Best Alternative To New Entertainment

I didn't expect to particularly enjoy the new Star Wars movie. The franchise is hoary. It bears the weight of nearly 40 years of cruft. We finicky old-timer fans expected Wonder Boy JJ Abrams to not only atone for past sins, but to put aside a few of his own signature cinematographical signatures to revive the modern Prometheus. I expected something flashy, mostly devoid of substance. I expected a 2 hour-and-change music video with Wookiees. I basically got what I expected. I even got a few nods to the extended universe, which surprised me since Disney explicitly jettisoned the novel series when they acquired the rights.

I didn't expect to particularly enjoy the new Star Wars movie, but I did expect the kids in the audience to. I was six years old when Empire opened, just about the ideal age to truly lose myself in Hoth, Dagobah, and Bespin. I was the right age to beg my parents for the Kenner toys that unfortunately lacked the joint articulation seen on the superior G.I. Joe action figures (woe betide any who dared call these toys by their hidden, secret name: dolls). I would run around the dirt lot, swinging sticks and making whooshing sounds with my mouth trying to mimic lightsaber foley. It occurs to me now that I wasn't so much in love with Star Wars as I adored being a kid. Because being a kid is pretty awesome. Most of the time.

But Star Wars filled an entertainment void, doncha know. 1980 also gave us Raging Bull, Airplane!, The Shining, Ordinary People, The Big Red One... here, look for yourself. Conspicuously absent are movies aimed at the young teen crowd. Hollywood was mostly busy catering to Baby Boomers. Rightfully so, too. Go where the money is. Go where you can please the most customers. If you're old enough to have outgrown Disney, tough nuts, pal. Deal with it. Go ride your bike.

Things are considerably different now. Marvel is actually making superhero movies that don't suck tepid cat piss (have you seen the trailers for Civil War? Of course you have. They have to cast Carol Danvers one of these days. I wonder who they'll get). Online streaming services let you binge-watch extended-form episodic content that embarrass what passed for television in the early 1980s (I challenge you to attempt to re-watch Dukes of Hazzard or The A-Team with older eyes). And video games? 2 hours and 16 minutes in an IMAX theater is a nice little wasted afternoon, but I can promise you that this time next year, I will remember the names Evie and Jacob Frye, but I'll probably have forgotten Kylo Ren and Poe Dameron.

Put simply, there is simply too much competition for Star Wars to catch the 1977 lightning in a bottle. Fans have remarkable alternatives. So yes, I expected the target audience to get a kick out of the movie, but when I saw the kids just milling around bored outside of the theater after the show, I suppose I shouldn't have been too surprised. We live in an age of wonders, after all. It's easy to abandon wonder in the midst of non-stop magic.

I Know Why the Caged Black Canary Sings

I'm old enough to have accumulated journeyman's badges in a number of fandoms over the years. I cut my NBA teeth on the Lakers/Celtics rivalry when it meant something, practicing my skyhook in the driveway decades before the term was appropriated by one Mr. Booker DeWitt. I'm just scarcely enough of pop/obscure film buff that I am happy to bore you to tears with a comparative analysis between the career arcs of Cedric Hardwicke and Alfred Molina. I'm conversant enough in tabletop gaming to know the important differences between GURPS and d20. But I can't tell you much about the starting lineup of the 2015 Heat, nor spew encomiums to Robert Wise, nor recount the details of the Horus Heresy. At least not without looking it up first. The Internet is great for looking smart to strangers over Twitter.

So it is too for comic books. I've been on the periphery of fandom since I was a teenager. I remember TMNT from when it was still a dorm room book mocking Frank Miller. I remember watching as the King of Dreams took John Constantine's nightmares of Newcastle from him. I remember how living wizard Alan Moore set the medium ass over teakettle with a pitch-perfect deconstruction that somehow got turned into a plastic, summer, popcorn film adaptation. Yet for all that, I don't think I could name a single graduate of Xavier's Academy for Gifted Youngsters who hasn't appeared in either film or video games off the top of my head. So you can imagine how it is the CW melodrama Arrow and its other licensed properties appeal to me. They're perfect for casual fans who know just enough canon to know the names Merlyn and Thawne, but aren't quite attached enough to get all bent out of shape by the Flashpoint arc or by what Wanda did in House of M.

I also remember John Wesley Shipp as Barry Allen. In fact, I remember the 90s run of The Flash as being one of the best things on television at the time. In the interest of avoiding S1 spoilers for those who've yet to binge it on Netflix, I'll just say the show writers gave a continuity nod to the earlier iteration and it was clearly made in the Tim Burton-digests-Batman era of DC properties on screen. "Less campy than Adam West and Burt Ward" is accurate, if not particularly informative. The Arrowverse has a low bar to clear is what I'm saying here. And they've cleared it fairly well. At least for a superhero show made by a network whose demographic appears to be teenage girls.

It's that demographic that allows me to overlook the non-stop shipping. I understand how it might be important to some viewers which characters end up in romantic relationships with other characters. If I want just the punching, ma'am, I can stick with Daredevil. Or hope that the MCU jettisons Whedon (#sorrynotsorry). I have a harder time excusing other cinematic sins. For example, epinephrine is not even remotely a "close enough" substitute for lidocaine. Swords emerge from scabbards quietly. Pistols don't rattle. Grand jury hearings do not proceed in that manner. A boxing glove on the end of an arrow is incapable of knocking a grown man on his ass. You. Don't. Shock. A. Flatline. But for all these sins, they did get one important thing right.

Minor-to-negligible S3 Arrow spoilers follow.

There's an AA scene. One of the principal characters listens as an extra recounts how her boyfriend beat her up again when he was drunk. After the meeting, this principal character tells her father that she wishes she could use that information to sic the police on the abusive boyfriend. The father responds with a sentiment that any economist would instantly recognize: the moment you start sending cops to AA meetings is the moment the drunks stop coming.

