Hi. EconPhD student in Philadelphia. Found OB through Marginal Revolution a couple years ago.
feanor1600
Karma: 170
This is the evil corollary of the Efficient Markets Hypothesis (that all publicly available information is instantly incorporated into market prices).
It sounds like you rediscovered the “Core”.
The independence of irrelevant alternatives (“pairwise independence”) can also apply to individuals, it is just that Arrow’s theorem doesn’t directly require it. However, a better statement of the independence of irrelevant alternatives for Arrow is “if all individuals have preferences satisfying pairwise independence, then the group’s decision function should also satisfy it”. So for group IIA to matter we should have individual IIA
It says that if the voters make the same decisions once the alternative is added, then the voting algorithm does. See Arrow’s definition of IIA on page 27 of the 2nd edition of Social Choice and Individual Values (you can find this part for free on Amazon).
“There are numerous law of economics which appear to fall into this category; however, so far as I can tell, few of them have been mathematically formalized.”
For better or worse, just about everything in economics has been mathematically formalized. If you are wondering about a specific “law” or concept I can try to dig up examples.
“And this essay does remind me a lot of Paul’s letter to Galatians—in an entirely good way!” I second this.
“Sherlock Holmes once said that once you have eliminated the impossible, whatever remains, however improbable, must be the answer. I, however, do not like to eliminate the impossible. The impossible often has a kind of integrity to it that the merely improbable lacks.” —Douglas Adams’s Dirk Gently, Holistic Detective
Academics may be relevant as a similar “thinking community”. I’ve heard many academics say they are severe procrastinators. Possible reasons for this are: 1) Procrastinators are attracted to the job, its independence and long-term deadlines 2) The nature of the work makes people procrastinate; research is hard, plus no boss and long-term deadlines mean immediate punishment for procrastination is rare 3) The job makes people feel they have akrasia even when they don’t, perhaps because colleagues and competitors seem smarter and harder-working than in other fields
If nothing else, reading LW makes me feel 3)
As an economics graduate student trying to decide between academia, think tanks, government, and the private sector, I would appreciate it if you could expand on this. In particular, I wonder which jobs have the most novelty (not always teaching the same class or working with the same data), which encourage you to do more/better work, and which have the highest quality colleagues (rated on intelligence or friendliness).
I am, I’ve been hoping someone else would do the organizing.
I assumed when taking the survey that those running the simulation are outside our universe and so ontologically basic.
Awesome! I’m in center city and so would prefer to meet there, but it looks like this coffeeshop is right next to a train station so that works.
FYI, the marker on the google map is pointing to the wrong place, even though the address is correct (and works when I type it into google maps myself). La Colombe is just to the southwest of city hall, and looks out at it.
Without addressing the substance of the papers, I can say that in practice most health economists still think the RAND experiment is really important. Robin Hanson is not unusual in this regard, the RAND experiment was featured prominently in the 2 graduate health econ classes I have taken, and in recent textbooks and papers.
I would stay away from the accept/reject terminology and simply say they should assign low probability to this theory due to Occam’s razor, and increase the probability if it survives experimental tests.
On the politics question about libertarianism, “distribution” should read “redistribution”. Also, ideally the political questions would ask about regulation and/or spending rather than taxes.
I study/teach economics for a living, this made my try to think about why it is useful (besides that it gives me a job).
How To Run A Government
Economics has a lot to say about which government policies will make people better off or worse off. This is a big reason I got interested in economics, but its not very practical for the vast majority of people, who have essentially no influence over government policy (and in fact it is economists who are famous for arguing, perhaps incorrectly, that votes don’t matter).
Understand How The World Works
It’s always nice to just understand more, but in particular I think some insights are likely to make you happier. For instance, you may worry about not being a good person because you are selfish, but economics argues that in market settings being selfish often helps others too. Several insights of economics make you appreciate other people more: knowing that their specialization and labor is what makes the world, and you, so rich- people of different countries, religions, et cetera cooperate to make everything from your computer to your pencil. Whenever I get annoyed at the crowd in a coffeeshop or on the subway, economics reminds me that if it weren’t for the other customers, there would be no coffeeshop or subway. Learning about subjective value helps you not to look down on others so much for “bad taste” in music, books, et c.
Practical Skills
Econometrics (basically our word for data analysis) is the main practical skill of economics. It is a great tool for figuring out how the world works. I use it for academic research, but many private sector realize the value of econometrics (though they may call it analytics or data science or forecasting or something else). Another skill that only a few economists really master is mechanism design, which has been used to sell ads and spectrum and allocate kidneys, students, and medical residents.
Save Money
A lot of people get the idea that economics is about “how to make money”, but anyone seeing my paychecks would realize I’m not the one to teach that. We do have some things to say about how not to throw money away though. By learning about the Efficient Markets Hypothesis and investing in broad index funds, you will avoid losing money to fund managers fees and brokerage trading costs, and avoid the possible catastrophic failure of an undiversified portfolio. Sometimes you can use efficient markets to save time as well. If I want to know whether the recent jobs numbers were better than expected, I could read a lot about it, or just look at how the stock market reacted in the 15 minutes afterward. If I want to know who is going to win the US presidential election, I could follow the news for hours and hours and make a guess, or just look on Intrade for one minute.
Act Rationally
Economics teaches a model of how “rational people” act. This helps you notice when you are departing from the model of rationality and think about doing things differently. For instance, write off sunk costs and make decisions at the margin.
All in all, I’m not sure if economics is the most useful subject to learn (what are other contenders?), but it does seem to have a fair amount of practical utility.
“There are all sorts of benevolent aspects of everyday life which are clearly the product of chemistry or engineering or medical science, but it’s hard to assemble a collection of concrete, object-level stuff and say “all these things were made by economists!”′
There is a book, “Better Living Through Economics”, (the title inspired, I assume, by “Better Living Through Chemistry”) that explains some of this. It is largely stories about economists getting the government to work better- ending the draft, stabilizing prices, et cetera.
I do solemnly swear by the great Wiki that from now until April 1st, I will finish every part of every homework assignment by the midnight before it is due, on pain of food deprivation until the work be complete.