pro libertate net

Dan Friedman’s Morals and Markets is a nice complement to the multidisciplinary collection Moral Markets that I read earlier. Friedman provides an historical account of the interdependence of well functioning markets and moral sentiments and thus an evolutionary perspective that is not limited to economics as he also discusses the respective impact on societal structures and vice versa.

Friedman offers a rather balanced discussion of the benefits and perils of a moral society, when markets need morals and when markets are choked by them. Solely the joint discussion of terrorist and religious groups may seem a bit controversial.

Morals and Markets is not an academic textbook. It tells a coherent story by a sequence of (true) anecdotes that is easily accessible to anyone. In fact, it is quite entertaining while still being instructive.

In the end, Friedman argues convincingly that the major challenge will be to realign morals and markets such that they work together and thus help to improve our society.

Is economics an amoral science? No, though sometimes it seems so. Look at what is taught at most business schools and economics departments and you might certainly get this impression. Indeed, the focus on the rational decision maker – a rather selfish sociopath – in most curricula in business, law and economics may be a cause for the rather unscrupulous behavior that can be observed in the current business world: Greed is good.

The world is not amoral. Even markets are not. Successful economic exchange without trust, reciprocity, honesty and some sense of fairness seems hardly possible. At least if you listen to the diverse team of authors of Moral Markets. And I tend to agree.

Moral Markets is the result of several years of collaborative research and discussion (the list of contributors is rather impressive). It reviews the critical role of social norms in the economy from a diverse set of fields and points of view. The discussion ranges from biology, the animal world and evolutionary arguments to philosophical questions (and answers) and an analysis of our current perception of the economy to the interdependence of social norms and law and of course (economic) behavior. The main message is clear. Without a social conscience we would not be as successful as we were so far. And it is unlikely that we will keep up the pace if we forget the importance of social norms, values and virtues.

My problem with Cussler’s Dirk Pitt novels is that even though they all follow the same basic structure I cannot stop reading them. And as long as there are still some unread volumes on my bookshelves there is no reason to – except of course that I also like some diversity.

Atlantis Found invokes two different opinions in me. First, it is once again a superb, tantalizing adventure. Second, Cussler becomes too practiced. There are some phrases you have to read more often than you would like them to read in one single novel. There are a few plot elements that appear too often in this series and that hurt the credibility of its characters. Lukily, Clussler also breaks with some of his traditional story elements in Atlantis Found and thus introduces a new twist. Finally, the series’ protagonists mature. Their social relations change what may open the door for new developments.

Given that Cussler’s business is to entertain, writing fictional novels that are a mix of adventure and mystery, it is quite astonishing how he almost always embeds his indestructible hero Dirk Pitt in a plot of international political, ecological or economic crises.

This time he broaches the issue of illegal immigration, its probable social and political consequences for the United States on the one hand, and, on the other hand, the ecological and economic issues related to a dynamic, even skittish natural environment like the Mississippi river. The usual love interest, mayhem and personal vendetta are thrown into this mix, too. The result: one of Cussler’s better Dirk Pitt novels.

Ken Binmore’s Rational Decisions is not quite what I expected when I first read just the title. It is, however, something you should very much expect from Ken Binmore. He is an excellent Game Theorist. And even though he eyes current experimental economics rather critically, i.e. he is just more skeptical about some of the claims your standard experimental economists (or are these rather behavioral economists?) are willing to make, his research is very much based on empirical findings, experiments and the boundedness of human capabilities and facilities.

Rational Decisions is about Bayesian Decision Theory. It is about where it can apply and where not. Bayesian Decision Theory It is useful in Games, in situation in which everything is known up to an exactly quantified level of risk. It is utterly “ridiculous” if the decision maker instead is confronted with uncertainty as is the case in the real world where most events do not have a unique objective probability.

Rational Decisions is, therefore, about filling the gap between Decision Making under risk and Decision Making under uncertainty. In my opinion, it is ultimately about an instance of Bounded Rationality.

Binmore gives a comprehensive overview of the standard economic model of decision making and its limitations. He explores the foundations of this model, reviews the historical context and clarifies how Economic Theory has to be interpreted, that current Economic Theory (i.e. the concept of revealed preferences and utility) is not concerned with psychological motives at all.

His writing is witty and opinionated, yet, succinct and clear. Though, sometimes the math made me think twice… All in all, Rational Decisions is a very enlightening experience.

Pratchett created a wonderful character: Death. You just have to love every encounter with this guy. Each dialog sparkles with this unique dry sense of humor that is one of the reasons I like Pratchett’s work.

Death appears in almost all Discworld novels. Mort, however, is the first book in which Death is one of the main characters and has more “page time” than otherwise.

Mort is definitely one of my favorite Discworld novels.