Economics of Hell

I've been trying to quantify the impact of religion on economies and came across this:

results show a strong correlation between economic growth and certain shifts in beliefs, though only in developing countries. Most strikingly, if belief in hell jumps up sharply while actual church attendance stays flat, it correlates with economic growth.

I think it's because of the good qualities religion encourages that are important for economic growth. Trust, self-control, sympathy and fairness are all vital to economic cooperation.

Microlending: Good, Not Great

One of the first things I ever pointed to on this blog, Kiva.org and other lending agencies like it, recently got some bad press:

But two new research papers suggest that microcredit is not nearly the powerful tool it has been made out to be. The papers, by leading development economists affiliated with MIT’s Jameel Poverty Action Lab, have not yet been published, but they are already being called the most thorough, careful studies yet done on the topic. What they find is that, by most measures, microcredit does not offer a way out of poverty. It helps a few of the more entrepreneurial poor to start up businesses, and at the margins it may boost the profits of existing microenterprises, but that doesn’t translate into gains for the borrowers, as measured by indicators like income, spending, health, or education. In fact, most microcredit clients actually spend their borrowed money not on a business, but on household expenses, on paying off other debts or on a relatively big-ticket item like a TV or a daughter’s wedding. And while microcredit champions point to microloans as a tool for empowering women, the studies see no impact on gender roles, and find evidence that if any one group benefits more, it’s male entrepreneurs with existing businesses.

That's not to say they aren't helping, but they aren't a miracle solution.

Learning by Teaching: The First 13th Amendment

Here is a fact I recently came across in my AP US History class. Apparently before the familiar 13th Amendment was passed, another one had been proposed called the Corwin Amendment (named after the politician who proposed it). The amendment would have made any attempt to by the federal government to interfere with slavery illegal. This final attempt at preventing the Civil War actually passed through Congress, but was never ratified by the states (more proof that the Civil War was about states vs. federal rights not slavery alone). The most ironic part is that the proposal that later became the 13th Amenmdent actually abolished slavery completely. Even more interesting, becaue the Corwin Amendment was not given a time limit and could technically still be ratified today. Here is a list of other failed amendments, including regulating child labor, equal rights for women and representation in Congress for Washington D.C.

Physical Human Potential

Recently I've been wondering what humans are capable of; here's what I found. A human can

• run 27 mph fast.
  
• jump 30 ft long and 8 ft high.
  
• hold their breath for 11 1/2 minutes.
• lift 586 lbs over their head.
• make this song with voice and a loop pedal (more).
  

Capitalism and Virtue

Many complain that the market is cold and callous, but the Acton Institute for the study of religion and liberty gives four great examples of how markets bring cooperation, not harmful greed:

Trustworthiness. Why do people keep their promises? There are surely many reasons. According to Smith, one of the more prominent is self-interest. He writes: “Where people seldom deal with one another, we find that they are somewhat disposed to cheat, because they can gain more by a smart trick than they lose by the injury that it does to their reputation.” Thus, the principal sanction that holds dishonesty in check is the loss of business that would follow the damage to the businessperson’s reputation. A reputation for being trustworthy will create business opportunities, while even a hint of suspicion of untrustworthiness may preclude such opportunities.

Self-Control. Trustworthiness assumes self-control. What, after all, is promise-keeping if not the ability or disposition to pass up an immediate advantage or gratification? That explains why, for Adam Smith, “self-command is not only itself a great virtue, but from it all the other virtues seem to derive their principal lustre.” Self-control is not a tradeoff between self-interest and the public interest; it is instead a tradeoff between short-term and long-term self-interest.

Sympathy. In a market economy, the fortune of an economic agent depends upon successfully meeting the needs of other people. To the extent that sympathy—or what might be called empathy—helps an entrepreneur to anticipate those needs, it contributes to economic success. Smith knew that sympathy is indirectly linked to self-interest because it might be in our self-interest to work to understand the needs of others.

Fairness. Like the other practical virtues, a reputation for fairness or equity is likely to create business opportunities. Since it is virtually impossible to regulate complex transactions by means of simple written contracts, in many cases parties prefer to restrict their business to those on whom they can rely not to take advantage of them if circumstances change. They are spared considerable transaction costs such as attorneys, auditors, and inspectors of all kinds.

All of the complaints against capitalism, except for maybe equality of results, are when we stray from markets and towards an intrusive government. Whether it's bailouts, bonuses, or stimulus packages, when the government does more protect property rights these virtues are skewed. What do you call a system where costs and benefits are returned to those who caused them? It's not Karma, it's capitalism.

