Increasing Marginal Utility

A blog so good it violates the law of diminishing marginal utility.

Browsing Catharsis – 04.11.14

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Now, not all Marxists talk that way. But some do, and many more could. The point here is that both the libertarian and Marxist can agree that it’s wrong to initiate aggression, but they dispute who has a claim to what and so what counts as aggression. Neither one of them can resolve the dispute by pointing to the wrongness of aggression. Rather, they need an independent argument determining who owns what. You don’t reason your way from non-aggression to libertarian theories of property rights. Rather, you derive the libertarian non-aggression principle from a libertarian theory of property rights.”

-Jason Brennan, “On Begging Questions.”

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GOP politicians can’t have it both ways anymore. An economic system that simply doles out favors to established stakeholders becomes less dynamic and makes job growth less likely (most jobs are created by new businesses). Politically, the longer we’re in a “new normal” of lousy growth, the more the focus of politics turns to wealth redistribution. That’s bad for the country and just awful politics for Republicans. In that environment, being the party of less — less entitlement spending, less redistribution — is a losing proposition.”

-Jonah Goldberg, “What principles rule the GOP?

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Browsing Catharsis – 04.10.14

Papa Nutt, the Ben Bernanke of the operation, is offering discounts to Gathering vendors who accept the virtual moola; the hope is to establish it during the annual festival (‘No one wants to be the one vendor at Gathering of the Juggalos who doesn’t accept JuggaloCoin!’), move it to the ICP online store, and eventually so embed it in the culture that Juggalos can use it to purchase couches from each other on Craigslist (not kidding, that’s the example given).”

-Evan McMurry, “Juggalos Are Starting Their Own Cryptocurrency and You’re Not Invited.” Pretty sure this empirically falsifies the tenability of private currency.

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“That’s why your range of projections has to be narrower than the expected standings.  How much narrower? Over the past few seasons, the SD of team wins has been around 11.  Actually, it fluctuates a fair bit (which is expected, due to luck and changing competitive balance).  In 2002, it was over 14.5 wins; in 2007, it was as low as 9.3.  But 11 is pretty typical. Since a team’s observed performance is the sum of talent and luck, and because talent and luck are independent, SD(observed)^2 = SD(talent)^2 + SD(luck)^2. Since SD(observed) equals 11, and SD(luck) = 6.4, we can figure that, after rounding, SD(talent) = 9 So: if a season prediction has an SD that’s significantly larger than 9, that’s a sign that someone is trying to predict which teams will be lucky.  And that’s impossible.”

-Phil Birnbaum, “Predictions should be narrower than real life.”

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Under the Affordable Care Act, between six and eleven million workers would increase their disposable income by cutting their weekly work hours. About half of them would primarily do so by making themselves eligible for the ACA’s federal assistance with health insurance premiums and out-of-pocket health costs, despite the fact that subsidized workers are not able to pay health premiums with pre-tax dollars. The remainder would do so primarily by relieving their employers from penalties, or the threat of penalties, pursuant to the ACA’s employer mandate. Women, especially those who are not married, are more likely than men to have their short-term financial reward to full-time work eliminated by the ACA. Additional workers, beyond the six to eleven million, could increase their disposable income by using reduced hours to climb one of the ‘cliffs’ that are part of the ACA’s mapping from household income to federal assistance.”

-Casey Mulligan, “The ACA: Some Unpleasant Welfare Arithmetic.”

How much do we cheer overthrowing the NCAA?

The successful attacks on the NCAA combine two traditional enemies of proponents of free markets – unions and antitrust law. However,

  1. The “nuanced” free market view regarding unions is that it should be up to the market to determine their role and scope, as long as teamsters aren’t throwing bricks at people or something. It isn’t at all obvious today that the legal advantages unions hold aren’t canceled out by right-to-work legislation. Private sector unions, as they exist today in America, may be a good or a bad thing for the economy.
  2. The theoretical arguments against antitrust are very poor and typically get tangled up with discussing the illiberal reasons why antitrust was first adopted in the US, which has nothing to do with whether it should be practiced today. The best arguments are that effective antitrust law is practically difficult for a variety of reasons, e.g. how rarely the “bad” versions of oligopoly or monopoly really apply in real life, or how public opinion (and thus government) is firstly set against practices that look bad but are actually welfare-enhancing. In other words, it’s not the stupidest idea in the world to point out strange, particular cases where it may be helpful for the government to take a baseball bat to the head of a monopoly; merely on average it’s not worth it.
  3. Monopsony has long been a theory in search of an application. The Herculean assumptions needed to apply it to the market for unskilled labor would make Hercules blush. But if it applies to anything in the world in the private sector, it applies to professional sports, and perhaps even moreso to the NCAA. Is anyone willing to argue that the NCAA is operating in a contestable market?

