prior probability

Update (8/3): We are happy to report that the comments on Marginal Revolution are now back open!

We interrupt our ongoing review of Anarchy, State, and Utopia to bring a matter of marginal significance (in the scheme of things) to the world’s attention. For years, one of our favorite sites on the Internet has been Marginal Revolution (MR), an eclectic economics blog authored by Tyler Cowen and Alex Tabarrok. But one week ago (24 July 2018), the Marginal Revolution blog announced it was going to completely turn off the comments section to MR “for the time being.” Worse yet, aside from a tongue-in-cheek (and easily refutable) justification for this momentous decision, no explanation was provided. (My guess, however, is that the fraction of defectors on MR–i.e. persons who post inane, irrelevant, or profane comments–grew too large relative to the fraction of cooperators, producing an awful cacophony instead of an enlightened discussion on the front end and making moderation of the comments section a tedious chore on the back end.) Nevertheless, I often learned as much from the comments as I did from the MR blog itself, so I hope this “time being” is a short one and that our colleagues Cowen and Tabarrok reopen the comments.

As we mentioned at the end of our previous post, smack dab in the middle of one of the most original and mind-blowing thought experiments in the history of political philosophy, Nozick digresses to discuss Locke’s views on parental ownership of children. Although the ostensible reason for this Lockean digression is to figure out whether children are to be included in Nozick’s imaginary “one-shareholder, one vote” scheme, we suspect that the true reason for tucking this digression away in this part of the book might be a more sinister one: to conceal some serious internal contradictions in Locke’s labor theory of property rights. Continue reading →

You may have heard the slogan “corporations are people”; but what if people were corporations? The second subsection of Chapter 9 of ASU contains just such a mind-blowing thought experiment. In summary, Nozick borrows the Beckerian concept of “human capital” from the world of economic theory and takes this idea to its logical conclusion. He imagines a society in which each person has the right to incorporate himself as a human corporation, the right to sell off shares of stock in himself, and the right to buy shares in other people. In this imaginary world, it is perfectly legal for people to sell off discrete property rights in themselves, including “the right to decide from which persons they could buy certain services (which they call occupational licensure rights); the right to decide what countries they would buy goods from (import-control rights); … and so on.” (ASU, p. 283, emphasis in original.) Not only is it perfectly legal for people to buy and sell shares of such rights; this practice becomes so widespread and pervasive that, in Nozick’s words (p. 284), “just about everyone sells off rights in themselves, keeping one share in each right as their own, so they can attend stockholders’ meetings if they wish.” Continue reading →

Recall from our previous post that Nozick has asked us to keep an open and uncontaminated mind in the opening subsection of Chapter 9. He will need us to keep an open mind because he is going to present an unorthodox thought experiment in the next subsection of this chapter (pp. 280-292), a thought experiment motivated by a special type of “market failure”: the problem of positive externalities.

So, what is an “externality”? In a word (or two words), this is just a fancy term for “side effects.” In particular, a positive or beneficial externality (the subject of Chapter 9 of ASU) refers to the positive side effects that an activity or transaction confers on those parties who are not directly involved in the activity or transaction. Such a side effect can arise either on the production side or on the consumption side. By way of example, a positive production externality includes a beekeeper who keeps bees for their honey. A positive side effect of beekeeping is the pollination of surrounding crops by the bees. (In fact, the value generated by the pollination may be more important than the value of the harvested honey.) Similarly, an example of a positive consumption externality includes an individual who receives a vaccination for a communicable disease, for he not only decreases the likelihood of his own infection, but also decreases the likelihood of others becoming infected through contact with him. Continue reading →

Nozick devotes the first subsection of Chapter 9 (pp. 277-279) to analogical reasoning and to what I like to call “the mental contamination problem.” According to Nozick, one of the problems with reasoning by analogy is our inability to keep an open and uncontaminated mind. Why does this problem occur? Because whenever we are presented with a hypothetical example or with a body of data, we will invariably be tempted to evaluate that example or data through the filter of our theoretical priors, or as Nozick puts it (p. 277, emphasis in original): Continue reading →

Chapter 9 of Anarchy, State, and Utopia (ASU), the penultimate chapter of this classic book, is titled “Demoktesis.” Spoiler alert: according to Wikipedia, demoktesis is a thought-experiment designed to show the incompatibility of democracy (one-man, one-vote) with libertarian theory and with Nozick’s entitlement theory, i.e. Nozick’s defense of the minimal state. So, suffice it to say, we are headed into some real deep waters here! Nozick’s thought-experiment is divided into three subsections as follows:

• Consistency and parallel examples (pp. 277-279)
• The more-than-minimal-state derived (pp. 280-292)
• Hypothetical entities (pp. 292-294)

Nozick begins Chapter 9 by asking, “Is there some way to continue our story of the origin of the (minimal) state from the state of nature to arrive, via only legitimate steps which violate no one’s rights, at something more closely resembling a modern state?” (ASU, p. 276, emphasis in original, citation omitted.) In other words, if Nozick’s minimal state is the only type of state that is morally justified, why does it exist nowhere on earth? We will jump into Chapter 9 in our next blog post.

During a bout of insomnia, we discovered a new genre of literature and storytelling called micro flash fiction. (Hat tip: @ESYudkowsky.) Below is a sample:

Nozick devotes the last three subsections of Chapter 8 (pp. 268-275) to two interwoven tasks: (1) reiterating his conception of a minimal state, and (2) responding to various justifications made in favor of a more extensive state. Recall that, for Nozick, the ideal state is the minimal state, i.e. one that is limited to enforcing contracts, prohibiting fraud and force, and punishing theft. Nevertheless, Nozick identifies two different arguments in favor of a more extensive state. One is that economic equality (via some form of compulsory redistribution) is necessary in order to promote political equality (the political equality argument). The other is that people should have a voice over decisions that affect them (the voice argument). Nozick debunks and discredits both of these arguments as follows: Continue reading →

Nozick begins the eighth section of Chapter 8 of ASU (pp. 265-268) by making a strong case in favor of compulsory redistribution! (Yes, you heard that right. Again, I will summarize Nozick’s argument in my own words.) Let’s assume that I am an altruist and that I want to contribute to a good cause, such as helping the poor. Despite my altruistic inclination, there are two reasons why I may not end up making any charitable contributions. One is the free rider problem. Simply put, why should I make any charitable contributions if everyone else is already contributing to my favorite causes? The other reason is fear of being exploited. That is, I might be more than willing to contribute $n to help the poor, but only if a sufficient number of other individuals were also contributing to my cause; otherwise, I might feel like a sucker if I am the only one giving. Continue reading →

Nozick takes a short detour in the seventh section of Chapter 8 of ASU (pp. 262-265), where he makes a conjecture about the structure of rights to engage in relationships with others. At one point, Nozick states (p. 264): “Rights to engage in relationships and transactions have hooks on them, which must attach to the corresponding hook of another’s right that comes out to meet theirs.” Moreover, according to Nozick (ibid., emphasis in original): “Adults normally will have the right to [establish] a relationship with any other consenting adult who has this right, but the right may be forfeited in punishment for wrongful acts.” This conjecture, however, generates a number of intractable problems: Continue reading →