The specter of neoliberalism

When I talk about international economic policy with my students, one of the models they use to analyze it is a bizarre potpourri concept known as “neoliberalism”. I understand the appeal of the framework to non-specialists: there are good guys and bad guys, and because it’s so broad your pet concept probably always fits in. The problems, as I see them, are that it has good guys and bad guys, and it’s so broad that your pet concept probably always fits in. While it’s valuable to have some moral lens to see the world through, it’s crucially important for intellectually responsible people to separate questions of fact from questions of values.
nike air max 95
It’s sobering to have to remind people that Pinochet, Thatcher, and Reagan were not economic theorists, they were political leaders. In light of what we know from public choice theory it should be no surprise that political leaders sometimes do Bad Things. But ideas about how societies should go about seeing resources distributed and the limits of human ability to engineer broad-based solutions to social problems don’t depend on anything these politicians did.
ray ban sunglasses replacement parts
Most people are not familiar with the history of economic thought, and don’t understand how the failures of the orthodox Keynesian theory that dominated the West after World War II became so apparent that the intellectual tides changed in the economics profession long before any real policy changes resulted. It was because of these failures that new theories came to the fore, ultimately becoming accepted enough even to have some small influence on policy. (Small because public choice problems never went away.) If Jimmy Carter had won the 1980 US presidential election, he would have done many of the same things that Reagan did, because that’s what his economic advisers would have advised, because that’s what people who studied the topic had come to agree on. In fact, airline deregulation happened under Carter, not because Carter wanted to unleash the rich and powerful on all of us poor saps, but because that’s what the technical consensus had come to. We hardly even think about it anymore, but without that policy change many of us might never have been on planes before, much less been on planes enough to have routines for how we spend our time on flights. Lowering at least some barriers to trade was an idea whose time had come.
nike air max cheap
For people unfamiliar with the history of economic thought it was a tale of certain people rising to the top and using their power to make massive and very bad policy changes. If you think that the top-down theories that had dominated policy prior to the change were the obviously right ones, then the only thing that makes sense is that people consciously torpedoed them, and probably people who were ill-intentioned. But that doesn’t hold up entirely. It wasn’t Reagan and Thatcher who killed orthodox Keynesianism. As a technical paradigm it was dead when they arrived. That they did many other things people still don’t like is beside the point.
ray ban cats sunglasses
It’s tempting to succumb to a moralistic framework. It has a very primal appeal. But it makes me think of 1 Corinthians 13:11: “When I was a child, I used to talk as a child, think as a child, reason as a child; when I became a man, I put aside childish things.” Many of the things people get emotional about are really technical issues, and it’s the responsibility of academics and analysts to treat them that way, especially in front of non-specialist company.

Cargo Cult Development: Signaling in the upper echelons of higher education

Ecuador, my home country, is hell-bent on increasing the production of individuals with advanced degrees. Through highly (ridiculously?) onerous regulatory requirements, generous scholarships, and billions of dollars invested in higher education infrastructure, the self proclaimed socialist of the XXI century government has led a big push for higher education. Although the claim is grounded on the positive externalities of education and the formation of human capital as necessary for development, I have always wondered whether the big push for education is more like cargo cult development rather than genuine development. What the pacific islanders did not understand when they built their airstrips and waited for goods to fall from the sky, is that airstrips and the accompanying capital structure that produces goods are consequences of development and not their cause. It is fair to ask whether governments undertaking massive investments in education like building billion-dollar research sites are they making the same mistake.
discounted oakley sunglasses
Of course the immediate reply by most economists is that education is not like cargo cult development because we can identify the mechanism behind such development, specifically in endogenous growth models. The logic is that increasing human capital, especially in advanced degrees, increases the production of knowledge that due to its non-rivalrous and partly non-excludable nature spills over the productive sector and raises productivity and standard of living for all. Thus the positive externality of knowledge justifies public investment in R&D in this case by subsidizing the production of individuals with more advanced degrees. After all the mantra of economic growth for a little over 20 years has been that the generation of ideas is the “real” driver of growth. While these arguments certainly help advance our understanding of the determinants of growth in broad strokes, they also point to the limitations of an institutionally barren production-function-for-the-whole-economy approach to growth (more on this to come).
Oakley sunglasses Factory
The signaling model of education presents a more immediate challenge to the big push for education policies. While not completely denying the human capital-forming role of education, the signaling model challenges the relative importance of human capital in education. The signaling model implies that there are negative externalities to subsidizing education. By lowering the cost of acquiring a degree, the signal of worker quality is degraded because more low quality workers get through the selection mechanism (obtaining a degree). A new signal is needed to separate between worker qualities, leading to more expenditure of potentially productive resources in a sort of arms race of higher education degrees. If education does not lead to great improvements in human capital but is driven by primarily by signaling instead, even if there are positive spillovers from knowledge, subsidizing education may not be such a great bet, especially since the contribution of the signaling mechanism is negative in social terms.
nike air jordan vii
I am very sympathetic to the signaling argument (Bryan Caplan makes a very convincing case) and I think they are often/mostly/always ignored by those making big push for advanced degrees policies, and shouldn’t be. However when I do manage to engage advocates of big-push-for-advanced-degrees, two arguments always come up against the signaling model.

