Month: May 2009

Textbook Contest – Results

Many thanks for all the excellent suggestions for an epigraph for Modern Principles.  Here were some of our favorites:

"He tried to read an elementary economics text; it bored him past
endurance, it was like listening to someone interminably recounting a
long and stupid dream."

Ursula K. Le Guin, "The Dispossessed"

We liked that this has an exoteric and esoteric meaning but we suspect that it would be hard to get past "the Corporation."  (The esoteric meaning?  The novel is about a communist utopia so it's really no surprise that the characters (and the author) think that elementary economics texts are boring!). Suggested by Dave C.

"Competition is good for consumers."
N. Gregory Mankiw

Suggested by Eli Dourado.

"Economics is really about understanding the world — and changing it
— and not in a messianic fashion but in an honest fashion."
James J. Heckman

A close one.  Suggested by Jared.

Advertise Here.
Suggested by Alex Tabarrok.

I liked it!

And the winner is:

Economics is the study of how to get the most out of life.

I thought this phrase, which was suggested by Scott Gustafson, captured the joie de vivre and the love of economics that Tyler and I have tried to bring to Modern Principles.  It's unclear who said this first, although nicely for us Russ Roberts used this phrase to describe Tyler's book Discover Your Inner Economist, thus there is some history.

Thanks everyone for your many helpful and excellent suggestions!

Markets in everything

Steve Horwitz reports:

This is a great article on
today about companies that will take care of your "digital assets"
after you die.  You pay them a fairly small fee and they keep track of
all your email ids/passwords, bank accounts, etc. so that your loved
ones can have access to them if you die without leaving all that
information behind.  They promise to store them securely of course.

Randomized monetary policy

Felix Salmon writes:

One alternative approach would be to consider it to be the job of the Fed to minimize the severity of the worst possible
recession. What would happen if, for instance, rates were set using a
random-number generator? Every FOMC meeting, some kind of virtual die
would be rolled, moving rates up or down even if that was the opposite
of “correct” monetary policy. The resulting uncertainty would force
people to take a more defensive stance at all times, just in case rates
went sharply upwards – even if the probability of such a rate hike was
quite low.

Some Austrian wise guys out there might claim this is what we had for a while or maybe they think it is what we have now.  Alternatively, if returns on gold are a random walk, does not a commodity standard give you a version of this, if only for medium-term changes in the price level?  Random taxation of risky investments could produce comparable results.

In the absence of transactions costs…

When you take most three-year-olds shopping, they're happy if you buy them a
new doll.

Not Pipi Quinlan.  When she got on to her parents' computer, she ended up with
a $NZ20,000 (£8,000) mechanical digger.

The first thing Pipi's parents, who live in Auckland, knew of their child's
expensive acqusition was when her mother Sarah logged on to her computer and
found a series of e-mails from the New Zealand Trade Me auction site
congratulating her on her buy.

The toddler who usually prefers high-heeled pink shoes over giant yellow and
black diggers, had woken early and started playing on the computer while her
parents were asleep.

After a couple of clicks on the mouse, she entered the NZ internet auction
site Trade Me which her mother had logged on to earlier.

And so on.  Here is the story.

Languages in everything

Wikipedia remains impressive and it outlasts its critics:

The Basque-Icelandic pidgin was a pidgin spoken in Iceland in the 17th century. It developed due to the contact that Basque traders had with the Icelandic locals,[1][2] probably in Vestfirðir.[3] The vocabulary was heavily based upon the Labourdin Basque language, but also in an Atlantic pidgin with Romance and English influences.

It is documented in two glossaries found around 1905 by Jón Helgason in the Arnamagnæan Collection of the University of Copenhagen:[3][4] Vocabula gallica ("French words") and Vocabula biŠ¿caïca ("Biscayne words"). Helgason brought them to the attention of Christianus Cornelius Uhlenbeck, a versatile linguist from the University of Leyden
with an expertise in Basque. His post-graduate student, N.G.H. Deen,
traveled in 1927 to the Basque Country to collaborate with Julio de
Urquijo on the research that Deen published as his doctorate thesis in
1937. The manuscripts were sent back to Iceland in 1986, but one of
them was lost.

I thank darling Yana for the pointer.  It almost sounds like something from a Borges story…

A simple theory of why Catalonia will not become an independent nation

I saw the political bigwigs here give public speeches.  Normally they go to great care to promote the use of the Catalan language, including by legal means if necessary.

