Wednesday, February 04, 2015

The few are enough...

As most of you know, I do not and have not participated in phone surveys of any sort for a decade or more. I have always suspected that I was not alone - and I'm not. But counter-intuitively, declining participation rates do not appear to be affecting results as much as I thought.
This is not to say that declining response rates are without consequence. One significant area of potential non-response bias identified in the study is that survey participants tend to be significantly more engaged in civic activity than those who do not participate, confirming what previous research has shown.2 People who volunteer are more likely to agree to take part in surveys than those who do not do these things. This has serious implications for a survey’s ability to accurately gauge behaviors related to volunteerism and civic activity. For example, telephone surveys may overestimate such behaviors as church attendance, contacting elected officials, or attending campaign events.However, the study finds that the tendency to volunteer is not strongly related to political preferences, including partisanship, ideology and views on a variety of issues. Republicans and conservatives are somewhat more likely than Democrats and liberals to say they volunteer, but this difference is not large enough to cause them to be substantially over-represented in telephone surveys. [More]

This unexpected (for me) result does confirm my belief that farmers - well, a lot more in all professions - need to make statistics and probability courses a higher priority when in college. Of course, that daisy-chains back to taking calculus, I would guess, which has been a big hurdle for freshmen of all flavors.

But just notice how many of the debates within and without agriculture are based on public surveys or estimates of probable outcomes. Unless we have better tools to comprehend and utilize such information, we will be limited for the most part to trial-and-error. That doesn't strike me as competitive in a word where quants deploy algorithms to outfox our instincts in the marketplace. 

Monday, February 02, 2015

The drift away from stuff...

Even as wages remain sorta stagnant, Americans are enjoying a windfall from lower gasoline prices. But early evidence suggests it won't be going to buy more Things necessarily.
The couple, both 56 and from Emmaus, Pennsylvania, drive a lot so filling the tank didn’t leave much room for fun. Now they’re splurging after years of staycations, minor-league baseball games and free concerts. In October, they visited Disney World, their priciest vacation in ages. They’re also planning to renovate, meaning more trips to Home Depot Inc. “We’re finally starting to feel like we’re back in the middle class,” Cheryl Saul said.
Millions of Americans are benefiting from the collapse in gas prices, which Goldman Sachs Group Inc. equates to a tax cut worth as much as $125 billion. That’s potentially good news for a range of mass-market companies that have struggled while upscale establishments catering to wealthy Americans prospered. Family Dollar Stores Inc., Popeyes Louisiana Kitchen Inc. and McDonald’s Corp. all say they’re benefiting from lower gas prices or will in the second half.  [More]

Adding in my own anecdotal datum - Aaron reports Disney World is very busy right now - I wonder if the Great Recession has altered perhaps permanently the spending priorities, along with an aging population.
Yet for the vast majority, the shock of the Great Recession lingers — and that’s a good thing in terms of how most folks are managing their money. In a new survey from Fidelity, nearly half of respondents say even now they are saving more, reducing debt and building an emergency fund. 
A new survey from Principal Financial finds that the number of workers preparing for retirement is on the rise and that most workers who expect a tax refund plan to save or invest it, or pay down debt. Before the crisis, people commonly cited going on vacation and buying big ticket items as well.
Perhaps most telling, the Fidelity survey found that 78% of those who have taken steps to shore up their finances say the measures are part of a new and permanent personal financial strategy. “The sheer number of people who say the changes are permanent was probably most surprising,” says Ken Hevert, vice president of retirement products at Fidelity.People are moving from scared to prepared, Hevert says. When the financial crisis hit, 64% said they were scared and 45% said they were prepared; today, 45% say they are scared and 61% say they are prepared — a near perfect reversal. In general, those who feel prepared are the ones who have cut debt, increased savings and built an emergency fund. [More]
This feels about right, FWIW. And I think the breach of faith in the future felt by Boomers will be lasting, simply because of the characteristics of aging and attitude. We won't have enough time to get over this, so to speak.

