Curt Doolittle

Theme: Incentives

  • How Much More Capitalist Is The Us Than Germany?

    • Capitalism: the voluntary organization of consumer production.  (Liberty)
    • Socialism: the involuntary organization of consumer production. (Totalitarianism)
    • Mixed Economy: the voluntary organization of consumer production, and the involuntary redistribution of the rewards earned by organizing consumer production. (A trade-off between liberty and totalitarianism).

    Socialism is impossible, since neither the incentives to produce, nor the means of economic calculation are possible.  The only possible means of organizing production that produces surpluses is to provide both individual incentives and the means of rational calculation for pursuing those incentives.

    This means that the only possible means of organizing production that is adaptive to changes in the world (wants and scarcities) is capitalism.  This is why the entire world has adopted capitalism (the voluntary organization of consumer production). 

    However, the entire world has also adopted mixed economy consumer capitalism: that is, the authoritarian regulation and taking of the rewards from the voluntary organization of production, for the purpose of redistribution (By licit or illicit means, for licit or illicit purposes.)

    So the entire world practices capitalism and none of the world practices socialism. Instead, the whole world practices mixed economy capitalism by taking the maximum amount that they can extract from the organizers of production without disrupting the organization of production. 

    Now, the difference between the USA and Germany is such:
    1) germans are less diverse (more homogeneous) and homogeneous societies (see scandinavia) are comfortable with redistribution (sacrifice of my family and children and subsequent generations) for the service of yours. However, diverse polities are not comfortable with sacrificing for their competitors, any more than germans are happy redistributing to Turks, or mediterranean cultures that are lazier and more corrupt.  America by contrast has an old historical problem of diversity of many peoples, and self reliance.   The more diverse a people the less tolerance for redistribution.

    2) America is not comparable to Germany per se, but to Europe in total. There are 50 American states, and no less than 9 or 10 american regional cultures, and just as brussels is  perceived as a dictatorship the american government is perceived as a dictatorship by the central and southern peoples of the american continent, that works for the advantage of the high population centers of immigrants on the coastal areas.

    As such Germany is both more homogenous, smaller, and more likely to redistribute, (over the objections of the south), while America is larger, more diverse, and less willing to redistribute.  The reason is that germans are not competitors for power with one another (mostly) but american regions are at war with one another using the government as a proxy.

    For these reasons Germany is less an advocate of a mixed economy than say California or New York, but more so than say Iowa, Georgia and Alaska.

    Cheers

    https://www.quora.com/How-much-more-capitalist-is-the-US-than-Germany

  • EDUCATION: CUNNING VS MORAL The Perverse Incentives of the Academy. –“education

    EDUCATION: CUNNING VS MORAL

    The Perverse Incentives of the Academy.

    –“education makes one cunning, not wise, and not moral”–

    I was kind of ‘moved’ by Michael Philip’s post today on the motives of members of the academy. It’s been bothering me all day because not only is it true, but I think it qualifies as a bias, and a formal bias at that. Or rather, I think status-biases are probably a category of cognitive bias that I (we) should investigate, document, expand upon, and communicate with some frequency. Because most of the progressive status signals are constructed of cognitive biases (falsehoods).

    Cunning favors complexity. Dishonesty favors complexity. Speaking truthfully is in fact laborious – it requires a lot of effort. Speaking the truth however, is a very simple strategy, that requires very little cunning – maybe none at all. Because prohibiting the imposition of costs is a very simple rule. Voluntary exchange is a very simple rule. The rule of law under Propertarian Property Rights (Property-in-toto), is a very simple rule. That demand for the state will increase if their is a lag in the development of property rights, is a very simple rule. These are all very simple rules.

    If all moral propositions are decidable, (under propertarian logic, they are), then there is no room for cunning, except to lie. I fact, cunning is a contrary indicator of truth, and of morality.

    Yet cunning is such an attractive means of dominance display. For those of us trying to eliminate cunning, we can temporarily display dominance, but only in the art of refuting loading, framing, overloading and suggestion. And since I have no illusions that the incentives to construct complex lies via cunning verbalisms will ever disappear, then I suspect that the defense against cunning will always require wisdom and cunning.

    So I have a new to-do, which is to enumerate the cognitive biases we fall victim to in the pursuit of status signals.

    Source date (UTC): 2014-10-20 19:25:00 UTC

  • SHOULD THE GOVERNMENT INTERVENE AND MAKE ME A FORTUNE 500 CEO? Feminists are abs

    SHOULD THE GOVERNMENT INTERVENE AND MAKE ME A FORTUNE 500 CEO?

    Feminists are absurd. Now, here is the data. CEO’s of large companies are (a) really smart, and (b) tall. Now, there is a correlation between height and brain size which correlates with intelligence. But also, the very primitive power that superior height conveys is tangible, and measurable.

    Does that mean that the government should redistribute CEO positions from tall people to short people?

    Then why should we redistribute CEO positions (or any position in society) from socially superior people to socially inferior people?

    I have no problem with the fact that I can never play basketball well, and that in both soccer and volleyball I am working at a disadvantage. I have no problem that in business I am working at a disadvantage. I have no problem that even in the pursuit of desirable women that I am at a disadvantage. These are disadvantages. But I cannot comprehend wanting others to sacrifice the maximum that they can achieve in life to compensate for my disadvantage.

    Yet feminists will argue the opposite day in and day out. The fact is that women work fewer hours, are less willing to make economic sacrifices, less willing to take economic risks, are less loyal to internal political networks, and are vastly outnumbered at both the top and bottom of the intelligence and aggressive impulsivity scales.

    Just as I cannot possibly sense but 1/100’th of what an average women can about any other human being she encounters in the first fifteen seconds, I understand that nearly all women on earth, cannot make political assessments in the same short time frame.

    We are compatible. But we are not equal. And group competition requires we make the best use of our best, because everyone else is merely a commodity.

    Source date (UTC): 2014-10-20 05:13:00 UTC

  • Clean. Seating. Service. Food. Selection. In that order.– If you want your cafe

    –Clean. Seating. Service. Food. Selection. In that order.–

    If you want your cafe to look busy, buy cushioned chairs with arms. If you want to reduce time a bit, then buy cushioned chairs without arms. If you want to turn tables buy un-cushioned chairs. If your clientele is shit, then buy used and disposable in cushioned chairs without arms.

    Never ceases to amaze me that restaurant owners and cafe owners forget that it’s not food that they are selling.

    I should do a photo survey of Lviv and I bet that the distribution is really tight.

    Clean. Seating. Service. Food. Selection. In that order.

    Source date (UTC): 2014-10-13 07:41:00 UTC

  • PROPERTARIAN INCENTIVES FOR THE POLICE

    PROPERTARIAN INCENTIVES FOR THE POLICE

    Source date (UTC): 2014-10-13 06:23:00 UTC

  • FOR THE POST-LABOR ERA Thoughts. 1) We use the word ‘abstractions’ and ‘calculat

    http://www.careeroverdrive.com/blog/the-accelerating-assault-to-digitize-automate-mechanize-robotize-you-out-of-a-job-podcast-textHOPE FOR THE POST-LABOR ERA

    Thoughts.

    1) We use the word ‘abstractions’ and ‘calculations’ but a better term is ‘ model ‘. (A subject I’m currently working on). Most people learn by imitation (observation and repetition). And some by imagining actions. Some by abstractions of actions. Some by models of universes. Some by inventing models of universes. And the problem is that the ability to construct models of any type requires a right shift in intelligence distribution of a standard deviation.

    2) I think I have a ‘socio-economic’ solution to this problem, because while it is true that fewer people will engage in the production of market goods and services, the same nearly universal set of people will still be required to engage in the production of the market itself: the voluntary organization of production and consumption. And furthermore, that we can increasingly pay people to produce commons. And it is commons that will bring about the star trek cities and landscape we imagine in the future – not consumption.

    3) I could imagine requiring all physical structures for example, be built from hand-materials – that require labor. I could equally imagine regulating machines out of human-possible jobs.

    4) I could imagine MMT and heavy redistribution, where ‘working’ was a preference for above-standard-redistribution amounts, and therefore status, and luxury goods. Work was a vehicle for status rather than existence. And furthermore that child-bearing decreased your redistributed income.

    5) One thing I often think about is how an oligarchy of producers (like the greeks were) and a vast non-producing proletariat might follow their existing incentives. Meaning, why wouldn’t society return to feudalism of the productive, rather than a feudalism of the people who construct property rights necessary for production (warrior land-holders)? Because those are the incentives that I see.

    These are the models that I work with. So there is a bit of hope here that a socio-political solution will not only be possible but a beneficial adaptation. The fundamental problem is in preserving the incentives to conduct a voluntary organization of production (capitalism). However, under capitalism we falsely assume that the work necessary to create a voluntary organization of production (property rights) by every individual in society is not in itself an act of production that exposes individuals to high costs (it is).

    So individuals engage in production of the commons we call the market, even if they do not engage in production of particulars (goods and services). If you do not advocate for an involuntary structure of production (socialism), and you engage in production of the commons (property rights and therefore the market) and you pay for your shareholdership by doings so, then it is hard to see that it is not a violation of your rights to compensate you for your production of the commons (the market) by producing, respecting and policing property rights.

    This further preserves liberty because it allows for the institutional illegalization of socialism (the involuntary organization of production, in which individuals do not act to produce the commons of the voluntary organization of production.)

    Source date (UTC): 2014-10-13 04:26:00 UTC

  • PROPERTARIAN REASONING ON TOO BIG TO FAIL I won’t go into it here because it’s l

    PROPERTARIAN REASONING ON TOO BIG TO FAIL

    I won’t go into it here because it’s late, I am tired and it’s loud here. But if I follow Propertarian reasoning, then no bank is insulated from too big to fail without warranty of every individual committing to a price.

    The only way to create large banks immune to perverse incentives and dependence upon impossible calculations, is to professionalize banking, require insurance, and eliminate all immunity.

    This would dramatically increase the number and quality of bankers and flatten the income distribution in federations of banks.

    More details are required to grok this if you are knowledgable about banking (finance).

    But my point is that you cannot fix too big to fail any other way.

    Source date (UTC): 2014-10-11 16:11:00 UTC

  • MODELS ARE FOR SMART PEOPLE –“I’ve been telling EconLog readers about my articl

    MODELS ARE FOR SMART PEOPLE

    –“I’ve been telling EconLog readers about my article with Steve Miller on intelligence and economic beliefs for years. Now our piece has finally been published in Intelligence. Quick version of the paper:”–

    —-

    Adding a measure of intelligence to the list of independent variables and re-estimating confirms that ability bias is present and substantial. Adding intelligence as an independent variable does not simply shrink our estimates of the effect of education. It is more important than education in both statistical and economic terms. In fact, intelligence turns out to be the single strongest predictor of economic beliefs.

    First, even though intelligence is the most important overall predictor of economic beliefs, it is not the most important predictor of beliefs in any of the four categories. Party, ideology, and male gender are stronger predictors for the anti-market questions. Education and “other race” are stronger predictors for the anti-foreign questions. Black is a stronger predictor of the make-work questions. Income growth is a stronger predictor for the pessimistic questions. Intelligence is the most important overall predictor of economic beliefs because it has a strong effect in all four categories, not because it has an overwhelming effect in any particular category.

    Second, intelligence is more important than education for every category except anti-foreign bias. For anti-market and make-work bias, intelligence is much more important than education; for pessimistic bias, intelligence has a moderate edge. Education is, however, the most important predictor of anti-foreign bias. This is consistent with the literature finding that education “tends to socialize students to have more tolerant, pro-outsider views of the world” (Hainmueller & Hiscox, 2006, p. 473). In contrast, the typical educational experience gives students mixed signals about anti-market, make-work, and pessimistic biases. Classes in economics and high-IQ peers restrain these biases, but classes in other social sciences and humanities, as well as student activism, arguably encourage them.

    —–

    Source date (UTC): 2014-10-11 11:44:00 UTC

  • CURIOUS: CULTURAL OBSERVATIONS As a CEO my style is very American: meaning liber

    CURIOUS: CULTURAL OBSERVATIONS

    As a CEO my style is very American: meaning libertarian in management: I try to create as much of a bottom-up organization as possible with as little management as possible, and to attract the best talent possible, because the best talent wants to demonstrate creative expression – in a country where creative expression is a competitive value.

    The general thinking in the states is that employees know customers the best and so we need to empower them to serve customers. We get profits from helping them serve customers. The more we help them the more profits we make. The increase in credit capacity and the petro dollar has not been good for us in this respect, because it has given consumers a lot of free money to inflate the economy while reducing our discipline. In Europe consumers are much ‘poorer’ by every possible measure and so companies must fight for their attention. Conversely, people are much more patient with companies and regulations and rules than americans would be. So the culture tolerates the business climate and visa versa.

    But where this shows up is lack of rotation in Europe, and less radical innovation, while we get better engineering out of germans (again, who I think ‘do it right’) in education at least – if not in an oppressiveness that is beyond my comfort. And without the humor that my anglo peers survive on. 🙂

    I wonder how Oversing will play in european countries? Will europeans be able to handle(tolerate) that much transparency? That much honesty? That much measurement? That much social rather than hierarchical feedback? That much customer service? Or will just young competitors make use of such a product? Or will more hierarchical companies turn off the transparency and use it as command and control? Young people get it. Technology people worldwide seem to get it. Ukrainian’s get it. Russians get it. South American’s get it.

    Hmmm…. What else….

    In the states we try to push independent thinking farther down the chain than is possible. And we don’t train the bottom to be capable. We pretend everyone can become a member of the middle (or upper middle) class and fail the majority by doing so. (we have the world’s most absurd education system in that regard. for the upper half it’s awesome. but for the lower half its a tragedy.)

    Germany does it about right. They focus on making the lower half excellent and so the upper half has better assets to work with that way. And it shows. Maybe Finland does it better. But they have a more homogenous society to work with so they can create a better universal educational system. But Finn’s are too timid in business. Germans are the most honest after americans. I notice that it’s actually easier to deal with germans than other americans and I have to stop myself from couching everything inoffensively when talking.

    I don’t really understand the UK system. And I have had very bad experiences there. So maybe I’m biased. People turn out more literate. The middle turns out pretty well and the top excellent. But the bottom is… not as bad as the states in incompetence, but worse than the states in rent seeking behavior. Our bottom end can’t find work but they don’t try to avoid it. I don’t understand the class in the UK that seeks to avoid labor at all costs, and do the minimum whenever possible. It could be that class exists all over Europe but I only have access to it in the UK and Canada. And it’s really visible to me in both the UK and Canada.

    Source date (UTC): 2014-10-08 11:53:00 UTC

  • MARX WAS WRONG ON LABOR. THE PROBLEM IS ORGANIZING PRODUCTION NOT LABOR. LABOR I

    MARX WAS WRONG ON LABOR. THE PROBLEM IS ORGANIZING PRODUCTION NOT LABOR. LABOR IS A COMMODITY WHOSE ONLY VALUE IS DETERMINED BY SCARCITY. THE MORE POPULOUS THE LOWER CLASSES THE LESS SCARCE, THE LESS VALUE.

    Organizing production is where the value is created. Potential labor is merely a commodity like wood or wheat.

    Organizing production, and in particularly organizing voluntary production using nothing but incentives, in an environment where your offered incentives are tested against other incentives, (your theory of demand for your good or service is tested), is where value is created.

    If that was not true, people would never have to look for work. When people look for work they are seeking to ‘buy’ income by participation in the organization of production that they themselves cannot organize and profit from – they are capable only of organizing their OWN labor. Property-Rights Makers(aristocracy), Investors, Bankers, Entrepreneurs, People who calculate in various jobs, down to the people who manage machines and who operate machines, each organize labor – their own and that of others. And we do this all in real time with constantly changing wants, needs, scarcity and prices.

    We are rewarded for the value of our contribution, which is determined by the scarcity of our contribution. Organizing production is more rewarding than any other activity. It is extremely difficult. It is extremely difficult and highly unproductive to organize production involuntarily in a managed economy. It is extremely difficult but highly productive to organize production in a voluntary economy.

    There is no reason that we cannot use both involuntary (the military) and voluntary (the market) organization of production in the same economy. There is no reason that the physical commons cannot be maintained involuntarily as is the military, while the more complex commons and the market itself are organized voluntarily. Only socialism and libertarianism have tried to enforce a monopoly mode of production. And while I agree that an aristocratic, highly homogenous society that that of the English once possessed could produce a libertarian order, the fact of the matter is that even in that order, we had a lot of lower class labor in oversupply, which for all intents and purposes could have been organized, like the military, for the production of commons.

    THE OBJECTIVE OF THE LOWER CLASSES MUST ALWAYS BE TO REDUCE THEIR NUMBER TO INCREASE THEIR TAKE. DEMOCRACY REVERSES THIS AND WORKS AGAINST THEM.

    Source date (UTC): 2014-09-29 05:10:00 UTC