Wednesday, November 11, 2009
Will Hutton's LSE Lecture
Last Wednesday evening I attended a lecture by Will Hutton at the LSE titled 'Them and Us: How Capitalism without Fairness is Capitalism without a Future' [podcast]. Though some did not like it, I appreciated the talk, but I got the sense that it was, as Hutton said at the outset, the first time he was discussing in public the topics he intends to put into his next book and he was therefore not as structured nor as well-articulated as I expect him to be once he has the book done and dusted.
Hutton covered several broad areas of interest ranging from a theory of justice based on fairness and equality of opportunity (relating to an open access society as he articulates it), improved democracy, a better functioning market, increased government investment in innovation and technology, and improved regulation of financial markets. That was a lot to cover in one lecture, and I think he lost a few people because of being a bit all over the place. Nevertheless, I have rarely come across a lecturer who so closely mirrors my own position on things.
Hutton made several additional points, but I thought that these three general areas were the most interesting and relevant. I believe, particularly, in a system that better approximates equality of opportunity and does allows people to move beyond the context in which their parents were born - a system of zero intergenerational transfer of inequality of opportunity. Unlikely, but at the moment it is something towards which I am inclined. I am not entirely sure how to get there, but the ideas that Hutton conceived seemed, to me, at least a contemporary utterance in a conversation that needs to continue.
Wednesday, September 16, 2009
Little's 'Understanding Society'
In Wealth Inequality, Little touches on the challenges of inequalities in wealth (not just in income), i.e. property, assets, etc, that pervade US society and most contemporary capitalist economies. He provides additional related posts that on Poverty, Growth and Sustainability and on Social Mobility. In his discussion on social mobility he highlights the myth that Americans in the US believe of the US being the most mobile society, which is empirically false. In the US, a parent's socio-economic status, is a strong predictor of a child's socio-economic status, which, for those who believe in some kind of material equality can be problematic. Little also assesses Popper's discussions of falsifiability and historicism in his post Revisiting Popper, another illuminating contribution in which he highlights the problem of tackling the condition of 'falsifiability' in the social sciences where so much varies, and little can be properly controlled.
Anyway, I have found the blog edifying and I have enjoyed the posts, though they often require more time to read and think about than your average blog. I find that I disagree with the author, but I'd like to surround myself with clear thinkers who think differently to me in order to understand better my position.
Tuesday, July 21, 2009
Roemerian Policy in the UK?
There have been a series of articles in the British press recently discussing the report by Alan Milburn on class barriers and inequality in the UK. As a UK citizen and someone moving to the UK soon (from Italy) I think I'm 'entitled' to comment. One of the most interesting quotes for me came from an article in The Guardian, 'Student fees for those who live at home should be axed'. The article quotes Milburn as saying, "Some universities are taking the context of pupil's educational achievement into account in deciding who gets a university place … a kid in a struggling inner-city comprehensive who manages to get one A and two Bs has probably had to work harder than a kid who gets the same result in a wealthy part of town." This is pure Roemerian theory of 'equality of opportunity'. John Roemer articulated his theory in his book Equality of Opportunity. The basic idea hearkens back John Rawls and other political philosiphers when they articulated the different approaches to 'equality of opportunity'.
Equality of opportunity can be separated into two distinct ideas. First, a non-discrimination principle (i.e. your colour, creed, orientation should not affect the commutative justice that you receive when engaging in contracts with others (employment, exchange, etc). Miller (2003, 76) characterizes this well saying, "Justice is a matter of each individual person being treated equally...a central aspect of justice is that people must be treated in a non-arbitrary way: there must be consistency in how one person is treated over time and there must be consistency between people." Second, a 'leveling the playing field' principle in which the goal is to ensure that each person, as much as they can, faces the same 'playing field' that each other person faces. Roemer's theory fits into this second discussion. When you discuss 'leveling the playing field' you need theory to deal with several different aspects of individual motivation. The two pertinent ideas here are the endowments and ambitions of the individual. Your endowments are those things you are 'given' when you arrive in this world: genetics, parents, social economic status, etc. The exact scope of endowments often differentiates the extent to which people agree or disagree on a particular policy. For example, if I have 'poor' genetics (for which I am surely not responsible) and I have something like sickle-cell anaemia as a consequence, many people would argue that there is then scope for a central body (government) to assist me in dealing with this disadvantage. But what if I live in a single parent household and my parent is alcoholic? Am I, as a child, responsible for that? To what extent should the state attempt to help me 'rectify' that endowment? It becomes hazy. What we try to establish is an area in which we have clarity about what an individual does and does not have control over.