So I look forward to lawsuits brought forth by labor activists on behalf of student athletes in coming years. On average, it’s not good to have institutional arrangements that still allow such lawsuits to take place. It’s kinda like the ban on CFCs, which looks like it was a good thing, even though command-and-control environmental regulation is on the whole terrible. Sometimes the government really does trip over itself and do something beneficial. It’s just not very instructive.

Browsing Catharsis – 04.09.14

“As it turns out there is a sizable literature in economics that examines these very issues and derives optimal policy. The conclusions of this literature are important because (1) they take the meritocratic view seriously, and (2) they arrive at policy conclusions that are often at odds with those proposed by advocates of meritocracy.”

-Josh Hendrickson, “What is Fair?

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“Elvis’ beard is terrible, by the way. Horrendous. He cuts half of his chin off, too I was just up there getting on him about it. Yeah it’s terrible. He looks like Abe Lincoln. … He has to cut that thing off. It’s so bad, it’s almost embarrassing.. .. I can’t even look at him it’s so bad.”

-Mike Napoli, via Marc Normandin, “Mike Napoli tells Elvis Andrus to shave ‘horrendous’ and ‘embarrassing’ beard.”

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Browsing Catharsis – 04.08.14

See more of… that… at Kotaku.

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“3)      Confusing shifts in demand and supply curves: No, lower oil prices is not helping the US economy if it is caused by a drop in global AD
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“9)      Central banks are printing money like hell – we will get hyperinflation (confusing demand and supply for money)”

-Lars Christensen, “10 fallacies of the Great Recession.”

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Browsing Catharsis – 04.07.14

“We show that, without strong auxiliary assumptions, it is impossible to rank groups by average happiness using survey data with a few potential responses. The categories represent intervals along some continuous distribution. The implied CDFs of these distributions will (almost) always cross when estimated using large samples. Therefore some monotonic transformation of the utility function will reverse the ranking. We provide several examples and a formal proof. Whether Moving-to-Opportunity increases happiness, men have become happier relative to women, and an Easterlin paradox exists depends on whether happiness is distributed normally or log-normally. We discuss restrictions that may permit such comparisons.”

-Timothy N. Bond, Kevin Lang, “The Sad Truth About Happiness Scales.” That is… problematic.

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“Under a second view, the process of being unemployed has made these individuals less productive.  Under a third view (‘ZMP’), these individuals were not very productive to begin with, and the liquidity crisis of the crash led to this information being revealed and then communicated more broadly to labor markets.  I see a combination of the second and third forces as now being in play.”

-Tyler Cowen, “Why are so many people still out of work?: the roots of structural unemployment.” So…. Cowen may have been right all along. This is becoming more and more persuasive, though this in conjunction with no inflation is still a puzzle.

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“This is clearly part of the appeal of a show like ‘Mad Men,’ in which ‘red America’ is the past rather than provinces, and where part of the thrill of watching (especially in the early seasons; less so now) is a kind of anti-P.C. escapism, into a world where men are Real Men, cars don’t have seatbelts, and everything seems so much sexier than in our more egalitarian and hygienic world. This thrill coexists with a smug present-ist judgment, of course, but that’s part of the show’s power as well: By slumming and judging all at once, liberal viewers get to have their enlightened post-1960s Whole Foods carry-out and dine on Oysters Rockefeller too.”

-Ross Douthat, “TV Fandom in Red, Bad and Blue.”

Browsing Catharsis – 04.06.14

Via Mark Perry. Were these included in the CBO’s poverty reduction calculations?

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“The second point is that there is something unnerving about a discipline in which our discoveries about the past do not easily generalise to the future. Social proof is a widely accepted idea in psychology but, as the donor experiment shows, it does not always apply and it can be hard to predict when or why.
This patchwork of sometimes-fragile psychological results hardly invalidates the whole field but complicates the business of making practical policy. There is a sense that behavioural economics is just regular economics plus common sense – but since psychology isn’t mere common sense either, applying psychological lessons to economics is not a simple task.”

