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		<title>Great quotes</title>
		<link>http://darfferrara.wordpress.com/2011/12/26/great-quotes/</link>
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		<pubDate>Mon, 26 Dec 2011 23:41:05 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
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		<description><![CDATA[“The best books&#8230; are those that tell you what you know already.” ― George Orwell, 1984 Orwell knew about confirmation bias. That&#8217;s why it&#8217;s important to follow the golden rule, as stated by Darwin “I had also, during many years, followed a golden rule, namely that whenever published fact, a new observation of thought came [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=283&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p>“The best books&#8230; are those that tell you what you know already.”<br />
― George Orwell, 1984</p>
<p>Orwell knew about <a href="http://en.wikipedia.org/wiki/Confirmation_bias">confirmation bias</a>. That&#8217;s why it&#8217;s important to follow the golden rule, as stated by Darwin</p>
<p>“I had also, during many years, followed a golden rule, namely that whenever published fact, a new observation of thought came across me, which was opposed to my general results, to make a memorandum of it without fail and at once; for I had found by experience that such facts and thoughts were far more apt to escape from the memory than favourable ones.”</p>
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		<title>It&#8217;s a Brave New World</title>
		<link>http://darfferrara.wordpress.com/2011/10/16/its-a-brave-new-world/</link>
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		<pubDate>Sun, 16 Oct 2011 14:25:25 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
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		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=280</guid>
		<description><![CDATA[Lenina shook her head. &#8220;Somehow,&#8221; she mused, &#8220;I hadn&#8217;t been feeling very keen on promiscuity lately. There are times when one doesn&#8217;t. Haven&#8217;t you found that too, Fanny?&#8221; Fanny nodded her sympathy and understanding. &#8220;But one&#8217;s got to make the effort,&#8221; she said, sententiously, &#8220;one&#8217;s got to play the game. After all, every one belongs [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=280&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><span style="font-family:verdana;"><span style="font-family:verdana;">Lenina shook her head. &#8220;Somehow,&#8221; she mused, &#8220;I hadn&#8217;t been feeling very keen on promiscuity lately. There are times when one doesn&#8217;t. Haven&#8217;t you found that too, Fanny?&#8221;</span></span></p>
<p><span style="font-family:verdana;"><span style="font-family:verdana;">Fanny nodded her sympathy and understanding. &#8220;But one&#8217;s got to make the effort,&#8221; she said, sententiously, &#8220;one&#8217;s got to play the game. After all, every one belongs to every one else.&#8221;</span></span></p>
<p><span style="font-family:verdana;"><span style="font-family:verdana;">&#8220;Yes, every one belongs to every one else,&#8221; Lenina repeated slowly and, sighing, was silent for a moment; then, taking Fanny&#8217;s hand, gave it a little squeeze. &#8220;You&#8217;re quite right, Fanny. As usual. I&#8217;ll make the effort.&#8221;</span></span><br />
Brave New World, Aldous Huxley</p>
<p>Reminds me of <a href="http://pajamasmedia.com/instapundit/128815/">this</a> as it relates to <a href="http://front.moveon.org/the-elizabeth-warren-quote-every-american-needs-to-see/">this</a>.</p>
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		<title>Murder, Magic and Medicine</title>
		<link>http://darfferrara.wordpress.com/2011/05/26/murder-magic-and-medicine/</link>
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		<pubDate>Thu, 26 May 2011 00:52:50 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
				<category><![CDATA[book review]]></category>

		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=256</guid>
		<description><![CDATA[Very good book by John Mann tracing the history of pharmaceuticals from pre-history to now, in all their various uses. I learned that Pope Leo XIII approved of cocaine usage, the potion that Juliet took was likely based on curare, and that most people that discovered these drugs are far more adventurous with their bodies [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=256&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://www.amazon.com/Murder-Magic-Medicine-John-Mann/dp/0198507445/ref=sr_1_1?ie=UTF8&amp;qid=1306370280&amp;sr=8-1">Very good book</a> by John Mann tracing the history of pharmaceuticals from pre-history to now, in all their various uses. I learned that Pope Leo XIII approved of cocaine usage, the potion that Juliet took was likely based on curare, and that most people that discovered these drugs are far more adventurous with their bodies than I would ever be. An economics puzzle: Why is the latest edition 50 times as expensive as the next most recent edition?</p>
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		<title>What Doesn&#8217;t Create Growth</title>
		<link>http://darfferrara.wordpress.com/2011/05/15/what-doesnt-create-growth/</link>
		<comments>http://darfferrara.wordpress.com/2011/05/15/what-doesnt-create-growth/#comments</comments>
		<pubDate>Sun, 15 May 2011 23:38:22 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
				<category><![CDATA[Uncategorized]]></category>

		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=246</guid>
