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Archive for the ‘musings’ Category

And a few tidbits about Damien Geradin, too

Posted by Geoffrey Manne on May 6, 2012

Catching up on my blog reading, I see Chillin’ Competition had a Friday Slot interview with Damien Geradin recently, as well.  Also worth checking out.  I especially like this:

What you like the least about economics in competition law?

Mind boggling theories disconnected from the real world. These are a complete waste of time.

Amen, Brother!

Posted in antitrust, musings | Tagged: | Leave a Comment »

A few tidbits about Herb Hovenkamp

Posted by Geoffrey Manne on May 6, 2012

Our friends at Chillin’ Competition have a short interview with Herb Hovenkamp up as part of their “Friday Slot” series.  Here are a couple of tidbits to entice you to go read the whole thing:

“Oscar” of the best antitrust law book? Non-antitrust book?

Best Antitrust Book:  Oliver E. Williamson, Markets and Hierarchies: Analysis and Antitrust Implications (1975).

Best non-antitrust book:  Louis Menand, The Metaphysical Club: A Story of Ideas in America (2001)

* * *

Let’s do it like economists => assume that you could change 3 rules, principles, judgments, institutions in the current EU antitrust system. What would you do? 

Answer: I would speak only to the United States system, where I would change the following three things:

A.  The per se rule against tying arrangements (insofar as it still exists)

B.  The strict recoupment requirement in predatory pricing cases when prices are clearly below average variable cost

C.  The federal courts’ repeated refusal to see the competitive harm in reverse payment settlements in pharmaceutical infringement cases

* * *

A piece of “counterfactual” analysis: what would you do if you weren’t in your current position?

I would be either a Dutch Reformed clergyman or a Professor of American History

* * *

Favorite movies?

Sappy chickflicks: The NotebookSleepless in SeattleTitanic

Posted in antitrust, film, musings | Tagged: | Leave a Comment »

My Professor, My Judge, and the Doctrine of Judicial Review

Posted by Thom Lambert on April 3, 2012

Imagine if you picked up your morning paper to read that one of your astronomy professors had publicly questioned whether the earth, in fact, revolves around the sun.  Or suppose that one of your economics professors was quoted as saying that consumers would purchase more gasoline if the price would simply rise.  Or maybe your high school math teacher was publicly insisting that 2 + 2 = 5.  You’d be a little embarrassed, right?  You’d worry that your colleagues and friends might begin to question your astronomical, economic, or mathematical literacy.

Now you know how I felt this morning when I read in the Wall Street Journal that my own constitutional law professor had stated that it would be “an unprecedented, extraordinary step” for the Supreme Court to “overturn[] a law [i.e., the Affordable Care Act] that was passed by a strong majority of a democratically elected Congress.”  Putting aside the “strong majority” nonsense (the deeply unpopular Affordable Care Act got through the Senate with the minimum number of votes needed to survive a filibuster and passed 219-212 in the House), saying that it would be “unprecedented” and “extraordinary” for the Supreme Court to strike down a law that violates the Constitution is like saying that Kansas City is the capital of Kansas.  Thus, a Wall Street Journal editorial queried this about the President who “famously taught constitutional law at the University of Chicago”:  “[D]id he somehow not teach the historic case of Marbury v. Madison?”

I actually know the answer to that question.  It’s no (well, technically yes…he didn’t).  President Obama taught “Con Law III” at Chicago.  Judicial review, federalism, the separation of powers — the old “structural Constitution” stuff — is covered in “Con Law I” (or at least it was when I was a student).  Con Law III covers the Fourteenth Amendment.  (Oddly enough, Prof. Obama didn’t seem too concerned about “an unelected group of people” overturning a “duly constituted and passed law” when we were discussing all those famous Fourteenth Amendment cases – Roe v. Wade, Griswold v. Connecticut, Romer v. Evans, etc.)  Of course, even a Con Law professor focusing on the Bill of Rights should know that the principle of judicial review has been alive and well since 1803, so I still feel like my educational credentials have been tarnished a bit by the President’s “unprecedented, extraordinary” remarks.

Fortunately, another bit of my educational background somewhat mitigates the reputational damage inflicted by the President’s unfortunate comments.  This morning, the judge for whom I clerked, Judge Jerry E. Smith of the U.S. Court of Appeals for the Fifth Circuit, called the President’s bluff.

