Category: History

Henry Thoreau revisited

Henry Thoreau is perhaps the best-known anti-materialist thinker from the American tradition. But his life belied his formal doctrines:

The popular image of Thoreau is of the lone eccentric contemplating nature at Walden Pond. In fact, he spent only two years and two months there, and while he always preferred to be thinking and writing, he spent much of his life improving his father’s pencil business, surveying land, and otherwise earning money.

Here is the longer account, which is focused more on American attitudes toward materialism than Thoreau. Here are some of Thoreau’s passages on economy, read here also. Here is some biographical information. Alexander Pope was another author who damned commercial incentives while proving a master of them.

The glory of Athens

Politicians often refer to our Judeo-Christian heritage but in math, science, philosophy, and especially politics we owe much more to our Greco-Roman heritage. Consider; democracy, republicanism, and the rights of citizenship, these idea owe virtually nothing to the Judeo-Christian tradition and everything to Greece and Rome.

I am reminded of this by rereading Pericles’ Funeral Oration. Here, from nearly 2500 years ago, is Pericles, in the midst of war in a ceremony to honor the dead he speaks to Athens, and also perhaps to us, about liberty and war.

If we turn to our military policy, there also we differ from our antagonists. We throw open our city to the world, and never by alien acts exclude foreigners from any opportunity of learning or observing, although the eyes of an enemy may occasionally profit by our liberality; trusting less in system and policy than to the native spirit of our citizens; while in education, where our rivals from their very cradles by a painful discipline seek after manliness, at Athens we live exactly as we please, and yet are just as ready to encounter every legitimate danger.

Royal Purple

Why was purple considered the royal color? The answer lies in economics not in aesthetics. Purple is rare in nature. A Toga’s worth of Tyrian purple die, about 1.5 grams, required the beating, drying and extracting of mucus from the hypobranchial gland of some twelve thousand Murex mollusks.

Legend credits its discovery to Herakles, or rather to his dog, whose mouth was stained purple from chewing on snails along the Levantine coast. King Phoenix received a purple-dyed robe from Herakles and decreed the rulers of Phoenicia should wear this color as a royal symbol.

The practice was later adopted by the Romans; to wear purple, therefore, was to show off your great wealth. Purple is an interesting example of a snob or Veblen good because it is clear that if purple had not been expensive it would not have been greatly desired. Indeed, do we see any great demand for purple today? If purple paint were say 25 or 50% more expensive then people would switch to substitutes but make it 500 or 1000 times as expensive and it becomes a fashion statement.

The quote is from here, more information than you would ever want to know about Tyrian purple is here.

My first mentor starts blogging

Walter Grinder is a new blogger over at the libertarian Liberty & Power blog.

Meeting Walter at the age of thirteen was a formative moment in my life. Walter had been a friend of my father’s, and one night we had dinner together. Walter was (and remains) a polymath to top all polymaths. Meeting him hooked me on the world of ideas. I looked forward to each meeting with Walter more than anything else (hey, I was a nerd). I spent the whole time asking him what I should read and why. Walter is a longstanding friend of liberty and one of the world’s great teachers and role models.

Elsewhere in the blogosphere there is a new economics blog, www.divisionoflabour.com, just remember that is the British spelling. And Jane Galt has started a second blog, right now she is drawing on Mark Twain for content. Here is her explanation.

Cyclopaedia of Political Economy

Have you ever wondered what nineteenth century, classical liberal political economy looked like? No, not the classic writers but rather ordinary political economy?

A new web resource answers your question. John J. Lalor’s Cyclopaedia of Political Science, Political Economy collected classical liberal writings on the economic issues of the day, circa 1881. You can now access and read the work in its entirety. Here is information about the book and author.

For one sample, here is the brief article on the political economy of debt. Or try this entry on the balance of trade, still relevant today. The item on the division of labor remains eloquent and insightful. Gustav de Molinari writes passionately on the link between freedom, prosperity, and the arts, a favorite topic of mine. I’ve spent a good bit of time browsing through the book (both recently and much earlier), and it offers surprisingly few clunkers. On social issues it is consistently liberal and progressive.

Kudos to the ever-excellent Liberty Fund for putting the work on-line. Until their efforts, you could buy the book for a mere $675.

Addendum: The links to the previous version of this post have now been fixed.

Facts about Orkney

Sorry, no links in this post, but I am sticking to the local sources that sound credible:

1. The richest man in Orkney is (was?) a fisherman. His large net turned out to violate EU regulations, so he received $20 million from the British government to stop fishing. He is now building a house that overlooks the entire town of Stromness from above. The townspeople are not happy.

2. One-third of the employment in Orkney stems from an NHS hospital on the main island. Waiting times are significantly lower here than elsewhere in Britain and the service is correspondingly better.

