Tuesday, September 26, 2006

The Marshallian System of Economics

In a letter to Pigou, Alfred Marshall laid out the following six rules of expressing economics:

(1) Use mathematics as shorthand language, rather than as an engine of inquiry.
(2) Keep to them till you have done.
(3) Translate into English.
(4) Then illustrate by examples that are important in real life.
(5) Burn the mathematics.
(6) If you can’t succeed in 4, burn 3.

Monday, September 25, 2006

Fondler's remorse

It doesn't need too much of an introduction, so I'll just give the title of this story from Finland: "Court says $32,000 is too much to fondle bosom."

The kicker is the direct quote from Judge Hasse Hakki-- "Based on general life experience alone, it is indisputably clear that a 25,500 euro charge is disproportionate to the compensation in question." Is this the judge's way of saying that the woman isn't worth that amount? I read it as: "On behalf of the state, we have determined that you are cheaper than $32,000." Naturally, value is subjective, so the judge's preferences imposed on the situation will lead to a different level of proposed compensation than the "victim's." Evidently the man willingly paid the amount at the time, yet filed the charges anyway-- sounds like a case of "fondler's remorse."

More importantly: How does the punishment do anything to rectify the situation? In the eyes of the court, the man was overcharged for the service. Jail time does nothing to rectify that fact. Further, throwing her in jail prevents her from generating any more wealth from similar activities, though she may now have access to a different segment of the market. Not that any case should be brought against the girl in this matter, but restitution would be the only verdict that would make any sense.

Tuesday, September 19, 2006

Back to the moon

Why do we have to return to the moon? First, the obvious negative before the debatable positives: the fiscal drain is enormous. The article notes that President Bush called for a $12 billion commitment from NASA for the start of the program, with more to follow. That's $40 per American; what could every American do with that money back in their pocket? Further, is it worth it to you to get back to the moon for $40?

(And if $12 billion had to be committed to this program, why not situate some sort of Ansari X setup and let the best team win?)

It seems like all of the positives attributed to this project are speculative, at best. The "deep geological record" of the moon is of importance; if we know what's there, we don't need to return to confirm it, and if we aren't sure what's there, there is a chance that what is found won't be of any importance at all. It's an information search problem. The moon could also be a great opportunity to support robotic and human exploration of space-- while that is probably true, that just shifts the "Why look here?" problem from the moon to outer space. Do companies engage in such massive research outlays with such spotty prospects for anything good coming from it? Drug companies spend a ton on Phase III testing, but those are on drugs they know are pretty effective-- that's just to appease the FDA.

One plus that would likely come about would be a technology spillover...but at $40 a head for the entire country? Seems a bit...astronomical. (HA!)

Thursday, September 14, 2006

File this under: Markets can work

The worst eminent domain cases tend to hit the headlines, especially since Kelo v. New London, but it's nice to see cases of the market working it out. Read about Evelyn Wray's settlement with the Dallas Cowboys. (Though it is a bit troublesome to see a court-appointed panel setting private land values.) It sounds like the case was heading to a bitter conclusion in the court system...but it's nice to see property rights respected, isn't it? Even if it's just a little bit?

Wednesday, September 13, 2006

Dead Leaves and the Dirty Ground

The seed collectors of the world get their day in the spotlight today. My two favorites:

"...the 8,000 unique species of fijnbos [in South Africa] are a real worry."

"Tony Kirkham, tree specialist at the world famous Royal Botanical Gardens at Kew in southwest London, noted that the Macedonian Leaf Miner moth had invaded in recent years and was attacking -- and eventually killing -- Horse Chestnut Trees."

Basically, some plants species are dying in response to the climate change, and some are doing a bit better. The feeling is, generally, that plants dying is a bad thing.

In markets, it's commonly assumed that a business dying is also a bad thing. It has been shown, however, that business failure is an indicator of economic progress. If businesses are failing, capital is being directed from less valued uses to more valued uses; entrepreneurial spirit is therefore strong. Preventing "bad" businesses from failing hinders the ability of capital to find its best use.

Can the same be said for plant species? Is an effort to keep all plant species alive making the overall plant regime...weaker? Inefficient?

In other science news: the unintended consequences of wearing a bicycle helmet.

Monday, September 11, 2006

Socializing the mines

Death fades with time. It's a fact of life that a lot of people don't like to admit to, but it's nonetheless true. September 11 is no less horrific now than it was five years ago, but the general public is less resolved. It's the same for any tragedy-- Flight 800, the Loma Prieta earthquake, Pearl Harbor. Even Katrina isn't what it was a year ago. It's just a fact of life.

What doesn't fade from these tragedies is the knee-jerk regulation that comes from it. The Patriot Act is a glaring example. More specific to West Virginia is the M.I.N.E.R. Act (that's a .pdf), an across the board increase in safety regulations after the Sago and Massey Energy Mine accidents early in the year. I remember thinking that the only good that can come from this act is the one-time psychic boost the public would get. The safety improvements were marginal, at best, while the costs of such measures had certain and deleterious effect on mine operators. (One common example is that two hours of oxygen is now required, above the previous level of one hour-- then recall that the Sago miners were trapped for nearly two days.) The increased safety regulations really don't make anyone any safer-- but it does keep the tragedy fresh in the minds of those who would probably be best being able to heal and move forward.

Of course, this is all assuming that the safety regulations are actually being enforced.

Many miners still choose to work for mines despite conditions, but this is an informed choice that they make--no one is being taken advantage of. Many of the families of the Sago miners were quoted as saying that they didn't like the fact that their relatives were working in the mines, but the money was just too good to consider other (safer) jobs. Who has the right to make a cost/benefit decision on behalf of any family?

Furthermore, is requiring costly safety improvements any different than requiring a remittance from miners who received a wage premium even though they never got hurt?

It's not the place of legislators to eliminate risk from the workplace (though they often feel exactly the opposite), much less do so with an uneven hand.

Friday, September 08, 2006

It's peanut butter jelly time!

Respect us and our peanut-restricted schools. In short, peanuts and peanut-related products are banned. Well, not banned, but merely strongly suggested against. Though a note from your parents will suffice if that's all that your child will eat. Another well-defined law here in West Virginia! I'll try to provide as many of these as I can, as I run across them.

Does this remind anyone else of the learning disability policy? Note from parents? Forced acquiescence to the policy?

Wednesday, September 06, 2006


Vladimir vodka is the drink of choice in West Virginia. Only the highest quality here in the Mountain State. Maybe a lot of people here in Morgantown are conducting scientific experiments. Maybe not.

Regardless, people here in West Virginia still can't buy liquor on Sundays. There's an op-ed here and a general rundown of blue laws here. This has to be one of more comical laws in West, right up there with the business and occupation tax and the franchise tax ("for the right to do business in West Virginia"). What is the intention of preventing people from buying liquor on Sundays, anyway? Is it to prevent people from drinking on Sundays? Why doesn't the law say that instead? It's one thing to have an idiotic law; this is an idiotic, passive-aggressive law. There is a push to repeal this law, but since most of the legislative effort in West Virginia is focused towards November's Special Session, it's probably not likely that anything will happen until the Spring.

Then again, one of the reasons legislators are targeting this law is to increase tax revenue-- estimated at over $1 million a year. Less liberty, but lower taxes? Dish out more in taxes, but have a shot of freedom? Such are the choices here in No. 50 West Virginia.