1) Even if the formation of human capital is small relative to signaling it is still there, and low-income countries have much more to gain from small increases in human capital (which then leads to knowledge creation that spills over and increases productivity).

2) While signaling may play a large part in lower end (undergraduate degrees) degrees, in advanced degrees (doctoral degrees) it is mostly human capital and not signaling, thus government spending in advanced degrees is an investment in human capital (which then leads to knowledge creation that spills over and increases productivity).
nike air max Outlet Online
My partial objection to 2) is that human capital and signaling are potential explanations for the investment (present expenditure aimed at greater future income) aspect of education. But there is also a consumption (present expenditure aimed personal satisfaction) aspect to education. The more advanced the degree, not only does the human capital component (presumably) increase, also the consumption aspect of education increases as well. Why pay for something individuals will probably pay for themselves in search of their own satisfaction (and benefit us with all the great ideas that spill over from their activity, maybe)?
nike air jordan v5 retro
A further interesting possibility with respect to 2) is given in this post on The Economist’s Free Exchange blog (based on this JEP paper). If advanced degrees are aimed at improving human capital that increase the productivity of those generating knowledge, a good proxy for human capital formation and knowledge creation in advanced degrees is the research productivity of graduates. The low productivity of economics graduates as Free Exchange notes can be interpreted as a sign that signaling is very prominent for those pursuing the most advanced degree in Economics. It would be very interesting to see research productivity in other disciplines as a test of the significance of signaling in advanced degrees in general.
ray ban replica sunglasses

The Modern Challenges to Science

[This is a modified repost of an article I had originally posted on my now-defunct personal blog. I repost it here for two reasons: (1) I think the subject matter at hand is still extremely important and relevant, and (2) I will make frequent reference to this in upcoming posts.]
oakley flip up sunglasses
Imagine your pet political group that makes claims you find stupid or offensive: racists, creationists, the Westboro Baptist Church, whomever. However incorrect we might think personally they are, most of us find silencing them to be unfair, since they have a right to be heard and granted an equal say in our tolerant, deliberative, modern democratic society. This is precisely the point of this post. The modern challenges to the progress of science are not so much creations of the religious fundamentalists on the political right (though this undeniably still exists), but more so from the humanitarian and egalitarian arguments commonly associated with the political left.
air jordan Cheap
One of the best books I have read in recent years, period, is Jonathan Rauch’s Kindly Inquisitorswhich makes precisely this point.  The book is slightly dated (printed in 1995), but there was a new edition out this year [that I have yet to read] with more recent anecdotes.  Nonetheless, the arguments are timeless, and even the anecdotes from the 1980s and 1990s Rauch uses to illustrate his points are eerily similar to examples we still might see in our media and discourse today. Permit me to paraphrase his argument, with my own commentary.
oakley straight jacket sunglasses
There are three main challenges against the progress of science:

The first is the “Traditionalist Challenge” – the obvious and easily visible ones from religious fundamentalists.  They argue that those who know the truth should decide who is right.  Invariably, each religious sect (insofar as it is making descriptive claims about the world, not simply providing religious services) is certain that they, and only they, know the truth, and necessarily must control and censor all contrary opinions as blasphemy through an inquisition.  Clearly when multiple sects hold different beliefs, the only resolution to decide who is right is through violence.  We don’t need to spend a lot of time dissecting and overcoming this authoritarian challenge because that has already happened, slowly and painfully, over the last several centuries.  This challenge comes from a minority that most people today ignore or mock, compared to the other two.
oakley prescription sunglasses
The second is the “Egalitarian Challenge.”   This is the rather appealing argument that since everyone is equal, everyone’s opinions claim an equal right to respect.  A more radical version of this principle is that for those political classes that have been historically oppressed, their opinions should be disproportionately respected more than those opinions of historically privileged classes.  Intuitively, at least the non-radical version sounds perfectly sensible, and one is hard pressed to morally argue against it.  But even so, this would stop science in its tracks if followed it to its full implications.   There is a big difference between equal opportunity to participate in science (which is untenable to reject) and  the equality of treatment of one’s scientific results.   Einstein was an outsider to the scientific community, a Swiss patent clerk nobody, but he was elevated with scientific praise because his predictions were verified – if he had predicted instead that gravity was made of cheese, he would be rightly dismissed as a crank and never would have left the patent office.

There is a strong difference between knowledge and belief here.  My fictitious Einstein is totally fine to continue believing gravity is made of cheese, even after being rejected by the scientific community.  We can certainly respect his belief as his own opinion, which he has every right to, however odd it may be.  But that is one thing.  It is a completely different matter when these beliefs are made policy relevant, and are to be taught to others as knowledge. It would be a horrible world for the progress of science if knowledge was made by voting and campaigning between political groups.  When we are forced to be given equal time for different viewpoints in our national discussion, we make marginalization illegal.  We will be living Bertrand Russell’s nightmare, where “the lunatic who believes that he is a poached egg is to be condemned solely on the ground that he is in the minority” (Rauch 1995: 118, my emphasis).  

The third, and related challenge, is the “Humanitarian Challenge.”  This is another appealing argument that says everyone has a right not to be harmed.  More specifically, people have a right not to have their feelings or inherent dignity hurt and be told their beliefs are wrong.  This is another admirable moral belief, but it would again halt the progress of science, which, for better or worse, is made entirely on the basis of proving past beliefs wrong.  There are plenty of anecdotes about the personal tragedy of scientific careers (even lives) ended because a different scientist proved their theory wrong.  But while these costs are concentrated on those scientists who put their theory at stake, the benefits are dispersed across all of society, who are now elevated to greater understanding and knowledge.  
Oakley sunglasses Denmark
If we were to follow this challenge to its conclusions – science is viewed as a form of violence against others.  Fighting words over different theories are viewed just like bullets.  And how do we prevent violence?  Through active policing and a greater monopoly of violence – so we’ve secretly returned to the inquisition from the Fundamentalist Challenge (ibid: 131).  Nobody has a right not to be offended, which of course would imply that any opinion that they personally did not like ought to be suppressed.   So why do we tolerate the racists and the bigots and the pseudoscientists?  Because the alternative would be worse.  Instead, we simply criticize, ignore, and marginalize them from public discourse – certainly more humanitarian than the alternative.
Best Price Oakley sunglasses
Finally, Rauch defends the only robust alternative, what he calls the “Liberal Principle of Science” (note “liberal” here is akin to the more broader “classical liberalism,” rather than the modern progressivism we Americans attribute to the word in politics today.)  The liberal principle is defined by two key tenets (ibid: 48-49):

