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Harlequin5942


				

				

				
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User ID: 1062

Harlequin5942


				
				
				

				
2 followers   follows 0 users   joined 2022 September 09 05:53:53 UTC

					

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User ID: 1062

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"Diminishing marginal utility" is a misonomer. Economists tend to assume that the marginal utility of everything is diminishing, relative to previous units. (Heroin and the like may be exceptions.) The issue is the marginal utility of money vs. other things. In modern utility theory, money has no marginal utility as such; it only has marginal utility relative to an alternative. And utility is typically defined by modern theorists in terms of relative preference, rather than a psychological state of pleasure etc.

If there is a diminishing marginal utility of money, then why do so many poor people buy lottery tickets and otherwise gamble in games with negative expected value?

Moreover, low socio-economic status is associated with high GE [gambling expenditures] (Davidson et al., 2016; Salonen et al., 2018a). To date, a limited number of studies have investigated the relationship between GE and receipt of social security benefits (Worthington 2001; MacDonald et al., 2004). A Canadian survey showed that households with income support were less likely to gamble. With the exception of one jurisdiction, households that received income support spend a lower proportion of their income on gambling. (MacDonald et al., 2004.)

Studies conducted in different countries have shown that although high income groups spend more on gambling, lower income groups contribute proportionally more (Beckert & Lutter 2009; Canale et al., 2016; Castrén et al., 2018; Roukka & Salonen 2020).

Assume that people gamble for the pleasure of taking risks. If there is diminishing marginal utility of money, why would the marginal value of money relative to this pleasure be low for poorer people?

Also, don't middle class and richer people save a higher proportion of their incomes than poorer people? Do they value maintaining their period-to-period monetary assets, relative to their incomes, more than poorer people?

Also, diminishing marginal utility on average is also very different from it being universal. Otherwise, why would many very rich people still work similar hours to poorer people? You can postulate that the former enjoy work, but that's ad hoc, as it doesn't explain why they would prefer paid labour.

I'm not saying that there is increasing marginal utility of money. I'm saying that it is really isn't obvious that money has diminishing marginal utility, even on average.

Gambling seems like a poor example for your point. Poor people are buying the opportunity to imagine themselves getting rich (and every once in a while it happens). People who already are rich can buy real investments and the psychic thrill isn’t the same for them.

Poor people don't need to gamble to imagine themselves as rich. It does happen sometimes, but the expected value of lotteries etc. is negative.

What's the evidence that the psychic thrill of gambling is less for the rich? Note that, to substantiate this claim, you can't assume a diminishing marginal utility of wealth.

The higher savings rate for the wealthy also seems like evidence of diminishing marginal utility of money. Wealthy people put more money away because spending is a lot less urgent than someone struggling to make ends meet.

If it's less urgent, then that means that their preference for saving a marginal unit of money vs. spending it is greater. As I said, in modern utility theory, something only has utility relative to something else; mathematically, utility is defined as an ordinal variable corresponding to a ranking of alternatives.

There's a further issue, of course, of defining a common unit of utility across people. I'm assuming that's somehow not a problem, because otherwise the "diminishing marginal utility" position is REALLY stuffed.

I also forgot another reason why "diminishing marginal utility of money" is a misnomer: it should really be called "diminishing interpersonal marginal utility of money", because the marginal utility can be decreasing for each individual and yet the value of one more unit of wealth can be greater for rich people rather than poor people. Diminishing marginal utility of money for each individaul does not imply that an additional dollar gives greater utility to a poor person than a rich person. In fact, it's logically possible that money can have diminishing marginal utility for each person and yet one still maximises utility by taxing the poor to give to the rich.

For example, consider a society with two people, A and B. We define MUn(a) as the marginal utility of money for the nth unit of money for A and MUn(b) for B mutatis mutandis.

