Author Archives: legallysociable

What a McMansion looks like to an insurer

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I find McMansions to be fascinating but rarely have I thought how an insurer might view a Large Tract Home (LTH):

While they might look grand, LTHs are different from high value homes in a few key ways. Their location and design is similar across an entire subdivision, the construction materials are lower in quality, LTH construction practices are focused on efficiency, and other LTH construction costs are more predictable and less expensive. Despite those differences, insurers can run into problems when assessing the reconstruction bill for an LTH.

“A lot of times, the sheer size of them [means] a lot of carriers classify them with a much higher reconstruction cost when it comes time to rebuild,” said Benjamin Abbott, product manager for CoreLogic Insurance Solutions group, adding that the latest RCT Express release “allows carriers to visually see whether a home is classified as a large tract home or not. And if it is, then we turn down the reconstruction costs a little bit with our assumptions and allow the tool to more accurately price [the property].”

The valuation distinctions between McMansions and high value properties becomes important as natural catastrophes bear down on many parts of the US, at the same time as a lot of new homes are being built in the LTH model…

“It’s important for the insurance carriers to accurately value the reconstruction costs of any property they have because their client, the homeowner, is going to see the impact of that reconstruction cost directly in the premiums that they pay,” Abbott told Insurance Business. “Prior to this update and with other tools out there, they are potentially over-insuring, meaning that premiums may be inflated, which hurts the homeowners directly.”

Interesting assessment: the size of McMansions would lead to a higher reconstruction cost until the insurer considers the quality of the construction and the reconstruction cost drops. I assume this then means it could be cheaper to insure a McMansion than a different kind of home of a similar size?

More broadly, I wonder if insurance companies could provide data on McMansions:

  1. Just how many McMansions/Large Tract Homes are there in the United States?
  2. What is the worth of all such homes?
  3. How many and/or what percent of McMansions are located in areas more prone to natural catastrophes (such as coastal areas where beachfront McMansions can be popular)?
  4. Because of the lower-quality construction of McMansions (as noted above), do McMansions have an above average number of claims on the home insurance over time? The lower-quality construction claim is a common one but we have not necessarily had enough years pass before we can easily see more issues with the longevity of McMansions.

Open office arrangements may not work for getting work done

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An evaluation of the implosion of The We Company highlights the importance of physical space for accomplishing tasks in the workplace:

Much will be written in the coming weeks about how WeWork failed investors and employees. But I want to spotlight another constituency. WeWork’s fundamental business idea — to cram as many people as possible into swank, high-dollar office space, and then shower them with snacks and foosball-type perks so they overlook the distraction-carnival of their desks — fails office workers, too.

The model fails you even if you don’t work at a WeWork, because WeWork’s underlying idea has been an inspiration for a range of workplaces, possibly even your own. As urban rents crept up and the economy reached full employment over the last decade, American offices got more and more stuffed. On average, workers now get about 194 square feet of office space per person, down about 8 percent since 2009, according to a report by the real estate firm Cushman & Wakefield. WeWork has been accelerating the trend. At its newest offices, the company can more than double the density of most other offices, giving each worker less than 50 square feet of space…

But after chatting with colleagues, I realized it’s not just me, and not just the Times: Modern offices aren’t designed for deep work…

The scourge of open offices is not a new subject for ranting. Open offices were sold to workers as a boon to collaboration — liberated from barriers, stuffed in like sardines, people would chat more and, supposedly, come up with lots of brilliant new ideas. Yet study after study has shown open offices to foster seclusion more than innovation; in order to combat noise, the loss of privacy and the sense of being watched, people in an open office put on headphones, talk less, and feel terrible.

This moment might just a tipping point in the evolution of office space. Cubed suggests office layouts do change over time. What seems to be next is a mixing of older models and the open model: different spaces that range from very private (think soundproof booths or offices away from activity, sound, and eyes) to very open (think couches and play areas for activity). How exactly the imperative to save money or be efficient remains to be seen.

Hinted at in this opinion piece is another interesting idea: could truly private spaces only be available to certain classes of workers or certain people? The office has long been symbol of more power and/or responsibility. Imagine a workforce or a public where the majority of people operate in common spaces that are semi-private, with privacy usually obtained though the actions of individuals (headphones, focus on screens, etc.). In contrast, those with power and resources have access to distraction-free spaces.

Another big issue could be this: how much work these days is truly distraction-free and are we moving toward less deep work? Again, this might different by field or role. But, the rise of smartphones and the Internet means people are highly distractable from work, even in very private settings. American adults on average are consuming 11 hours of media a day, some of this which must happen at work for many.

