Philosophy

Could it be the lengthy NYT profile of Stevenson and Wolfers?  Other than finding material on economists interesting per se, and knowing them a bit, I found this profile relevant for two reasons.  First, successful economists really can earn a good amount these days, and at relatively young ages.  They could probably earn much more, if that is what they set out to do.  Second, there really is a cognitive elite engaged in assortative mating, and the children of those couples will have a big head start.  Furthermore that cognitive elite is now global (Justin is from Australia).  No, Murray’s econometrics do not demonstrate all of his conclusions, but nonetheless this family is a walking embodiment of The Bell Curve, not to mention the new book.  (I would have preferred a piece which explored this irony with more depth.)  Some of you are negative in the comments on my post, but the facts about the Wolfers/Stevenson family are hardly exceptional, conditional on a few other variables but of course strongly conditional on those variables.  They own a Noguchi table, we own a Noguchi lamp (cheaper than you think, by the way).  They ban sugar, we do not, but there is no junk food, sugary or otherwise, kept around our house.  My professional writing rails against junk food.  I was disappointed that their nanny has only a Master’s degree.  The nanny in our family has a Ph.d and is a well-known economics blogger.; going back in time, the two other nannies were a professional linguist and translator and an engineer (they are sometimes called “the grandparents”).  Get the picture?  The rhetoric in the profile is oddly non-self-conscious, perhaps in a way that makes the couple look less charismatic than they really are, and that too is worth thinking about.  Parts of the profile felt like a bit of a slog to me (despite my interest in the topic), but I suspect not to most NYT readers, and of course we are seeing a highly skilled and experienced journalist at work along with a first-rate team of editors.

Always try to give things the more subtle reading.

Dostoyevsky

by on February 8, 2012 at 12:46 pm in Books, History, Philosophy, Religion | Permalink

Ken writes:

I was scouring your blog for Fyodor Dostoevsky and was surprised to see no mentions. I was just wondering your thoughts on him. Currently reading the Brothers Karamazov and it’s fantastic.

Brothers Karamazov spent seven or so years as my favorite book, starting in high school.  I’m not suggesting it is juvenile, only that I find it hard to go back and enjoy things at lower levels than I did before (I also don’t like to eat in still-good but declining restaurants).  I no longer find Notes from Underground interesting, as I regard its questions as a dead end.  I’d sooner reread Pascal.  I never got through The Idiot or Demons in the first place.  About two years ago I read House of the Dead and liked it, though it felt like a respite from the more typical conception of Dostoyevsky.

How much can you like Dostoyevsky anyway?  My sense is that he is probably underrated as a pure writer (much of it comes across as garbage in English translation, but perhaps is quite biting or comic or interestingly manic), and overrated as a source of the “novel of ideas.”

If you enter “Dostoyevsky” into the search function of Twitter, you don’t come up with much interesting these days.

It is a wide-ranging dialogue with Timothy Snyder, you can buy it here.  I will gladly recommend this book, but I have mixed feelings about it.  It is Judt’s “deathbed conversations” with Snyder, when he was paralyzed.

Is it fascinating?  Yes.  Did I read it straight through without pausing?  Yes.  Did I learn a lot?  Yes.

Yet it doesn’t show Judt in such an overwhelmingly favorable light.  He is cranky, unfair to his intellectual opponents, and he repeatedly misrepresents thinkers such as Hayek on some fairly simple points.  He conducts unsubstantiated attacks on various New York Times columnists, as if they had once beaten him in a debate and this was his revenge.  It shows his lifelong and mostly unhealthy obsession with what Daniel Klein has called “The People’s Romance.”  Unlike in some of his previous writings, his proposals for a one-state solution to the Israel-Palestine problem come off as an irresponsible and somewhat flip symbolic gesture, easy enough to make because he doesn’t have to live with the outcome.  As a reader and reviewer it is hard to not wonder whether/how Judt was medicated during these conversations, and how well he had thought through his lack of editing options before publication.  Or is this the real Judt?  Are we all really like this?  Pondering that question is as interesting as the dialogue itself.

