This morning’s AM Reads included a post by Adam Ozimek at Modeled Behavior that suggests the NYC soda ban has had unintended consequences. He writes about a business owner who has thousands of dollars poured into large drink containers of which he will now have to rid himself. But isn’t that the point of the ban? How is expelling large containers from NYC not an obvious (and intended) consequence of a ban on such containers?
The debate over preferences for and the utility of large soda containers certainly has merit. It may be that a ban on serving drinks that have 25 calories per 8 ounces of liquid in a 16 or more ounce container is not optimal for the people of New York. Of course there are other options. Drink sales taxes by the ounce? Or perhaps by the calorie? The city could simply find the optimal level of taxation for achieving their desired consequence. This still means that Mr. Goldman from the Ozimek post overpaid for his soft drink containers; still, maybe he will save money in the long run when his friends and neighbors that are on the margin of debilitating obesity are able to remain in the workforce at some point in the future.
Only time will tell if Michael Bloomberg’s intended unintended consequence will actually make New Yorkers healthier.
seeks to enrich liberalism, and political discourse generally, with a deeper awareness of human nature.
Though, at least so far, I’ve been less interesting in Mr. Haidt’s descriptions of neuroprocesses and more in his commentary on philosophy. Perhaps I’ll update this when I’m done with more commentary on the book’s suggestions on that subject.
Nonetheless, the results of this paper imply that increasing cigarette taxes may be more effective in changing smoking behavior than implementing a ban. In the majority of the estimates, the magnitude of an increase in cigarette prices is larger and of greater statistical significance than any of the magnitudes for an individual ban or the aggregate effect of all three types of bans. Hence, increasing taxes appears to be more effective in reducing the number of smokers. This finding is especially true in analyses of current smokers and their attempts to quit smoking: In all models of smoking cessation attempts, the ban variables are neither statistically nor economically significant, but the price variables are.
Perhaps our most dangerous bias is that we naturally assume that everyone else is more susceptible to thinking errors, a tendency known as the “bias blind spot.” This “meta-bias” is rooted in our ability to spot systematic mistakes in the decisions of others—we excel at noticing the flaws of friends—and inability to spot those same mistakes in ourselves. Although the bias blind spot itself isn’t a new concept, West’s latest paper demonstrates that it applies to every single bias under consideration, from anchoring to so-called “framing effects.” In each instance, we readily forgive our own minds but look harshly upon the minds of other people.
It was a powerful notion, that our financial futures might be coded in our chromosomes. But it lay far outside the realm of what economists normally think about—such as how people respond to incentives and how they make decisions. Knowing about a person’s genes seemed like something else entirely.
Unlike typical government spending, tax expenditures aren’t reauthorized each year by Congress, so they have immense staying power. Because they aren’t as visible as outright spending, they aren’t subject to the scrutiny of campaigns to pare back waste or assess effectiveness.
For instance, you might think the mortgage interest deduction is a good idea. What if we changed the framing though, and made it an explicit government handout.
So would directly subsidizing behavior turn more policy makers against maintaining tax expenditures? How would Grover Norquist take this preference change?
The results also have potential practical applications in psychology and economics. They suggest that the ability to make sound empathic decisions might depend on the ability to compute value signals in vmPFC that give sufficient weight to the differences between others and ourselves. It follows that deficits in empathy and general social cognition might impair the ability to make sound empathic decisions, which could interfere with everyday social interaction. Additional evi- dence for the role of vmPFC in these types of processes comes from lesion studies (Krajbich et al., 2009).
Essentially the researches looked at the brain processes associated with making decisions for someone else with their money and how increased information about the other person’s preferences influenced the decider. Spending other people’s money with the goal of doing what is best for them… The implications for politics seem obvious.
Jake
Tyler
