To address a small issue in the history of economic thought, I wanted to consult a copy of the first edition of The Theory of Games and Economic Behavior, by John von Neumann and Oskar Morgenstern. I didn't find it reliably quoted on-line, nor did I find it listed in the on-line library catalogue for USD nor in that for UCSD. So I thought that perhaps I'd buy a copy.

I consulted the Used and Out-of-Print listings of AddAll, and quickly concluded that, no, perhaps I won't buy a copy. The lowest price that I found was four thousand, nine hundred and fifty-nine dollars, and twenty-nine cents.

I'm not sure who would pay that much, but the next lowest seller wants seven thousand, five hundred and ninety-one dollars, and ninety-three cents.

Another remarkable thing is the range of prices being asked for just that next seller. Through Biblio.com and through Biblio.co.uk, the price would be that $7591.93. From that same seller, but through Find-a-Book (listed by AddAll as ilabdatabase.com), the price would be $7614.96. And through AbeBooks (whom I encourage you to avoid in any case), the book would be $7867.54, still from that same seller. There's a $275.61 range here, determined by which intermediate service one uses.

Now, even as I was writing this entry, some of these prices were changing; that's because the seller is based in London, and the exchange rate has been in flux. And that suggests that part of the price range may be explained by different methods being used to calculate a rate of exchange. $275.61 may not seem a trivial sum, but it's only about 3.63% of $7591.93.

Addendum (2019:09/30): This morning I returned to the aforementioned small issue in the history of economic thought, and discovered that in the time since I posted this entry Google Books came to provide what they call a snippet view of a scan of the first edition, which view was enough to answer my question. I wish that I'd had that answer when writing my paper on indecision; but at least I have it as I write my paper synthesizing a theory of decision-making in which preörderings both for preferences and for probabilities may be incomplete.

In a previous entry, I discussed the meaning — or lack of meaning — of the word capitalism. With an eye towards future entries, I want to write now about the word socialism.

The OED (and the New SOED) provide the original definition of socialism:

A theory or policy of social organization which aims at or advocates the ownership and control of the means of production, capital, land, property, etc., by the community as a whole, and their administration or distribution in the interests of all.

It's pretty straight-forward: collective, communal ownership of the means of production, and administration for the collective benefit. But there's at least three points to be raised here. First, and most important, is that different conceptions of the community are possible. The community in question might be the whole world; it might be every human being within a particular jurisdiction; it might be a particular religious community; or it might be members of an ethnic group of some sort. Second, the definition here does not intrinsically entail comprehensive communal ownership; that is to say that it doesn't declare that all means of production must be communally owned for a system to be socialistic. Third, those who indeed advocate a comprehensive communal ownership of the means of production often fail to note that labor is an important means of production, so that such ownership would mean that an individual must work when, where, and how the community or its representatives told him or her to work.

Merriam-Webster gives us set of definitions, each somewhat different from that original definition:

1: any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods
2 a: a system of society or group living in which there is no private property b: a system or condition of society in which the means of production are owned and controlled by the state
3: a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done

The first three M-W definitions here (1, 2a, and 2b) all ignore the issue of for whose benefit the means of production are employed. Definition 1 is additionally broader than the original, in that it includes state ownership as possiby different from collective ownership. Definitions 2a and 2b are each otherwise narrower, as one precludes any private property, and the other insists upon state ownership. The final definition is introduced because Marxism, an important school of thought, made peculiar use of the term. Jointly, this set of definitions illustrate how a word can lose usefulness when popular use is uncritically accepted.

My 1975 copy of the AHD defines socialism as

1. A social system in which the producers possess both political power and the means of producing and distributing goods. 2. The theory or practice of those who support such a social system. 3. In Marxist-Leninist theory, the building, under dictatorship of the proletariat, of the material base for communism.