The Austrians will be happy when Judt writes: “The three quarters of century that followed Austria’s collapse in the 1930s can be seen as a duel between Keynes and Hayek.”  Yet he has the odd view that free market ideas were “imported to the U.S. in the suitcases of a handful of disabused Viennese intellectuals.”  Others may underrate the importance of central/eastern Europe but in these dialogues he overrates it.

One does not have to agree with Hayek’s Road to Serfdom to find this an unfair characterization:

Hayek is quite explicit on this count: if you begin with welfare policies of any sort — directing individuals, taxing for social ends, engineering the outcomes of market relationships — you will end up with Hitler.

My favorite part of the book comes at Kindle location 1294, here is part of that discussion:

But even when Blunt was outed as a Soviet spy, in 1979, his standing in high society, and in the distinctive codes of that society in England, still protected him…Thus Blunt — a spy, a communist, a dissembler, a liar and a man who may have actively contributed to the exposure and death of British agents — was nonetheless deemed by some of the his colleagues to be guilty of no crime serious enough to justify depriving him of the fellowship of the British Academy.

If you are seeking to “normalize” this review, I consider Judt’s Past Imperfect to be one of the best books of the last few decades, his Postwar to be one of my favorite books ever, and his late essays to be some of the best writing, in any genre, in a long time.  (Though I didn’t like Ill Fares the Land.)  I can recommend this too, as something worth consuming and pondering and spending money on, but I still have a slightly queasy feeling in my stomach.

The West Rt. 50-Gallows feed

by on February 4, 2012 at 5:39 pm in Law, Philosophy | Permalink

There are three lanes, with the left two lanes narrowing into one.  A slight bit further ahead, the traffic from Gallows Road merges into the right lane, map here.

Many people from the far left lane merge “unethically,” driving ahead as far as they can, and then asking to be let in at the near-front of the queue.  The traffic from Gallows Road, coming on the right, merges ethically, as it is a simple feed of two lanes nto one.  They have no choice as to when the merge is, although de facto the construction of the intersection puts many of them ahead of the Rt.50 drivers.

The left lane merge is slightly quicker than the right lane merge, in part because not everyone is an unethical merger.  Yet it is more irksome to drive in the left lane, because you feel, correctly, that people are taking advantage of you (unless you are an unethical merger yourself, which I am not).

In recent times, I have switched my choice to the right lane.

“How deserving are the poor?”

by on January 27, 2012 at 11:46 am in Philosophy | Permalink

Next Wednesday night, Bryan Caplan will debate Karl Smith on that topic at GMU.  For background, here is a relevant short essay by Karl.

From the perspective of “common sense morality,” the poor, in wealthy countries at least, are responsible for quite a bit of their difficulties.  I believe Bryan stresses this factor, although I am less sure how he treats common sense morality when he disagrees with it.

Yet other perspectives must be brought to bear.  There is determinism, at differing levels, ranging from “it’s tough to come from a broken home” to “lead poisoning is bad for you” to “what if the universe is a frozen four-dimensional Einsteinian/Parmenidean block of space-time?”  (Ethics does look different when you are traveling at the speed of light.)

There is the view that desert simply is not very relevant for a lot of our choices.  We still may wish to aid the undeserving.  Matt Yglesias adds relevant comment.

What about utility?  Corrupt societies are inefficient, frustrating, and infuriating, but is more meritocracy utility-enhancing at all margins?  I doubt it.  Chess is a relative meritocracy, with clear standards for performance and achievement, but I am not sure that chess players as a whole are happier for this.  Some ambiguity in one’s level of achievement can be socially useful and somewhat of a relief at the personal level.  Life in a sheer meritocracy would be psychologically oppressive.

What about multiple equilibria and self-fulfilling prophecies (pdf, very interesting paper at first glance I have not read it yet)?

The goal of discussions of desert is to improve on common sense morality, without straying so far from it that the proposed reforms are unworkable or unsustainable.  Views on merit and desert are also incentives, and they must slot into *someone’s* common sense morality if they are to be applied and carried forward.