Suppose that MUn(a) = 1^(-n). So the marginal utility of the 100th unit of wealth for A is 1 / 100. The marginal utility of the 10,000th unit is 1 / 10,000. Thus, the marginal utility of money for A is diminishing: it decreases with each unit. In fact, it's monotonically diminishing: the marginal value of the nth unit is less than each previous unit.

Suppose that MUn(a) = 1^(-√n). So the marginal utility of the 100th unit of wealth for A is 1 / 10. The marginal utility of the 10,000th unit is 1 / 100. Again, the marginal utility of money for B is (monotonically) diminishing.

If A has $499 and B has $159,999, then the value of an additional dollar for A is 1 / 500 and the value of an additional dollar for B is 1 / 400. Utility is maximised by B having the additional dollar, even though we are assuming utility is (montonically!) diminishing.

And again, this is all assuming away the problem of interpersonal utility comparisons, because otherwise I don't begin to have a functioning version of your position with which to play. You could say "Obviously, utility doesn't work the way you specify in your example," but then you ARE obliged to explain how you find a common unit of utility for people in the real world, because all I am granting in this example is diminishing marginal utility of money (relative to something else that is common between A and B, e.g. assuming a common valuation of a Big Mac).

Source: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4034138/

I also forgot how to spell "misnomer".

(1) I talked about proportions. There's nothing by definition that says that rich people have to save a greater proportion of their incomes than the poor.

(2) Your reasoning about rich people assumes that paid labour is equally preferable to unpaid labour, e.g. working as a bank director is as enjoyable as volunteering for a charity. This seems implausible for me. Do you have evidence for this "obvious" answer?

(3) What do you mean "get more out of"? If you mean "more utility", then you are begging the question. The point of my examples was to muddy the waters: one can cite evidence both for and against a higher interpersonal marginal utility of wealth for the poor vs. the rich. I think the honest answer for utilitarians is to say that they don't know, and that intuitions to the contrary are based on a hedonistic analysis of utility that ran aground in about 1850-1950, when it proved impossible to find a non-arbitrary interpersonal scale for utility. That's why economists and many ethicists ditched the hedonistic analysis of utility in favour of a preference-ranking analysis, but a preference-ranking analysis doesn't give you an interpersonal scale.

since for him it’s the difference between eating and not eating right then and there whereas for Elon it’s not even a rounding error

But it doesn't follow that the marginal utility is higher for the beggar than Elon Musk.

Haven't they? Absolute gap is persistent, as you noted, but growth rates closely track US ones. Also it might be a good thing to have certain per capita gap -- to have a room for catch-up.

I was using nominal GDP per capita. Both PPP and nominal measurements have their advantages, but that would take me too far astray here, since I am just presenting a prima facie case for right-wing utilitarianism, to clarify that it's not obviously an incoherent position. (I'm steelmanning it; I'm neither consistently right-wing nor a utilitarian.) And, as you note, there is a persistent lag in PPP.

I don't see how having room for catch-up growth is a good thing. It's the catching up that is good, not the growth per se!

As for unemployment vs. poverty, I think that this can't be solved by anecdata. It's very plausible that being unemployed in Sweden gives higher utility than being near starvation in Ethiopia, but the poor in the US are not on the verge of starvation.

Could you elaborate on this?

Sure. I see utilitarianism as a bit like the paradox of hedonism. It is very hard to know what will make one happy at an individual level, and vastly harder on a collective level. Sure, there will be massive cases of suffering and (less often) massive sources of happiness where the path to maximising expected happiness is reasonably clear, but that leaves a lot of decisions unguided. Also, since one's own biases are often hard to scrutinise, it is easy to be misled when working out individual cases on their expected utility merits. Conflating one's self-interest or sentimentalism with expected utility maximisation seems pretty easy.

