Wikipedia: Another answer to the tragedy of the commons

The tragedy of the commons is an oft-cited theoretical example by those who advocate government intervention. It postulates that, without regulation and intervention, public goods that everyone has an interest in using will actually not be provided (or at least not efficiently or to an optimal quantity) if contributions are voluntary. The logic is that everyone’s dominant course of action is to essentially just refrain from contributing because, if one contributes and others don’t, then the public good is not provided and their payoff is worse than if they don’t contribute and the public good is not provided. Additionally, if they don’t contribute and the public good is provided, the individual’s payoff is higher than if they do contribute and the public good is provided. In this sense, a society full of rational, self-interested individuals (as this scenario represents it) could actually lead to a harmful or sub-optimal outcome for society in the long run.

However, Wikipedia is a prominent, empirical illustration of how the tragedy of the commons does not always hold since the website runs purely on private donations. Periodically, the site’s owners ask for donations to maintain it and keep it running ad-free. They claim that if everyone who read their plea paid £3, then fundraising would be over within an hour – nice in principle but not everyone pays up in practice. Some, inevitably, end up contributing more than others and many don’t contribute monetarily at all.

The following chart lists the percentage of donators corresponding to each reason for donating to Wikipedia, according to Wikipedia.

Wikipedia1

Conversely, here are the reasons cited for not donating:

Wikipedia2

Of course, one might argue that the knowledge found on Wikipedia is unreliable. However, a study published in Nature found that Wikipedia “is about as accurate on science as the Encyclopaedia Britannica”. Of course, Encyclopaedia Britannica attempted to refute the study. Access to a vast store of monitored, reviewed information via Wikipedia is an incredible asset to humanity and this asset is made possible entirely through voluntary contributions (whether this be in terms of time spent editing or money contributed) rather than through the coercive dictates that people are so often subject to.

Furthermore, it’s interesting to note that if you were to, hypothetically, replace “donating to Wikipedia” with “tax” in the second bar chart, you might find a lot of people agreeing with the affordability, with unwillingness to pay tax based on principle or their belief that it would not be used properly. Similarly, people may want to contribute time to society rather than pay money to preserve it.

In our rapidly changing world, voluntary contributions to fund public goods may become feasible sooner rather than later.

Sometimes men and women want different things

Sometimes men and women want different things. Their actions in labour markets are one example of this. That’s OK, even if it results from socially constructed gender roles, so long as it leads to good lives for both genders. One recent example of where this might be the case comes in a new paper studying the mathematically gifted. (Hat tip to Stephen Hsu).

Two cohorts of intellectually talented 13-year-olds were identified in the 1970s (1972–1974 and 1976–1978) as being in the top 1% of mathematical reasoning ability (1,037 males, 613 females). About four decades later, data on their careers, accomplishments, psychological well-being, families, and life preferences and priorities were collected.

Their accomplishments far exceeded base-rate expectations: Across the two cohorts, 4.1% had earned tenure at a major research university, 2.3% were top executives at “name brand” or Fortune 500 companies, and 2.4% were attorneys at major firms or organizations; participants had published 85 books and 7,572 refereed articles, secured 681 patents, and amassed $358 million in grants.

For both males and females, mathematical precocity early in life predicts later creative contributions and leadership in critical occupational roles. On average, males had incomes much greater than their spouses’, whereas females had incomes slightly lower than their spouses’. Salient sex differences that paralleled the differential career outcomes of the male and female participants were found in lifestyle preferences and priorities and in time allocation.

Men and women differed widely on a large number of metrics. Particularly, men, much more than women wanted high pay, risk taking, merit-based compensation and, work involving physical objects. On the other hand the top three things women valued more than men were, in order: working no more than 40 hours a week, working no more than 50 hours a week, and working no more than 60 hours a week.

It’s OK for people to have different preferences, and it’s OK for those preferences to differ not just within groups but across groups. That’s because satisfying people’s job preferences is what gives them general satisfaction and happiness with their job (shock! horror!) Some people may want men and women to be more alike, and that’s fine, but we should do this keeping in mind the costs that may impose on both groups.

Screen Shot 2014-11-27 at 11.57.26

Markets make us better people

One of the most common objections to market-based societies is that they erode non-market motivations to doing good. Critics, with this objection, say that although markets can in some areas latch onto greed and turn it to society’s benefit in some areas (“It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect our dinner, but from their regard to their own interest”) they can also pervert and corrupt existing motivations in domains where markets are inappropriate.

Consider blood donations: many argue that if you start paying for blood donations then people will stop seeing them as a good deed but as a market activity, and lose their ‘intrinsic motivation’ to give blood. Overall you might get less blood, or less good blood than before, even though you’re now spending money to get it.Back in 2012, Harvard communitarian political philosopher Michael Sandel (famous for his online lectures), wrote a hugely popular book What Money Can’t Buy: The Moral Limits of Markets making roughly these arguments (read a wonderful review here).

These questions are discussed widely, but what’s weird is they tend to be tackled mainly with a priori thought experiment arguments like mine about blood, above, and anecdotes, even though they are empirical questions. We can actually test whether you get less or worse blood when you pay for it! (You don’t) We can test whether people are less pro-social when you add extra market institutions!

A new paper by Björn Bartling, Roberto Weber and Lan Yao, “Do Markets Erode Social Responsibility?”, in the Quarterly Journal of Economics tries to do as much:

This paper studies whether concerns for social responsibility persist in repeated market interaction. We develop a laboratory product market, in which socially responsible behavior by firms and consumers involves incurring additional production costs to mitigate potential negative externalities imposed on individuals otherwise uninvolved with the market.

The data from Study 1, conducted in Switzerland, show, first, that there is a non-trivial share of socially responsible products supplied and demanded in all our market conditions, and that—importantly—the market share of the fair product is stable over time in all conditions.

