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Information manipulation a good idea? I think not

Fuhai Hong and Xiaojian Zhao have an article forthcoming in the American Journal of Agricultural Economics entitled Information Manipulation and Climate Agreements.  They write:

It appears that news media and some pro-environmental organizations have the tendency to accentuate or even exaggerate the damage caused by climate change. This article provides a rationale for this tendency by using a modified International Environmental Agreement (IEA) model with asymmetric information. We find that the information manipulation has an instrumental value, as it ex post induces more countries to participate in an IEA, which will eventually enhance global welfare. From the ex ante perspective, however, the impact that manipulating information has on the level of participation in an IEA and on welfare is ambiguous.

The authors seem to to want to rationalize information manipulation, even making it a part of the acceptable "tool box" of policy levers.  They conclude:

In addition to other approaches for dealing with the free-riding problem, including taxation, quota systems, privatization, etc., this article introduces a novel mechanism, “information manipulation.”

The authors construct a mathematical model to suggest that exaggerating consequences can have positive impacts by getting people to "do the right thing".  But, this can only be true in the narrowest of senses.  How does one know that exaggeration will cause the "right" amount of public response, rather than causing a diversion of resources away from other productive uses?  More importantly, what happens when people find out they were misled?  How will the public respond to the next information/manipulation campaign? Degrading the public trust is surely not a long run beneficial strategy.  

And, what can we say about a group of citizen that now have biased beliefs relative to the true state of the world?  Jo Swinnen and colleagues have written on this issue arguing that activist organizations often try to slant information to acquire more donations, and in the process can lead people to have biased beliefs (even if people started out believing the truth).  In one paper in the European Review of Agricultural Economics, they write:

we review the analysis and communication of organisations active in the food policy arena and review a series of hypotheses to explain their apparent change of views as reflected in their public statements. In particular, we analyse how communications to potential donors in fund-raising affects the overall communication strategy of the organisation. We explain how policy organisations’ (POs) competition for donors’ funding may lead to ‘bias’ in their policy communications. Bias in policy communication may draw in larger revenues through fund-raising, but it may have negative welfare effects if it induces suboptimal behaviour by various other agents who use this advice for their decision-making.

For scientists to have any long-run credibility, we need to tell the truth as best we know it: uncertainties and all.

Does Whole Foods Sell Pseudoscience?

A colleague sent me a link to this interesting article in the The Daily Beast by Michael Schulson who argues that Whole Foods is the Temple of Pseudoscience.  He notes:

My own local Whole Foods is just a block away from the campus of Duke University. Like almost everything else near downtown Durham, N.C., it’s visited by a predominantly liberal clientele that skews academic, with more science PhDs per capita than a Mensa convention.

Still, there’s a lot in your average Whole Foods that’s resolutely pseudoscientific. The homeopathy section has plenty of Latin words and mathematical terms, but many of its remedies are so diluted that, statistically speaking, they may not contain a single molecule of the substance they purport to deliver. The book section—yep, Whole Foods sells books—boasts many M.D.’s among its authors, along with titles like The Coconut Oil Miracle and Herbal Medicine, Healing, and Cancer, which was written by a theologian and based on what the author calls the Eclectic Triphasic Medical System.

You can buy chocolate with “a meld of rich goji berries and ashwagandha root to strengthen your immune system,” and bottles of ChlorOxygen chlorophyll concentrate, which “builds better blood.” There’s cereal with the kind of ingredients that are “made in a kitchen—not in a lab,” and tea designed to heal the human heart.

Schulson goes on to ask:

So, why do many of us perceive Whole Foods and the Creation Museum so differently?

His answers related to differences in perceived harm to society and whether the perpetrator is a business or not.  I didn't find the answers all that compelling but not sure I have anything better to offer.  In fact, I think some of it is almost exactly the opposite of what Schulson posits.  Whole foods sells products that don't seem like they're sold from a business - at least the big bad businesses.  They sell the idea that their company (and those stocking products on their shelf) put your health above corporate interests.  A quick look at the receipt after checkout might disabuse one of that notion.  I also think people tend to think about food differently than other issues and there is a hypersensitivity (at least in our relatively rich developed world) to perceived risk that is often conveyed as a sort of morality.  

 As Jonathan Haidt put it in the The Righteous Mind:

And, why do so many Westerners, even secular ones, continue to see choices about food and sex as being heavily loaded with moral significance? Liberals sometimes say that religious conservatives are sexual prudes for whom anything other than missionary-position intercourse within marriage is a sin.  But conservatives can just as well make fun of liberal struggles to choose a balanced breakfast - balanced among moral concerns about free-range eggs, fair-trade coffee, naturalness, and a variety of toxins, some of which (such as genetically modified corn and soybeans) pose a greater threat spiritually than biologically.

Is portion size to blame for obesity?

