 Hello. Today I am chatting with Glen Weil, who is one of the smartest and sharpest of all economists, and Glen is, among other things, the founder and leader of Radical Exchange Foundation. Most recently, he is co-author of a significant study on how we should fight back against COVID-19, and he and his co-authors have come up with a plan, a rather ambitious plan, for a pandemic testing board and hoping to test as many as 2 million Americans each day. Welcome. Thanks so much for having me on Tyler, especially at such short notice. It's really great to be able to talk about these issues with you. We will have our usual wide-ranging chat, but also a lot of focus on COVID-19. Well, let me start with a simple question. Why is testing in America right now so hard to scale up? I think we've got two basic problems. One is a coordination failure along the supply chain, and the other is a lot of small innovations that require a lot of regulatory engagement to get rapidly deployed that need to be really accelerated and coordinated. So if you look sort of deep into the supply chains where they're producing the reagents, where they're producing the test kits, there has not been a clear demand signal to those parts of the supply chain that we're going to aim for a really high level of testing like we're describing. And therefore, there's a real unwillingness to make the fixed cost investments to repurpose manufacturing to supply tests at that level. And we can go into why that's the case in a minute. If you think of closer to the consumer, the issues are actually quite different. They're not really about money. They're much more about the fact that the current testing technology is extremely intrusive and very volatile. So that's the swab up your nose, right? Exactly. Sounds scary. But you want to spit into a cup. Exactly. Or a cup. Say I'm an individual American and we're in a world where tests are easy to get. Indeed, we're testing 2 million Americans a day. So I in fact want to be tested if I'm afraid that information can be used against me, beat me away from my job or remove me from my family. That's a great point, Tyler. So that's the reason why the three pillars of our strategy are testing, tracing and supported isolation. We need to ensure that isolation is accompanied by supports from the public that are sufficient to give people a strong reason to want to engage in isolation. Now, people have a lot of concern for their neighbors. They don't want to get people sick. They don't want to get their families sick. So there's already an inducement isolation there. But especially for Americans who are, you know, have more limited economic means, it can be a huge hardship to be away from your job for that long, which is why we need public support for people who need to be isolated so that they can receive the treatment that they need so that they can receive the food and income support that they need and so that they don't get detached from their jobs. Where physically will we put these people? They are tested having COVID-19. Where does the truck bring me, so to speak? I don't think a truck brings you anywhere. So the vast majority of people in the Asian countries that have been most successful in containing the disease have isolated at home, sometimes being isolated even from their families, but, you know, overwhelmingly at home. For visitors from abroad who have no clear resonance in the country, there may be some dedicated facilities, particular types of hotels associated with isolation, but that's going to be a very small minority of all cases. Is there enough trust in America to pull this off? So even if you write down the rules of the game and they sound fair, even the people don't trust the federal government. They don't trust Donald Trump. They may not trust, you know, the Democrats and Nancy Pelosi. Won't people really still run away from the test like a plague? We don't know how long immunity lasts. If there's immunity, how long contagion lasts? I just don't want to know. I'll behave carefully enough that I don't feel guilty. Otherwise, I'm like, keep that test away from me or not. Yeah, I couldn't agree more that there's a systemic lack of trust, especially in federal government in this country, and that is why we believe that the most effective way to make this work is by drawing on institutions that have a lot more trust. A lot of the leading businesses in this country have a very high degree of trust. The state governments, local governments have a very high degree of trust. So we need a strategy that, you know, has a role for the federal government in funding and coordinating the parts of this that absolutely need the federal government in terms of the supply chain, beyond that we want to empower those localities and trusted businesses to be the ones who both execute on and lead the public communication around the strategy. And there's a well-worn tradition of that and something called an interstate compact, where the federal government can provide funding, but it's actually administered by state governments and often staffed by the private sector. What rate of false negative are these tests not worth doing? Probably around 50 to 60%. Now it depends a huge amount on whether those false negatives are what we call permanent false negatives or whether they're from poor administration of the test. If they're from poor administration of the test, you can just give a test multiple times. And it appears that most false negatives are currently from poor administration of the nasal swabs, which by the way is another reason why moving towards the spit test is so desirable, because it's much harder to screw up. The spit test doesn't do better on false negatives, right? In the best case, it could, so swabs are more sensitive if they're correctly administered, but they're very easy to incorrectly administer, because they're a very invasive and complicated procedure. The spit test is much less prone to that sort of human error. And so may actually in practice perform better, even though the nasal swab has the potential to do better. What do you think is the rate of false negatives right now? Probably about 20%, 20 to 25%. What rate of false positives are these tests not worth doing? I think that even a relatively low rate of false positives could create a huge problem here, because the disease prevalence is not that high. And so if you start getting a lot of false positives, pretty much everything that's going to come up is going to be a false positive. Luckily, the PCR tests have shown a very low rate of false positives so far. But is there data on false positives very reliable? Because don't have another test to test the test, right? It's never been a control group and we subject people to all the different tests and then find out if they really