Thursday, 28 June 2018

On Looks, Height and Higher Wages


When watching the Cathy Newman interview with Jordan Peterson a while back, I recall a moment when it looked as though he was going to suggest to her that if she was much less attractive she probably wouldn't be sitting there on television interviewing him. He did, of course, stop well short of saying that, and it may be that I'm misinterpreting on his behalf. But I do recall a point in the interview when it came across my mind: whether Cathy Newman has ever consciously considered that the job she is doing is itself quite narrowly selected for in terms of physical appearance.

This is all based on well known correlations between positive characteristics, like beauty and height, and higher earnings. Last time I checked, attractive women earn on average about 5% more than less attractive women, and attractive men earn on average about 10% more than less attractive men (it may have changed slightly since then). This indicates that the less-attractive men are penalised more in the labour market than less-attractive women. When it comes to weight though, heavier women are penalised with lower wages whereas men not much so.

But what is the causality here: Do people earn more because they are more attractive, or is it positive qualities associated with attractiveness that make them more likely to be in higher paid jobs? It's just a hunch, but I feel fairly certain that in the vast majority of cases it is not the good looks that are making people do well in the labour market - it is much more likely to be the things associated with good looks that play the vital role in this success. 
 
For an analogous example, I remember reading in a social science journal about 10 years ago that while height is advantageous in the labour market, the people upon whom this advantage is conferred are not the tall in general, but more often those tall adults who were also tall in high school. People who were not that tall in high school, but who went on to be tall in adulthood, did less well on average than those who were also tall all the way through high school.  
 
Similarly, just as being a tall high school pupil engenders confidence and status, I think it is likely that on average more attractive workers are more likely to be healthier, more confident, have a wider social circle, be less insecure and be more outgoing. And if this was the case since their school years, it would be unsurprising that this plays out with higher wages later on, as better looking people have more confidence in looking for promotions and higher self esteem when it comes to demanding more pay.

I've also noticed that good looks appear to be more of a priority for employers in businesses where good looks matter more - especially in the service industry. For fairly obvious reasons, consumers are more likely to care about a good looking barmaid or shop assistant or waiter than they are a good looking bus driver or cleaner or financial adviser. Similarly, if all those positive qualities associated with attractiveness help in the labour market, then you would expect to see, on average, better looking people earning more across the board.

But by equal measure, with these determiners, you should also expect to see outliers, where many less attractive people are out-earning their competitors by having positive qualities associated with being the physical underdog - like tenacity, perseverance, diligence, and other efforts that rely less on natural qualities and more on hard work.

I must admit, though, I'm still stumped as to why less attractive men suffer more in the labour market than less attractive women, given the looks are purported to be a more important aspect of womanhood than they are manhood. And I can't find any studies that shed any light on this.

The only thing I can think might be driving this is not that being less attractive is any more important for males than for females, but perhaps that work is, in general, a more important factor in male status-mongering - and therefore more women that are disadvantaged by looks have opted out of the labour market altogether, skewing the statistics.

Wednesday, 27 June 2018

Free Tampons For All: A Bad Idea


You'd like to believe that qualified doctors are fairly well educated people. Alas, on this occasion they have proposed a thoroughly foolish idea - that sanitary products should be handed out free to all menstruating people.

While it seems fairly obvious that it's a good idea for hospitals to provide sanitary products as part of the patient's course of care during procedures, I can't for the life of me understand why anyone would think it's a good idea for the state to subsidise sanitary products for the whole population.

When I think people are wrong, I can almost always see the reason why they think as they do. But not so here - I can't think of any merit behind the idea, when the alternative of providing money or vouchers for people who cannot afford these products is obviously so much more preferable.

I'm also baffled as to why the doctors voting for this want to stop at sanitary products for menstruating people. If it's the nature of the need that galvanises them, then why not have the state provide all the toilet paper for the population too? In fact, why stop there - water is an essential thing for life, so why don't we insist the state pays all our water bills too?

No, this is ludicrous. By all means, let the state help out with the provision of sanitary products in any cases where it is difficult for someone to buy them - when staying in hospital, in emergency cases in schools, etc - and naturally, let the state provide the funds for anyone who can't afford basic necessities like tampons, toilet paper, food, water and clothes. But for heaven's sake, don't let the state anywhere near the operation of providing sanitary products for the entire population. There are things called shops for that - and shops have the commercial nous and diversity of product to meet every consumer's needs.


