David Hume was born three hundred years ago, in 1711. The world has changed radically since his time, and yet many of his ideas and admonitions remain deeply relevant, though rather neglected, in the contemporary world. These Humean insights include the central role of information and knowledge for adequate ethical scrutiny, and the importance of reasoning without disowning the pertinence of powerful sentiments. They also include such practical concerns as our responsibilities to those who are located far away from us elsewhere on the globe, or in the future.

...

As it happens, contemporary theories of justice have largely followed the Hobbesian route rather than the Humean one. They have tended to limit their considerations of justice within the boundaries of a particular state. In an important essay in 2005 called “The Problem of Global Justice,” Thomas Nagel explained that “if Hobbes is right, the idea of global justice without a world government is a chimera.” The most influential modern theory of justice, namely John Rawls’s theory of “justice as fairness,” presented in his epoch-making book A Theory of Justice, concentrates on the identification of appropriate “principles of justice” that fix the “basic institutional structure” of a society, in the form of a cluster of ideal institutions for a sovereign state. This confines the principles of justice to the members of a particular sovereign state. It is worth noting that in a later work, The Law of Peoples, Rawls invokes a kind of “supplement” to this one-country pursuit of the demands of justice—but in dealing with people elsewhere, Rawls’s focus is not on justice, but on the basic demands of civilized and humane behavior across the borders.

Amartya Sen on Hume, the rest here.  (HT MR)

The psychologist Gerd Gigerenzer has shown that if conditional probabilities are reinterpreted as frequencies, people have no problem in interpreting their meaning (see the discussion "Risk School" in Nature 461,29, October 2009). Gigerenzer has been promoting the idea that trigonometry be dropped from the high school math sequence (no one uses it except surveyors, physicists, and engineers) and probability theory be added. This sounds like a great idea to me.

Herbert Gingis reviewing Daniel Kahneman's Thinking Fast and Slow over at our very dear friends at Amazon (HT, as too often, MR) [We at pp are huge fans of GG, not that it helps: we feel that if our very dear friends in the biz had but read GG, and then immersed themselves in the oeuvre of ET, we could have been a contender.] [This is not necessarily the most insightful quote from HG wrt DK, but we at pp are, as we say, huge fans of GG.]

Stop press!!!!!! New Yorkers take note! 


On Saturday January 21 at 2.00pm Edward Tufte will conduct an open forum answering questions about analytical design, art, the creative process, and public service. Free event, ET Modern.
On Monday January 23, 2012, Edward Tufte will give his one-day course, "Presenting Data and Information," at ET Modern. The Monday course filled up quickly and is now closed, so we've now added another course day: Sunday, January 22, 2012. See below for course information and registration.

post hoc, ergo propter hoc (not)

... A lot of success stories we hear are despite the system, not because of it, and the sooner we recognize that, the better the chances that we’ll do something to fix the status quo. 

Editorial in LiveMint, HT Steve Sailer on education in India, HT MR, more SS here.  Mutatis mutandis . . .

Tyler Cowen at MR, linking here:

Coffee shops around the world have employed loyalty card schemes for many years, but now we’ve come across an interesting twist on the idea. In Singapore, a collaborate scheme aims to benefit eight of the city’s best independent cafés with the Be Disloyal disloyalty card.

The Be Disloyal disloyalty card — created by digital creative agency Antics, blogger Cortadito.sg and eight of Singapore’s independent coffee shops — was designed to encourage consumers to discover different coffee venues while bringing businesses together to grow as a vertical. From September until the end of this month customers can pick up a disloyalty card from one of the eight participating cafés. The card is stamped each time they purchase a coffee from one of the other seven cafés and, once the card is full, they return to the original café to receive their free coffee.

Competing with large chain brands can be difficult for small businesses, but teaming up with similar smaller companies can create stronger competition. Inspiration here for independent businesses in any industry!

 model, maybe, for indie bookstores . . .
 

Noam Lupu and Jonas Pontussen (PDF) have a piece on the relationship between inequality and distribution in the new American Political Science Review. There is a lot of debate about whether the level of economic inequality in society leads to greater or lesser distribution – what Lupu and Pontussen suggest is that the structure of inequality (that is – the more particular relationships between different segments in the income distribution, rather than some summary index) is more important. More particularly they argue that if one tries to hold racial and ethnic cleavages constant, the key factor determining redistribution is the income gap between middle income voters and lower income voters. Where this gap is low, middle class people feel some degree of solidarity with the poor and exhibit what Lupu and Pontussen describe as “parochial altruism.” That is, they are more likely to support income redistribution because they feel that the poor are in some sense, ‘like them.’ When the gap is high, middle class people will have a much weaker sense of solidarity with the poor, and hence be less supportive of redistribution. Lupu and Pontussen suggest that the US is an outlier, with weaker solidarity than the structure of US inequality would suggest. They argue that the explanation for this is straightforward – “it is clearly attributable to the high-concentration of racial-ethnic minorities in the bottom of the income distribution.” More bluntly put – middle class Americans feel less solidarity with the very poor because the very poor are more likely to be black.

hat tip Marginal Revolution

There is much more of interest here. I would describe this as a major, still uninternalized lesson of the recent crisis, with its roller coaster-rapid dips. In a highly specialized modern economy, it is much easier to prevent jobs from being destroyed than to create them again, at least assuming those are "good" jobs in the first place. (Yes, people thought they knew this but it's an even stronger difference than had been believed.) The U.S. auto bailout, for instance, worked better than did most of the stimulus program.