had it. We have a lot of uncertainty about test quality. So I think that that's true. I also think that we're not getting a huge drag net coming out of these PCR tests in countries where prevalence rates are low. And you would expect to see that if the false positive rate were non-trivial. So in Korea, they're administering a lot of these tests and they're getting about 2% of tests coming back positive. If you look at countries where we know that there's very low prevalence, you would expect that even if there's zero prevalence, you would be getting a significant false positive rate. The fact that some countries are really getting close to zero tests coming back positive suggests that there's a very low false positive rate. If we look at Singapore, which has done a lot with testing and track and trace, it seems at least superficially they did many things right. Now they're back to having over 900 cases a day and they're about the size of Fairfax County and have incredible governance. But what did Singapore do wrong and how will we avoid that same mistake? So the truth is I haven't followed the Singaporean case recently closely enough to figure out what went wrong recently. My impression is that they put too much confidence into a particular digital tracing system, which turned out to get very low take up. And they pulled back on their manual tracing efforts before there was reason to be confident that they had the ability to pull back on them. There's also a big problem, which is that manual tracing efforts do a poor job of covering public spaces. And I think that the Singaporeans believe that these Bluetooth based tracing technologies would cover those public space as well and they failed to do so. And they're therefore allowed redensification of their public spaces too quickly. And I think that's something we need to be very careful about. But whether or not we make those exact same mistakes. The fact that such a high quality government made mistakes, didn't we really truly fear the United States with 50 different state governments, a barely competent federal government if that will make a lot more, you know, possibly quite different mistakes. I mean, how confident are you about how this is going to run. Well, look, I think that there is likely going to need to be some capacity for states or localities, probably through some sort of identity certificate or something like that to potentially limit travel across jurisdictions. In Canada, they've done that across provinces. This would limit travel across some US states. Yeah, I think so. I mean, I'm, I don't know if it will come to that there's a possibility that we get very successful here in a very uniform way. But for the reasons that you're saying because of the federal federal structure. I think we're going to face a choice between centralizing power more than I think we should want to. And in a way that would reduce the combat scope for desirable experimentation and allowing some restrictions on travel across localities. It's way I look right now at New Zealand, Hawaii, and the Faroe Islands. In fact, also Taiwan, they're all doing a great job. We're all like island in some way or they're literally islands. Yeah, isn't so much of the game just from reducing the travel. And if we reduce travel, not worry so much about the tests we get most of the gain or no. Well, there's plenty of islands that have restricted travel, at least at some point, and have failed. So the UK has had a terrible experience and is also an island. So I don't think it's enough. I mean, if you're in Hawaii, it's pretty carved up even within Hawaii and there's not much mobility. I mean, look, I think you can. You can certainly achieve a lot if you don't yet have the disease in country that way. There are not that many places in the US that have low enough prevalence that I think that that would really succeed. But it would probably succeed for some localities. I just think it's not a comprehensive strategy for most of the population centers of the US where prevalence is already high enough that trying to treat yourself as an island is not really going to accomplish a lot. Give me a sense of the timeline of what you're proposing. How do we get the rate of transmission down to how quickly, how quickly do we get tests available? And then when do we reopen the economy? What was the ticking of the clock? There's one really critical element of this plan that I don't think has been widely discussed, which is that there are 40% of people in the essential sector who are still out there doing their jobs. And there may have been some improvements in sanitation. There probably have been though there have been a lot of issues with getting the PPE required to do that. But those people are basically transmitting the diseases they always have been. And so by far our first priority has to be not quote reopening the economy, but rather stabilizing that sector of the economy so that transmission is not taking place within that sector. Once we've accomplished that goal, it will actually be relatively easy to reopen the rest of the economy because it will, you know, given that that's 40%, it's just a doubling to get to everybody being in a disease stabilized situation. So I really think the focus has to be on stabilizing the essential sector by building up this regiment. I think we can do that by the end of June. And once that's accomplished, I think we can over the course of July reintroduce most of the rest of the economy and have the confidence that because we haven't seen reemergence of diseases within the essential sector that reintroducing everybody else will proceed in a similar fashion. I think if people are paying their rents and maybe more importantly not paying their mortgages, I worry say within four to six weeks, whole banking system will be insolvent. I don't mean a liquid where the Fed can prop it up. I just mean flat out permanently insolvent who isn't there some very rapid irreversible nonlinear deterioration going on, and we'll need to reopen more than we would like to pretty soon no matter what our level of testing is what do you think of that claim. I think I think it's a little bit extreme but I'm certainly inclined in that direction. The problem Tyler is that if we reopen under the current conditions. We're going to see and this is expected by all the epidemiological models a resurgence of the disease, probably sooner rather than later, and we're going to have to lock things down again. And I think as problematic as it is to keep things closed for another month. Plus, it's going to be much more problematic to suddenly and unexpectedly every so often have to shut everything back down again it will completely destroy the capacities of businesses to plan. If that is looming out there, whereas if we can plan for some