Here’s a bit of transcript from this morning’s oral argument in Physicians Hospital of America v. Sebelius, a case involving a challenge to the Affordable Care Act:

Judge Jerry E. Smith: Does the Department of Justice recognize that federal courts have the authority in appropriate circumstances to strike federal statutes because of one or more constitutional infirmities?

Dana Lydia Kaersvang (DOJ Attorney): Yes, your honor. Of course, there would need to be a severability analysis, but yes.

Smith: I’m referring to statements by the President in the past few days to the effect…that it is somehow inappropriate for what he termed “unelected” judges to strike acts of Congress that have enjoyed – he was referring, of course, to Obamacare – what he termed broad consensus in majorities in both houses of Congress.

That has troubled a number of people who have read it as somehow a challenge to the federal courts or to their authority or to the appropriateness of the concept of judicial review. And that’s not a small matter. So I want to be sure that you’re telling us that the attorney general and the Department of Justice do recognize the authority of the federal courts through unelected judges to strike acts of Congress or portions thereof in appropriate cases.

KaersvangMarbury v. Madison is the law, your honor, but it would not make sense in this circumstance to strike down this statute, because there’s no –

Smith: I would like to have from you by noon on Thursday…a letter stating what is the position of the Attorney General and the Department of Justice, in regard to the recent statements by the President, stating specifically and in detail in reference to those statements what the authority is of the federal courts in this regard in terms of judicial review. That letter needs to be at least three pages single spaced, no less, and it needs to be specific. It needs to make specific reference to the President’s statements and again to the position of the Attorney General and the Department of Justice.

I must say, I’m pretty dang proud of Judge Smith right now.  And I’m really looking forward to reading that three-page, single-spaced letter.

Posted in commerce clause, constitutional law, health care, health care reform debate, musings, politics | 167 Comments »

Religious Liberty for Dummies

Posted by Thom Lambert on February 9, 2012

According to Senators Barbara Boxer, Jeanne Shaheen, and Patty Murray, the Catholic Church is the real bully in the fight over whether religious employers must include coverage for contraception in the insurance policies they offer their employees.  In yesterday’s Wall Street Journal, the three responded to, in their words, the “aggressive and misleading campaign” against this new Obamacare mandate.  They wrote:

Those now attacking the new health-coverage requirement claim that it is an assault on religious liberty, but the opposite is true.  Religious freedom means that Catholic women who want to follow their church’s doctrine can do so, avoiding the use of contraception in any form.  But the millions of American women who choose to use contraception should not be forced to follow religious doctrine, whether Catholic or non-Catholic.

The three Senators seem to believe that as long as the government doesn’t force Catholic women to use birth control and the morning after pill, religious liberty is protected.  They also believe that in praying to the Almighty One (not that Almighty One) for permission not to pay for a medical intervention that offends their deeply and sincerely held religious beliefs, Catholic officials are trying to force women to follow their religious doctrine.

That’s ridiculous, and it shows how desperate the defenders of President Obama’s intrusion on individual conscience have become.  In a world in which religious employers were exempt from paying for a measure that violates their sacred beliefs, any woman who didn’t share those beliefs would be perfectly free to obtain birth control.  The Catholic Church, after all, doesn’t have the power to overrule Griswold v. Connecticut.

By contrast, in the world of Mr. Obama’s contraception mandate, Catholic officials who choose to follow their consciences by refusing to subsidize interventions that violate their religious beliefs may ultimately be thrown in jail.  That, Honorable Senators, is a full-frontal assault on religious liberty.

[More on the deeply misguided contraception mandate here.]

Posted in constitutional law, First amendment, free to choose, health care reform debate, musings, politics, regulation | 15 Comments »

What if the Government Ordered the Human Rights Campaign to Cover Conversion Therapy for Gays?

Posted by Thom Lambert on January 23, 2012

A thought experiment:

It’s late January 2016.  Newt Gingrich is President.  The House of Representatives is solidly Republican, and there’s a slight Republican majority in the Senate.  Because Republicans lack a filibuster-proof majority in the Senate, the Affordable Care Act (a.k.a. Obamacare) remains on the books.  (The reconciliation process, which allowed the law to be enacted without supermajority support in the Senate, could not be used to repeal the law.)  The Act continues to require employer-provided insurance to provide full coverage for all preventive care measures.

Secretary Rick Santorum of the Department of Health and Human Services has determined that conversion therapy for gay males will help prevent all sorts of costly health problems.  HIV and related health problems, it seems, are extremely costly to treat and are far more common among gay men than among straight men.  HHS has determined that the most modern conversion therapies can cheaply and successfully alter sexual orientation or, at a minimum, reduce homosexual impulses so that they can be managed by homosexually oriented patients who would prefer not to engage in homosexual activity.

President Gingrich and Secretary Santorum have therefore mandated that employer-provided health insurance policies cover gay conversion therapies.  Claiming to be sensitive to the concerns of gay groups, they have included a narrow exemption for employers who don’t employ or serve significant numbers of straight people.  In reality, though, none of the major gay and lesbian advocacy groups (e.g., the Human Rights Campaign, GLAAD) or publishing organizations (e.g., The Advocate, OUT Magazine) could qualify for this exemption because all employ a great many gay-affirming straight people and include outreach to heterosexuals as one of their objectives.     

Can you imagine the howls from the New York Times, the television networks, and basically every other political commentator in America?  Andrew Sullivan might just explode.  And rightly so.  Forcing gay groups to pay for a procedure that so deeply offends their core principles would be beyond the pale in a liberal society that respects personal conscience and the right of individuals to associate in groups that share their values – a right that can exist only if groups are allowed to express those values and, to the extent they aren’t hurting others, order their affairs according to them.  

So why do President Obama and HHS Secretary Kathleen Sebelius get a pass when they order Catholic schools, hospitals, and social service agencies to cover birth control, sterilization, and the morning after pill?  The ridiculous “exemption” they created shows how little they know about what churches actually do:  Christ’s apostles themselves wouldn’t have qualified because they, like any church worth its salt, served multitudes of nonbelievers.  Providing an extra year to come into compliance does nothing to alleviate the fundamental problem (Is the doctrinal conflict going to disappear next year?) and is a transparent attempt to deflect media attention until after the 2012 election.  There are lots of Catholics in Ohio and Pennsylvania, after all.

One might say that my analogy fails because the science doesn’t show that gay conversion therapy actually works, and it therefore wouldn’t reduce total health care costs.  But that’s beside the point.  Even if there were a therapy that could cheaply and effectively make gay people straight (i.e., a pill or a quick surgical procedure) it would still be inappropriate to force groups whose central objective is to affirm gay people and fight anti-gay bias to provide coverage for such a therapy.

My point is not to defend the Catholic Church’s views on birth control (with which I disagree), to defend gay conversion therapy (which I think is a harmful crock), or to question the mission of gay rights organizations.  Instead, I mean to point out that governments in liberal societies do not force individuals or voluntary associations to violate their consciences where their conscience-following does not violate the rights of others.  Yet another example of Obamacare’s heavy hand.

Posted in free to choose, health care reform debate, musings, politics, regulation | 10 Comments »

Welcome Baby 7B!

Posted by Thom Lambert on October 31, 2011

According to the United Nations, sometime around Halloween a newborn baby will push the world’s population above seven billion people.  Welcome to our spectacular planet, Little One!

I should warn you that not everyone will greet your arrival as enthusiastically as I.  A great many smart folks on our planet—especially highly educated people in rich countries like my own—have fallen under the spell of this fellow named Malthus, who once warned that our planet was “overpopulated.”  Although Mr. Malthus’s ideas have been proven wrong time and again, his smart and influential disciples keep insisting that your arrival spells disaster, that this lonely planet just can’t support you. 

Now my own suspicion is that modern day Malthusians, who are smart enough to know that actual events have discredited their leader’s theories, continue to parrot Mr. Malthus’s ideas because they lend support to all manner of governmental intervention into private affairs.  (These smarty-pants Malthusians, who are well-aware of their own intelligence, tend to think they can arrange things better than the “men and women on the spot” and are constantly looking for reasons to go meddling in others’ business!)  Whatever their motivation, Mr. Malthus’s disciples just won’t shut up about how our planet is overpopulated.

You should know, though, that this simply isn’t true.  The first time you hear one of Mr. Malthus’s followers decrying your very existence by insisting that our planet is overpopulated, you should ask him or her:  “Overpopulated relative to what?”  Modern Malthusians can never give a good answer to that question, though they always try.

Sometimes they say “living space.”  But that’s plain silly.  Our planet is really pretty huge.  Indeed, if all seven billion people on the planet moved to the state ofAlaska, each person would have 2,300 square feet of living space!  Now I realize lots of cities get crowded, but that’s because people choose to live in those areas—they’ve decided that the benefits of enhanced economic opportunity in a densely populated area outweigh the costs of close confines.  If they really wanted extra living space, they could easily find it in our planet’s vast uninhabited (or sparsely inhabited) regions.

Sometimes modern day Malthusians say the planet is overpopulated relative to available food.  Wrong again.  In the nations of the world where institutions have evolved to allow people to profit from coming up with new ideas that enhance welfare, individuals have developed all sorts of ways to get more food from less land.  Accordingly, food production has always outpaced population growth.  Now, modern day Malthusians will probably tell you that food prices have been rising in recent years – a sign that food is getting scarcer relative to people’s demand for it.  But that’s because governments, beholden to powerful agricultural lobbyists, have been requiring that huge portions of agricultural output be diverted to fuel production even though the primary biofuel (ethanol) provides no environmental benefit.  As usual, it’s actually bad government policy, not population growth, that’s creating scarcity.

In recent days, Mr. Malthus’s disciples have insisted that the world is overpopulated relative to available resources.  Nothing new here.  Back in the 1970s, lots of smart folks contended that the earth was quickly running out of resources and that drastic measures were required to constrain continued population growth.  One of those smarty pants was Stanford University biologist Paul Ehrlich, who, along with his wife Anne and President Obama’s science czar John Holdren, asked (in all seriousness): “Why should the law not be able to prevent a person from having more than two children?”  (See Paul R. Ehrlich, Anne H. Ehrlich & John P. Holdren, Ecoscience 838 (1977).)  (Ehrlich also proclaimed, in his 1968 blockbuster The Population Bomb, that “The battle to feed all of humanity is over. In the 1970s hundreds of millions of people will starve to death in spite of any crash programs embarked upon now. At this late date nothing can prevent a substantial increase in the world death rate.”)

In 1980, Prof. Ehrlich bet economist Julian Simon (a jolly fellow who would have welcomed your birth!) that the booming population would raise demand for resources so much that prices would skyrocket.  Mr. Simon thought otherwise and therefore allowed Prof. Ehrlich to pick five metals whose price he believed would rise over the next decade.  As it turns out, the five metals Prof. Ehrlich selected — chromium, copper, nickel, tin, and tungsten – fell in price as clever, profit-seeking humans discovered both how to extract more from the earth and how to substitute other, cheaper substances.  Mr. Simon was not at all surprised.  He recognized that the long-term price trend of most resources points downward, indicating that resources are becoming more plentiful, relative to human needs, over time.  (Modern Malthusians may point to some recent price trends showing rising prices for some resources, especially precious metals.  It’s likely, though, that those price increases are due to the fact that central banks all over the world have been creating lots and lots of money, thereby threatening inflation and causing investors to hold their wealth in the form of commodities.)

The fundamental mistake Mr. Malthus’s disciples make, Little One, is to assume that our planet is the ultimate source of resources.  That’s just not true.  Our planet does contain lots of useful “stuff,” but it’s human ingenuity – something only you and those like you can provide – that turns that stuff into “resources.”  Take oil, for instance.  For most of human history, messy crude oil was a source of annoyance for landowners.  It polluted their water and fouled their property.  But when whale oil prices started to rise in response to scarcity (or, put differently, when the world started to look “overpopulated” relative to whale oil), some clever, profit-seeking folks discovered how to turn that annoyance into kerosene, and eventually petroleum.  Voila!  A “resource” was created!

Just as people once worried about overpopulation relative to whale oil supplies, lots of folks now worry about overpopulation relative to crude oil.  Well I’m not that worried, and you shouldn’t be either.  As oil prices rise, more and more clever profit-seekers will turn their energies toward finding new ways to obtain oil (e.g., hydraulic facturing), new techniques for reducing oil requirements (e.g., enhanced efficiency), and new substitutes for oil (e.g., alternative fuels).  Mr. Malthus’s disciples will continue to fret about the limits to growth, but the historical record is clear on this one:  Human ingenuity – the ultimate resource – always outpaces the diminution in useful “stuff.”

And so, Little Resource, your arrival on our planet should be celebrated, not scorned!  As you and your fellow newborns flex your creative muscle, you’ll develop new sources of wealth for the world.  As you do so, birth rates will plummet, as they typically do when societies become wealthier, and the demand for a cleaner environment, demand that rises with wealth, will grow.  We therefore need not worry about “overpopulation.”

We do, though, need to ensure the survival of those institutions – property rights, free markets, the rule of law – that encourage resource-creating innovation.  I, for one, promise to do my best to defend those institutions so that you and your fellow newborns can add to our planet’s resource base.