Rather than trying to maximise on each individual decision, a utilitarian can set up rules and rights that are to be respected unless there is a strong case to the contrary. (This is compatible, but not identical with rule utilitarianism.) This is a bit like the rules solution to the time inconsistency problem: if maximising a social welfare function in each time period results in suboptimal outcomes in the long-run, then an alternative is to set up rules that may not be maximising in every case but which probably do relatively well in the long-run, e.g. a 2% inflation target rather than traditional Keynesian fine-tuning of the economy. Similarly, being somewhat of a deontologist seems better for aggregate utility than consciously utility-maximising, given the computational, epistemological, and psychological limitations of human beings.

one I am very fucking sensitive to having just lived through the Canadian lockdowns.

Understandable, but it would also be understandable if this intensifies your passion on this issue beyond what is reasonable.

(1) But the issue is marginal income - that's where there's an additional dollar. If a poor person has an increase in marginal income and their income is enough to cover basic costs, then there is nothing in the definition of "rich" and "poor" that implies that they save a higher proporiton of that additional dollar than someone with greater wealth.

(2) If the job is different, then you've not explained why many rich people prefer paid labour like being a bank director to unpaid labour like volunteering for a charity.

(3) But what's the common scale for the comparison? Assume you prefer throwing the $150 away and the homeless person does not. That tells us about the internal structure of your respective utility scales, but doesn't tell us that their utility is higher on a scale that incorporates the preferences of both of you.

(1) That was me being sloppy. I should have said "proportion of their marginal incomes", since the issue is the marginal utility of money.

(2) I didn't say that rich people never quit work and volunteer, I said that many rich people still work as many hours as poor people, which is odd if they have a diminishing marginal utility of money. Maybe are competing for extra-monetary status, which is associated with a lot of paid labour. My point is that the view that the marginal utility of money is greater for poor people isn't obvious, though it may be true for all I know.

(3) I agree that we might be able to infer that Group Y probably prefers using their new 2003 Honda Civic relative to other activities that Group Y can do and that Group X does prefer other activities to using their 2003 Honda Civic. What is harder to infer - arguably impossible to infer - is that the preference of Group Y for using their new car is stronger than the preference for Group X for using their new car, relative to a common scale.

As it happens, I suspect that we can roughly estimate interpersonal strengths of pleasure (as opposed to preference) across people. I think that behaviourism is a useful methodological guide in social science, but it isn't literally true, and we can make inferences about interpersonal intensities of pleasure, pain etc. based on our similar neurochemistries. So, while I haven't thought about it a lot, I can imagine that there is a true and plausible sense in which e.g. an additional $100 causes more pleasure to a homeless person than it does to Jeff Bezos. However, modern utilitarians and economists have largely abandoned the pleasure analysis of "utility", in favour of preference accounts. This is partly to handle paradoxes like the Experience Machine:

https://en.wikipedia.org/wiki/Experience_machine

The modern utilitarian is that what matters is preferences, which are normally about the world, rather than psychological states like pleasure, which aren't about the world as such.

Anyway, to reiterate, I'm not saying that the original view about utility is wrong. I'm saying that it's not clear that it is true in the sense that it needs to be to produce a (modern) utilitarian argument in favour of income redistribution. This is part of my broader claim that right-wing (to be precise, conservative) utilitarianism is not obviously wrong, even though I suspect that it is wrong both in virtue of being conservative and in virtue of being utilitarian.

When it comes to male/female relations, a good amount of the prioritisation of female safety (and the cultural noms regulating male behaviour around them) are likely influenced by factors unrelated to a simple evaluation of women as being physically at risk. I believe we view harm done to women as inherently objectionable on a more fundamental level and reflects an underlying "empathy gap" of sorts.

Could this be linked to the Women are Wonderful effect?

Man hits woman: she almost certainly did not deserve it, Women are Wonderful

Man hits man: who knows, maybe he deserved it? Men can be so cruel.

Woman hits woman: probably a misunderstanding that could be resolved if they would talk and their mutual Wonderfulness was apparent to each

Woman hits man: since Women are Wonderful, he probably did something really bad to deserve it


Like all stereotypes, there is some truth in this and some falsity. It's true that almost all women are unconfrontational and need a lot of provocation to be violence. However, it's also true that almost all men are that way too! Only a small minority of men tend to be violent with little justification. But, as usual in relations between the sexes, minority groups seem to have a disproportionate impact on people's cognition.