  1. “No one gets the final say: you may claim that a statement is established as knowledge only if it can be debunked, in principle, and only insofar as it withstands attempts to debunk it.”  Science, unlike faith, or pseudoscience, is constantly being updated and is never fixed.  Newtonian physics gives way to Einstein’s relativity, which gives way to Quantum Mechanics, which may give way to something in the future.  Scientific theories only persist as far as they have not yet been invalidated.
  2. “No one has personal authority: you may claim that a statement has been established as knowledge only insofar as the method used to check it gives the same result regardless of the identity of the checker, and regardless of the source of the statement.”  Anybody at all can play the science game.  There are stories of nobodies disproving scientific theories originally posited by Ph.Ds and experts.  Access to the scientific community in principle is free (it is obviously not perfect or costless), one need only be able to demonstrate and argue the truth or falsity of a claim.

Thus, science progresses by criticism.  Those whose theories about the world have been demonstrated to be incorrect (such as the phlogiston theory, the miasmic theory of disease, or most notably, the Ptolomeic model of the heavens) are marginalized and ignored.  They can certainly still firmly hold these beliefs about the world and we cannot fault them for that, but for them to try to pass these disproven beliefs as scientific knowledge, we have no choice but to risk their offense for the sake of human progress.  Whether this is morally and psychologically comforting or not, the alternative is just too costly.
ray ban sunglasses discount
Science, and the reason for its success, is not just the method that we learn in 8th grade.  Indeed, most of science is not done in this discrete, systematic, and methodologically monist way, and there are those, like Paul Feyeraband, that argue there is no uniform scientific method.  What is more important is the institutional framework of science – the scientific community and its relationships.  A number of authors, like Michael Polanyi, have written on the importance of viewing “science” as an institution and a community.  It is a bottom up, emergent spontaneous order of individual scientists pursuing their own research agendas, linked and checked by other scientists and mechanisms like peer review, publishing in academic journals, and academic conferences. Vlad’s post on how to disagree with the economic mainstream, and more specifically, his recent paper on this topic emphasizes this insight. 

Put another way, an individual scientist can very easily do bad science – cherrypicking examples, abusing statistics, falling victim to confirmation bias, and a host of other problems.  Indeed, there are often incentives encouraging one to do so – one can only publish an interesting result, so there is every reason to ignore non-interesting but important null results, or to cook the numbers to make it look interesting. But the community as a whole does good science because of the mechanisms that correct these errors and criticize and weed out the bad science.  Since science works through criticism, it pits the reputation of scientists against one another to incentivize each individual scientist to prove the others wrong and bask in the limelight.  The liberal community of science is not perfect – there is no perfect institutional arrangement – but it is far better than any comparable alternatives.

Emergent meta-order

The Constitution and By-Laws of the Hopi Tribe went into effect on December 16, 1936. Prior to this, the tribe was in a constant state of chaos and mayhem for a thousand years.
ray ban sunglasses Greece
No, actually, the tribe was governed peaceably and well by customary law, including customary constitutional law. That is, there were always rules that governed interactions between people and among groups of people within the Hopi tribe, and there were always higher-order rules about how rules would be adopted or modified. They were often tied into the Hopi religious system. They may not have been written down, but they were as real a force in Hopi life as the written constitution of 1936 is today.
air jordan 1
One of the major motivations for a written constitution was that the United States government had gradually taken over the land around them (and around the Navajos, whose present-day reservation encircles Hopi land) and they were also beginning to be absorbed into the US economy. They were increasingly interacting with the expanding US—sometimes voluntarily, but not always so—a novel situation to the tribe and therefore not part of its constitutional and legal system. For exapmle, the distribution of land had previously been handled by customary law, with land owned by clans and assigned to members of clans; new land began to be cultivated and passed down in accordance with US law, which required updating the Hopi legal system.
Discount Oakley sunglasses
The law & economics fields deals largely with emergent law, but the constitutional political economy field seems mainly to focus on what features would make for good constitutional design. Granted, it is much harder to study implicit constitutions, and in the modern era we think of constitutions as something a single entity creates consciously. Also, the field of constitutional political economy has been concentrated in and on the United States, where a written constitution is in force. But Britain, for example, has an implicit constitution, not created but emergent. By better understanding emergent constitutions the field would be better able to cross-pollinate with fields like development. If our logic is good—and it is—we can take it far.Discount Oakley sunglasses