Posted in economics, entrepreneurship, environment, food, free to choose, markets, musings, regulation, technology | 10 Comments »

Google, Vertical Integration, and Beer

Posted by Josh Wright on October 20, 2011

First, Google had the audacity to include a map in search queries suggesting a user wanted a map.  Consumers liked it.  Then came video.  Then, they came for the beer:

Google’s first attempt at brewing has resulted in a beer that taps ingredients from all across the globe. They teamed up with Delaware craft brewery Dogfish Head to make “URKontinent,” a Belgian Dubbel style beer with flavors from five different continents.

No word yet from the Google’s antitrust-wielding critics whether integration into beer will exclude rivals who vertical search engines who, without access to the beer, have no chance to compete.  Yes, there are specialized beer search sites if you must know (or local beer search).  Or small breweries who, because of Google’s market share in search, cannot compete against Dogfish Head’s newest product.  But before we start the new antitrust investigation, Google has offered some new facts to clarify matters:

Similarly, the project with Dogfish Head brewery was a Googler-driven project organized by a group of craftbrewery aficionados across the company. While our Googlers had fun advising on the creation of a beer recipe, we aren’t receiving any proceeds from the sale of the beer and we have no plans to enter the beer business.

Whew.  What a relief.  But, I’m sure the critics will be watching just in case to see if Dogfish Head jumps in the search rankings.  Donating time and energy to the creation of beer is really just a gateway to more serious exclusionary conduct, right?  And Section 5 of the FTC Act applies to incipient conduct in the beer market, clearly.  Or did the DOJ get beer-related Google activities in the clearance arrangement between the agencies?

Posted in alcohol, antitrust, beer, clearance, doj, federal trade commission, google, musings | 2 Comments »

Law Review Publishing Norms and Inefficient Performance

Posted by Thom Lambert on October 20, 2011

One of my colleagues recently accepted a publication offer on a law review article, only to receive a later publication offer from a much more prestigious journal.  This sort of occurrence is not uncommon in the legal academy, where scholars submitting articles for publication do not offer to publish their work in a journal but rather solicit publication offers from journals (and generally solicit multiple offers at the same time).  One may easily accept an inferior journal’s offer before receiving another from a preferred journal. 

I’ve been in my colleague’s unfortunate position three times: once when I was trying to become a professor, once during my first semester of teaching, and once in the semester before I went up for tenure.  Each time, breaching my initial publication contract and accepting the later-received offer from the more prestigious journal would have benefited me by an amount far greater than the harm caused to the jilted journal.  Accordingly, the welfare-maximizing outcome would have been for me to breach my initial publication agreement and to pay the put-upon journal an amount equal to the damage caused by my breach.  Such a move would have been Pareto-improving:  I would have been better off, and the original publisher, the breach “victim,” would have been as well off as before I breached.  

As all first-year law students learn (or should learn!), the law of contracts is loaded with doctrines designed to encourage efficient breach and discourage inefficient performance.  Most notable among these is the rule precluding punitive damages for breach of contract:  If a breaching party were required to pay such damages, in addition to the so-called “expectancy” damages necessary to compensate the breach victim for her loss, then promisors contemplating breach might perform even though doing so would cost more than the value of the performance to the promisee.  Such performance would be wasteful.

So why didn’t I — a contracts professor who knows that a promisor’s contract duty is always disjunctive: “perform or pay” — breach my initial publication agreements and offer the jilted journal editors some amount of settlement (say, $1,000 for an epic staff party — an amount far less than the incremental value to me of going with the higher-ranked journal)?  Because of a silly social norm frowning upon such conduct as indicative of a flawed character.  When I was looking for a teaching job, I was informed that breaching a publication agreement is a definite no-no and might impair my job prospects.  After I became a professor, I learned that members of my faculty had threatened to vote against the tenure of professors who breached publication agreements.  To be fair, I’m not sure those faculty members would do so if the breaching professor compensated the jilted journal, effectively “buying himself out” of his contract.  But who would run that risk?

So I empathize with my colleague who now feels stuck publishing in the less prestigious journal.  And, while I recognize the difference between a legal and moral obligation, I would commend the following wise words to those law professors who would imbue law review publishing contracts with “mystic significance”:

Nowhere is the confusion between legal and moral ideas more manifest than in the law of contract.  Among other things, here again the so-called primary rights and duties are invested with a mystic significance beyond what can be assigned and explained.  The duty to keep a contract at common law means a prediction that you must pay damages if you do not keep it — and nothing else.  If you commit a tort, you are liable to pay a compensatory sum.  If you commit a contract, you are liable to pay a compensatory sum unless the promised event comes to pass, and that is all the difference.  But such a mode of looking at the matter stinks in the nostrils of those who think it advantageous to get as much ethics into the law as they can.

