Will our government please take note?

Bill Gates is no stranger to Italy; in fact, he seems to be rather fond of coming here to sign strategic partnerships between Microsoft and public-sector partners, from Poste Italiane to the City of Milan, agreements that have yet to produce any visibly useful effects for us citizens and customers. Today, I would like to offer a useful Gates quote from a Q& A session before a recent Inter-American Development Bank conference in Miami, as reported by Reuters (see full speech and and Q&A here):

Chairman Bill Gates credited the Internet on Friday with making “phenomenal” inroads in beefing up government transparency, saying cabinet ministers in Scandinavia now keep little, if anything, private.

“The Nordic countries, with Sweden and Denmark, have really taken it to an amazing level,” Gates told a conference on Latin American government, ahead of an annual Inter-American Development Bank meeting in Miami.

“Whenever a (Nordic cabinet) minister goes out to lunch, you can see how much he spent for lunch and how much on the cab. It literally goes up (on the Internet) within a few hours,” he said.

He was referring to detailed postings tracking daily business on government Web sites, which include everything from cabinet ministers’ calendars to budgets and real-time accounts of the bidding for lucrative government contracts.

“Every bid that’s ever done, the bidders come up on the networks, you see the terms they offer,” said Gates, still referring to the new, Web-savvy operating procedures in places like Sweden.

“It’s a very open, transparent bidding process,” he said, adding that the “things about government that really count” were now accessible to anyone with a personal computer.

Mr. Stanca, likely future Minister for Innovation and Technology; Mr. Alfano, likely future Minister for Public Affairs: even if Mr. Berlusconi has candidly confessed that he knows nearly nothing about the Internet, will you please take note of Mr. Gates’s wise words?

The Dismal Science and women in the workplace

There are good reasons why economics is called “the dismal science“, one reflects upon reading The Logic of Life by Tim Harford (The Undercover Economist). It shows us why revolutions are rare, why special interests systematically prevail in politics, and why, rationally speaking, it’s hard to justify expending the energy to go out and cast your vote in an election (“Steve Landsburg goes so far as to suggest that if you want to change politics, you would be better advised to buy a lottery ticket with the intention of spending the proceeds on lobbying.”)

A chapter examines a number of experiments showing how racism emerges in the workplace, even with a level playing field (call two equally endowed groups of people, say, “green” and “purple”) where decisions are subject to tiny random variations, and how in real life company recruiters actually do categorize resumes into three buckets: “white and good”, “white and mediocre”, and “black”. The key here is to distinguish “taste-based discrimination” (which is irrational and self-defeating) from “statistical discrimination”, which Harford chooses to call “rational racism” in order to drive the point that it won’t go away if we don’t do something about it (“doing something”, in econo-speak, typically being about changing the incentive structure for decision-makers).

Yet, Harford misses the opportunity to apply his own findings to women in the workplace. Let’s try.

First of all, through the whole “division of labor and comparative advantage” spiel, he makes it clear that we don’t necessarily need to become much better performers in the office; we’d be better advised to start by becoming a lot less competent at domestic work, something I have already argued for. However, once we’ve rebalanced the housework, we’re still stuck with an inescapable reality. Say that eighty per cent of women, over the course of their working life, take some time out to bear one or more children. The actual bearing of the children is hardly outsourceable (surrogacy is forbidden in many jurisdictions, and adoption has its own costs and requirements on the parent’s time). So, first of all, we’d be well advised to keep maternity leave at a minimum, and to introduce a mandatory matching paternity leave for fathers. But how many men will vote for that? It’s against their interests, since caring for an infant child is notoriously much harder than hanging around the office water cooler.

The reality is that the individual woman will have less opportunities in the workplace regardless of whether she actually bears children or not. That’s exactly what Harford calls “rational discrimination”: and it doesn’t even take a majority of infant-bearing women to make this happen. It would probably happen, say, even if five per cent of women produced all the infants in the world, and ninety-five per cent remained childless. Because, you see, ex ante the employer has no way to tell whether a given woman is going to bear children.