Interstellar Blasts Out of the Hollywood Distribution Mold

The recent Christopher Nolan blockbuster Interstellar is grabbing headlines all over the internet for its scientific innovation and uniqueness within Hollywood. This post isn’t a review of Interstellar–suffice it to say you need to go see it, I’m still debating with my friends exactly what happened in the movie (and for what it’s worth, here’s a theory that I find most plausible). What is interesting and novel, about Interstellar, and Christopher Nolan, is just how the film was made, namely how atypical it was in the usual Hollywood scramble for copyrights and control between studios and the artist.
Oakley sunglasses Korea
A number of news articles came out profiling the cult director and describing just how unusual this process was. This post is an opportunity for me to point out the role copyright has the on economic structure of the film industry, and highlight Christopher Nolan’s success as one of the exceptions that prove the rule.
nike air jordan clothing
The average Hollywood film follows a pretty common formula in terms of both subject area and distribution mechanism. Despite all the rhetoric that copyright ensures the independent artist she can put bread on the table for her work by giving her recourse against ungrateful pirates, the entertainment industry in the 21st century really is just a continuation of ancient patronage of the arts in modern form. Instead of wealthy elites sponsoring an individual artist like the Medici did for da Vinci, the Pope for Michelangelo, and the Duke of Tuscany for Gallileo, we have large movie studios bearing the cost of producing movies for artists and filmmakers in exchange for copyrights and a cut of the profits. In the U.S., there are the “Big Six” film studios–Warner Brothers, Disney, Universal, Sony, 20th Century Fox, and Lionsgate, which collectively accounted for over $8 billion, or 75% of all industry revenues in 2013. Independent filmmakers do exist, of course, but in the end often cut deals with the Big Six and turn over their copyrights in exchange for tapping into the big boys’ distribution network in hopes of reaching an audience of more than just midnight viewings staffed by hipsters.
Canada ray ban sunglasses
Maybe that’s all well and good, assuming the goal is simply to “promote the Progress of Science and useful Arts” for the public welfare, as Article I §8 of the U.S. Constitution mandates. Economies of scale allow for a more efficient distribution mechanism to serve consumers, if not always the artists. The problem is that in the process, the rights to display the film, as well as the right to prevent others from viewing the film without authorization (i.e. “copyright”) are always transferred to the film studios. These firms, rather than the artists, are the ones with both the financial resources and the political muscle to hunt down infringers and to capture the regulatory process to put these copyrights to work maximizing their rents at the expense of consumers and taxpayers. But that’s for another post.
Canada Oakley sunglasses
Naturally, the Big Six aren’t going to accept any “I’ve got a brilliant idea!” pitch willy-nilly. Often they will seek a movie idea that is safe, and simply hire out the director to produce their movie. Sometimes this reaches absurd levels, where simply to protect a right from expiring, they will intentionally produce an awful B-movie version, like the 1994 Fantastic Four film. Furthermore, in the midst of the threat of internet piracy, studios and producers now demand control over a wider swath of revenue streams than just box office ticket sales: merchandise. And what produces merchandise like no other? Franchises full of sequels, plots ripped off of books, and reboots of sequels of plots ripped off of books. For better or worse, studios stick to the conservative revenue-maximizing formula of big action blockbusters with little arete but lots of explosions capable of spawning sequels with rapid diminishing returns to substance.
Ireland nike air max
This is where Nolan and Interstellar come in to kick things apart, rather than kick the can down the road. Love or hate his movies, he, along with James Cameron, or Steven Spielberg, is one of the few artists who can pitch a standalone movie to a studio and get wide liberties to produce it. Interstellar is (so far as we know), like Nolan’s previous Memento, The Prestige, and Inception (though notably the Batman trilogy was a franchise/reboot cash cow), a standalone movie without a big opportunity for franchising or sequels, and is original content rather than a rehash of a book (though some Heinlein fans may be shaking their fists). In fact, the prospect of this one film captivated Warner Brothers so much that in exchange

For the right to distribute Interstellar internationally, Warner Bros traded the rights for two of their franchises, Friday the 13th and South Park, plus “a to-be-determined A-list Warners property”, while its subsidiary, Legendary, agreed to trade Batman v Superman: Dawn of Justice for a further piece of the pie. To say this disregards the reigning economic logic of modern Hollywood is not quite right – it reverses the normal logic by which Hollywood operates. Franchises are the lifeblood of the studios. For Warner Bros to hand over the rights to two of its well-known properties, representing money in the bank, for the opportunity to take a spin on an original idea – a film with no sequel potential and few merchandising opportunities, based on the dimly understood recesses of quantum physics – speaks both to the value placed by the studios on Nolan, and also the extent to which he has become a franchise unto himself. (Guardian)

Nolan is also very strategic about his expenditures: he always comes in under-budget. This is a big plus for Big Six in seeking him out, but there’s also an ulterior motive that benefits Nolan:

“What he realised very early on was that the moment you give the studios an excuse to come in, you’ve lost it,” said Emma Thomas, Nolan’s wife and co-producer…“We watched it happen,” Thomas said. “The moment you go over budget, you’ve lost the creative control than an obsessive director like Chris needs.” (WSJ)

oakley straight jacket sunglasses
While perhaps people value Nolan’s movies as art for art’s sake, what really helps them stand out is the rest of the noise in Hollywood. Now if only people who appreciate movie substance can find an alternative mechanism to raise films to the same level of success– crowdfunding perhaps? Then again, maybe what makes indie films indie is the fact that they’re not Hollywood blockbusters…


Proprietary cities and institutional change

Alex Tabarrok has an interesting post on proprietary cities in India.  He writes,

In Lessons from Gurgaon, India’s private city (working paper) found in a new book Cities and Private Planning  Shruti Rajagopolan and I explore this question. Gurgaon, which I have written about before, shows both the successes and failures of private development. On the surface, Gurgaon is a gleaming, modern city built nearly overnight on wasteland. Gurgaon was built, however, without benefit of planning and its failures–most notably poor and inefficient provision of  water, sewage, and electricity–are a warning. The failures all stem from high transaction costs, Gurgaon’s private developers have simply not managed to Coasean bargain and internalize externalities. It’s clear from Gurgaon that cities need advance planning–a reservation of rights of way for water, sewage and electricity at the very minimum–but does the planning have to be provided by government which is often incapable of such foresight?
air jordan v
Clearance air jordan
The lessons of Jamshedpur, India, suggest another approach. Jamshedpur is a private township, planned from the beginning by visionary businessman Jamshetji Nusserwanji Tata, who, after travelling to the United States to see Pittsburgh, returned to India to found Tata Iron and Steel. Jamshedpur has been run by a single, integrated entity for over 100 years and as it is integrated it has internalized externalities. As a result, Jamshedpur, India’s other private city, has some of the best urban infrastructure in all of India.

While supplying good infrastructure is important, it pales in comparison to the importance of institutions.  If these developers are going to spend hundreds of millions or billions of dollars why not lobby the state to opt out of onerous laws.  Florida created a special district for Disney to create an amusement park.  Surely the benefits to India would be far greater.
Buy ray ban sunglasses
SEZ growth

ray ban sunglasses Discount
The Growth of SEZs suggest governments are increasingly willing to grant local legal autonomy.  Proprietary cities could start by opting out of licensing laws and other trade restricting legal burdens.  Such a process would have to be carefully managed, but eventually (or sooner) allowing a proprietary city to hire a common law judge to adjudicate disputes seems to have little downside.  Why not give it a try?
Germany nike air max
Edit: Thanks Tom Bell for the graph.  Be sure to watch out for his new book Your Next Government?

What’s wrong with economics?