period of bridge loan some period of, you know, the Fed bailouts, etc. Then at least we can get that into a bill and get ahead of it, rather than relying on people to just have to deal constantly with new crises emerging. Let's say we never soon figure out the puzzle of immunity, how immune you are and for how long, and we're not sure how long contagiousness lasts, and you get a test, and we learn that you've had COVID-19. We're not sure if you're immune or you're contagious for two months what do we do with you what box do you get in. So, I think, serological tests, if we get them working and they're not really working very reliably yet can be quite helpful for that, because there's one of the antibodies. I always forget which one it is MMM or MMG, but one of them is an indication indicator of convalescence and at least temporary immunity. So, serology is very useful in that case. It's also widely believed that if you've had a period of symptoms and no longer have symptoms. And though this is not known for sure because we have seen some returns of it in South Korea, but it's believed that during that period when you don't have symptoms, the amount of the virus that you're shedding is low. So, I don't think we can quite say that those people are immune until they get a serology test, but I think at least they can go back to sort of being in the same condition as the rest of the population unless we see a resurgence of symptoms. And what are the labor requirements for following up on people who test positive? You track them down, you call them up, you text them reminders, whatever is going to be done. How many people do we need to hire and train to do that work? We're somewhere on the order of a few hundred thousand. Precisely how many depends really on how quickly you want to follow up on the cases because you know you can have one person in each case or you can have multiple, but some somewhere in that range. And by the way, the Australian government managed to train 20,000 people in a week who had been laid off from Qantas. So we definitely have examples around the world of this being done. And I'm hopeful that we can replicate this in the U.S., even accounting in rural East Texas has managed to do this quite rapidly as well as the state of Massachusetts. So we already have some success studies on that. And the party ultimately making this work, is it the federal government or the state governments? Or if there's a disagreement, who or what's the final adjudicator? So I think it's going to be many different things with many different roles. But if you're talking about the pandemic testing board, that would be the coordinating body. I prefer though it could be a national form or it could be an interstate compact, but I prefer it to be an interstate compact, in which case it would be a consortium of governors who would be the final authority. But they would appoint the pandemic testing board, which I think would be mostly staffed by retired generals and business leaders, as well as probably someone representing labor and so forth. And say my employer tests me, maybe it's George Mason, and the test is wrong, false positive, false negative. Can I sue them or is there a complete liability waiver here? So I think employers should have a responsibility to use the best tests. That's a pretty high false rate, right? So high false negative rate. At maximum 1% false positive rate. Because rate could be over 30%. So if result is wrong and you can sue your, your boss. Uses won't want to test you. So I think that they should have a negligence requirement to use the best tests available, but I don't think that they should have a strict liability requirement that if anything goes wrong, it's their fault. But we'd have to get through all the different court systems of the country, some kind of agreement on liability, right? And just for going back to work. Yeah, I think that's fair regime. I mean, I think the pandemic testing board should have some authority to set, you know, guidance about that and my guess is under standard common law approaches that there would be a fair bit of deference to that by, by most reasonable courts. I can't say that that would happen everywhere, but that would be my guess. Let's say I love taking the test. I take the test every week. It clears me every week. Do I get a certificate? So we believe that taking the test frequently enough. And I don't think once a week is enough. It should probably be twice a week. But that that should give you an equal status to someone who's been shown an immune. I get a certificate proving that. And it's like for both for both of those cases. So both for immunity and for if someone takes frequent tests, we don't think people should have the right to do that until we have enough tests to do the more basic regime. For the whole population, but eventually we would like to make them available through a more standard price mechanism like you're describing. And then, especially in essential sectors. I expect yes, there would be a certification process like you're describing for people who are either known to be immune or for people who take frequent enough negative to get free enough negative tests. We end up with a segregated nation. I don't think so because I think that first of all, we will not make that available. The immunity certificates or these ones that you're talking about the frequent negative tests until we've already managed to really control the disease enough that we feel comfortable for people going back into most public amenities, just based on the fact that we're tracing down most of the disease so really the only reasonable purpose of those types of things either immunity or frequent negative tests would be for jobs and extremely sensitive professions where you're close to people who are in a very vulnerable part of the population. If I can't get a certificate for a long time. Doesn't that mean I just don't want to take the test is no benefit for me. So, until that time, all the tests are being used in a test and trace regime. And if you test positive in the test and trace regime, you will go into supported isolation so both, you'll end up having your health protected, but also you'll get the support so that you can receive the, so that you can actually be just as well off as if you didn't get the negative test. Seems to me trust there will be very weak. I wouldn't believe they're going to send me enough money. If they tell me they're going to send me a nurse I worry about rate of contagion amongst healthcare professionals. This is the support I get that's so valuable. I mean, I think that getting the precise parameters of that right are really critical. Tyler and I can't say that I've gotten down to the level of precision necessary because there's obviously a real trade off there