Knowing and Making

I have just remembered to link to Turbulence Ahead , the blog of Gerard O'Neill, who spoke on a panel with me last year at the Geary Institute. His latest post has a nice quote from Sean Corrigan: "...prosperity cannot be forced, but must be built one exchange at a time as individuals further their own self-interest by catering to the interests of others..." Corrigan intends this as an argument for his Austrian, laissez-faire philosophy. And it does support that case. But when we think about it a little more deeply, it also illuminates a different view. The quote hints at, but perhaps underplays, the role of the entrepreneur. Presumably each consumer knows about a certain range of available goods, and they are already choosing whichever subset is best for them (I'd usually insert a critique about economic rationality here, but this time I'll leave that alone and make a different point). Given this starting point, in order to get economic growth we need one o...

The panel discussion at the Geary Institute was excellent. It was introduced by Liam Delaney who gave a 15-minute overview of behavioural economics, focused particularly around policy and commitment devices. As a good Dubliner, he used Ulysses as his example, tying himself to the mast to sail past the Sirens without losing himself to temptation. Liam pointed out that Ulysses tied his own body to the mast, without relying on the Greek government of the time to stop him getting into trouble. Nobody pointed out that in modern times, the need for self-discipline seems to be the other way around. This was followed by a few minutes each from Colm Harmon , Gerard O'Neill , Pete Lunn and me. Colm's focus is on policy and he suggested using the experimental techniques of behavioural economics to provide more accurate and interesting data. Gerard has a commercial view, as to some extent does Pete - though Pete's work is at ESRI, the Irish economic research institute, and he has...