Month: May 2005

Why has crack caused so much crime?

Relative to other drugs, that is.  In a CrookedTimber symposium on Steve Levitt, I offer a few speculative and possibly false hypotheses:

1. Heroin and pot make you sleepy.  Crack gets you riled up.

2. Crack was a new drug when it hit the market.  Gangs were competing to hook new buyers.  This is a far more violent activity than serving established drug clientele.

3. In dollar terms crack was a "bigger" drug than ever before.  The gross and the profit margins were bigger.  The resulting turf wars over profits led to murders.  It is not worth killing people over a few marijuana sales.  (Yet still I find this puzzling.  Falling prices have taken profits out of the market; the gangs must either have had an extraordinarily high discount rate or they behaved irrationally in killing each other.  In the latter case we have no economic explanation at all for the hike in crime.)

4. Perhaps you buy other drugs from your friends, but you buy crack from dealers.  (Most people get Ecstasy from their friends, and this market is not very violent.)  The new question is then why this might be.  Could crack somehow require less personal certification from trusted acquaintances?

Here is my full post.  I have opened up comments for your ideas.  Contributions from economically literate and (previously) violent crackheads are especially welcome.

Markets in everything — gross me out version

Hufu:  The Healthy Human Flesh Alternative!

This is from the FAQ:

What does Hufu TM taste like? Does it taste like human flesh?
HufuTM is designed to resemble, as humanly possible, the taste and texture of human flesh. If you’ve never had human flesh before, think of the taste and texture of beef, except a little sweeter in taste and a little softer in texture. Contrary to popular belief, people do not taste like pork or chicken.

Who actually buys HufuTM?
HufuTM was originally conceived of as a product for students of anthropology hungry for the experience of cannibalism but deterred by the legal and logistical obstacles. However, our preliminary market research revealed the existence of a larger segment of the public that was interested in the availability of a legal and healthy human flesh substitute.

But if you wish to feel better (worse?) about the whole thing, the CEO and cook admits he has never sampled human flesh.  I believe this to be tofu plus a clever marketing idea.

Thanks to John Wilson for the pointer. 

The Secret to a Good Marriage? Delusion

At lunch the other day Robin Hanson offered a perceptive comment on marriage and divorce (I paraphrase).

We tend to remember slights and frustrations more than favors and kindnesses.  So inevitably in a marriage the weight of negative remembrances of thing past comes to exceed that of the positive.  Divorce is the result.

The secret to a good marriage, therefore is selective forgetfulness.  Coincidentally some psychologists have recently come to the same conclusion.  The couples who stay together are the delusional ones – the ones who look at their past with rose-colored glasses.

Psychologists believe that what they are observing in couples who endorse these and similar sentiments are strongly selective memories that ignore inevitable negative events over the course of marital history. Maybe a distorted view of your marriage that emphasises the positive and forgets the negative is crucial to accounting for who stays and who flees when it comes to relationship endurance.


A kindred spirit is someone who appears especially to understand us and uniquely share our experiences, probably because they see the world they way we do and are therefore, in important respects, just like us.

Murray’s group measured marital partners’ personalities, values and day to day feelings and compared these to marital satisfaction. Those in the happiest and most stable marriages were those most likely to believe their partners were most like them – that is, "kindred spirits" – even when objective comparison of personality found that the similarity was much more imagined than real.

Meanwhile Bryan over at EconLog offers some useful ideas on how to remember and how to forget.

Underappreciated economists, a continuing series

Jesse Shapiro.  Yes, he is a mere Youngling, having just finished his Ph.d. at Harvard (he was a Shleifer student, and now visiting at Chicago).  But he is likely to be one of the leading economists of the next generation.  He studies why and how large numbers of people can make, or appear to make, systematic errors.  This is perhaps the frontier question in contemporary economics.  Here is the abstract from Jesse’s paper on advertising:

I present a model of advertising in the presence of bounded memory and limited recall.  In the model, consumers’ memories record the quality of their experiences with a product.  Exposure to advertising leads to memories of good experiences.  Crucially, I assume that consumers cannot recall whether a memory orginates from a genuine consumption experience or from exposure to advertising.  The model yields several novel implications.  First, advertisers will concentrate their efforts on past customers, because experienced consumers will be more likely to trust that their positive feelings toward the brand are genuine.  The model may therefore help to explain why established, familiar brands continue to advertise extensively.  Second, the firm’s desire to "saturate" the consumer with positive memories can lead to the commonly observed phenomenon of "pulsing," in which a firm oscillates between no advertising and some positive amount.  Third, exaggeration is limited, in the sense that advertisers may not cause consumers to remember haivng extraordinary experiences with the brand.  Indeed, under some conditions an equilibrium in which advertising conveys the best possible impression of the brand can exist only when the total amount of advertising is small.

