Journaltalk - Most Active Discussions

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1. Dissing "The Theory of Moral Sentiments": Twenty-Six Critics, from 1765 to 1949

   • I discover another passage from Dugald Stewart (1829) that should be included:

     “…Mr. Smith…has been led to resolve our sense of duty into a regard to the good opinion, and a desire to obtain the <i>sympathy</i> of our fellow creatures. I shall afterwards have occasion to examine the principal arguments he alleges in support of his conclusions. At present I shall only remark, that, although his theory may account for the desire which all men, both good and bad, have to <i>assume the appearance of virture</i>, it never can explain the origin of our notions of duty and moral obligation.” (pp. 37-38)

   • 9 comments
   • First comment 11 Jun 2018 by Daniel Klein
   • Last comment 23 Jan 2019 by Daniel Klein

2. Economic Enlightenment in Relation to College-going, Ideology, and Other Variables: A Zogby Survey of Americans

   • Gee, I wonder why this survey didn’t ask question about things like monopsony, the money multiplier effect of government spending, the free ride problem with public goods, natural monopolies, positive and negative externalities, etc. It is almost like the questions were cherry picked to get conservatives to do better than liberals! Was this funded by some right wing think tank?

   • 6 comments
   • First comment 10 Jun 2010 by N. Joseph Potts
   • Last comment 16 Nov 2015 by wargames83

3. Adam Smith, the Last of the Former Virtue Ethicists

   • McCloskey faults the project of the Enlightenment philosophers, Smith included, for neglecting two of the seven virtues of Thomas Aquinas: hope and faith (though she does claim these were smuggled in through the back door of their philosophies). I must admit to being puzzled about what use a secular moral philosopher should have for either virtue, both of which being explicitly based in religion.

     McCloskey describes hope and faith as two sides of the same coin, the forward-looking imagination and backward-looking imagination, respectively. Without hope, she tells us, there can be no ‘human project.’ Without faith, no ‘human identity.’ They do not, she asserts with no further explanation, ‘have to be theological.’ She implies that without hope as an independent virtue, suicide would be our only recourse, and without faith as an independent virtue, we would forget our identities. She claims that this makes the two virtues intelligible in secular terms, but as I can make no sense of any of it, I have to disagree.

     The ability to carry on projects that will bear fruit in the future does require a kind of simple “hope” that one’s plans will succeed. However, surely if this is all that hope consists of, skepticism must be a coequal virtue, otherwise the wasting of resources on impossible projects would be laudable and proper. And neither hope nor skepticism is an independent virtue, as hope could be described as prudence plus courage in imagination, and skepticism, prudence plus temperance in the same. Indeed, to an atheist, praying for eternal life perfectly fits the idea of “wasting resources on an impossible project.” I can understand hope as an independent virtue only in a specific theological context. The ancient pagan virtue ethicists also distrusted hope as a virtue, pointing out that hope adopted as a stable habit of mind would lead to continual bitter disappointment.

     With regard to faith, to twist it into a secular virtue when its commonplace meaning is the belief in a religion is to do violence to language and reason. McCloskey attempts to describe a physicist’s assumption of the orderliness of the universe as piety and faith (a faith slipped in stealthily whenever an Enlightenment philosopher refers to Nature), but it is nothing of the sort. She uses this poor argument against Rosalind Hursthouse’s reasonable contention that religious piety is “based on a complete illusion” from an atheist’s point of view and then rolls on to blame our uptight refusal to recognize the existence of hope and faith as independent virtues in Western philosophy for the rise of Bolshevism, Hitler, and “all our woe.” Despite violating Godwin’s law here, she declares her position defying two centuries of philosophy evidently correct, and “warmly recommends” her own flavor of non-secular hope and faith.

     McCloskey points out another way God allegedly sneaks in the back door in Smithian moral philosophy: through the idea of an impartial spectator. She claims: “The impartial spectator…is not merely [a behavioral observation] about how people develop ethically. [It is a recommendation.]” This assertion stands in baffling contradiction to much of The Theory of Moral Sentiments, which painstakingly describes a positive process of an individual judging the propriety of actions he observes or proposes to undertake with recourse to sympathizing with an imagined impartial spectator. TMS is not a long harangue from “an urbane resident of Edinburgh…hopeful for a rather better society, loving sweetly the imagined result” exhorting its readers to follow a system of virtues. It is principally a description of a positive system of moral philosophy: how we in fact judge the propriety of actions, not how we ought to. Though Smith often lets his values and opinions leak through to color the text, to an extent unfashionable among modern philosophers but charming in this case, the meat of the book is about how humans act, not how Smith believes they should.

