Coase Colored Glasses


Archive for February 25th, 2011


Meta Post

I wasn’t sure if we needed to post it on here, but just in case anyone wants to read it..
I wasn’t sure how I would enjoyed blogging when it was mentioned in class. I enjoy writing, but I have a hard time doing under a deadline especially a deadline that reoccurs twice a week. In economic terms the incentives weren’t clear to me when I began. Sure getting a good grade may have been an incentive but I’ve discovered that there are other incentive to writing about economics, and you begin to see the fairly abstract ideas which are discussed in books or in class in your everyday life and then you have the desire to blog about it. It’s nearly addicting.
As I read through my own blog posts I noticed three distinct things about my writing, as well as some other insights such as the idea that I must really like pirates because any time the option is to write about them I will. Granted, this shouldn’t be surprising, who doesn’t want to think and write about pirates?
The first thing I noticed is that I like to take logic to an extreme. I once heard that if you take a simple idea and put it in an extreme situation you’ll be able to see the merits and flaws of that idea better. Apparently I must feel like this works because I did it over and over again. When writing about signals instead of talking about wearing a suit I imagined myself wearing a banana suit. Also when talking about signals I thought about taking my date to Wendys and ordering off the dollar menu as a low cost food option. While talking about adverse selection and dating I gave the hypothetical situation of a man marrying a pregnant women without knowing instead of picking some smaller and more typical adverse selection problem in dating. Over all I feel like this approach has worked as its helped me to see the logic in the arguments and observations that are being made.
The second thing I noticed was the fact that I write about myself and my life a lot. While it might not seem like it to the outside observer, I realized that whatever idea we’re discussing or reading is applied in my mind to something I’m actually dealing with. The ideas aren’t just theoretical or hypothetical to me. I discover patterns and cost and incentive relationships in my own life and then share those in different parts of my blog posts. Just by listing a few of the topics that I wrote about you can clearly see things that seem to be important parts of my life.  In fact a simple list of topics I blogged about reads like a laundry list of ‘topics that are important to or interest Blake’. Just some of them are Girls, Sports, Facebook, The Bible, and Politics.
On top of applying the economic ideas to different interests the third thing I have I noticed was that as I wrote and as I reflected upon my writing I took an interesting ownership of them. It wasn’t just incentives, it was MY incentives. Pirate flags weren’t just signals they were related to MY signals that I was sending out each day. It wasn’t just moral hazard that someone faced it was situations that I was involved in. I took an odd ownership of the idea.
As reviewed the different things that stuck out to me I found an interesting theme. Economics is ruining my life. I simply can’t think normally anymore. No longer am I just enjoying the sports I watch but now I’m analysing them, I’m wondering what the incentive was that drove people to make certain decisions. I wonder how I could increase my own incentives to do certain things or wonder about the cost that are associated with everything I do. Even now as I write about how economics is ruining my life I wonder what my incentives are for saying that. Is it just the little feeling of happiness that I get from sharing? Perhaps my motivation is something even more deep and calculated.
Overall I’m reminded again and again at how rational people, including me, are with their decision making. I’m also amazed at how quickly and almost subconsciously we calculate the costs and incentives of any choice or activity, and how quickly we make strategies based on our assumed understanding of how other will react to certain incentives or costs. We think in economic terms almost naturally, we just don’t know it.
That is until someone gives the thought processes names, then we can’t escape it.


Yet Another Meta Post

I wasn’t sure if we’re supposed to post this here or not, but no harm in joining in. I have to admit that going back through my posts has been an interesting experience. The first few posts seem more tentative than the last bunch. It seems I’m either getting more comfortable with economics, I’m finding more things to take issue with, or I’ve achieved a mixture of both. I tend to write more when critical of the readings for the week. That can be considered both good and bad, but I like my later posts better. Hopefully others do too. I do need to start making those long posts a bit more concise, and be sure to read over them a few times to check for word misspellings (like “form” and “from”). The blog posts are a great incentive to do the readings for class, and I really like how it gives me a chance to think through all the readings before class. I tend to understand complex ideas better once I’ve had a chance to sleep on them, and it’s a lot easier to think through it in a blog post the night before instead of being put on the spot in front of the class.

I would like to revisit the Coase Theorem at some point (which I’m fairly sure we will in some way), because I’m not entirely sure I understand it as well as I should. I was a bit surprised to see how much I do understand. My primary major is Public Relations, and I never thought I’d be as economically minded as I am now. We started discussing finances in my Writing for PR class one day, and I found myself starting to think about it in terms of what we’ve discussed economically. I’ve learned so much in just a month and a half, and I greatly look forward to finishing out the semester.