Having established an area of control, we can introduce the second ingredient for adequate policy on leveling the playing field: 'ambition sensitivity'. Ambition sensitivity means that our policies must be sensitive to individuals, who, in given circumstance, choose to exert effort to obtain an outcome. Take South Africa. Observe children growing up in 'black', two parent homes, where both parents have 8 years of education, and they live in a township. Let's say that all of these things are 'out of the child's control'. We then assess the levels of effort asserted by these children, say while attending school. There should be some variation over how much effort is expended. We could say that it would be just to reward those children who exert more effort, given their circumstances. The 'measured outcome' of their effort could be 'high school marks', where those who exerted the most effort get Cs on average, whereas those who exerted less effort received Ds or did not finish high school. Contrast this with children growing up in a 'white', two parent household, where both parents have university level education. Again, we say these things are out of a child's control. We observe the children's effort levels. We see some exert a lot of effort, obtaining As, others, Bs, Cs, Ds, and some do not complete high school. Should we reward those children who obtained Cs in the first circumstance in a similar manner to those who obtained As in the second circumstance? Should we reward similarly those people lower in the distributions, given their circumstances and the effort they exert?
Roemer (1998, 6) argues as follows, "equalizing opportunity for educational achievement requires redistributing educational resources in such a way that the differential abilities of children to turn resource into education achievements are compensated for, where those abilities are determined by circumstance beyond the control of the individual." So he would say, reward the Cs as the As and equivalently down the distribution. Now, the problem becomes an empirical one, how do you divide people into types? How do you measure effort? How is effort distributed in groups? All of these are important, but the intuition of rewarding those who expend effort given a certain level of endowments seems to be at the core of this policy proposal and why I thought a brief discussion of it worthwhile.
For those interested, similar work can be found in Meritocracy and Economic Inequality (Arrow, Bowles & Durlauf) and Unequal Chances (Bowles, Gintis & Osborne-Groves). There are tons of books on the subject, but those consider some of the relevant empirics and theory.
Sunday, May 31, 2009
Leeson on Pirates
Leeson provides evidence to indicate that pirate ships ran with democratic institutions (elected captains and quartermasters), that they obeyed unanimously ratified constitutions, and that they had universal suffrage for crew members regardless of race or gender (approximately 25-30% of crews were black and they all had equal voting rights). If you have the time, read the paper, it is a highly commendable piece of work and should be relatively easy to read for the non-economist, though it may require you to look up some ideas like 'principal-agent problems'.
Monday, March 23, 2009
South African Scores an Own Goal for Democracy

Wow! Denying the Dalai Lama a visa, that's what I call self-righteous.
Or maybe it suppresses speech, shows South Africa kowtowing to Chinese interests and promotes illiberal politics inconsistent with the South African constitution.
I could be wrong though. it could be 'an independent, sovereign decision' as Ronnie Mamoepa says.
Hmm... methinks kitty represents my opinion well.
Tuesday, December 23, 2008
This Makes Me Happy
The UN general assembly signed in a declaration for the universal decriminalization of homosexuality. The action was opposed by the US, the Holy See and by a conglomeration of Islamic Countries.
Anyway, I understand that this kind of thing is not binding, but it is a step in the right direction for the promotion of LGBT rights. I am in favour.
See the article from the UN Dispatch here.
Saturday, July 12, 2008
The Libertarian Candidate
He says that libertarians are 'for giving people a chance to realise their full potential', but they are also 'for no one being able to take away the fruits of your labour'. How, therefore, do they propose making sure that everyone is able to realise their potential without taking away the fruits of some people's labour? It's logically inconceivable for them to be able to do both. You cannot have reasonable equality of opportunity without some kind of revenue system. Unless he is talking, simply about non-discrimination which cannot, by any stretch of the imagination, result in any system that is 'for giving people a chance to realise their full potential'.
We need to create a just society first. We can't just assume that society will self-correct. The evidence weighs in heavily against the libertarian ideal of social mobility exists in the United States, especially with the current distributions of wealth and education. Munger makes no comment on how society would allow individual flourishing, as something accessible to all Americans, without any taxes.