In the case of the first definition, one might begin by asking why the system should be called socialism; there is no mention of society or of community here, except in-so-far as this is a social order (as would be many in which producers would not have ownership or political power). Even if we regard the relevant community as that of the producers, the definition says nothing of them owning qua community; all property could be private, so long as the producers had means of production and distribution! Frankly, the author was so swept-up in his or her theory of socialism (recall the definition of capitalism that appears in the same edition) that he or she lost sight of its essential structure. (And perhaps the author was too enraptured to note that different folk would have different ideas about whom one should take to be a producer.) The second definition is purely derivative of the first. The third definition pushes-aside Marxism more generally in favor of Marxist-Leninism in particular, but is roughly a reïteration of the same notion, for about the same reason.

The 1993 version of the AHD defines it thus

1.a. A social system in which the means of producing and distributing goods are owned collectively and political power is exercised by the whole community. b. The theory or practice of those who support such a social system. 2. The building of the material base for communism under the dictatorship of the proletariat in Marxist-Leninist theory.

The first definition here has nearly restored the original sense: collective, communal ownership of the means of production, and administration for the collective benefit. (The three points that I raised in response remain germane.) But now there's an insistence that political power is exercised by the whole community. This is a response to the great embarrassment of decidedly undemocratic regimes claiming to represent the community in the administration of the means of production. (The reference to political power in the earlier edition was probably an ineffectual attempt to deal with that embarrassment.) The second definition is again purely derivative of the first. The third that from the earlier edition, with a non-substantive reördering of words.

All right now. When someone else has introduced the word socialism into the discourse, I've tried to respond to it based upon how that someone else is or at least seems to be using it, Or I've explicitly asked what he or she means by it; but when I've introduced or will introduce the word socialism into the discourse, what I've meant is

collective, communal ownership of the means of production and administration for the collective benefit

And I do plan to be writing again about socialism, very soon.

In a foot-note to a previous entry, I mentioned that, when people use the word capitalism, I want a definition.

The word capitalism, when first introduced, meant a condition of possessing capital, and the coördinate term capitalist identified one who possesses capital.

At some point, a new definition for the former was introduced. The word capitalism was used derogatorially, for a system that favors capitalists. The reason that this definition doesn't much work except for disparagement is that, under any system that has capital, there are capitalists (possessors of capital). For example, a system that declares a present or former proletariat to be the rightful owners (collectively or otherwise) of the means of production has declared them to be the rightful capitalists, and would favor their interests.

(At some further point, capitalist acquired the additional meaning of one who favors capitalism. But, if we replace the definition of capitalist within capitalism to use this later meaning, then we just have an idiotic loop-de-loop, within which capitalism is defined as a system that favors the interests of those who favor the system, which definition wouldn't do much to exclude all sorts of systems.)

In the OED, one finds basically the original two definitions of capitalism:

The condition of possessing capital; the position of a capitalist; a system which favours the existence of capitalists.

But my copy of the New SOED (1993) instead defines the term thus:

The possession of capital or wealth; a system in which private capital or wealth is used in the production or distribution of goods; the dominance of private owners of capital and of production for profit.

It's a bit troublesome to find the historically second definition seemingly shoved-down a memory hole;[1] but, in any case, one now finds two new definitions, one in terms of how capital is used, the second in terms of some sort of dominance by private capitalists, and of production for profit.[2] (That definition in terms of dominance might actually be an attempt to capture the sense of the historically second definition.)

Meanwhile, though, Merriam-Webster had its own thoughts on the subject. They define capitalism as

an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market

Well, it's probably worth noting that free market is a bit of a redundancy, in that, to the extent that prices or quantities are bounded by law, one isn't really talking about a market. But, in any case, the main thing to note is that this definition differs markèdly from the previous definitions, as corporate as well as private[3] ownership is allowed, and as a reliance upon markets has been introduced into the definition.

My 1975 copy of the AHD gives a remarkable definition:

1. An economic system characterized by freedom of the market with increasing concentration of private and corporate ownership of production and distribution means, proportionate to increasing accumulation and reinvestment of profits. 2. A political or social system regarded as being based on this.