The retraction of a study provides a reminder of the importance of levels of measurement

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Early in Statistics courses, students learn about different ways that variables can be measured. This is often broken down into three categories: nominal variables (unordered, unranked), ordinal variables (ranked but with varied category widths), and interval-ratio (ranked and with consistent spaces between categories). Decisions about how to measure variables can have significant influence on what can be done with the data later. For example, here is a study that received a lot of attention when published but the researchers miscoded a nominal variable:

In 2015, a paper by Jean Decety and co-authors reported that children who were brought up religiously were less generous. The paper received a great deal of attention, and was covered by over 80 media outlets including The Economist, the Boston Globe, the Los Angeles Times, and Scientific American. As it turned out, however, the paper by Decety was wrong. Another scholar, Azim Shariff, a leading expert on religion and pro-social behavior, was surprised by the results, as his own research and meta-analysis (combining evidence across studies from many authors) indicated that religious participation, in most settings, increased generosity. Shariff requested the data to try to understand more clearly what might explain the discrepancy.

To Decety’s credit, he released the data. And upon re-analysis, Shariff discovered that the results were due to a coding error. The data had been collected across numerous countries, e.g. United States, Canada, Turkey, etc. and the country information had been coded as “1, 2, 3…” Although Decety’s paper had reported that they had controlled for country, they had accidentally not controlled for each country, but just treated it as a single continuous variable so that, for example “Canada” (coded as 2) was twice the “United States” (coded as 1). Regardless of what one might think about the relative merits and rankings of countries, this is obviously not the right way to analyze data. When it was correctly analyzed, using separate indicators for each country, Decety’s “findings” disappeared. Shariff’s re-analysis and correction was published in the same journal, Current Biology, in 2016. The media, however, did not follow along. While it covered extensively the initial incorrect results, only four media outlets picked up the correction.

In fact, Decety’s paper has continued to be cited in media articles on religion. Just last month two such articles appeared (one on Buzzworthy and one on TruthTheory) citing Decety’s paper that religious children were less generous. The paper’s influence seems to continue even after it has been shown to be wrong.

Last month, however, the journal, Current Biology, at last formally retracted the paper. If one looks for the paper on the journal’s website, it gives notice of the retraction by the authors. Correction mechanisms in science can sometimes work slowly, but they did, in the end, seem to be effective here. More work still needs to be done as to how this might translate into corrections in media reporting as well: The two articles above were both published after the formal retraction of the paper.

To reiterate, the researcher treated country – a nominal variable in this case since the countries were not ranked or ordered in any particular way – incorrectly which then threw off the overall results. When then using country correctly – from the description above, it sounds like using country as a dummy variable coded 1 and 0 – the findings that received all the attention disappeared.

The other issue at play here is whether corrections to academic studies or retractions are treated as such. It is hard to notify readers that a previously published study had flaws and the results have changed.

All that to say, paying attention to level of measurement earlier in the process helps avoid problems down the road.

Houses and locations from TV shows can draw visitors

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To follow up on yesterday’s post regarding the importance of the English manor to Downton Abbey, some more on the popularity of the home:

When the Downton Abbey producers first approached Highclere in 2009, the family faced a near £12m repair bill, with urgent work priced at £1.8m. But by 2012 the Downton effect had begun to take the pressure off. Lord Carnarvon said then: “It was just after the banking crisis and it was gloom in all directions. We had been doing corporate functions, but it all became pretty sparse after that. Then Downton came along and it became a major tourist attraction.”

Visitor numbers doubled, to 1,200 a day, as Downton Abbey, scripted by Julian Fellowes, came to be screened around the world after becoming a hit in the UK in 2010 and then in the US. It is now broadcast in 250 countries…

VisitBritain’s director, Patricia Yates, said: “The links between tourism, films and TV are potent ones.” She added that period dramas have also raised the popularity of regions outside of London.

Keeping an older house maintained and running is an expensive task. Tourism spurred by television or film can help some locations stay afloat even as dozens of other homes languish. More broadly, when I studied the primary home on The Sopranos, I ran into stories of Sopranos tours and merchandise that utilized the show’s New Jersey locations. A Simpsons home outside Las Vegas has attracted visitors even as the home has remained as a private residence. Fixer Upper helped bring people to Waco, Texas. Some shows do indeed seem to spur tourism.

