Shack Attack

Want Honors From Oberlin's Econ Department? Answer These Questions.

Steven Landsburg, author of The Armchair Economist (and more recently, The Big Questions), has a new blog, and it's pretty good. Today's post: five of the ten questions posed to prospective Honors graduates in the Economics department at Oberlin College.

Question 1. When the price of peanuts rises, Frieda reduces her root beer consumption. If Frieda’s income rises, will her root beer consumption go up or down?

Question 2. Bananas cost $6 apiece, except for members of the banana club, who pay $2 apiece.

• Given full knowledge of Thomas’s prefereces, explain how you’d compute his willingness to pay for a membership in the banana club.
• Given knowledge only of Thomas’s demand curve for bananas, explain how you’d estimate his willingness to pay for a membership in the banana club.
• Under what circumstances is your estimate an overestimate? Under what circumstances is it an underestimate?

Question 3. Snidely Whiplash owns all the grocery stores and all the houses in the Yukon Territory. He charges a competitive price for groceries, and rents the houses at the highest price residents (who are all identical) are willing to pay. (If he charged any more, they’d all leave town). True or False: If Snidely raises the price of groceries, he’ll have to lower the price of housing, so he’ll be no better off than before.

Question 4. Discuss the consequences for economic efficiency of giving your father a Barnes and Noble gift card, under various assumptions about how he uses (or doesn’t use) the card.

Question 5. Rank these taxes in order of how much you’d dislike paying them:

• A tax on consumption
• A tax on wages
• A tax on income (including wages, interest and dividends)

Assume that the tax rates are adjusted so that your total tax bill is the same in each case.

Answers can be found in the comments section of the original post.

Giving Thanks for Greed

Reacting to a post by Daniel Dennet expressing gratitude for the miracle of modern medicine Steven Landsburg muses about what really deserves thanks:

Add a word of thanks not just for goodness but for greed—the greed that inspired generations of inventors and investors, laborers and capitalists, doctors and nurses, technicians and scientists to envision and perfect such a thing as an artificial aorta, to educate themselves in the healing professions, and to show up for work every day. For the most part, they did it to make a buck.

We can be thankful too for the system that channels all that potentially destructive greed into life-sustaining brilliance. But we might temper our gratitude just a bit with a moment of wistful regret for the lives lost because of unnecessary imperfections in that system. As a society, we spend far too little on basic research in health care, largely because breakthroughs are under-rewarded. For one thing, our reliance on third-party payers (with the attendant loss of control over our own health care choices) makes us willing to pay handsomely even for relatively ineffective treatments, which diminishes the incentive for innovators to make treatments more effective.

For the sake of future Daniel Dennetts, I hope our legislators have the goodness and wisdom to devise a health care reform package that strengthens the incentive structure instead of weakening it still further. When they fail, as they probably will, there will be plenty of time for outrage. Meanwhile, things could be far far worse, and there’s much to be grateful for on this Thanksgiving day.

Well-said, sir.

The Final Stretch

I'm in the last phase of my senior thesis, the part where I actually sit down and type the damn thing up. It's about blogs, and in doing the background research, I found this great (if dated) essay on the history of the blogosphere:

Shortly after I began producing Rebecca's Pocket I noticed two side effects I had not expected. First, I discovered my own interests. I thought I knew what I was interested in, but after linking stories for a few months I could see that I was much more interested in science, archaeology, and issues of injustice than I had realized. More importantly, I began to value more highly my own point of view. In composing my link text every day I carefully considered my own opinions and ideas, and I began to feel that my perspective was unique and important.

This profound experience may be most purely realized in the blog-style weblog. Lacking a focus on the outside world, the blogger is compelled to share his world with whomever is reading. He may engage other bloggers in conversation about the interests they share. He may reflect on a book he is reading, or the behavior of someone on the bus. He might describe a flower that he saw growing between the cracks of a sidewalk on his way to work. Or he may simply jot notes about his life: what work is like, what he had for dinner, what he thought of a recent movie. These fragments, pieced together over months, can provide an unexpectedly intimate view of what it is to be a particular individual in a particular place at a particular time.