Monday, 25 June 2018

A Botch Up Of Statistics: Do Gay People Really Have More Sex?


A friend posted a link to an article in The Economist that I ended up clicking on to read. It purports to dispel the myth that gay people have more sex by mining the data from a popular dating site. Here is what they claim to have found:

"It seems that the gay men, straight men, gay women and straight women on OKCupid have all had exactly the same median number of reported partners: six."

Dear oh dear. It would appear that The Economist is being sloppy here - it is taking its sample group from one source - a dating site called OKCupid - which has an above average number of people not in relationships, therefore an expected above average number of sexual partners. That is not an adequate sample group for determining whether gay people have more sex than the broader heterosexual population.

It would be a bit like checking the UK population for homophobia, but only surveying people in mosques; or checking who in the UK population has obtained five GCSEs or more, but only surveying people serving time in prison; or checking the UK population for obesity, but only surveying people in gymnasiums. I have no idea whether gay people have more sex than straight people - but either way, mining such a small sample set from a popular dating site is not going to provide a reliable heuristic for determining one way or the other.

I could take a stab at the problem from an economic perspective - but I have nothing to base it on, only conjecture. And given that The Economist couldn't do any better than a highly unrepresentative source like OKCupid, I presume that there isn't a comprehensive data set on this matter (I haven't checked - so do post a link to correct me if I'm wrong).

A more inquisitive way to consider such questions from an economic perspective would be to ask: what might motivate gay people to have more sex than straight people? I can think of one or two possible reasons why. Here's one. Gay couples are disproportionately childless, and are therefore probably likely to have more sex than couples with children. Being childless they are probably less tired; they probably have more opportunities of an evening in not having to worry about the kids. Added to that, parents have extra reasons to stay healthy and live longer, which is probably a factor too in their living less tumultuous lives.

Another factor I can imagine has had a bearing on the statistics would be that, sadly, gay people have incurred more hostility for their sexual orientation over the years than straight people (although it's a lot better now). That might have led to more 'in the closet' sexual activity, but also more depression and anxiety, where increased sex may have had some ameliorating effect. Persecuted and marginalised people may also end up caring less about their own sexual well-being too, which may mean higher incidences of promiscuity.

Moreover, gay people who have felt depressed and marginalised because of their sexuality, especially younger people, are probably more likely to go out more to places where sex is part of the night-time scene; and in those environments they are probably more likely to consume more alcohol too, which may also increase the chance of more sex (this is a pattern that has swept across the heterosexual social circles too, with the binge culture providing succour through superficial sexual sustenance).

A final reason, which may play out in their thirties, is that straight men are more likely to have their sexual habits constrained by women looking to be mothers, whereas gay men would not experience those constraints, thereby opening up their options for other partners, and may have more sex in those scenarios.

All of this may contribute to gay people having, on average, more sex than straight people - especially if the lifestyle involves more surreptitiousness, increased family pressures and fewer stable relationships. I don't imagine I can test these hypotheses, and they may turn out to be implausible - but I fancy they are more plausible than The Economist's report from a very unrepresentative data set which is bound to skew the reality of the situation.

My speculative stab at the truth is based on the well worn principle that people usually have good reasons for doing what they do - and I can at least conceive of some possible reasons for changing behaviour regarding these matters. On the other hand, let's hope (and perhaps presume) that we've come a long way since the days of gay people feeling more pressured and under more duress than straight people - and that these past differences in behaviour and lifestyles are now narrow enough to be imperceptible.

Sunday, 24 June 2018

They're Fellow Humans, It's Not Rocket Science!


As most of us have known for years, migrants and refugees are good for economies - and now there appears to be 30 years of evidential data to back this up. This ought to be considered though in line with an important distinction between the benefits of having free movement of labour, and the problems of having free movement of people instituted in regulation (I blogged about this distinction here).

Because, you see, the thing that human beings ought to do, that they don't do enough, is think primarily about the benefit of immigration to the immigrants themselves, not through the very parochial lens of counting costs of immigration on indigenous folk. The two key benefits of immigration for immigrants are:

1) They work hard and try to make a better life for themselves and their family.

2) The better life they are making for themselves and their family is better here than it would be in their home country.