In this area, it is easy to stomp on the views of other people.  It is harder to synthesize these factors, and others, in a way that is defensible or even explicable in terms of a coherent approach.  Where does the commensurability across the different factors come from?  How much room or slack does common sense morality give us to operate at all?

What if we turned out not to deserve meritocracy?  What would then be the meritocratic thing to do?

If we are living in a simulation, does that resolve the Fermi paradox?  I would think so.  The “aliens” would be here, we just would not “see” them as such.  But in fact we would be looking at nothing but the alien products, namely the creators of the simulation.

Should we expect to find alien civilizations in a simulation?  The priors are not so clear: do the simulation creators want full Bayesian realism?  Is the universe run by an alien version of Daniel Kahneman?  The simulation has not excluded animals, but it has (so far) excluded self-replicating von Neumann probes or the use of supernovae as alien corporate advertisements.  The simulation still might have alien civilizations turn up in ways which do not make Bayesian sense, but which add to the drama.  For the time being, we are still in a “no aliens” do loop.

I thank Jim Olds for a conversation related to this topic.  In any case, the Fermi paradox raises the likelihood that we are living in a simulation.

Addendum: Robin Hanson comments, as does Jim Olds.

By mobility I mean whether people are crossing into different income quintiles or deciles than the ones they were born into, or the ones they enjoyed at an earlier period of life.

1. If the general standard of living is rising (and I am more than willing to admit problems in this area for the United States), mobility takes care of itself over time.  I find it more useful to focus on slow growth, if indeed that is the case.  Just look at income growth for non-wealthy families and that is more useful than all the mobility measures put together.

2. Measured mobility in the United States does not seem to be falling, or at least not falling much, as shown by Scott Winship.

3. For a given level of income, if some are moving up others are moving down.  Do you take theories of wage rigidity seriously?  If so, you might favor less relative mobility, other things remaining equal.  More upward — and thus downward — relative mobility probably means less aggregate happiness, due to habit formation and frame of reference effects.

4. Why do many European nations have higher mobility?  Putting ethnic and demographic issues aside, here is one mechanism.  Lots of smart Europeans decide to be not so ambitious, to enjoy their public goods, to work for the government, to avoid high marginal tax rates, to travel a lot, and so on.  That approach makes more sense in a lot of Europe than here.  Some of the children of those families have comparable smarts but higher ambition and so they rise quite a bit in income relative to their peers.  (The opposite may occur as well, with the children choosing more leisure.)  That is a less likely scenario for the United States, where smart people realize this is a country geared toward higher earners and so fewer smart parents play the “tend the garden” strategy.  Maybe the U.S. doesn’t have a “first best” set-up in this regard, but the comparison between U.S. and Europe is less sinister than it seems at first.  “High intergenerational mobility” is sometimes a synonym for “lots of parental underachievers.”

5. How much of immobility is due to “inherited talent plus diminishing role for random circumstance”?  Is not this cause of immobility very different — both practically and morally — from such factors as discrimination, bad schools, occupational licensing, etc.?  What are you supposed to get when you combine genetics with meritocracy?  I do not know how much of current American (or other) immobility is due to this factor, but I find it discomforting that complaints about mobility are so infrequently accompanied by an analysis of this topic.

6. I am more than willing to hear arguments than a less mobile society is a less stable society, or otherwise a society which makes worse political decisions.  But I haven’t seen serious arguments here.  By “serious arguments” I mean those which take endogeneity into account and go beyond noting that Denmark is a better polity than Brazil, and so on.

7. I would like all measurements in this area to take into account the pre-migration incomes of incoming entrants.  Denmark, which doesn’t let many people in, is a much less upwardly mobile society once you take this into account.  Sweden deserves more praise, and in general this factor will make the Anglo countries look much, much more supportive of mobility.

Addendum: Here is more from Scott Winship.

Remember those old debates on MR as to what opportunity cost is exactly supposed to mean?  Joel Potter and Shane Sanders have an interesting follow-up paper:

Abstract: Ferraro and Taylor (2005) asked 199 professional economists a multiple-choice question about opportunity cost.  Given that only 21.6 percent answered “correctly,” they conclude that professional understanding of the concept is “dismal.” We challenge this critique of the profession. Specifically, we allow for alternative opportunity cost accounting methodologies—one of which is derived from the term’s definition as found in Ferraro and Taylor— and rely on the conventional relationship between willingness to pay and substitute goods to demonstrate that every answer to the multiple-choice question is defensible. The Ferraro and Taylor survey question suggests difficulties in framing an opportunity cost accounting question, as well as a lack of coordination in opportunity cost accounting methodology.  In scope and logic, we conclude that the survey question does not, however, succeed in measuring professional understanding of opportunity cost.  A discussion follows as to the concept’s appropriate role in the classroom.

Fred Smalkin has two questions

by on January 13, 2012 at 4:31 am in Economics, Philosophy | Permalink

This is great. I have two requests (for Tyler or anyone who may have some answers):

1. Could you address the idea of preference preferences? It strikes me that psychoactive drugs alter one’s utility function. Can that be modeled, or does that put you in non-linear-dynamical-system territory that doesn’t admit functions as we know them?

2. Am I being overly simplistic in this stripped-down political model? It seems to me that ideal welfare would measure your lifetime productivity at birth and then compensate you to the extent that it falls below $X. Obviously this comes at some cost, but it seems to me that a consequence of Arrow’s impossibility theorem is that there’s no political solution to choosing X (and how the cost of X would be distributed).

Thanks to Tyler and all who can shed some light!

When it comes to meta-preferences, it is usually acceptable to assume convergence through a fixed point theorem.  So whether I have a preference for a preference for a preference, etc. comes to a coherent finish and we can speak meaningfully of meta-preferences.  That said, I don’t see why we should always favor the meta-preference over the (“baser”) preference.  “Wanting to listen to Top 40″ is not obviously a worse preference than “wishing I enjoyed opera more.”

The second question refers to a longstanding debate in optimum taxation theory.  There are a few reasons why we don’t grant transfers contingent on ability alone.  First, we may find the outcomes of privately accepted gambles unacceptable and wish to grant aid to the losers.  Second, there is sometimes a higher social rate of return from investing more money in the skilled.  A final question is why we make so many transfers near or at the end of life and so few, relatively speaking, at the beginning of life.  Obviously the elderly vote at a high rate but I don’t think it is just that.  There is a more general intuition that the elderly deserve the aid and the young do not to an equal extent.  That intuition is a big obstacle to fiscal balance.

The subtitle is Moral Ideals and the Nature of Practical Reasoning.  Without hesitation I paid full price for this book, in this case $74 though since then the price is falling.  While not an easy read, it is the most important work in choice theory and social choice in some time.

Why does the transitivity debate matter?  If you believe in transitivity, you will see lots of piecemeal improvements as adding up to something desirable.  If you do not believe in transitivity, useful normative inquiries have to be much more global.  You will put less weight on the Pareto principle, and less weight on partial equilibrium cost-benefit analyses.  You will focus on what constitutes a good society, and you will trust some very gross macro comparisons (“America is better than Albania”) more than micro comparisons (“the best system of taxation is X”).

If you are skeptical of transitivity as a postulate, you probably are less inclined to see individuals with intransitive preferences as irrational.  This may affect your views on paternalism and time inconsistency.

Many economists of course view the rejection of transitivity as simply unthinkable.  Perhaps without transitivity we cannot even speak of the notion of a coherent preference.  Temkin is skeptical of transitivity.  There are a few versions of anti-transitivity arguments:

1. A version of Arrow’s theorem will apply to plausible versions of pluralistic moral reasoning, just as it applies to decathlon scoring.  Temkin does not pursue this route, though he notes in the introduction it may be possible.  It is the route I would have preferred, as it makes the investigation more economical.

2. The Sorites paradox, or how many stones make a pile.  Temkin insists his argument does not boil down to the Sorites paradox, though one may add this to the pile of arguments against transitivity.

3. The “roughness” relation: maybe Mozart is roughly as good as Beethoven, but this need not be transitive.  Possibly Haydn is roughly as good as Mozart, but it does not follow that Haydn is necessarily “roughly as good” as Beethoven.  Often judgments about the good are rough by their nature.

4. Various pairwise comparisons lead the transitivity advocate to unacceptable conclusions.  For instance you can start with the view that adding a pain to the world is a bad, and (with intermediate steps), end up having to believe that adding a very very slight pain for a trillion lives is worse than brutally torturing ten people.  Or perhaps you are familiar with Derek Parfit’s Mere Addition Principle.  If you endorse some pairwise comparisons which increase both utility and equality, you can again be led to apparently unpalatable conclusions by some multi-stage comparisons (pdf, it would take a long time to explain here).  Temkin stresses this kind of argument and works through the possible responses in great detail.

The main contribution of this book is to show you that the transitivity postulate is far less intuitively appealing than it seems at first.  Twenty-two years ago I disagreed with Temkin but now I accept much of his critique.  Here is one very good Temkin piece from JSTOR.

These days, I see the good is more holistic than additive-aggregative.  This defuses Temkin’s arguments, though at a high cost.  (You will find Temkin’s criticisms of holism and related ideas at around p.355, though I find them unusually lacking in force.  One of his worries boils down to how a multiplicative view will handle negative numbers but I see the scale as sufficiently arbitrary that they need not pop up to begin with.)  We can make some gross comparisons of better and worse at the macro level, with partial rankings at best, but for many individualized normative comparisons there simply isn’t a right answer.  I view “ranking” as a luxury, occasionally available, rather than an axiomatic postulate which can be used to generate normative comparisons, and thus normative paradoxes, at will.  I see that response as different than allowing or embracing intransitivity across multiple alternatives and in that regard my final position differs from Temkin’s.  Furthermore, in a holistic approach, the “pure micro welfare numbers’ used to generate the paradoxical comparisons aren’t necessarily there in the first place but rather they have to be derived from our intuitions about the whole.

These thoughts provide one reason — though by no means the only reason — why I think so many policy comparisons are not very clear cut, not even in principle, not even if we had better empirics.

My main objection to this book is how it was written.  It is too long and too branching, much like Parfit’s recent volumes.  Temkin notes that Shelley Kagan, a very smart guy, gave him 117 pages of single-spaced comments on a prior manuscript draft.  Temkin took that as an invitation to lengthen the presentation rather than shorten it.

Addendum: If you are interested in these issues, you also should read Leo Katz’s new and fascinating book, more applied than Temkin’s, also rejecting transitivity as a universal principle of reasoning but focused on explaining the content of the law and its apparent paradoxes.

Further response from Krugman

by on January 4, 2012 at 9:25 pm in Philosophy | Permalink

You can read it here, and keep in mind that not leaving a comment is very often a good option!

Krugman’s response to Alex

by on January 3, 2012 at 3:13 pm in Philosophy | Permalink

You’ll read it here, see also various (mostly weak) responses in the comments to Alex’s original post.  Most of you, including Krugman, are missing Alex’s point.  The issue is not that Krugman changed his mind (I’ve done that plenty, Alex too).  The issue is that Krugman a) regularly demonizes his opponents, including those who hold Krugman’s old positions, and b) doesn’t work very hard to produce the strongest possible case against his arguments.

Krugman’s response shows that he has changed his mind on debt, and explained why, but Heritage has not.  It’s an “I am better than they are” response.  That is beside the point, which is about elevating the views of others not oneself.  The need to show all the time that one is better or more right than the others is itself harmful to depth, and responding with “but I really am better than them” is just falling into the trap again.

