Markets in everything, old school edition

by on September 19, 2011 at 1:58 pm in History | Permalink

From 1836 to 1940, the Bellville family of London operated a business of letting people know the time. Ruth Bellville, the most famous member of that family, walked around London with a high grade watch that had been set to within one tenth of a second of the Royal Observatory in Greenwich. For a fee, she’d tell you the current time…Belville continued to ply her trade up to the age of 86, including making the twelve-mile journey on foot to Greenwich.

Here is the post and I thank John Thorne and Peter Metrinko for the pointers.

Robert September 19, 2011 at 2:59 pm

“Twelve miles to Greenwich”?
According to google maps Greenwich Observatory to St Paul’s Cathedral is 5.5 miles on foot. I think its more likely that her entire walk around her customers was 12 miles.

Roy September 19, 2011 at 7:53 pm

But St Paul’s has never been the Western end of London, Parliament and Westminster are about 10-12 miles from Greenwich, so it makes sense.

Robert September 20, 2011 at 4:30 pm

I don’t think you are right Roy.
First of all St Paul’s has been on the western side of London for most of its history; its only really since the 18th century that London has expanded enough for this to not be the case.
Also, according to google maps Greenwich Observatory to Westminster Abbey is 6.5 miles on foot. 12 miles west of Greenwich is beyond Shepherd’s Bush.
Wikipedia mentions the 12 mile figure, but the reference given does not mention it. In fact the reference mentions that most of the original customers of the business were in the City or Clerkenwell; i.e. only about 6 miles from Greenwich.

I think the 12 mile figure is bogus.

E. Barandiaran September 19, 2011 at 3:26 pm

The reference to a “dirty tricks” campaign to put the Bellville out of business reminds me to refer you and your readers two new NBER working papers.

One by Gilles St. Paul (wp 17431), “Toward a Political Economy of Macroeconomic Thinking”, is about:

This paper investigates, in a simplified macro context, the joint determination of the (incorrect) perceived
model and the equilibrium. I assume that the model is designed by a self-interested economist who
knows the true structural model, but reports a distorted one so as to influence outcomes. This model
influences both the people and the government; the latter tries to stabilize an unobserved demand shock
and will make different inferences about that shock depending on the model it uses. The model’s choice
is constrained by a set of autocoherence conditions that state that, in equilibrium, if everybody uses
the model then it must correctly predict the moments of the observables. I then study, in particular,
how the models devised by the economists vary depending on whether they are “progressive” vs. “conservative”.
The predictions depend greatly on the specifics of the economy being considered. But in many cases,
they are plausible. For example, conservative economists will tend to report a lower keynesian multiplier,
and a greater long-term inflationary impact of output expansions. On the other hand, the economists’
margin of manoeuver is constrained by the autocoherence conditions. Here, a “progressive” economist
who promotes a Keynesian multiplier larger than it really is, must, to remain consistent, also claim
that demand shocks are more volatile than they really are. Otherwise, people will be disappointed by
the stabilization performance of fiscal policy and reject the hypothesized value of the multiplier. In
some cases, autocoherence induces the experts to make, loosely speaking, ideological concessions
on some parameter values. The analysis is illustrated by empirical evidence from the Survey of Professional
Forecasters.

The second one by M. Gentzkow and E. Kamenica (wp 17436), “Competition in Persuasion”, is about

Does competition among persuaders increase the extent of information revealed? We study ex ante
symmetric information games where a number of senders choose what information to gather and communicate
to a receiver, who takes a non-contractible action that affects the welfare of all players. We characterize
the information revealed in pure-strategy equilibria. We consider three ways of increasing competition
among senders: (i) moving from collusive to non-cooperative play, (ii) introducing additional senders,
and (iii) decreasing the alignment of senders’ preferences. For each of these notions, we establish that
increasing competition cannot decrease the amount of information revealed, and will in a certain sense
tend to increase it.

What a great challenge: To put the two papers together as “The War On Truth – How Mercenary Macroeconomists Compete to Persuade Rational Voters.”

gymquiz September 19, 2011 at 4:48 pm

I still remember when you could dial a number and get “time and temperature” after hearing a small ad. There was actually a time in my life when two guys in my city had a service that was LIVE. They would actually read the little ad, then look at a clock and tell you what time it was. That business didn’t last long though.

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