Tyler Cowen on Nicholas Kulish at the NYT, on recent German economic success and expansion of a program to keep workers employed, rather than dealing with them once they'd lost their jobs

Courtesy MR, Keith Hennessey on The Roles of the President's White House economic advisors. Tyler Cowen is right to say: to excerpt would be to diminish the impact. Read the whole thing.

Last Call

Cowen on Last Call:

Okrent can't claim to have discovered Prohibition; Michael Lerner's recent Dry Manhattan is another good entry in a well-tilled field. What elevates Last Call is, among other things, a clear explanation of the unique confluence of events that caused it. The introduction of the income tax made Prohibition fiscally feasible. Women's suffrage made it politically feasible. World War I created a surfeit of patriotism, a willingness to sacrifice, and an embrace of the expansion of federal power. By 1920 everything was in place for a bold new government intrusion into everyday life.

Tabarrok:

Here is Okrent on Prohibition and the income tax:

By 1875 fully one-third of federal revenues came from the beer keg and the whiskey bottle, a proportion that would increase in the years ahead and that would come to be described by a temperance leader in 1913, not inaccurately, as "a bribe on the public conscience."

...it would be hard enough to fund the cost of government without the tariff and impossible without a liquor tax. Given that you wouldn't collect much revenue from a liquor tax in a nation where there was no liquor, this might have seemed like an insurmountable problem for the Prohibition movement. Unless, that is, you could weld the drive for Prohibition to the campaign for another reform, the creation of a tax on incomes.

If you could create a punctuation mark, what would its function be and what would it look like?

That's from Hudson Collins, loyal MR reader. I've always liked the chess marks "!?" and "?!" and wondered why they weren't used in standard English. The former refers to a startling move which is uncertain in merit and the latter refers to a dubious move which creates difficult to handle complications.

Yes! Yes!

Tyler Cowen at Marginal Revolution

10

What quickly became notable, however, was the scarcity of fiction. To a degree, this was determined by Cowen’s original list, but as the subject spread, the focus stayed relentlessly on non-fiction. Gradually, bloggers began to acknowledge the formative literature they had enjoyed as youngsters, so Tolkien and Asimov began making some appearances, as did the likes of Orwell and Conrad. Drama, meanwhile, was largely limited to Shakespeare, predictably enough.

If this trend had spread among literary bloggers rather than social scientists, of course, that would likely be reversed, but the trend was noteworthy all the same. One of the most animated conversations followed the list created by Kieran Healy, an Irish sociologist at Duke University who is a member of the academic supergroup blog Crooked Timber. “Everyone else is doing it, at least for ‘American/ white/ politics/ economics/ mostly libertarian type guys’ values of ‘everyone’,” he wrote, and his terrifically diverse list, which features works by Clive James, Pierre Bourdieu and game theorist Thomas Schelling, as well as books on biomechanics, the collective dietary habits of ravens and power dynamics in medieval German society, led to a long and engaging discussion about what it is to be shaped and influenced by books.

But the underlying premise that went largely unquestioned, the notion that books play a predominant role in shaping our intellectual outlook, was roundly rejected by the Washington Post’s Ezra Klein, who came up with a non-list instead: “So much as I love my favorite books, the biggest influences in my thinking have been the continuous intellectual relationships I’ve had with blogs, periodicals and other people. Books aren’t even that close.”

Davin O'Dwyer (Irish Times) discusses responses to Tyler Cowen's 10 Most Influential Books post, the rest here.

desperately seeking ideal speech situation

Sorry for not following anyone. I'm still trying to lear how to use this tool. JH

Yes, that JH is Jürgen Habermas.

From the indispensable Marginal Revolution. The rest here.

[Later]

Jonathan Stray reports:

Over the last several days there has been considerable hubbub around the notion that pioneering media theorist Jürgen Habermas might have signed up for Twitter as @JHabermas. This would be “important if true”, as Jay Rosen put it. Intrigued, I tracked him down through the University of Frankfurt. I succeeded in getting him on the phone at his home in Sternburg, and asked him if he was on Twitter. He said,

No, no, no. This is somebody else. This is a mis-use of my name.

He added that “my email address is not publicly available,” which suggests that perhaps he didn’t quite understand what I was getting at.

The rest here.

codes of the underworld

The signaling problems faced by criminals are unusual in the following regard. On one hand they wish to signal a certain untrustworthiness, namely that they are criminals in the first place. This is useful for both meeting other criminals and also for intimidating potential victims. On the other hand, the criminals wish to signal that they are potentially cooperative, for the purpose of working with other criminals. Sending these dual signals isn't easy and Gambetta well understands the complexity of the task at hand.

