Saturday, March 17, 2007

War, hmm, what is it good for?

I was at the Iraq War protest today, not because I'm civic minded, but because a professor paid me to hand out surveys. I'm not sure the questionaire will capture the eccentric nature of this crowd, so here's my unscientific analysis:

30% nice old '60s era hippies.
30% eerily silent but angry middle aged types.
30% Ewoks.
10% mentally deranged.

I gotta tell you, it didn't help firm up my anti-war sentiment. In the language of Adam Smith, there was no fellow-feeling there. Also, hardly any blacks. The one black guy I randomly selected marked himself down as white.

Friday, March 16, 2007

Conspicuous consumption or conspicuous saving?

Tyler writes about how Veblen has come back into vogue. Veblen saw status-seeking as essentially inefficient. (And he thought engineers could somehow fix this? The arrogance of his generation continues to astound me.) I think status-seeking is always about accumulation of that which is scarce, be it SUVs, Chinese art, or economic knowledge. It's never been fashionable to accumulate air. Status-seeking increases demand for that which is scarce, and so induces production, which mitigates the effects of scarcity, i.e. high prices.

Veblen found the "conspicuous consumption" of the Gilded Age repulsive. I guess the flourishes of Victorian architecture offended his Scandinavian sensibilities. But think of how this period stands out amongst the blandness which preceded it. How much of colonial architecture is really striking? Monticello, you say. I say it's an out of proportion rip-off. As is Mount Vernon. There are a few notable ante-bellum mansions in the South, and New Orleans is exceptional. That's where the money was. But my sense is the North was really lacking in this department, e.g. the row houses of Philadelphia are today the only boring thing about that town. The Gilded Age came along to fix all that, and status-seeking was the mechanism.

That we're able to still enjoy Victorian architecture means this wasn't really conspicuous consumption, it was more like conspicuous saving. I think this is typically the case with status goods, because much of what we produce is durable. Even when we blow a bunch of money on an SUV, which looses 20% of its value when driven off the lot and then quickly becomes a pile of rust, it serves to advance technology. When we splurge on an expensive meal, it spurs the invention of recipes. When we get PhDs in literature or, dare I say, economics, where probably most dissertations are only ever read by the dissertation committee, still some of them will change the world.

In short, I suppose knowledge of Veblen has become too scarce, and so status-seekers have become his exponents. Thank God the engineers haven't prevented it.

Friday, March 9, 2007


So, this is the longest I've gone without posting. I sort of gave it up for Lent, or at least the obsessive-compulsive urge to post everyday. Now you'll just get extremely lengthy posts whenever I feel like it. At least during Lent. The change of format is the result of a rather exceptional experience I had this past weekend at All Saint's Sisters of the Poor, an Anglican convent in Catonsville, Maryland. For those who don't know me well, this is not my typical weekend activity. But Sammy recommended it to a group of us at church, and I'm very glad he did. I'll try to relate it to you, just the interesting parts, hopefully.

Sister Catherine Grace told us to focus on stillness, which I suppose is to be expected at a convent. She recommended we wander around the property and observe nature. Something about the place was so serene and absolutely quiet (the picture doesn't convey it). She told us how she gave up all her possessions and joined the convent 45 years ago. She talked about the different kinds of people who have come through. It was a home for disabled children, and a hospice center, and now a retreat. She talked about the three strangers who came to die there, each prejudiced against the other, and how they became inseparable friends, and died within 4 hours of each other.

The guest house was full of interesting literature. I read some of the newsletters, tucked away in a bin labeled "Christian vices." These jumped out at me:
1) curiosity
2) self-expectation
3) pride
To the extent curiosity is self-serving, it is a sin. If it interferes with one's relationship with God, it is a sin. The same goes for self-expectation and pride. Clearly, these are virtues to most people, especially academics. So are the sisters just a bunch of fringe nuts? No, I think they are living consistently with an essential element of Christianity, which is the death of self. The ultimate story of selflessness is, of course, the life of Jesus.

I'm a believer, so this has meaning for me. It effects my incentives. And I'm pretty sure I'm not the only one. This is why I think economists should pay attention to religion. That's what I've been doing this week, while trying to keep the curiosity, self-expectation, and pride from consuming me. Are you sensing the cognitive dissonance? Larry Iannaccone says the scientific study of religion demands methodological atheism. F. Scott Fitzgerald said the mark of genius is the ability to hold simultaneously two conflicting ideas. Maybe that's why so many geniuses kill themselves. They run into their other persona and it scares the shit out of them. I don't think very many of us are geniuses, certainly not me, and I think even geniuses can't fully separate their sensibilities from their rational thoughts. Economists pretend to be objective, probably largely to signal intelligence, but it generally just results in deception and bias (see Dan Klein for more on this). However, I think figuring out the degree and the context in which people can become objective is important for economists, as that is the domain in which our models work best, and beyond which, we need to augment the theory.

Addendum: Here's what G. K. Chesterton said about it:

The ordinary man has always been sane because the ordinary man has always been a mystic. He has permitted the twilight. He has always had one foot in earth and other in fairyland. He has always left himself free to doubt his gods; but (unlike the agnostic of to-day) free also to believe in them. He has always cared more for truth than for consistency. If he saw two truths that seemed to contradict each other, he would take the two truths and the contradiction along with them. His spiritual sight is stereoscopic, like his physical sight: he sees two different pictures at once and yet sees all the better for that.