   • 6 comments
   • First comment 22 Sep 2010 by Steve Kunath
   • Last comment 14 Nov 2012 by Todd Peckarsky

4. Mankiw vs. DeLong and Krugman on the CEA’s Real GDP Forecasts in Early 2009: What Might a Time Series Econometrician Have Said?

   • As a non-economist, I lack the expertise to critique the methodology of an economic analysis of this sort, but I’m skeptical of the objectivity of a hypothetical, retrospective prediction of what is now known to have transpired since. Why “posit a hypothetical time series econometrician who, at the time of the blog entries, applies some standard forecasting methods”? Weren’t such analyses with these “standard forecasting methods” done at the time? Did Professor Cushman offer such an analysis at the time?

   • 5 comments
   • First comment 23 Sep 2012 by Brooks
   • Last comment 24 Sep 2012 by Alex Nash

5. Religion, Heuristics, and Intergenerational Risk Management

   • On the Modigliani-Miller Theorem:
     “Economists calling this result a “theorem” when it is fragile to change of assumptions caused it to be taken more seriously than was warranted.” Actually, a statement is a theorem ONLY if it is fragile. The idea of a theorem is that you specify the exact conditions under which the conclusion is true. The most satisfactory theorems, for theory, say, “If and only if X is true, then Y is true also.” The MM theorem says that capital structure doesn’t matter under certain conditions, including that there is no corporate income tax and no moral hazard. The problem is with people who don’t know what “theorem” means and who think of mathematics and science as magic rather than ways of thinking, or who know better but are trying to fool less sophisticated people (which was more important in the case of the Li copula formula is still unclear to me).

   • 5 comments
   • First comment 30 May 2014 by Tom Garnett
   • Last comment 15 Aug 2015 by G. Ashton

6. Advanced Placement Economics: The Good, the Bad, and the Ugly

   • This is a great article as the others have said. This study needs far greater exposure to provide greater diversity in economic thinking. There is far more to economics than Keynesianism and the mechanics. Thank you.

   • 4 comments
   • First comment 25 Jan 2011 by Paul Johnson
   • Last comment 16 Mar 2011 by David B

7. The Ideological Profile of Harvard University Press: Categorizing 494 Books Published 2000-2010

   • Gordon and Nilsson have attempted a massive review of Harvard University Press books and admit to not carefully reading all 494 of them. I was pleased to see my book, Total Cure: The Antidote to the Healthcare Crisis (2008) made it past their initial screen-out. Their assessment, however, raises some concerns about what must be quick, and in at least one instance superficial, reviews. They categorize my book as “Left” and describe it as “Calls for universal compulsory health coverage that would cover two-thirds of costs. The rest would be dealt with by a voluntary program that would allow free choice of physicians.” That assessment sounds like “Medicare for all with voluntary supplemental coverage.” That is far from what I proposed.

     Even a quick read would indicate that the focus of the book is not on universal compulsory coverage, but rather on changing the medical care delivery system, with a far greater reliance on effective market mechanisms than we have now. While I do believe that universal coverage for major acute and chronic illnesses is critical to avoid gaming and selection, coverage for many things people on the Left feel should be covered is really an equity rather than an efficiency issue. There are better ways to achieve those equity goals.

     I realize that the strict libertarian would argue against any mandated coverage. Until the US citizenry is willing to let people who fail to provide for themselves die on the hospital’s steps, a coverage mandate for major illness is warranted. I raise significant concerns about any major role for government beyond certain minimal things it can do reasonably well. These concerns are problematic for those favoring a single payer solution. I think such an approach would guarantee coverage, but otherwise it would be a disaster.

     My concerns with public solutions arise, however, not from an anti-communitarian perspective, but rather from a recognition that our political system is too responsive to special interests. The appropriate use of market forces (which is quite different from letting existing players exercise their market power) is necessary to overcome that political power.