The blogger, by virtue of simply writing down whatever is on his mind, will be confronted with his own thoughts and opinions. Blogging every day, he will become a more confident writer. A community of 100 or 20 or 3 people may spring up around the public record of his thoughts. Being met with friendly voices, he may gain more confidence in his view of the world; he may begin to experiment with longer forms of writing, to play with haiku, or to begin a creative project--one that he would have dismissed as being inconsequential or doubted he could complete only a few months before.

As he enunciates his opinions daily, this new awareness of his inner life may develop into a trust in his own perspective. His own reactions--to a poem, to other people, and, yes, to the media--will carry more weight with him. Accustomed to expressing his thoughts on his website, he will be able to more fully articulate his opinions to himself and others. He will become impatient with waiting to see what others think before he decides, and will begin to act in accordance with his inner voice instead. Ideally, he will become less reflexive and more reflective, and find his own opinions and ideas worthy of serious consideration.

His readers will remember an incident from their own childhood when the blogger relates a memory. They might look more closely at the other riders on the train after the blogger describes his impressions of a fellow commuter. They will click back and forth between blogs and analyze each blogger's point of view in a multi-blog conversation, and form their own conclusions on the matter at hand. Reading the views of other ordinary people, they will readily question and evaluate what is being said. Doing this, they may begin a similar journey of self-discovery and intellectual self-reliance.

The promise of the web was that everyone could publish, that a thousand voices could flourish, communicate, connect. The truth was that only those people who knew how to code a web page could make their voices heard. Blogger, Pitas, and all the rest have given people with little or no knowledge of HTML the ability to publish on the web: to pontificate, remember, dream, and argue in public, as easily as they send an instant message. We can't seriously compare the creation of the World Wide Web itself with the availability of free technology that allows anyone with a web browser to express their unique, irreproducible vision to the rest of the world...can we?

In September of 2000 there are thousands of weblogs: topic-oriented weblogs, alternative viewpoints, astute examinations of the human condition as reflected by mainstream media, short-form journals, links to the weird, and free-form notebooks of ideas. Traditional weblogs perform a valuable filtering service and provide tools for more critical evaluation of the information available on the web. Free-style blogs are nothing less than an outbreak of self-expression. Each is evidence of a staggering shift from an age of carefully controlled information provided by sanctioned authorities (and artists), to an unprecedented opportunity for individual expression on a worldwide scale. Each kind of weblog empowers individuals on many levels.

The full thing is worth a read. Until my paper is done (it's due Dec. 8), I'll be pretty much off the radar. Two more weeks....damn.

Mr. Arber (yep, from Lowell) as Poster Child for Education 2.0

My former high school English teacher, Svein Arber, was mentioned in a Facebook blog post on educational use of the platform:

Svein Arber, a high school teacher in San Francisco, Calif., created a Facebook group to connect with his Advanced Placement (AP) literature class. Over the course of the year, students write posts on the group's discussion board to analyze the narration style in Phillip Roth's "American Pastoral" and debate whether a character in Albert Camus' "The Stranger" is fundamentally good or evil. Svein also uses the Events feature to remind students of due dates for assignments. "It's been very positive," he said. "I'm able to reach my students where they live."

Go Svein! If you're a Lowell student, or parent one, English classes don't get much better than Mr. Arber's AP 83/86.

Comcast Silliness

Me: "I want to login to pay my Internet bill, but you're asking for a home phone number and I don't know it. We rent, and we all just use mobiles."

Comcast rep: "I see that you don't have our Digital Voice Telephone Service. I see you do qualify, it's NOW available in your area, and if bundled could save you a ton from your current telephone bill. I would be glad to get more information on the promotions going on in your area if you like."

Me: "We don't have a phone in our house, so we don't need it"

Comcast rep: "Yes phones are included when you sign up for the Comcast Digital Voice Telephone services."

Need some rustproofing for that car you don't have?