That's kind-of like the Merriam-Webster definition, but with a theory of increasing concentration grafted onto it; and, not only increasing concentration, but proportionate increase. Huh. So, in other words, capitalism, at least under the definition labelled 1., refers to a system that not only has never existed, but couldn't ever exist; 'cause, as I guarantee you, economic processes don't typically follow nice lineär laws (nor simple arithmetic functions more generally). And one wonders what one is supposed to call a system in which there is a market, but not increasing concentration of wealth, or at least one in which wealth is not increased proportionately. Really, of course, what's going on with this definition is some attempt to impose a theory and to advance a social prescription.

But wait! My 1993 copy of the AHD tells us something else! It defines capitalism thus:

An economic system in which the means of production and distribution are privately or corporately owned and development is proportionate to the accumulation and reinvestment of profits gained in a free market.

Uhh… it's more of that proportionality stuff; another system that never has and never could exist. But, now, instead of investment increasing concentration of ownership, it's producing growth. Another attempt to grind an ideological axe, just a different axe. (I guess that versions of the AHD are kind-of like versions of Wikipedia, except that the changes are effected more slowly.)

Okay, so that's — what? three? five? — very standard sources, and how many definitions? And what is one to think when someone uses the term state capitalism, and defines it to mean an economy controlled by the state in a capitalist manner?

I once responded to an essay by asking the author what he meant by capitalism. His reply was that he'd used it with the standard definition. Well, there is no standard definition.[4] As far as I'm concerned, the word capitalism is practically useless, unless what one wants to practice is confusion, or unless one defines it before or immediately after first using it.

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[1] The SOED is supposed to be complete for terms and definitions found after 1700.

[2] An unclarified notion of profit appears here; there's no point in doing anything under any system, unless it actually improves things somehow; one suspects that the author has some narrower notion in mind.

[3] Some people loosely use the term corporation to refer simply to an association of some sort, but that would be just another sort of private ownership; legal corporations, on the other hand, are creatures of the state. They can be formed by license to a single person, rather than to an association. Corporations are treated by law largely as themselves persons. And they insulate those to whom they are licensed from liability, not merely to those with whom they contract (to whom liability could anyway have been limited by overt contractual terms) but to third parties who may be injured by the actions of the corporation.

[4] I cited some of these dictionary entries to make that point to him, and reïterated my question; he lapsed into silence.

One or more persons have wandered to this 'blog searching with

openoffice weak preference symbol

which touches on the font-fallback problem that I mentioned in my previous entry.

The symbols that one would typically encounter or want to use when talking about preference are

[Up-Date (2011:04/05): I have since uploaded a more complete table, including symbols, Unicode values, and LAΤΕΧ code, in the form of a PDF file.]

Now, it used to be that, when running OpenOffice under Red Hat Enterprise Linux, I had no problem using the symbols of my choice from amongst those on the table above. But when I up-dated to RHEL 6.0, the OpenOffice formula editor stopped properly rendering any of the above except ∼.[3]

For the formulæ that I'd previously entered, I'd specified a font either of Times New Roman or of Liberation Serif. The files for neither of these fonts actually contain the symbols above, but OpenOffice and RHEL are supposed to coöperate to effect font-fallback, and draw the characters from the files for some similar font or fonts. The software had been doing this, but with the up-date to RHEL 6.0 it is not.

This isn't a particulary great problem for new formula; I would just need to change the configuration of the formula editor to use some font that has the desired symbols; one could even play specifically with the formula editor's catalog, so that just those symbols would be rendered with that font, and some preferred font could be used for everything else.

But one of the serious, long-standing deficiencies of the OpenOffice formula editor is that there isn't a way to globally change the settings for all formulæ which have already been entered into a document. I have literally hundreds of preëxisting formulæ, for each of which the editor would have to be individually reconfigured, to fix things within OpenOffice. Right now, my best option seems to be to export the relevant documents to ΤΕΧ or to LAΤΕΧ, and to proceed with a plain-text editor!

Red Hat has responded to my bug-report as if it were a request for enhancement; since they hadn't planned any near-term enhancements in the versions that they distribute of OpenOffice or of fontconfig (with which OpenOffice would handle font-fallback), they refuse to address the bug. OpenOffice.org, meanwhile, is aware that OpenOffice doesn't handle font-fallback properly, and aware that it ought to be possible to reconfigure the formula editor globally within a document, but had invested its hopes in the editor's using a specific font, OpenSymbol, to provide mathematical characters. That font doesn't have any of the characters above, except perhaps ∼.