Tyler Cowen of MR, on Diego Gambetta's Codes of the Underworld: How Criminals Communicate.

you don't need a diploma, you need a work ethic

Tyler Cowen of Marginal Revolution on education and signaling, here

If education is pure signaling, just give everyone a standardized test in seventh grade and then close up the schools. But the process of self-image formation, at least for most people, is far from complete at that point.

That being said, education will look like what the signaling model predicts. It will be about subtle brainwashing, image, and learning markers of status. What the signaling model misses is how important those features are for your subsequent productivity.

Nerds will hate education and tend to embrace the signaling model. Their sense of self is often formed quite early, and they do not why so much time should be wasted in school. This is one reason why the signaling model is so popular in economics.

and here

We find that employer learning about productivity occurs fairly quickly after labor market entry, implying that the signaling effects of schooling are small.

Here is much more. And here is more yet; this second paper estimates the speed of employer learning and uses that estimate to bound the value of the signal at no more than 28 percent of the value of education. I consider this devastating to the signaling hypothesis. How can ?? years of schooling be needed to signal your quality, if your employer often knows your quality within months?

who will buy

Andrew Sullivan pointed out that it is legal to pay two people to have sex and film them and sell the film; it just isn't legal to pay two people to have sex and simply watch them. That's what I call absurd.

Tyler Cowen of Marginal Revolution on the legalization of prostitution

Roger Matthews in the Guardian, initially in favour, changed his mind.

any fan of Dr Seuss...

Kevin Drum wonders why Clinton and Obama supporters get so worked up at each other. Any fan of Dr. Seuss will know that policy similarity hardly matters. The two candidates represent two diametrically opposed portraits of the relationship between aesthetics and politics. Should we expect beauty, grace and universality, or should we derive our feel-good sentiments about politics from righteousness, confrontation, and sheer dogged persistence and feelings of ultimate desert? Given his desire for partisan confrontation, Paul Krugman is quite consistent in his skepticism about Barack Obama. The far more conservative but also far more aestheticized Andrew Sullivan is quite consistent in liking and indeed at times almost loving Obama. There really is a lot at stake in the Democratic primary; it's our current sense of the aesthetic, and of desert, that drives what our substantive policy views will be twenty or thirty years from now. Given the high turnout (never an accident), in an odd way there may be more at stake in the Democratic primary than there would be in a Clinton vs. McCain general election.



Tyler Cowen of Marginal Revolution on you know what.

marginal utility

I had a bad habit. I would get up, check e-mails; next thing I knew, several hours of surfing would have gone by. As 2007 wound down, I worked out 1) that the marginal utility of spending an extra two hours online was infinitesimal compared to the utility of going to the gym (2 hours including travel and changing) and 2) that the marginal utility of spending an extra 4 hours online was negligible compared to the advantage conferred by going to a language course 5 days a week and tackling German. If I had replaced 6 hours of time online with those 2 activities daily for the whole of 2007 I would now be 1) thin, fit and cheerful and 2) in a position to get a job. I say 'year' but 3 months would have done the trick. So I have been getting in touch with my inner Utilitarian.

Meanwhile, Tyler Cowen has a post on Marginal Revolution referring to his article with Karl Bordeaux about microcredit, the full text of which is available at Wilson Quarterly. He says:

Sometimes microcredit leads to more savings rather than more debt. That sounds paradoxical, but borrowing in one asset can be a path toward (more efficient) saving in other ­assets.

...Westerners typically save in the form of money or ­money-­denominated assets such as stocks and bonds. But in poor communities, money is often an ineffective medium for savings; if you want to know how much net saving is going on, don’t look at money. Banks may be a ­day­long bus ride away or may be plagued, as in Ghana, by fraud. A cash hoard kept at home can be lost, stolen, taken by the taxman, damaged by floods, or even eaten by rats. It creates other kinds of problems as well. Needy friends and relatives knock on the door and ask for aid. In small communities it is often very hard, even impossible, to say no, especially if you have the cash on ­hand.

...Under these kinds of conditions, a cow (or a goat or pig) is a much better medium for saving. It is sturdier than paper money. Friends and relatives can’t ask for small pieces of it. If you own a cow, it yields milk, it can plow the fields, it produces dung that can be used as fuel or fertilizer, and in a pinch it can be slaughtered and turned into saleable ­meat or simply eaten. With a small loan, people in rural areas can buy that cow and use cash that might otherwise be diverted to less useful purposes to pay back the microcredit institution. So even when microcredit looks like indebtedness, savings are going up rather than down.

In other words, read Keynes's chapter 17, go long on animals (liquidity premium exceeds carrying costs), go short on money (carrying costs exceed liquidity premium, at least in poor countries), and increase your future expected net wealth.

***

and now I must go to the gym before returning to verbs and their prepositions.