3. Much of the labor force switches jobs over the course of the year. They serve tourists for three months in the summer, and pick up odd jobs the rest of the year. Work is easy to come by, careers are almost impossible to develop.

4. There have been only two murders in Orkney in the last two hundred years. One happened about two hundred years ago. The other is about ten years old; a waiter was shot and killed in Kirkwall’s Indian restaurant. Neither crime has been solved yet.

5. Orcadians eat pickled herring in oatmeal, smoked fish with scrambled eggs, and fried haddock with chips. For dessert they have Orkney fudge or Orkney ice cream. Haggis is nowhere to be found.

Here is a a tourist introduction to Orkney. Here is historical information. The islands are among the most beautiful spots in Europe and remain largely unspoilt, go if you can.

Has urban architecture declined?

Strolling the streets of Edinburgh, it is hard not to be struck by the beauty and general consistency of the older buildings. It is hard to find post World War II examples where a wealthy Western region has done something comparable. Suburbs have sprung up around the United States, but few of them have architecturally notable exteriors on a consistent basis. There are so many new suburban developments, cannot just one of them be lovely and aesthetically challenging?

What might have gone wrong? I can think of a few possible explanations:

1. Architecture has suffered from the “cost disease.” In this context, a rising general level of wages makes quality handwork more expensive in relative terms. In other words, they don’t handweave many carpets in Silicon Valley. There may be something here, but then why don’t the poorer countries of the world become architectural leaders? And I see home interiors as improving significantly over time.

2. In older times governments at various levels were less democratic. Competition for status within an oligarchy may have upped the incentive to produce beautiful exteriors. This mechanism clearly operated in Renaissance Florence.

3. Perhaps consumers and lenders were less well informed in times past. A nice exterior was a good way to signal the quality and long-term commitment of a business enterprise. Just look what happened to the quality of bank architecture in this country once the FDIC was instituted.

4. Perhaps we idealize times past. The so-called “Royal Mile” is today a leading tourist sight in Edinburgh. In the eighteenth century it was considered “a dark, narrow canyon or rickety buildings, some stacked ten or even twelve stories high, thronging with people, vehicles, animals, and refuse…Sanitation was nonexistent.” (That is from Arthur Herman’s notable book on Scotland.) We may be co-authors in the beauty of the past more than most people realize.

5. Perhaps contemporary suburban developments will be seen as beautiful by future generations. I’ll bet against this one, but we will see.

I am hardly suggesting that architecture is declining in every regard. I love the lights of the Ginza district in Tokyo. And our best stand-alone buildings are no less wonderful than those from times past. But I still wonder why urban architecture no longer yields consistently beautiful urban regions. Anyone who has walked around the major European cities, or even glanced at the Chrysler building, surely has asked the same question. Why is the quality of exteriors declining relative to interiors? Given that nice exteriors are a public good, why were they ever so nice in the first place?

How did Scotland grow so quickly?

Scotland had been an economic backwater at the time of the 1707 union with England. By 1770 at least the Scottish cities were among the most developed and intellectually advanced parts of Europe. How could this happen?

Arthur Herman supplies at least one piece of the puzzle:

…the fact that Scotland was very much the junior partner in this union also turned out to be an advantage. The new Parliament largely ignored Scotland; outbursts such as the malt riots and the threat of Jacobitism apart, the government in London paid little attention to what was happening north of the border. Scots ended up with the best of both worlds: peace and order from a strong administrative state, but freedom to develop and innovate without undue interference from those who controlled it. Over the next century, Scots would learn to rely on their own resources and ingenuity far more than their southern neighbors would…

A strong government that leaves well enough alone: this was the dual, seemingly contradictory, nature of the British state as it became part of life in post-union Scotland. Scots became used to these dualities, and learned to accept them as basic reality, just as the Union itself involved a fundamental duality: “a ship of state with a double-bottomed hull,” as Jonathan Swift put it. They also learned to think in a new way as a result of the Union: in terms of the long term.

Many economic development problems today stem from a similar conundrum. Ideally we would like a state that is both strong and not too large. Most parts of the world are unable to institute this duality; of course Hong Kong was a notable exception. I am not in general an imperialist, but the most successful instances of imperialism are likely to be highly successful indeed.

Nerd Pride

The word “nerd” appears to have been coined in 1950 by none other than Dr. Seuss. From the webpage of Eric Raymond:

nerd: n.

1. [mainstream slang] Pejorative applied to anyone with an above-average IQ and few gifts at small talk and ordinary social rituals.

2. [jargon] Term of praise applied (in conscious ironic reference to sense 1) to someone who knows what’s really important and interesting and doesn’t care to be distracted by trivial chatter and silly status games. Compare geek.