On the other hand, visiting the locations and homes of other shows would prove disappointing. Many television homes, such as the residence of the Brady family on The Brady Bunch, do not match the actual home even if the exterior is recognizable. Numerous shows use establishing shots of real locations and then the filming takes place on soundstages and backlots. For example, a tour of New York City based on Friends makes little sense since most of the action took place inside fictional locations (though the 25th anniversary pop-up location in New York City is sure to attract visitors). On a tour of the Warner Brothers backlot, I saw Wisteria Lane and part of Stars Hollow; in both cases, knowing that this was not a real place changed how I later perceived the shows.

In a world where cities and places chase tourists, television shows that use that location and become popular can be a boon because there is little a community has to do with it. What exactly those tourists expect to get – perhaps a little closer to the on-screen characters? to drink in the mystique of the entertainment industry? – is another matter entirely.

Argument: the star of Downton Abbey is the house

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All television shows have settings and locations but few are as important as the large home on Downton Abbey:

The main character in Downton Abbey is not a person at all. It’s a building. Downton Abbey.

There it is in the opening credits of the new film and, despite a whole raft of new changes that I am trying not to give away, there it stands at the end, towering over all of the humans who enter and exit its doors, more custodians than owners, really.
The domestic edifice is this hugely successful franchise’s reason for being, the explanation for the movie, the lodestar for the show’s fans. Individual characters can die — and, God knows, they have. But if “Downtown Abbey” itself were ever to fall, then the story would be over.

This is unusual. Most long-running TV shows are centered on either an individual or a family. “Mad Men” could not survive past the death of Don Draper. “Dexter” needed Dexter. “Breaking Bad” tells the story of Walter White. “Game of Thrones” (73 episodes!) had numerous story arcs, heaven knows, but it still remained the story of communities, not unlike “The Wire” or “The Deuce.” “Star Wars” is a generational saga at its core. And, of course, superhero franchises need their superheroes. (Or their close relations.)

In many television shows, the setting functions more as a backdrop than anything else. The opening credits may show a city and/or home. The show itself may feature a few main sets, typically a place of residence and a workplace. But, swap one city or suburb for another or home for another home and the show could go on.

Would the same be true for Downton Abbey? If the show took place in a different English manor – which are occasionally seen on the show and in the movie – would it be a different show or a weaker show? Is the show popular because of the house or is the house popular because of the show?

It seems like a step too far to suggest that a bad or mediocre television show could be rescued by or solely built on a unique and interesting setting. Good characters encountering interesting situations is a necessary ingredient, even in a show that depends on an unusual and/or popular location. Yet, we could study the degree to which a setting or location or building figures in the plot and popularity of a show. For example, would The Sopranos be the same show without the suburban McMansion the family lives in?

Slight drop in millennial population in American big cities

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The population of big cities may depend on millennials: will they flock to urban locations or leave for the suburbs? New data suggests slightly more of them are headed out of cities:

Cities with more than a half million people collectively lost almost 27,000 residents age 25 to 39 in 2018, according to a Wall Street Journal analysis of the figures. It was the fourth consecutive year that big cities saw this population of young adults shrink. New York, Chicago, Houston, San Francisco, Las Vegas, Washington and Portland, Ore., were among those that lost large numbers of residents in this age group…

The 2018 drop was driven by a fall in the number of urban residents between 35 and 39 years old. While the number of adults younger than that rose in big cities, those gains have tapered off in recent years.

Separate Census figures show the majority of people in these age groups who leave cities move to nearby suburbs or the suburbs of other metro areas.

City officials say that high housing costs and poor schools are main reasons that people are leaving. Although millennials—the cohort born between 1981 and 1996—are marrying and having children at lower rates than previous generations, those who do are following in their footsteps and often settling down in suburbs.

MillennialsCities2019Data

An interesting update: millennials as a whole are leaving cities but younger millennials are still going to cities while the oldest ones are leaving. Does this mean that the argument that young urbanites will still leave for the suburbs when they form families and have kids?

Maybe, maybe not. It would be helpful to know more:

1. How does the older millennial move out of cities compare to previous generations? Are they leaving cities at similar rates or not?

2. Is there significant variation (a) within cities over 500,000 people and (b) within smaller big cities (of which there are many)? The first point could get at some patterns related to housing prices. The second could get at a broader picture of urban patterns by not focusing just on the largest cities.

3. The true numbers to know (which are unknowable right now): what will the numbers be in the future? The chart above suggests some shifts even in the last decade. Which pattern will win out over time (or will the numbers be relatively flat, which they are for a number of the years discussed above)?