		<description><![CDATA[Trade, technology, cheaper transportation, protestant work ethic, education, colonialism, geography, or division of labor. That isn&#8217;t quite true, these things can, and do, contribute to growth. But the facts indicate that none of them can explain the levels of growth that have taken place in the modern world since growth started. At least this is [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=246&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p>Trade, technology, cheaper transportation, protestant work ethic, education, colonialism, geography, or division of labor. That isn&#8217;t quite true, these things can, and do, contribute to growth. But the facts indicate that none of them can explain the levels of growth that have taken place in the modern world since growth started. At least this is the claim made by Deirdre McCloskey in her survey article in The Economic History of Britain since 1700, and her newest book, Bourgeois Dignity: Why Economics Can&#8217;t Explain the Modern World</p>
<p>For the first 49750 years or so, humankind had lived at subsistence levels. This translates into roughly 3 dollars a day. There were usually a few kings, pharaohs, and emperors who were richer than this, but for the most part people would live lives that were nasty, brutish and short. In Europe there was a measurable growth in the 9th and 10th centuries, that accompanied the use of horses to pull plows, but it wasn&#8217;t sustained. Then, around 250 years ago, something happened. It started in the Belgium, and then moved to Britain, where the growth between 1780 and 1860 was a full 100% moving toward 1100% around 1990.</p>
<p>All of the above reasons for growth have been given at some point or other. McCloskey knocks them down one by one. In order to dis-confirm some supposed reasons for growth Harberger&#8217;s Law is invoked. Harberger&#8217;s Law states that if one calculates the gain amounting to some fraction from a sector that amounts to again a fraction of the national economy one is in effect multiplying a fraction by a fraction. Suppose X per cent of gain comes from a sector with Y per cent of the national income. the resulting fraction, X times Y, is the gain from that section. And when this is calculated for any particular sector of the economy it is small compared to the growth of 1100% from 1780 to the present, or even the 100% from 1780 to 1860. For example, the calculation from foreign trade explains produces about 13% of the 100% . Advances in cotton might get another 7%, transportation improvements 2 or 3 %.</p>
<p>What about science? Well, no, since science generally  lagged technology. The steam engine was the impetus to studying thermodynamics, electricity wasn&#8217;t used commercially until the very late 19th century, chemistry made no contribution to the making of steel until the 20th century, the computer until the middle of the 20th. What about technology? The pace of invention from at least the 15th century through 1750 was at least at the same pace as it was at 1750. Watt had his steam engine ready to go in 1775, but if the Harberger&#8217;s rule is applied to the part of the economy affected by the steam engine, the result is minimal.</p>
<p>Some of the explanations are probably necessary conditions, but not sufficient for sustained growth, literacy and education, large enough population densities for specialization, and access to raw materials being particularly important. But these combinations had been present in other cultures in the past, and the growth never happened. McCloskey&#8217;s thesis is that merchants, innovators and business people came to be, for the first time in human history, not only tolerated but respected. And very importantly, the way that people <em>spoke </em>about market activity and about the bourgeoisie  reflected this change. To me, it is very convincing, but I recognize there are other possible sociological and psychological ways to explain what has happened in the last 250 years or so. But the usual reasons given for growth are, I think, conclusively proven wrong.</p>
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			<media:title type="html">darfferrara</media:title>
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		<title>Speculation Creates Value</title>
		<link>http://darfferrara.wordpress.com/2011/04/19/speculation-creates-value/</link>
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		<pubDate>Tue, 19 Apr 2011 00:03:23 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
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		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=242</guid>
		<description><![CDATA[This is a great example of how speculation creates value. Imagine how much value is created by Wall St speculators!<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=242&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://mises.org/daily/5210/The-Capitalist-in-the-Hat">This </a>is a great example of how speculation creates value. Imagine how much value is created by Wall St speculators!</p>
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		<title>Capitalism is Wrong?</title>
		<link>http://darfferrara.wordpress.com/2011/03/31/capitalism-is-wrong/</link>
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		<pubDate>Thu, 31 Mar 2011 18:23:59 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
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		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=240</guid>
		<description><![CDATA[The most cogent argument I&#8217;ve seen.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=240&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://www.theonion.com/articles/continued-existence-of-edible-arrangements-disprov,19856/">The most cogent argument I&#8217;ve seen.</a></p>
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			<media:title type="html">darfferrara</media:title>
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		<title>The Creation of the Paragraph</title>
		<link>http://darfferrara.wordpress.com/2011/03/26/the-creation-of-the-paragraph/</link>
		<comments>http://darfferrara.wordpress.com/2011/03/26/the-creation-of-the-paragraph/#comments</comments>
		<pubDate>Sat, 26 Mar 2011 00:40:58 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
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		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=228</guid>