Some people assert that “It’s alright for you, you don’t live in a community that has been negatively affected by immigration!” This is true, but I would swing the twit-ometer back their way by saying “It’s alright for you too, you don’t live in a community like the ones from which the immigrants were escaping when they chose to come here!”

And we all know about Schrodinger’s immigrant – the one that simultaneously comes here to steal your job and sponge off the state on benefits. Schrodinger’s immigrant is largely based on the phenomenon of being angry at immigrants whatever they do, putting on your parts when immigrants work, and putting on your parts when they claim benefits; putting on your parts when they integrate too much, and putting on your parts when they stay in their own communities.

Lastly, you'll also know of those who complain about foreign aid, declaring that we have people on our streets that we should be helping first. It's a familiar piece of virtue signalling, but I would suggest to you that the kind of people who wish to care more about people in their own country by caring less about people in even poorer countries are not likely to be the kind of people who care about either group of people very much.

To end, here's a meme I shared recently that nicely sums up my feeling about treating people as human beings worthy of our love and kindness and generosity, irrespective of where they come from:

Edit to add: In this debate, most people forget to ask the primary question: why are wages low in a poorer foreign country and higher in the UK? The reason they are higher in the UK, of course, is because productivity is higher in the UK, thanks to better technology and advanced capital investments. Consequently, higher wages in the UK are the result of economic growth and prosperity - but equally, where wages are low in foreign countries that have the competitive advantage over the UK in a particular industry, this is wrongly seen as a threat, when in fact, it is another part of the UK’s increase in prosperity. 

This is also where confusion comes about lower foreign wages that are thought to be ‘unjust’ relative to UK wages. If industries in the UK cannot compete with industries abroad, it is not because of low wages abroad, it is because of high wages here: we have bid up wages so high that domestic industries are no longer as profitable and better off outsourced. This is another reason why tariffs are only pursued by economic imbeciles - they add weight to inefficiencies and starve efficiency by keeping prices high for consumers, and keeping competition and innovation down. They also misallocate resources, as industries that are protected from competition keep people and raw materials in areas of the economy that deny other areas of the economy those resources.

Immigration brings about similar benefits in terms of all the above!! 

Wednesday, 20 June 2018

Another Cracking Policy That Will Do More Harm Than Good


We just recently learned that big business bosses will be forced to justify salaries under new government plans, which include gender pay gaps, top end salaries, and also parental leave policies - the whole shebang. Not only is this is a terrible idea because of the misunderstanding of the facts - it is a potentially damaging idea that will probably harm those it seeks to help.

What's behind the insistence that big companies are now mandated to calculate and publish their ‘pay gap stats’ is the spurious belief that there is an unfair pay gap between men and women (there isn't!) and that the firm's top earners are riding roughshod over the lower earners in the company (they are not!).

Not only have these politicians shown they don't have a very good eye for facts - what's more, even if it were true that there is an unfair gender pay gap or an unhealthy stratification, this policy is too low-resolution to get to the heart of it. Simply getting firms to publish their pay stats won't get to the crux of why, when there are differences, those differences exist. Only by comparing jobs like for like can this policy be illuminating - and this latest idea will not achieve such a thing.

A firm that publishes the mean and median salaries of the men and women in their workforce will omit many vital factors that determine pay, such as experience, qualifications, risk-taking, scalability, and several other minutia areas of the remit. A proposal that looks to redress what it thinks are illegitimate causes of a pay gap that are actually legitimate causes would do more harm than good. 

But that's not all of it - unfortunately, such an injudicious policy may well come with another unintended consequence - one that could actually disadvantage women in the workplace by skewing employer incentives to act against women.

A firm that is forced to demonstrate a 'fair' balance of sheet of equal pay when there is currently a 'fair' balance sheet of sometimes unequal pay is not going to help women, it will only harm both women and men, because some of the important factors that determined legitimate unequal pay (experience, risk, working patterns, qualifications, different priorities, etc) and some of things that determine what people value from a job (flexibility, shorter hours, career breaks, reduced responsibility, working from home) will be undermined.

It will be yet another example of a deleterious effect that comes when politicians stick their noses in where they do not belong.

Monday, 18 June 2018

Why Capitalism Is A Lot Like Magic


Magic is defined as the power to influence by using mysterious forces. The magician on stage bewilders his audience because he knows things about the set-up that the audience does not.

