Tuesday, November 13, 2007

Don't Worry, Be Happy

The New York Times has an interesting article on Happiness Studies today. I thought it was pretty interesting, despite my skepticism of almost anything that has to do with happiness studies. The article does a good job at pointing out some of the flaws and inconsistencies of basing a social and economic theory on the maximization of such a subjective and dubious psychological state. I sometimes laugh at the thought that one day, instead of complaining about income inequality, we might be talking about happiness inequality. Democrats will argue that happiness is concentrated in the top 1% of the population and needs to be redistributed more equitably, while Republicans will say that that those who don't have a lot of happiness obviously didn't work hard enough to get it. Then the poor, unhappy immigrants who come to our country will be deplored for bringing down the average happiness of our country, despite the overall gains of happiness to them.

Sounds a bit crazy...

Tuesday, August 21, 2007

Interesting article here from today's LA Times. It details a new marketing strategy which aims to use smell psychology to help sell products. This new rage, labeled "scent marketing" is just another subversive tactic used by marketing firms and corporations to undermine free-choice. Alright that previous statement might have been a bit harsh and over-zealous, but really?...this has potentially huge implications in economic theory, which says that consumers shouldn't be persuaded to buy a product because of insidious and inconspicuous marketing techniques. And it seems to work to.

"In 2006, when ScentAndrea, a scent marketing company in Santa Barbara, put chocolate scent strips on 33 vending machines in factory break rooms in Ventura (plus a sign that said it was Hershey's candy people were smelling) the brand's sales tripled."

What's next? Maybe stores can send undercover henchmen with clubs to circulate through their stores and knock out unsuspecting customers (victims?), forcing products into their hands, and taking money from their wallets...You may say, "well that is a bit extreme" but really current methods of marketing are getting pretty close. We are bombarded daily with images and sounds and now smells that are all contrived to sway us to buy a certain product or eat at a certain fast-food restaurant or wear a certain type of jeans or else you won't be cool and you won't have any friends and high school and then girls won't like you (I'm still trying to figure out what those magic jeans are...so I can go out and buy them!).

Wednesday, May 30, 2007

Give Her A Ringpop. It's Cheaper And Way More Delicious

The Freakanomics blog has a good post on obsession with weddings, commenting on the ridiculous amount of money that people are increasingly spending on these single-day vanity bashes. An interesting stat mentioned in the post is that Americans spend 14 billion dollars a year on engagement rings and other matrimonial garb. Now this pales in comparison to our country's defense budget, but is still a significant amount of cash. Why do people spend such large sums of money are seemingly useless pieces of rock and metal. At least a golden toilet serves some practical purpose beyond pure aesthetics, but jewelry has no real use-value. Yes, they are very pretty to look at, but so are rainbows, and you don't have to spend several months paychecks to look at them. The diamond and jewelry craze seems to be a product of both cunning advertising and the insatiable desire for private property. It is not enough that these "treasures" exist, but each person feels they must privately own a piece of it.

I was thankful this summer for the release of the movie "Blood Diamond", hoping that it would reveal the true human costs of the diamond trade. But alas, it seems to have had no lasting impacts on the public conscience. It seems that Hollywood is only expected to produce non-fictions, and movies any semblance of truth or fact in movies are dismissed by the public as not having any possibility of being so. Regardless, the diamond trade continues to brutally harsh. Maybe if a little disclaimer were placed next to the price tag: "(number) of poverty-stricken people were killed or injured in the production of this overpriced symbol of opulence. (number) of people were also displaced from their homes and (number) of families were broken up. Lives are transitory, but diamonds are forever."

Tuesday, May 29, 2007


We live in an age of fear. This fear is not singular in nature. It is a composite of many fears, insecurities, and doubts. It comprises the past, the present, and the future. It is not just terrorism, it is job security. It is not just world poverty, it is your own poverty. Nobody wishes for a violent world, yet when violence can act as a means towards individual goals, violence is sometimes condoned. But when is the cost of violence too much? How many people must die before liberty is no longer of value. How many must perish before words no longer need be free. How many can you murder in the name of national security before further killing detracts from your desired security. If the world would be eternally peaceful if every American gave up 10,000 dollars today, do you think we would do it? Would you do it? We all want peace, but what are we willing to give up for it. Will you give up freedom, security, love, and justice all for a more peaceful world. Or are these things only possible when peace is truly achieved.