-Tim Harford, What Next for Behavioural Economics?

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“There is zero desire in either party to regulate in a way that would inconvenience favored groups like MMMFs, small bankers, real estate salesmen, builders, and home buyers. Too many votes at stake. Instead, complaints about deregulation after a market fiasco are merely empty rhetoric designed to fool the public, earnest NPR listeners, and certain credulous bloggers and pundits. The real action takes place elsewhere, and much later, when no one is even paying attention. The GOP doesn’t want deregulation and the Dems don’t want regulation. Both want to use political power to advance the interest of their favored groups–often shared by both parties.”

-Scott Sumner, “What We Are Up Against.”

Is America flipping on what separation of church and state means?

In recent years, Americans have grown increasingly skeptical of the role of religion in politics. According to the Pew Research Center, the share of Americans saying there is “too much” expression of faith and prayer by politicians crept up from 12 percent in 2001 to 38 percent in 2012, enough for a plurality. Most now say that churches should keep out of political matters, and a majority agree that “religious conservatives have too much control over the GOP.”

Against this backdrop the Secular Coalition for America, a nonprofit group with a mission to “raise the profile of secular Americans” nationwide, released its rankings of how much — or little — legislators have supported the notion of church/state separation in the 113th Congress. Representatives were scored according to their votes and sponsorship of 14 bills related to church-state issues, including a measure in support of prayer in schools, a bill to amend the Constitution to prevent gay marriage, and a bill to eliminate funding for abstinence-only sex-ed. You can see the full list of bills at the Coalition’s Web site.

From here.

The American interpretation of the phrase “separation of church and state” has been that politics don’t mess with the church, and it’s what you see in the constitution and general attitudes historically.

The French interpretation – and I mean in the spirit of the French Revolution, not “French” as a pejorative – is that religious views do not involve themselves in politics.

In other words, it’s always been the case in America that people are allowed to use their religious beliefs to inform their politics. It is hard to make sense of American history if you think about it any other way. What do you think the Temperance Movement was?

Many on the left may wish to argue that the French interpretation is the preferable one, but it is very shallow and ignorant to suggest that the French interpretation has anything to do with the US constitution.

Browsing Catharsis – 04.04.14

Why other countries try so hard to be like the Nordic countries.

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Via Craig Calcaterra.

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“But without question, the blog’s primary impact has been on the American domestic front, from disputes surrounding eminent domain to the case against the Affordable Care Act. Indeed, the Obamacare challenge exemplified how The Volokh Conspiracy has radically transformed the legal landscape. In the past, the academy often looked askance at blogging as a distraction from more serious legal writing, to the extent that some professors initially joined the Conspiracy under pseudonyms to conceal their involvement. Today, however, blogs have become the driver of the discourse. ‘The way law professoring used to work was that you would spend a year writing a law review article, you would workshop it among other professors, and maybe in 18 months, it would come out in a printed book that no one would ever read,’ explained Blackman, the South Texas professor. ‘Now a case is decided and within a few minutes you can post a few hundred words on a blog, which becomes now the narrative shaper —and I think you can credit that to Eugene Volokh and the other conspirators.’”

-Yair Rosenberg, “The Volokh Conspiracy Is Out To Get You—And Everyone in America.”

Browsing Catharsis – 04.02.14

Homestar Runner update. Yes, really. It currently runs when you access the home page - they may have that changed by the time you read this.

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“Demographic research into parents who are reluctant to vaccinate their children demonstrates that they’re not only wealthier and more privileged than average, but they also happen to have more kids. You don’t need a degree in economics to understand, therefore, that there are benefits to being a pediatrician willing to shun scientific evidence in favor of pandering to the New Age-y pretensions of a wealthy and fecund anti-vaccination clientele. Speaking of: Kiera Butler of Mother Jones went to Marin County, Calif., an affluent area where, according to Butler, ‘skipping immunizations is far from unusual among parents,’ where kindergartners have ‘one of the nation’s lowest vaccination rates,’ and ‘the county also has the second-highest rate of pertussis (whooping cough) in California.’ There, Butler interviewed Dr. Stacia Kenet Lansman of Pediatric Alternatives, a name that seems designed to let parents know that all sorts of anti-vaccination paranoia will be indulged, so come on in.”

-Amanda Marcotte, “Meet the Anti-Vaccination Pediatrician Catering to California’s Rich, New Age-y Parents.”

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