In economics, we call this the "Lucas Critique." It's a way of saying that things that start out as measurements have a frustrating tendency to become targets. People adjust their behavior when they think someone's watching. If GDP is an international contest rather than simply a metric for the strength of an economy, vainglorious political elites have an incentive to build gigantic Potemkin cities, complete with uninhabited skyscrapers and empty roads. Corporations filing annual reports will gently massage balance sheet items of interest, squirreling disastrous unfunded liabilities or eventual goodwill damage quietly away in the comments.

Maybe it's just me, but I find it funny that a screenwriter who has no problem insulting the audience with the ol' "it's just a flesh wound" trope gets a very important social science point right and to do so with an economy of dialog that I have not endeavored to mimic in today's post.

Women in Economics on Film

Media Matters on gender bias in economic reporting.

The relevant chart:

Male economists get more media appearances than female economists.

After Justin Wolfers shared this on Twitter yesterday, a few folks (including Nathaniel Bechhofer, Claudia Sahm, and your humble author) forwarded some hypotheses to explain the imbalance. Among them:

1. News organization taste-based discrimination: news studios don't like female economists and are therefore reluctant to invite them on the air.
2. Audience taste-based discrimination: producers don't think Joe and Jane Six-Pack are interested in hearing women talk economics, and are therefore reluctant to invite them on the air.
3. Participant selection: female economists respond affirmatively to appearance requests at lower rates than male economists.
4. Specialization: female economists select areas of concentration that may not be newsworthy (experimental econ, industrial organization, & al.)
5. A combination of the above

On hypothesis (1):

Pro-

• The stereotype of newsrooms being old boys' clubs persists, and even if there's no truth to it, there might be lingering heuristics that link economics to men, much like the heuristic that nurses or flight attendants are female. The bias doesn't have to be pernicious or conscious to work.

Con-

• Maladaptive taste-based discrimination has a short shelf life. Producers have an interest in maximizing ratings. If they can steal a few eyeballs by inviting incisive female economist guests on their show, they'd be derelict in their duty to shareholders not to.
• Speaking in my capacity as an insider to the profession, female economists are on average more attractive than male economists. Television appearances are partly about substance, but style matters too. Even if I were in the same intellectual league as Claudia, I'd expect that producers would still invite her over me. She's pretty. I'm not. Then again, maybe there's a bit of moral balancing going on there too. Brains and beauty could possibly alienate mediocre viewers or something. 

On hypothesis (2):

Pro-

• There is a gender imbalance in economics, but it's nowhere near as severe as it was even as recently as 50 years ago. If audiences expect economists to be male, they may react with sentiments along the lines of "who the hell does this broad think she is?" at their worst or "silly girl, business is a man's game" if they want to swap out rancor for condescension.

Con-

• The left more or less won the culture war. The idea of Middle America being a bunch of knuckle-dragging troglodytes stuck in 50s-era gender roles is a myth with very little basis in the survey data I frequently work with. However, recall that it's less a matter of whether or not the audience is enlightened and more whether or not programming directors believe that the audience is enlightened. The correlation there might be less than 1.

On hypothesis (3):

Pro-

• On average, women tend to be less confrontational than men and may therefore display a tendency to avoid media appearances that often devolve into bowtied shouting matches.
• Female economists may tend to value media appearances lower compared to male colleagues. If there's an ego component to being on TV and women don't get as much out of having their ego stroked, they may have a higher propensity to reject offers.

Con-

• Attend an AEA meeting or two. Tell me that after selecting for the economics profession that tenured female economists avoid confrontation. Ditto for the ego point (NO, I WILL NOT NAME NAMES. Don't ask.)

On hypothesis (4):

Pro-

• It's at least plausible. And of the hypotheses I've offered here, the easiest to test. 

Con-

@Spivonomist @bechhof @JustinWolfers counter ex: labor markets are big deal & there are lots women in labor economics...yet who 'experts'?
— Claudia Sahm (@Claudia_Sahm) January 13, 2015 

In all, I'd expect some mixture of these hypotheses to be true (and probably a dash of something-or-other I've omitted). Luckily for this question, there are indeed clear, testable hypotheses to help folks get at the underlying dynamics that could produce such a chart. Unluckily, the typical punter might be inclined to take it as prima facie evidence that there's something scurrilous afoot in economics journalism. Something not-quite euvoluntary even.

Compared to the alternative of state-mandated quotas, I'm fond of naming and shaming. However, it might be worth taking a little time to see if we point our fingers at the right targets before doing so. Assuming a conclusion is bad form in the peer-reviewed literature. It's no better form in activism.

False or Unfalse

I am a child of my upbringing, so when I think of statements that cannot be falsified, my thoughts inevitably turn to Mr. T and his stern warnings about the perils of jibber-jabber. Indeed, I pity the fool who listens to anyone making weaselly, motivated, partisan claims about stock market movements, alleged effects of policy on quarterly growth, or spurious remarks about employment rates. In short, most of what passes for financial or economics journalism is so obviously tripe that I honestly have to wonder at the good sense of the people who consume it.

"The stock market rallied following blah blah blah from the President today" is less informative than the nether bellowing of a porcine oaf. At least in the event of a noisy fart, listeners can conclude that at one point, the issuing individual enjoyed a fine meal. With financial soothsaying, the wind and volume accompany nothing.

So here's the common-sense jurisprudence question: should market-watching geese be subject to false advertising statutes? If their inane proclamations induce individuals to trade based on naught but empty bellows, shouldn't they bear some liability? Or is the soul of commercial regulation located only in the profit center? Does it matter whether or not commercial speech is made by a third party who does not stand to profit directly?

If it does matter, what does that say about citizen jurisprudence towards third party review sites like Yelp or Zillow or whatever?

The public (and the Supreme Court) have already decided that some forms of commercial speech are not protected by the First Amendment. If deception were the only issue, most financial journalists would be liable in tort. It appears that you need to combine deception and profit-seeking to run afoul of the popular sentiment. Curious.

