The financial crisis has broadened the scope of the economic policy debate. Pressed by their respective public opinions, world leaders need new ideas, fast. Despite this, one might be surprised by the way German Chancellor Angela Merkel and French president Nicholas Sarkozy dusted off the idea of a levy on financial transactions. Nowadays journalists are calling it Robin Hood tax, but in the 90s it was called Tobin tax and it was part of the intellectual arsenal of the anti-globalization movement. Even then, it was old news: Nobel laureate James Tobin first proposed it in 1972 (the original formulation was aimed at transactions of foreign currency).

The idea is to tax sales of financial assets (equity and/or bonds and derivatives) with a low rate (0.01-0.05%). That’s meant to be too low to discourage the migration of capital from low-yield to structurally higher yield assets (such as from equity in a stagnating company to equity in a highly profitable one), because such a shift happens only once, and the cost of the levy is quickly offset by the increased yields: this way, the market maintains its efficiency property. But such rate is high enough to discourage speculation, that is based on buying and quickly reselling the same assets.

The main practical problem with a Tobin tax is that, unless it is introduced everywhere at the same time, speculators can elude it simply moving to a financial market that does not levy it. In fact, some variants have been tried out in Sweden in the 80s. Results: low revenue, a sharp drop in transaction volume and eventual migration of many of the most active titles from the Stockolm to the London stock exchange. The tax was eventually abolished. So it does not work, right? Why bring it back into the debate?

It’s not quite that simple. It (probably) does not work to stop speculation and generate fiscal revenue. But it could work well for a different goal: driving the more instability-generating fringes of the financial sector (the same ones that make money off that instability, as Nicholas Taleb reminds us) off the country. Their flight can be painful: these are wealthy taxpayers, who supposedly bring prosperity. But it also could be liberating, because the financial sector has become politically very powerful: this (1) makes it very difficult to make economic policy, because the super-rich veto any move that does not imply benefits for them (as Nobel laureate Joseph Stiglitz reminds us); (2) enhances economic inequality, exasperating the non-super-wealthy 99% of the population; and finally (3) it is not even clear that having these rich guys around does bring much prosperity. They sure don’t pay much taxes: Warren Buffett recently declared that his tax rate is lower than his cleaning lady’s.

Are we looking at a cultural shift? Granted, the man in the street never trusted finance, and never understood it. But this is news to me: two world leaders of the standing of Merkel and Sarkozy aligning with people like tax expert and progressive blogger Richard Murphy – who applauded their joint proposal as “a welcome and overdue move [...] if the feral banking economy is to be brought under control” (with the Guardian’s blessing). Why, in the 90s Attac’s militants campaigning for the Tobin tax during G8 meetings were treated as a disturbance by the police forces of those same states.

I am tempted to read this story as the final battle between two different organizing principles, nation states and global finance. Am I seeing ghosts?

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We are rolling out this idea to do presentations of my book without me, run by dedicated, advanced readers. The group of readers that does that is called the Core.

Qualche settimana fa, discutendo su questo blog, un gruppo di ardimentosi lettori del mio Wikicrazia si sono offerti di presentare il libro quando io sono impossibilitato a farlo. Il che capiterà spesso, visto che abito all’estero.

L’idea ha preso corpo. Quello che chiamo il Nocciolo Duro ha già messo in cantiere le prime due o tre missioni. Si comincia domenica 28 alle 21, da Riomaggiore nelle Cinque Terre: la presentazione sarà fatta da Luigi Gioni del Nocciolo, mentre io – banda permettendo – interverrò in Skype. A Riomaggiore Franco Amorese ha fatto le cose in grande, con grande dispiego di tecnologia, live streaming (lo potete vedere anche da questo blog) e perfino una collezione di citazioni su Twitter. Grazie a Franco, a Luigi e a tutto il Nocciolo. Ad maiora.

About a year ago, as I tried to do my bit for Italy’s Open Government silent spring, I made an extraordinary discovery: large, authoritative organization charged with collecting and releasing vast quantities of data were doing so in open form. This happens to be extremely relevant to what I do for a living: combing evidence, using it to build locally relevant world models and act upon the latter to bring about some sort of improvement in our common economic and social environment. Data, obviously, are one form of evidence. Suddenly, a lot of stuff was there, as the World Bank, the OECD, Eurostat and others were releasing large databases for download. I spent some time trying to familiarize myself with the plethora of preview and full-on analysis tools provided, some more intuitive than others; this turned out to be generally tedious and time-consuming. So I started to worry that people would use those data at all: hence my obsession for stimulating demand for data and data literacy.

I seem to have overestimated the tediousness of interacting with open data. A few weeks ago, being in need of some data regarding young people in Europe who are not in employment, education or training (NEETs), I whizzed off onto the Eurostat website and, with a little trial-and-error, I was able to produce the colorful chart above. I made it so that it points me and my colleagues’ attention to a quite powerful story, namely that the transition from partially dependent youth to fully independent adult life has become so long and troubled that the category of “young people” is practically breaking down into a widespread loss of autonomy of the adult population. My work was made immensely easier by online pre-filtering of data: instead of downloading a very large database, Eurostat let me select the indicators, countries and years I am interested in from the website. When I was satisified I had what I needed, I clicked “download” for the system to generate me a file that contains just that. It was more tedious than, say, watching Captain America, but much less so than sifting through statistical tables.

That got me thinking on how the economist’s profession has been turned on its head already twice by new tools in my lifetime. When I got my first job in 1991, I was part of the first cohort of researchers never to have known research without personal computers. Research institutions still had secretaries to type and edit final reports (though those jobs were quickly melting away); my older colleagues had done plenty of solid work on mainframes, pocket calculators and typewriters. One of them was rumored to have inverted a 20×20 matrix by hand while working on an input-output analysis of a local economy. A year later, in London, I lay my eyes on a computer terminal connected to the Internet for the first time; by 1994 using email to transmit digital files across the globe had become normal for economists.

Open data might be the next such revolution. Non-quants like me used to have to go to a “data guy” (it was always guys) for anything beyond copy-paste of pre-produced tables and charts. Cheap statistics software, visualization tools and open data are quickly changing all that: someone like me, with a reasonable understanding of statistics and econometrics, can have a go at building simple regression models on the fly, turning from someone who can understand statistics to someone who can make it. When we stumble into something that seems solid, we can call the data guy to have a look and help us refine it. The benefits are clear: more intuitions can undergo a cheap, fast, rough reality check; and, as we interact with the data, we find ourselves looking up Wikipedia articles on things like measures of fitness and multinomial logits. We become better at processing data, and therefore at interpreting data processed by others. Very possibly, the next generation of researchers will use open data every day, and wonder how could those old people in the 2000s (we) managed to do any work without them – just like me wondering about my poor old colleague and his hand-inverted 20×20 matrix.

Pedro Prieto-Martin, a Spanish researcher and occasional commentator of this blog, just published a paper on the state of the art of e-participation in Europe. Which turns out to be pretty grim:

• The European Commission has taken the lead in promoting the discipline, launching several dedicated research programmes
• since 2000 the EC has funded at least 74 e-participation projects, for a total cost of about 187 million euro; a network of excellence for another 6; and, later, a batch of evaluation and networking initiatives of the existing experiences
• one of these programmes, eParticipation Preparatory Action, has been the object of a systematic evaluation. Projects funded: 20. Average project cost: 715,000 euro. Average number of participants: 450. Average number of user generated contributions (posts or petition signatures): 1,300. Average cost of one post or signature: 550 euro.

The eparticipation research community has managed to ignore these figures. The evaluation studies of the Preparatory Action’s projects are “unanimously positive”. Despite the Commission’s request of a rigorous cost-benefit analysis none of these studies quotes the 550 euro figure. And the Commission itself has decided, although with some corrections, to go ahead: the main difference between this first batch of projects and the next (projects approved for funding in 2009 and 2010) is, according to the paper, their budget, that increased to an average 2.8 million euro. How could the research community overlook these data? According to the author

Handling this kind of “elephant in the living room”-issues is always problematic, as their very existence tends to be denied because of their complexity or the embarrassment they cause and, as a result, they cannot be acknowledged or discussed, let alone get properly sorted out.

Prieto-Martin thinks that the reason for the not-so-great performance of e-participation projects is essentially this: in line with the tradition of European innovation policy, they have been deployed according to a “push” logic. This means incentivizing technology producers to push innovation out to more or less acquiescent users, in the form best suited to the producers’ interests. And the producers did respond with enthusiasm: unfortunately – partly because of the relative lavishness of the funding – they were in general the wrong applicants. Not the best and the most innovative, but the “usual suspects”: organizations that navigate confidently the bureaucratic requirements of European funded research. These requirements are designed to guarantee bang for taxpayers buck and an impartial allocation of resources, but – as CriticalCity’s Augusto Pirovano explains in this short video – ended up excluding from the game small businesses and civil society organizations, the true innovators.

Prieto-Martin is very critical of the situation, and rightly so. On the other hand I am not convinced it is fair to blame the European Commission for the fiasco. It is a Weberian bureaucracy: its discretional power is limited by design. As I have written before all bureaucracies have trouble relating to networked communities: the latter are made of people and find their meaning in the web of diverse person-to-person relationships, whereas Weberian bureaucracies act on the basis of rational, standardized rules applied to all. I still find convincing what I wrote on that occasion:

I see only one way: a new deal between government and the women and men who work for it. Such a new deal would work like this: administrations have to give trust and breathing space to their servants; and then assess their results, rewarding people who get results and punishing people who don’t. If there are abuses of that trust, they will be dealt with on a case-by-case basis: designing an entire system to prevent abuse is at a high risk to making it too rigid, disabling people to offer their best ideas.

I am no lawyer, but I expect Weberian bureaucracies to be prevented by design to reform themselves in the way outlined. Some kind of external legal provision will be necessary for this to happen. Until then, I guess, we’ll have to cope with a certain number of elephants camping out in the living room.

Sorry, this post in Italian only. It is a call to arms for a collaborative translation into Italian of the Open Knowledge Foundation’s Open Data Manual. The rationale is that many Italian public authorities seem to be sincerely considering opening up their data, but they find taking the first step quite intimidating – lots of jargon to cut through. If you know enough Italian to help, read on!

È un buon momento per gli open data in Italia. Diverse amministrazioni mi sembrano considerare con sincero interesse l’idea di aprire i propri dati, nell’interesse della trasparenza e della collaborazione. Fare il primo passo, però, richiede il superamento di una certa timidezza iniziale. Lo capisco bene: ci sono scogli giuridici da evitare, un’infarinatura di know-how tecnico da acquisire, e la tentazione del “chi me lo fa fare” è sempre in agguato. In più, molta letteratura rilevante è in inglese.

E così, nella mitica mailing list di Spaghetti Open Data a un certo punto è nata l’idea di tradurre in italiano l’Open Data Manual della Open Knowledge Foundation, che è un documento ben organizzato, scritto per persone che non sanno nulla di open data. Come per tutte le cose veramente sentite, non è chiaro chi abbia avuto l’idea: qualcuno ha dato la colpa a me, ma io sono sicuro di non avere proposto nulla del genere (può essere che abbia detto “sarebbe bello”). Comunque sia, un paio d’ore dopo quelli della OKF avevano caricato il Manuale sul web per la traduzione.

È un venerdì di agosto. Proporre ora un’esperienza collaborativa (tra l’altro impegnativa come una traduzione) va contro ogni regola della comunicazione web. Ma va bene così: è un’operazione che si è montata praticamente da sola, e questo in genere è un buon segnale. In effetti, al momento in cui scrivo abbiamo già tradotto il 15% del manuale! Per il rimanente 85, tutti i lettori di Contrordine Compagni sono invitati ad arruolarsi. Va benissimo anche tradurre solo una o due frasi. Istruzioni:

1. andate qui e registratevi.
2. andate qui. Cliccate sul link “Open Data Manual → all.pot” e poi su “Translate now”.

Io sto facendo la mia parte e sono qui.