Karthik Shashidhar

Karthik Shashidhar is Resident Quant at Takshashila, author of Between the buyer and the seller, Director at Bespoke Data Insights and columnist at Mint. His “main blog” can be found at http://noenthuda.com and he tweets @karthiks

Social Capital and Caste

by

Conventional wisdom is that social capital in India is low because of our historical caste system. By placing people in a rigid hierarchy, and giving some people privileges over others just because of the families they were born into, the caste system prevented people from cooperating as well as they would in a more equitable society – that is what conventional wisdom says.

However, a point that we cannot miss is that despite the caste system placing a hierarchy on people, people from different castes did regularly cooperate and trade with each other. In fact, with caste being tied to hereditary professions, people had little choice but to regularly interact and trade with people from other castes. And this inevitably created social capital.

Putting it differently, the result of the caste system was an unequal but stable society, and this stability led to reasonably good social capital (history might be biased given it was written by people from certain castes, but we don’t see many instances of caste riots or clashes from over 200 years ago). You can think of it as a stable society with “handicaps”, where some people were privileged over others (in fact, there was a hierarchy of privilege), to the extent that it was okay for some people to abuse others in various ways.

Over the last 150 years or so, the caste system has been (rightly) challenged, and we are seeing various movements towards a more equal society. One side effect of this has been that the (unequal) equilibrium that had existed has been disturbed, leading to caste-based antagonism and a fall in social capital.

We are in the process of moving from one (unequal) equilibrium to another (more equal) equilibrium, but until we get there, existing beliefs and biases will continue to be challenged, which means some sets of people will continue to be suspicious of others, and there will be mistrust and thus low social capital.

Scott Alexander, Bryan Caplan and Nitin Pai on fighting crime (feat. Matt Levine)

by

The basic idea is that coming down hard on a small number of high-profile crimes can have disproportionate effects in terms of curbing crime

It all started with the pseudonymous blogger Scott Alexander, in what seemed like a justification of outrage. Or maybe it started earlier – with a post by Bryan Caplan deploring outrage. Caplan was commenting about the propensity of people to jump on to bandwagons deploring seemingly minor crimes while not caring enough about worse crimes that were not in the public spotlight already. Caplan had then written:

I can understand why people would have strong negative feelings about the greater evil, but not the lesser evil. But I can’t understand why people would have strong negative feelings about the lesser evil, but care little about the greater evil. Or why they would have strong negative feelings about one evil, but yawn in the face of a comparable evil.

Now, while “Alexander”‘s response seems to justify outrage (and I’m no fan of online outrage), he did so with an interesting analogy, on how to curb crime when the police has limited resources. He writes:

[…] the police chief publicly commits that from now on, he’s going to prioritize solving muggings over solving burglaries, even if the burglaries are equally bad or worse. He’ll put an absurd amount of effort into solving even the smallest mugging; this is the hill he’s going to die on.

Suppose you’re a mugger, deciding whether or not to commit the first new mugging in town. If you’re the first guy to violate the no-mugging taboo, every police officer in town is going to be on your case; you’re nearly certain to get caught. You give up and do honest work. Every other mugger in town faces the same choice and makes the same decision. In theory a well-coordinated group of muggers could all start mugging on the same day and break the system, but muggers aren’t really that well-coordinated.

The police chief’s public commitment solves mugging without devoting a single officer’s time to the problem, allowing all officers to concentrate on burglaries. A worst-crime-first enforcement regime has 60 crimes per day and solves 10; a mugging-first regime has 30 crimes per day and solves 10.

And then it is again Caplan’s turn to respond. I’m bad at detecting satire, so I’m not sure if he is being serious (I don’t think he is). But he proposes a “sure fire way to end all crime”:

Step 1: Credibly announce that all levels of government will mercilessly prosecute the first crime committed in the nation each day.

Step 2: There is no Step 2.

But then, I’m sure that Nitin Pai is being serious in proposing a similar method to curb the spate of violent crime in India based on WhatsApp forwards. In his piece for the Quint, he writes:

the Home Ministry ought to use its considerable powers to tackle the problem. It’s not hard either. One well-advertised arrest, prosecution and sentencing will deter the cowards that comprise lynch mobs. Three high profile arrests and prosecutions – and see how quickly lynchings stop. The smallest police station in the remotest village can stop lynchings if the local sub-inspector has received clear political messages against it.

Finally, the reason why I figured Caplan’s “solution” is satire is because of this passage from Matt Levine’s excellent Money Stuff newsletter (likely it’s behind a Bloomberg paywall, but it’s free if you subscribe by email). Commenting about high frequency trading, Levine writes:

But the answer in actual U.S. market structure is, come on, there is no such thing as “the same time.” Do you know how many nanoseconds there are every single second? (A billion.) The odds that each of us would hit the “Buy” button at the exact same nanosecond are infinitesimal. So if I put in my order to buy the stock at 10:45:06.543210876 a.m., and you put in yours at 10:45:06.543210987 a.m., then I got there first and I win.

