Micro-Institutions Everywhere: Shipping Containers

Bridge in Wuppertal, Germany

Bridge in Wuppertal, Germany

Dollar bills have several features that make them ideal for modern commerce. They are impartial, lightweight, and memoryless. You can use them to buy a gun or a granola bar, to pay a drug dealer or a dry cleaner. As a vehicle for trade, it does not get much better.

Suppose the dollar bill had a brother, a younger but larger relative whose own contributions similarly smoothed the pathways of globalization. That brother would be the shipping container:

Think of the shipping container as the Internet of things. Just as your email is disassembled into discrete bundles of data the minute you hit send, then re-assembled in your recipient’s inbox later, the uniform, ubiquitous boxes are designed to be interchangeable, their contents irrelevant.

Once they enter the stream of global shipping, the boxes are shifted and routed by sophisticated computer systems that determine their arrangement on board and plot the most efficient route to get them from point to point. The exact placement of each box is a critical part of the equation: Ships make many stops, and a box scheduled to be unloaded late in the journey can’t be placed above one slated for offloading early. Imagine a block of 14,000 interlocked Lego bricks—now imagine trying to pull one out from the middle.

That’s Andrew Curry in the latest edition of Nautilus, and the whole article is worth a read.

Podcasts I Like

Apologies for the silence here lately. I have been working on a couple of longer-than-average posts, as well as some fun projects that I will hopefully be able to share with you here soon. Part of the influence in those upcoming posts is from podcasts I have enjoyed. (Readers of the tipping post may have noticed that two of the main references there were to podcasts as well.)

Ben Franklin Koss HeadphonesThus, I thought readers of this blog might enjoy some of my favorites. There are likely some that I have omitted because I listened to all of their episodes some time ago. Below are those that have stood the test of time or that I am listening to currently.

Economics/Social Science

  • Analysis: Half-hour episodes on current events with a social scientific perspective.
  • Data Stories: As you might expect, an audio podcast about data visualization has some weak points. However, this is useful as a who’s-who of the visualization community.
  • Econtalk: My absolute favorite podcast. Each week, Russ Roberts and a guest discuss research or current events using economics as a lens on the world. Sometimes I think Russ is too hard on statistical methods, but every episode is worth a listen.
  • Great Economists: Originally a MOOC from MRUniversity, the audio from this course is now available as a condensed series of podcasts.
  • History of Rome: History’s greatest empire in 170-odd episodes. Although new episodes are no longer being produced, host Mike Duncan has a new project in the pipeline that is expected in September.
  • Loopcast: DC WarKids and their guests discuss national security and international relations.
  • More or Less: Tim Harford takes quantitative headlines and questions them, often finding more than meets the eye.
  • Planet Money: My second-favorite podcast, after Econtalk. The hosts explain current events or applied economics lessons in accessible language with fun examples. A podcast like this focused on politics would immediately become my all-time favorite.
  • Pop-Up Ideas: Another Tim Harford podcast, this one covers big ideas in social science in a short and punchy manner.

Technology

  • Accidental Tech Podcast: Marco Arment, Casey Liss, and John Siracusa discuss Apple and web technology. This podcast originated as outtakes of their casual car show, Neutral. A very enjoyable listen every week.
  • Bitsplitting: Daniel Jalkut  interviews technology professionals, many of them entrepreneurs.
  • CMD+Space: Myke Hurley interviews guests who “do great things.”
  • Giant Robots Smashing into Other Giant Robots: Discussions of software design and development, hosted by Thoughtbot’s Ben Orenstein.
  • Ruby Rogues: Although originally a Ruby-focused program, after over 100 episodes the rogues now delve into other issues including education, cognition, and the politics of software communities.

The Problem with Tipping

Association between tipping and corruption at the country level, by Magnus Torfason. I have no idea what's going on to the left of zero.

Association between tipping and corruption at the country level, by Magnus Torfason. I have no idea what’s going on to the left of zero.

The topic of tipping has been on my mind since a dinner in San Francisco this April, when Allan Dafoe brought up the difference between Sweden and the US. In Europe, the pattern seems to be that workers are paid more and tips are not expected. Sometimes (eg in Germany) a waiter would likely be told to keep the change from a cash payment, but the reason given for this is that making change is demeaning. In the US, most waitstaff are paid a paltry $2.13/hour and make the rest up in tips. Why has the micro-institution of tipping endured in the US, and what are advantages and weaknesses of it?

One advantage of tipping is that it helps solve the principal-agent problem between the restaurateur and the staff. It is difficult for the restaurant manager to monitor the quality of servers, but much easier for the customers to do so. Thus, having customers set the compensation level for servers encourages them to be responsive. This in turn keeps customers coming back to the restaurant, which is the manager’s goal. However, tip-pooling can undermine this effect, as can the opportunity for servers to offer lower quality service to a higher volume of tables.

A major disadvantage to tipping is that it seems only weakly correlated with service quality. In an informal, small-n poll of fellow grad students on the same San Francisco trip, most of us tip a relatively fixed percentage of the bill (20-25 percent) regardless of service. This tends to be associated with work experience in the service industry, which can also lead to higher tipping percentages. Furthermore, small “nudges” such as paying on an iPad that offers tips in round dollar amounts rather than percentages can have a strong effect on the tips received by staff.

Another problem with tipping is uncertainty about when it is or is not appropriate. In a country where it is never appropriate, there is no uncertainty. When tipping exists in some settings but not others, there can be a great deal of uncertainty about when to use it. Restaurants and taxis seem like obvious tipping situations. But what about when you order food for carry-out? (I vote yes, but a smaller percentage.) And why not tip the attendants on a flight, who provide beverage and sometimes food service?

These and other problems with tipping are well-known, yet the micro-institution seems fairly ingrained in American society. If there were one profession where I would add tipping it would be my pharmacist–they often provide fast and friendly service for something I could not do myself. On the whole, though, we would be better off without this confusing and inefficient practice.

See also:

Why Do We Tip? (Planet Money podcast)
Should Tipping Be Banned? (Freakonomics podcast)
Research by Michael Lynn (over 50 papers)

Will the Internet Lead to Convergence of Dictatorship and Democracy?

Stephen Walt thinks this is a distinct possibility:

[P]erhaps the most likely possibility is that we will see a partial convergence between authoritarian systems like the People’s Republic of China and open democracies like Britain and the United States. Instead of empowering individuals and forcing monarchies and dictatorships to liberalize, the connectivity revolution could cause democracies and dictatorships to move somewhat closer together. Dictatorships will be less able to prevent new ideas from circulating and may even be vulnerable to collective action facilitated by social media (see under: Arab Spring). So they will become somewhat more open. But at the same time, previously open societies that privileged privacy and strictly limited government monitoring will be unable to resist the temptation to collect lots of private data, whether from surveillance cameras or from your laptop. Authoritarian states may get somewhat weaker, while liberal governments become somewhat more intrusive and authoritarian.

My own view has been somewhat more optimistic (see the summary here) but recent events seem to support the latter half of Walt’s argument.