Last month I was on the wonderful Joe Walker Podcast. You can watch the full video, or read the unabridged transcript. Joe handpicked the following highlights:
What did you learn about Japanese urbanism?
[1:09:00] WALKER: A couple of questions on urbanism and architecture. So you recently took a trip to Japan, right?
CAPLAN: Yeah.
WALKER: Was there anything on that trip that you learned or that surprised you about Japanese urbanism?
CAPLAN: So, one thing you can definitely see is they just barely worry about historic preservation because their cities just got torched during World War II. They just don't have much that's very historic. So, yeah, if you know the horrors of the war, Tokyo's basically burned to the ground.
WALKER: The firebombing.
CAPLAN: So they had a long tradition of building in wood, and then also horrible firebombing and everything else. So they just don't have the same issues with, “We’ve got to preserve the past.” I mean, a lot of people also say there's this cultural thing where, because of Buddhism or Shinto, they just have the idea of reviving things. For historic buildings, they will actually periodically go and take them down and then rebuild them from scratch because it's made out of wood and the wood won't last forever.
There's this very famous shrine in Nara where it used to be – it’s still – the world's largest wooden building, but I think my book said it used to be fifty percent bigger. And they said, “We're just not going to go and build it the same size.” So that was something where it's like, wow, even for a tourist site, you'll go and do something different based upon, like, “We didn't have the money,” or… I don't know what the rationale was. So that's one thing.
You can definitely see the benefits of mixed use there, because life is just really convenient in Japan as a result of having almost no regulation of “Can I put a store in the ground level of the building?” I'm going to admit I'm not an expert in Japanese regulatory law. I do know that it's at least a lot easier for a residential home to operate as a small business in Japan and just to go and hang out a little shingle and say, “We live here, and also you can get some sushi and just knock on our door.”
In terms of density, you can see that all of the heralded wonders of mass transit, which I'll say even in Europe, are really overblown and it's not that good. Ed Glaeser has a nice paper showing how the main reason why people like cars is that cars are faster almost everywhere.
With mass transit, there's always the fixed cost of walking there, waiting and then you get off and then you have the final thing, or maybe there's transfers. With a car, you can just go out your door and drive there. And by getting rid of those fixed costs, you are able to go and save time for almost every kind of journey, unless there's horrible congestion. When people are saying, “The US government is really encouraging cars.” Is it though? If they did peak load pricing for traffic and for parking, then cars would be a lot better. I'd be happy to drive right into New York City if it cost me $40 but I knew that I could just go and pay market price in order to have no congestion and be able to park.
So I’d say the actual package of encouraging cars in the US, once you realise that not having tolls is anti-car… People think tolls are anti-car. No, no, it's not having tolls that is anti-car, because if you had tolls, then you could use the technology.
But anyway, so Japan is a place where you can go and put in the times for driving versus mass transit. And you say, okay, the mass transit is actually absolutely faster in Japan, because it's not just the density, it's also just their incredible efficiency and conscientiousness of the Japanese. Their cultural differences are quite shocking, when you're there and you just see, wow, this would not work in other countries. In other countries, they would just be screwing up a bunch of things. And here in Japan, their trains really do work.
How likely is YIMBYism to become left-coded?
[1:32:46] WALKER: Now that you've raised politics, I'll ask my political questions. So Operation Warp Speed was successfully run by the Trump administration. Trump boasts about “his vaccine”. But then somehow vaccines become left-coded, and so it becomes a Republican thing to not take a vaccine. Right now, housing abundance and YIMBYism seems more or less bipartisan, if you ignore the far left and the far right. How likely is it that YIMBY becomes either left-coded or right-coded? And which of those options is more likely?
CAPLAN: Yeah, good question. So I say right now, the two actual centres of YIMBY: there's largely left wing activists in major blue cities, and then there are just red states that are YIMBY by default where they haven't really turned it into a philosophy – it's just always been that way, and they don't have the same kind of resentment against construction.
WALKER: Like a Texas.
CAPLAN: Yeah, like a Texas. So, basically, the places that actually have low regulation are clearly red states. The places that have an activist movement who want to have less regulation are basically blue cities and generally blue cities and blue states.