The movement towards a peaceful world is necessarily slow, and the path is ridden with obstacles. But there is a great wall that stands near the end of this path. If peace is to come, this wall must be abolished. It is the wall that stands between the rich and the poor, the can do's and the can't do's, the economic north and the economic south. It is the wall of prosperity, and unfortunately in this world some people cannot traverse this wall. For many, the wall is too high, and they are too short. They cannot afford the ladders or ropes to climb over it. They also do not hold the means or abilities to destroy this wall. This is up to the rich, the can do's, the economic north. They have the means and abilities. There can't be real justice without economic justice. People will be hungry as long as they can't feed themselves. They will be poor as long as the north consumes without abandon. They will perish as long as they are perceived to be less-than-human. Our nation is founded on the ideas of freedom. The economic south is not free. But to rule over them, to absorb their resources, and to exploit their poverty to the profit of the north will never make them free.

Saturday, May 26, 2007

Proof of Bounded Rationality

Dani Rodrik posted about an article which discusses the mainstream bias against heterodox economists. Fortunately, a commenter summed up some of my thoughts quite precisely, saving me the trouble of writing them out myself.

"What is true is that there is most definitely still is a 'mainstream' set of assumptions that are somewhat difficult to challenge and which translate into economists are conditioned as to 'what to think'. Try for instance to present a seminar where agents in your model have and exercise any form of market power and you will be immediately and repeatedly challenged (as the Card discussion above suggests). Economic rents are just not supposed to survive, and your audience will grill you until you surrender (if not in this seminar, in the next paper you choose to write).

But present the same seminar and begin with a likely even more improbable statement such as 'I will assume free entry, competition and zero profits in every sector' and it will probably slide by without challenge."

One could continue to question why the heretical challenges brought up by heterodox economists are quickly dismissed, while obvious impossibilities (boundless rationality) can be so easily accepted.

Monday, May 21, 2007

It's Not My Fault I Care About The Welfare Of People

I found an interesting article on Znet about the biological and neurological base for feelings of empathy. The article cites several studies that claim human feelings of empathy are products of evolutionary selection, more specifically that "There were evolutionary (survival) benefits in coming to grips with others"

Why then, if we all have these altruistic tendencies hard-wired into our basic neurological make-up, why isn't the whole world holding hands around a camp fire singing "Kumbaya"? Studies show that external factors - social, political, and religious - can override the fundamental empathic tendencies of humans. That is, we can be trained or manipulated to refute our natural behavioral inclinations.

One line, while really insignificant in the context of the articles purpose, really struck me:
"We know from neuroscientific empathy experiments that the same affective brain circuits are automatically mobilized upon feeling one’s own pain and the pain of others". I find the fact that the same exact part of the brain is stimulated in cases or both personal pain and in the case of being conscious of the pain of others is very interesting, and speaks about the natural response to suffering - that no matter who may be suffering it, it really affects us all the same. This means that there must be very intense belief systems that overwhelm the natural empathetic feelings towards others.

A huge conclusion that may be drawn from these studies is that
"the insidiously effective scapegoating of human nature that claims we are motivated by greedy, dog-eat-dog “individual self-interest is all” is undermined. Stripped of yet another rationalization for empire, predatory behavior on behalf of the capitalist mode of production becomes ever more transparent". If we all have this basic, underlying drive towards altruism or compassion, then any sort of avaricious nature must be a product of the system which we currently interact in. This, of course, assumes that there is another similar yet opposite drive for self-interest or self-preservation that is neurologically fundamental and always acts in opposition to the empathic drive. It is very possible that these conflicting drives exist as products of evolution and at times cooperate or act in harmony, but at other times act in dissonance. Either way, psychological studies are having an increased impact on economic studies, to which I say, "It's about time!"

We Seem To Be Doing Alright With Corrupt Governance

Dani Rodrik has a good post about corruption and how it applies to developing countries.

Developing countries seem to have obstacles in every possible sector that stand in the way of further growth. Despite the numerous problems they face, many people (economists, but the general population as well) focus on only a few issues, such as health, education, lack of free markets, and especially poor/corrupt governments. To focus solely on one issue, or even only 2 or 3 of these issues, misses the big picture. Development can't be pursued one sector at a time. It is trying to build a house of cards vertically instead of horizontally. When your building it, you lay down one level, then you slowly move up one level when the foundation is secure and complete. If you tried to build off a weak or incomplete foundation, the whole house will likely fall.