After They Graduate

This report (by Jolly, Yu and Orazem) provides a descriptive overview of the Iowa State University Alumni Survey. In late 2007, 25,000 Iowa State University alumni who received bachelor's degree between 1982 and 2006 were surveyed to obtain information on their career paths, employment status, further education, entrepreneurial activities, community engagement and current income. The on-line and written survey resulted in approximately 5,500 valid returns.

Ideas Campaign

An online ideas forum is currently being disseminated at the moment under the title of "ideas campaign". You can read about it on the website below.

http://www.ideascampaign.ie/

The Text Tax

It has been suggested by the Green Party that a 1c tax on text messages would raise some much needed funds for the public purse, in the current economic crisis. This has been referred to as as “unfair and injust” by Tommy McCabe, director of the Irish Cellular Industry Association (ICIA) - see story here.

How much revenue do we think this would generate? According to the Irish Examiner, a record two billion text messages were sent by Irish mobile phone users in the final three months of last year. Say we assume that this is a steady state level of texting, and that a 1c tax would not deter anyone to send a text. With these assumptions made, then the 1c text tax would produce 8 billion cents in revenue per annum, or an annual sum of 80 million euro.

This is all well and good, but I would like to know more about how this tax would be collected. What I have been able to find is a news story from 2006 which suggests that European Union lawmakers have already considered tax on e-mails and text messages as a way to fund the 25-member bloc in the future. Also, a text message tax was introduced in Sacramento, California last December (see story here). The city sent out letters to telecommunications companies to instruct them to levy the tax on customers' bills.

This is an interesting development in the economics of information. While I don't yet have any fears about negative consequences for the widespread distribution of information, comminication taxes could be undesirable if they prevent useful information exchange. Especially in the so-called Information Economy. On a related note, it was announced yesterday that UCD won SFI strategic research cluster funding of €3.56 million - which will be focused on "data analytics".

Repugnant Preferences

Harvard economist Alvin Roth again asks 'how much for a kidney?', at his talk at the American Enterprise Institute in Washington. Well, we do have two kidneys, so that makes a surplus of one. And imagine what you could buy with 33,000 dollars (the legal price of a kidney in Singapore- a kidney for your troubles). But that's pretty unsavoury right?

The New York times overviews the commentary after the talk. Paul Bloom voices "The problem is not that economists are unreasonable people, it’s that they’re evil people,”. “They work in a different moral universe. The burden of proof is on someone who wants to include” a transaction in the marketplace.

Michael Novak, Steven Pinker, John Haidt and others point out that disgust is a useful heuristic and guide for decision-making. It tells us to pay attention, there's something untoward going on here. The problem is this rapid response can be hijacked. Psychologists can induce feelings of disgust via hypnosis and this can tip the balance in what we endorse as morally acceptable or reprehensible.

Many of our preferences may be rough and ready guides based on accumulated experience. We give money to animal causes based on how cuddly we judge them to be and we find it off-putting to see these animals traded for consumption. It seems our empathy and our disgust are not always guided by ethical principles. But I still believe it is very easy to put a price on a kidney but a lot harder for someone to understand the decision they are making to sell one!

This transaction feels very exploitative. And this is for many reasons, mainly the information asymmetries tied in and the lack of an incentive for the buyer to provide details to address these. It is also questionable as to whether the seller has the capacity to imagine the lifelong consequences of his/her decision. Even if a fully informed decision could be made the emotive consequences of such a trade could be fuel for social unrest amongst those who feel strongly about what they deem socio-economic and 1st to 2nd/3rd world exploitation.

Open Innovation

Moses Ma asks 'how open should innovation be?'

On a more micro level Charles Leadbeater author of 'We Think: Mass innovation, not mass production' claims 'we are what we share' in the web 2.0 world.

Signalling, Cognitive Reflection and the Movie Business

What does a "cold opening" mean in the movie business? According to Colin Camerer and colleagues (here), "Usually, the movies that are not shown in advance are below-average movies as ultimately rated by both critics and moviegoers... but there is a 15 percent increase in box office revenue from not first showing the movie." This is a "cold opening".

So why does it work? Camerer thinks it has to do with people who don't think strategically--who don't have high strategic IQs. "We think it means you can fool some of the people some of the time," he says. "Specifically, you can fool the people who don't pay attention to reviews and who also don't realize that not wanting to show a movie to critics is a bad sign."