		<description><![CDATA[The paragraph has only been around since about 1795, and the generally accepted rules for paragraphs have only been around since about 1865. That&#8217;s when Alexander Bain came up with six rules for building paragraphs. For example, each paragraph should have a topic sentence that summarizes the main idea of the paragraph. Bain&#8217;s six rules [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=228&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p>The paragraph has only been around since about 1795, and the generally accepted rules for paragraphs have only been around since about 1865. That&#8217;s when <a href="http://en.wikipedia.org/wiki/Alexander_Bain">Alexander Bain</a> came up with six rules for building paragraphs. For example, each paragraph should have a <a href="http://en.wikipedia.org/wiki/Topic_sentence">topic sentence</a> that summarizes the main idea of the paragraph. Bain&#8217;s <a href="http://patternbasedwriting.com/elementary_writing_success/paragraph-rules-elementary-and-middle-school/">six rules</a> were whittled down to three by successive generations of grammarians, but the general form remained. </p>
<p>But it turns out that the rules were wrong. More recently academics have analyzed writing samples and it turns out that, for example, only 10% of the paragraphs have topic sentences, and that is using a generous definition of topic sentence. Most good writing doesn&#8217;t follow the Bain rules. This might have been obvious if teachers had checked, yet these rules were believed for over 100 years.  </p>
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		<title>Name That Cognitive Bias</title>
		<link>http://darfferrara.wordpress.com/2011/03/12/name-that-cognitive-bias/</link>
		<comments>http://darfferrara.wordpress.com/2011/03/12/name-that-cognitive-bias/#comments</comments>
		<pubDate>Sat, 12 Mar 2011 03:01:18 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
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		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=222</guid>
		<description><![CDATA[Like most people of pronounced seniority he reads the obituary page with attention, and had a morning of quiet triumph last winter when two insurance shamans, a past president of the Actuarial Society of America and the vice-president of a major company, died on the same day aged sixty-two and fifty-four respectively. &#8220;I bet they [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=222&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<blockquote><p>Like most people of pronounced seniority he reads the obituary page with attention, and had a morning of quiet triumph last winter when two insurance shamans, a past president of the Actuarial Society of America and the vice-president of a major company, died on the same day aged sixty-two and fifty-four respectively. &#8220;I bet they avoided excitement, late hours, high blood pressure, tasty food and intoxicating liquors and had themselves periodically examined with stethoscopes, fluoroscopes, spectroscopes and high-powered lenses,&#8221; the Colonel said. &#8220;The result was inevitable and to be expected, the result of a morbid preoccupation. The anxious fielder drops the ball.&#8221;</p>
<p>I twitted him with the vigorous old age attained by Mrs. Ella Boole, past president of the Woman&#8217;s Christian Temperance Union, who recently passed on in their ninety-fourth year, but the Colonel had a ready explanation of her survival.</p>
<p>&#8220;She must have been a secret tippler,&#8221; he said.</p>
<p>&nbsp;</p>
<p>&nbsp;</p></blockquote>
<p>From <em>The Honest Rainmaker</em>. And, by the way, it&#8217;s confirmation bias. I&#8217;ve been running into this one everywhere.</p>
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			<media:title type="html">darfferrara</media:title>
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		<title>What&#8217;s wrong with GDP?</title>
		<link>http://darfferrara.wordpress.com/2011/03/08/whats-wrong-with-gdp/</link>
		<comments>http://darfferrara.wordpress.com/2011/03/08/whats-wrong-with-gdp/#comments</comments>
		<pubDate>Tue, 08 Mar 2011 21:03:53 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
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		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=220</guid>
		<description><![CDATA[Lots<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=220&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p><a href="http://www.economicsofinformation.com/2011/03/stagnation-or-mismeasurement.html">Lots</a></p>
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			<media:title type="html">darfferrara</media:title>
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		<title>Are Pensions Better Than 401k&#8217;s?</title>
		<link>http://darfferrara.wordpress.com/2011/03/02/are-pensions-better-than-401ks/</link>
		<comments>http://darfferrara.wordpress.com/2011/03/02/are-pensions-better-than-401ks/#comments</comments>
		<pubDate>Wed, 02 Mar 2011 17:06:23 +0000</pubDate>
		<dc:creator>darfferrara</dc:creator>
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		<guid isPermaLink="false">http://darfferrara.wordpress.com/?p=217</guid>
		<description><![CDATA[Maybe, but maybe pensions are severely underfunded. Tyler links to two viewpoints, so you can make up your own mind. It&#8217;s important to note that if my 401k underperforms it doesn&#8217;t take down everyone else with me.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=darfferrara.wordpress.com&amp;blog=8608520&amp;post=217&amp;subd=darfferrara&amp;ref=&amp;feed=1" width="1" height="1" />]]></description>
			<content:encoded><![CDATA[<p>Maybe, but maybe pensions are severely underfunded. Tyler <a href="http://www.marginalrevolution.com/marginalrevolution/2011/03/how-bad-is-the-state-pension-funding-mess.html">links </a>to two viewpoints, so you can make up your own mind. It&#8217;s important to note that if my 401k underperforms it doesn&#8217;t take down everyone else with me.</p>
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