Pole Tax

On Twitter, E.N. Brown asks:

Hey, #sexwork twitter: Any thoughts on Nevada declaring strippers employees, not independent contractors, who must be paid minimum wage?
— Elizabeth N. Brown (@enbrown) October 31, 2014

Concatenated, EE friend The Honest Courtesan replies: "I think it'd be better to leave them as contractors, but stop TREATING them like employees & cash cows. The biggest problem is that clubs SAY they're contractors, then charge extortive fees & impose draconian rules."

A glib take: the Uber of exotic dancing already exists, and it is called "escort services." The physical property of the gentleman's club (614 Wharf Ave.) acts as one or more of the following:

• A clearinghouse: it provides a centralized location to match clients with performers. A customer might want something in particular, but the act of browsing helps define specific desires. Nota bene, this works both ways. In a club, performers can quickly visually screen customers before approaching for private dances. Call-in services oblige escorts to haul clear out to the site before assessing whether or not the client is tolerable.
• A (for lack of a better term) sacred space. This land is for a single purpose. There may be libation here, but this is not where we drink. There may be food here, but this is not where we eat. There may be music here, but this is not where we go to get our Creedence fix (brb, getting my Creedence fix). This place is the place to see undulating flesh. This place is the place to be on the business end of an inviting smile. This place is the place to feel a tempting, inviting touch, to smell forbidden musk, to hear gracious lies, to forget your loneliness for a little while. This place is a place of great glamour, in the old sense of the word: a gratifying, glimmering shared falsehood that lifts the weight of the world if but for a fleeting moment. It is an important, valuable space and should be kept as such. 
• A warren. This is the less-charitable interpretation of the "sacred space" interpretation. Like it or not, a great many people are simply disgusted by sex work, no matter how sanitized or discreet it might be. Zoning legislation keeps exotic dancing segregated from the God-fearing, pearl-clutching types. I see quite a bit of this here in my uptight Northern Virginia suburban corridor. I won't Google any addresses here at my work machine, but I'm fairly certain that I'd have to make my way clear to DC to see a dancer half my age swivel her hips in my direction. The median constituent in my neck of the woods has uttered a pretty unambiguous "nope" towards pole grindin'. 
• A place of ordinary business. Payment for services rendered, like at the dentist.

Club owners can get away with extorting dancers because of the aforementioned land use restrictions (and if you think Nevada is some sort of free-for-all when it comes to opening a strip club, you have another think coming). In the terms of econ 101, clubs provide a rent, and the rents are generated by way of the first three above bullet points. The value added to the client, to the performer, and to the community accrue to the residual claimant, which under the ordinary rules of organization is usually the property holder, the person with his (and don't kid yourself, it's usually a man) name on the title deed.

Typically, Ray keeps the [value] streams separate through multi-part tariffs. The cover charge and the drinks minimum goes to the club owner, the dancers get their tips (or some fraction after they tip out the DJ and staff [I presume]). The details almost certainly vary from venue to venue. The idea of treating dancers as independent contractors renting out space is actually quite a clever one—by paying a fixed charge to perform, the club obliges dancers to deliver de minimus that much value to the clients, thereby increasing the prestige of the club. Paying wages and heavily garnishing tips gives dancers an incentive to shirk (on the margin) and to hide tips (on another margin). Shirking and evading is evidence of a hostile relationship between owners, performers, and clients. This is less euvoluntary than a situation of mutual respect and service.

How to collect and distribute rents is a matter of negotiation. The minimum wage idea is perhaps one way to get to a just outcome, but it isn't the only one. Relaxed land-use regulations help to strip the location premium from the owner. Re-formatting the multi-part tariff might also help. Most of all, it's important to recognize which property rights regimes lead to the most efficient allocation of scarce resources. Treating exotic dancers like factory workers is probably a lousy approach. Then again, treating factory workers the way they're typically treated is no great shakes either. Hm.

Obligatory:

Pay to Play: There's Bologna in our Tight End

The first time I recall learning about Pay or Play contracts was from the Animaniacs theme song. I was surprised to find that it's a real thing.

And now we find that a related contract (long in use in the exotic dancing circuit) has been floated for the Superb Owl: big name artists are being asked to pay (follow the links! follow the links!) for the privilege of performing at halftime.

The idea is pretty simple: Rihanna gets a bigger boost in sales out of the gig than the NFL does, so remuneration flows accordingly. Fair is fair, after all.

Of course, fair isn't fair when one party to the contract is a giant organization. If Forbes is correct, the 32 teams in the NFL are worth, in toto, close to $46B. Rihanna, in contrast, is worth a (relatively) measly $120M. Talk about a BATNA disparity!

Sure, there are probably only a handful or two of bankable performers who'd be a good fit for the Superb Owl halftime show (for my money, it's long past time for Weird Al to hit the stage), and each one of them is more than well-off enough to tell the NFL to stick it where the sun don't shine.

But the brutal economics don't lie. If a performer gives up the spot to someone with a little less pride, it could well mean leaving money on the table. What price pride? The typical high-performing musician has much less audience goodwill to squander than the NFL, and maybe that's what Goodell's counting on.

It's tough to feel sorry for a mammoth organization with abundant assets, even when they have the economics on their side.

Then again, it's just an offer at this point, right? Lowballing is a common practice in negotiation. Maybe they'll agree to bump it up to 0. Who knows?

Intellectual Pork Rinds

In a post heralding the pending Adamularity, The OG excoriates intemperance in media consumption. Just as too many mini-muffins and Funyuns can enporkulate your jiggling posterior, popular media is at once rewarding while you consume it, and destructive the more you indulge and the longer the habit persists.