Oliver Wendell Holmes, Jr., The Path of the Law, 10 Harv. L. Rev. 457 (1897).  

Posted in contracts, law school, musings | 2 Comments »

Undermining Community for Specious Public Health Benefits

Posted by Thom Lambert on August 28, 2011

We classical liberals are often criticized for undermining communitarian values by emphasizing individual liberties.  In reality, though, a liberal society (in the classical sense, not the welfare-state sense) fosters community by allowing people to associate in ways they find most meaningful.  Indeed, one of the great things about a liberal, live-and-let-live city is that it can accommodate so many communities that cater to different preferences and values:  Orthodox Jews, devout Muslims, evangelical Protestants, gays and lesbians, and various ethnic groups can create their own little communities to foster shared values.  As long as nobody injures the person or property of another, folks are free to commune as they will.

Unfortunately, the sort of liberalism that fosters the spontaneous formation of community groups can be tough to maintain, especially when governments create regulatory bodies charged with “protecting” people from improvident choices.  Those regulators, under constant pressure to “do something” in order to protect their turf, often impose rules that prevent people from communing as they will, even when they’re not hurting anybody else.

I was reminded of this point yesterday when I read that the Bloomberg administration, in the name of “public health,” is cracking down on bars that allow dogs (even in outdoor areas).  How sad for New York City.  Nothing builds community better than a collection of spaces — bars, coffeshops, diners, etc. — where neighbors can go to relax, converse, and share their lives.  And nothing is more likely to keep people coming back and to get them talking to each other than to allow them to bring their dogs.  If you don’t believe me, head down to your local dog park and watch people interact.  Nobody’s a stranger at the dog park. 

Of course, there are lots of people who are scared of dogs, or don’t like them, or believe that their mere presence renders a place unsanitary (even though millions of Americans have dogs in their homes – often in their beds – and seem to suffer no ill-effects).  Such dog phobes needn’t worry.  Profit-seeking entrepreneurs will cater to their preferences by creating dog-free spaces.  The rest of us, then, can head down to our canine-friendly pubs and bond with our fellow dog lovers.

As much as I hate to say it, the French are sometimes right.

Posted in food, markets, musings, regulation | 9 Comments »

The Economics of Gang Colors

Posted by Josh Wright on August 3, 2011

Here.  The article highlights an a paper stressing the role of gang colors as a commitment device to ensure higher quality criminals.  The mechanism works, the authors contend, because gang colors are a handicap that increases the probability of detection and thus, low quality criminals are less likely to be able to “afford” wearing them.  Here’s the WSJ description:

Like certain ostentatious displays by males in the animal kingdom, gang colors serve as a handicap, Mell argues: Yes, they make it more likely that the person wearing them will be caught. Yet they semaphore the following message: If I’m still willing to commit crimes when I have this handicap, I must be pretty good at evading the police. Incompetent criminals couldn’t get away with wearing gang colors.

Or from the paper:

In our model this brazen behavior is a solution to an enforcement problem. The central idea is that less able criminals see lower gains from continued participation in crime because they will be caught and punished more often. Lower future gains imply that reputational concerns will be less effective at enforcing honesty. Only dealing with brazen criminals will become a good way to avoid dealing with incompetent criminals, because they cannot afford to mimic the brazen behavior. The principle is similar to the selection for a handicap in evolutionary biology.

Interesting stuff.  The authors more general research question involves actions that appear to increase the probability of detection for criminals.  With respect to the specific example of gang colors, my initial reaction is that I’m skeptical that this mechanism is the dominant explanation for gang colors given their widespread use among teenagers and others who are unlikely to be highly skilled criminals and other open and notorious displays gang members take to reduce the probability of detection (e.g., wearing masks to prevent identification, use of “community” guns that reduce police ability to attribute ownership to any individual member of the gang, etc.).  Instead, I suspect that open display of gang membership, e.g. through signaling membership, is a combination of signaling status and a commitment to bear the costs of actions taken by the rest of the gang which weeds out the non-loyal by forcing prospective members to get some “skin the game.”

Posted in economics, musings | 1 Comment »

 
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