     Gordon and Nilsson did note that physician choice is critical in my proposal, but this is not as a sop to those who argue for choice in general—as in “free choice of physician” without any responsibility for those choices. Instead, my design uses choice as a core feature allowing individuals (even different members within a family) to choose the style of practice they want, while bearing the full marginal costs implied by their own choices. The plan makes those cost (and quality) implications real and accessible to individuals without unrealistic assumptions about consumer sovereignty and rationality in medical care choices.

     I don’t mind being attacked from both the left and right— that’s usually an honor. If one wishes to critique the literature for an ideological bias, however, it is best to get one’s facts straight.

     (For an example of a review by someone “not on the Left” who read the book more carefully, see this link.)

   • 4 comments
   • First comment 24 Jan 2011 by Hal Luft
   • Last comment 16 Feb 2011 by Milo Schield

8. The Liberty of the Ancients Compared with that of the Moderns

   • Constant’s speech discusses the tradeoffs that are imposed by the modern idea of individual liberty. In most representative governments today, individuals are left to make choices about how involved in the political process they chose to be. If Jack thinks that dedicating his afternoons to discussing policy is more costly than going to his job, he essentially outsources his political power—he votes (or chooses not to vote) and expects that his representative will act with similar interests to his own. The price that is paid for not censoring the public and not requiring full political participation (as was the practice of the liberty of the ancients) means that some people will, by choice, decide that their own private pursuits are more profitable. The profit Jack receives could simply be more time to spend engaging in discourse that is not political, it is not necessarily a monetary profit.

     The problem with trading political power for more individual liberty is that as more power is giving to legislators, they can exert more control over Jack’s individual pursuits, through regulation, taxation and other governmental controls. As an individual, he will find it more difficult to engage society in reforming these actions. A presumption of liberty needs to be maintained in the political sphere and also needs to be protected by legal rights of the individual. Otherwise, direct government involvement in the market process will begin to offset the betterment that Jack was pursuing in the first place by choosing a smaller amount of political power over his individual liberty.

   • 4 comments
   • First comment 15 Apr 2011 by Ariel Nerbovig
   • Last comment 06 May 2011 by Stephanie Myla Helmick

9. Entrepreneurship and Islam: An Overview

   • Say, you need 100% of underlying good for Islamic finance. What about 90%? 80%? How low do reserves go before it breaks Shari’ah law? Does the first dollar lent out of monetary deposits rather than lent on the back of real world collateral render the financial institution as counter to Shari’ah?

   • 4 comments
   • First comment 31 May 2014 by Eric Rasmusen
   • Last comment 03 Jun 2014 by Nathan W

10. Faculty Voter Registration in Economics, History, Journalism, Law, and Psychology

    • Great study, The next step should be finding “WHY”?
      First of all, we know scientists and faculties are likely to be less religious and more atheists, what about atheists’ political leaning, how much of “atheists” explains the D:R distribution.
      Second, majority of the Faculties are “secondary value generation” which means they do not produce goods and services directly, rather, they are supposed to “enable others to create more value”. We also know people working in “secondary value generation” industries (I.e. journalism, acting, etc) are also more politically leaning to the left.
      Third, “narcissistic intelligence”, which means how much people consider their own political believes and their intelligence is superior than others, and what are the typical political learning for people with “higher than normal self-confidence in their own believes”.
      Fourth, “political openness” what is the likelihood of people with D or R political leaning hire peole who are not politically aligned with them.

    • 4 comments
    • First comment 02 Oct 2016 by John Quiggin
    • Last comment 17 Oct 2017 by Mitchell_Langbert

11. Preference Falsification in the Economics Profession

    • When I was a cadet in my senior year, we had to take a class with the senior officer in charge of the ROTC department. One of the concepts that I remember him trying to drive home was that we were preparing to enter a “profession”. At the time it struck me that he was grinding some sense of inadequacy, looking for a word that would make his own career more significant in the way some janitors want to be called “sanitary engineers”. However, two elements of his definition of a profession have remained with me (I’m sure there were more). In the colonel’s definition, a career field was a profession if it had a body of knowledge and an ethical code of conduct. Merely having an expert knowledge of a field made you a technician, not a professional. The ethical code of conduct instructed you on how you were to use your expert knowledge, and provided purpose for professional practice.