And in another devious parallel (assuming Straussian intent in Adam is probably not far off the mark), both gorging your corpse and your mind suffer from pretty dreadful pecuniary externalities. To wit, if the taxpayer is obliged to pick up the bill for Corpulent Sam's Eternal Snacking, and if this obligation is exogenous, then there is a public interest in imposing dietary restraint on the less temperate among us. Symmetrically, if constituents suffer political risk from Mad Mike's Media Malingering, then there is a public interest in, say, arresting climate change deniers.

Free speech ain't so free. Or, if you prefer, yikes!

The crux is whether or not the policy is exogenous. If the taxpayer isn't on the hook for my snackological protocols, I'm more generally at liberty to stuff my craw as I see fit (nb, this cuts against farm subsidies [particularly mega agribusiness] a lot harder than against SNAP restrictions). Ditto a free press. A state that restricts its operations to enforcing the natural rule of law rather than disseminating party favors to the mess of tatterdemalions, rogues, pettifoggers, lickspittles, louts, knaves, clods, cluttermidges, churls, and skiddermarks under their weal can far more graciously suffer a clamor of saffron journalists. 'Tis no accident that state-provided media is a staple of dictators.

The press is not euvoluntary in a big, big way. How we approach our moral intuition towards it depends in no small part on the role it plays in forming policy opinion. A sensible, Bayesian precautionary principle hints that perhaps a natural immunity to the shenanigans implied by the First Amendment can be discovered when the sovereign more closely hews to restraint rather than the profligacy that so characterizes its many functions. Small steps to a more euvoluntary world, people.

The APEEmath vol 3: Antony Davies Visits NCC 1701-D

Spivonomist's Log Stardate -308719. We are in orbit of APEE 2014. Professor Antony Davies presents some of his work on the economics of science fiction worlds, culminating with this photo, which instantly joined the ranks of the Greatest Things Ever Seen At An Academic Conference. Enjoy.

The Campbell's Condensed version of his thesis is something like this: in the Star Trek universe, material scarcity has been overcome, but this does not and cannot overcome the key scarcity problems we analyze using the tools of economics. Choice still exists, as time and attention are scarce. The Enterprise can only seek out and explore one new world or one new civilization at a time.

Extend this idea to other genres, and we're still faced with unavoidable scarcities of time and attention. One of the vampire tropes is that despite being immortal, they end up bored of their dreary, repetitive existence. Thanks to immortality, the frantic pressure felt in a fleeting, brief life is gone, replaced by ennui and tiresome internal politics. Or something. Davies (obliquely, in his presentation) argues against this trope, noting that an infinitely long life does not grant a non-omnipresent entity access to more than one experience at a time. It does grant them copious wealth thanks to compound interest, but that's another matter entirely.

The only creatures in the Star Trek universe who've successfully overcome the economic problem are The Q, and this tends to be played as writer-indulgent pathos-cum-comedy. More frequently, the extensive use of applied phlebotinum means that the writers get to explore themes of racism, environmental degradation, international[planetary] relations, and in the guise of the Ferengi, greed, as if material trade-offs can be ignored or hand-waved away.

Of course, omitting trade-offs entirely is deeply unsatisfying for an audience. There is no dramatic tension without the principal characters having to make hard choices. Hence, the Prime Directive is often more a weak suggestion than the foremost organizing principle of Starfleet. A drama without conflict isn't that dramatic. Come to think of it, that's probably why Darmok is so resonant, particularly with its explicit acknowledgement of the source material (the Epic of Gilgamesh is the source for both this episode and for the thematically identical Dennis Quaid vehicle Enemy Mine).

It was interesting to see how the different series (read: different writers) played with notions of exchange from S1 of ToS (1966) to the close of Enterprise in 2005 (I don't count the Abrams reboots in the same universe, mostly because they're straight action films rather than dolled-up social commentary, though that's its own meta-commentary, I reckon, eh?). ToS had interplanetary trade (Cyrano Jones, the trader responsible for the Trouble with Tribbles), though not always presented in the most flattering light. It really wasn't until the later seasons of TNG, a few offhand remarks in ST IV, and the portrayal of the Ferengi in DS9 that the writing staff unleashed what might be considered a truly venomous critique of selfish capitalism. Of course, please bear in mind that what ended up on the screen might be more aptly considered a jab at the studio (recall the 2007-08 writers' strike; these things seldom happen for no reason). Not to defend the series too strongly, but it was Voyager that really made an effort to introduce meaningful material scarcity back into the show. Of course, they might have handled it a little better (inter alia, ahem Jennifer Lien), but the theme fit pretty well with the mid-90s, when it was all parachute pants, optimism, and a bit of leftover giddiness from the End of Communism™.

The point of my rambling here is that fiction is a useful vehicle for seeing how the folks in their specific place and time (in this case, contemporary suburban Los Angeles, usually) interpret commerce in their musings. However, do please remember to bear in mind that these authors may often have axes to grind that have less to do with society at large and more to do with the contents of their cultural bubble. If you're skeptical of this claim, I urge you to apply your own cultural analysis to foreign television.

To choose is to incur cost. So say we all.

Rational (Beauty) Expectations

Rational Expectations (RE) on a Post-It Note is a behavioral conjecture: people aren't systematically fooled. Folks can make honest mistakes given available evidence, but if you collect the random errors and average them, you arrive at the underlying Platonic Truth.

Mind you, when economists use RE as an analytical tool, they're making claims about economic variables (usually future prices), but the idea should extend well to anything with sufficient salience. If it's important enough to worry about, it's important enough to think clearly about.

The following video is evidence against everyday RE.



Photoshop (or even its predecessors, airbrushing, soft focus, lighting tricks et al) is no secret. The Internet-old "I can tell from the pixels" meme is laughably tired. Of course we all know that advertisers attempt to trick the eye, so we should be able to seamlessly ignore or discount the false evidence presented in print ads.

Right? Hello? Is this thing on?

It's "there ain't no way to hide your lyin' eyes", not "there ain't no way to digitally manipulate your lyin' eyes." Advertisers should be able to make entirely credible disclaimers that their altered photographs do not constitute fraud, since 1) everyone knows about Photoshop and 2) no explicit claims of "use our products to look like this" appear in beauty ads. It's up to the viewer to make the connection.

