Vacation in Costa Rica!

I'm going to Costa Rica tomorrow for a week.  :)  I knew almost nothing about it except that it's very scenic, and there are lots of coconuts.  So I wrote up a little blog about it on Fold.  I'll be reporting back with my own pictures.

Nirvana in Fire and Chinese history (and some random notes)

After watching Nirvana in Fire I read up a bit more about Chinese history.  Popular narratives in China about Chinese history are especially important to understanding the Chinese perspective on the responsibilities of governments.  I wrote about how this relates to Nirvana in Fire in a Fold story.

In other news, I started trying to read it in Chinese.  The story actually started out as an internet novel.  Then I bought a paperback copy from Amazon.  To my shock, they were not the same!  Thankfully, someone on the internet explains that there are multiple editions because the author typically polishes it when they go to publish the story as a book.  The internet version is the modern equivalent of weekly installments in the newspaper so it's often more long-winded, Dicken's style.

Learning Weird Chinese

My Chinese is getting stranger and stranger because I tend to watch historical fiction shows like Nirvana in Fire (琅琊榜) and Empresses in the Palace (后宫 甄嬛传).

The dialogue in these shows are more formal, maybe kind of like if you learned English from watching only Shakespeare plays.

虽然我学到的中文古怪，我还是喜欢看这个内容的因为故事比现代的故事有意思。一般的现代的戏太莫名其妙了，而且我不太懂中国现在社会的情况。还有，还是古代的服装顺眼。

examples:

原来如此

毕竟

皇上息怒！

皇上精明

儿臣领旨

叩见陛下

何尝不是

冤枉

我要把它们记下来。

Nirvana in Fire

I wrote an essay about a Chinese TV show I have been watching because I wanted to share my thoughts about the themes about patriotism and governance.  I have several shows, and some of these themes have shown up before so that now I feel that I more fully understand the context behind them.

 

The acting is really good.  There are so many great bromances, and it's also really cute that the actors are friends in real life as well.  It's really helped me to improve Chinese, too, since I'm motivated to read Chinese articles about the actors (尤其是胡歌!) and the show.  太好看了但是我的中文也太差了。也没办法了，学到什么就算什么。

 I am also trying out Fold as a platform for interactive blogging. I think I like it! It seems like the feature in Medium where people can comment in your text would be useful, though.

Racial Profiling

I updated my tool for explaining and exploring racial profiling in traffic policing recently. While we can only see the outcome of stops and ticketing, we can explore different scenarios for the true rates of violating traffic under different assumptions about fairness, efficiency, and effort of traffic policing. Hopefully the reasoning is easier to follow now. http://mirthbottle.github.io/rprofiling/

High School Victory Lap in Full

After high school I wrote an essay for the St. Louis Chinese newspaper.  I have blogged about it before, but I realized that I should copy it in full before it disappears from their site at some point.  It is still somewhat embarrassing, but it's still interesting to reread every few years.  Regarding what I wrote about persistence, I had no idea how true that is.  However, I don't know if I still like the discussion about happiness.  I still agree with the gist, but the wording is kind of confusing and pseudo-wise. 

High school. HAHA! because high school = OVER. I laugh a laugh of confidence built over years of insecurity and doubt, a laugh of proud accomplishment, gloating over my luck, of excitement for the future, of sheepishness from excessive praise, but also more caustic laughs of grim irony over the hypocrisy and the shallowness of my apparent worth. I don't suck! Cuz I did it! In fact, I ROCK! College is going to be awesome! And I'm getting cocky! And I'm not even that smart! Just really lucky! And upon that my worth is judged, and for that I get respect! Oh, sad.

So that's what I call my posthighschool reaction. Looking back at the last four years, I feel like it's only been four years, but so much has happened and so fast. I could almost feel myself change and change and change again. When I first began my high school career as a hyperactive, self-conscious adolescent, no one expected me to excel academically or socially. Thus, I did not expect much of myself. When I thought of successful model students, I always thought of it as a standard that did not apply to me. I guess it's strange for me to think of now because I never had any conception about my future because I was afraid too many things would change, and then I would be disappointed if I did not reach my goals. So I never even thought of myself as working towards any standard or model in particular. I didn't think about college seriously until junior year was almost over when it suddenly dawned on me that I didn't even know what state Harvard was in. Yeah...like I ! said, people didn't expect much of me, and so I did not think much of myself.

But actually I did. I didn't always have the confidence in my abilities, but I always yearned to be just as good as the best. In choir, to lead my section; in tennis, to play varsity singles; in math, to win at competitions; even standardized tests, to score with the best, etc. High school, compared with real life, was nice and sheltered. It was a great place to get a head start in competition without serious repercussions if you fail. For example, I never got better than moderately good at speech and debate. However, the coach remained supportive and helped me focus on what to improve. In high school, especially during the first two years, I developed diligence and persistence. Diligence because homework still counts, and persistence because improvement is almost always guaranteed. For the last two years, diligence was for studying even if there was no homework, and persistence for being creatively assertive in finding ways to get something done.