between not inducing people to voluntarily get the disease in order to obtain the support, but also not getting you know, so low that people don't want to go into that regime. I think there is an incentive compatible place between there. I'm not sure precisely how to set it. We do know that in the East Asian countries with a wide range of government structures. You know, it seems to have worked out reasonably well and they've managed to induce most people to isolate I also think there's a fair bit of sort of altruism and desire to protect your family, which doesn't go all the way but it helps. You know, broaden the range of incentive compatibility there. What do you think of the Robin Hansen point, and this is not a question unique to your system at all that many young people will want to expose themselves to limited doses, in order to get immunity at some point certificate reenter normal life. And can that be a feature of the system rather than a bug. I think that that is not desirable because during the period. We don't know how asymptomatic and pre symptomatic transmission precisely works here. And I think a lot of young people if they do that would be putting their more vulnerable and elderly relatives into a lot of risk. I think that's something we would like to discourage but I don't think it's something that we should have more than social sanctions against. You were estimating a benefit cost ratio for your plan what would that number be. Well, it depends on what the alternative plan is but I think the most natural continuation of the mess we're in. I would say 10 to one so I the costs that we estimate of our plan are on the order of a bit less than a month of continued freeze in place. Percentage of Americans do you think will download tracing up. I think it'll depend a huge amount on what part of the country you're in. So in suburban rural areas. I don't think many people will download it. And I don't think there's any reason for them to. I think in areas with a lot of high density public amenities, a lot of people will download it and some of them, especially some of the private amenities may choose to require you to show that you have the app before you enter that private amenities. We all know when doing policy proposals go through the Washington DC meat grinder and the state and local government meat grinder. What do you think about the trade off between getting this done quickly and getting it done the way you want it to be done. Let's say your version is the best version. You want speed more importantly you're getting it right more importantly. Well, look, there's a clear trade off between the two of them. And there are sort of minimum requirements that are needed to get this working at all. And I would say those things have to be met. But the fastest possible subject to those being met is probably going to be much more important than getting it all precisely right. Now, how do your views on testing differ from those of Paul Romer, if at all. So, overall, I think there's a lot of similarity between us and Paul, Paul believes in mass scale testing and we do as well. Paul thinks that tracing is so problematic that he would rather see universal very frequent testing. Rather than tracing being used to reduce the number of tests necessary is plans correctly calculated would require something like 10 to 20 times the number of tests that ours would and therefore has cost much closer to something like $500 billion rather than 100 billion. It would also be much more intrusive because there would be a much greater reliance on these negative test certificates that you were talking about earlier, Tyler. And therefore, I think from both the civil liberties and a cost perspective, I strongly prefer a regime that also involves tracing. But look, Paul's plan and the other thing I would say is because it's so ambitious Paul's plan on terms of the number of tests required will take much longer to ramp up to that point so we'll end up with one two more months of freeze in place. Overall, I think that there's a strong case to be made for test trace and supported isolation, instead of just testing, but on the other hand I think it's great that he's advocating an ambitious target just as we are. What do you think of the plans that say we should try to predict who is a super spreader and then test them incredibly often, and maybe we won't get that far and universal testing but we'll get most of the gains. Testing nurses, testing people who shake hands a lot, testing the extroverts, whoever people are at these nodes, maybe they work in nursing homes, whatever we find safe from analyzing big data. How effective would that be? So I certainly support some forms of that. I think testing essential workers, especially in long term care facilities, where there's a possibility not just for a lot of spread but for a very dangerous spread makes a lot of sense. I think having a very top down regime of someone analyzing a bunch of data and on the basis of some probably pretty tenuous statistical correlation claiming that such and such a person needs to be tested, and then sort of coercively going in and testing them on a government does not seem to me like a very robust regime. So I think that there's some robust elements of this that I would love to see implemented, probably largely through private demand, you know, for I want my person taking care of me to be tested. And then there's other things that seem to me sort of problematic and potentially, you know, authoritarian. Here's a question from a reader and I quote, what are the best ideas for applying radical markets to the COVID-19 crisis? Okay, so I think some of my favorite ideas actually aren't necessarily on radical markets but on radical exchange ideas more broadly. So like, for example, I think a huge problem we have right now is that cultural industries are struggling to survive or thrive in the internet world and we're now suddenly completely in the internet world. So all the possibilities of doing, you know, in person gigs that were really supporting a lot of the music sector are gone. So I'd really love to see a pool of funding be put into the sort of matching mechanisms that we've been emphasizing to sort of improve the environment for things like Patreon and Kickstarter to fund cultural innovation that will help sustain morale during the times when people are separated from each other. So that they could write better incentive compatible contracts by drawing on your other insights, and that would help these people raise money and support themselves. That's the idea. More generally about the crisis should we allow price gouging, say for masks or reagents. Um, so I don't like calling it price gouging by the way. Yeah, I think the problem I have with the price mechanism here is not the usual quote