Economics is Interesting
(I won't bore you with a whole post about having a happy new year. Just have one, OK? No terrorism, no elections, no natural disasters, no high-profile murder investigations. Let's have a quiet year for once?)
Anyways.
When I changed my major to Comprehensive Business last year, that meant that I was required to take micro- and macroeconomics. I found it to be very dull and uninteresting at the time, but I've since revised my opinion, largely because of posts like
this one over at
Agoraphilia. In this particular post he talks about the long-abandoned practice of dueling as method of conflict resolution, as well as trial by ordeal and wartime atrocities.
What interests me about Agoraphilia is that the authors use economic terms and theories to address all kinds of issues. Allow me to quote his first paragraph:
Tyler Cowen makes an interesting point about duels: they may have served to facilitate conflict resolution. Counterintuitive, but true. Think of nemeses as being engaged in a two-stage game. In the first stage of the game, they try to negotiate to a peaceful settlement of their differences. In the second stage they fight a duel, and this stage is only reached if the first stage results in a stalemate instead of a resolution. If the second stage occurs, both parties can anticipate a high expected cost. (This is true even if you’re the superior gunman. Even if there’s a 90% chance you’ll win, a 10% chance of death or serious injury is nothing to scoff at.) As a result, both parties have a strong incentive to reach a mutually agreeable settlement in the first stage of the game.
You see?
All economic theory is based on a single concept: all human beings seek out the things that they believe will bring them the most utility, or pleasure, at the least cost. In essence,
economics is the study of human motivation, and so it applies to many more situations than a textbook might initially reveal. Agoraphilia is great at pulling back the veil of ennui that so often shrouds the field of economics.
(I'm proud of that last sentence. Is it overwrought? Probably! Am I keeping it anyways? Yes!)
I found the post about
Santaism to be particularly insightful, and I'll again quote the first paragraph here:
Lots of parents lie to their children, repeatedly and ardently, about the existence of Santa Claus. Why? Santaism imposes large costs on parents, both the moral costs of lying and the opportunity costs of losing credit for well-regarded gifts. Yet Santaism does not appear to offer countervailing benefits. You don't need that mythical construct to tie good behavior to good gifts; parents routinely use carrots and sticks to get their kids to act appropriately. As d said of Santa Claus last night, during our long drive home from a dinner party, "What's in it for the parents?"
The rest of the post and the comments are mostly dedicated to answering that final question.
Conclusion: It's a great blog. Five stars out of five. Go read it.
Posted by Blog Jones at
11:52 PM
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Product Quality
In my Production/Operations management class today, we were discussing that oft-abused term, quality. There seems to be some confusion in industry over what the term "quality" means, so here's the easy definition:
To the customer, quality means that the product does what he expects it to do or more.
That's all. Meeting and exceeding expectations. Doing what you say you'll do. It's not that hard.
Posted by Blog Jones at
08:12 PM
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