In the 1930s and 1940s, academic economists were engaged in the so-called “socialist calculation debate,” a theoretical quarrel that was not fully resolved until the fall of the Berlin Wall in 1989. (Until then, some economists seriously believed that a command-and-control economy like that of the now-defunct USSR could outperform a free market economy.) Fast forward 80 years. Now, academic economists are squabbling over “empirical economics.” Our friends and colleagues Russ Roberts and John Cochrane, for example, have mounted a powerful attack against empirical economics, arguing that empirical models in economics lack any real predictive power, while on the other side of this empirical debate, fellow economists like Adam Ozimek and Noah Smith have argued with equal passion and vigor that their fancy models are useful. Like the socialist calculation debate of yore, only time will tell who’s right regarding the value of empirical economics, but in the meantime, it’s ironic that Ozimek and Smith’s arguments in defense of empiricism are themselves not empirical-based.
Take the quiz here. (Hat tip: the amazing Tyler Cowen.)
We are big fans of Richard Epstein’s book Simple Rules for a Complex World (Harvard University Press, 1995) for many reasons. Consider aviation. In place of this convoluted academic analysis, we would advocate for the following simple rule: carriers may not remove a passenger once he or she or it has boarded an airplane and taken their assigned seat. Otherwise, without such a simple rule, efficient Coasian bargaining isn’t possible. (If you have 22 minutes to spare, below is a short video of Professor Epstein lecturing on his ideas.)
Why are some chemical weapons like Napalm and Agent Orange okay to use (as long as the U.S. military uses them) but others off limits? If we are going to continue acting as the world’s policeman and all-around moral enforcer (with disastrous results), then we should at least stop using chemical weapons ourselves and stop being so sanctimonious and self-righteous.
1. 🇨🇺 Cuba: Fulgencio Batista (bad); Fidel Castro (way worse)
2. 🇮🇷 Iran: Mohammad Reza Shah Pahlavi (bad); Grand Ayatollah Ruhollah Khomeini (way worse)
3. 🇻🇪 Venezuela: Rafael Caldera (bad); Hugo Chavez/Nicolas Maduro (way worse)
4. 🇮🇶 Iraq: Saddam Hussein (bad); ISIL (way worse)
5. 🇱🇾 Libya: Muammar al-Qaddafi (bad); ISIL (way worse)
6. 🇸🇾 Syria: you get the picture
As members of the so-called “rationality community” like to say, the plural of anecdote is not evidence. (In 2016, for example, United Airlines denied boarding to only 3,765 of its more than 86 million passengers on overbooked flights, according to the U.S. Department of Transportation.) But it looks like they are wrong, at least if consumers stop flying on United after their recent public relations disasters. First, United kicked off some little girls from a flight for wearing leggings. Now, United has forcibly removed an elderly paying passenger from his seat to make room for STAFF! (Maybe United needs to rebrand: Greyhound Air.)
Legal memo to United: “possession is nine-tenths of the law.”