Eric Rasmusen’s Weblog

There are lots of these “efficiency wage” models (beyond, of course, where the agent has some market power, so he bargains for a higher wage with the principal). Here are some:

1. Moral hazard. The agent must be given an inducement for high effort. If he is paid a high wage, on the threat of losing his job and future wages if he is caught shirking (whether with certainty or by auditing), he will work hard now even if his current wage cannot be conditioned on his effort. (more…)

Three Hierarchies puts it nicely:

I remember during the whole 2000 election brouhaha one commentator saying “Wacking the states over the head with the 14th amendment is what the Supreme Court does for a living” and it’s so true. But more specifically, let’s say that the kind of bills for which the SCOTUS wacks the states are almost always conservative bills (limits on pornography, limits on abortion, limits on flag-burning, and so on), so we could refine this and say, “wacking conservative state legislators and governors over the head with the 14th amendment is what the Supreme Court does for a living”. It would be nice to change that. The irony is that if you read the Federalist papers it is clear that original design was states and localities can legislate morals freely, but they can’t legislate regulation of the economy, and what we have now is essentially the opposite: states can regulate the local economy freely, but they can’t regulate local morals.

From T.S. Eliot’s translation of Pascal’s Thoughts, number 259: TS ELiot translation.
259:

Ordinary people have the power of not thinking of that about which they do not wish to think. “Do not meditate on the passages about the Messiah,” said the Jew to his son. Thus our people often act. Thus are false religions preserved, and even the true one, in regard to many persons.

One of the odd things in Genesis is that there are two similar stories about how Abraham pretends to be Sarah’s brother instead of her husband, out of fear of a king who admires her beauty. In Genesis 12 [+/-]Genesis 12 [12:1]Now the LORD said to Abram, "Go from your country and your kindred and your father's house to the land that I will show you. [2]And I will make of you a great nation, and I will bless you and make your name great, so that you will be a blessing. [3]I will bless those who bless you, and him who dishonors you I will curse, and in you all the families of the earth shall be blessed." [4]So Abram went, as the LORD had told him, and Lot went with him. Abram was seventy-five years old when he departed from Haran. [5]And Abram took Sarai his wife, and Lot his brother's son, and all their possessions that they had gathered, and the people that they had acquired in Haran, and they set out to go to the land of Canaan. When they came to the land of Canaan, [6]Abram passed through the land to the place at Shechem, to the oak of Moreh. At that time the Canaanites were in the land. [7]Then the LORD appeared to Abram and said, "To your offspring I will give this land." So he built there an altar to the LORD, who had appeared to him. [8]From there he moved to the hill country on the east of Bethel and pitched his tent, with Bethel on the west and Ai on the east. And there he built an altar to the LORD and called upon the name of the LORD. [9]And Abram journeyed on, still going toward the Negeb. [10]Now there was a famine in the land. So Abram went down to Egypt to sojourn there, for the famine was severe in the land. [11]When he was about to enter Egypt, he said to Sarai his wife, "I know that you are a woman beautiful in appearance, [12]and when the Egyptians see you, they will say, 'This is his wife.' Then they will kill me, but they will let you live. [13]Say you are my sister, that it may go well with me because of you, and that my life may be spared for your sake." [14]When Abram entered Egypt, the Egyptians saw that the woman was very beautiful. [15]And when the princes of Pharaoh saw her, they praised her to Pharaoh. And the woman was taken into Pharaoh's house. [16]And for her sake he dealt well with Abram; and he had sheep, oxen, male donkeys, male servants, female servants, female donkeys, and camels. [17]But the LORD afflicted Pharaoh and his house with great plagues because of Sarai, Abram's wife. [18]So Pharaoh called Abram and said, "What is this you have done to me? Why did you not tell me that she was your wife? [19]Why did you say, 'She is my sister,' so that I took her for my wife? Now then, here is your wife; take her, and go." [20]And Pharaoh gave men orders concerning him, and they sent him away with his wife and all that he had. (ESV)
the king is the Pharaoh of Egypt, and in Genesis 20 [+/-]Genesis 20 [20:1]From there Abraham journeyed toward the territory of the Negeb and lived between Kadesh and Shur; and he sojourned in Gerar. [2]And Abraham said of Sarah his wife, "She is my sister." And Abimelech king of Gerar sent and took Sarah. [3]But God came to Abimelech in a dream by night and said to him, "Behold, you are a dead man because of the woman whom you have taken, for she is a man's wife." [4]Now Abimelech had not approached her. So he said, "Lord, will you kill an innocent people? [5]Did he not himself say to me, 'She is my sister'? And she herself said, 'He is my brother.' In the integrity of my heart and the innocence of my hands I have done this." [6]Then God said to him in the dream, "Yes, I know that you have done this in the integrity of your heart, and it was I who kept you from sinning against me. Therefore I did not let you touch her. [7]Now then, return the man's wife, for he is a prophet, so that he will pray for you, and you shall live. But if you do not return her, know that you shall surely die, you and all who are yours." [8]So Abimelech rose early in the morning and called all his servants and told them all these things. And the men were very much afraid. [9]Then Abimelech called Abraham and said to him, "What have you done to us? And how have I sinned against you, that you have brought on me and my kingdom a great sin? You have done to me things that ought not to be done." [10]And Abimelech said to Abraham, "What did you see, that you did this thing?" [11]Abraham said, "I did it because I thought, There is no fear of God at all in this place, and they will kill me because of my wife. [12]Besides, she is indeed my sister, the daughter of my father though not the daughter of my mother, and she became my wife. [13]And when God caused me to wander from my father's house, I said to her, 'This is the kindness you must do me: at every place to which we come, say of me, He is my brother.'" [14]Then Abimelech took sheep and oxen, and male servants and female servants, and gave them to Abraham, and returned Sarah his wife to him. [15]And Abimelech said, "Behold, my land is before you; dwell where it pleases you." [16]To Sarah he said, "Behold, I have given your brother a thousand pieces of silver. It is a sign of your innocence in the eyes of all who are with you, and before everyone you are vindicated." [17]Then Abraham prayed to God, and God healed Abimelech, and also healed his wife and female slaves so that they bore children. [18]For the LORD had closed all the wombs of the house of Abimelech because of Sarah, Abraham's wife. (ESV)
it is the king of Gerer. In both stories, Abraham acts despicably. It’s natural to suppose that the compiler of Genesis wrote in two versions of the same story. But I realized, in thinking of how bad Abraham’s behavior was, that this evil provides an alternative reasonable explanation: Abraham saw that the deceit worked, and repeated it. He was afraid of Pharaoh, pretended to be Sarah’s brother, and survived. So, being afraid of the king of Gerer, he did it again, knowing that God would pull his chestnuts out of the fire.