Another paper of Jesse’s challenges analytical egalitarianism — the entire foundation of economics.  Here is a previous installment of underappreciated economists.

Five books I am embarrassed not to have read

Matt Yglesias offers his list, and Will Wilkinson passes the meme to me.  So here are my choices:

1. Summa Theologica: A classic, yes.  But I am neither a Catholic nor an Aristotelian.  Get this randomly chosen excerpt: "There is nothing to prevent a thing which in one way is divided from being another way undivided, as what is divided in number may be undivided in species; thus it may be that a thing is in one way one, and in another way many."

2. Sartre’s Being and Nothingness – This can seem intriguing when I browse it, but then I have the urge to pick up Pascal and I never come back.  I haven’t finished Heidegger’s Being and Time either, but I am not embarrassed by that fact.

3. Harry Potter, various installments – I can’t get through them, and yes I have tried the deeper and darker #3.

4. Gibbon on Rome – I read volume one, but stopped paying attention somewhere in the middle.  The main thesis — that Christianity wrecked the Roman empire — simply isn’t true, and I don’t find the prose mesmerizing, at least not in a positive fashion.

5. Cadillac Desert: The American West and its Disappearing Water.  This is the only one on the list I decided I should start reading.  It is superb and gripping, and my guilt will be gone soon.

Some people will flagellate themselves with such a list, others attack the books.  The real question is which one this exercise induces you to pick up.

How to order in a restaurant offers the following parody:

Blink by Malcolm Gladwell
Glance quickly at the menu and order whatever catches your eye first. Spend no more than 2-3 seconds deciding or the quality of your choice (and your meal) will decline.

Freakonomics by Steven Levitt and Stephen J. Dubner
The key to ordering a good meal in a restaurant is understanding the economic incentives involved. Ask the server what they recommend and order something else…they are probably trying to get you to order something with a high profit margin or a dish that the restaurant needs to get rid of before the chicken goes bad or something. Never order the second least expensive bottle of wine; it’s typically the one with the highest mark-up on the list (i.e. the worst deal).

The Paradox of Choice by Barry Schwartz
Take the menu and rip it into 4 or 5 pieces. Order from only one of the pieces, ignoring the choices on the rest of the menu. You will be happier with your meal.

The Wisdom of Crowds by James Surowiecki
Poll the other patrons at the restaurant about what they’re having and order the most popular choices for yourself.

Everything Bad is Good for You by Steven Johnson
Order anything made with lots of butter, sugar, etc. Avoid salad or anything organic. A meal of all desserts may be appropriate. Or see if you can get the chef to make you a special dish like foie gras and bacon covered with butterscotch and hot fudge. Ideally, you will have brought a Super Sized McDonald’s Double Quarter Pounder with Cheese Meal into the restaurant with you. Smoke and drink liberally.

Thanks to Chris Masse for the pointer.

Why satellite radio doesn’t make me happier

I love satellite radio.  I listen every day and did not flinch when they raised the price.  Still I cannot help but feel (boo-hoo) it was not designed with me in mind.  I am not completely happy with 70 commercial-free, DJ-driven music stations with no playlists. 

The culprit lies in how the channels are defined.  They have a station for "50s music," or "bluegrass," or "reggae."  They need clear and compelling channel titles to attract subscribers.  And with so many channels at hand, many listeners wish to know what is where when. 

But I don’t care so much about genre or time period per se.  Let’s face it, most music from the 1960s is unlistenable.  I love the best of Jamaican music, but most reggae stinks.  A station that has to cover a genre or time period gives you, in lieu of a least common denominator problem, too many denominators at once.

I would rather have 70 channels with the liberty of experimenting across all possible dimensions.  Even better, how about defining channels by IQ scores?  Number of CDs in your collection?  Personal mood that day?  Best yet, a station: "For people who are convinced that James Brown, Sun Ra, Fela Kuti, Lee Perry, and Pierre Boulez are seminal musical figures of our time."