The word itself appears to derive from the lines “And then, just to show them, I’ll sail to Ka-Troo / And Bring Back an It-Kutch, a Preep and a Proo, / A Nerkle, a Nerd, and a Seersucker, too!” in the Dr. Seuss book If I Ran the Zoo (1950)… How it developed its mainstream meaning is unclear, but sense 1 seems to have entered mass culture in the early 1970s (there are reports that in the mid-1960s it meant roughly “annoying misfit” without the connotation of intelligence.

When I was a kid, no one wanted to be a nerd. Nowadays, though, nerds are “out of the closet.” People (well, guys) are proud to be nerds. Is this just part of the nerd life cycle – unpopular at 10, proudly nerdy at 33? I very much doubt it. Nerds of my dad’s generation (like, say, my dad!) wanted to fit in with regular folks, not embrace their nerdity.

Why the change? Alex Tabarrok attributes it to the rising education premium. The ratio of nerd to non-nerd earnings has gone up, and the group’s status has risen along with it. This is probably part of the reason, but I primarily credit the Internet. Communication, not economic success, is the foundation of group identity. Lots of non-nerdy sub-cultures have profited from the free-fall in the cost of social interaction. But in contrast to most other sub-cultures, nerds are virtually 100% computer literate. The Internet has been the One Ring of nerddom.

In case you haven’t guessed, yes, I consider myself a nerd. I’m such a nerd that I worry that my sons will fail to embrace their nerd heritage. The best game show in history, Beat the Geeks, began by asking each contestant “What’s the geekiest thing about you?” I still wish I could have been a contestant just to give my response:

“I am the Dungeon Master for an all-economists’ Dungeons and Dragons game.”

Beat that, geeks!

The Freedom of a Confucian

The great free-market economists and libertarian philosophers of China were not Taoists, but Confucians, according to Auburn University philosopher Roderick Long. I often say that I never doubted the value of history of thought until someone tried to convince me of it, but Long’s “Rituals of Freedom: Austro-Libertarian Themes in Early Confucianism” Journal of Libertarian Studies 17(3) is an amazingly interesting and learned paper. It is true, Long admits, that the Taoists have a few grand libertarian passages. The favorite from Lao-tzu has to be:

The greater the number of laws and restrictions,
the poorer the people who inhabit the land.
The sharper the weapons of battle and war,
the greater the troubles besetting the land.
The greater the cunning with which people are ruled,
the stranger the things which occur in the land.
The harder the rules and regulations,
the greater the number of those who will steal.
The sage therefore does not contrive,
in order to bring about reform,
but teaches the people peace of mind,
in order that they might enjoy their lives.

Tao Te Ching Section 57

Unfortunately, Long points out, a much stronger theme in Taoist is primitivist hostility to modern civilization. Listen to Lao-tzu describe the Taoist utopia:

Lessen the population. Make sure that even though there are labor saving
tools, they are never used. Make sure that the people look upon death as a
weighty matter and never move to distant places. Even though they have
ships and carts, they will have no use for them. … Make sure that the
people return to the use of the knotted cord [in lieu of writing]. … Then
even though neighboring states are within sight of each other, [and] can
hear the sounds of each other’s dogs and chickens … people will grow old
and die without ever having visited one another.

In contrast, Long finds much of value in the Confucians:

The early Confucians, by contrast, may not be as radical in
their anti-statism as the Taoists, but in my estimation they make up for this flaw by firmly
yoking their anti-statism to the cause of civilization, commerce, and the Great Society;
their overall program thus looks a lot more like contemporary libertarianism than the
Taoist program does. One Confucian text, while noting approvingly Laozi’s hostility to
despotism, sharply criticizes Laozi for wanting to “drag the present age back to the
conditions of primitive times and to stop up the eyes and ears of the people”; the best
ruler instead “accepts the nature of the people,” which is to long for “beautiful sounds
and forms,” “ease and comfort.”

The highlight of Long’s article is his discussion of the Sima Qian (c. 145-85 B.C.). Almost two thousand years before Adam Smith, Qian opined that “Wealth and currency should be allowed to flow as freely as water!” and had arguments to defend his position. And who said that Chinese intellectuals had no appreciation for the merchant class? Few Western thinkers match Sima’s appreciation of entrepreneurship:

These, then, are examples of outstanding and unusually wealthy men.
None of them enjoyed any titles or fiefs, gifts, or salaries from the
government, nor did they play tricks with the law or commit any crimes to
acquire their fortunes. They simply guessed what course conditions were
going to take and acted accordingly, kept a sharp eye out for the
opportunities of the times, and so were able to capture a fat profit. …
There was a special aptness in the way they adapted to the times …. All of
these men got where they did because of their devotion and singleness of
purpose. … [T]here is no fixed road to wealth, and money has no
permanent master. It finds its way to the man of ability like the spokes of
a wheel converging upon the hub, and from the hands of the worthless it
falls like shattered tiles. … Rich men such as these deserve to be called the
“untitled nobility” …

Murray Rothbard praised Sima in his history of economic thought, but Long notes that he neglected to mention that he was a Confucian!