Speaking for myself, and we're leaving politics out of this, I as a white working class Southerner have far more in common with my black counterpart here than I do a wealthy white liberal from one of the coasts.

Among the very few things worth watching on SNL in the past 20+ years:

https://youtube.com/watch?v=O7VaXlMvAvk

Part of me suspects that the movement of the US radical left (especially "intellectual" left) from a focus on the working class to a focus on LGBT and race was driven by a terror that, when the revolution came, one of the main consequences would be a redirection of public funding from opera and theatre to the kind of things that are stereotypically working class entertainment, e.g. sports and crude comedies.

Which data do you use?

That data. If you look at the data from 2007 to 2019 (excluding the covid period, including both the Great Recession but also the recovery period) the US grew steadily from about $48,000 to $65,000, while Denmark and Sweden had stagnation. Norway, as noted earlier, is a special case of good governance + massive per capita natural resources, but it also didn't see a net increase in this period. It's true that they were doing well relative to the US prior to 2007, but my original steelman was that social democracy creates a structural tendency to stagnation as the population ages.

The technological catch up is something I haven't heard and that I think is interesting, but it's beyond the scope of my steelmanning right-wing utilitarianism, since it's not a strongly established position, and my point is that social democracy isn't obviously preferable if you're a utilitarian.

Unemployment and poverty

A lot depends on the details, e.g. I suspect that a lot people high in Big Five conscientiousness would be happier with employed poverty than (somewhat) less poor unemployment. There is a huge amount of literature showing the negative aveerage effects of poverty on subjective happiness (as well as plenty of folk psychology) but the same is also true of unemployment, especially long-term unemployment. Also, the margin of difference between Swedish vs. US unemployment and Swedish vs. US poverty (going on that graph) seems to be bigger in the case of the former, e.g. US unemployment is about 4 percentage points lower than that of Sweden right now, whereas the difference in poverty (using the measure you provided) is about 1 percentage point. The unemployment gap may be bigger than normal right now, but Sweden seems to have a trend unemployment rate of about 8% at best and the US a trend of about 5% at worst. So, even if the harm from poverty is greater, the difference in unemployment is bigger.

On the other hand, you could argue that the graph you give just captures one part of a bigger picture, since e.g. $2.5 a day is hardly luxurious and US poverty may be bigger. Also, poor relief may be more generous in Scandinavia (plausible). A more complex argument could refute my claims. But that's my point! When one takes into account all the differences, the utilitarian cases for right-wing or left-wing policies both need to be complex - they aren't obvious either way.

optimizator

Yes, I think that an epistemically modest utilitarian is still trying to optimise, but what they can plausibly do within their epistemic limitations, which is to find good long-run moral and political rules. Even then, there is an important difference from deontology, in that in extreme cases it may be obvious that departing from the rules will result in better long-run aggregate utility. This is one of the more plausible parts of utilitarianism, I think: you have to be hardcore into rights to be willing to permit massive suffering instead of e.g. making a tiny infraction of someone's rights. The plausibility of consequentialism (with utilitarianism as one variant) in extreme circumstances was part of a debate on human rights a while back in the UK parliament, which I thought was interesting:

https://youtube.com/watch?v=VO2Ry4j79LU&t=221s

But your example is highly disanalogous: in your example, the police have a probable general type of crime (unlawful killing) but not a suspect, whereas in this case the investigators have a suspect, but not a probable general type of crime.

The US is not a sensible target for Russian nuclear weapons unless it is likely to use nuclear weapons against Russia. However, in the event of Russia using nuclear weapons against Ukraine, the US and it allies have a lot of extreme measures they can use that are short of nuclear war or even direct attacks on Russian soil:

(1) Massive, apocalyptic cyberattacks that cripple Russian access to the internet.