Krugman calls himself a Humean but has he studied and internalized the lessons from Hume’s Dialogues Concerning Natural Religion?  Is it easy to imagine the current Krugman writing rich multi-voiced dialogues which extend both his points and those of his intellectual opponents?  Can you imagine the current Krugman writing something sufficiently multi-faceted that you might come away thinking — because of the piece itself — that the opposing point of view was the better one?

Krugman has shown a remarkable and impressive capacity to reinvent himself, more than once.  He could reinvent himself again — in a truly Humean direction — and become the most important American public intellectual — and perhaps intellectual — of his time.  Or he could keep his current status as a sharp and brilliant someone who has an enormous number of followers but relatively little influence over actual events, and perhaps, like most of us, won’t be read much fifty years from now.

The reality is that neither the early nor the more recent Krugman is especially convincing on debt, and if anything the conjunction between the two shows that switching sides isn’t quite the same thing as changing your mind.  The odds are that government spending cuts are not literally budget balance destroyers on net.  How about writing a NYRB essay that lays out the short-run negative output gradient to austerity, presents why austerity is considered a serious option nonetheless, discusses catch-up and bounce back effects and their relevant time horizons, analyzes what kinds of policies are actually possible in a 17 (27) nation collective, engages with the best public choice arguments (including Buchanan and Wagner) on a serious level, ponders the merits and demerits of worst case thinking, and ruminates on the nature of leadership in a way which shows some tussling with Thucydides and Churchill?  Surely that is within Krugman’s capabilities and if it still comes out Keynesian or left-wing, great, at least someone will have seen those arguments through.  Such an essay would stand a far greater chance of influencing me, or other serious readers, or for that matter President Obama.  We should hold Krugman to the very high standard of actually expecting that he produce such work.  Not many others are capable of it.

There is a kind of hallelujah chorus for Krugman on some of the left-wing economics blogs.  The funny thing is, it’s hurting Krugman most of all.

Addendum: Here is a response from Krugman; note he has turned my description of “regularly demonize” to “always demonize.”

The link and pointer come from Ben Casnocha, here is one excerpt (emphasis is from Ben):

…as a general rule, we’re too inclined to tell the good vs. evil story. As a simple rule of thumb, just imagine every time you’re telling a good vs. evil story, you’re basically lowering your IQ by ten points or more. If you just adopt that as a kind of inner mental habit, it’s, in my view, one way to get a lot smarter pretty quickly. You don’t have to read any books. Just imagine yourself pressing a button every time you tell the good vs. evil story, and by pressing that button you’re lowering your IQ by ten points or more.

One interesting thing about cognitive biases – they’re the subject of so many books these days. There’s the Nudge book, the Sway book, the Blink book, like the one-title book, all about the ways in which we screw up. And there are so many ways, but what I find interesting is that none of these books identify what, to me, is the single, central, most important way we screw up, and that is, we tell ourselves too many stories, or we are too easily seduced by stories. And why don’t these books tell us that? It’s because the books themselves are all about stories. The more of these books you read, you’re learning about some of your biases, but you’re making some of your other biases essentially worse. So the books themselves are part of your cognitive bias. Often, people buy them as a kind of talisman, like “I bought this book. I won’t be Predictably Irrational.” It’s like people want to hear the worst, so psychologically, they can prepare for it or defend against it. It’s why there’s such a market for pessimism. But to think that buying the book gets you somewhere, that’s maybe the bigger fallacy. It’s just like the evidence that shows the most dangerous people are those that have been taught some financial literacy. They’re the ones who go out and make the worst mistakes. It’s the people that realize, “I don’t know anything at all,” that end up doing pretty well.

The talk itself is here on video.

They only look like baby pandas.

These little bundles of joy are actually chow chow dogs that have been dyed black-and-white to look like pandas.

Dyeing pets has been a trend in pet pampering for quite some time. At last summer’s Pets Show Taipei, there was a fierce dog-dyeing competition. Check out photos.

But dyeing your pets to look like other wild animals is a more recent development.

The full story is here and for the pointer I thank this guy.  Don’t miss the other photos at the link, for instance:

And:

I’ll put a few of these under the fold… Read More →