price gouging or durable pricing, but the fact that this there's so many externalities in the allocation of some of these critical inputs here. And in principle, we could try to price those externalities, but in practice, trying to get such a pricing mechanism and sort of the information required for it in place quickly is going to be very hard. And so therefore, I think we need to have a lot of non price allocation, not of the whole economy, but just of the like really critical elements like testing and certain types of PP because I think otherwise we're all going to be harmed by that not being allocated to those nodes as you were talking about, where they have the largest costs associated with it. If we need to do two million tests a day or whatever is the number. Yeah, if you're a little skeptical about targeting the super spreaders, or you just want high prices, mobilize elastic supply as quickly as possible. Yeah, you definitely want high prices of the suppliers for sure. Absolutely. I just don't think the best way to do that is by on the demand side allocating according to the price mechanism. So I absolutely agree with Alex Tabarock that things like advanced market commitments that throw a lot of money at the supply chain, make a ton of sense. But whatever comes out of the supply chain, I don't just want allocated by the price mechanism to a bunch of rich people who want to go out and have dinner somewhere. I want it allocated to the people who are going to spread the disease the most is that will let everybody go out and go back to normal life at a much lower cost. It seems a lot of the rich people have been big spreaders, right? And Charles Boris Johnson, Tom Hanks. Yeah, I mean, I'm not saying that there wouldn't be some of that, but I wouldn't say that on average that's going to be the case. I mean, you know, a lot of the long term care facility workers who are the some of the most dangerous spreaders are not people of a lot of means. Now in economics, why is price theory so falling out of favor. I think price theory is actually making quite a bit of resurgence in the last, you know, couple of decades. You know, Raj Chetty, Amy Finkelstein, John Levin, people like this who've won the John Mates Clark Medal recently have really drawn on it a lot. I think it fell out of favor in the, you know, 80s and 90s, largely because of, you know, a lot of the rise of sort of the mathematician of economics the rise of technocracy within the profession, the increasing focus on sort of refinement of methods, as opposed to engagement with the public. So, I think that those were some of the underlying reasons there's also an association with the University of Chicago, and a particular ideological view there which sort of mixed it all up with politics and that's something that I think has become less and less true with this new wave that I was describing. Now you're a reformer how would you reform the economics profession, which you've seen from a number of different vantage points right. Yeah, so I mean I think one of the most important failings of the economics profession right now. And I think this is something you're doing a great job of trying to rectify with the engagement work you do has to do with the lack of accountability to public discourse. And this is something that's really systematic across American society, not just in economics, but there's a very unhealthy relationship to expertise, where either there's sort of a total disregard of and distrust of expertise, or a deference to it, rather than the notion, you know, if you look at someone like Milton Friedman, that the way you judge an expert is by their ability to distill things down and convey a message that becomes part of the public discourse. And I think that's hurting us in the COVID situation and I think it's been a disaster in the economics profession. What's the mechanism design you would implement get us there, but we might all agree with the outcome. What do you change in your procedures, your review. Yeah, I mean I think that one thing we need to change is the way that universities evaluate professors for tenure, and the way that we evaluate people for prizes. I think it needs to be there needs to be a much much greater emphasis on your ability to bring things into public in evaluating people rather than just the esteem of your colleagues and getting the right metrics on that is really tricky thing I bet it's something you've thought about actually Tyler, but I but I think we need to be bringing that public engagement and delivery of things directly to the public, much more into how we evaluate people you look at someone like Henry George, Henry George, you know, was one of the great economists, and he ran for mayor of New York. And he actually beat Theodore Roosevelt. So, you know, I'd like to see more economists living that sort of a life and Milton Friedman obviously had a bit in that direction John kind of Galbraith we need we need more of that. Here's another reader question quote, how have the events around COVID 19 changed Glenn's views on radical exchange and related issues. Well it's actually kind of interesting because the first thing I wrote about COVID was not the stuff that I'm doing now but it was about Taiwan's experience and how much better Taiwan had done and it appears this is still going, then even places like Singapore and China. And I think one critical reason for that is that Taiwan has this really rich democratic technology tradition in which citizens are engaged in making them, you know, technical technical tools that then help scale up and govern the country. And I think in China and in the US for different reasons, the technical elites are quite divorced from those who's tech, who their technologies meant to serve, and therefore they've been very poorly responsive to the emerging issues on the ground the signals have not been reaching them from the local very effectively. And so that actually makes me believe that radical exchange ideas, maybe a very powerful mechanism for warning us about future crises it's very hard to innovate in those fundamental ways in the midst of a crisis, which is why at some level, the proposals I've been pushing for this have been sort of conservative in nature in drawing on things we really know have worked in the past rather than experimenting with new things. But I think as a early warning system for this type of thing I believe all the more in that type of democratic technology. You may wish to challenge the premise here. Why do I see so little talk about the blockchain during this pandemic just doesn't seem that salient. First of all, I don't think blockchain is very salient period. You know, if you think about the conversations around technology and society AI is way up there, Internet of Things is way up