Is this a good answer? It has a simple appeal. It just gets rid of the question “who gets the stock if we put our orders in at the same time?” It replaces an economic question about how to allocate the stock with an empirical question of who got there first.

So the problem with fighting the first crime of the day, or year, or whatever, is that a criminal will know fully well, given a reasonably high enough crime rate, that the probability of his crime being recorded as the first in the year or day or whatever is less than one. And the higher the crime rate, the lower the probability that his crime will be recognised as the first one. And so there is a high chance he can get away with it.

And that is where Nitin’s idea scores. Rather than going after the “first crime”, pick a few crimes arbitrarily and “go after them like hell”. Since in this case most of the people who are forwarding dangerous forwards are “ordinary people”, this will likely shake them up, and we’ll see less of these dangerous forwards.

 

Why AI will always be biased

by

Out on Marginal Revolution, Alex Tabarrok has an excellent post on why “sexism and racism will never diminish“, even when people on the whole become less sexist and racist. The basic idea is that there is always a frontier – even when we all become less sexist or racist, there will be people who will  be more sexist or racist than the others and they will get called out as extremists.

To quote a paper that Tabarrok has quoted (I would’ve used a double block-quote for this if WordPress allowed it):

…When blue dots became rare, purple dots began to look blue; when threatening faces became rare, neutral faces began to appear threatening; and when unethical research proposals became rare, ambiguous research proposals began to seem unethical. This happened even when the change in the prevalence of instances was abrupt, even when participants were explicitly told that the prevalence of instances would change, and even when participants were instructed and paid to ignore these changes.

Elsewhere, Kaiser Fung has a nice post on some of his learnings from a recent conference on Artificial Intelligencethat he attended. The entire post is good, and I’ll probably comment on it in detail in my next newsletter, but there is one part that reminded me of Tabarrok’s post – on bias in AI.

Quoting Fung (no, this is not a two-level quote. it’s from his blog post):

Another moment of the day is when one speaker turned to the conference organizer and said “It’s become obvious that we need to have a bias seminar. Have a single day focused on talking about bias in AI.” That was his reaction to yet another question from the audience about “how to eliminate bias from AI”.

As a statistician, I was curious to hear of the earnest belief that bias can be eliminated from AI. Food for thought: let’s say an algorithm is found to use race as a predictor and therefore it is racially biased. On discovering this bias, you remove the race data from the equation. But if you look at the differential impact on racial groups, it will still exhibit bias. That’s because most useful variables – like income, education, occupation, religion, what you do, who you know – are correlated with race.

This is exactly like what Tabarrok mentioned about humans being extremist in whatever way. You take out the most obvious biases, and the next level of biases will stand out. And so on ad infinatum.

Cross posted from my personal blog

“Easing” Cancellation Will Lead to Higher Air Fares

by

Mint reports that the Union Civil Aviation Ministry is seeking to “ease rules for air ticket cancellation” in a bid to make air travel more customer-friendly. According to the draft rules,

  • Passenger allowed Lock-in option for 24 hours(after booking ticket) in which the passenger can cancel or amend the ticket without any additional charges.

While at first sight this might look like a passenger friendly move, it is likely to result in an overall increase in air fares.

I have argued before in Pragati that a reservation to travel consists of two instruments – the travel itself and the option to travel on the said route on the said day and time. In other words, the cancellation fees can be looked at as an option premium paid by the customer to exercise an option to travel on the particular route on the particular day.

When a ticket gets cancelled, the customer is effectively choosing to not exercise her option to travel. So it is fair that they not pay the cost of travel itself, and be refunded that amount. The reason travel companies levy a cancellation charge is to compensate them for the cost of the option to travel (the price of an option doesn’t depend on whether the holder chooses to exercise it).

The proposed regulation by the Civil Aviation Ministry requires airlines to offer this option for free for a limited period of time (24 hours after booking). While 24 hours may not be a high number, it can still result in people taking advantage of the free option by making bookings that they may later cancel or reschedule. And the airlines will want to get compensated for the free option they are providing.

It is likely that they will achieve this compensation by adjusting prices elsewhere – such as the price of travel itself or the price of the options where there is no price cap. And this is likely to hurt passengers.

All the new regulations from the Civil Aviation Ministry will achieve is to redistribute from passengers with firm schedules (who are more likely to be “retail customers”, from the middle class, etc.) in favour of those who may want to keep their schedules open for a day (more likely to be premium, corporate customers).

Once again invoking Ravikiran Rao, #thatzwhy we need strong regulations.

Dancing Hens and Rorschach Tests

by

So campaigning has ended ahead of the Karnataka elections to be held on Saturday. So this is a good opportunity to let voters in Bangalore know the “shapes” of their constituencies, if it is going to have any impact on their voting decisions.

Here is what the 25 constituencies that lie entirely within the Bruhat Bangalore Mahanagara Palike (BBMP) limits look like. You are encouraged to make your own guesses on what each constituency looks like.

The “shapes” of various constituencies in Bangalore.