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[1] The relation of weak preference is one of being either more desirable or equally desirable, rather than one of necessarily being just a little more desirable. On the assumption that preferences are a complete ordering, weak preference is equivalent to being not less desirable.

[2] This relation is one of being either less desirable or equally desirable, rather than one of necessarily being just a little less desirable. On the assumption that preferences are a complete ordering, this relation is equivalent to being not more desirable.

[3] I'd not been getting that by entering ∼, but by using the editor mark-up sim.

At 08:48 on 8 September 2009, I had resubmitted my paper on indecision to a journal after replacing acknowledgements with place-holders. (The paper was originally submitted on 3 September, with the acknowledgements in-place and with a note from me that one of their editors was mentioned thereïn. The journal tossed it back to me to scrub the acknowledgments.)

To-day, then, at 08:48, we passed Day 500 since the (re)submission of the paper. Day 500, and the present status is Under review, which became its official status on 15 November of last year. (I earlier labored its previous status changes.) Doubtless that someone is thinking that they've only had the paper for 67 days, but the journal itself has had it for 500 days.

I am aware — Would that there were a G_d to help us all! — that 500 days is not a record for such delay. Still, economics journals which report their mean time-to-decision typically declare it to be something on the order of a month.

The temptation of Daylight-Savings Time is easy to explain. If one times the activities that need light to occur as little as possible during times when light would have to be artificially generated, then one saves resources. As one moves away from the Winter Solstice, the time between sunrise and sunset lengthens, and the amount of natural light available in the mornings increases. We used time zones so that clocks are synchronized over reasonably large areas, rather than just long lines of longitude. And re-setting clocks is less failure-prone and otherwise cheaper than changing time-tables.

Unfortunately, Daylight-Savings Time doesn't really work. Worse, it kills people.

In the contiguous United States (the lower 48), the difference between the time of sunrise at the summer solstice and at the winter solstice is about two hours, and it's not as if the change takes place all at once. When an hour is added to the clocks, activities that were beginning at about sunrise are immediately beginning about an hour before sunrise; it takes more than a month for the seasonal change to catch-up to the clock change, and later in the year, as sunrise again has begun to take place later, there will be another month during which the seasonal difference is less than the clock difference. And the clocks through-out each time-zone, all the way to its western border, are typically being kept in synchronization with those on the eastern border; with time-zones being about an hour wide, activities that were taking place up to an hour after sunrise on the eastern border are taking place at or before sunrise elsewhere in the time zone. So we shouldn't be terribly shocked that statistically studies haven't been able to tease-out much-if-any actual savings associated with Daylight-Savings Time.

Meanwhile, it has been observed that, as the nation goes on or off Daylight-Savings Time, there is an increase in automobiles hitting pedestrians. That's because drivers adjust imperfectly to the apparent sudden change in how dark it is in the morning or in the evening. They are driving in the morning or in the evening as if it is lighter than it is, and the fact that they are driving as if it is darker than it is at the other end of the day doesn't offset the effects (because the marginal effect of caution is diminishing). When Daylight-Savings Time is begun, there an addition element of people being poorly rested; the effect is not much off-set by people being better rested when Standard Time is resumed.

The self-styled SD Planning Committee, formed to fight cuts to state funding of education, health care, and social services, has posted flyers that declare

We face not a financial crisis, but a crisis of priorities,

I don't know why they end that with a comma, as it's followed by a sentence in which it cannot participate. In any case, it's a somewhat puffed-up way of saying that

Interesting concept, there, that there could be plenty of money in a budget, but that the money is not being well spent. They just might try applying that same concept to just those portions of the budget that are allocated to education, to health care, and to social services. Perhaps, even after cuts, there would be plenty of money, if only it were spent well. And perhaps even if funding to these programmes were increased to the greatest possible levels, it would be spent badly.

Okay, so there's no perhaps to it; that's just how it would be.

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On the other hand, I have to grimace when I hear or read of linking teacher pay to performance.