Emptying the Bottle: Early-December '09 Links

Here is a list of the worthwhile sites I've Bookmarked recently:

• In a world where consumers choose their own health care, the "uproar" over mammograms would be a non-issue.
• When government tries to control the economy, it does crazy things; like move Thanksgiving.
• A reliable Scrabble strategy: keep the most common letters in hope of the bonus.
• The rich are getting richer and the poor are getting richer.
• Yawning is good for your health and your attention.
• Facebook is linked to lower grades.
• Great summary of clear ways health care can be reformed [video].
• Tiger Woods' wife isn't just sticking with him, she's leasing herself to him.
• Peak oil is a lie because we will naturally move away from oil, though maybe not as fast as environmentalists want.
• In the future computers only connect to the web. With Google, the future is now [video].

Answering My Own Questions

A while back I considered renaming this blog "Answering My Own Questions", but I figured it's been through enough changes already. So instead, here's a list of random questions floating around my head:

1) What is the Ad Council?
Privately funded organization that helps other non-profits and the government advertise their public service announcements. To me it sounds a lot like the United Way.

2) What continent is Hawaii in?
Apparently there is a lot of controversy over how many actual continents there are. From I can gather it is part of the Oceania ("I remember when Australia was a continent"). This is further evidence for why continents are useless structures of human geography.

3) Who paid for Michael Jackson's funeral?
The memorial cost Los Angeles $1.4 million in security and traffic control. The rest was paid for by the family, the Staples Center, and the Jackson estate.

4) What does "ZIP code" stand for?
It stands for Zone Improvement Plan. It's a backronym from the 1960's that was originally named to imply the mail was quick.

5) After the Bible, what is the best-selling book of all time?
To my disbelief, the answer is Quotations from Chairman Mao at almost 1 billion sold. Here are the runner ups.

We are Royalty

Not only are you rich, you are as rich as the pharaohs of ancient Egypt. We know because we faced the same problem they faced, too much good food and relaxation, also known as heart disease:

subjected [mummies] to whole-body CT scans to look at their insides. 16 mummies still had identifiable hearts or arteries. And 9 of them showed hardening of those arteries.

and here's us:

more than 11 million Americans have been diagnosed as with coronary artery disease

Roots of Prejudice

Whether it is a lack of interracial marriage, an anti-foreign bias in politics or a nativist desire to keep out immigrants, it's clear people naturally prefer people who are like them. Even Switzerland, usually seen as a bastion of tolerance, recently passed a Constitutional referendum banning the construction of Muslim minarets on mosques (the picture on the left is fear mongering propaganda from the campaign). I'm also not exempt from this trend. Most of my friends are white, twenty something, upper middle class, and college educated. I work hard to ensure my bias doesn't reach the classroom, but I think it is important to understand why these preferences exist. I believe the solution is the main point where my religious beliefs and economics background converge, human selfishness.

I believe people are totally depraved and rationally self-interested (or maybe this justifies our inherent extra selfishness). The Bible and other faiths say we should love or neighbor as a ourselves, assuming loving ourselves is the default. You don't have to teach children to be selfish, though sadly we do. So if we are our number one, then number two must be people who are like us. This is true racially, geographically (neighborhood, city, state, nation) and even within our social class. Not only is it easier to put ourselves in someone else's shoes who is like us, it is also more likely to be us in the future. My bet is that people from Boston were more sympathetic to 9/11 victims in New York or that people from Miami better understood the pain felt by Hurricane Katrina victims in New Orleans. There is even evidence we are nicer to the siblings that look like us. The good news is as the world becomes more connected we see how similar humans are all over the world, the less prejudice we there will be.

Worthwhile Sentences on Education

From Justin Wehr: "The single biggest problem in the public school system is that schools are run by politicians in the interest of politicians instead of by businesspeople in the interest of parents."

From Lindsey Jones: "This is not to say that I need my students to love – or even like – what I’m teaching them in order for me to like and appreciate my job. But I gotta say, I’ve started to feel more like a parking cop and less like a purveyor of life-enriching knowledge."

From Tyler Cowen: "Vampires do not seem to mind social disapproval, and in this sense many teens look to them as role models."

From Mark Perry quoting Larry Summers: "male intelligence is inherently more variable than female intelligence."

From Penelope Trunk: "In typical parent fashion, parents stress what they are lacking so that their kids don’t lack it."

*Past worthwhile sentences.