Posts Tagged ‘Economics’

Number of subway passengers from Powell Station = retail revenues?

Thursday, April 8th, 2010

Spinn via Flickr/Creative Commons License Attribution

The Wall Street Journal reports that economists are looking to “oddball data” to see trends before official numbers are released.

We’re obviously a little obsessed with data reuse — the more imaginative, the better. There’s Ted Egan, the chief economist in the San Francisco Comptroller’s office, who looks at weekend passenger tallies for the Union Square shopping district rather than wait six months for the state’s official retail revenue numbers.  Then there’s Edward Learner, the economist who discovered diesel fuel sales on Interstate Highway 5 is a leading indicator of construction employment in California, while diesel sales on Interstate Highway 80 is an indicator of manufacturing employment.

The people who collected this data surely didn’t imagine it being used this way, which is why we should be really careful about closing off data reuse before we even know what the potential reuses are.  And, as these economists have found, these indicators are often faster and arguably, more accurate.

(P.S.  I used to live in San Francisco.  I know the Powell St. trolley is not the same as the Powell BART station.  Sorry.)

A nonprofit wants to share its mailing list with some economists–would that bother you?

Thursday, March 13th, 2008

There’s a fascinating article in the New York Times Sunday Magazine on an economists’ study of what makes people donate by an interesting liberal-conservative pair, Dean Karlan and John List. They wanted to do an empirical study of fundraising strategies, to find out what kind of solicitations are the most successful. As the article points out, lab experiments of economic choices aren’t particularly realistic: “If you put a college sophomore in a room, gave her $20 to spend and presented her with a series of pitches from hypothetical charities, she might behave very differently than when sitting on her sofa sorting through letters from actual organizations.”

So Karlan and List found an opportunity for a field experiment, a partnership with an actual, unnamed nonprofit that allowed them to try different solicitation strategies and map the outcomes. They wrote solicitation letters that were similar, except some didn’t mention a matching gift, some mentioned a 1-to-1 match, some a 2-to-1, and some a 3-to-1. In the end, if a matching gift was mentioned, it increased the likelihood of a donation, but the size of the matching gift did not. As the author, David Leonhardt, notes, their findings and the findings of other economists in this area are significant to many people, from the nonprofits trying to be better fundraisers to economists studying human behavior, even to those who want to make tax policy more effective and efficient.

The article, however, didn’t mention whether the donors to the nonprofit had consented to their responses being shared with anyone other than the nonprofit. I’m not that concerned about whether donors’ privacy may have been egregiously violated. (I’m also not sure what’s required of nonprofits in this area.) I’m just curious to know, if they had been given the choice, would they have agreed to their information being shared with the economists? Obviously, the study wouldn’t have worked if potential donors had been told they would be sent different solicitation letters to measure their responses, but I think if most people on a nonprofit’s mailing list were asked if they would explicitly allow their information to be used in academic studies, they would consent. They might want assurances that their individual identities would be protected—that no one would know Mr. So-And-So had given zero dollars to a cause he publicly champions. But they might very well be willing to help the nonprofit figure out how to be more effective and be a part of an academic study that could shape public policy. They might even be curious to know how their giving measures compares to other donors in their income brackets or geographic areas.

Most people, myself included, have a knee-jerk antipathy to having their personal information shared with anybody other than the organization or company they give it to. But maybe we would feel differently if we were actually given some choices, if our personal identities could be protected, if sharing information could lead to more than just targeted advertising or more junk mail.

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