Yet when speaking here in their own Barcelona, in front of the King of Spain, those same bigwigs use the Spanish language, albeit with random Catalonian sentences thrown in or used to close the talk.

Apparently they do not wish to displease the King or force him to wear a translation headset.

If I apply some very naive versions of signaling theory and coalition-building economics, I arrive at the prediction that these people do not intend to secede.

Paraguay fact of the day

This was from an English-language version of El Pais, tucked into my IHT; I don´t see the story on-line:

Official estimates state that seven out of 10 children in Paraguay are only registered with their mother´s last name — in Mexico the rate is one out of six.

A bit of googling turns up a second and related estimate, namely that in Paraguay 6.5 children out of ten are not registered to receive social services.

Markets in everything

Here is one tidbit of several:

PET PORTE On those TV programs showing funny home videos, there’s
always a family finding a dog or raccoon stuck in their cat door. The
Pet Porte, $156 ( uses the radio frequency from the
microchip already embedded in your cat (or small dog) to ensure that
furry crashers stay out. The clear, plastic door remains locked until a
sensor reads your pet’s microchip.
Pet Porte works only with European microchips; this autumn, the company will release a door that can read U.S. chips. Light sensors allow you to program the door to lock after certain hours so your kitty doesn’t go out for a nightcap.

And if you like to process information about canines, here is a new source of input:

Ever wonder if your dog walker is really giving your pup a workout? The
Snif Tag, $299 (, is the equivalent of the baby cam for
neurotic dog owners. A small tag attached to the collar uses a
three-axis accelerometer and motion sensor software to determine what
your dog is doing – walking, running, sleeping–and records the
information within the tag’s flash drive. Back at your pad, where Snif
Tag’s base station connects by Ethernet cable to your home network, all
the information is uploaded to a Web site. The site breaks down your
pooch’s activity by minute, hour, day, week, and month, and lets you
determine, by breed and age, whether or not your dog is getting enough
exercise. The tag also features a social component: When your canine
companion has interacted with another Snif Tag wearer, you can contact
the owner of your pup’s new B.F.F. to set another play date. One
problem: Finding enough owners who are willing to buy the device.

There is also:

JOG-A-DOG The easiest way to deal with destructive behavior is with
exercise, but occasionally it’s not realistic to toss the ball with
your pup (long work hours, snowstorms, laziness). Doesn’t mean you
can’t wear your dog out. Joga- Dog, $1,195 and up ( is a
treadmill designed with canines in mind. Side guardrails ensure your
dog doesn’t escape his workout, and an 11- degree incline is said to
provide the resistance needed to build strength and muscle. But like
with human treadmills, the Jog-a-Dog is no substitute for the stimuli
of the great outdoors.

China do-over fact of the day, markets in everything minus one

Love Land,
a sex theme park set to open this October in China won't have the
chance to lose it's virginity. Chinese bureaucrats ordered the park
destroyed after details of the park's featured attractions were leaked.

The story is here.  The rest of the article relates:

The park was to have giant-sized reproductions of male and female
anatomy, and offered lessons in safe sex and the proper use of condoms.
There was also an exhibition about the history of sex, as well as
workshops offering sex techniques.

The entrance to park featured
a giant pair of women's legs clad only in a red thong. Those legs are
now closed forever. Officials would only say that the concept of the
park was vulgar, and deemed unnecessary. Bulldozers and wrecking ball
were seen destroying the exhibits as onlookers tried to get a peak.

China considers the topic of sex taboo, even though illegal prostitution is at an all-time high in the country.

Toward a theory of “Assorted links”

Brad DeLong and Matt Yglesias, trendsetters of the blogosphere if there were any, are assembling "assorted links" once a day or so.  As do I and Yves Smith, not to mention the Herculean efforts of Mark Thoma.

Does anyone click on these things or do you simply wish to feel you have experienced a more comprehensive menu of what you have refused to learn?

A second-order question is whether or not I should care about the answer to the first query.

Small steps toward a much better world, a continuing series

Remember that guy Hayek?  Or is it Walras?

The San Francisco Giants are experimenting with a possible solution – software that weighs ticket sales data, weather forecasts, upcoming pitching matchups and other variables to help decide whether the team should raise or lower prices right up until game day.

The story is here and I thank the excellent Michael Makowsky for the pointer.