The nuanced reasons for population loss in Illinois

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With the problems facing the state of Illinois, how many people are actually leaving?

In 2018, the state had an estimated net migration loss of 6.5 people for every 1,000 residents, according to the most recent census data. Five years earlier, the net loss was about 3 people per 1,000 residents.

The latest number puts Illinois 49th out of the nation’s 50 states on net migration loss. Only Alaska had a worse rate, with a loss of 11 people per 1,000 residents…

Population decline is also happening in more parts of the state. From 1990 to 2000, 68 of Illinois’ 102 counties gained population. But so far this decade, only nine counties, including Kane, Will and DuPage in the Chicago area, have added residents…

In 2017, Indiana drew nearly 9% of the Illinois residents who moved out of state. Florida, California, Wisconsin and Texas were among the top destinations as well…

But the city’s black population has shrunk much more. Over the same time period, Chicago had a loss of about 35,600 black residents. Meanwhile, the number of white, Asian and Latino residents all grew…

But the biggest reasons people usually give for moving, Percheski said, are jobs (or shorter commutes), schools and to be closer to family. People also seek out available housing that fits their needs, she said, whether that is more space for a growing family, a smaller place because children are grown, or a more affordable option.

This is a well-done article: lots of good data with helpful commentary from experts. There is not an easy headline here but a full read leads a more complete understanding of the issues. A reader should go away from this thinking population loss is a multi-faceted issue that is more nuanced than “high property taxes mean people are leaving Illinois.” One piece that is missing: in an earlier post, I noted that there are also many reasons for people to stay in the Chicago region (including inertia).

This also means there are multiple ways to address the issue. Just from the numbers I pulled out above: is it about net migration loss or attracting more new residents? How could prospects be improved in most of the state’s counties? What do other states offer that Illinois does not? What might lead black residents to stay? Is this primarily about good jobs and available housing? Tackling all of these at once would be difficult. For example, simply adding jobs does not necessarily mean that they are located in places that many people can access, that those jobs can support a household or family, that housing is available nearby, or that such jobs are more attractive than jobs elsewhere. Yet, some targeted efforts at a few of these trends could help slow or reverse them.

Of course, this all comes amidst trends of population loss in Chicago and within a larger backdrop that American communities believe population growth is good. The reasons behind the population decline may be complex but this nuance may matter little if the trend continues.

 

Adaptations in nature to urban life

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More research shows animals can and do adapt to urban environments:

Whitehead’s work on killifish is one of the signature triumphs of urban evolution, an emergent discipline devoted to figuring out why certain animals, plants, and microbes survive or even flourish no matter how much we transform their habitats. Humans rarely give much thought to the creatures that flit or crawl or skitter about our apartment blocks and strip malls, in part because we tend to dismiss them as either ordinary or less than fully wild. But we should instead marvel at how these organisms have managed to keep pace with our relentless drive to build and cluster in cities. Rather than wilt away as Homo sapiens have spread forth bearing concrete, bitumen, and steel, a select number of species have developed elegant adaptations to cope with the peculiarities of urban life: more rigid cellular membranes that may ward off heat, digestive systems that can absorb sugary garbage, altered limbs and torsos that enhance agility atop asphalt or in runoff-fattened streams.

Whitehead and his colleagues, many of whom are at the dawn of their careers, are now beginning to pinpoint the subtle genetic changes that underlie these novel traits. Their sleuthing promises to solve a conundrum that has vexed biologists for 160 years, and in the process reveal how we might be able to manipulate evolution to make the world’s cities—projected to be home to two-thirds of humanity by 2050—resilient enough to endure the catastrophes that are coming their way…

Like so many of their scientific peers, urban evolution researchers are grappling with the question of how their work can help us make this new environmental reality a bit less grim. On the surface, at least, their inquiries can seem largely aimed at addressing theoretical matters—notably the issue of whether the evolution of complex organisms is a replicable phenomenon, like any ordinary chemical reaction. Cities provide an accidental global network of ad hoc laboratories to test this question: Office towers the world over are fabricated from the same glass panels and steel beams, night skies are illuminated by the same artificial lights, auditory landscapes thrum with the noise of the same cars, food waste comes from the same KFCs and Subways.

This urban sameness is allowing researchers to determine whether isolated populations of the same species develop similar adaptations when placed in parallel environments. “What cities offer us is this amazingly large-scale, worldwide experiment in evolution, where you’ve got thousands of life-forms that are experiencing the same factors,” says Marc Johnson, who heads an evolutionary ecology lab at the University of Toronto Mississauga.