I understand the desire to pay teachers based upon the quality of their teaching. And, outside of the teachers' unions, almost everyone understands that it's not a good thing to link teacher pay primarily (let alone directly) to years of service. But I'm pretty sure that real-world attempts to link teacher pay to ostensible measures of performance are going to increase

• disincentives for teachers to accept jobs working with less able students,
• incentives for teachers to teach to the tests by which student achievement is purportedly measured,
• student time tied-up in taking those d_mn'd tests, which themselves teach nothing to students beyond test-taking skills.

A profoundly different model of education is needed to get something that will work.

A part of that model would be to use markets to price teaching, recognizing (amongst other things) that different teaching contexts correspond to different markets.

Unfortunately, another part of that model is for parents to accept a significantly greater degree of responsibility for ensuring that their children are properly educated. The vast majority of parents seem willing to pass the buck to state-funded schools, regardless of their performance. It isn't sufficient to say Hey, I sent my kid to school! The school dropped the ball, not me!

During the years when I was wrestling with my paper on indecision, there was at least one paper published that attempts to operationalize incomplete preferences, Indifference or indecisiveness? Choice-theoretic foundations of incomplete preferences by Kfir Eliaz and Efe A. Ok in Games and Economic Behavior vol 56 (2006) 61–86. I didn't come across this paper until mine was essentially ready for submission, but I dropped-in a note distinguishing how they sought to operationalize indecision from how I did. What they did was interesting, but I'm distinctly uncomfortable with it.

They propose a scenario in which a Mrs. Watson is selecting one item to be shared by her two children. The children's preferences are thus:

which is to say that A prefers y to z and z to x, while T prefers x to y and y to z. The authors tell us that if y is available then the parent will not select z, as y is preferred to it by both children. Thus, if the choice were only between y and z, then y would be selected. However, should y not be available, and the parent forced to choose between x and z, then there is no clear choice between x and z. Yet if z is not available, there is also no clear choice between x and y. Thus, we have the oddness that y is preferred to z, neither x nor z is preferred to the other, and neither x nor y is preferred to the other. The authors associate this odd confluence with indecision amongst some of the choices. The parent resolves the choice over x and y or over x and z by flipping a coin. (The authors do not recognize coin-flipping as a third option, and what they say elsewhere implies that indifference would also be resolved thus.)

The authors write

It seems quite difficult to argue that there is something clearly wrong in the way Mrs. Watson deals with her two choice problems here.

What the parent has done here is implicitly embraced a sort of democratic process; she knows how the children would vote (if not voting strategically), and casts those votes on the behalf of each, settling ties with the flip of a coin. Well, it's well established that, in the absence of everyone having the same preferences, even if each participant is him- or herself rational, democratic processes don't produce rational choice structures. (For example, if some votes are decided before others, then the order in which things are decided determines the ultimate outcome.) In fact, it was famously shown (with Kenneth Arrow's Impossibility Theorem) that this isn't just a problem for ordinary democracy, but for any collective decision-making process. (I'm not here counting dictatorship as a collective decision-making process.)

So the parent's attempting to meet the desires of her two children is, in this case, formally equivalent to her attempting to meet the desires of one child who is just crazy. (Parents of multiple children will likely have little difficulty in grasping that point intuïtively.)

I'll make more plain the insanity specifically here. Under a decision-making process in which one would simply trade each unit of every x_n for a unit of x_n+1, by m-stage trades, one can be got to trade all of one's x₀ for x_m, even if one prefers x₀ to x_m. If whether each trade is effected depends upon the flip of a coin, then it might take more offers to get one to trade-away all of one's x₀ for x_m, but that's still where one can be led. (A patient exploiter could get one to surrender all of one's x₀ for x_m, and then monetize that by selling the x₀, with credit for trade-in of the x_m.)

The authors acknowledge that their scenario involves social choice theory, but assert that the problem can be generalized to other problems of choice with multiple criteria. However, the example that they give is one of an agent attempting to follow given rules (for awarding a fellowship); what we should see is that whatever rules might produce the same sort of structure are, again, loopy (in at least two senses of that word).