One of the biggest lessons I learned in high school is that persistence pays off. I just needed a goal and a plan, and I almost always got what I wanted. A goal, a plan, and NO FEAR! because there is always the fear of difficulty and the possibility of hidden obstacles and failure. Although you should always be prepared to deal with these difficulties, fear clouds judgment and hinders performance. So am I afraid when I organize events such as a chess tournament and take tests like APs for college credit? I'm TERRIFIED, but I do it anyway. Besides, even when I don't get exactly what I want, things always work out in the end. Thus, I am always prepared to revise my goals to adjust to changing circumstances and new priorities. Consequently, my secret weapons of mass getting-things-done are as follows: a goal, a plan, NO FEAR!, and adaptability.

My goals are derived from my priorities, which were cultivated by my strong sense of self. In high school, I learned a lot more of this self; I developed my tastes in things such as music, food, and people. I learned how I like things done, and I learned to get along with people I never thought I'd ever get along with. I found that I like getting involved to get problems solved. Also, how hard I work for something is directly proportional to how important my goal was to me. Biology and government classes were not as important to me as chemistry and math, and so I reaped some benefits and paid some consequences. I made some sacrifices, choosing to put off art classes in favor of academics. And yes, I did do many things to appease parents, especially in the beginning. It's hard to say whether or not I (or my parents) made the best choices. Nevertheless, it's important to me to live without any regrets. I like to think of the things I did as worthwhile because they we! re good experiences, and I needed them.

Now, I seem to have met so many challenges. And yet there remains a sense of irony for me when I think of how some younger students and their parents think of me as a paradigm of success. You are interested in what mistakes I made so you can avoid the same mistakes or what worked for me that might also work for you. It is the way I thought of some of my older friends and the way I still think of them, those who are now at Harvard, Stanford, Yale, some of whom will be my neighbors. Is it right that our worth is measured by our success in high school and what colleges we got into? Then again, who could help but be flattered? And who could help but be interested by such prestige? After all, these are the accomplishments that each of us has worked for and achieved in our own way, on our own terms.

So what am I saying? What is the secret to my success? Does everyone have the secret weapons that I mentioned? The secret is that there is no secret, no magic potion, because success does not equal happiness (success != happiness). However, if happiness IS success, then there is hope for you. As Aristotle said "Happiness is something final and self-sufficient and the end of all action." It is what we live for. Then, have I succeeded? I dunno, do I seem happy to you?

The truth is I am still very young. High school was (relatively) easy even though it didn't feel that way while I was there. On the whole, I had few responsibilities; all I had to worry about were grades and sometimes my mood. My food, shelter, basic schedule, clothes, money, etc, were pretty much taken care of. Plus, I only had to care about my own well-being most of the time. Friends and family mostly took care of themselves. I didn't even have a pet. In other words, I ain't seen nothing, yet. That's what college is for.

In high school, I learned about what was important to me and what are sources of pride for me. I am proud of what I am capable of, and I feel it a shame to waste time and energy when I could be at least trying to get a problem solved. Maybe someone else might find it more worthwhile to hone their skills on the guitar or baseball or maybe spend time on having lasting friendships. Anyway, so this is what I find rewarding to spend my time on. Besides, I think it was worth it for me just because I got to write this article, and you will read it because I did well, and you want to know if I am still human. I think I am.

Life Update

Oops, neglected the blog again!

Well, since I last posted, I have finished graduate school, started a job, moved to Oakland, got my leggings in the flesh, started going to Tahitian dance class regularly, and adopted a rigorous regimen of social events.

Housewarming gifts with our Familiars

I plan on getting back into blogging and lifelong learning especially about my field, Sustainable and Responsible Investing, and "data science."

In the meantime, Hobby Sundays and other side projects will continue.  I carved Conan O'Brien at the last one.  MikeyP made a Flickr page.  Here are a few of my own pictures.  He looks more like Jesus when lit.  Oh well!

Leggings Design

i'm working on a leggings design for Bombsheller.  i'm planning for this to be on the thighs

Ethical Mice

My interest in corporate social responsibility and climate change has led me to reflect on the role of ethics in industry.  Reading "Flash Boys" by Michael Lewis, "Moral Mazes" by Robert Jackall, and a collection of books and articles has given me a better idea about decision-making inside corporations and the challenges of regulating businesses.  Many of these challenges seem to be outside the standard microeconomic framework that currently dominates policy analysis.  In that framework, ethics seems quaint, but perhaps there really is no replacement.