Women fight hard against this structural disadvantage (for example, by getting more years of education). Yet, for the individual career-minded woman, game theory shows that the only way to become as attractive to an employer as her male counterpart would be to signal that she is not going to bear children, and to do so in a credible manner. As Nobel Prize winner Thomas Schelling says, “the ability to make a binding promise is very useful”. Unfortunately, about the only way to make this type of promise binding and therefore credible is to get irreversibly sterilized, and to show the surgeon’s certificate to prospective employers.

Unless you view this as a desirable social outcome, you have to agree on at least one of two solutions. It’s either compulsory paternity leave for new fathers, for at least as long as the mother’s maternity leave (or probably even longer, to compensate for the share of children born in fatherless households); or another way to change the incentive structure, such as quotas for women in congressional and governmental postions, company boards (the Norwegians are doing this), and most other jobs with perks.

I have come to be, personally, in favor of both.

Ten paths to Internet apocalypse, and its consequences

I am often attracted to dystopias about the last days of civilization. Yet there is a story waiting to be written, I believe, about what would happen if a chunk of civilization as we know it, the Internet, went down forever. Hard to imagine? Read about ten ways the Internet as we know it might die in this GigaOM post by Alistair Croll.

Of course, nothing much would change in the short term for the four or five billion people who don’t use the Internet today and have no prospects of doing so in the near future, despite the well-intentioned dreams of tech philanthropists. But a collapse and permanent unavailability of the Internet, after leaving the digerati temporarily inconvenienced by the end of the twitters that bathe their lives in the warm glow of a persistent friend-generated soundtrack, would drive people to dig out old fax machines from their junk closets, pay a lot more visits to their local post office, and stock up on stuff they couldn’t order online anymore. It might temporarily revive some old economy stocks, such as those of newspaper publishers (even if the immediacy and quality of newspaper content would be severely degraded) and telecom companies. (It is debatable, however, whether the volume of stock trading would keep up, given how information flows in global financial markets have come to rely on the Internet). It would spell the end of low-cost access to airline reservation systems. Over time, it would have much more far-reaching economic effects. It would destroy a huge variety of knowledge jobs and revive less skilled jobs. And of course, in the end, it would depress the chances for trading, innovation and growth for the other four or five billons of Earth dwellers, too.

The Internet was conceived with a lot of built-in redundancy, and is therefore very resilient. The death of the Internet would be a black swan – a hard-to-predict event with catastrophic consequences. Still, we have to take good care of the Internet. Because civilization without it, I reckon, would be a lot less fun.

The psychedelic roots of Portishead

Any band that takes ten years to come out with its third album has either dramatically run out of ideas, or has taken its time for very good reasons. After seeing Portishead perform at the Alcatraz in Milan on Sunday night, I am very glad to report that it’s the latter.

I’ve always thought that their music had a peculiar cinematic quality: it would make a haunting soundtrack to a 1950s noir, or a sci-fi flick, or (as my friend Max suggested) one of the better James Bond movies. As they unfurled their rich tapestry of sound the other night, it became clear that they are much more than a trip-hop band from Bristol. They’ve done their homework, so to speak. The same way Bill Viola is no mere video artist, but has become a scholar steeped in his Pontormo, his Wagner and his Zen Buddhism, Portishead have delved into the encyclopedias of our musical heritage, dug out a few distinctive and unrelated sounds that interested them, and remixed them to come up with something that belongs uniquely to Portishead, yet pays homage to those ur-sounds in our collective memory.

Their Milan performance was powerfully “in the flow”, as that of an athlete winning a race, and opened up glimpses into their psychedelic roots. Max said they sounded like the Pink Floyd in the Pompeii period. Pink Floyd, of course, didn’t have a contralto lead singer, and only occasionally collaborated with female vocalists (one would like, though, to hear Beth Gibbons’s cover version of The Great Gig in the Sky, now that I think about it). Texture, complexity and distortion are some of the attributes that link their music to the glorious era of progressive rock.

Their new album, called Third, comes out this month. To read more about its birth (and the band’s instrumentation, including the “lovely old harmonium” elegantly squatting in their studio, bought on eBay for £29), check out this article by Ben Thompson.