Now, in some case, perhaps in a great many cases, the sane chose to humor the insane; they even bend to the will of the lunatic; but the choice made in yielding to regulation by another is not, properly, the same choice as that of the regulator. Nor would I otherwise be comfortable with a model that could not find indecision except where one can find this sort of irrationality lurking in the background if not in the foreground.

Catching shill-bidders on eBay used to be one of my hobbies. I would regularly stumble-upon suspicious confluences, start examining auction and bidder histories, and from them often assemble proof that there had been shill-bidding, which proof I would then send to eBay and to the victims. I'm sure that I wasn't the only person engaging in this sort of detection.

But eBay began choking-off the data available to us. With decreasing information, it became ever harder to make the case. It became impossible even to see some of the confluences that would have triggered suspicion in the first place.

For an honest auction firm, there may be an optimal amount of shill-bidding to allow, simply because of enforcement costs. (A perfectly secure trading environment would be prohibitively expensive.) But for a dishonest firm the question is of balancing the gain that otherwise comes from allowing ending prices (and hence fees) to be thus increased, against the alienation of users who consequently reduce their spending. Access to information which both empowers volunteers to catch shill-bidders and alerts users more generally to the occurrence of shill-bidding is, as such, not in the perceived interest of a dishonest firm.

BTW, the changes that reduced our abilities to spot shill-bidders, and which made it more typically impossible for us to prove a case of shill-bidding (as well as other changes that enabled eBay to be more easily used by thieves) were primarily effected while Margaret Cushing (Meg) Whitman, now the Republican Party nominee for governor of California, was eBay's President and CEO.

The Confederate States of America went into debt to finance their war of secession. After the war some of their creditors wanted that debt repaid. The United States, on the other hand didn't want them to recover any of their investment, for the obvious reasons. In response to the insistence that this debt not be paid, sympathizers of the Confederacy suggested that, likewise, the debt of the Union should not be paid, for the obvious reasons. Additionally, it was argued that the emancipation of slaves was a taking of private property, so that, under the Fifth Amendment, former slave-owners were owed just compensation.

The North reminded the South who was making the rules, and included the following as section 4 of the Fourteenth Amendment:

The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.

(Underscores mine.)

There's probably someone out there somewhere, even now, insisting that the debts of the Confederacy should be repaid, or that descendants of slave-holders are owed reparations, but those issues no longer have much currency, nor can they be expected to recover currency.

On the other hand, when addressing the debts of the United States, that Amendment included but did not limit itself to those debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion. What remain potentially relevant, then, are the underscored words:

The validity of the public debt of the United States, authorized by law, […] shall not be questioned.

The national debts of the United States cannot Constitutionally be repudiated, without further Amendment. Under the Constitution, they have to be serviced; and, when they come due, they have to be paid.

Present levels of deficit spending are widely seen as unsustainable, and the United States Treasury has begun to pay discernible risk premia, which is to say that a significant part of the market expects that the United States might default. So one question is of how a default might be effected.

In theory, an Amendment could quickly be ratified to permit default, though a significant share of the national debt remains domestically held, which would tend to brake the passage of such an Amendment. Of course, the beginning of the process of amendment would drastically erode confidence in the debt, so that the risk premia would grow dramatically, and the Treasury might find itself almost immediately unable to pay bills, and might remain unable to do so until the Amendment were ratified and restructuring negotiations were completed.

A more likely process would be a Declaration of Emergency, under which the Constitution were suspended, as the federal state worked-out what it could expropriate from whom. (The Constitution makes absolutely no provisions for such emergency suspensions, but we've had a long history of our rulers claiming the power to effect them,[1] and of courts doing little to check such actions.) Again, the United States might be unable to borrow money, but the process of partial repudiation could immediately be brought forward.

Or it might be that the debt were restructured without the consent of creditors. Such a restructuring would, in fact, be a partial repudiation, but lawyers and judges have long proved adept at making distinctions where there are no differences.

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[1] With one exception, during each war since the adoption of the Constitution, the President has suspended provisions of the Constitution. That one exception was Madison, who had been the principal author both of the Constitution and of the Bill of Rights.