(2) Attacking Russian satellites to destroy Russian TV and communications capacity.

(3) Closing off Russian access to the sea at all points.

(4) Closing off Russian civilian air access to all possible points.

(5) Closing off Russian civilian land access to all possible points, including Kalingrad, which would face food shortages etc.

(6) Expelling Russia from the United Nations Security Council. China would almost certainly abstain at worst and maybe vote for Russia's expulsion, since association with Russia would be massively toxic. Russia's suspension from the UN would also be an option. This would mean that, in future, Russia would face Korean War type scenarios, where the UN Security Council could vote to mobilise the UN against Russia and/or its allies (assuming it still has any after Pressing the Button).

(7) Extension of sanctions to countries that still trade with Russia, which after Pressing the Button may not be that many. While India would be out, somewhere like Cuba might still be in, and would face apocalyptic sanctions.

(8) Intensification of sanctions in all respects.

This is why, unless Putin is colossaly stupid, he will not Press the Button, even on a limited scale, let alone bombing Ukrainian cities. Much of the world still likes Russia and there is a lot of incentives for the West to keep their powder dry on extreme measures. Once Russia ends the nuclear taboo, it loses both of those, and goes into a forced pariah status that is unprecedented in human history.

You may say "Are China/India really going to give up on Russia in this situation?" Think of it from their perspective: right now, using nuclear weapons to any extent is taboo. This means that e.g. India doesn't have too much to fear from nuclear war with Pakistan, and China doesn't have to worry about the US using tactical nukes to defend Taiwan. If Russia breaks the nuclear taboo without massive consequences, then that sets a precedent for Pakistan or the US to do so without massive consequences.

Russia has limited (though nonzero) value to China as a semi-ally. That's why China has given very limited assistance to Russia over Ukraine. Being the ally of the country that broke the nuclear taboo is more costly to China than anything Putin can offer them.

For one thing, why would Russia use nuclear weapons to protect China? Why risk the destruction of Russian civilisation to help out Russia's principal rival in Asia? Russia's nuclear arsenal exists to protect Russia, not to destroy it to save another country.

A much better protection against US nuclear is the taboo against using nuclear weapons in any capacity, which... Russia would have broken. Thus, it would be in China's interests to enforce that taboo, including perhaps by blockading Russia, cyber-attacking it, punishing any nearby country that maintained trade or diplomatic links with Russia etc. That way, the US would know that China is a Peace Loving Country, and that there would be severe consequences for any US use of their nuclear advantages.

It doesn't have to be as nimble as the 1940s, it just has to be better at doing so than Russia, with vastly more resources than Russia.

living standards are kind of irrelevant if the government retains control

That's like saying that the flammability of material is kind of irrelevant if it does not ignite.

It depends on what you mean by "intervene at least conventionally". If the US navy and its allies block all naval vessels from leaving Russian territorial waters, is that a conventional intervention or not?

As for the UNSC, there may be no legal mechanism, but that wouldn't mean much in a situation where Russia has broken the nuclear taboo.

I have long had a mental model of Putin as a cautious but ruthless Russian nationalist, who is occasionally led into overconfidence by high oil prices, as in 2005-2008 and 2011-2014. Basically, Brezhnev with a trim waistline, who also was led astray from his normal caution by high oil prices in 1973-1979.

Thus, I interpret Putin's nuclear posturing as for domestic consumption, to assuage the wounded pride of the Russian people. "The West is threatening us with nukes, but WE have nukes too!!" is as much national pride as Putin can offer Russians right now. Pathetic? Yes. Sensible given his goals and means? Yes.

I would also be stunned at the US, China, and their allies doing such things without Russia breaking some huge taboo like using nuclear weapons. Even Russian "strategic bombing" of Ukrainian civilian areas would probably only increase Western aid to Ukraine and investment in fucking up the Russian economy through e.g. reducing the demand for oil.

Just one example: Russia is a perennial ally of India. India is a perennial rival of China.