This puts Abraham in an even worse light, but Abraham is just one of the many flawed “good guys” in the Bible. Jacob, David, and Peter are three others. There’s also Genesis 16 [+/-]Genesis 16 [16:1]Now Sarai, Abram's wife, had borne him no children. She had a female Egyptian servant whose name was Hagar. [2]And Sarai said to Abram, "Behold now, the LORD has prevented me from bearing children. Go in to my servant; it may be that I shall obtain children by her." And Abram listened to the voice of Sarai. [3]So, after Abram had lived ten years in the land of Canaan, Sarai, Abram's wife, took Hagar the Egyptian, her servant, and gave her to Abram her husband as a wife. [4]And he went in to Hagar, and she conceived. And when she saw that she had conceived, she looked with contempt on her mistress. [5]And Sarai said to Abram, "May the wrong done to me be on you! I gave my servant to your embrace, and when she saw that she had conceived, she looked on me with contempt. May the LORD judge between you and me!" [6]But Abram said to Sarai, "Behold, your servant is in your power; do to her as you please." Then Sarai dealt harshly with her, and she fled from her. [7]The angel of the LORD found her by a spring of water in the wilderness, the spring on the way to Shur. [8]And he said, "Hagar, servant of Sarai, where have you come from and where are you going?" She said, "I am fleeing from my mistress Sarai." [9]The angel of the LORD said to her, "Return to your mistress and submit to her." [10]The angel of the LORD also said to her, "I will surely multiply your offspring so that they cannot be numbered for multitude." [11]And the angel of the LORD said to her, "Behold, you are pregnant and shall bear a son. You shall call his name Ishmael, because the LORD has listened to your affliction. [12]He shall be a wild donkey of a man, his hand against everyone and everyone's hand against him, and he shall dwell over against all his kinsmen." [13]So she called the name of the LORD who spoke to her, "You are a God of seeing," for she said, "Truly here I have seen him who looks after me." [14]Therefore the well was called Beer-lahai-roi; it lies between Kadesh and Bered. [15]And Hagar bore Abram a son, and Abram called the name of his son, whom Hagar bore, Ishmael. [16]Abram was eighty-six years old when Hagar bore Ishmael to Abram. (ESV)
, where Abraham cravenly abandons Hagar when Sarah changes her mind. Abraham, the symbol of Faith and Promise, doesn’t become a hero of faith until chapter 22, with the sacrifice of Isaac.

