The Filter^

Paper Wars

The intellectual papers moved to broadsheet as a measure against a tax on the number of pages per newspaper, a tax which has long since lapsed. It's always surprised me that the papers seemed locked into the broadsheet format.

The Independent performed a masterstroke in moving to tabloid format in 2003, and withdrawing the broadsheet in May, this year. The Times followed suit, providing an easier challenge for the commuter, and inevitably a response was expected of it's competitors, in light of falling sales.

A Financial Times story shows that The Guardian have responded with an extensive relaunch based on a "compact" size. Similar to that of The Berliner, La Monde, and several US papers, it'll be thinner than a tabloid, but longer. Here is the Media Guardian announcement.

A shame it's taken the papers so long to innovate, but as an Independent convert, i'll look forward to returning to the Guardian once the new size comes out.

Thanks to Matthew Whitfield for the coffee and pointer

Not outnumbered... just out

The disappointment has dissipated, and instead of searching for scapegoats I'll celebrate the support England had in the Estadio Da Luz.
With an initial allocation of just 10,000 it was remarkable to see England fans outnumber the Portuguese in the 52,000 seater stadium. Remarkable, but explanable.

According to The Coase Theory, with zero transaction costs resources will be owned by whoever values them the most, regardless of the initial allocation. Since England fans valued the tickets higher than the Portugese there was always a price at which a Portugal fan would be willing to sell them on.
Thousands of England fans had flocked to Lisbon, creating a low transaction cost environment for trades - watching a Channel 4 news report on touting reminded me of a well oiled fish market.

The only impact of the initial allocation is the wealth affects, and giving them to Portugese people was effectively a gift from UEFA. It would be like giving a non-smoker in prison a crate of cigarettes: "thank you very much, bidding starts at a tenner".

But why did England fans value them more? Perhaps the match was more important to us then it was to them, or perhaps it was an Alchian-Allen effect.

If a low quality lobster is worth £2, and high quality one £4, and it costs £4 to transport a lobster from the Highlands to London, what are the choices?
For a Scotsman, its between paying £2 or £4.
For a Londoner, its between paying £6 or £8.

We'd expect high quality lobsters to sell more in London, since the quality premium is relatively smaller.
Similarly, since English people had already spent hundreds of pounds to get to Portugal, once there they'd be more likely to pay alot for a ticket.

Shame it all ended in bollocks.

Brutalist Beauty

An Architecture Week event has discussed the merits of the National Theatre, under the title "Brutalist Beauty?"

From The Guardian

The National Theatre's Artistic Director Nicholas Hytner and actor Fiona Shaw square up to architect Mark Foley to debate the merits and misfortunes of Sir Denys Lasdun's National Theatre building, whose brutalist concrete form inspires love and loathing in equal measure.

An article on BBC Online following the death of the architect, Sir Denys Lasdun offers examples of such opinion:

The building:
"a clever way of building a nuclear power station in the middle of London without anyone objecting"
-Prince Charles

And the man:
"a pioneer, a world-class architect who had tremendous influence".
- Sir Norman Foster

I adore the NT for it's functoionality, and the staggered verandas that decorate the exterior; an interval overlooking the Thames can be breathtaking. It reminds me greatly of the Royal Sun Alliance Building in Liverpool, it too generating extemes of feeling. The Daily Post lambasted the "sandbox".

And whilst I'm on the subject, here's one of my favourite buildings on the Wirral. My local Sainsbury's.

(The photo of the NT comes from www.isaphoto.co.uk/ pages/exteriors2.htm).

Ten Dollars that could've changed the world

In 1940, 12-year-old Cuban boy Fidel Castro wrote to US President Franklin Roosevelt to request a $10 note. He included a return address at the Colegio de Dolores in Santiago, Cuba, where he was studying at the time. The White House had an office to deal with all the president's correspondence and sure enough Fidel Castro received a reply, but disappointingly, no bill.

About 19 years later, his guerrilla campaign toppled the seven-year military rule of Cuban President Fulgeneio Batista and, at 32, Mr Castro became the country's new leader.

What if Castro did receive a ten-dollar bill? Would he have turned into a rebel (and sometimes cult icon)? Would the world have become a better place? Leibniz thinks not. His "possible world" theory suggests that of all "possible worlds", the "actual world" we live in is the best possible one. Confused? Read more about Leibniz here.

Read the rest of the story at the BBC.

Governance in Everything

The time has surely gone in which economists could analyze in great detail two individuals exchanging nuts for berries on the edge of the forest and then feel that their analysis of the process of exchange was complete, illuminating though this analysis may be in certain respects.

- Ronald Coase, Nobel Prize Lecture.

The blind faith some people have with the "market" is not merely annoying to the have-nots, but also theoretically incomplete. Traditional microeconomics treats the "market" as an exogenous component from the analytical framework, where in actual fact, one can measure and compare the costs of using the "market" with other alternative arrangements.