I've often seen presentations where the authors show the size of an average hamburger or soda in the 1960s, 70s, 80s, and 90s as a way of making the point that portion sizes have increased, and thus contributes to the rise in obesity.  Changes in portion size probably have played some role, but at least according to this experiment published in the journal Obesity, it may play less of a role than first meets the eye. The researchers recruited over 233 people working in a large medical complex and randomly assigned them to treatments that differed according to the size of the free lunch they were given (one control group was given no free lunch at all).  Here's what they found:

Adults (n = 233) were randomly assigned to one of three lunch size groups (400 kcal, 800 kcal, and 1,600 kcal) or to a no-free lunch control group for 6 months. . . .

Body weight change at 6 months did not significantly differ at the 5% level by experimental group (1,600 kcal group: +1.1 kg (SD = 0.44); 800 kcal group: −0.1 kg (SD = 0.42); 400 kcal group: −0.1 kg (SD = 0.43); control group: 1.1 (SD = 0.42); P = 0.07). Weight gain over time was significant in the 1,600 kcal box lunch group (P < 0.05).

A remarkable increase in portion size from 400 kcal to 1600 kcal for lunch over a 6 month time period resulted in no statistically significant differences in weight across groups at the end of the period.  If you compare the pre- and post-weight of the people in the 1600 kcal group, there was a slight increase (0.19kcal/month) in weight for people in that group but not for people in the 400 kcal group or the 800 kcal group.  Curiously, those in the control treatment, which included people who were not given a free lunch, gained a statistically significant 0.24 kcal/month - more than those in the 1600kcal free lunch group! 

The trouble with many "interventions" such as this (similar to those that happen at school lunches) is that people can substitute across time.  If I eat a big lunch, I'm likely to eat less for dinner. And vice versa.  If I eat a 400 kcal lunch, I'm more likely to grab a snack in the afternoon than if I eat a 1,600 kcal lunch.  

Apply this thinking to related policy ideas.  Ban sodas or transfats. What will people drink and eat instead?  Tax restaurants.  What will people eat at home?  Add more veggies to the plate at school.  What will happen to veggie consumption at home?  I'm not saying that such policies might not have some effect on weight, only that because of substitutes and compensating behavior, they will often have less effect than is expected.

Interview on Economics of GMOs

I was recently interviewed by the website The Daily Meal on GMOs.  Here is what I had to say:

“The world is facing many challenges,” says Lusk. “(They include) a growing world population, climate change, and droughts in many areas of the U.S., just to name a few.  Biotechnology and genetic engineering do not hold all the answers, but all tools should be on the table to sustainably address these societal challenges."

On a domestic level, proponents of GM products see the opportunity to develop strain-resistant crops that cost less to manufacture. These lower food costs would benefit the farmers, and in turn would reduce the cost of foods for the retail consumer.

"In the U.S., about 90% of all corn and soybean acres are planted with GE varieties,” says Lusk. “These were decisions made by real-life, flesh and blood farmers. No one was (or is) holding a gun to their head. The fact that farmers willingly adopted GE varieties at such a fast clip (even while paying a premium price for them) reveals their belief that it is in their best interest to do so.  The scientific evidence shows that adopters of GE corn, soy, and cotton have enjoyed slightly higher levels of profitability.”

The support from that last claim, incidentally, comes from numerous peer-reviewed studies.  For a summary of the early research on the topic, see this USDA report, which shows that profitability tends to be either similar or higher among GMO adopters.  Even in cases where measured profitability is similar for GMO adopters, these simple measures often do not take into consideration the value of risk reduction or value of time saved by the farm operator.  We ultimately have to look at the decisions farmers made, and it seems quite clear corn and soybean farmers believe themselves better off adoption GE varieties.

The article goes on to interview Jeffrey Smith, a long time anti-biotechnology crusader.  The article seems to give the impression that we couldn't profitably produce corn or soy without government subsidies.  I am aware of no good research that would support that assertion.  

Then, Smith is quoted as saying the following:

“Independent research confirms that average farmer profit does not increase with GMOs,” Smith writes.  “And numerous examples of closed markets and suppressed prices have followed the introduction of genetically modified crops worldwide. In Hawaii; for example, GM papaya was blocked by Japan. Prices dropped from $1.29 per kilo to about $.80, and in spite of increased papaya consumption in United States, papaya production in Hawaii dropped by 40 percent.”

I wonder which "independent research" he is referring to?  As I indicated above, you can find some studies indicating no profit gains from biotech adoption.  But, what does the cumulative evidence in the peer reviewed journals suggest?  Not what Smith claims.  And, why are 90% of corn/soy farmers so dumb as to adopt a more expensive technology that isn't making them better off?

Also, to suggest that adoption of GM papaya in Hawaii hurt that industry because the Japanese blocked imports is just silly.  Hawaiian producers adopted a genetically engineered papaya that is resistant to a virus that was devastating that industry.  Yes, Hawaiian papaya growers would have been more profitable had Japan not reacted the way they purportedly did.  But, how profitable to you think Hawaiian growers would be if they had no papayas to sell at all?