Thursday, September 20, 2012

The Sabbath (Book Review)

The Sabbath by Abraham Heschel tip-toes the line of soul and mind. The dream-like prose is packed with zeal for a day he calls, "a palace in time":
The seventh day is a mine where spirit's precious metal can be found with which to construct a palace in time, a dimension in which the human is at home with the divine; a dimension in which man aspires to approach the likeness of the divine. For where shall the likeness of God be found? There is no quality that space has in common with the essence of God. There is not enough freedom at the top of the mountain; there is not enough glory in the silence of the sea. Yet the likeness of God can be found in time, which is eternity in disguise.
According to Heschel there are two divisions of the world: space and time. We are well acquainted with space, creating and toiling, but, we are less familiar with time. First, we start with space. Our endeavors in space can help us understand God as Creator. For example, I built Adirondack chairs the other week, therefore, I created on a much smaller scale. Furthermore, I can tell you, there is satisfaction in the toil and I feel a connection to the chairs built. In this sense, with this small metaphor I gain insight into God. Yet, as Heschel points out the likeness of God is too grand to be captured in an object.

What Heschel spends much more pages writing about is time. Writing about the nature of time Heschel looks to the Bible and ancient rabbis. Genesis 2:2 reads, "On the seventh day God finished his work," Exodus 20:11 reads, "In six days the Lord made the heaven and earth." Wait a minute . . . He made the heaven and the earth in 6 days but finished on the 7th? The rabbi's resolved this by stating that menuha was created on the Sabbath. Menuha is not an object like my Adirondack chair that can be grasped, rather, Heschel states menuha means something akin to "tranquility, serenity, peace, and repose". God created an architecture in time and menuha is the special attribute of the seventh day.

The fact that God blessed the seventh day, and not the other days, should hint that the seventh day is special. What this means is that time is not homogeneous ---some time is different than other time. What I take this to mean is, there is time for creating and time for remembering that we were created. On the seventh day we remember our relationship with God, that remembrance is a refuge from a fury of sound and distraction. What is more, this remembrance carries us through the rest of the week.

Heschel regales the reader with stories of Jewish people practicing the Sabbath and embracing the day with vigor and longing. There are many stories that could be presented here, but, I will share only one,
Rabbi Solomon of Radomsk once arrived in a certain town, where, he was told, lived an old woman who had known the famous Rabbi Elimelech. She was too old go out, so he went to see her and asked her to tell him what she knew about the great Master. ---I do not know what went on in his room, because I worked as one of the maids in the kitchen of his house. Only one thing I can tell you. During the week the maids would often quarrel with one another, as is common. But, week after week, on Friday when the Sabbath was about to arrive, the spirit of the kitchen was like the spirit on the eve of the Day of Atonement. Everybody would be overcome with an urge to ask forgiveness of each other. We were all seized by a feeling of affection and inner peace.
This book gave me a passion and appreciation for the Sabbath that I did not have before reading this book. Heschel (below) at one point asks, ". . . is there any institution which holds out greater hope for man's progress than the Sabbath?"

This is a great question. Given the level of pressure and stress, which negatively impacts many people's lives, it would seem we need to learn the discipline of rest. Not merely diversion but a palace in time that anchors our identity as image bearers of God.

Saturday, September 15, 2012

Symbiotics, I mean, Economics

Earlier this week a package arrived. It was heavy like a box of rocks but contained about twelve books and a large packet of reading material. The Mercatus Center holds its first meeting for the Adam Smith fellows in mid-October and there is quite a bit of material to digest before we meet. So, I thought the blog would be an opportunity to (A) Pass along what I am learning, and (B) Serve as a repository so I don't forget what I'm learning.

This post will be a brief discussion of the first two articles in the packet Lord Lionel Robbins on "The Significance of Economic Science" circa 1935 and a later 1964 vintage by Nobel-Laureate James Buchanan called "What Should Economists Do?". In historical context both of these articles have important messages about economic method that are still relevant for modern discourse.

Robbins' central point was that economics is incapable of conducting interpersonal comparisons of utility. Other scholars at the time were using the law of diminishing marginal utility as justification for the redistribution of wealth. While Robbins upheld the belief that we could measure marginal changes for an individual he eschewed the notion that we could compare between individuals.

For example, at the extreme, there are two brothers, one named Rich N. Come and the other named Noel N. Come. Robbin's contemporaries said that Rich received less satisfaction from $1 more money than Noel received from that same dollar. Thus, the government could transfer wealth from Rich to Noel because that would result in higher social utility. However, Robbins' main point is that this justification relies on knowledge of the magnitudes of utility. In fact, there is no science that can accurately obtain such magnitudes.  Side Question: Does the literature on happiness and advances in neuroeconomics hold out hope for measuring such things? (To be discussed later)

Additionally, Robbins attempted to make a sharp distinction between (1) The objective function and (2) The economical way in which that objective is obtained. As economists Robbins said we have no way of knowing what is the best objective: more equal distribution of wealth, more meritorious distribution of wealth, etc. But, given a particular objective we should be able to talk about the lowest cost way to achieve that goal. He writes, "Without economic analysis it is not possible to rationally choose between alternative systems of society".

Buchanan uses Robbins' arguments to discuss how economists have been obsessed with the allocation of scarce resources among competing ends. Briefly, he discusses how his contemporaries got around Robbins' problem of interpersonal utility comparisons. These people created mathematical constructions called "social welfare functions" to arrive at aggregate levels of utility. While Buchanan understands the reason economists have focused on allocation he endeavors to suggest that economists would gain greater insight about human nature through studying the process of exchange ---not outcomes alone.

One passage I found particularly interesting, and summarizes his thoughts nicely, was his discussion about the name "economics". Buchanan writes, 
"Were it possible to wipe the slate clean [change the name economics to something else], I should recommend . . . "symbiotics" . . . Symbiotics is defined as the study of association between dissimilar organisms, and the connotation of the term is that the association is mutually beneficial to all parties. This conveys more or less precisely the idea that should be central to our discipline. It draws attention to a unique sort of relationship that which involves the cooperative association of individuals, one with another, even when the individual interests are different."
In 1964 Buchanan made arguments that our focus on outcomes was leading us to become a backyard of mathematics. However, when we focused on the process we learned something useful. How are human actors considering costs and benefits? What social or legal rules are salient in their decision-making process? What social or legal rules will people invent to overcome problems? For example, Buchanan said that the free-rider problem in public goods provision could be overcome through the creation of a constitution that had coercive power. He thought this was an economic action where at least a subset of people were able to pen a mutually beneficial agreement. This was symbiotics. 

Since Buchanan wrote this article there has been some progress towards becoming a process-oriented rather than allocation-oriented science. I will expound on this in a future post.  The question I'm asking myself now is, "Why did the Mercatus Center want us to read these?" I think that the overall goal is to get us to think about the market as an emergent process rather than something that is "in equilibrium". Such a framework for thought would put emphasis on institutions as well as entrepreneurial action (either new products or via collective action). In essence, focus on the process puts humans, not allocations, at the center of economics. I think this will prove to be a useful window through which we can look at the world.

This is not esoteric economics but matters in the following sense. If we are a science that focuses on outcomes without much regard for the process in which outcomes happen we will be less attuned to opportunity costs and unintended consequences, two things we profess to teach our students (and on this blog we have professed could help make the world a better place). More to come.