Eric Rasmusen’s Weblog

A quote from Michael Crichton via The Right Coast:

“Future environmentalists will heed Dietrich Dörner’s “The Logic of Failure.” Mr. Dörner is a cognitive psychologist who invited academic experts to manage the computer simulations of various environments (an African herding society, a town in Maine). Most experts made things worse. Those managers who did well gathered information before acting, thought in terms of complex-systems interactions instead of simple linear cause and effect, reviewed their progress, looked for unanticipated consequences, and corrected course often. Those who did badly relied on a fixed theoretical approach, did not correct course and blamed others when things went wrong. Mr. Dörner concludes that our failure to manage complex systems such as the environment reflects bad habits of thought, overreliance on theory and lazy procedures. His book is brief, cheerful and profound.”

We were having a discussion a few weeks ago in the law and econ lunch about why people think dead bodies are worthy of respect. Why is that I would mind if my corpse were thrown in a landfill instead of buried? Why would I mind if the bones of my grandparents were disinterred and used as decorations on someone’s wall? (more…)

Craig Duncan’s Ithaca College philosophy department working paper, “The Persecutor’s Wager” has an interesting wrinkle on Pascal’s Wager: its implications for religious tolerance. Suppose there you think there is a 1% chance that God exists and wants everyone to believe in Him exclusively and that you can choose to believe and make some others believe by persecuting or evangelizing. Pascal’s Wager says you should believe, because the reward is so high relative to the cost. Duncan points out that by the same reasoning, if you care about other people, as a good utilitarian or consequentialist you should persecute and evangelize them. Thus, even a weak possibility of an exclusivist God justified persecution. Another implication is that someone who believes in toleration must be willing to rule out any possibility whatsoever of an exclusivist God, a highly dogmatic opinion. The argument is subject to the same criticisms as Pascal’s Wager, plus, I think, the criticism that the exclusivist God may forbid persecution even if it would increase belief in Him, but it is an argument worth noting nonetheless. Duncan does a good job explaining it in his paper.

At the law and econ lunch yesterday we had a vigorous discussion of the effect on savings of having a sales tax instead of a income tax. It is an old theoretical question, but we were starting from the basics. In a world with a zero return on capital, switching to a consumption tax should not change anything. You can escape being taxed today if you save instead of consuming today, but since you will consume tomorrow what you saved today, you will end up paying the consumption tax anyway. So in that case, there is no incentive to change more. (more…)

Renege– to back upon a promise. Why is this word pronounced “rinig”, as we can see from this online dictionary or Merriam-Webster? “Rineg” is also a standard pronunciation, I see. “Reneg” is not hard to say, so that’s not the reason. A curiosity.

I’ve been trying to connect the Hausman Test to the Wald, Likelihood Ratio (LR) and Lagrange-Multiplier (LM) statistics. Here are my notes, which will interest only people who know quite a bit of statistics. Don’t trust them too far– these are the possibly confused ideas of a non-expert. But they might be helpful. (more…)

I found something interesting in “How to survive your first year of graduate school in economics at the University of California, Davis,” by Matthew Pearson (to be posted on the web sometime soon):

Impostor syndrome, or feelings of inadequacy It is quite common to feel like you are the only one not understanding the material, even when your colleagues impress upon you that their difficulties are significant as well. If you are struggling with feelings that you are an impostor, that you do not deserve or are not prepared enough to be here, remember that the admissions process works, and you are here for a reason.

That is a comforting thought. A person’s own judgement about himself is often flawed, and just as it can sometimes be humbling to realize that the judgement of other people is accurate in putting you in your current position, so also it can be encouraging.