Is Photoshop coercive?

More interestingly, how the heck can it work? Not in the "lighten and smooth the skin, lift the breasts, tuck the tummy" sense, but how in the heck can ordinary folks fall for its obvious duplicity? Are the social tuning forks in our heads so easily warped that we set standards based on bs images in glossy magazines?

It sounds absurd to me when I think about it, but maybe that's just because my appearance occupies a relatively small sliver of my attention (as those of you who know me in person can attest). Perhaps if I identified more closely with beauty, I'd be singing a different tune.

But it's still unlikely that the refrain would include censorious intent. I'd prefer to encourage folks to be better Bayesians.

Subjectivity and Pollution: Boob Tube

Recall if you will one of the classic debates on public goods provision: Minasian vs. Samuelson on television signals (with commentary by James Buchanan)*. Samuelson's argument rested on the non-excludability criterion (remember, this was 1964): there's no way to block non-payers from intercepting a signal and enjoying the fruits of what the National Broadcasting Company had to offer. It's a classic free-rider problem, solved (according to Samuelson) by public provision. Of course, as Buchanan noted, it wasn't an issue of public good provision, it was an issue of organization, of institutional choice: third-party (advertiser) payments proved up to the task of solving the economic calculus.

One thing that sort of puzzles me about the transformation of entertainment services is the old economic maxim that there are no solutions, only tradeoffs. Should I pay $15 a month for the original programming on Netflix or should suffer the insipid advertising on Hulu? In the case of a paid subscription, I bear the opportunity cost in no uncertain terms: I give up fifteen bucks' worth of consumption so I can watch Orange Is the New Black. Sure, that sawbuck and a half is ultimately subjective, given my personal valuation of the things I want, but that distribution of wants exists in my noggin and my noggin alone. It's completely internalized; I am the domain. To watch The Misfits on Hulu, I have to slog through commercials for products I don't really want to buy. There, I'm an element of a larger domain: the entire viewing public. The point of targeted advertising is to help solve these sorts of matching problems, after all.

Here's the thing, advertisers are caught in a competitive dilemma. Attention is scarce, so they plumb a deep pouch of behavioral and psychological tricks to capture those sweet eyeball juices. Ew. Anyway, by the time you're an adult, you're pretty likely to be inured to most of these tricks (which contributes to the severity of the dilemma). But even with all the regulations imposed on advertisers, it's probably still fair to say that unwanted advertising engages the same sentiments that drive people to knock it off with all the littering already.

Okay so advertising in public spaces is one thing. There's a big domain there: everyone who goes outside. For some folks (see the link above), billboards are in the same ballpark as street harassment. Is television advertising the same type of beast? As a head of household, it's up to me (not really, that's actually Mrs. Wilson) to perform the cost-benefit analysis for my family and it's possible that I could be using bad heuristics to judge the effects of advertising on my daughter. Should I be putting more weight on adverse effects when I make the initial decision to invite broadcasters into my home?

It's possible that within the relevant domain, advertising imposes quasi-external costs. I think most people understand this, so they're prone to imposing regulations within that domain. Do your homework before you watch TV, Billy. But suppose that heads of households systematically misjudge these costs. If they overestimate them, then television is underprovided to kids. If these costs are underestimated, then kids are watching too much TV.

Do you see the empirical difficulty? It takes a double shot of systematic failure both within households and across households to justify intervention, and even then, you'd still need to model the highly idiosyncratic benefits of television programming. Once that task has been surmounted, the next analytical task is the most commonly overlooked across the board: dynamic comparative institutional analysis. Responsible policy analysis shows why the policy prescription is durably superior to the alternatives. Pause for a moment and consider how often you see thoughtful comparative institutional analysis.

Is broadcast television euvoluntary? Think very carefully about cognitive bias, regulatory domain, innovation, and measurement challenges before you consider what your answer implies. It's probably not as easy as saying "we [sic] need to regulate commercials... for the children."





*Buchanan (1967). "Public Goods in Theory and Practice: A Note on the Minasian-Samuelson Discussion." Journal of Law and Economics 10; 193-197

Minasian, (1964). "Television Pricing and the Theory of Public Goods." Journal of Law and Economics 7; 71

Samuelson, (1964). "Public Goods and Subscription TV: Correction of the Record." Journal of Law and Economics 7; 81

EE Goes to the Movies Ep. 3: Star Trek IV: The Voyage Home

For those of you who don't remember, the fourth Star Trek film was the one where Kirk and crew saved the earth from a giant space probe that was trying to talk to whales by going back in time on a stolen Klingon Bird of Prey. Filmed on location in San Francisco and Monterey (while I lived there no less), it was that piece of cinematic virtuosity that generously granted the world the phrase "nuclear wessels."

One of the more memorable scenes involved Kirk and a newly-resurrected Spock riding the bus to the Cetacean Institute (proxied nicely by the Monterey Bay Aquarium, again, while I was living in the NPGS housing), in which... well, look for yourself.


Imagine this scene if Hikaru Sulu had been better at reading Klingon and had set the time coordinates for 2013 instead of 1986. They would have still gotten their whales, Montgomery Scott would have been able to use a voice-to-text program, and the "punk" on the bus would have had buds stuffed all up in his ear chasms.

The intervening 27 (oy!) years have rendered public transit more civil. More euvoluntary. If you're Leonard Nimoy, more craggy. At least part of the march of progress has been to tidy the place up, to reduce externalities (close your eyes and remember how bad the litter problem was in the 70s), to make it more comfortable for people to be polite.

