Friday, May 23, 2008

Are Humans Unique?

According to an article in the latest issue of NewScientist, we humans are not special as we used to believe since we now know better. We are not the only species that feels emotions, empathises with others or abides by a moral code. Neither are we the only ones with personalities, cultures and the ability to design and use tools. Yet we have steadfastly clung to the notion that one attribute, at least, makes us unique: we alone have the capacity for language.

Some recent research has revealed that six seemingly "uniquely" human traits are already found in animals (here), and that animals can even "possess" some human abilities (here).

Bless Sichuan, Bless My Hometown

The 5.12 earthquake has already killed more than 60,000 people in Sichuan province. Being very close to the epicenter, my hometown city, Mianzhu, is severely damaged. More than 10,000 civilians lost their lives in this devastating earthquake. One of my aunts, a beloved wife and mother, also died in the disaster. To me, she was always kind, generous and supportive. May she rest in peace in a rainbow heaven!

May God bless everyone in Sichuan!

Sunday, May 4, 2008

The Mystery of Monogamy

Three economics professors from Hebrew University published an interesting paper on the American Economic Review, examining why developed societies are monogamous while rich men throughout history have typically practiced polygyny.

Wealth inequality naturally produces multiple wives for rich men in a standard model of the marriage market. However, we demonstrate that higher female inequality in the marriage market reduces polygyny. Moreover, we show that female inequality increases in the process of development as women are valued more for the quality of their children than for the quantity. Consequently, male inequality generates inequality in the number of wives per man in traditional societies, but manifests itself as inequality in the quality of wives in developed societies.

As summarized by Mahalanobis, the main empirical prediction is that the composition of inequality, not just the level, is an important determinant of the degree of polygyny in society. Specifically, societies should be more polygynous in countries where variation in overall wealth inequality is determined more by differences in nonlaber income (capital and inherited wealth) versus income variation generated by differences in the levels and returns to human capital investments.

Worth a read.

The Intellectual Portrait Series

...from The Online Library of Liberty.

This Intellectual Portrait Series features several interviews with some of the most notable economists and leading classical liberal figures of our time, including Milton Friedman, James Buchanan (part I, II), Ronald Coase, Armen Alchian and Gary Becker. This series also has an one hour summary of the life and thought of Friedrich A. Hayek.

Happy Birthday... my Econ-Biz Blog! Cheers!

Learning by blogging does make a large difference!

Friday, May 2, 2008

Economics makes you selfish??

As Ray Fisman puts forward on Forbes: We are what we learn.

"Exposed to these (Milton Friedman and Ayn Rand's) compelling intellectual frameworks, which emphasize market efficiency and model human behavior as driven primarily by rational self-interest, do students become more selfish?

It is not easy to measure the effect of indoctrination (or, more euphemistically, "learning"). Students don't randomly decide to study, for example, economics rather than French literature. Perhaps the econ majors were efficiency fanatics to begin with.

Except, it turns out, at Yale Law School. All students are required to take courses in contracts and in torts, and they're randomly assigned to an instructor for each class. Some of these teachers have Ph.D.s in economics, some in philosophy and other humanities, and some have no strong disciplinary allegiances at all. Professors are encouraged to design their courses as they see fit. Instructors from economics may emphasize the role of contracts in making possible the efficiency gains of the marketplace, while philosophers may emphasize equal outcomes for contracting parties. So economists teach about efficiency and philosophers teach about equality.

To figure out whether this affected their young charges, we put 70 Yale Law students in a computer lab, and had them play a game that would reveal to us their views on fairness...It turns out that exposure to economics makes a big difference in how students split the pie, in terms of both efficiency and outright selfishness. Students assigned to classes taught by economists were more likely to give a lot when it was cheap to do so. But they were also much more likely to take the whole pie for themselves.

These findings hint at the influence that powerful ideas may have in shaping how we see the world, even late in life. It's also a sobering message for teachers such as myself. The students in my classroom will venture forth into the world of business and management, carrying with them some of the viewpoints and attitudes that I choose to emphasize in my lectures. Students learn much more than the facts; what we choose to communicate to them is a responsibility not to be taken lightly."

Hat tip to Mankiw.