1. A car radio that gets louder as the background noise gets louder, so that the listener continues hear equally well.

2. An amplifier for communication between the front and the back of a mini-van.

3. A sensor that tells you how much cumulative exposure to ultraviolet rays you have gotten at the beach. This would be like a radiation sensor, except that it could be reset at any time.

This article in Science is about experiments using 30,000 or so generations of bacteria to look at evolution. One lab found only one beneficial mutation in that time, but they found that 12 different populations all evolved to get the same fitness ina new environment, but using different methods and with different DNA. Here’s one excerpt to give the flavor:

Originally, Adams explains, natural selection favored mutants that had a souped-up appetite for glucose and so could outgrow its neighbors. But bacteria can metabolize only so much glucose; as their biochemistry got clogged with the sugar, the glucose-hogging mutants shunted the excess from aerobic metabolism to the less efficient anaerobic pathway, which generates a waste product, acetate. As Rosenzweig, Adams, and their colleagues described in the August 1994 issue of Genetics, the acetate buildup created a new ecological opportunity, and eventually a mutant emerged that could fill it: a new acetate-scavenging strain. Adams and his colleagues reported last summer in Molecular Biology and Evolution that the acetate scavengers appeared in six out of 12 populations they studied, and each time a mutation in the regulatory region of a gene that influences acetate uptake was responsible.

“It’s the first stage in speciation,” says Adams. “Diversity can exist even if you don’t seed it with something that can drive diversification.” And like other studies, this one shows that diversification is not only inevitable but also follows a predictable course.

This webpage is for things useful in celebrating the Thanksgiving holiday. For printing out to read at the table, see first-thanksgiving.pdf , more-proclamations.pdf, 2006.proclamation.pdf, and We-gather-together.pdf
See also the page on original Thanksgiving foods via James Lindgren.

When a person is thankful, he is of course has to thanking someone—”to thank” is a transitive verb, requiring an object. Thanksgiving is a time to thank God, as the government proclamations traditionally say. These proclamations make nonsense of the claim that the American Constitution forbids a place for Christianity in public affairs, though it is noteworthy that Thomas Jefferson, unlike his two predecessors, refrained from issuing any Thanksgiving Proclamations. The 2006 Presidential Thanksgiving Proclamation is here.

Below are excerpts from some Thanksgiving proclamations from across American history.

The Council has thought meet to appoint and set apart the 29th day of this instant
June, as a day of Solemn Thanksgiving and praise to God for such his Goodness and
Favour, many Particulars of which mercy might be Instanced, but we doubt not those who
are sensible of God’s Afflictions, have been as diligent to espy him returning to us;
and that the Lord may behold us as a People offering Praise and thereby glorifying Him;
the Council doth commend it to the Respective Ministers, Elders and people of this
Jurisdiction; Solemnly and seriously to keep the same Beseeching that being perswaded by
the mercies of God we may all, even this whole people offer up our bodies and soulds as
a living and acceptable Service unto God by Jesus Christ. (1676, Connecticut)

(more…)

Here is a new art form. Use ink that is not waterproof, and dampen the napkin.

Gender-neutered writing is a common irritation of academia. Instead of the generic “he”, scholars write “he or she”, or alternate between “he” and “she”, or use “they”, or find indirect ways of avoiding the pronoun altogether, or use “she” alone in an attempt to balance the hundreds of years of writing that use “he”. This has the effect of castrating their writing— or perhaps, more precisely, reducing its potency, since there degrees of harm to it. “He or she” is verbose, “they” and indirect ways obscure meaning, and alternation or “she” alone are constant burps in the writing as the reader runs into each oddity and thinks to himself, “Ah, feminism again,” either with pleasure at the political sentiment or irritation at the political advertisement. (more…)

Jean Tirole has a nice example illustrating the hold-up problem and authority in his I.O. book. Here is the game, modified somewhat. I wrote up five pages of notes exploring it for my G601 class, and I’ll post them here now in case anybody is interested and so I’ll know where to search for them if I need them. (more…)

Why is it that we see so often that a man’s wife supports him in graduate school, but not his father or his brother? It seems people are more willing to put their wives to work than to rely on their families, and, I suppose, the families, though much richer, are less willing to help than the wife. Or, perhaps, it’s just that the wife can be made to work, but the father or brother cannot be made to provide money.