In terms of what this means for the future, in the book I just express my dream, my hope, that it could be bipartisan. But, yeah, I think you are right that if something becomes popular, it will tend to go to one side.
I would say that, strangely, the most likely outcome is that because the actual vocal activists tend to be left wing, that is enough to go and give it a left wing coding, because they're the ones that'll be on TV talking about it. Again, of course, if I go and influence a generation, then it could be different. But I'm just one person here. I think that I've got the absolutely most entertaining book on housing regulation that anyone has written. Let's stick my neck out and say that, because I think it's the only graphic novel about it. I think that by itself makes it more fun.
But, yes, having the most articulate spokespeople for a view be left wing gradually over time makes people think of it as a left wing thing. So I think that that is the more likely scenario. Especially because in low regulation red states, there's very little activist move of, “We want to become more like ourselves. We want to go and make sure that not only do we stay low regulation, we want to double down.” It's more like a default policy. So that's why I don't think that it's too likely to become right coded.
But again, it's still in this inchoate phase, so maybe…
The low regulation is in the red states, but the falling regulation is in the blue states. You get more media attention for the change than for the level, which is another reason I think that it will be thought of as one of those weird things they're doing in left wing states. Even though the truth is that most NIMBYs are also left wing. And these places – definitely towns with the very strictest regulation – are generally very left wing towns and places, places like California.
WALKER: Yeah, yeah. So at the moment, Ezra Klein and Derek Thompson are writing a book on supply-side progressivism. And I don't know, but presumably there'll be a chapter on housing, it’ll be one of the main chapters. What would your advice to them be? Tread carefully? Maybe just make it a section rather than a whole chapter?
CAPLAN: No, I mean, honestly, I almost always tell people to max out. I just figure that the people on your side read you to such a greater extent that you should never worry about improving your own side. Always try to make your side as good as it can be, and especially combine it with saying there's something we can learn from the other side. That last add-on does tend to make it hard to really persuade your side. But that's why it's great that someone as high status as Ezra Klein is going to be the voice, because it's like, “Well, do we go and kick him out of the movement or do we listen to him?” It's like, “Alright, which one: kick him out or listen to him?”It is true, especially one of the uglier features of the modern left is this very sanctimonious “you have to agree with every single part or else.”
What percentage of influential econ papers contain basic yet critical errors?
[31:15] WALKER: Okay, so I want to challenge this story of productivity gains in a few ways. But first, just as a brief digression, the error you found in the Hsieh-Moretti paper reminded me a bit of the error that was discovered in the Reinhardt-Rogoff paper: a super basic error in a very influential paper. What percentage of influential economics papers – measured by, I don't know, they've got more than X number of citations – do you think are just built on houses of cards where there's some error that's passed through peer review? Would it be like a meaningful percentage?
CAPLAN: Yeah, I think so. I mean, again, it's one where people will hasten to say it's probably gotten less bad in recent years because the standards for what you have to disclose have gotten higher. But at the same time, there's not that much in it for a person to go and find a mistake.
So what happened with me is I was rereading the Hsieh-Moretti piece very carefully, and then it just seemed like there were basic multiplication errors in some of the notes. And I'm like, “Alright, well, they're really smart guys. They're not gonna have basic multiplication errors.” And I talked to a few friends, and the usual thing friends said is, “Yeah, no, no. You're misunderstanding what's going on.” I'm like, “Alright.” And then I emailed them, and they wrote back and said, “Yeah, you're right. We made basic multiplication errors.” And I was like, “Oh, my God.”
Now what was striking is that these errors were actually against their thesis, because once you went and fixed the multiplication, they wound up concluding that there were even larger gains to deregulating housing than they originally found, or so that's what came out of it. In a way, it's like a good sign, because you figure if there was some kind of either conscious or unconscious bias towards inflating the result, then that would make sense – that's what you figure people would do; they want to get a big results and get extra attention. But then since I found that they were understating it, it's more of just a careless error rather than some systematic problem.