Perhaps sociologist Robert Park was more correct than he knew by suggesting the city was a laboratory. Furthermore, Park and other sociologists like Herbert Spencer borrowed concepts from biology and applied them to social processes and communities.

This research could also help address two other issues (in addition to climate change as discussed in the article):

  1. What really is “nature” in cities? Adding parks and trees is not really grappling with what nature is nor with how cities and their residents see nature around them. And what is the ideal end goal of people-nature interaction in big cities?
  2. Urbanization is not just about harm to the environment but it is also about long-term changes. Humans have been interacting with and affecting nature for a long time but the specific process of urbanization in roughly the last 150 years has been different.

Trump administration pushes housing deregulation

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A look at the Trump administration’s approach to homelessness includes this summary of how they view housing more broadly:

Housing deregulation is probably the core of the report outlined by the Council Advisors. That lines up with the Trump administration’s overall position on housing—from Carson’s enthusiasm for breaking up exclusionary zoning to the housing plan that the Domestic Policy Council is drafting. Trump signed an executive order establishing a White House Council on Eliminating Regulatory Barriers to Affordable Housing in June.

While making it easier to build housing could ease the affordability crisis, it may be hard to achieve those reforms, Hanratty says. Several of the Democratic Party primary candidates have outlined housing plans with various strategies to promote new construction, but all of them would require sweeping new legislation. And in practice, deregulation might not produce housing that is affordable to very low-income families or people with substance-abuse or mental-health afflictions without subsidies.

This is a common conservative argument to make these days: the housing market needs to be a more free one with less interference from local governments as well as the federal government. Attempts at more explicit intervention – such as in public housing – have not proved popular. If the law of supply and demand could simply take over, the market would provide housing options for all.

However, this may not work as intended. The suburbs, a space seen as desirable by many Americans was not the result of free markets but rather the result of all sorts of social and government interventions. Would Houston’s growth without zoning look attractive for communities around the country? Without any regulations, developers and builders may have little incentive to build cheaper housing and instead pursue units that provide more profit.

Finding some middle ground where specific and limited interventions actually lead to more affordable housing will prove difficult. Without some negative consequences for communities and housing market actors who do not participate in providing cheaper housing, what can be done?

Sociology experiment shows how parties can flip positions

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Cass Sunstein describes a sociology study that could help explain how attachment to a political party can lead to divergent political positions:

Here’s how the experiment worked. All participants (consisting of thousands of people) were initially asked whether they identified with Republicans or Democrats. They were then divided into 10 groups. In two of them, participants were asked what they thought about 20 separate issues — without seeing the views of either political party on those issues. This was the “independence condition.” In the eight other groups, participants could see whether Republicans or Democrats were more likely to agree with a position. This was the “influence condition.”

In the influence condition, each participant was asked his own view, which was used to update the relative level of support of each party. That updated level was displayed, in turn, to the next participant in the same group.

The authors carefully selected issues on which people would not be likely to begin with strong convictions along party lines. For example: “Companies should be taxed in the countries where they are headquartered rather than in the countries where their revenues are generated.” And, “The exchange of cryptocurrencies (such as Bitcoin, Ethereum, or Litecoin) should be banned in the United States.” Or this: “Artificial intelligence software should be used to detect online blackmailing on email systems.”

The authors hypothesized that in the influence condition, it would be especially hard to predict where Republicans and Democrats would end up. If the early Republican participants in one group ended up endorsing a position, other Republicans would be more likely to endorse it as well — and Democrats would be more likely to reject it. But if the early Republicans rejected it, other Republicans would reject it as well — and Democrats would endorse it.

And the findings:

Across groups, Democrats and Republicans often flipped positions, depending on what the early voters did. On most of the 20 issues, Democrats supported a position in at least one group but rejected it in at least one other, and the same was true of Republicans. As the researchers put it, “Chance variation in a small number of early movers” can have major effects in tipping large populations — and in getting both Republicans and Democrats to embrace a cluster of views that actually have nothing to do with each other.

This seems like a good reminder regarding humans: attachments to groups are very important. When faced with taking in information, what the groups we identify with matters. This is the case even in an age where we would claim to be individuals.

Studying social change more broadly is a difficult task. It is perhaps easiest to see large-scale change after it has already happened and observers can look back and pick out a path by which society changed. It can be quite hard to see social change as it is occurring when it is unclear what exactly is happening or in which direction a trend line will go. It can also be difficult to see changes that did not take off or trends that did not go very far.