Capitalism is like magic because its powers are seeped in qualities that appear to be mysterious to the majority of the population. Even very prescient minds like those of Adam Smith, David Ricardo and John Stuart Mill were nowhere near envisioning just how this miracle of capitalism would take form.

The magic of capitalism, to the nascent enquirer, is that it appears on the surface to depart from the rubric of one of humanity's great laws - the law of diminishing returns. This is why so many people see capitalism as a zero sum game, and are so regularly confused by the fallacy of the fixed pie - it can be quite counterintuitive. After all, if I have more of something, doesn't that mean someone else needs to have less?

Sometimes, yes. If I buy the last packet of cookies in the local corner shop, the person behind me might have to wait until more stock is delivered. If I give you 2 slices of my pizza, I will only have 6 slices left instead of 8. Nature adheres to similar regularities: one barrel of oil sold in the market is one less barrel of oil in the ground. A potato farmer who digs up his yield has fewer potatoes in the soil.

But imagine a potato field whereby every time the farmer dug up his yield he ended up with more potatoes in the soil than before he started. And suppose that after digging up his mysterious additional yield he found that there were even more potatoes than previously before. If this process kept occurring, we would rightly infer that the farmer has a magic potato field.

 

Capitalism is like the magic potato field. It is not just a trading of goods and services - it is, at heart, a trading of ideas and innovations, and they do not yield diminishing returns; they proliferate in number, rather like (and also because of) populations increase because of exchanges of DNA through sex. When people think up ideas that go on to become light bulbs, combustion engines, stethoscopes, mousetraps, cat's eyes, cars, helicopters and space stations - the opposite of diminishing returns happens - we enjoy the law of increasing returns.

This is why capitalism is rather like magic - a non-supernatural miracle, if you like. The more we increase our prosperity, our progress and our standard of living, the more we can increase it further; the more ideas we have, the more ideas we will have; the more jobs we create, the more jobs we can create; the more we innovate, the more innovation becomes possible; and the better our standard of living gets, the better it can become.

Not only is this why capitalism is like magic - it is just about the only thing in the world of its kind: where individuals who pursue improvement for their own lives, simultaneously make everyone else better off by doing so. It is the great human cooperative; the greatest democracy; the greatest antidote to corruption and tyranny; and the greatest celebration of talent, diversity, individual sovereignty and equality (yes, equality) the world has ever seen or probably will ever see.

That so many people are its enemy; that they so willfully misunderstand it, distort it, cherry pick at it, formulate so many confused arguments against it, and call for interventions that retard its gravitas, stifle opportunities and impede its magical effects on fellow humans is one of biggest regrets we as a species should have.  

Saturday, 16 June 2018

My Top 20 Exhilarating Things For The Mind To Master Before It Dies


In no particular order, my 20 things to take the time to master in life to attain an enriched & exhilarated mind:

1) Hume's distinction between causality and causation, and the fact that everything we know comes from experience

2) That mathematics is the territory and physics is the map, not the other way around

3) Aumann's Agreement Theorem

4) Price Theory

5) Applying nature's principles of natural selection and the law of parsimony to human applications of behaviour

6) Bastiat's principle of 'That Which is Seen and That Which is Not Seen'.

7) The nature of logic: that logic is derived from experience and arises out of our own conceptualising of the world

8) That everything to do with God is both a creation and a discovery

9) That the free will and determinism topic is not an 'either/or' proposition - it is a mathematical spectrum.

10) Harsanyi's Amnesia Principle

11) That morality is both objective and a human invention

12) The principles of Comparative Advantage

13) That competition and exchanges of goods, services and ideas are the primary things that drive progress

14) The Ideological Turing Test

15) The Coase Theorem and Pareto Efficiency

16) Which 'unequal outcome' situations are problems that need solving, and which are simply an aggregation of individual differences.

17) That physics and metaphysics seamlessly blend into one another's territories

18) The sorites paradox and its application to human ideas

19) The fundamental details that make up the great enrichment and the hockey stick of human progression

20) That the sovereignty, rights and liberties of the individual are primary over any group or association that individual has

Wednesday, 13 June 2018

Being Smart When Dining Out


I’ve been reading Tyler Cowen’s book on food - dubbed ‘New Rules for Everyday Foodies’ - which contains a few pearls of wisdom on dining out that I thought worth sharing.