We were talking about what justice is at the law-and-econ lunch this week. One professor specifically ruled out religion as a source of justice, but of course that’s wrong, and the Bible is perhaps the only really reliable source outside of our own human selves. Can we, then, look at Biblical law as an indication of some things that are just, as a starting point? Here is a passage from Exodus that illustrates the data and the problems that arise: (more…)

What is a firm? It is a collection of assets with one owner that contracts with other assets to produce and sell goods. An example might be a steel company we will call Apex: a steel blast furnace owned by one man who hires workers to produce and sell steel. But this is too easy. We do not say that the iron mine which sells to Apex and other steel companies is part the same company as Apex. We could say that blast furnace by itself is Apex, but that neglects the value of its relationship with its workers. (more…)

After hearing George Fletcher lecture at a LEC institute in Florida, I think
maybe I understand Kant. His principle is Authority supporting Dignity.
Happiness matters not at all. What he wants is to maintain a person’s dignity,
as if all people were aristocrats. If that means unhappiness for everyone, so be
it. Moreover, not just anyone can support dignity. You may not, contrary to a
true aristocratic code, kill your enemy by yourself. Rather, a legitimate
authority—THE legitimate authority of the state, must do it. This rather
undermines dignity, of course, since it makes everyone helpless serfs of the
State, but Kant is not strong on consistency. He is a creature of the
Enlightenment, abandoning religion and past philosophy in favor of a new
creation of his own, but trying to raise himself into the highest rank of
humanity, the baron, and to bring the baron down to his level. He equally fears
God and Hume, divine law and bourgeois compromise, revelation and common sense.

I was culling books from my library and on seeing Baltic Literature, I remembered the kindly old Estonian poet Aleksis Rannit, whom I knew at Yale. I met him at a Branford Master’s Tea, I think, where he was talking about translation and I wrote him some notes with my opinions. I met with him several times, and met his wife. He was a gentle man with a fondness for the poet H.D. and her other-worldly, Apollonian style. I couldn’t find a picture of him on the Web, alas, but I did find a catalog of his collected papers and this poem from Lituanus, 1980:

DIOSKORIDES — TO BYRON

Stay,
    poet of thunder,

hear through my silence
                                    and
know:
dearer to me
                   than
lightning
the syllables’
                    gradual

                               flame.

I was at a conference at Harvard Law Friday on comparative law. One paper talked about the old issue of whether the common law is more surplus-maximizng than statutes. Here is something I thought of.

Suppose everybody is
unbiased, but they do make mistakes, pareto-worsening mistakes, in making law.
Legislatures make broad rules every few years— seldom, because it is so costly
to get on the agenda and go through all the committees and compromises and
staffwork. Judges make narrow rules continually, based on individual cases
(which is why the rule is narrow).

When the legislature makes a rule that everybody immediately sees is stupid, it
won’t be changed for a few years. When a judge does, the next judges will
interpret it narrowly.

Legislatures know this is a problem. So often they leave their rules broad but
vague (US antitrust statutes) and let the exec agencies and judges create the
specific rules one by one, narrowly. This leaving of some laws to the judges is
a recognition of the superiority of the common law for nonpolitical rules.

Somebody pointed out another advantage of judicial law: it can be overruled by statute. Judges don’t have to overrule bad precedents themselves, because the legislature will do it. But judges are not supposed to overrule statutes, except on constitutional grounds (which is going beyond the common law).

Here is a troubling passage:

And he said unto them, Go ye into all the world, and preach the gospel to every creature. He that believeth and is baptized shall be saved; but he that believeth not shall be damned. (Mark 16:15-16 [+/-]Mark 16:15-16 [15]And he said to them, "Go into all the world and proclaim the gospel to the whole creation. [16]Whoever believes and is baptized will be saved, but whoever does not believe will be condemned. (ESV)
)

Does this rule out any possibility of salvation for the virtuous pagan?

Well, maybe not. We don’t think that baptism is necessary for salvation, which is the literal meaning of this passage. Nor do we think that animals (”every creature”) should believe and be baptized. So I think we can leave it as a general statement that those who believe when they first hear the Gospel have a better chance than those who do not. Whether that “better chance” means positive instead of zero is left unresolved.

In 2004 there were reportedly 405,000 Roman Catholic priests worldwide, for 220,000 parishes and 1.114 billion members, which comes to 2,750 members per priest. (There are 43,000 priests in the United States for the 65 million Catholics, 1,511 per member.)

There seem to be a lot more Protestant ministers than Catholic priests. The United Kingdom alone has 34,000 ministers and 48,000 churches, I read here. And the U.S. government reports that there are 403,000 people whose occupation is “clergy” (which includes the 43 thousand priests). So the U.S. clerical population is just about equal to the worldwide number of priests.

I wonder if in gauging the size of a denomination it might not be better to use the number of clergy than the number of members or “population”. It is too easy to count people as members, and perhaps everyone in a country of which Catholicism is the official religion is counted. That might be legitimate, but it means that many members are people who never enter a church.