That is why I am not happier with satellite radio.  I hope soon to relate my experiences with Internet radio and podcasting.

Angry Bear is Happy about Globalization

Kash at Angry Bear, a left of center economist, writes eloquently on trade and economic integration:

I’m not sure why we care more about economic integration than other
types of economic change. Every time there is a technological
innovation, some people benefit but others lose. Every time a person
decides to patronize one store over another, some people benefit but
others lose. Every time any economic transaction happens, in fact,
there are winners and losers. Why does it make a crucial difference
whether or not that transaction happened to cross a national border?…

When thinking about the costs and benefits of economic integration, why
should we only consider those that apply to people in our own country?
Is there any particular reason that I should care more about the
welfare effects of economic integration on people in Lubbock, Santa
Barbara, or Chattanooga than the effects on people in Lucknow, Sao
Paolo, or Chongqing? Personally, I can’t think of any good reason why.

Me neither.  I also like Kash on the market test.

I realize that some of you are disappointed that I agree with the
orthodoxy by thinking that international economic integration is
generally a good thing, despite the fact that I call myself "liberal".
And I realize that some of you think that economists are all simply
brain-washed when it comes to international trade. But…if the vast majority of economists agree
about something, it’s not because we are simply turning off our brains
(and analytical power) on that one subject. It’s because the theory and
evidence on the subject are convincing, and have withstood relentless
efforts to debunk it. In general most economists think economic
integration is a good thing, not because it’s convenient to do so, but
because the work of thousands of extremely smart people working over
decades has convinced us that it usually is.

Arnold Kling on the returns to ability

Learning comes from taking on challenges. Entrepreneurship is a constant, in-your-face challenge. Relative to that, college is a stroll in the park.

As Graham points out, the cost of starting a business is plummeting. Given that college expenses are going the other way, [for the exceptional] the learning-to-cost ratio has shifted in favor of entrepreneurship over college.

Read more here.

More on *Sith* and fascism

…get an eyeful of the décor. All of the interiors in Lucasworld are anthems to clean living, with molded furniture, the tranquillity of a morgue, and none of the clutter and quirkiness that signify the process known as existence. Illumination is provided not by daylight but by a dispiriting plastic sheen, as if Lucas were coating all private affairs—those tricky little threats to his near-fascistic rage for order—in a protective glaze. Only outside does he relax, and what he relaxes into is apocalypse. “Revenge of the Sith” is a zoo of rampant storyboards. Why show a pond when C.G.I. can deliver a lake that gleams to the far horizon? Why set a paltry house on fire when you can stage your final showdown on an entire planet that streams with ruddy, gulping lava? Whether the director is aware of John Martin, the Victorian painter who specialized in the cataclysmic, I cannot say, but he has certainly inherited that grand perversity, mobilized it in every frame of the film, and thus produced what I take to be unique: an art of flawless and irredeemable vulgarity. All movies bear a tint of it, in varying degrees, but it takes a vulgarian genius such as Lucas to create a landscape in which actions can carry vast importance but no discernible meaning, in which style is strangled at birth by design, and in which the intimate and the ironic, not the Sith, are the principal foes to be suppressed. It is a vision at once gargantuan and murderously limited…

The two best entries to this film, and to Star Wars in general, are Milton’s Paradise Lost and the popular fascist art of the Nazis and Soviets.  The portrayal of the Jedi shows that the fascist temptation is far stronger than Milton ever believed, which is saying something. 

Most of the other episodes also should be viewed with fascistic traditions in mind.  (Otherwise you may think of them as stupid and maudlin, esp. I and II.)  Is this deliberate, or rather picked up through Buck Rogers, Joseph Campbell, and other intermediate sources?  It doesn’t matter.  Lucas’s final message is supremely anti-fascistic, and at the end of "Return of the Jedi" he presents entertaining story-telling as his preferred alternative means of enthrallment (remember the ewoks reenacting the whole story?).  But of course only a director himself enthralled with the fascistic aesthetic could make such a convincingly anti-fascistic series of movies.  That is precisely what makes the whole thing interesting, and is what most critics miss.  At least Lane gets half the picture.