Another example: there are two major powers with borders, strategic/economic interests, and strong potential influence in Central Asia. Russia is one of them. Influencing this region is a zero sum game. If it's becomes part of the Chinese sphere of influence, then it is no longer part of the Russian sphere of influence. Of course, Russia's interests may coincide with China's for a time, and perhaps even now, but long-term, Russia does not want to be dependent on identifying its interests with China's.

And there's no historical basis to regard China as a potential ally for Russia. Such an alliance has never worked, even when they shared a common ideology.

Is China a major rival for Russia right now? No, I didn't say that. They are rivals insofar as only one of them can be Asia's number one superpower.

Most importantly, China is not worth risking total nuclear war with the US. Nothing short of Russia's survival is. Thus, Russia's status as a nuclear power has very little use to China.

I certainly don't want to suggest that any of these are easy or straightforward, and all of them are unspeakably risky.

They are all escalatable. Think of the Cuban Missile Crisis. The US didn't start by firing at Cuban ships, but that was set for a latter stage of escalation. The plan would be that Russia would back down from a direct conflict. What happens is uncertain - that's what makes these responses unspeakably risky. On the other hand, not having an extreme response to a country breaking the nuclear taboo is also extremely risky - that's why Putin would expect these kind of responses, and why he will not use even very small-scale nukes in Ukraine, unless he is losing his mind (which I strongly doubt).

In Putin's case, I blame oil prices giving him delusions of Russia being great again, or at least having the opportunity to project its power with minimal consequences. That led to the South Ossetian war, which scared many Ukrainians, but probably not enough to make them consider joining the EU/NATO if oil prices had remained high. The 2014 invasion of Ukraine happened to occur at the end of the 2011-2014 oil price spike, right before the 2014-2016 dip. That intervention would presumably have gone easier for Russia if oil prices had remained high for a decade or more. That intervention created a series of entanglements that Putin cannot free Russia from without losing face on a regime-threatening scale.

January 2022-February 2022 saw crude oil prices return to a little above their trend levels. Maybe Putin thought that, if he could act when oil prices were at the start of a 3-5 year boom, this would give him the room to sort things out in Ukraine. Of course, he also underestimated Ukrainian resistance, but a lot of rational and well-informed people did that. I mean, I did that, and I'm the smartest, most well-informed, and most handsome person I know.

China produces more, measured in terms of manufacturing output in dollar terms, but there's not a huge gap:

https://www.brookings.edu/research/global-manufacturing-scorecard-how-the-us-compares-to-18-other-nations/

Russia is similar to countries like Turkey and Spain.

Is there any evidence that we're not just rambling buffoons in our own echo chamber, just like I'd find on either end of the spectrum?

There seems to be value in having exposed yourself to the best arguments from each side of a debate. Ceteris paribus, someone who has only seen the other side at its worst is vulnerable to a biased perspective of the disagremeent. For example, if my only impression of the left/conservatives came from online comments on news articles and Facebook posts, while having read lots of libertarian intellectuals, I would have a sense that left wing or conservative views were products of ignorance and weak reasoning skills. Fortunately, I have had the chance to communicate with many intelligent and intellectual conservatives/leftists, so I know things aren't that simple.

"Ceteris paribus" is doing a lot of work here, though, because people who tend to be involved with politics tend to be very interested in politics, and people who are very interested in politics seem to be more vulnerable to cognitive biases about politics than others. It's like team sports: I know some extremely smart people who fall prey to fallacies as soon as we're discussing their favourite/least favourite sports teams. And this is unsurprising: no matter how smart and intellectual you are, it's hard to produce cool-headed acute analyses about subjects that you are hot-headed about.

The obvious solution is that society should be libertarian, because this tendency of even smart and informed people to be biased about political issues proves beyond any reasonable doubt that democratic state action is a poor way of doing things: voters are either ignorant or biased. I feel very passionately that this is true and all the evidence I've ever seen confirms this hypothesis.

Then I was banned.

Why?