1) At fancy and expensive restaurants (say, $50 and up for a dinner), you can follow a simple procedure to choose the best meal. Look at the menu and ask yourself: Which of these items do I least want to order? Or: Which one sounds the least appetizing? Then order that item. The logic is simple. At a fancy restaurant, the menu is well thought-out. The kitchen’s time and attention are scarce. An item won’t be on the menu unless there is a good reason for its presence. If it sounds bad, it probably tastes especially good. So order the ugly and order the unknown. You’ll probably get a better and more interesting meal.

While it’s not a watertight system, I like the idea of keeping it in mind as a possibility, as it has proved fruitful for me in the past. On the other hand, be wary of something Tyler Cowen neglects to mention. Some of the more attractive sounding dishes on the menu will be included for perceived consumer popularity - not for their high quality but for their high demand from less discerning customers. Chicken dishes often tend to be contained in this set.

2) When you enter a restaurant, you don’t want to see expressions of disgust on the diners’ faces, but you do want to see a certain seriousness of purpose. Pull out a mirror and try eating some really good food. How much are you smiling? Not as much as you might think.

Yes, indeed. Restaurants where there is lots of fun and laughter can be great places for a night out. But don’t necessarily be put off by a restaurant in which the patrons are eating quietly and not communicating much - it can often be a sign that the food is glorious. The average person, when devouring a gorgeous meal, probably focuses quite prominently on the food, and is less loquacious because of it.  

3) The larger the number of restaurants serving the same ethnic cuisine in a given area, the more likely the food they serve will be good. Why? Restaurants that are competing most directly against each other can’t rest on their laurels. They are also typically appealing to an informed customer base. And finally, they can participate in a well-developed supply chain for key ingredients.

True, restaurants in highly competitive areas are much more likely to keep up the high standards of cuisine that will keep the customers coming in. And as a corollary, sometimes you need to be wary of small towns with only one Chinese or Indian or French restaurant. If competition is sparse, sometimes standards will slip.

In addition
Now, as Tyler’s book is a heavily centred on American dining, it probably won’t surprise you lovely readers to learn that I’ve gathered a few of my own pearls of wisdom throughout my own dining experiences in the UK and in Europe:

Don’t necessarily have a main course
In decent restaurants, you are going to find some nice mains, but some lovely starters too, and a few decent side dishes. Given that you’re likely to experience diminishing marginal utility with a main (it is usually less enjoyable after consuming the first 50% on the plate), consider skipping the main course and instead order two or three starters and a side (or sometimes even better, if you’re a couple dining, two mains or six or seven starters and sides that you can share).

Restaurants will pretty much give you any combo you want if it's on the menu - just ask
If it's on the menu, it's in the kitchen - so as long as you don't commit the faux pas of offending the chef by asking him to compromise on a dish he or she has taken pride in creating, feel free to ask for any combination of things you’d like. If, for instance, you see halloumi as a part of a main, but you want another main, and halloumi as a side, and a sauce that’s in a dish you don’t want but you’d like it in one you do, tell the waiter, and you’ll usually find you get the exact dish you desire. You may even give the chef some new ideas! 

Specialising brings rewards
Try to avoid ordering a food that is not part of the restaurant’s speciality. Why is food sold at a bowling alley generally likely to be worse than food sold in a restaurant? The reason is - it's about speciality. A restaurant specialises in selling food; a bowling alley specialises in selling a good time bowling. Food is an additional extra in the bowling alley, but the main selling point of a restaurant, so you'd expect it to be less good in a bowling alley. Try to eat your lasagnes in Italian restaurants, your paellas in Spanish restaurants, and your curries in Indian restaurants, and so forth.

Pasta dishes are generally a bad thing to order
Why? Two reasons. Firstly, pasta dishes are one of the easiest and cheapest dishes to cook yourself (see my next one below). Secondly, pasta dishes are generally bad value for money in terms of the ratio of pasta to other ingredients: the dish has far more pasta than anything else, and consuming it is therefore a sub-optimal use of your taste buds and digestive system. If you’re in a restaurant with pasta on the menu, there will be plenty of superior choices instead.

Eat what you wouldn’t cook for yourself
It’s a good idea to regularly order dishes in restaurants that you are unlikely to eat at home or have cooked for you elsewhere.