Once one realises that the "market" is one of the many possible governance structures available to a society, constrained by broadly-defined transaction costs, a more powerful analytical framework is at his disposal. Informal committees, trade associations, sometimes, governmental departments and most common of them all, the Firms, all work well as governance structures under different circumstances - all explained away with the confirmable hypothesis of maximising behaviour under constraints.

In the next few months, my aim is to write up a few interesting examples to illustrate my thesis outlined above, focusing mainly on small organisations where negotiations and low enforcement costs have enabled them to work outside the "market".

PS: I will leave the "market" to Marginal Revolution, where they have been doing a great job in unearthing interesting voluntary exchanges conducted around the world.

PPS: Where's William Butterfield's Ubiquitous Markets? It was supposed to be "a looong series" - I was so looking forward to reading that...

Economics & Geology

'I want you to keep a notebook,' Peter had said. 'The
architecture and building in London is a discourse on
the movement of power and money. You'll find it's a
kind of economic geology. From the church to the kings
to the aristocracy to the merchant classes to the
banks and finally to the multinationals. It's like
reading rock strata.'

from "The Stars' Tennis Balls", Stephen Fry

Wayne Rooney

Never be surprised by the extent of the phenomena of Wayne Rooney. Anyone on Merseyside had heard of the Beast long before 'that goal' against Arsenal, and his rise to the top of European football was long predicted by all who saw him play. His debut for Everton was the first game of the season in 2002, but since I coach on Saturday's I had to wait until the following Wednesday, against Birmingham, to get a glimpse. I'll never forget watching the emergence of a superstar.

Last night though, I was genuinely amazed by his progress. Not for the fact that once again he carried the entire England team, providing the only real positive in a disappointing performance.... rather, he was discussed by Germaine Greer on Question Time. Astonishing!

Academia as a Creative Commons

A commons can be a sustainable structure, if information costs are low, and incentives prompt derivitave works.

As a football coach, I enjoy getting to matches early to observe warm-up techniques, and adapting them. If I drive past a training session I'll have to slow down and see what the coach is doing. Once I created atechnique session called "T-Ball Zulu 5000", and within a week I saw several other coaches doing the same thing. Needless to say, I've utlitised far more of their work than they have of mine.

The costs of claiming property rights to coaching methods, and of monitoring other coaches prohibits any private structure. I shan't claim it as a 'public good', but since coaching methods is largely about invention, once created it exists independent of the creator.

It therefore worries me to see academics arguing against file sharing or commons based governance of music and film. Academia, after all, is the purest form of a knowledge generating industry. And it's structure is commons based.

Every article is written under a highly constrained system of norms, from the necessity of an abstract or disclaimer, to the detailed presentation of the bibliography. Such norms are voluntarily complied with, as a cooperative measure. There is no "market in articles", the AER does not bid alongside Economica for an essay by Hayek, rather journals specialize, and authors need publications to enhance reputation.

Such a system is indeed underpinned by private property, as Professors form contractual agreements with institutions, or research centres. However the actual knowledge is communally owned - anyone is at liberty to use a published work as a means to creating a derivitive. Hicks didn't need to financially compensate Keynes for the groundwork for his IS-LM analysis, rather the norms of the system required him to have a citation. Then anyone reading Hicks, can also read Keynes.

So for Napster, see Jstor - we can get online, download a work, be inspired by it to formulate our own thinking, and produce a derivitave. For the creation of knowledge, and the innovation of ideas beware the pleas of the people trying to preserve their privilige: a commons needn't always end in tragedy, as shown by the most established form of all.

More of The Filter^ on creative commons...

a reply
commons isn't private
property rights
late but free

Backward Reading

When I'm seen reading a Chinese-language book, an often-asked question is: Don't you read backwards? I usually (and patiently) explain that modern Chinese books are often type-set in the Western way, i.e. characters go from left to right horizontally rather than right to left vertically. Now, the Taiwanese government has decided to take drastic actions, from the BBC:

Official Taiwanese documents can no longer be written from right to left or from top to bottom in a new law passed by the country's parliament. All texts must now go from left to right, like western languages, although arts and literature are not affected. A spokesman said it was necessary as the old method, in texts using numbers and English, "looked confusing".

Is such ruling necessary? Personally, I think not. Word processors generally can typeset in any orientation; readers take no time to adjust to different orientations quickly (I doubt any person has ever read the Bible in Chinese backwards without realising!) - the people who use the language seem to cope with the plurality very well.

When norms are adequately coping with a problem, it always pains me to witness a bigger body stepping in and starts imposing rules in an attempt to solve the same problem - it's often costly, and the rigidity of rules sometimes create unexpected outcomes in the long-run.

Why has Africa failed?

In a word, I'd say governance.

In an essay, Colin Prout broadly agrees. It's an ambitious question to answer, but via an engaging survey of the literature Col delivers a broad education in how economics and politics mingle on the African continent.

Download why_has_africa_failed.pdf

The Filter^ is always on the look out for interesting and accessable essays. Thanks Col, see you when you're back.