Yonatan Zunger about fear, exhaustion, but also hope

Here is an excellent post by Yonatan Zunger about how the Internet has developed into a “moral prosthesis” that lets us know about and empathize with the troubles of people everywhere. This is exhausting, but it may well lead to strengthening our social bonds, when we learn how to manage the stress it comes with. I strongly recommend reading the original at the link.


Polarization of blogs

I am preparing fresh lecture notes for my course on the economic theory of networks that starts on January 12. Just now, I wanted a recent image (and explanation) of political polarization online. Quickly enough, a Google search brought me to this interesting blog post with a fairly striking graph.

A related discussion appears in this paper, written by M. D. Conover, J. Ratkiewicz, M. Francisco, B. Gonc ̧alves, A. Flammini, and F. Menczer.

I quote its abstract:

In this study we investigate how social media shape the networked public sphere and facilitate communication between communities with different political orientations. We examine two networks of political communication on Twitter, comprised of more than 250,000 tweets from the six weeks leading up to the 2010 U.S. congressional midterm elections. Using a combination of network clustering algo- rithms and manually-annotated data we demonstrate that the network of political retweets exhibits a highly segregated partisan structure, with extremely limited connectivity between left- and right-leaning users. Surprisingly this is not the case for the user-to-user mention network, which is dominated by a single politically heterogeneous cluster of users in which ideologically-opposed individuals interact at a much higher rate compared to the network of retweets. To explain the distinct topologies of the retweet and mention networks we conjecture that politically motivated individuals provoke interaction by injecting partisan content into information streams whose primary audience consists of ideologically-opposed users. We conclude with statistical evidence in support of this hypothesis.

Network structure and fat tails in macroeconomic shocks

I just came across a working paper by Daron Acemoglu, Asuman Ozdaglar, and Alireza Tahbaz-Salehi, entitled “MICROECONOMIC ORIGINS OF MACROECONOMIC TAIL RISKS”. Clearly I am a little late to the game, as this paper appeared in an earlier form in June 2013, but it reminded me of this paper, “Network Formation and Systemic Risk, Second Version” by Selman Erol and Rakesh Vohra (who cite what appears to be an earlier version of the Acemoglu et al. paper). I took a look at the latter paper recently. While I have only skimmed the Erol and Vohra paper and only read the abstract of the Acemoglu et al. paper, it seems that both are concerned with how the structure of the network connecting firms or financial institutions to each other can make the economy fragile when random shocks affect parts of it. Surely this is worth reading in more detail by folks interested in network economics, like myself, not just by macroeconomists.