Then there was, as you mentioned, another critique by Brian Greaney – who I think is probably right, and most people who have looked into it say that he's probably right – which is just that they have a very strange model, and you have to be paying close attention to it, and really probably need to at least be in a graduate program in economics to know why what they did was odd. But I think the simplest way of explaining it is that intuitively, you would think, and I usually think, of deregulation as just something where it just breaks a dam and you can now build more housing, and the supply goes up.
But they basically thought of it more along the lines of, there's just going to be a greater sensitivity of construction to price. And it's like, well, those are kind of related but not really the same thing. I mean, the main thing I think about, if you were to go and deregulate San Francisco, it's not so much that suddenly they would start building more if the price got higher, as they would just build a ton because prices are currently super high.
But, yeah, if you were to do the full audit, that is a... It's a great idea. It's sort of like, it's a great idea for somebody other than me to do.
WALKER: Should someone offer a prize to incentivise it?
CAPLAN: Yeah. So if there's some philanthropist watching this and just wants to go and do a prize… And obviously, I think this would work totally, really well for medical research, too. There's probably just a lot of really basic errors.
It's one where you can sort of go and offer different prizes for different levels, like basic arithmetic errors that lead to more than a 10% change in the prediction or in the claim of the paper. That's the one to start with.
I mean, here's probably a lot of what was going on. This paper by Hsieh and Moretti was in the American Economic Journal. It's a top journal. Normally referees for those journals – I have talked to them, I've even seen them doing their job – they put a lot of work in. But they put a lot of work into the really intellectually demanding stuff. Like, they're like, let me take a really good look. Let's check every formula. Let's go and look at the statistical work and see whether they actually did exactly what they said.
But the idea that they would need to go and check for basic arithmetic, that's not something that they're really used to. “Well, of course, the basic arithmetic is right.” And is it? How do you know that the basic arithmetic is right? So, in a way, it's one of the easiest things to check, and something where you don't need a lot of knowledge of the technical material in order to go and check that stuff. So that would seem like a pretty good thing to do.
Something else that's been found is that when papers do get corrected, it doesn't seem to affect their citations or anything else. It's just like, people generally don't hear about it. You just keep citing the original piece.
Doesn't this show that academia is corrupt? It's like, yeah, fairly corrupt. It's not as bad as possible. It's not all a pack of lies. But it does mean that quality control is just a lot lower than it seems. A good way of thinking about it is that there's probably, at least in fields like econ, there's really high quality control in some of the areas, but that does not mean that overall quality control is good.
This would be like at the Coca Cola plant. Like, okay, we have fantastic checking for whether every can has as much liquid as it's supposed to have. We have fantastic checking for whether there's any stray glass around. And then once a year we look for rodents. And if there are rodents, then it's like, okay, well, I guess somebody should get on that eventually. And it's like, “Well, look, be fair. We're really careful about some issues in the Coca Cola factory.”
It's like, “Alright, yes, you are. But that doesn't mean that the final product has great quality control, because that would require a high level of control for everything.” And in fact, you might say perhaps you're putting too much effort into making sure that every can has the right amount of liquid down to the 10,000th of an ounce, and you should move some of those resources into checking for the rats.
Does Earth's future look like Coruscant?
[1:43:31] WALKER: That is classic. That's also a very Indian story as well. So, final question. Taking the long view, what is your modal case for the future of cities? Do you see human history moving inevitably towards a planet where we just densify all of the available landmass? Kind of like a Coruscant in Star Wars?
CAPLAN: Yeah, interesting question. Very long run? Very long run, probably, yes, because despite low fertility rates, life finds a way. Jurassic park was correct. And we cannot have low fertility forever. We know that there is strong genetically-based variation in completed fertility. Some of it's just some people are more fertile, others it's just some people have a stronger preference for having kids. In combination this means that right now we are seeing a great die off of the genes of people that do not like children. And while in the short run this is very likely to go and lead to absolute population fall, eventually if you have a world where everybody who doesn't like kids has zero kids, and the only people having kids are people who like kids, there will be a transformation of human psychology.