Go to restaurants where rent is likely to be high but the owner not filthy rich
A restaurant in a high rent area has expensive overheads - and this in a highly competitive industry where over 50% of all restaurants close within three years of starting up. A restaurant in a high rent area needs to a have a continual standard of top notch food, or else face closure. And in highly competitive areas of the city too, this brings a high probability that the food will be very good.

Finally, here’s one for staff restaurant frequenters - be on the lookout for the kitchen’s incentives
If haddock was on the menu the day before, you might want to think twice about ordering fish pie if it’s on the menu a couple of days after.

Further reading --




Tuesday, 12 June 2018

They Don't Know When They Are Onto A Good Thing


A parliamentary committee has got its knickers in a twist, believing that the tuition fee system for England's universities is ripping off students and giving taxpayers poor value for money. The reality is, the system is not ripping off students - the size of the debt the committee is balking at is to do with there being far too many students, doing degrees not worth their price to the taxpayer.

Currently around 45% of student loans end up being written off, so if the article is right in saying that in the next 25 years the debt is going to rise to £1 trillion, then at this rate the cost to the taxpayer will be in the region of £450 billion of unpaid debt (this will be offset by tax revenue from post-graduate earnings, but that would still come into the treasury in tax revenue if prices of degrees better matched their value to society).

The report calls for "immediate reforms" - such as “cutting interest rates on repayments”. This is a foolish idea: interest rates constitute the price of borrowing, and should not be cut, because money loaned now will not be worth as much in the future, so the interest reflects the cost of the loan to the lender. If you’d lent me £50 in 1989, and I insisted on paying it back in 2019 - it doesn’t take much imagination to work out who comes out best on the deal.

The student loan system isn't a terrible system if and when graduates pay it back through their high earnings. The system is geared towards bridging the disparity between your peak earnings, your peak equity and your peak debt, because the majority of your biggest expenses come in your first two decades of your adult life, and the majority of your equity and highest earnings come in the last two decades of your working life.

Consequently, cries that the system is unfair to students are really quite laughable - unless you have a very odd interpretation of the word 'fairness'. A post-graduate student who goes on to earn £24,000 a year will pay back just £42 per month. Earn £27,000 a year and he'll pay back just £65 a month. Earn £30,000 a year and the repayment is a meagre £87 - hardly unreasonable sums.

The main thing that muddies the waters in this system is when too many students are doing degrees. And it isn't surprising to find in a study that when prices of degrees are more in line with what they cost to obtain, the motivations to find higher paid work are more apparent - which is exactly what we'd hope to find.

Further reading - if you would like a more detailed treatment on this, I once put it all down in a blog here:

Saturday, 9 June 2018

Creative Destruction: The High Street 'Crisis' Is Like Trump's Tariffs In Reverse

 
Many people are bemoaning the so-called high street crisis as being indicative of some kind of prophecy of doom on our retail industry. Now while we can all feel sympathy for the people that lose their jobs because of this, the overall picture is that just the opposite is happening: the closure of the high street shops is democracy's way of saying that better things are happening elsewhere, and that on average, the public is reaping the rewards of an ever-changing society.

This is why it's like tariffs in reverse. Tariffs benefit a small proportion of the domestic population, and hurt the rest of the population, to engender an aggregate loss. High street store closures hurt a small proportion of the domestic population, and benefit the rest of the population, to engender an aggregate gain.

What I'm describing here is standard in economic theory: it is a natural selection-type filter known as Schumpeter's 'gale of creative destruction' (after the economist Joseph Schumpeter). It is the market's way of saying that demand for whatever you are providing, or for the way you are providing it, is declining.

Creative destruction transmits informal signals, not just about who should be selling what, and how, but also about maximising investments, prudent and imprudent capital ventures, selection pressure on innovation and efficiency, new training opportunities, alternative products and improved technology.

Creative destruction is not just a filtering effect on struggling businesses and industries, it is also an opportunity for greater competition, which channels creativity, modernisation and material advance. It does not mean an end to high street stores; it means there is a niche opening for better ones. Competition doesn't just drive drown prices for consumers, and ensure increased efficiency from suppliers - it provides fresh opportunity for would-be businesses to enter the market and add to the value created in society.

