Knowing and Making

The Economist is running a one-hour chat session on the #askeconomist hashtag today, which I'd recommend for some thought-provoking questions. My own interest, of course, is in the behavioural, cognitive and information-processing aspects of this. Two particular questions are relevant: Rational people would apply an appropriate level of skepticism to crowdsourced news; weighting its credibility according to who the messenger is, by the number of times the same message has been recycled or retweeted, by the number of independent sources. But real people do not. Psychology tells us that we inevitably overweight a message the first time we hear it (anchoring), and by the degree to which it confirms our prior beliefs (confirmation bias). The role of a professional journalist, in part, is to check facts and give us appropriate caveats on how much we should believe what we're told. How can this be done in the world of participatory journalism? Maybe we can develop automated to...

Two independent observations of a new trend today. First on twitter: Then on Marginal Revolution : Kate is very well-versed in the British newspaper industry (I used to adore her TV listings in the FT), but I had no idea that the Mail's reputation had spread even to Tyler Cowen's parish.

I had a nice email from the FT today in response to this previous item (posted with permission): Hi Leigh Sorry to hear about your recent FT.com subscription problems. I thought I might try and explain a couple of the oddities you encountered in your renewal process. When we moved to a 'metered' access model for FT.com in November 2007, we upgraded all of our long-standing customers, like yourself, to the newly-created 'Premium' service level. We did this so that you wouldn't lose access to parts of the site, like Lex, that had been included in your old subscription package. Naturally, we kept you on the same 'old' rate. By the time your subscription fell due for renewal, your 'old' rate had fallen considerably behind the £25.99 a month we charge new 'Premium' subscribers, and even behind the £17.50 we charge new 'Standard' subscribers. Fortunately, you have a long history as a customer of the Financial Times and therefore qualify f...

I'm stretching a point to make an economic connection on this post, but Nick Rowe has had a couple of items recently relating to infinity. This news item , on the other hand, evokes a much more potent image: He said his design means patients can have their modesty covered but still allow medics immediate access through clever "entrance points" in the gown. "It's infinitely dignified, yet practical. And Velcro doesn't enter into the equation." While we're on the BBC news website, take a look at the new regulatory powers now available to soap opera actors: Finally while researching a previous posting , I came across this gem : Senior sources at the FT have confirmed that the group is in discussions with a number of payment processor companies to establish a simple " one-lick " procedure that would enable consumers to pay a small fee for single articles that would otherwise be available only to subscribers. I can't wait for that...

I was on BBC World this morning to discuss the latest UK GDP figures and why the UK is the last major economy still in recession (hoping to get a clip to upload later). Here is a summary of my views, some of which I got across in the interview. Any of these could be an article in themselves, but there isn't much time to discuss them on an hourly business news update! Our recession has been worse mainly because we are dependent on the financial sector. We did very well out of this before the recession, but having reached a higher peak we had further to fall. However, employment figures have been relatively very healthy, meaning that the pain of the recession has been less than it could have been. Also, fiscal and monetary action have mitigated the risk of a deeper depression. We are now gradually edging out of recession but there is a risk that tax rises and government spending cuts will put a brake on growth. To combat this, continued aggressive monetary policy is needed. Becau...

They asked me about November's record budget deficit of £20.3 billion, about which George Osborne has said that "Gordon Brown is maxing out the nation's credit card". My response, briefly: Sometimes it's appropriate to run up your credit card to tide yourself over a problem - the recession definitely qualifies. Government spending is a pretty mainstream response to help mitigate an economic downturn. Spending cuts and tax rises might make a small difference, but the thing that will really cover the debt is economic growth. The UK's tax take is especially countercyclical and will rise sharply when GDP growth and profitability return. The return of VAT to 17.5% in twelve days will make some impact in itself (raising about £12 billion), but might be more valuable as a credibility device: the government showing investors and markets that they are serious about getting the deficit under control. If you're interested, the recording is here .

Media owners are salivating over the idea that Microsoft is going to save them in a hugely expensive attempt to compete with Google. " Microsoft makes move to cut out Google " in the FT: "Microsoft are doing exactly the right thing and asking exactly the right questions," Richard Titus, chief executive of Associated Northcliffe Digital. "Any competition to Google is a good thing," one UK publisher said. Tom Curley, chief executive of the Associated Press, said last month that Microsoft was willing to accept “principles” such as favouring AP stories in search results over others that regurgitate its news, or helping it track its content. “We are only going to work with those who use our principles,” he added. “We stand at an enviable moment where Microsoft and Google have decided to go to war,” he said. You can smell the desperation of people whose business model has been overthrown - not by any underhand behaviour or cheating from Google, but by a world wh...

I was "alerted" to this "news" story by cboyack on twitter, whose posts I am starting to get a little annoyed by. Imagine that a bill was introduced in Congress providing for National Emergency Centres to be set up: "to provide temporary housing, medical, and humanitarian assistance to individuals and families dislocated due to an emergency or major disaster." Three additional purposes are specified in the text of the proposed legislation: To provide centralized locations for the purposes of training and ensuring the coordination of federal, state and local first responders; To provide centralized locations to improve the coordination of preparedness, response and recovery efforts of government, private, not-for-profit entities and faith-based organizations; To meet other appropriate needs, as defined by the secretary of homeland security. Would you think that was particularly unreasonable? Would you, in fact, consider it a threat to democracy? I don'...