The thing that continues to amaze me is that much of it is the result of individual action. The caricature econo-mystical "rational" actor would chuck a fast food bag out of a moving car so long as MC<MB. The private cost of littering (or of listening to terrible ersatz punk rock loudly on a city bus) is quite low, so long as there are no Vulcans in neck-pinching distance, so we should expect to see a lot of it. But actual folks are no more Max-U types than I am a Nile plover. Engineers work diligently on products that have the delightful side effect of injecting peace into our daily commute. Environmental conscientiousness tropes stay the hands of would-be litterbugs. Shame keeps errant nosepickers' fingers away from nostrils until a touch of surreptitiousness is available. The world is ever more euvoluntary.

And I think I'd like to take the opportunity to thank Shatner and Nimoy for their contribution. Who knows, without this scene, perhaps the guys at Apple might not have put quite so much thought into making the experience of enjoying music a bit less public.

Tapping the Creative Commons

It can be challenging to refrain from curmudgeonry when it seems like every time I switch on a Top 40 station and hear the latest pop drivel, it seems fueled by something I heard done better 20 years back.

My rough estimation for the formula to making a hit song in 2013:

1. Find a track that Rhys Fulber engineered somewhere in the Caustic Grip to Millennium era.
2. Strip it of any complex or meaningfully assonant elements.
3. Plop bland lyrics on top.
4. Autotune to taste.
5. Lather, rinse, repeat.

Importantly, it's not the ripping off that turns me into a discount Oscar The Grouch, it's the uninspired craftsmanship. Leeb and Fulber (& al) are nothing if not prolific and unapologetic samplers. They've lifted from a pretty wide swath of movies from the Alien franchise to Robocop 2 (seriously) to Hellraiser to the Michael Douglas tour de force Falling Down to that old chestnut The Atomic Cafe. And on Millennium, they lifted guitar riffs wholesale from mainstream metal acts. And I thank them profusely for that. 

"Immature poets imitate; mature poets steal"
-T.S. Eliot

I tend to agree with Tabarrok that there is an optimal level of intellectual property protection, and that it's possible that copyright statutes are on the dy/dx < 0 side of the hump.

My public choice discipline tells me that ex ante formal rules signed by legislatures will probably be penned by and in the best interests of established industries. This could be bad news for nascent firms looking to sail down that long road to the top (if they want to rock and/or roll). Contrariwise, ex post litigation is cumbersome and costly for the little guy, viz. the dust-up between The Honest Toddler and The Honest Company. It's tough peach pits to balance the Type I and Type II errors here. How much prior restraint is optimal? How much redress?

And is Eliot right? Is IP "theft" euvoluntary under the right conditions? If so, what are those conditions? Shakespeare's thievery would put Selina Kyle to shame. Do we see him as history's greatest villain? How is he different from Vanilla Ice (now there's a question I never thought I'd ask)? Is artistic cachet important? If so, how?

This sort of stuff is, I think, wrangling over conventional ownership and exchange. I'm not sure these questions are adequately settled in the realm of IP. We have decided to "coordinate" (I'm still not sure it's a symmetric game) on a set of formal rules, but without emerging from well-established informal rules, they seem awfully subject to change. Is there a better approach? Is that better approach in the core of the game?

No Animals Were Harmed in the Writing of this Post

I'd have to ask someone who lives in NC if this is a real story or not, but if it is, what do our EE conditions tell us about the transaction?

Conjugation with non-human animals is illegal, immoral, and gross. Publicizing the footage even more so, since it disseminates the grotesquery. But what about the marginal offense of selling the footage? Are those proceeds worse than committing the act, filming it, and publishing it?

Don't think too deeply on this though. I don't want to be responsible for conjuring too many unfortunate images.

Coercion by Shame: Page 3 Edition

So-called "soft" or (worse yet) "libertarian" paternalism parts ways from more traditional forms in that the relative price changes wrought by policy are meant to be a bit more mild. Under a standard regime, marijuana is bad and under no circumstances can you buy, sell, transport, produce, or possess it without the risk of running afoul of statutes backed by force. In contrast, the new paternalism would have you opt into the market for marijuana use, perhaps requiring licensure or some other surmountable barrier to entry, just enough to deter marginal users, but relaxing the barriers enough to erode profits that arise from legislated risk. The point of the new paternalism is that program managers can design suitable defaults to alter behavior that results in better outcomes, however that might be measured.

Public choice scholars are skeptical of the project.

And from across the pond, we find a particularly fine example of how a gentle nudge can easily become a rough shove. Parliament wants to make online pornography opt-in.

But how is this any different from default settings for organ donation or 401(k) participation you ask? Easy. It's the relative prices, man. The psychic cost of summoning the courage to submit a form with your name and address on it that states in no uncertain terms that you wish to view pornographic materials at your leisure in the comfort of your own home, and probably with the shades drawn is non-negligible.

It's premature to criticize the entire Thaler/Sunstein project just because the House of Commons pulled the legislative equivalent of a big brother punching a younger brother with his own hand saying, "stop hitting yourself; stop hitting yourself," but it is worth asking what happens when well-intentioned social planners armed with a brand-new fleet of default option controls fail to see the sort of change they envision. How easy is it to point to a putatively available option, surrounded though it might be by ravenous crocodiles and irate celebrity chefs?

"Sure, you're free to opt in, you just have to sign this waiver in the public square affirming that you have every deliberate intention of abusing yourself Biblically. Signed this Date of Our Lord 30 July Two Thousand and Thirteen under the witness of The Lord High Exchecquer."

Paternalist please. Metastasis is real. Pretending otherwise insults the intelligence of even the very stupid.

Of Hume and Bugs Bunny

If Hume is to be believed, the states of antiquity would hoard treasure to be spent in times of war. By the time he penned Of Public Credit, Wm. of Orange had long ascended the throne and debt financing of state-led aggression was well-established. It is in this post-Glorious Revolution environment that he wrote:

There are also, we may observe, in ENGLAND and in all states, which have both commerce and public debts, a set of men, who are half merchants, half stock-holders, and may be supposed willing to trade for small profits; because commerce is not their principal or sole support, and their revenues in the funds are a sure resource for themselves and their families. Were there no funds, great merchants would have no expedient for realizing or securing any part of their profit, but by making purchases of land; and land has many disadvantages in comparison of funds. Requiring more care and inspection, it divides the time and attention of the merchant; upon any tempting offer or extraordinary accident in trade, it is not so easily converted into money; and as it attracts too much, both by the many natural pleasures it affords, and the authority it gives, it soon converts the citizen into the country gentleman. More men, therefore, with large stocks and incomes, may naturally be supposed to continue in trade, where there are public debts; and this, it must be owned, is of some advantage to commerce, by diminishing its profits, promoting circulation, and encouraging industry.

If you recognize the theme here, it's a proto-MMT argument, that liquidity is important. Debt financing supports commerce. In our terms here, it features positive externalities. It's good.

But much like Hume anticipated Keynes and Sumner, so too he anticipated Bastiat and Hayek.

But, in opposition to these two favourable circumstances, perhaps of no very great importance, weigh the many disadvantages which attend our public debts, in the whole interior œconomy of the state: You will find no comparison between the ill and the good which result from them.

He then goes on to list five shortcomings of debt financing, including: redistribution from the modest to the elite, an early version of Gresham's Law, oppressive ex post taxation, obeisance to foreign bondholders, and an argument ad segnitium (that bondholders will live an indolent life and produce little).

ATSRTWT

The rest of the essay is set to mockery of public credit and those who enjoin to live lives of culpable comfort on the rents claimed by the excise of taxes. He warns of the perils of sovereign default and contrasts nicely the bankruptcies of the crown with the private landowner.

So what does this have to do with B. Bunny? With euvoluntary exchange?

During the big, early-20th century wars, ordinary folks would go see shorts like the one above before their feature films and know that Johnny who had gone off to fight Hitler or Tojo would have a few extra bullets in the chambers of their M1 Garands or a fresh set of tracks draping their (notably crappy) M4 Shermans. Euvoluntary. Sure, there might be a fungibilty filter as the purchase twists its way through the general fund on its way to the Pentagon, but folks pretty much knew what they were getting with the ossification of their savings: an increased probability of battlefield victory.

How about debt financing in peacetime? When you snag a T-bill these days, what are you buying? Liquidity? Funding for regulatory agencies? Stimulus? Do you even know? How would the post-Space Jam Bugs sell QE? I guess part of the point of the apparatus of modern banking is that he doesn't have to.

I wonder if anyone else has ever attempted to link Mel Blanc and David Hume. Hm.

Pit from Payola

Way back when lil' Mungo was still in diapers, that most munificent body the US Congress held a series of investigations spearheaded by the House Subcommittee on Legislative Oversight into the grievous immorality of "payola", an investigation that nearly derailed the career of the Dickensian vampire most of us know as Dick Clark.

To make sense of this investigation, it helps to know what "payola" is and why it works. Put simply, it's a direct payment from an artist (or an agent thereof, usually) to someone (a radio DJ with a large audience) in exchange for playing their record. That's it. That's what prompted the "greatest deliberative body in the world" to drop its socks and grab its subpoenas. Trading money for airplay.

Now, the Public Choice of this is trivially obvious. Incumbent music industry elites had rents to preserve and this upstart rock and/or roll music threatened these rents. What dost thou when thine rents are besieged? Hie thee to Parliament and beg thy Lord exchequer for relief of course. But this dog won't bark without at least some appeal to popular moral sentiment, says I. The median voter theorem for all its flaws still has teeth in its head. Congress can't just up and flaunt the will of the people and not expect a modicum of comeuppance.

So what misery lurks in payola? Two things I think. Both are predicated on an asymmetry of attention. DJs are specialists in their field. They do the hard, unpleasant work of screening the kelp-festooned, brine-shrimp-encrusted seawater that is musical artistry before it floods your burning ear holes. They have sort of a BATNA disparity, only it's a disparity of knowledge rather than money or political power. Think of it as a drop D tune down of the BATNA disparity enjoyed by university professors: mere specialization gives them dissemination power over the worldview of their audience. The simple act of selecting what material to present gives an edge to which ideas thrive, which wax platters folks think of picking up.

And that points to the other EE violation: uncompensated externalities. The ultimate scarce resource is attention. A catchy earworm consumes a large part of your attention. Don't believe me? You are now silently humming Dexy's Midnight Runner's classic hit "Come on Eileen" and you will be all day unless I let you off the hook. Too-ra-loo-rai-ay.

I think there's something to the claim that DJs are partly reflectors and partly creators of the affections of the audience. They make their bread and butter by catering, which includes giving folks what they want, but also giving them what they didn't know they wanted. And much like the hidden menu at In-N-Out Burger, people may not know what they want until someone shows them. That person is a kingmaker for Animal Style fries.

So, we've got well-entrenched record executives protecting old rents against upstarts and Congress justifying an inquiry into the matter on curious moral grounds. See, someone still has to make programming decisions, and I guess everything else is still under consideration, like retaining a fickle audience and yet more fickle advertisers, but cash payments are out. You can give it away, but you can't sell it. Sex, drugs, and rock-n-roll. How about that.

Okay, okay. Here. I'm not a monster.



Now the only thing you've got left rattling around in your head is an image of a baby Munger crawling around  a Florida bungalow, an oversized safety pin securing a cloth diaper. You're welcome.

Hume and the Art of Motorcycle Maintenance

For those of you who haven't read the 1974 Robert Pirsig classic Zen and the Art of Motorcycle Maintenance, do yourself a favor and pick up a copy. It's a quick, breezy primer into an often felt, but seldom articulated gulf between art and artifice.

But he didn't get there first, not by a stretch. David Hume, Essay XV:

Even in those productions, commonly denominated works of art, we find that the noblest of the kind are beholden for their chief beauty to the force and happy influence of nature. To the native enthusiasm of the poets, we owe whatever is admirable in their productions. The greatest genius, where nature at any time fails him, (for she is not equal) throws aside the lyre, and hopes not, from the rules of art, to reach that divine harmony, which must proceed from her inspiration alone. How poor are these songs, where a happy flow of fancy has not furnished materials for art to embellish and refine!

But of all the fruitless attempts of art, no one is so ridiculous, as that which the severe philosophers have undertaken, the producing of an artificial happiness [emphasis in original], and making us be pleased by rules of reason, and by reflection.

Art: the product of happy nature, a graceful dalliance with a winsome muse and the reflection of a sensitive scribe.

Artifice: the pretense to, "regulate, refine, or invigorate any of those springs or principles, which nature has implanted in me."

'Tis the cold heart of a clod what never has known the tug of authenticity. You don't need an artist's soul to appreciate a fiery sunset or the geometry of a snowflake or the dazzling athleticism of an NBA final match. No painters beret need ye don to lose yourself in an elegant snippet of C# code or engross yourself in the majesty of the stars or unmoor your imagination to swim in the oceans between sweeps of ink that bind a narrative together. Everyone knows art, yet it's often that we consume artifice. We buy bottled sugarwater, see blockbuster films, and God forbid, drive a Toyota.

And what of the ticky-tacky attempts to bridge that gulf? What of the saccharine platitudes that urge us to buy "fair trade" coffee and intentionally smash teacups so that we can mend them for the elusive wabi-sabi aesthetic? Do the way we rank these things in our quiet inner places match how we rank them in an objective marketplace? Should they be ranked alongside each other? Or is it a distinction made irrelevant by individual calculus? Do I have any right to be offended by either epicureans or ascetics? By elitist snobs or dreadful boors? Is it not enough that I have access to my own euvoluntary exchanges that I have to get wound up by those of others?

What are the bounds of uncompensated externalities? Does the bad taste of others count?

Finding the Marble in the Oatmeal

Talking with Robin Hanson is a little like drinking from a fire hose. In my latest doorside chat, we discussed the role of books. Specifically, we discussed the role they would occupy in the future. Clearly, with the rise of cheap computing, the very large share of information won't be printed on pulped wood much longer. What purpose then books a score years hence? Two generations? A millennium?

Me being me, I pumped these thoughts into the hydrant of euvoluntary exchange. It strikes me that the decline of the bound volume bears only superficial similarities to other defunct technologies. The printed word, if you'll forgive a modicum of poetic earwax, permits communion with ancestors distant in ticks of the calendar and turns of the cartwheel. Books bend our mind's eye to the lyrics of ages long gone across hill and sea, through darkest jungle, into the beating heart of civilizations now in ash and dust, lending fleeting glimpses of hearts and minds long laid to their eternal rest. The buggy whip, the sextant, the flint axe and the oil lamp might occupy places of fondness in the cockles, but none of the day-to-day items that have fallen out of use boast the same civilization-forwarding characteristics as the printed volume.

Tomorrow's information abundance permits the reader, should she choose, to guzzle as much unfiltered knowledge as can fit through the hose-et-nozzle of her attention as she can handle, perhaps much much more. Quaint tomes harboring musky odors will sit unread on shelves as identity emblems signaling conformity with the rough grain of history. Knowledge is a super-euvoluntary commodity: without it, humanity snuffles the forest floor for edible roots, picking lice and constructing crude toys from the bones and feces of slain animals. Without the lights of generations past, there is no holly jolly Christmas.

The book is the earthly vessel of this intergenerational super-euvoluntary exchange. It has laid claim to totemic reverence in Western Civilization since before even the first movable type. Libraries are temples, are they not? Home libraries are shrines. People are unlikely to abandon their shrines, even if they are filled with trashy Harlequin Romances and 101 Tasteless Knock Knock Jokes anthologies. Their purpose is to spray their owner's guests with the essence of her intellectual and cultural identity. Unless a suitable substitute comes along, folks--ordinary folks--probably won't be queuing up to abandon this.

People who build steam locomotives in the backyard or raise horses have hobbies. People who will continue to collect books long after their instrumental use has waned are cultured. Maybe this is an important distinction, maybe not. Either way, I can't imagine the stock of books changing all that much over the next century, even if the flow dries up considerably.

 Reference:

A Man of Wealth and Taste

Are sales of souls euvoluntary? Before you think I'm asking a silly, facetious question, consider that animistic religions are alive and well in many of the poorest regions of the world. Europeans and their kith have long strove to quell the native religions, be it by bell, book and candle, by the sword, or by the slaver's net. Behind the entire sordid history of the intersection of Rome and the rest of the world is the Faustian trope.

Poor kid, hard on his luck, but with ambition and talent trades his immortal soul for a chance to grab the brass ring. Maybe it's playing a mean trumpet, maybe it's batting .400, maybe it's EGOT, maybe it's bulls-eyeing womp rats in your T-16 back home. Whatever the prize, there's a deal struck at midnight at a crossroads, perhaps in the presence of a dead cat in a burlap sack. The contract is occasionally voidable (See, eg. Treehouse of Horror IV), but typically ends with Italian poets paying you a visit under the watchful care of the author of The Aeneid.

Angus on the "Human Zoo"

Angus notes that packaged "culture" in less developed countries ("Let's go see the monkeys, and the lions, and then the humans dressed in colorful costumes!") is demeaning.

Interesting problem. Actually three problems.

1. Yes, it's likely demeaning to perform (possibly fake) native dances for leering white people.
2. Yes, those folks likely do need the money. They would be even worse off if they did not have this opportunity.
3. Yes, Angus does that right to say, "I don't enjoy this!" and go do something else.

The problem is that the BATNA of the "native dancers" is so abject, so destitute, that it seems exploitative. Is it?

I would add one thing: consider this "aboriginal dance," in Oz. Just who is laughing at whom? This is VERY uncomfortable, and I would have left this "performance." But it is by no means clear that the performers are not mocking the audience.