Those high street shops, at their best, will not be retailers struggling to compete with more efficient and cheaper online competitors - they will be small businesses like bakers, butchers, patisseries, cafes, restaurants, takeaways and so forth, that are continually able to provide goods and services that people prefer over the bigger retailers, often to enjoy the sense of community spirit too.

Creative destruction involves losses in society as well as gains - but the 'creative' part far outweighs the 'destruction' part - as the threat of bigger competitors acts as a driver for new ideas and opportunities, and continual demand for improved products and services.

To the small minority of politicians who think the so-called high street crisis is their cue to call for state intervention in the shape of bail-outs, subsidies, tax breaks and financial restitution - this is as clumsy as it is foolish. Any political attempts to cushion the blow only serve to distort the vital information signals regarding where capital is best allocated, where labour is best employed, and which businesses and industries are likely to create the most wealth and value in society.
 
Finally, it shouldn't have slipped your notice that the political buffoons appearing on media outlets recently bemoaning the mass decline in high street retailers are the exact same political buffoons who've been so influential in helping these closures along by imposing literally billions of pounds of increased overheads on these companies through their inflated minimum wage legislations and fattened up taxation on businesses. Statist chickens always come home to roost.


Sunday, 3 June 2018

The Feminists Do Women A Disservice Here - Failing To Understand Why There Are Not More Female CEOs


There has been a lot of hoo-ha in the past couple of days about the reasons leading companies have given for male dominance of boardrooms. Several article writers have gone to town on what they consider pathetic excuses for women's under-representation in the boardroom:

• “I don’t think women fit comfortably into the board environment” 

• “There aren’t that many women with the right credentials and depth of experience to sit on the board - the issues covered are extremely complex”

• “Most women don’t want the hassle or pressure of sitting on a board”

• “Shareholders just aren’t interested in the make-up of the board, so why should we be?”

• “My other board colleagues wouldn’t want to appoint a woman on our board”

• “All the ‘good’ women have already been snapped up”

• “We have one woman already on the board, so we are done - it is someone else’s turn”

• “There aren’t any vacancies at the moment - if there were I would think about appointing a woman”

• “We need to build the pipeline from the bottom - there just aren’t enough senior women in this sector”

Not only are most of the above dismal cop-outs, they fail to do any justice to what's really going on, and why there aren't more women in leading roles in FTSE 100 companies. Previously on here I've been through the reasons why the gender pay gap myth is one of the crassest examples of non-thinking currently going on in the debating sphere (see links at bottom of page) - but the reasons why there are not more women in top jobs in FTSE 100 companies is a bit more subtle, slightly more complex, and actually, in my view, more of a credit to women than the feminists realise.

To try to summarise it in a nutshell: the main reason there are not more women in top jobs is because, on average (and remember, we are always talking about on average here - there are always exceptions and outliers), women have better reasons than men for not wanting to be in those jobs. Those reasons are evolutionary, biological, sociological and cultural - and they are, in many cases, examples of where women have a better grasp of well-being and quality of life than men.

To see why, consider a typical man whose preoccupation is climbing the greasy pole of career success. His life consists of working 70-80 hours a week, under highly competitive and stressful conditions, which often involve ruthlessness and one-upmanship, and a narrow focus on a single pursuit. He may well make it to the top, but at what cost to other areas of his life - family, friends, emotional well-being, kindness, empathy and a generally balanced life?

And we all know what the primary phenomenon is that drives people to the top - the pursuit of status; it's the ultimate peacock's tail. Status-mongering is hard-wired into male evolution - for reproduction and survival. In the modern age, humans have developed a socio-cultural sophistication that enables them to be driven by things other than genetic biological stimulus - but status is here to stay, and probably always will be.

Status doesn't dominate your chances of passing on your genes as it once did in animal hierarchies, but it does play a key part in assortative mating. Because women generally desire socio-economically upwards pursuits in the men they wish to have children with, status is a much more important thing for men than it is for women, which is why men are generally far more competitive than women, and why this plays out in the workplace statistics.

In fact, someone (I forget who, possibly a character in a movie) made an interesting observation whilst standing by the Hudson River looking over at the Manhattan skyline - he said that pretty much the whole thing has been designed, bit by bit, by the driving force of the male pursuit of sex and genetic propagation: that it's one big agglomeration of peacocks' tails.
Men are generally more interested in status, and will regularly invest time and energy in pursuits that are traded off for many of life's other rich tapestries of experience. There is a lot more to this complex subject, from both sides (obviously!!) - but the myopic narrative peddled by feminists that women are so unfairly underrepresented in the workplace, and the blinkered attempts above from representatives of leading companies trying to have a stab at the matter, are both inadequate to the task of explaining this.

