Tag: Economics

Charity Free Riding


As we all know, the gospel is overrun with economic doctrine.  On that note, I noticed a quote about free riding from President Monson (which I just saw at Mormon Times): “I am confident it is the intention of each member of the church to serve and to help those in need,” he said. “At baptism we covenanted to ‘bear one another’s burdens, that they may be light.’ How many times has your heart been touched as you have witnessed the need of another? How often have you intended to be the one to help? And yet how often has day-to-day living interfered and you’ve left it for others to help, feeling that ‘Oh, surely someone will take care of that need.’” Under reasonable assumptions it is not hard to show that if people only give out of an altruistic desire to see others better off, and they have no personal gain (emotional or otherwise) from being the giver, than…

Markets and Consumer Activism

With fair regularity, one hears someone talking of efforts to buy less of some commercial product, either out of a desire for global conservation or because he doesn’t like how it is produced or whatever. Invariably, he comments that his own effect on the market is small, but he wishes to “send a message” or help along some broader movement. Within a plausible model of markets. there are easily understood conditions under which this small effect is actually zero, and remains zero even if he is joined by many like-minded individuals. At which point one wonders if the “message” being sent is “I don’t understand how markets work”.

Fixing the Minimum Wage

It seems pretty clear that we are heading for a hike in the minimum wage. For the many of us who care about poverty reduction, which would be basically all of us, this could be a big deal. The problems with the minimum wage are that it:

The Opportunity Cost of Publishing

In this excellent post, Rosalynde talks about the gender differences in subject material among Deseret Book writers. This renews the discussion brought up by Taryn Nelson-Seawright on the same difference existing in other Mormon outlets. Explanations abound for this phenomena, ranging from differing preferences to piggy discrimination, but most of them are sort of boring. Here’s one that is at least slightly more interesting:

Why Europeans look lazy

It is a well established fact that Europeans perform vastly less formal market work than Americans. A less known fact is that this is a recent development— in the late 50s, Europeans worked about 10% more hours, but this has been in steady decline for 40 years, until now they work about 30% fewer hours than Americans.

Peak oil and taxes

On the Urban thread, Jonathan Green pointed out that the major issue with oil scarcity may not be how much oil we have in the ground, but how much we can pump in a given year. If we are maxed out on supply for a year, any oil disaster creates a huge crunch.

The Mormon Bankrupt

Utah has a very high rate of bankruptcy. In 2000 it hovered at around 7 filings per thousand people– twice the national average. This lonely fact has launched a thousand explanations for why Mormons have such a problem with defaulting on their creditors. Clearly, the thinking seems to be, this shows some of the rot in the Kingdom. Just as clearly, this view has very little support in the data.

Is Poverty Satanic?

One of the most important scriptural texts for the theological consideration of poverty is to be found in Alma 32. This chapter discusses Alma’s mission to the Zoramites. During a sermon on the hill Onidah, Alma is approached by a group of impoverished individuals who were “poor in heart, because of their poverty as to the things of the world” (v. 4). In effect, because of poverty and social exclusion, these people had become an ideal audience for Alma’s missionary efforts. So the question arises: Is poverty therefore a virtuous force, bringing people to Christ who would otherwise reject the gospel message?

Give to the Beautiful

We had a seminar recently from an experimental economist out of the University of Chicago. He has done a variety of cool things using field experiments. Let me mention the one he presented. The experiment involved sending people door to door to do fund raising for a (real) charity. The fundraisers (who were college students) were paid $10/hour. Men averaged about $9/hour in donations. There was little correlation between their productivity and their appearance. Pretty women got about $17/hour in donations.

Choose Your Own Adventure

Let’s play a game. You can choose between two jobs. One pays $50,000 and the other pays $100,000. You know, or can guess, that if you take the first you will give about $5,000/yr in fast offerings and other gifts to the poor. If you make $100,000 you will give about $15,000. You will also pay several thousand more dollars in taxes, but we’ll set that aside. So in one case, you consume about $45,000 and in the other, you consume about $85,000. Which do you take?

Someone’s got it in for me, they’re planting stories in the press

I see that Slate now puts the odds of Harriet Miers confirmation at 70%. Silly Slate, don’t they know that niche is taken? As I’ve mentioned before, the best bet, literally, is to follow the gamblers. And as of press time, they are betting that Miers has a 3 in 10 chance of making it to the Big Bench. Want a second opinion? It’s pretty much the same as the first.

6.6 Billion

According to the IRS, the federal tax code uses up 6.6 billion hours of time for people and businesses to fill out their tax forms. Now, to tell the truth, I sort of like doing my taxes. The numbers are easy to deal with, I often get money back, and it convinces my wife that I am still a net benefit to the household.

How much is it worth?

Suppose you think the world would be a better place if there were no Walmarts in your town. Then the next question is, suppose you could live in the world where Walmart was not allowed, but you had less money.

Illegal Work and the Minimum Wage

Last Saturday my advisor informed me that he never wanted to read my dissertation again, which was his way of saying he was ready to sign off. So I thought I would amuse everyone (well, me anyway) with a very brief recap of my findings. Let me assure you that there is no Mormon angle to this work, so if you are offended by the secular, feel free to move on.

Twelve Differences Between Taxation and Robbery

This is a short primer on the differences between taxation and robbery. At times these two phenomena are sufficiently difficult to differentiate that perhaps such a discussion will be helpful. Feel free to append your own differences to the dozen provided: 1. Taxation is done by a group of people that claim to represent you. Robbers do not claim to represent you.


Occasionally there is some odd comment here or there on this site alluding to “rational choice” models. Now almost nobody in economics uses this phrase, because you don’t need a word to describe what everyone is doing. Yet rationality seems to get some non-economists excited. Why?

“Don’t Be Evil”

Unless you have been spelunking for several days, you have heard a lot more about Google recently than you ever wanted to know. (Of course, if you want to know even more, I invite you to check out my other blog where I have been writing about Google ever since the filing.) This event has attracted so much commentary because Google has provided so much fodder. Most importantly, the founders wrote a letter — “‘An Owner’s Manual’ for Google’s [Future] Shareholders” — that has struck a chord with many who fancy themselves as part of a “corporate social responsibility” movement. And no line in that letter has attracted more attention than this one: “Don’t Be Evil.”

Brigham’s Attack on Communal Economics

One of my most prized worldly possessions is a complete set of the Journal of Discourses. I love these books. I love the way that they look. It probably has something to do with my fascination with law books, which they closely resemble. I also love the sermons. They are a wonderful mass of exhortation, speculation, advice, brow beating, and occasionally sublime testimony. They also have a wonderful ability to surprise you. A couple of Sundays ago, I pulled down a volume at random and started reading a sermon. (I do this from time to time.) While I was doing this, I came across the following attack by Brigham Young on New Testament religious communism. No joke:

Charity and the Ex Post/Ex Ante Dilemma

We are supposed to help those who are in need. The scriptures seem to be quite clear about this. And that, of course, is the problem. I have phrased the issue in what legal theorists call the ex post perspective. We take need as given and the morally relevant question is what our response to the need should be. Our decision is seen as being an after-the-fact (in this case the fact is need) event. The problem, of course, is that we can also look at our decision from what legal theorists call an ex ante perspective. Rather than seeing it as an after-the-fact event we look at it as a before-the-fact event. The event that our decision is “before” in this case is the reaction of others to that decision. Let me give a concrete example: