Beef with black bean sauce

This was originally a guest post of mine on Meltem Daysal’s blog. Before we get started we put on some rice.

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Here you see our rice cooker, but of course a pot on the stove will do as well. Pandan rice is nice for this dish. Make sure you wash the rice, then put it into the rice cooker and or the pot and boil it. If you use a stove make sure you use enough water, then bring it to the boil, let it boil for a bit and then don’t open the lid but let it stand for 15 or so minutes.

I’m a big fan of exploring traditional dishes and really trying to get to the idea of the dish. The most important ingredient for our dish today are black beans. You can get them in any Asia store.

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These are actually fermented and salted soy beans called Douchi (豆豉). It’s apparently the oldest known food made from soy beans. They have a salty taste that reminds me a bit of bacon, so no wonder steamed salmon with black bean sauce is so tasty. Soak them in not too much warm water. If you have time, then it’s a good idea to do this some 10 or so minutes before you start cooking.

Today we’re going to do a stir fry. Asian dishes don’t use a whole lot of meat. For two persons a nice steak will do here. Slice it thinly against the grain.

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I really like to use a super sharp knife, it’s just so much fun to cut with it. Then we put some regular oil into a pan, ours is not too big and looks a bit like a wok, and fry the meat. I put my stove on the highest temperature. Unless the meat is of super high quality some water will come out, wait until it’s gone and the meat is a bit brown, but don’t leave it in there too long. Otherwise you kill the taste. This took about two to four minutes. While we handle the pan to turn the meat we cut some pepper, garlic and ginger.

Next put in the garlic, ginger and pepper. Add the soaked black beans and some of the liquid. Next, we add some soy sauce, something like four tablespoons, and a bit less rice wine. Make sure you don’t use Japanese soy sauce. I took the light Chinese one. You can get it, together with the rice wine, in any Asia store. Finally, add some sugar and a bit of cornstarch.

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The latter will make the sauce some thicker, which is a nice texture for this dish. That’s by the way something interesting I didn’t realize for a long time. A lot of the taste is about texture anyways. Leave it on the stove until the sauce thickens. The beans will dissolve and everything will become a creamy, tasty, salty sauce, with a nice tone of ginger and garlic.

I put everything into a bowl and that’s it—enjoy!

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How to write good code

Many people never systematically learn how to write good computer code. But many also know that their code could be better. After all, this would make it easier to debug it, or to go back to it after some time, when one has to run that additional analysis for this revision of the paper. And therefore it will save a lot of time at some point.

This is to say that it’s really a good investment to learn how to code well and to organize one’s coding a bit more professionally. My advice therefore is to develop your skills as early as possible. A very good starting point is the Pactitioner’s Guide by Matthew Gentzkow and Jesse Shapiro.

Two points they make strike me as particularly interesting. First, it is desirable that one can fully replicate the results in a paper, from the raw data to the final table with the results. If one makes this a general principle, then one will automatically write better code. Second, the process by which code is changed should be fully documented and it should be possible to selectively un-do some changes. Think of it as a more professional version of “track changes” in word. It actually exists: it’s called versioning software and it works great. Professional programmers use it, and for bigger projects there is really no reason why one should do so as well. Many institutions have a server on which versioning software is running (we have a SVN server here in Tilburg, just email ICT), but you can even run it on your own server (or NAS at home, like a Synology DIskstation), or only on your standalone PC.

Starting to work on a Ph.D. thesis

I would also like to use this Blog to share some advice to Ph.D. students. Let’s start with advice for Ph.D. students who have just completed the first two years of courses (small aside: In some European countries, the first two years of a Ph.D. program are referred to as the “Research Master” or “MPhil” Phase and after that one starts in year one; in the U.S. and other countries, one would call this year three).

So, it’s August now and you are about to get started with the thesis phase. I would suggest that you first think about where you want to be by the end of the Ph.D. Of course, you want to have a degree, but you also want to have a job. And the idea of a Ph.D. program is to prepare you for a job as an academic. For that reason, I find it helpful to already now read Cawley’s guide on the academic job market, available at the AEA job market website. There, you will also find other interesting papers that look at this question from a different angle.

