempt to make predictions based only on the more stable "fundamentals." In the end, you might be right that none of the methods based solely on the fundamentals are compelling. Ben,
My impression is that prediction markets are effective in certain contexts and less so in others. In particular, I think prediction markets are better at integrating sentiment than polls a week before a general election. However, for a primary election months away, prediction markets are quite volatile, just like the polls. In addition, prediction markets require input from other people while the methods referred to in this post attempt to make predictions based only on the more stable “fundamentals.”

In the end, you might be right that none of the methods based solely on the fundamentals are compelling.

]]> http://vivekmohta.com/blog/2007/05/10/forecasting-presidential-elections/#comment-399 Comment on Climate policy and the role of experts in decision-making by Vivek Mohta http://feedproxy.google.com/~r/vivekmohta/comments/~3/PN133w4Lkco/ Thu, 16 Aug 2007 05:39:07 +0000 http://vivekmohta.com/blog/2007/01/27/climate-policy-and-the-role-of-experts-in-decision-making/#comment-398 Ben, In looking back at my post, I clearly should have included your point-- that the economy is also a complicated dynamical system and we ought to defer to economists on how we might expect the economy to evolve in response to policy choices. (There might be some challenges here in that, in general, there seems to be less consensus in economics than in the earth sciences.) Policy makers often don't understand either of the complexities or choose to ignore them. Perhaps more education is necessary or perhaps a culture of humility and respect for knowledge. I also agree that trade-offs must be presented in a way that the public understands. Rarely do policy choices have only an upside. A good political leader ought to be able to communicate trade-offs clearly and honestly to the public. Ben,
In looking back at my post, I clearly should have included your point– that the economy is also a complicated dynamical system and we ought to defer to economists on how we might expect the economy to evolve in response to policy choices. (There might be some challenges here in that, in general, there seems to be less consensus in economics than in the earth sciences.)

Policy makers often don’t understand either of the complexities or choose to ignore them. Perhaps more education is necessary or perhaps a culture of humility and respect for knowledge.

I also agree that trade-offs must be presented in a way that the public understands. Rarely do policy choices have only an upside. A good political leader ought to be able to communicate trade-offs clearly and honestly to the public.

]]> http://vivekmohta.com/blog/2007/01/27/climate-policy-and-the-role-of-experts-in-decision-making/#comment-398 Comment on Adaptive strategies for climate change by Ben http://feedproxy.google.com/~r/vivekmohta/comments/~3/vB_rxYLCKsA/ Wed, 18 Jul 2007 15:18:18 +0000 http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-295 My understanding is that the uncertainty is primarily based on lack of knowledge. So it is the pace of scientific/economic knowledge that dictates. No particular reason it needs to be recalibrated too often. 5-10 years sounds about right. You need to give investors long lead time to reduce their uncertainty in planning. Most government policies take a long time to recalibrate. (Like CAFE for example) That leads to small inefficiencies, but nothing substantial. My understanding is that the uncertainty is primarily based on lack of knowledge. So it is the pace of scientific/economic knowledge that dictates.

No particular reason it needs to be recalibrated too often. 5-10 years sounds about right. You need to give investors long lead time to reduce their uncertainty in planning.

Most government policies take a long time to recalibrate. (Like CAFE for example) That leads to small inefficiencies, but nothing substantial.

]]> http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-295 Comment on Adaptive strategies for climate change by Devesh http://feedproxy.google.com/~r/vivekmohta/comments/~3/NmYwjofS0JA/ Wed, 11 Jul 2007 14:44:09 +0000 http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-277 For those of you that know more about climate science / policy than I do, you can help me out. I understand that global climate change itself is filled with uncertainties on virtually all dimensions. I also know that there is uncertainty on what a target emission output ought to be. What I do not understand, is the dynamic nature of this uncertainty over time. That is, once we make a guess and set a target emissions output, how often would we change it? Several times a year? A decade? What drives the changing of the output level? For those of you that know more about climate science / policy than I do, you can help me out.

I understand that global climate change itself is filled with uncertainties on virtually all dimensions. I also know that there is uncertainty on what a target emission output ought to be. What I do not understand, is the dynamic nature of this uncertainty over time.

That is, once we make a guess and set a target emissions output, how often would we change it? Several times a year? A decade? What drives the changing of the output level?

]]> http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-277 Comment on Climate policy and the role of experts in decision-making by Ben http://feedproxy.google.com/~r/vivekmohta/comments/~3/kkhPNwAqIUg/ Tue, 10 Jul 2007 22:59:09 +0000 http://vivekmohta.com/blog/2007/01/27/climate-policy-and-the-role-of-experts-in-decision-making/#comment-275 Sort of, though I caution that the trade offs must be presented in a way that the public understands. Just like some ignore scientific consensus on climate change, most scientists are completely ignorant of and willfully ignore economic consensus on climate change economics. Many of Al Gore's proposed policies are incredibly economically wrong headed. Actually, the policies proposed by most policy makers are. Perhaps more education is necessary. Sort of, though I caution that the trade offs must be presented in a way that the public understands.

Just like some ignore scientific consensus on climate change, most scientists are completely ignorant of and willfully ignore economic consensus on climate change economics.

Many of Al Gore’s proposed policies are incredibly economically wrong headed. Actually, the policies proposed by most policy makers are.

Perhaps more education is necessary.

]]> http://vivekmohta.com/blog/2007/01/27/climate-policy-and-the-role-of-experts-in-decision-making/#comment-275 Comment on Adaptive strategies for climate change by Ben http://feedproxy.google.com/~r/vivekmohta/comments/~3/CxbPGs-g4W0/ Tue, 10 Jul 2007 19:43:00 +0000 http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-274 If you are constantly readjusting, that takes away one of the main benefits of a tax vs a cap and trade. In a world without uncertainty, a tax and cap and trade are mathematically equivalent. It is uncertainty that makes a tax preferable. Also not sure I would trust decisions to be made by an independent body. Such decisions have huge consequences with huge uncertainties, and nebulous benefits like "setting an example for the world". That is not something I would trust a political appointee to decide (unless it were me of course). If you are constantly readjusting, that takes away one of the main benefits of a tax vs a cap and trade.

In a world without uncertainty, a tax and cap and trade are mathematically equivalent. It is uncertainty that makes a tax preferable.

Also not sure I would trust decisions to be made by an independent body. Such decisions have huge consequences with huge uncertainties, and nebulous benefits like “setting an example for the world”. That is not something I would trust a political appointee to decide (unless it were me of course).

]]> http://vivekmohta.com/blog/2007/06/21/adaptive-strategies-for-climate-change/#comment-274