Gary Becker presented a first economic approach to criminal behavior. In a very standard neoclassical framework he studied this apparently non-economic problem. In particular, Becker assumed rational criminals responding to variables such as the probability of being caught, the severity of the punishment and the labor-market opportunity cost. After this seminal work, a large empirical […]
November 25, 1858, was a very cold day in Concord, Massachusetts. It was then that Henry David Thoreau discovered at Walden Pond some frozen fish he had never seen before, which were “shaped like bream, but had the transverse bars of perch”, as he wrote the following day. “Are they not a new species?” he […]
This post summarizes the article “Confirmation bias with motivated beliefs”, by Charness and Dave, published in Games and Economic Behavior in 2017. Confirmation bias (CB) can be defined as an agent’s tendency to seek, interpret and use evidence in a manner biased toward confirming her existing beliefs or hypotheses. This constitutes a misjudgment that limits […]
This article summarizes the Babcock et al . (2017) , recently published in the American Economic Review. Among the different reasons to explain the gender gap in the labor market one is the process by which men and women advance in the workplace, and among the variables that can affect this advance is the time […]
In the previous entry , I described Nick Bostrom’s argument for the ‘simulation hypothesis’, i.e., the conjecture that we are very, very likely living not in a ‘real’ world, but within some kind of computer simulation, and ended offering some skeptical doubts about its structure by comparing it to Bertrand Russell’s prankish argument about whether […]
One important principle of any sensible social epistemology is that the fraction of crazy-sounding ideas that are really crazy is extremely high. Of course, a lot of crazy-sounding ideas have turned out being right (e.g., the evolution of different species from common ascent, the earth’s being a planet turning around a star, the atomic composition […]
The last issue of the Journal of Economic Perspectives published the article Is China Socialist? by Barry Naughton , which I summarize here. In order to address the question, the first thing Naughton does is to provide a working definition of socialism. Under a broad conception, a plausible socialist system would be judged on four […]
Theory of mind is the ability to attribute mental states—beliefs, intents, desires, knowledge, etc.— to oneself and others and to understand that others have beliefs, desires, intentions, and perspectives that may be different to ourselves. Attributing thoughts to others allows one to predict or explain their actions, and to posit their intentions. It enables one […]
This article summarizes the work by Baker, Bloom and Davis (2016) published in the last issue of the Quarterly Journal of Economics. The economy does not like uncertainty. Or so goes a common saying among economic agents. In fact, economic analysis has formalized this idea at least since the theoretical works of Friedman (1968) and […]
It is said that Washington Irving’s biography of Christopher Columbus, published in 1828, was the work that started the legend that the discoverer of America was the person that convinced the ‘nearly medieval’ Europeans of his time of the sphericity of the earth, a legend that has captured the popular imagination since then. Nothing could […]