The most important thing to realize is that when you want to have a job on September 1, then you need a single-authored job market paper in November of the previous year.

Next, I suggest you do some more preparatory reading that is related to the actual activity of doing research. I personally liked the book “How to write a lot“, because it does not only help you to overcome the writer’s block, but also gives you advice on how to organize your day so that you are as productive as possible. I’ve also heard good things about the book “Writing your dissertation in 15 minutes a day“.

It’s also time to acquire some software skills. I suggest to look into LyX for text processing, programs to organize your bibliography files (such as JabRef) and to have a look at R, as more and more people seem to use it, especially when they deal with big data sets. Moreover, get your IT environment in good shape. Buy a tablet, install all necessary apps on it (most importantly a PDF reader with annotation function, such as Goodreader). And come up with a good file structure on your hard disk so that you find things. I personally have everything in my Dropbox. This makes it easy to share folders and to synchronize files between your devices. And you automatically back up your files. You can also use any other such service, such as the SURFdrive here at Tilburg University.

Generally, get everything out of the way so that you can get started. All this can be done in one week. Or even less time.

Next, start thinking about research ideas. An idea is a question you would like to answer and that you think one can answer (it doesn’t matter if you don’t know how exactly). Most research ideas won’t work out, but some of them will. Compose a list of your 10 best ideas. Then, take the most promising one and ask yourself how the ideal data set would look like with which you could answer the question. Think about the ideal natural experiment you would like to exploit. And do a google (scholar) search on the topic. Don’t be disappointed if somebody else has already (tried to) answer the question. Instead, ask yourself whether you think it’s possible to give a much better answer.

Actually, you should actually start thinking about ideas already in the second year, before picking an adviser and starting the thesis phase. From then onward, think about new ideas all the time. Discuss them with your classmates and also with faculty. More junior faculty are usually very approachable, while the senior ones are more busy. But you should also talk to the more senior ones about your work. Try to make an appointment if necessary. This could be part of the process of looking for a good match for your adviser(s). Refine your list by getting rid of the less promising ideas and replacing them with more promising ones. This list will be helpful when somebody asks you the important question “What are you working on?”. And many people will ask that question.

Talking to others about will probably lead to a joint project at some point. Sometimes, it is very helpful to start a research project with a junior faculty member, preferably if he or she will likely be on your dissertation committee or your advisor. This will foster learning by doing, which will help you for your future projects. At the beginning you will think that you have a lot of stupid questions and make a lot of stupid mistakes. But you will learn that this is just part of the thought process that (sometimes) leads to insights that are all but stupid. And this is what counts.

But will all this, keep in mind that your most important goal is to have a single-authored job market paper at the end of your dissertation phase. Start talking to your advisor about this already after a few months.

Join a group such as the structural econometrics group in Tilburg. Here, ideas are discussed almost every week. Check the seminar schedules and make a plan which seminars to attend in the upcoming semester.

Start reading. In general. Make it a habit to browse through the recent issues of the top 5 journals. Learn how great work looks like. Learn how to get the main idea of a paper without spending days reading it.

Also read the original versions of the classic articles. For example, Arrow’s classic piece on health economics. Or McFadden’s classic articles on travel demand (he has a very nice website with lots of linked articles). This can be very inspiring because the original articles are often very clear and explicit, and in some sense easier to understand than more recent textbook treatments of the material. You can also browse through Train’s book, for an introduction on using simulation techniques to incorporate random-coefficients into your empirical model. Also find out about recent important developments, for example by reading Varian’s article on big data.

I assume that you already know which field you want to be working in, because you have made a conscious choice after having attended comprehensive field courses and you’re already paired up with an adviser. If you still have the feeling that you are not so sure what the current topics are that are being discussed in the field, then go back to the overview articles you have been referred to in the field courses. For empirical industrial organization, for instance, I would suggest you read the article by Ackerberg, Benkard, Berry and Pakes, among others of course.