there. Blockchain is pretty far down in terms of the broad public imagination within the blockchain community. Obviously, that's a bit different. I think there has been quite a bit of focus on what are the best ways to do things like contact tracing. Now, if you call that blockchain or not as a bit of a question, but certainly privacy preserving cryptographic, you know, technologies if anything I think are getting more attention now that they were getting before, because of the emphasis on trying to do contact tracing in a privacy preserving way. And then possibly the adoption of your plan. What do you think will be the most enduring economic or social change from this pandemic. My guess is that there will be a lot of large corporations that take on important social responsibilities because of the trust environment that you were talking about, and that it becomes increasingly illegitimate for them to be run under maximization perspective once they're taking on that role. And so I think we're going to see fundamental shifts in some of the corporate governance parameters as a result of the social role that a bunch of companies end up taking on. In the middle of these dialogues, we have a section overrated versus underrated. I have some easy ones for you. Are you game. Yeah, sure. Rio de Janeiro overrated or underrated about correctly rated I would say. What do you like most about it. Best placed in the world to be as a tourist, but a very challenging pace to live and be productive song by Don McClain American pie overrated or underrated. Oh, that's one of my favorites underrated underrated what's so good about it. It manages in a very accessible and catchy way to be just sort of elusive enough about historical events that you can make sense of it, and yet still appreciate the poetry and complexity of how it's speaking to things. I mean, don McClain have a better career right there's starry night and then it seems to end or am I missing something. So I actually don't know much about the dynamics of his career, and I like a couple of his other songs but I agree it is kind of remarkable that that's that he such a one hit wonder. How much people respect law in Latin America, the typical educated outsider underrate or overrate that law abiding this, the Latin countries. I think that they think people respect law to more than they actually do, because I think that they don't really see the favelas and the you know the informal settlements very much on most standard trips and they don't realize how pervasive the fact that people are living, sort of outside the law is to the way that everyday life works in Latin America. Julius crying overrated or underrated underrated. So first of all, Julius and I disagree on a great many things, but I have a huge amount of respect for his intellect. And I think he's one of the people who really challenges a lot of the ways that people have fallen into thinking. And he did it really at a time when I think that was incredibly necessary. So I'm a big fan of his I really like collaborating with him, even though in some ways we're sort of polar opposites I mean he's a, he's a nationalist I'm very much a anti nationalist in my basic outlook. What was Milton Friedman most wrong about a monopoly power. So you just a little more. Yeah, so Milton Friedman, you know if you read capitalism and freedom. It's, it's beautiful. It's one of my favorite books, and I actually think it's very similar to Rawls. And it's funny because a lot of people on the left love Rawls but they hate Milton Friedman. And I actually think their visions are very similar I think both of them dramatically underestimated the importance of increasing returns phenomenon. Friedman says, well, there might occasionally be a temporary monopoly, but you know it'll go away because of competition anyway. And we need to, you know, try to just avoid it becoming too permanent by the government getting involved in and so forth. I don't think he perceived that increasing returns phenomena that tend to create monopolies are really the foundation of what creates the possibility of civilization. Right in the back of his mind, this sort of decreasing returns model that's dominant in economics. And I think that that colors his whole world view in a way that leads him to sort of miss a lot of the key questions, even though he was right on a lot of the things that he spoke about actually so I'm actually largely sympathetic to a lot of Milton Friedman's ideas on the things he focused on, but the problem is the things he focused on weren't the key problems I don't think. Speaking of increasing returns what's your favorite movie. Memento, why, because it captures a really critical philosophical issue in an extremely engrossing thriller fashion. And it's sort of like Don McLean you know it's sort of like it's getting at something deep and rich but in a way that's broadly accessible. What makes for a good movie critic. You were what you were a movie critic. I once tried to be one. I once tried to be what I don't think I was all that successful. And you know I don't read nearly as much movie criticism as I had as I used to in the past. I think. What I like in a movie critic is when they're able to capture the emotional feeling of a film and what it would be like to experience it without talking too much about what actually happens. What's the best place in Latin America to go see turtles. You know, I love turtles and I love Latin America. And so, but I don't feel I have a definitive answer to give to that I do have the place that I've enjoyed seeing turtles, most which was a Puerto Escondido, which is just a relatively small where we saw some nice turtles but I don't, I'm sure there are better places. I've heard that some of the islands off of Venezuela are some of the best, but my wife got banned from going to Venezuela, because you wrote a critical report on the government. And so we've never been able to go to Eastland Margarita which is supposed to be Magdalena I believe that which is supposed to be one of the best places so one of the ideas you pushed earlier in your career and not that long ago was quadratic voting. Yeah, which would place greater weight on more intense preferences. Let's say we take the current pandemic. And right now we had some form of quadratic voting. What would that change the nature of our response. So I'm a big fan of quadratic voting still. I think the question is quadratic voting for precisely what the things I'd most like to see quadratic voting be used for in the pandemic responses eliciting from people sort of informed and rich feedback about what things or they value or what elements of the response they value most. And I think it could be quite powerful there in in allowing basically large scale deliberation in a remote fashion. I think we would