And again, probably over the course of a few centuries, which in evolutionary time is not very much, we're just going to get rid of all or almost all of the anti-natal attitudes in the population, In the same way that right now almost everybody likes sugar, in a few hundred years almost everyone will like kids. And the complaints that make sense to people now, like “just a bunch of crying, changing diapers” – I love hearing that. There's variation, and as long as there's variation and there's sexual selection, put that together and there's going to be a change in the population, and the way that we think about things and feel about things, the emotions are going to change.
So my view is that it's often hard to see evolution at work over the course of one generation. Over the course of the ten generations, it's just unmistakable.
So in the future, we are going to have to be very pro-natal. And once people are very pro-natal, then there's no reason for us to do anything other than just have very high population growth for a long time. And once we can do that, well, where are we going to put all the people? Yeah, in the very long run – so maybe in a thousand years – then the coruscant prediction is quite reasonable, all the way down to settling Antarctica and things like that.
Based on my understanding of cost, I think that the bottom of the ocean is better than the Moon. So the bottom of the ocean has got problems, but the Moon is way worse on so many levels. I think that that bottleneck of getting to another planet that is comfortably inhabitable at a reasonable cost, that's a really big bottleneck, actually. I wouldn't be shocked if that took tens of thousands of years, actually.
And that we do finally at least get close to a maximum human population using all available technology. We're using, like, a crazy amount from modern standards of the existing Earth. Things that are also probably a lot more doable than the moon are things like going and draining large oceans to get more land, that kind of thing.
So I think that is our long run future of looking like Coruscant, maybe even more – maybe even denser than Coruscant – and then having these amazing technologies of the future that will sustain us again.
That bottleneck of getting to other habitable planets seems so big to me. We have these unfortunate facts of, like, you can't go faster than the speed of light, and the amount of energy to get anywhere near the speed of light is also crazy large. You’ve got to accelerate for half the way and decelerate for the other half, and then you show up there, and something could be wrong with the planet. It's like, well, from light years away, it seemed like it would be ideal for human habitation, but unfortunately, there's one previously unknown poison in this planet, and it ruins the entire planet. Oh, now what? Yeah, self-destruct? We were counting on getting in from this planet here, but it turns out we will melt if we land. Oh, no.
WALKER: It makes housing deregulation seem easy.
CAPLAN: It does. So you probably know about the Fermi paradox. If there's alien life elsewhere in the universe, where is it? My preferred choke point is: it's so crazy expensive to get to another habitable planet. So I think there's probably tons of intelligent life right here in our galaxy, but numbers that are successfully going and colonising other worlds at a rate that is visible, I think that's probably super low. The number of alien civilizations that have two planets in this galaxy, maybe that's zero. The other ones, there's got to be a bunch of alien civilizations. But multiplanetary alien civilizations – that's my preferred bottleneck. I'm almost the only person who believes this, because I talk to a bunch of people, and they go, “That's crazy, Bryan.” And it's like, is it really, though? It seems really hard, doesn't it? And the cost. It's not just whether it's physically doable, but whether it is cost-effective to do it, right?
WALKER: Right. Well, at least we can still have trillions of people here on Earth.
CAPLAN: Yeah, there's plenty of room.
One, Coruscant is _very_ dense, _very_ high-elevation and isn't seventy-percent ocean. You're not getting Coruscant on Earth any time soon (not to mention the food problems, presuming those are resolvable with enough energy).
Two, regarding the pro-/anti-natalism, the question is to what level it's genetic evolution and to what level it's memetic. If the meme of "have no kids" (or its weaker versions) can easily get hold even of people who are predisposed to like kids (I honestly think I might be the case of that: I do have a strange, irrational predisposition to kids, but rationally I can't bring myself to make any steps towards that because, well, unstable financial situation, problems with the female partner (I am male), and so on), then, well, it will.
We’ll build space habitats in order to exploit off-planet resources. Those had _better_ not be as nasty as portrayed on _The Expanse_. It will probably pay to colonize Mars to support those habitats.
This will give us the tech base to build interstellar ships. If the target system’s planet is a bust they will build more space habitats. Think C. J. Cherryh’s _Alliance/Union_ stories. I do think that systems will have many smaller habitats rather than one large station.