Munger comments on "A couple who live on land that they own. that they control and that they can defend." Who regulates what constitutes 'defence'? Moreover, he says later that individuals cannot inflict violence on one another, who would regulate this?
He says too that individuals would be able to drive cars because they own them, but would not have to carry licences. How do we ensure then that individuals have some minimal level of capability? Do we just assume that society is comprised of 'responsible individuals' as Munger wants us to? Has he met any teenage boys? As much as I would like to think that individuals would self-regulate, I have no empirical reason to do so.
If I am misconstruing what he says, or misunderstanding some crucial concept of libertarian theory then please help me to gain clarity.
Friday, July 11, 2008
Cohen Pt. 2
A central argument in Nozick's Anarchy, State and Utopia is that a proletarian who has a choice between death by starvation and working for a capitalist is free as a consequence of self-ownership.
He argues, furthermore that joint ownership the world's resources (a typical socialist ideal) results in the nullification of self-ownership.
The two positions are as follows. For the first, consider a world in which there are individuals ranked throughout society, from the richest capitalist to the poorest proletarian, say a particularly rich hacienda-owner, Cortés, and the landless worker on the hacienda, Peone. Nozick argues that, as long as this distribution came about as a result of a Lockean Proviso-type land acquisition rule, then it is just. Both Cortés and Peone are self-owning and are 'free' to choose.
Contrast this with the second situation situation where two individuals are shipwrecked. Neither of them owns any land on the particularly lush and fertile island. The one individual was disabled in the ship-wreck, the other is able-bodied. Call them Able and Infirm. They decide to own the island jointly, such that neither can make production decisions without the other. As Able cannot produce without the permission of Infirm there are five possible outcomes (see Cohen, 1995:95 for the exact details). I discuss the two interesting outcomes.
iv) Able produces, the amount produced determined independent of his choice, and it exceeds the amount required to sustain both Able and Infirm. They bargain over this surplus.
v) Able can produce a surplus, but he can vary its size; bargaining takes place over both surplus and the amount produced.
Cohen's contribution to this argument is that either
1) Nozick wants individuals to have effective freedom, or
2) Nozick wants individuals to have self-ownership in name alone: formal self-ownership.
Cohen argues that Nozick has a double standard for judging joint-ownership against private ownership of unowned resources. For joint ownership, the individual has self-ownership but is not effectively self-owning contrasted with the situation where the proletarian must work for a capitalist or die, and thus also has self-ownership, but is not effectively self-owning. Either Nozick wants individuals to have effective self-ownership or formal self-ownership. Which is it?
Consequently, accepting autonomy as our goal requires not only an abandonment of Nozickian self-ownership, but also an abandonment of the traditional socialist precept of joint ownership of the world's resources.
Thursday, July 10, 2008
Roemer and Supergirl
Roemer first argues that there are two types of equality of opportunity.
- the nondiscrimination principle
- leveling the playing field
[Aside: he comments how this makes him enemies on the right and left either because he goes too far, or not far enough]
Consider a hypothetical individual who is, by virtue of her circumstances (genes, family, etc) excellent at everything. So excellent, in fact, that the effort required by her to perform any task to some pre-defined level of excellence or achievement (say building a car, or coding a computer program) is absolutely minimal. So minimal in fact that it is indistinguishable from effortlessness. Because this person, by virtue of their abilities (qua circumstances) cannot expend more effort, say to the equivalence of others in a different type, how will they be remunerated or rewarded?
Moreover, as the individual is unique, i.e. they cannot be classified in terms of the given type set, how do we classify them in terms of a decile of effort? Do they necessarily fall in the last decile of some imagined group of super-individuals? Surely that would be inaccurate because, if this group existed, none of them would be able to spend more than (epsilon or) near zero effort.
Any ideas? Am I just crazy, or because this would only be a problem for superpeople is it not worth considering in the political philosophy of real people? I suppose this is just a variant on the 'not rewarding people who are talented' problem, but the issue for me here is that even if they wanted to they (superpeople) couldn't expend more effort. Conundrum. But quite possibly a trivial one.
Tuesday, July 08, 2008
Cohen Pt.1
Today I am going to start some of this with a discussion of the first few chapters of G.A. Cohen's (1995) Self-Ownership, Freedom and Equality which will involve a few posts over the next few days. Cohen's main intention in the book is to strip down and assess the concept of self ownership, to relocate the ideology of socialism without self-ownership as proposed by Marx and to argue that Nozick's argument for self-ownership as effective freedom are flawed and that he applies double standards in terms of the arguments Nozick makes in Anarchy, State and Utopia.