It is hard to read this piece and not stand in awe of Long’s command of the Chinese literature. This is a body of thought comparable to Western philosophy in its intricacy and depth. Even if you couldn’t care less about Chinese proto-libertarians, this article exemplifies the true meaning of scholarship. And so the Sage says: check it out!

My favorite things Scottish

Favorite Scottish painting: I have to go with Henry Raeburn, check out the sense of motion in this picture.

Favorite Scottish novel: I’ve never found Stevenson or Scott very readable, so I’ll opt for Alasdair Gray’s quirky Lanark, a playful fantasy that recalls Tristram Shandy and science fiction.

Favorite Scottish music: Some of you might say Jesus and Mary Chain, but on this one I am stuck by the lack of a true favorite. This list did not much sway me. Must I go with Donovan, Garbage, Annie Lennox, or Lonnie Donegan? The bagpipes don’t do it for me, nor do Belle and Sebastian.

Favorite Scottish economist: For me this is not a no-brainer. No doubt, Adam Smith’s lifetime achievement is number one. But if you actually sat down and talked econ for a few hours, I suspect one would come away with a higher opinion of David Hume. He was, after all, the smartest person ever.

Favorite Scottish smartest person ever: David Hume

Favorite Scottish Commissioner of Customs: Adam Smith

Favorite Scottish biographer: Duh.

Favorite Scottish movie: Gregory’s Girl. This movie gives new meaning to the phrase “oozes charm.”

New claims I do and do not believe

Do Not Believe: “If intelligent life exists elsewhere in our galaxy, advances in computer processing power and radio telescope technology will ensure we detect their transmissions within two decades.” Read more here.

Do Believe: “Napoleon Bonaparte was not murdered, but was killed by his overenthusiastic doctors, according to a study of records from the emperor’s final weeks.” Read more here.

Genghis Khan and price discrimination

In twenty-five years, the Mongol army subjugated more lands and people than the Romans had conquered in four hundred years. Genghis Khan, together with his sons and grandsons, conquered the most densely populated civilization of the thirteenth century…Genghis Khan conquered more than twice as much as any other man in history…At its zenith, the empire covered between 11 and 12 million contiguous square miles, an area about the size of the African continent and considerably larger than North America…The majority of people today live in countries conquered by the Mongols; on the modern map Genghis Khan’s conquests include thirty countries with well over 3 billion people.

That’s from Jack Weatherford’s overstated but fascinating Genghis Khan and the Making of the Modern World.

By the way, the entire Mongol tribe was no more than one million people, with perhaps one hundred thousand warriors.

Today a Mongolian restaurant in London is offering free DNA testing. If you are verifiably a descendant of Genghis [what are you being tested against?], they will feed you a meal for free. The analysis takes two months, but supposedly you have a good chance of winning:

It is estimated that 17 million people worldwide, including the British Royal Family, Iranian Royalty, and the family of Dracula, are direct descendents of Genghis Khan.

Addendum: Read more here on the nature of the test.

Haitian fact of the day

In the early nineteenth century Polish soldiers went to Haiti to fight for Haitian independence against the French. Many of these soldiers stayed in the country, settling in the town of Cazale. The town has since become known for its “banana arts,” based around carving the fruit into paper-like forms.

A small Smithsonian exhibit on this history has recently been sponsored by The Republic of Taiwan

How ancient is your state?

When, pray tell, does nation building succeed? Bockstette, Chanda, and Putterman suggest an answer:

A longer history of statehood might prove favorable to economic development…for several reasons. There may be learning by doing in the way of public administration…The operation of a state may support the development of attitudes consistent with bureaucratic discipline and hierarchical control…

The authors provide a measure of the antiquity of a state; under their measure China comes in first place and Zambia comes in last. It turns out that state antiquity matters in cross-sectional growth equations:

…suppose that Mauritania, the country which recorded the second lowest value for [state antiquity] instead had the [state antiquity value] for China…Based on the estimated coefficient…this would mean that Mauritania would have recorded an annual increase of 1.9 percent in its growth rate. Given that Mauritania’s average growth rate during the 35-year period was nearly zero and China’s was 3.8 percent, differences in [state antiquity] can, by these calculations, explain half the difference in growth rates between the two countries.

I do have some caveats. Who ever knows what causes what in these macro equations? Furthermore state antiquity explains growth rates but not income levels. This would suggest that state antiquity matters more today than ever before, a possible but puzzling relationship. That being said, state antiquity does partially explain a “social infrastructure” variable, which in turn helps explain income levels.

If it were up to me: I would rather see economists address the important questions with imperfect tools, rather than focus on problems where their methods are immune to internal criticism.

By the way, I can’t find Iraq on their (hard to read) scatterplots, but I understand the modern version of the nation as starting only under British imperialism.