For one, Padmanabha Nagar (which is where my house is situated, but where I don’t vote) looks like “a hen doing ballet” as Thejaswi Udupa once described it a few years back. Malleswaram, which is next to it in the above grid, looks like a hen sitting down (according to me). Rajarajeshwari Nagar, which covers a huge swathe of land in the Western suburbs looks like a cartoon character. And I won’t say much about Shanthi Nagar (the colour scheme in the graph denotes the population density of the BBMP wards that form the constituency).

The reason we have such weird shapes is because of gerrymandering – lines having been drawn arbitrarily at some point in time to help some incumbent party. These constituencies were used for the first time in the 2008 state elections (following delimitation earlier that year), and they lie along the same lines as BBMP wards (in fact, a given BBMP Ward contributes to only a single constituency).

Have fun with your interpretations!

The Government Should Regulate Cooks

by

Yet another wedding, yet another truckload of wasted food. If, in reality TV show style, we were to try to identify the “root cause” in this instance, it was the cook (or the team of cooks, rather). Each of the seven respondents this correspondent surveyed expressed their displeasure at the quality of the food. One even called it her “worst ever Indian wedding dinner”.

This wedding was only one isolated instance – it is all too common an occurrence in these parts for copious amounts of food to be wasted all because of a cook who ended up cooking badly. And it is all the fault of the cooks, most of whom have never gone to culinary school (we don’t have too many of those in India), and many of whom haven’t gone to school either.

When thousands of people in India die of hunger everyday, and farmers continue to kill themselves in Vidarbha (and elsewhere), this wastage of food is indeed criminal. It comes at a high human cost. And that it comes out of sheer incompetence of unregulated cooks makes it indeed tragic.

There is only one solution to this – the government should regulate cooks. Not just wedding cooks – since wastage of food at weddings and other parties are only part of the problem – the government should regulate anyone who wants to cook. The other day my daughter refused to eat an idli. We decided to salvage our karma by feeding it (the idli) to the neighbourhood street dog, who took one bite and promptly ran away.

Whether you want to make yourself a 2-minute Maggi, or Shantavva in Santemarahalli wants to make a ragi ball, or chef Madhu Menon (hope he doesn’t edit this bit out) wants to make bloggers’ b***, you should need a licence from the government, which certifies that you are a cook of a high enough quality that what you cook will not go waste.

That’s the only way we can save millions of our population from hunger. There is already enough wastage of food because farmers cannot coordinate on what to grow, and because of inefficiencies in the food supply chain, and because of the way agricultural markets are regulated. We don’t want badly cooked food to add to the wastage. And the only way to ensure that is by having the government regulate cooks.

PS: As Ravikiran Rao, a former editor of the former avatar of this publication, likes to put it, “#thatzwhy we need strong regulation”

PS2: Some readers might be advised to consume irony supplements along with this article

EPFO Releases Payroll Data

by

The Employees Provident Fund Office has, for the first time, released data on payroll enrolment in India. This data shows, by age group, the number of enrolments with the office by month, and this is the first instance that we’re having such data being available.

While it would be easy to start those “data science machines” churning to process this data right away, a closer look suggests a more careful approach.

Screenshot source: Somesh Jha on Twitter https://twitter.com/someshjha7/status/989095752411570176?s=12

Firstly, the data for September 2017 for the 22-25 age group is clearly an error, being an order of magnitude lower than the number for the same age group in all subsequent months. Hopefully this will be corrected in a subsequent release.

Next, what explains the age bands? Why do we have 18-21 and 22-25 (4-year bands) and then a 3 year age band (26-28), and a 7-year age band (29-35)? And why is everyone in the 35+ age group put together into one band?

Then, the note attached to the data release states that this includes temporary employment as well. While the number of enrolments of temporary employees might be low, it would have been far more useful to have that data separately.

Notwithstanding all this, the publication of this data is welcome, since the Indian policy environment is so data-poor that any new data release is welcome! It is fair to expect that these errors will get corrected in time, and this might yet become a great source of data on formal employment in India.

 

Incels and Tinder Taming

by

When I read Amit Varma’s post on Incels, I couldn’t help but think of this piece I’d come across while doing research for my book Between the buyer and the seller.

Written by Dustin Silgardo in Man’s World, this piece talks about Incels (yay, now I can use that word!) in India, and how dating apps such as Tinder have suddenly laid (no pun intended) bare the possibility that a large section of Incels in India can’t get dates because nobody wants to date them.

Silgardo writes:

In the online dating world, where men outnumber women by close to three to one, men, thus far protected by the perceived power a patriarchal society heaps upon them, are being forced to face an inconvenient possibility: perhaps they are just not that attractive.

And this:

Indian men, on the other hand, are sheltered from this truth and are cocooned by the promise of a dainty woman served to them on a platter, via an arranged marriage. This complete lack of awareness that Indian men seem to have of their own sex appeal is quite apparent from some profiles on Tinder.

Go read the whole piece. It will give you excellent insight into the world of Indian Incels.

And while you’re at it, read the part of my book where I used this article by Silgardo as well! And hopefully you’ll like that, in which case you might want to read my whole book (tongue in cheek)!