The recent economic crisis has brought about an entire chorus of complaints about economics. Student groups request changes of curricula, institutes for new economic thinking became more prominent, Eugene Fama got a Nobel Prize. Oh wait… I think most of these critiques have been misguided and, yeah, Fama is pretty awesome. These critics are a little bit like complaining that meteorologists don’t control the weather better or that geologists do such a poor job at predicting when exactly San Francisco is going to suffer the next big earthquake. But still, I think there are many things that are shaky with mainstream economics.
nike air jordan shoes for sale
Before I give you my draft list, here’s how not to complain about mainstream economics. Don’t just pick your pet theoretical peeve and whine that other people don’t find it as interesting or important as you do. That’s not “failure of economics”, it’s either your failure to explain your position or, blasphemy!, you’re wrong. A failure of economics can only be institutional, i.e. somehow you have to show that the organization of the economics profession is a priori biased against certain positions. You can have either an emergent order argument about this (the bias is part of no one’s intention or strategy, but it occurs in the aggregate for some reason) or a corruption story (the economics profession gets captured by certain interest groups). So, here’s a list of such likely institutional failures:

    oakley breathless sunglasses

  1. The sources for macroeconomic data are mostly governmental. Not only do they suck, e.g. according to the data the Earth as a whole has a $300-$700 billion trade surplus with outer space, but we also don’t know exactly just how much each piece of information sucks – amazingly, all the numbers in the, e.g., World Bank dataset come without margins of error. As you may imagine, governments have a vested interest to distort the data in particular directions.
  2. The intended use of data determines what kind of data one gathers. Most macroeconomic data is intended to serve the purpose of government controlling the economy. To control the economy one does need some understanding of how it works in terms of causes and effects, but, still, one is going to be biased towards a very aggregated perspective, because the possible levers of control are few. James Buchanan & Richard Wagner have a classic paper on this, “The political biases of Keynesian economics” and Peter Boettke has recently restated their argument.

air jordan Closeout
These two arguments are about emergent order biases. Here’s also two corruption stories:

  1. The editors of all major monetary economics journals have and have had personal connections with the Federal Reserve. Larry White is pretty convincing that this is indeed a problem as these journals act as a filter as to what counts as respectable opinion about monetary economics.
  2. Most economists writing about business rely on businesses for their empirical data and have personal connections with firms that make them biased in favor of business interests. Luigi Zingales has recently caused a bit of a splash making this argument, and also being careful to point out that being pro-business is quite different from being pro-market. (His discussion with Russ Roberts about this is pretty interesting too.)

What else?
nike air jordan vii 7 retro
PS. Here’s my recently published paper on how a scientific community works and about which factors can bias science (and which are less likely to do so).

Culture and space colonization

Consider the following thought experiment.  Earth is dying, unable to further sustain human life.  Mankind has thrown their last resources into creating a space ship that can reach a habitable planet.  However, the space ship can only carry 10,000 people and little is known about the planet beyond gravity and oxygen levels.  With the literal fate of humanity lying before us, who do we send and why?
air jordan Online
Traditionally, attempts to answer this question have focused on individuals.  We would pick the most outstanding specimens of humanity, our greatest scientists and athletes.  However, there is a more important dimension to consider, what cultural group should we send?  To further refine the question and focus the mind, if we could bet on the outcome, which cultural group would have the highest probability of success?
nike air max 95 womens
For all the praise of multiculturalism, no one would seriously bet a diverse group of cultures would give the greatest chance for success.  Even if we ignore the obvious language barrier, consider how children are raised.  What is standard practice for one culture might be considered child abuse in another.  The differences in raising children are merely indicative of numerous other problems which arise among different cultural groups.  Ethnic fractionalization is associated with numerous bad outcomes in the economics literature.
nike air max Factory
Picking a cultural group to colonize a new planet and save humanity forces the mind to focus on positive and negative attributes of the cultural group.  Positive aspects include trust as well as a tradition of liberal democracy.  Without trust impersonal exchange becomes nearly impossible.  Further, a people who have only known tyranny are likely to recreate such tyranny in their new homes.  A last consideration is the malleability of their formal institutions.  A new planet will likely present new challenges which require new solutions.  As such, a people with a history of adapting would be better than a people without.
air jordan 11
My personal choice would be to send the Swiss.  Their informal institutions are comparable to other first world countries.  Their form of government, Cantons, which is likely to be recreated in part in the new planet, is what gives them their decisive advantage.  By decentralizing the provision of public goods they will be able to respond more rapidly and effectively to the new challenges that await them while giving a new life for humanity.