There are many reasons to regulate the private sector: minimize pollution, improve worker safety, ensure fair prices, combat fraud, etc.  If everyone's incentives were aligned then there would be no reason for rules to be enforced.  In the standard economic analysis framework, the misalignment of incentives cause "market failures."  This means that harms, known as negative externalities, are not being accounted for in the markets of the offending products.  (They might lead to more spending in the markets such as the market for medicine).  The market failures are caused by things like transactional frictions, principal-agent problems, and asymmetric information.  Solutions to market failures involve regulating the private sector one way or another.  The objective is to align the incentives of producers with the interests of society by increasing the cost of causing externalities through fines or taxes.

In applying this framework, welfare is typically equated with monetary value.  Then businesses and individuals in them respond exclusively to monetary incentives, their decisions driven by exacting cost-benefit analysis.  The cost of regulating then, is proportional to the amount the business stands to gain from the activity.

Is this the whole story?  Does this mean ethics is irrelevant?

First I want to point out that the motivation to avoid regulation is proportional to how much "individuals" have to gain.  This is not always the the same thing as the amount the business has to gain overall because the individual is primarily concerned with his/her own career.  This is generally true for decisions in an organization.  In other words, if an initiative has the potential to cause one manager to gain recognition and a bonus rather than sharing credit with other managers, that initiative is more likely to be championed and thus implemented.  For example, according to Nassim Taleb in "Black Swan," a contributing cause to the subprime mortgage crisis was the misalignment of individuals and the business.  The analysis of risk management divisions in banks were often ignored because individuals in the trading divisions stood to gain fantastically from increasingly risky activities.

Next, let us inspect the costs of regulation more carefully.  At first glance, the cost is simply the size of the fine, subsidy, or tax.  Most analysts also take into consideration the likelihood that the fine or analogous costs will be incurred.  The cost to the regulating body of administering these programs and auditing activities is often left out of economic analyses.  Both the regulators and the businesses participate in auditing and accounting activities, although for different purposes.  The higher the tax, the more resources businesses will allocate towards evading it by either by masking its activities in its own accounting system or lobbying to cut the budget of the regulator.  It is possible to make information arbitrarily difficult and time-consuming to assess, which greatly increases the cost to regulators.  In Flash Boys, the exchanges created complicated order types.  In addition, the documentation to the SEC about these order types seemed purposefully more complicated than they needed to be.

Complicity among individuals in the industry is another driving factor for the cost of regulating behavior.  If all the businesses participate in obfuscating their activities, then they can all maintain the illusion that the level of complexity is necessary.  Idolizing neoclassical economics and the free market at the expense of ethics then is very convenient for those who stand to gain.  Believing in the wisdom of the invisible hand means that the value of one's work is evidenced by the amount one is paid.  Those who feel no need to question the purpose of their activities can be counted on to be complicit.

Even if regulators manage to administrate a program, they still may not have enough resources or information to assess the effectiveness of the program.  Measuring effectiveness often requires some additional information.  For example, the Reg NMS rule sought to make markets more fair by mandating that financial intermediaries must trade public equities at the best price.  However, financial intermediaries found other ways to scalp investors.  Regulators neglected to collect the information needed to assess the prevalence of other kinds of unfair practices.

By now it should be clear that regulating private sector activities is often an elaborate cat and mouse game.  A few fat mice are more strongly motivated and can more easily collaborate than millions of mice.  The smartest cat must be at least as smart as the smartest mice or else the mice can easily confuse the cat.

Many conclude that regulating is indeed hopeless in many situations.  Brad and his team gave up on the SEC, who had no ability to compete with Wall Street for the talent required to regulate.  In order to sell his idea, Brad had to adopt rhetoric about being "long-term greedy."  But in fact he was personally very compelled to take on the system because it is not "right."  It is significant to me that only those who with an ideal about fairness even dared to pursue a market solution.  Only ethics can provide enough drive to an individual to overcome the risk, the likelihood of a lower payoff, and the stress from causing extreme conflict among peers.

The culture around ethics and the purpose of one's job perhaps should be considered as another tool in policy-making.  The structure of incentives in an organization governs the behavior of individuals.  Moral Mazes describes the incentive structure of a hierarchical bureaucracy typical of large public corporations.  There are many similarities with the environment and culture of these corporations with that of Wall Street exchanges and investment banks as described in "Flash Boys."

It may be possible to modify the standard framework of policy analysis to include this kind of ethical motivation as a part of individuals' welfare functions.  It's not clear to me whether that is the most helpful approach.  Instead, the study of polycentric systems an cooperation could potentially be applied to such environments in order to increase the value of transparency and ethical behavior.  There may also be analytic tools from complexity theory and behavioral economics.

My theory now is that for any given industry, a minimum number of individuals with resources and talent who commit to acting ethically is needed to stunt the efforts of those who are amoral.  On the flip side, a minimum number of talented amoral individuals is needed in order to implement an injustice.  Complicity with an amoral system ultimately perpetuate the injustice systemically.  It follows then that conviction matters.  Resolve matters.  Ethics matter.