Meanwhile, oncoming generations have never been as focused on accumulation of and economic signaling by "things". There seems to be a shift toward experiences like the vacations mentioned above over snazzier cars, for example.

We will have a hard time predicting future consumption from historical data, I think. This implies we will likely be disappointed by GDP growth (~70% consumer spending), retail sales, housing, and wages for some time. 

I am sure much of my thinking is influenced by availability bias - it's hard to imagine things being different from current conditions - but as secular stagnation becomes less a buzzword and more a reality, it is the best outlook guidance I can user to plan for the future.

In short, it may not get any better than this.

Sunday, February 01, 2015

Not much progress...

I keep looking for some indication that the public is coming 'round on GMO's. If they are, I haven't seen the evidence. In fact, it looks to the contrary:


Note that GM food has the largest public-science divergence. Bigger than climate change.

I have two reactions. First, this issue may be simply carried along in the tides of science disdain indicated by other specific controversies above. Climate, vaccinations, GMOS's, etc. are all part of a larger holistic problem for many perhaps.

But it could also be that GMO's are the heavy lifter for the anti-science crusaders. Like nuclear power, which never really cleared escape velocity, rejection of the evidence of GMO safety seems to be an enduring, possibly even strengthening popular sentiment.

All this can be more than a little discouraging. We've been "telling our story" like crazy. And without any positive results, and possible the opposite.

Second, we don't seem to have any viable tools to change these attitudes. In fact, it appears altering public attitudes its getting harder, much harder.
Last month, Brendan Nyhan, a professor of political science at Dartmouth, published the results of a study that he and a team of pediatricians and political scientists had been working on for three years. They had followed a group of almost two thousand parents, all of whom had at least one child under the age of seventeen, to test a simple relationship: Could various pro-vaccination campaigns change parental attitudes toward vaccines? Each household received one of four messages: a leaflet from the Centers for Disease Control and Prevention stating that there had been no evidence linking the measles, mumps, and rubella (M.M.R.) vaccine and autism; a leaflet from the Vaccine Information Statement on the dangers of the diseases that the M.M.R. vaccine prevents; photographs of children who had suffered from the diseases; and a dramatic story from a Centers for Disease Control and Prevention about an infant who almost died of measles. A control group did not receive any information at all. The goal was to test whether facts, science, emotions, or stories could make people change their minds. 
The result was dramatic: a whole lot of nothing. None of the interventions worked. The first leaflet—focussed on a lack of evidence connecting vaccines and autism—seemed to reduce misperceptions about the link, but it did nothing to affect intentions to vaccinate. It even decreased intent among parents who held the most negative attitudes toward vaccines, a phenomenon known as the backfire effect. The other two interventions fared even worse: the images of sick children increased the belief that vaccines cause autism, while the dramatic narrative somehow managed to increase beliefs about the dangers of vaccines. “It’s depressing,” Nyhan said. “We were definitely depressed,” he repeated, after a pause. [More]
OK, let's get past the moaning and figure out what this means to our respective business plans. I'm thinking we get out of the GM promotion racket. If this was a side enterprise on our farm, results like above would have pulled the plug on persuasion long ago. I suppose as long as Monsanto et al, are paying for it, what the heck?

I'm ready to stop pouring time and political capital down this lost cause rathole. Despite frantic pleas from our suppliers, I don't see strong efforts to outlaw GMO's on the most distant horizon. The effect will probably just show up in consumer preferences in the marketplace. And we are not moving that needle in the right direction.

I also think GM inputs could be revealed as luxury items as corn slides toward $3. Maybe it is great stuff, but it's rapidly becoming great  stuff I can't afford. US producers have "scienced" themselves into high-cost producers, and unwinding that economic misstep will be ugly.

So I think I'll listen to my customers, push back against my suppliers, and treat this debate as just another economic challenge. I can live with or without GM products.