      In the quote above, Davis is referring to what the important work of the economics profession is, rather than what is important to be successful in the profession in this particular quote, but in an ideal world, the latter should flow from the former. I believe many people come to the social sciences with a desire to make society better (we may not all agree on what “better” means, but that is a separate issue). The dissatisfaction I read, overtly and between the lines, is that the “profession” of economics, in its pursuit of the air of positive science, has lost its ethical code of conduct and has devolved to a technical career field. The statement, “The economics profession is a bad joke. More and more economists are saying less and less to fewer and fewer people. And they conceal their vacuity in abstruse language and mathematical formulae” (p. 364), strikes at the heart of the loss of a professional ethic in the field. What is the ultimate purpose of economics but ultimately to increase society’s understanding of the economy and thereby guide policymakers to make effective policies? This does not necessarily mean that a lay person should be able to pick up an economics journal whose audience is intended to be professional economists and understand it fully any more than a lay person should be able to pick up a copy of the New England Journal of Medicine and expect to fully understand it. Every profession must have an introspective element that works to extend the professional knowledge, and a means of communicating that new professional knowledge.
      Davis paraphrases respondents who say collectively “The bifurcation of the economics profession into researchers, teachers, and policy-makers has gotten worse and the number of individuals who are respected for contributions in all three areas gotten fewer and farther between” (364). I am not sure this is actually a problem – it sounds like a matter of comparative advantage for the individuals involved. We are after all the field that promotes specialization of labor. The real problem seems to be that the economics field has been overwhelmed by its pursuit of the professional body of knowledge, and in particular a very narrow portion of the body of knowledge as defined by the use of mathematical methodology, and has lost its commitment to the ethic of betterment that defines social science practitioners as professionals rather than as mere technicians.

    • 3 comments
    • First comment 21 Apr 2010 by Jon Goldstein
    • Last comment 22 Apr 2010 by Shawn Reed

12. A Life among the Econ, Particularly at UCLA

    • As a student during this period (PhD 1972) I was extremely fortunate to have been taught by these professors. Well remembered is the BSU bomb incident at the department as well as tenured faculty guarding halls against crazies disrupting classes. Learning to reason as an economist was paramount. On one qualifying exam, I felt one question assumed away the problem and rather than give an answer I pointed out the error. This risky strategy was well received. Alchian was on my dissertation committee but was slow to read the work. Knowing his keen interest in market transactions and since i was facing a deadline for a fellowship stipend, I made him a non serious offer. If he would just read it, I would split any stipend with him. This was not asking for an approval, just a reading. Obviously he would never accept any money, but as i knew he would, the market spirit of the offer was appreciated. During meetings of my nonacademic career, my annoying market based queries would often elicit the query “Where did you come from?”. I now know that the answer should have been “The Golden Age of Alchian’s UCLA Economics Department”.

    • 3 comments
    • First comment 08 Sep 2010 by morrie goldman
    • Last comment 17 May 2011 by josil

13. Individualism: True and False

    • Much of this introductory chapter to Hayek’s 1948 work deserves ample praise: that rationalist epistemology leads to an ever-encroaching desire to design state-imposed solutions; that individualism recognizes that man in a free state will achieve more than is possible laboring under centralized intelligent design; that true individualism is only selfish in the sense that the individual self directs his own affairs, whatever his egoist or altruist intentions; and that equality is a two-sided coin such that pursuing equality of treatment necessitates inequality of results, and vice versa.

      Unlike some other individualist theorists, his attack on state authority and especially its roots in rationalism is made largely on practical terms. He doesn’t say that statism encroaches on man’s “rights” or on moral principles. Rather, he makes the simple observation that individuals should direct their own affairs because they each are aware of the particulars and the intended objective of those affairs. Society at large and bureaucrats as its representatives simply can not know the ends that men seek in their several endeavors and can not devise all the practical means to achieve them.

