Author Archives: Joseph Heath

Vaccination is a collective action problem

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A couple of weeks ago I wrote a post about the difficulty many people have grasping the logic of collective action problems — where the outcome of an interaction is bad, but where no individual has an incentive to stop doing the thing that is leading to that bad outcome (here).

I’m reminded of this problem every morning these days, since vaccination has been in the news, first with the NHL players, and now with a measles outbreak in Toronto. The debate over vaccination is a perpetual source of frustration for me, because people insist on treating parents who refrain from vaccinating their children as irrational, whereas in most cases they are not being irrational, they are actually free riding, which is perfectly rational, in at least one sense of the term (i.e. the one used by economists). Thus they should be criticized for acting immorally, as opposed to irrationally.… Continue reading

Cynicism or stupidity? the eternal question

Posted by on | environment, politics

The other day, speaking in Davos, finance minister Joe Oliver expressed his commitment to maintaining a balanced budget in Canada. He described it in the usual terms, as an “ethical issue” having to do with intergenerational fairness. “We think it’s wrong to burden our children, our grandchildren with expenditures that we’re incurring today…”

Now as most educated people know, this is an economic fallacy. It’s not as though we’re eating in a restaurant en famille, then when the meal is done the parents skip out and leave the children to pay the bill. When the government borrows money, it creates both an asset and a liability, both of which get handed on to future generations, making it a wash as far as “our children and grandchildren” are concerned (e.g. some inherit the Canada Savings Bonds, and the revenue stream that goes with them, others inherit the tax liability associated with paying out that revenue).… Continue reading

Weekend tax policy reading

Posted by on | economy, taxation

Yes, the weekend is nearly upon us. Almost time to put your feet up, get a cup of coffee, relax and catch up on your reading — and what greater joy could there be but to dig into some cutting-edge thinking in Canadian tax policy? After all, don’t you care about social justice? And aren’t you tired of listening to Americans fighting about their tax system? Wouldn’t it be a refreshing change to listen to a sensible Canadian, making sensible recommendations for how our own income tax system could be made more efficient and more just? Well I have just the thing for you:

I read the notes to this speech by Kevin Milligan (UBC Economics) when he gave it in November, but only recently noticed that the official published version is much more elaborate: Tax Policy for a New Era: Promoting Economic Growth and Fairness, and really does offer one-stop shopping for all your tax policy needs.… Continue reading

Why people hate economics, in one lesson

Posted by on | economy, education

This is extraordinary. Alex Tabarrok and Tyler Cowen recently released a little promo video, to tout their new “Marginal Revolution University” course on microeconomics (as well as their intro textbook). In it they bend over backwards to make economics seem fun, friendly and non-intimidating. Practically every sentence is accompanied by a cutesy little animation, designed to make the study of economics seem as non-threatening as possible. And yet halfway through the video, they ruin it all, by saying something that is guaranteed to alienate most normal people. See if you can spot the faux pas:

I actually think the whole segment from 1:10 to 2:22 is fairly ill-advised, but there are two points where it’s terrible. (Summary, for those who don’t want to watch: They tell the story of how 19th century British sea captains transporting prisoners to the penal colony in Australia used to mistreat the passengers, resulting in very high mortality rates.… Continue reading

Canada’s worst policy ideas of 2014

Guest post by Daniel Béland, Rachel Laforest and Jennifer Wallner

When the Washington Post’s Wonkblog recently published a list of 11 of the worst U.S. policy ideas of 2014, we asked the question: what would the Canadian equivalent of such a list look like? To simplify the task, we looked at provincial and federal policy proposals officially promoted by a governing party. Here we provide a list of four policies – two provincial and two federal. While some may disagree with our picks – and the list is certainly not comprehensive – this exercise has clear value to stimulate debate about what good and bad policies are.

1. Charter of Values. An obvious contender for worst policy idea of 2014 is the so-called Charter of Values put forward by the PQ government in Quebec. An exercise in policy demagogy, the Charter of Values, and especially the proposed ban on all “ostentatious religious signs” worn by public employees, claimed to protect society against a widely inflated threat (religious accommodations).… Continue reading

On philosophical and economic illiteracy

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As I may have mentioned, I’m in the Netherlands this week, giving a paper at an Ethics and Economics conference in Utrecht. My paper (here) starts out by belabouring some of the issues that were raised by N. Gregory Mankiw’s much-derided attempt to defend the incomes of the top 1% (here). There was a huge amount of criticism piled onto Mankiw in the wake of this, but one of the things I noticed was that few economists challenged the most problematic feature of his argument – namely, that it is based on the zombie idea that paying workers according to their “marginal productivity” is equivalent to paying them the actual product of their labour, and therefore corresponds to some pre-theoretic concept of what they “deserve.” (According to this view, the marginal productivity theory of wages provides the foundations for a moral justification for the distribution of income under capitalism.) This is an argument that was bandied about a lot in the early 20th century (and given its most spirited defence by John Bates Clark in his 1899 book, on The Distribution of Wealth), and is almost universally regarded as having been defeated.… Continue reading

Academic roundup

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No blogging lately, not just because of the holidays, but also because I’ve been working on a number of different academic projects. Here is a quick set of links, for those interested.

First of all, a Habermas paper that I have been fiddling around with for a long time finally came out, in Philosophy and Social Criticism. It’s called Rebooting Discourse Ethics. The official version is gated, but the MS can be found here. Thanks to PSC for letting me go on at length!

I’ve also posted a series of papers that I’m working on over at my academia.edu page. The first, Why Do People Behave Immorally When Drunk? is coming out in Philosophical Explorations soon. I’m happy to see this one in print, as it was a huge amount of work. My co-author, Benoit Hardy-Vallée, wrote the first draft while he was doing a SSHRC post-doc with me at UofT maybe 10 years ago.… Continue reading

The inevitability of road pricing

Posted by on | economy

A friend came over to my house the other day driving a brand new Tesla. It was a sudden reminder that all this automotive innovation that we keep hearing about is actually happening. Just a few days previous, I had been watching this demonstration of Tesla’s new “autopilot” feature:

I have to say that, as someone who hates driving, watching the video below got me pretty excited.

I can’t recall offhand any piece of technology with the prospect of more dramatically improving my quality of life.

On the other hand, driverless cars have the potential to exacerbate a whole lot of other problems. The first is that, unless we make some changes in the way that access to roads is regulated, they will massively increase congestion. The economics of it are pretty simple. You can pay for roads in one of two ways, either with money or with your time. If use of roads is not priced, then there will be overconsumption, which will manifest itself in the form of congestion.… Continue reading

Hobbes’s difficult idea

Posted by on | environment, political philosophy

One of my favorite Paul Krugman papers is called “Ricardo’s difficult idea” — on why people have such a hard time understanding the concept of “comparative advantage.” Although the situation is not quite as bad, I’ve been struck recently by how much difficulty many people have trying to understand the concept of a “collective action problem.” Although that idea has a bit more history to it, I don’t think it’s too much of a distortion of the record to call this “Hobbes’s difficult idea.”

I was prompted to think about this a couple days back, when James wrote in the comments:

I think everyone can understand free rider problems, but almost no one bothers to think of the world in that way.

Sad but true. One of the things I’m constantly amazed by in discussions over climate change is how elusive the basic concept of a collective action problem remains, and how unintuitive it is for many people (whether to grasp, or just to apply, as James suggests).… Continue reading