learn a lot more about what elements, for example, of the social distancing are hurting people the most, and what elements people are most willing to accept. And we might get a much richer picture of sort of the cost benefit trade offs that we're facing which I don't think have been very well factored into public policies. Do you think we as a co-activity would value human lives more or less with quadratic voting. I think probably quite similar. But I think that a lot of the more rich and nuanced things like for example, restrictions on parks versus restrictions on theaters. I think we've learned a lot about what's most important to people there. Let's say you're applying your ideas on mechanism design to hire education. In general, what would you change. Well, I mean one thing I've thought about quite a bit has been the evaluation of people for tenure and some of the publication stuff. I don't know if that's higher education really though because I'll ask you about students next but your idea for that. Yeah, so we've been working for a while at radical exchange on trying to create a new system of sort of peer review and journals, where rather than having a set of authors and then referees and editors. Instead there's just a ordered list of people who sign on to the article. So that, you know, authors would have the first chance to sign and maybe editor next and the referees next. I think this would be a much more incentive compatible way to get good quality referee reports and to actually allocate credit in proportion to what people have contributed to making an article work. As compared to the current system where there's a very binary division between the authors who get credit and everybody else who gets very little and I think you could add into that some really rich stuff around having some quadratic voting in there. Maybe having sort of individualized views of how many citations or how much respect someone gets from a journal based on who you respect and who they respect and how that filters through. So those are, I mean I'd have to go into more of it but I think that those are some ways you can put these elements together to get a much better approach to understanding how you evaluate a scholar. This is a mechanism designed to improving admissions right. It's been very controversial. It seems unfair. Some people would say intensity of preference being counted as the problem. You agree. So I think it's really critical in admissions that we, and this is a really different element than intensity of preference, but that as the American system does at the point when people need to make. Costly investments in figuring out what places they like that they have a sense of who might let them in. So if you think about the medical match system that you know our office very famous for being involved in and you know Gail and chapley. They have a system where you rank all the institutions before you know which ones are going to admit you. And that requires you either to do a huge amount of due diligence about all the different institutions, or to make guesses about where you're going to get into. I think that's not a very effective process, even though it has some other properties that people have highlighted something more like the way that we admit students in, you know, the university undergraduate admission I think is more sensible. And I think there are ways to further improve on that to add sort of more stages of letting in the top matches first, like the people who most want to go to someplace, and the schools most want them and allowing those parts of the market to clear, and then doing the other things later that's a little bit like early admission but actually making it much more finely graded. I'm sure you know at a school like Harvard or Princeton, you can't just buy your way into getting a graduate admission. It's run by the faculty correct. Yeah, we do undergraduate admissions the same way. It would be a lot of work of course, the faculty. I think it's, it's interesting I mean I think you'd probably have to filter a little bit so like maybe it should be graduate students who should be helping admit undergrads or something like that I think it's a very interesting idea. I wrote a paper in 2009 called, whose rights question mark a critique of individual agency as the basis of rights. You think now standing in 2020 are individual rights, ever an appropriate concept to invoke to argue for or against a policy. So I think almost any moral concept is a useful concept in certain contexts, because all our ideas are proxies for some deeper truth that we don't fully understand. So I often make arguments about individual rights, individual liberties, even though I ultimately think we need to get past our standard conception of individuals is atomized and understand individuals more as being sort of an intersection of different social circles that they're a part of. But, of course, you know the more sophisticated these ideas are the more true to reality, the more complicated and foreign they are, and we always need to strike a balance between clearly communicating and you know very, very similar to to the reality we're trying to describe. So I still think in principle that either group rights can be meaningful, or even a component of an individual could have rights, and that there's no particular reason necessarily stop at the level pinpointed methodological individualism. Yeah, and in their description. Yeah, yeah, I would enrich that story a little bit because I, and I alluded to this in that original piece but now I have a clear sense of it. I think often the parts of individuals that we're talking about actually are associated with various groups. So I think we should think of individuals as being made up of group identities to a large extent and group identities as being made up of individuals to a large extent. And so I think we should be moving towards a dual perspective on these things, rather than a grounding that sees one as sort of the end point that composes the others. This would be one foundational reason why you're less libertarian than maybe you might have been before you wrote the paper. Yeah. The practical reason would be increasing returns. Correct. Yeah, and those are I think actually just two different ways of expressing the same thing. So I view the fundamental role of groups as, you know, just a different way of expressing the notion of increasing returns. So what's the unified theory of you and what you believe? You know, I don't often have time enough for the meta rationality that that requires David Foster Wallace was one of the most remarkable people at doing that sort of thing. I aspire to it, but I haven't had quite enough time to figure it out. The unified theory of you I toy with I'm not at all sure it's correct, but