This brings me back to Cawley’s article. Go talk to your supervisor about the plan for the next months, ask him which chapters or articles you should read, and start thinking about multiple projects at the same time. But only work on one or two in the beginning. Nevertheless, keep in mind that you should update the list with the 10 research ideas. One of them will be your job market paper, but it’ll be a while until you know which ones.

Let the journey begin!

Recommended reading

I bumped into a nice blog by Kevin Bryan, a PhD student at Kellogg/Northwestern when I looked at the website of my colleague Sebastian Ebert. Recommended to those who are interested in reading about academic research. What I like is that Bryan makes a selection and discusses the respective contributions, so it’s not like subscribing to yet another newsletter from journal XYZ. And of course things make even more sense when they are put into perspective.

The effects of more transparency on the behavior of doctors, and sellers on eBay

A recent piece by The Economist suggests that medical doctors treat patients better when they in turn have the possibility to share their experiences online. This is exactly what my co-authors Christian Lambertz, Konrad Stahl and I find in a recent paper we have written on the effects of market transparency on eBay (we finished revising it last week). We argue and show that improving the design of the reputation mechanism on eBay allowed buyers to share negative experiences without the fear of retaliation, and therefore seller behavior improved. The design was improved by changing the main rating system. We compare seller behavior after that change to the one before. What we find particularly nice and what we exploit in our paper is that there was a second rating system in place in which buyers evaluated seller, and which was actually not changed at the same time.

(Lack of success) of Ph.D. graduates

Suppose you’re an economics department that wants to hire an assistant professor, and you have to decide between hiring the fifth out of 20 from one of the top 10 schools, or the top candidate from the top 11 school. A recent paper in the Journal of Economic Perspectives measures the research productivity of recent Ph.D. graduates. To summarize it in one sentence, the top candidate from a lower ranked school often does better than many of the ones who receive their Ph.D. from the best schools. Good to know when it comes to hiring I’d say. And encouraging when you’re a Ph.D. student who is not from one of the very best departments.

hello, world

Once in a while, I feel like sharing a thought. So let’s see whether blogs are for me. You will see that I’m passionate about economics, politics, travelling, food, friends, and technology.

We always discussed a lot about politics at home. In my teenager years I then discovered that reading the Frankfurter Allgemeine Zeitung, in my view the best newspaper in Germany, gave me a lot of pleasure, because discussions are more fun when you’re well informed, after all. I must have started by the age of 14 and haven’t stopped ever since.

My dad worked for Daimler-Benz at that time, so he often shared office stories. That’s why I was first also very much interested in the business side of things, and when it came to choosing a major for my undergrad studies I first thought about going for business administration. I didn’t have to choose until my second year of studies, but I soon realised that I found economics much more interesting than business administration.

Later, when I visited UC Berkeley’s Ph.D. program during the fourth year of my studies I discovered that for me conclusions are much more convincing if they are empirically founded, so I ventured more and more into empirical work. In the beginning, I was interested in the methods and in particular how one can model unobserved differences between individuals, which later led to some publications on treatment effects models and instrumental variables estimation, after I got my Ph.D. from the University of Mannheim.

During my time at Tilburg University, where I’m currently an associate professor, I then started to work on more and more serious empirical applications that combine methodological contributions and the aim of answering relevant real world questions. They deal increasingly with online markets and how they should be regulated, and how the design of platforms such as eBay can be improved (to some extent this means going back to the business side of things). Another big theme are health care markets and how adverse selection and moral hazard challenge their functioning. More about this later, for sure.

In this blog, I think a recurring theme will be that we actually know less than we often think we do, and that the only way to improve on this is some kind of empirical approach combined with interpretation of the evidence based on some sort of theory. I will probably also use it to talk about interesting papers or share some advice to graduate students. Some posts will be rather short and you can see them as some sort of diary of what I have been thinking about.

Let’s see where this all takes me.