With a plot of normal distribution (shaped like a bell curve) the data points tend to be close to the mean - so for example, in human height, most adult humans are between 4ft 5 and 6ft 5. But not everyone is; some people are 6ft 8 or 6ft 9, and they are mostly men. In other words, if you met someone on the street who is 6ft 8, it is overwhelmingly probable that it's going to be a man.

Similarly, if you heard that someone had been arrested for road rage, it is overwhelmingly likely to be a man. The differences between men and women in terms of aggression is not as large as the difference between the number of men and the number of women who are likely to be in prison for a violent crime, because at the furthest extreme end, the majority of the most violent people in society are male.

Like the above examples, you are going to find that, on average, the outliers in terms of individuals pursuing a status-driven career to the top of a FTSE 100 company are mostly men. Women are, on average, less likely to be driven by status (and more power to them for seeing through the superficialities of status-mongering in my view), and are therefore less likely to be in the boardroom.

That may change - and boardrooms may benefit hugely from having far more female representatives - but I doubt it will change that much, because many smart people do not want to climb greasy poles, work 70-80 hour weeks, spend very little time with family and friends, and scale their career so far upwards that they end up sacrificing many of life's other rewarding pleasures. It is very likely the case that more of these smart people are women than men.

A close analogy may be in the school playground, where all the testosterone-filled lumps are trying to court the relatively empty prestige of being a star on the football field, while all the smart kids are sitting on the outskirts devouring calculus, chemistry and Cervantes.

Further reading on the fallacy of the so-called 'unfair' gender pay gap:





Saturday, 2 June 2018

Ask The Philosophical Muser: Reader Response To Trump & Tariffs


A reader asks about my recent post on Trump's tariffs:

"I don't get everyone's blathering about Trump issuing tariffs to help our domestic steel industry. The President of the United States has an obligation to the steel workers in the US not to steel workers in foreign countries. That's one of the basis on which he was elected, to compensate the home economy for it's (sic) losses"

My response:

Even if we ignore the central point of what I wrote - that Americans themselves are better off without the tariffs (and heaven knows why we'd ignore it, but let's do it anyway for the moment) - one of the rules of thumbs I find generally reliable is that if you transplant a proposition to analogous real life examples and find it doesn't fly analogically, there is a good chance that your proposition doesn't fly in the case you want it to either.

I will offer some examples. So remember the proposition here is that Trump should compensate domestic workers from the threat of foreign competition. So I ask you to think of one other instance in real life where we would countenance such an idea as a moral or rational equivalent.

When Tesco opens a superstore in a nearby town, we don't have an obligation to compensation the local high street businesses. When Amazon can deliver CDs and books to your door at the cheapest rate, we have no obligation to compensate HMV and Waterstones. When average looking Dave loses out to handsome Mike in the pursuit of Kerry's affections, we don't think they have an obligation to compensate Dave for remaining single. When more and more women began to enter the labour market, no one thinks that the government should have compensated men for the increased competition for their jobs. The list goes on.

Similarly, when Americans are made better off by foreign competition in the form of lower consumer costs, the fact that no analogous compensatory situation exists anywhere else in society speaks volumes about its absurdity. Foreign competition should no more be punished for entering the US economy and making Americans better off than increased competition from women, online traders and large supermarkets should be punished for making people better off.

Finally, as I said in a Facebook post in March, when Trump was first tweeting threats about tariffs against the EU:

"Trade is not like a race where you try to untie the laces of fellow competitors in order to make it harder for them to cross the line. In trade deals, the best situation for all the runners is everyone crossing the line together with their laces intact: that is, by all participants removing tariffs and subsidies. Trying to partake in a trade war with other countries by imposing tariffs is like trying to slow them down in a race by tying your own laces to theirs - you both become inhibited in trying to run."

And here is what so many don't understand about trade that they would understand with absolute clarity if it were a running race: even if others wish to run with their laces untied, you are still better off if you run with yours tied up, and encourage others to tie up their own laces and join you over the finish line.
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