Second, the socially responsible product, which costs more to produce, sells at a price premium that persists with market experience. In most cases, this price premium increases over time, suggesting that consumers’ willingness to pay for socially responsible products is not eliminated with repeated market interaction. Third, we show that individual-level market behavior is consistent with a preference for positive social impact, though such concerns are heterogeneous.

In other words: markets do not erode existing pro-social motivation; they complement it.

Objectivism and modern society

Ayn Rand’s Atlas Shrugged is polled to be the second most influential book in Americans’ lives, coming in second only to the Bible. Whether this statistic is skewed or not, there is no doubt that Rand’s longest work has had a lasting impact on the hearts and minds of its readers since its publication in 1957. It may be too soon to know if it stands the test of time, but it has certainly persevered with power and passion.

It’s hard to understand how Atlas Shrugged has remained so popular while the views of its author remain so controversial. Forget the left-wing masses—many self-proclaimed libertarians avoid being associated with her last name. In most circles (even sympathetic ones), the Randian badge is not worn openly.

Furthermore, she is consistently attacked by critics who paint her philosophy of objectivism as radical, rudely selfish and dangerous to modern society. When most people today—even on the right—recognise the need for some form of welfare or safety net, how can one include Rand’s voice in modern discourse?

At the ASI’s annual Ayn Rand Lecture on Monday night, guest speaker David Sokol addressed an audience of almost 300 attendees and reminded all of them why Atlas Shrugged transcends the criticisms and attacks on objectivism.

Unlike most philosophers and economists, Rand was able to connect philosophy and fiction in a way that inspired people to observe and revere the power of individualism. As Sokol pointed out, the right to have hope for yourself and whatever you choose to build is going to win against any promise a government can make.

Even in the 1950’s, Rand could see what direction governments was heading—that entrapments were disguised as promises, as governments increasingly encroached on individual’s rights and property:

(Bureaucrat) Floyd Ferris:”You honest men are such a problem and such a headache. But we knew you’d slip sooner or later . . . [and break one of our regulations] . . . this is just what we wanted.”

Rearden: “You seem to be pleased about it.”

Ferris: “Don’t I have good reason to be?”

Rearden: “But, after all, I did break one of your laws.”

Ferris: Well, what do you think they’re there for?”

Ferris: “Did you really think that we want those laws to be observed? We want them broken.”

Today, some of the world’s most important leaders are looking to snare businesses, paint them as the enemy, and project the idea that the state is responsible for the success of business, job growth, and any individual achievement. It’s an uncomfortable and deeply flawed narrative—and fortunately, not a particularly successful one. Regardless of bureaucratic narrative, Atlas Shrugged continues to inspire individuals in a way that collectivist approaches can’t come close to; as such, Rand and her philosophy have secured their place in modern society.

To see photos of the ASI’s Ayn Rand Lecture, click here.

David Cameron vs feminism

Today there was a minor kerfuffle about the Prime Minister’s refusal to wear a t-shirt that says “This is what a feminist looks like” after Elle, a women’s magazine, asked him to do so for a marketing campaign. Elle had a go at Cameron, saying that “It should be simple. Do you believe that men and women are equal? Do you believe men and women should have the same rights? The same opportunities? Yes? Then you are a feminist.”

Well, that sounds pretty reasonable! I don’t see how anyone could object to that. But the plot thickens later on. All these unobjectionable, bland claims apparently relate to quite specific public policy issues, like unequal pay and political representation for women. According to Elle, we need feminism because “for every £1 a man earns in the UK, a woman earns 80p. Women make up only 35% of senior managers in the UK and an estimated 30,000 women a year lose their jobs as a result of pregnancy-related discrimination. In politics, fewer than one in four MPs is a woman, and there are only five women in the cabinet out of 22 ministers”.

In other words, we need feminism so we can do something about very specific issues (presumably in specific ways, since the Fawcett Society is involved which has specific policies to address all these things).

This sounds to me like a ‘motte and bailey’ argument. Scott Alexander explains in more detail in part two of this excellent essay here (if you have the time, read that, not this). The name come from medieval times, when a ‘motte’ was a defensible castle surrounded by a profitable village called the ‘bailey’. Everyone would work out in the bailey until they got attacked and had to retreat to the safety of the motte.

A motte and bailey argument starts off by defining itself in very defensible way. “Feminism means thinking that men and women should be treated equally.” That’s the safe, defensible motte.

It then extends that reasonable-seeming claim to all sorts of controversial claims – unequal political representation demands all-women shortlists; unequal pay demands more invasive laws to equalise pay between men and women. That’s the bailey where the actual (political or cultural) advancements can be made.

Let’s say you attack the bailey by saying that you’re not a feminist because you think the policies advocated by feminists are bad, or the problems they identify are not even problems at all. Maybe you find, as Ben recently has, that “if you control for background (i.e. skills and talent) and exit (i.e. women staying in the workforce) women earn more than men and get more aggressively promoted than men”, which implies that the claims made by feminists about unequal pay needing new laws are simply incorrect.

Feminism may also be wrong about many other things, such as claims about men and women’s brains being biologically the same or the pervasiveness of a ‘rape culture’. These are substantive elements of what feminists define as feminism, and they may be right or wrong. It’s legitimate (albeit quite possibly mistaken) to think these claims are wrong, and hence to decline to wear a ‘This is what a feminist looks like’ t-shirt.

But do that and many feminists will retreat into the defensible motte, as Elle have today. David Cameron doesn’t think men and women should be equal! David Cameron doesn’t think men and women should have the same rights! Feminism is very simple!

This is dishonest and manipulative. And an open society requires honesty in political discourse. David Cameron is often accused of pandering to fashion. He deserves credit for refusing to do so this time.