maybe you can nudge me a bit on it. At heart, come out of the Jewish socialist tradition through a matter of biographical accident, you first became a libertarian needed time, find your way back to the tradition you belong to along the way did economics. You believe in some notion of markets will be it correctly adjusted by regulation and mechanism design. You've moved away from methodological individualism for you this weird person of the Jewish socialist believes in markets and had this path leading away from libertarianism like no other person in the world probably is that but you are. Is that a unified theory of you. Well, the thing that throws a little bit of wrench into that is that I was actually a Jewish socialist before I became a libertarian strength and are weak in the theory. Well, the thing that's funny is that it's certainly the case that I came back to identifying with my Judaism, at around the same time that I was starting to move away from libertarianism. I don't know if that's because of the entanglement between sort of the collective element of religion and the ideological element of this other stuff. You know, I think from my unified theory of me on those lines has always been that I've been someone who's hugely about Hegelian synthesis and trying to find things that seem persuasive and to find a way to simultaneously fully embrace them both in my mind by finding some syncretic fusion of them. And so I, you know, intellectually that's something that is quite important to me and I actually saw from my senior year of high school, I had a, I had like a capstone project, which was about conservative liberalism. And when I read it, it reads a lot like what I'm writing recently. So the reality is, I think I have these themes of trying to find synthesis of different things, and those keep recurring and getting nuanced by the more I learn about different fields. As you well know, there's a long standing historical connection between Judaism and socialism. There's no Marx, Moses S Edward Bernstein, one could go on with this. Yeah. What do you think ultimately is the foundational reason that historical connection and yourself as well right. Well, I mean I also think there's a deep historical maybe even stronger historical association between Jews and capitalism. And I think it really has to do much more with just abstraction and the ways in which Jews have engaged with the economic world, coming from the ways in which they've been able to express their political voice, the fact that there was literacy earlier in the Jewish community than there was in many other communities at a broad scale that, you know, I've actually written about that issue and why Jews have been so engaged with economics. But I don't think it's really socialism in particular it's both socialism and capitalism. You know, if you look at the Nazis they often depicted, you know, one Jew of socialism and one Jew of international capitalism sort of both eating the German nation. And so Jews have always been put in that position of sort of representing these abstracted economic systems, rather than one or the other in particular. Our final segment is about what I call the Glen Wilde production function. This is about you. Simple question. At Princeton as an undergraduate, why did you roller blade the class. So I had always been into rollerblading. Since I was very young, and I thought it would be a good way to get around Princeton though the hills ended up playing a having a big challenge for getting around on rollerblades, but I pretty quickly abandoned it for that reason I didn't really like biking like other kids did. And luckily, it caught the eye of my future wife so that was great. What's your own account of why you were so successful before the age of 27. I think I developed intellectually much more quickly than a lot of my peers, and I developed physically and emotionally a lot more slowly. And eventually I had to balance those things out. But as it turned out that made me very unsuccessful until I got into high school, very successful from high school through the very beginning of my career. And then I faced a number of challenges because of it after that so I think they're just different times in life where different forms of development are more important than others. If you're looking for talent and young economists, other than the obvious like people who work hard. What is it you look for. I look for people who have a ability to see beyond the ways in which the field shapes them to see well at the same time internalizing it, who can sort of live within the world of economics, and then also see it from the outside. What do you view yourself as rebelling against the foundational level. Robin Hansen Robin me is rebelling against hypocrisy. I think he even might agree with that what are you rebelling against. I think I'm most deeply rebelling against the separation between the role of the expert and the role of the politically engaged, you know, person. I grew up wanting to be a politician for long periods and also wanting to be like a physicist for long periods. And I'm deeply frustrated by the ways in which these things are these separate and contradictory roles in our society, and, you know, and sort of struggling to straddle the divide. That's a good answer but if you had to boil it down to something more foundational. What institutional failure or what personal quality lies behind that. What would that be why do we screw that thing up. I mean singular identity is one way of putting it you know people many people are economists think they're an economist many people who think that they're libertarian think they're a libertarian. That's the identity that I've been part of that I thought I believed in ended up having so much corruption in twine in it, and ultimately like it's the plurality and intersection of those things where I find meaning. And so it's that sort of singular definition of, you know, what I am who I am that that I think I find most constraining. People aren't Higellian enough, and there's a lot of corruption out there. And that's a big part of what you're rebelling against. Yeah. So let's say I'm a young person maybe I want to do economics, or maybe I want to be a politician, or I'm conflicted. And I go to you and I say Glenn. What can or should I do to become more Higallian. What's your advice. Travel in different circles, take them all really seriously, and don't let yourself totally compartmentalize them. Ask why there are contradictions, and what it means, and don't get intellectually lazy about just writing it off to people being different. And while thank you very much and again for our listeners and readers. I recommend you all read Glenn's new paper, authored on the fight the pandemic. Thank you Glenn. Thank you so much, Tyler.