Cohen spends his first chapter discussing Nozick's Wilt Chamberlain example. He first proposes that a proper translation of Nozick's proposal that:
"Whatever rises from a just situation by just steps is itself just." (1)to:
Robert Nozick (1971, 161-2)
"Whatever arises from a just situation as a result of fully voluntary transactions on the part of all the transacting agents is itself just." (2)Leaving aside the discussion of slavery arguments that pertain to the above, Cohen voices discontent with Nozick's argument and declares he would be disturbed if,
G. A. Cohen (1995, 21)
"we can see what the agent thinks he is gaining, but we know that what he will gain is not that, but something he think less valuable; or that what results is not only the gain he expects but also unforeseen consequences which render negative the net value, according to his preferences and standards, of the transaction."Moreover, it is necessary for us to attempt to understand whether individuals would have made a decision if they understood the aggregate effects of their choice ex post. For which Cohen issues a re-translation of (1):
G. A. Cohen (1995, 23)
"Whatever arises from a just situation as a result of fully voluntary transactions which all transacting agents would still have agreed to if they had known what the results of so transacting were to be is itself just. " (3)
Cohen, (1995, 23)
Then he proposes a further argument, which I think is more convincing and progresses as follows: could we conceive a world in which individuals paid some price to watch Wilt Chamberlain, but who knew, in addition, that their payment would be taxed and that Chamberlain would not gain disproportionate wealth and power as a consequence (an option that was supposedly not considered by Nozick)? If we assume normal economic rationality then Chamberlain will play if he sees that the wage he receives is adequate relative to the effort he puts in. Moreover, he could enjoy playing for its intrinsic worth to him, i.e. the joy of being a fantastic professional basketball player for which he gains everything from adulation to sheer exhilaration (I grant that such theorizing can lead to tautologies, but this does not mean that it is irrelevant - work selection endogeneity is still neglected in economics).
In general, Cohen seems to produce a number of valid criticisms of Nozick in this, the content of the first chapter of his book. He also delineates additional arguments on side constraints and on the role of the proletarian in a capitalist society who has freedom, but is effectively unfree. I will probably refer to this topic at a later date when discussing Nozick's idea of self-ownership for individuals in a jointly-owned world and contrasting this with his argument for the freedom of the proletarian. Right now, back to reading.
Monday, July 07, 2008
Research Program
The implication of which is that I will be blogging about the books and articles that I am reading and the attempts that I make to write about them. With respect to the equality of opportunity essay, and equality generally, I am currently reading or have been reading:
Bowles, Arrow and Durlauf (eds) (2000) Meritocracy and Economic Inequality
Roemer, John, (1998) Equality of Opportunity
Roemer, John, (1996) Theories of Distributive Justice
Cohen, G.A. (1995) Self-Ownership, Freedom and Equality
Rawls, J (2005 (1971)) A Theory of Justice
Nozick, R (1974) Anarchy, State and Utopia
As a political philosophy autodidact the base texts that I read to give myself an introduction were:
Kymlicka, Will Contemporary Political Philosophy: An Introduction
Wolff, Jonathan, An Introduction to Political Philosphy
Miller, David, Political Philosophy A Very Short Introduction
So that you know one of the main reasons that I am really trying my best to get to grips with these topics is because I believe strongly in having some kind of consistent theory behind the work that I intend to do in economics. Without this grounding I don't know whether the work I do will be out of anything more than curiousity. I agree furthermore with John Roemer when he says that,
"Unfortunately, too few graduate students today who work in political philosophy or welfare economics have an understanding of both methods. I think that to do good political philosophy o welfare economics it is essential to be cognizant of the main issues and ideas in both disciplines, if not to have both sets of techniques in one's tool kit. Political philosophers with too little knowledge of welfare economics frequently try to reinvent the wheel, usually with bad results. Welfare economists who are poorly read in political philosophy often waste their time on technical questions that philosophy shows have no interest for the study of human welfare."John Roemer, 1998:i, Equality of Opportunity
With respect to group inequality, I am using two reading lists, the first is from Glenn C. Loury for his course on group inequality at Brown, and the second list (which now no longer appears to be online) is from Rajiv Sethi's Inequality course at Columbia.
If you have any suggestions then please feel free to supply them I am open to all kinds of ideas on the abovementioned topics.
