Patterns in static

Painted lady beauty contest

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04 January 05.

People often ask me: Mr. BK of Baltimore, MD, what do you do when you're not pontificating and overintellectualizing? Well, lately, I've been tiling my kitchen floor.

It used to be crappy linoleum, and Ms. DH of Ann Arbor, MI had asked me if she could do something decent with it. She had done several small-scale mosaics in the past, and so had the experience with tile and the enthusiasm to do something better with my floor than linoleum. It turned out that this was a bit larger of a task than she had expected; most notably, she had not thought to lay the backer board which needs to go under the tile---not until we had already spent two days ripping up the linoleum. The floor now consists of the subfloor, the plywood on which the linoleum used to sit, a layer of cement, the backer board, another layer of cement, and then the tile. By the advice of a friend who is a professional in these matters, we didn't lay backer board in the bathroom, which gives the bathroom a centimeter or so drop from the hallway next to it. Further, we went with a mixed medium concept: a ceramic tile border, and then slate in the center. The ceramic is about 3 mm thick, and slate is about 6 mm.

What I'm getting at here is that it's very much a creative, multi-level experience. There's a border of blue tile, which spills into the bathroom (which is all blue), and collects in pools around the edges. Floating in the center of this is the island of slate, which is occasionally interrupted by small mosaics of mirror and tile, which have a sort of river theme.

Below are a few a photos of the kitchen and hallway, just before we placed the grout. The grout leaves a dolorous haze on everything, which I'm still trying to get off so it will be photogenic again.

Reactions to the new tile floor have been mixed. First, all but one person either agreed that it's better than the linoleum, most giving me a quizzical look in the way of `why would you ask me such a question; it's so obviously better'. [The one exception, Ms. RK of Silver Spring, MD, is famously negative.] Some thought the color scheme was a bit dark, and a number of people pointed out `it isn't level', which I take to mean `I don't know how I feel about your design decision to have a multi-level kitchen/bath/hall area'. Some thought the mosaics a bit fancy for a kitchen floor: `I'd expect to find this hanging on a wall, not on a kitchen floor.' I'm relieved to say that my roommate unequivocally likes what is now his kitchen floor.

The painted ladies I don't recall how much I'd told you about the house, dear reader, but maybe I should mention a few things. It's a Victorian-style townhouse, which the City of Baltimore tells me was built in 1900. The whole row was clearly all built at once, by a developer who bought three blocks of a street in Baltimore and worked its way down producing cheap houses. The townhouses are clearly much more sturdy than the average McMansion, but they were nonetheless mass produced and cheap---after all, they all share their side walls with their neighbors. I'm sometimes curious whether the rhetoric around these houses a hundred years ago was the same as the rhetoric people say now about mass-produced people storage solutions. Unfortunately, such information is pre-Internet, so I'll never know. In the present day, now that the house has sat in one place for a century, it's become quaint and valuable.

There's a painted lady contest on the street every year. A painted lady, the neighborhood newsletter defines, is a house whose facade is meticulously painted in three colors. I bring it up because most of the people around here like the look and think it raises the value of the house, while I think it just looks butt. The social norm is to paint right up to your property line, which means that if there is a little arch that crosses between the houses, exactly one half will be painted taupe and the other half will be painted purple.

Y'know, I'm failing to indicate what I'm pontificating about here, and I expect that I'll continue to do so for the rest of the essay, so let me just spell it out right here and leave your neurons to make the appropriate links. Everything here is about my favorite econ question, what I would call the fundamental question of economics: where does value come from?

Beauty contest So a few months ago, I'd written about the two beauty contests I'd run in class; I've run a third, and here are the results. On this one, I reported to the students the means and 2/3rd of the mean for the first and second runs. I'd used my Amazon associate account on the class website, and made $25 from selling textbooks to my students, and I made this the prize for this one, so it's not dumbass points but cold hard cash they were fighting for this time.

1st daymidtermfinal
2/3 mean173.0366.7244.53
% of ones3%25%10.3%

As a group, everybody moved forward exactly one step from where they'd been last time: the winning bid was two-thirds of last time's winning bid. The equilibrium is to bid one, and you can see that the class sort of backslid away from believing that everyone was going to play that. 18% of the bids were between five and twenty.

But back to the subject of me, there is the several thousand dollar question: will the tile floor raise the value of the house? This is the beauty contest all over again, since the question is not whether I think the floor looks nice, but whether I think other people think the floor looks nice. In fact, when potential buyers check out the house, they will all have in mind the resale value of the thing, meaning that I need to consider whether other people will think that other people will like the floor.

Ms. RK thought the linoleum worked better because the only safe strategy to selling a house is to make it as boring as possible, removing all features that may indicate creativity. The risk-minimization approach says that only one or two people will like the house more due to a fun feature, but lots of people will be turned off by it. Obviously, the designers of the typical McMansion have taken this advice: those places have only those features which are universally liked, like skylights and giganticness. After all, they're called McMansions because they match the lowest common denominator characteristics of a certain restaurant chain---which had a net income of $1.47 billion in 2003. We may think we're above it, but the lowest common denominator pulls down a lot of cash.

I tend to be less risk-averse myself, and feel that I'm in a different position than the McMansion builders. After all, I have one and only one house to sell. If I turn off a dozen buyers but get two or three who recognize the kitchen floor as a functional work of art, then I'm done.

But this doesn't solve the beauty contest problem: even if people think it's a work of art, they have to think that other people will agree. We have the same problem as before: if they believe that future buyers will be turned off by the floor, then they will decrease their bids accordingly. Since there are going to be so many more buyers who won't get it than buyers who do, the beauty contest reasoning is only going to push sales prices down further.

Notice, further, that many people didn't necessarily hate the kitchen floor per se, but were thrown because it didn't match their expectations. There is the Platonic ideal of the kitchen floor, and it's level and simple and generally pretty boring. It takes cognitive effort to accept and enjoy something that breaks expectations, and further, we generally assume that everybody is dumber than we are. [This has been verified in the lab a hundred times over. Think attribution bias or the Lake Woebegone effect.] So we'll assume that others are less likely to be able to exert whatever cognitive effort it took us to decide we like it---I've already committed this presumption above, and every buyer will probably do the same. The Lake Woebegone effect conspires with the setup of the beauty contest to push us to conform to expectations.

So why'd I do it? I was at a gallery opening at which a friend of a friend had two paintings on display, and the curator offerred a few pieces of advice to a gathered crowd. Never buy from a gallery in an expensive part of town, never buy from dealers who push the investment value of the piece, and more generally, the only reason to buy a work of art is because you like it. In the context here: forget the beauty contest, and go with what you deem to be beautiful.

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Replies: 2 comments

on Thursday, January 6th, GK said

so what would not qualify as a "McMansion"? You claim your
townhouse is a mass-produced people storage solution,
so what would qualify as a house? Stone walls?
Unique architecture? Your place has lasted a century, which
seems to indicate some degree of quality.

on Wednesday, January 12th, AH said

I like how you use data from your econ class in your blog. The floor does look nice, albeit a bit too labor-intensive. It seems like something that will always be the subject of conversation whenever you have new company. Are you ready for that? Also, how reflective are the mirror bits that you used? There's a reason why mirrors are so seldomly used as flooring...

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