The Victorious and the Resentful, Socialist calculation past and present

Twenty-five years ago today the Berlin Wall fell, that monument to the brutality that the domesticated ape is capable of when its operating software is infected by bad ideas. Twenty-five years is a dangerous amount of time because it is enough time for an entire generation to have grown up largely unaware of the significance of the event, and by extension of the horrors of socialism when put in practice. Around 42% of the current world population was born after the fall of the Berlin Wall. Yet considering that before a certain age (around 15?) politics and economics are largely alien interests, the percentage of us that are left largely to our own devices to learn about this history is much greater than 42%. This is dangerous if there is some reason to believe that those who do not know their history are condemned to repeat it.
nike air max cheap
Another reason that twenty-five years is dangerous, is that it is just enough time for those who cried of sadness (and many in my home Latin America did) instead of joy when the wall fell to have distorted history enough to make socialism appealing once again. After all history, is not written by the victors, it is written by the resentful (regrettably these are often the same ones that write the textbooks). The advance of twenty first century socialism by Podemos in Spain, and its consolidation in Latin America, are proof positive that the failure of socialism in Eastern Europe has long been forgotten by those not directly affected by it, and that it has been revived and revised by the necromancers of bad ideas. In trying to understand how this is possible at least part of the problem is thinking that societies learn from their past. Societies do not learn from their past, individuals do. It is only when the learning of individuals is institutionalized that societies are capable of learning. But this analysis stops short as well because institutions are only self perpetuating on average terms and in the long run, the consolation of the economist is the misery of everyone else that lives in crests and troughs of history, and not on the trendline.
air max 95 release dates
The revived version of socialism slightly alters the means and goals of its former self. Unlike its Marxist-Leninism, it does not aim at producing more than capitalism, but rather at producing “buen vivir” or good living (as defined by the government’s sub-secretary of good living of course). The means have been revised as well, rather than the complete abolishment of private property, productive firms are to be directed by the state, with only certain sectors ripe for outright nationalization. Very reminiscent of Lenin’s New Economic Policy. Thus the only problem with socialism that this revised version concedes is the one that all practical implementations have conceded, the one pointed out by Mises, something really telling about the fundamental economic problem with socialism. The concession in the means employed by all the implementations of socialism is really a testament to Mises’ paradox of planning. The change in the goals of twenty first century socialism is telling as well. If you can’t accomplish what you originally set out to accomplish with the means you propose, alter your goal to that which your means can accomplish. If the means you propose are unable to deliver material prosperity but instead deliver poverty, redefine poverty as “good living”, and set up an official agency to preach about it.ray ban sunglasses Discount

Ryan’s Intro

I’m happy to a part of this blog with my good friends and colleagues. I am in my fourth year at GMU and am currently on the academic job market (wish me luck). My dissertation brings an institutional focus to bear to copyright and its alternatives.
Clearance nike air max
I plan on focusing my posts here largely on ideas and intellectual property (IP), both at a scholarly and popular level. I believe IP is one of the big issues of our age, and especially our generation. I think that we are not bringing all of our intellectual resources we have down to bear on the issue: rather than focusing on optimizing a tradeoff between increasing incentives for innovators and increasing monopoly power from an engineering standpoint, I think we should better understand the nexus of institutions involved in managing the common pool resource we call knowledge. At a broader level, what really interests me is the political economy of alternative institutions that provide public goods.
Greece Oakley sunglasses
I view this blog as the spiritual successor to all the temporary personal blogs I have tried to maintain over the past few years at my personal website. I will stop blogging at my website and focus all of my attention here.
Czech Oakley sunglasses
You can find more about me, including my research, CV, and teaching, at my website: