It's always fun to watch partisans spin data into supporting their bigger point, because often, it is unnecessary. The fact that Hitler was nice to dogs and children, is not a paradox--it needs no explaining--because people have many qualities, and no one is pure good or bad, regardless of their net goodness or badness. Thus watching partisans selectively apply reasoning, even when totally unnecessary. If you like McCain, you note the experience of McCain compared to Obama. If you like Obama, you think the limited experience of the Vice Presidential candidate is very important. Inevitably you will be contradicting yourself in short order. Nevertheless, one feels obligated to put every datapoint into a supporting role, as if no evidence can be mitigating or irrelevant.
Jonathan Haidt highlights brain research that shows people make decisions first, often unconsciously, then confabulate answers. He notes an experiment where people whose brain's corpus collosum has been severed, are shown pictures so that a chicken claw is seen by the language portion of the brain, a car stuck in snow is shown to the visual side. These same two sides correspond to controlling the right hand, and left hand, respectively. He would ask the subjects to point to the object that 'goes with' what he saw. The right hand pointed to a chicken, the left hand would point to a shovel. Asked 'why' his left hand pointed to a shovel, he (his language side) would say 'Oh, that's easy. the chicken claw goes with the chicken, and you need a shovel to clean out the chicken shed', as his language side responded. This is a pure confabulation, a rationalization, and it is done unconsciously. The smarter you are, the better your confabulations will be. Your consciousness, and all the rhetoric it can muster, is like a hired lawyer tendentiously arguing for decisions your unconsciousness makes for its own reasons.
Thus, Joe Stiglitz thinks markets are inefficient, and this has been a theme throughout his life. He thinks government can usually make things better in a variety of ways, and improve upon the messiness of markets almost always, in that same way a traffic light improves upon a cross-section without one. The government's advantage, in Stiglitz's mind, is that it is disinterested, and has the greater good in mind, whereas the market is just a bunch of selfish, often quite stupid, individuals. People who believe in free markets, in his view, are doctrinaire ideologues, whereas he sees what is true. That his proofs of inefficiency totally do not address the efficiency of regulation in general, or mention any regulation in specific, is unimportant. He just highlights the inefficiency of a free market under certain assumptions, and satisfies himself that he is proving his point. It helps his point, but is generally insufficient. When one things of the long gestation of the effect of the Clinton tax on 'millionaires' in 1993, and how this encouraged more CEO stock options, and the effect this had on the internet bubble six years later; or how S&L regulation in 1978 and 1982 created the S&L crisis six years later; or how encouraging home ownership via more lax underwriting helped create the subprime crisis a couple years later, highlights that the government's attempts to redress market inadequacies is very tricky, sowing the seeds for things few people anticipate, at great cost.
Living in Minnesota, away from a university setting, I don't feel so upset by my lack of intellectual stimulation. Good ideas are freely available via books, journals, and the web. Further, I do not have a thread of published papers that constrains my views, in that once a series of papers is published, there is a large incentive to defending the deeper theme to these papers to keep them relevant, and we unconsciously spin our interpretation of the world in support of these ideas until we die (eg, did Noam Chomsky learn anything from the fall of the Berlin wall?). While there are exceptions, intellectual elites in any field tend to be very good at rationalizing a weltanshauung they acquired in their 20's if not earlier, no more, no less. As Einstein said, 'Common sense is nothing more than a deposit of prejudices laid down in the mind before you reach eighteen'.
i thought you do have a couple papers yourself. and seem pretty anchored by them, no?
anyway can you post the updated spreadsheet with s&p 12 mos returns when fed cuts the rates? i think it was a 12 for 12 last spring and would be interested to know how many sigmas are we off now.
Eric, if you haven't read Tetlock's "Expert Political Judgment" and the smaller (though less rigorous) "Hedgehog and the Fox" by Berlin, you should. It really confirms your comment about people with a large body of papers having incentives to keep them relevant. Tetlock also shows that the best forecasts are those who can "contradict themselves" in the sense that they can see some value in counterfactuals.
Hope this helps keep the intellectual stimulation going in the North Star State.
Well, my pub list is sufficiently short that I have a lot of leeway. And I haven't been a tenure-track professor at a university, or published in a refereed journal in several years, so I would say I'm not an academic.
McCain knows nothing about the economy, Ron Paul destroyed him in the repub debates. Check youtube.
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