Professor Bainbridge had a very good post in 2004 on how a university should evaluate blogging as part of a professor’s performance, a letter to him from Dean Mark Sargent of Villanova’s law school. I excerpt it below, but it is worth reading in full. I’ll put my own musings at the end. (more…)

I went on a two-day vacation to Mammoth Cave in January once. Despite lots of rain the first day, a temperature drop of 40 or so degrees the second day, and a daughter who came down with a fever, we had a very good time. The park is deserted in January, and we only had about 12 people on our cave tour (that is, my family and 6 others) and were only charged $50 for a room at the park hotel. I could get a double stroller from the parking lot down to the historic cave entrance carrying a girl on my shoulders, and the kids didn’t need to see much cave to be impressed. That is actually more rational than adults, since after you’ve seen the first mile of cave, the next 349 don’t look all that different. The real thrill of caving is in the irrational but delightful feeling that something amazing is going to turn up shortly, combined with the only slightly more rational but also entertaining fear that all your lights will go out and you will die in the dark. (more…)

Here’s an old post of mine on why Ashcroft removed himself from the Plame affair prosecution. I think it was prescient. (more…)

Via the Right Coast, I found a good Mark Steyn insight:

I underestimated multiculturalism. After 9/11, I assumed the internal contradictions of the rainbow coalition would be made plain: that a cult of “tolerance” would in the end founder against a demographic so cheerfully upfront in their intolerance. Instead, Islamic “militants” have become the highest repository of multicultural pieties. So you’re nice about gays and Native Americans? Big deal. Anyone can be tolerant of the tolerant, but tolerance of intolerance gives an even more intense frisson of pleasure to the multiculti- masochists. And so Islamists who murder non-Muslims in pursuit of explicitly Islamic goals are airbrushed into vague, generic “rebel forces.” You can’t tell the players without a scorecard, and that’s just the way the Western media intend to keep it.

Why would Moslem fundamentalists get more sympathy than Christian ones? I don’t know. This seems to be an indication that mere piety is not what is offensive to the Left. Perhaps it is opposition to one’s own past.

In the American Spectator I read of the suppression of liberty in Britain and Canada: (more…)

There is much grumbling about the growth of government under Bush. It is justified, but somewhat misguided. The most noticeable growth has been in domestic discretionary spending—”porkbarrel” spending on such things as roads and university projects in particular districts. That, however, is a relatively innocuous form of big government. It is wasteful spending, but not pernicious. It does not drag down the economy or restrict anybody’s freedom (except for increasing their taxes), or lead to greater government bureaucracy. (more…)

Genghiscan2@yahoo.com commented on an earlier post on Pascal’s Wager:

“Good works such as not cheating people, however, do not achieve salvation, according to the Christian Bible. Faith alone does that, and faith means not just belief, but a trust in and love for God.”

(more…)

Tom Smith points out a neat recursion:

To all appearances, Miers looks exactly like a liberal pretending to be a conservative. If the assessment of the Texas judges is correct, she is a conservative who just looks like a liberal pretending to be a conservative. However, if the Texas judges are just covering for her, then she would be a liberal who friends just say she is a conservative who looks like a liberal pretending to be a conservative, when in fact, she either is a liberal pretending to be a conservative, or would shortly become one, before she became just a liberal, which is my best guess at this point.

If you do maximum likelihood regressions, your computer regression package will usually give you something called the Pseudo-R2 to help gauge how well your estimates capture the variability in the data, in analogy to the R2 of OLS. But I have decided the Pseudo-R2 is too misleading to use. (more…)

From Shirona:

Ipcha Mistabra is an old fashioned expression used in
Israel. It probably has something to do with studying the
Talmud. Aramaic is close to Hebrew, with many of the same roots.
Ipcha, or Hipcha, is from the root Hey, Fay, Chaf. Hafooch in Hebrew
means upside down or inverted. Hahefech means the opposite, the
contrary. Mistabra is related to the word Mistaber, which means -
“probably”, “turns out to be”, or “it seems that…”. Put the two
together and you get something like - “turns out to be the opposite of
what you are saying”.

This photo is from the first meeting of the American Law and Economics Association, in Urbana in 1991. Posner, Coase, and Manne are in the middle. I’m there somewhere.