      Certainly arguing for a liberal social order from a rights-centered perspective (like that of Locke, Rand, or Nozick) has its own pitfalls. But what if the problem is not with Hayek’s airtight reasoning of matching the actor with his wants, but with his presumption that the correct object of analysis is the individual and not society? If the reader believes that social goals are more aspiring than individual goals, Hayek’s arguments could be used against him: just as it is more practical for individuals to know and direct the pursuits of the individual, it is likewise more practical for society to know and direct the pursuits of society. It is not clear that Hayek has established methodological individualism before arguing for political individualism.

      This should not be a difficult proposition. As societies have become less autocratic and more responsive to democratic impulse, they have also become more tailored towards individualistic ends. Post-war rationalist planners (conservative and liberal) emphasize large welfare states to achieve largely individual goals instead of leviathan state actors to achieve collectivist goals. In other words, history is on the side of the methodological individualist. Yet Hayek did not know this in 1948, and should stress that point more.

      What logically follows from this is that rationalist planners would reduce the ends (and the means) of human pursuits to a least common denominator. As Hayek puts it, “The concentration of all decisions in the hands of authority itself produces a state of affairs in which what structure society still possesses is imposed upon it by government and in which individuals have become interchangeable units with no other definite or durable relations to one another than those determined by the all-comprehensive organization.” (p.27) What is lost is individuality and the localized functions of civil society. Even for those who have communitarian or anti-individualist preconceptions, this is a tragic development.

    • 3 comments
    • First comment 22 Sep 2010 by Tony Quain
    • Last comment 10 May 2013 by Matt

14. "The Two Faces of Adam Smith"

    • Echo’s critique is insightful, and touches on Hanley’s recent appraisal of the article. I would like to suggest that while Vernon Smith’s experiments are very interesting, that his jumping off point misses a better way to reconcile Adam Smith’s two works.

      Although Adam Smith does attribute the propensity to truck, barter, and exchange to man as one of his most innate qualities, it is not the most obvious bridge between the two books. As a method of operation in the world, the propensity is important; as an explanation of the origin of our behavior, less so. The Adam Smith of the Theory of Moral Sentiments proposes a picture of man who receives input from the world around him about how he ought to behave. The man wants to be loved and to be loveable out of a concern for his self-interest. Both works address the content of self-interested behavior. The content which makes up self-interest in each book is explained differently, but they both amount to an exploration of self-interest in different frames. Paganelli (2008) even suggests that self-interest is judged with a more friendly result in the Theory of Moral Sentiments than in The Wealth of Nations.

      Self-interest, rather than the propensity to truck and barter, is perhaps the real tie between the two works. In the Theory of Moral Sentiments Smith addresses humanity in the full context of human interactions, while in the Wealth of Nations he addresses that part of society most affected by the virtue of prudence. The method of approach is therefore different, but the starting point for each is not so far apart as is often assumed.

    • 3 comments
    • First comment 25 Apr 2011 by Echo Keif
    • Last comment 06 May 2011 by Steve Kunath

15. Economic Enlightenment Revisited: New Results Again Find Little Relationship Between Education and Economic Enlightenment but Vitiate Prior Evidence of the Left Being Worse

    • How did you intend the word “purported” to be interpreted, with respect to your article?

    • 3 comments
    • First comment 17 May 2011 by rihir akidan
    • Last comment 28 Apr 2012 by Moshe

16. The Invisible Hand of Jupiter

    • I hope to add to, and hopefully not just echo, what Erik has already pointed out.

      It would seem that Smith’s use of the “invisible hand” allegory in both The Theory of Moral Sentiments and The Wealth of Nations is used to illustrate the edict of nature and society that direct economic activity. Whereas, in the History of Astronomy the “invisible hand” is used to explain the unexplainable— the events that are beyond the natural laws of the secular world. On the surface, the “invisible hand” reference takes on a slightly different connotation in the three Smith pieces mention above. In The Wealth of Nations it can be interpreted as the natural laws that manage markets and society; in The Theory of Moral Sentiments it can be seen as a divine set of universal rules directing a just and virtuous society; and, in the History of Astronomy it can take on the role of a divine authority overriding these rules and laws. I believe, as I deem Erik does, that the latter use of the “invisible hand” also shows up in The Theory of Moral Sentiments and The Wealth of Nations. Consider the following few lines from The Theory of Moral Sentiments: “The rich…only consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life…had the earth been divided into equal portions among all its inhabitants…”. Although “selfishness and rapacity” would seem to be characteristics that would not direct society in the way of justice or virtues, the industrious individual’s “natural” penchant to serve his own interest ultimately benefits society—the mean may not appear agreeable, but the end is. Is this “natural” penchant toward “selfishness and rapacity” not assumed to be put in place by a precocious, divine authority? It certainly can be interpreted that way. If we except that the “invisible hand” is the work of a higher authority, who has directed the butcher and the brewer to act in their own self interest, and who has provided society with nature ethics and virtues to govern themselves, and who makes it “lightening” and “thunder”, then the metaphor is consistent in all three of Smith’s works referenced above. Since this heavenly intention or intervention is not observable, Smith does not bother with a speculative explanation, simply calling it the “invisible hand”.

    • 3 comments
    • First comment 15 Oct 2011 by Pavel Kuchař
    • Last comment 15 Nov 2012 by Francis Conlon

17. Can ‘Religion’ Enrich ‘Economics’?

    • Hi, T. My wife’s family moved away from Winnipeg, so I haven’t been back for quite a few years now. I enjoyed your article, which makes an interesting pairing with mine for comparison of where we agree and disagree. You make me feel I should read some of Whately’s work.

      I like the idea that the Invisible Hand is evidence of God’s Providence, similar to the wonders of the human body. It is a natural process, to be sure—- but isn’t it wonderful that we live in a world where the Invisible Hand works? It’s a bit like the physicists’ Fine-Tuned Universe. Your article made me realize that William Paley, of Watchmaker fame, wrote a book about “social science” as well as one about natural science. His Evidences of Christianity (http://www.gutenberg.org/ebooks/14780) is about arguments from history and sociology, e.g. why were the early Christians so willing to suffer persecution if the Gospels were falsehoods, and why did Christianity spread so much in the world? Economics can try to address those, just as evolution tries to address the Watchmaker, and, indeed, I’d count Rodney Stark as an honorary economist.

    • 3 comments
    • First comment 30 May 2014 by Eric Rasmusen
    • Last comment 10 Jun 2014 by Nathan W

18. Education Premiums in Cambodia: Dummy Variables Revisited and Recent Data

    • Thanks for your comment Ronald.

      You give me too much credit. The approach I used was not my technique, but the conventional approach used in the literature.

      As it happens, I agree with you that the conventional approach to reporting education level premiums can be misleading. I’ve made the same point elsewhere. Unfortunately for you and I… if we want to make comparisons with other estimates around the world or through history, then we need to use the same approach as others.

      Perhaps we can help change that convention over time. Good luck to us. But the point of this paper was more modest.

    • 3 comments
    • First comment 30 Sep 2015 by Ronald Michener
    • Last comment 30 Oct 2015 by Ronald Michener

19. Ideology Über Alles? Economics Bloggers on Uber, Lyft, and Other Transportation Network Companies

    • I am and always have been surprised by the “cartel” view of taxis. No one calls the Maine lobster industry a cartel. Yet surely and appropriately it is. The lobster fishery is a common access resource. So, too, are the streets of a city. Part of the income enjoyed by lobster fishermen is a scarcity rent. So, too, is the price of a taxi and a taxi-cab medallion. Cities for many, obvious political-economy reasons are awful at managing common access to the streets. Nonetheless, the social value of Uber is not to lower the price of a taxi, which should be even higher in some cases, but to offer the consumer a more technologically efficient way of delivering the scare good

    • 3 comments
    • First comment 30 Sep 2015 by Michael Maloney
    • Last comment 24 Oct 2015 by Carl Edman

20. The Social Science Citation Index: A Black Box—with an Ideological Bias?

    • Hoover Institution publication Policy Review just printed its last issue this month (2/2013). That’s one less conservative SSCI journal cited in the Klein and Chiang article. Will any of the remaining conservative academic journals (such as ANAMNESIS, Academic Questions, First Things or Modern Age) ever obtain SSCI?

    • 2 comments
    • First comment 01 Nov 2011 by Alex Littlefield
    • Last comment 11 Feb 2013 by Alex Littlefield