Tag: prem panicker

In Which Jordan and Kohli Help Us Understand That Incentives Matter

That incentives matter is a given in principles of economics. I begin my courses on the subject by talking extensively about incentives – their etymology, their types (negative and positive, monetary and non-monetary), what happens if (when?) incentive design goes wrong, etc., etc.

By the way, did you know that the word incentives comes from incantations and chanting? True story!

But incentive design can be done for, or on, oneself too. And when done well, truly great things can happen.

Sarthak Dev, author of the excellent blog Lines On The Grass, tells us how by talking about two of my favorite sportspersons: Michael Jordan and Virat Kohli.

As anybody who’s watched the documentary series The Last Dance will tell you, Jordan says that he took it personally about fifty million times in that series. And that is probably an understatement.

But Sarthak points out, in his post, that this was just Jordan creating an incentive for himself. Playing at his very best, day in and day out, for as long as he did, cannot just have not been easy – it must have been impossible.

So how should he go about motivating himself? By picking a fight, of course. By imagining that the world was against him, or even better, by imagining that a specific person was against him, or had said or done something that was a “personal” insult.

This can be a coach on the opposing team who doesn’t say hello, this can be a trash talking opponent, or this can be an opponent getting an accolade that Jordan thought belonged to him.

Whatever.

The word “whatever” isn’t used in the colloquial sense here – I mean it literally. The specifics don’t matter, neither does the person, and as in the case of Bradford Smith, neither does reality. What matters is that Jordan was able to convince himself that an injustice had been done to him, and that this needed an express, extra-large delivery of vengeance.

Which, of course, Jordan delivered, year in and year out.

Me, the nerdy econ prof, I prefer to say that Jordan was designing incentives for himself.

And, you could argue, Virat is doing the same thing these days:

Taking a dig at his critics during the post-match discussions, Kohli said, “All the people who talk about strike rates and me not playing spin well are the ones who love talking about this stuff. But for me, it’s just about winning the game for the team. And there’s a reason why you do it for 15 years – because you’ve done this day in [and] day out; you’ve won games for your teams.”
“I am not quite sure if you’ve been in that situation yourself to sit and speak about the game from a box. I don’t really think it’s the same thing. So for me, it’s just about doing my job. People can talk about their own ideas and assumptions of the game, but those who have done it day in [and] day out know what’s happening, and it’s kind of a muscle memory for me now.”

I’m a Manchester United fan (about which we shall not talk, now or forever), and old enough to remember the famous siege mentality that Sir Alex was able to generate, time and again. But regardless of whether it is Jordan, or Kohli, or Sir Alex, all that they’re doing is creating incentives that work, for themselves.

There are two lessons here.

First, nothing stops us from creating these incentives for ourselves. Who better than us to know what will work in our case? Be warned, though, this is tricker than it looks. For while it is true that nobody knows us better than ourselves, it is also true that this makes it easier for us to ignore the incentives we have created for ourselves!

I can take pretend to take offense at person X for saying that I don’t write often enough on EFE, for example, and to “show him”, I can promise to write daily for the next seven years. But he, I and you – we all know that a “Chod na yaar” is in my destiny, sooner or later.

Second, yes, incentives matter, but so do opportunity costs:

Cricket did not start the day Kohli made his debut—I am no fan of the commentary on offer, but some at least of those commentators have been there and done that, maybe even better. I mean, you want to tell, say, Brian Lara that he doesn’t know what being out in the middle is like?

Someone should tell him that, besides the bad taste such comments leave in the mouth, he is merely leaving himself wide open.

You speak like this on the back of one innings in a winning cause, what do you suppose is going to happen the next time you fail, and/or your team loses—as will inevitably happen?

Tricky ol’ business, economics.

In which Alex Tabarrok and Prem Panicker Teach Us About the Overton Window

What is the Overton window?

Here’s ChatGPT:

“Range of ideas or policies that are considered acceptable and within the mainstream”.

I’ll give you two recent blog posts that speak about the Overton window without mentioning the phrase. The first talks about geo-engineering. The second talks about us Indians.

The good news is that climate change is a solved problem. Solar, wind, nuclear and various synthetic fuels can sustain civilization and put us on a long-term neutral footing. Per capita CO2 emissions are far down in developed countries and total emissions are leveling for the world. The bad news is that 200 years of putting carbon into the atmosphere still puts us on a warming trend for a long time. To deal with the immediate problem there is probably only one realistic and cost-effective solution: geoengineering. Geoengineering remains “fiendishly simple” and “startlingly cheap” and it will almost certainly be necessary. On this score, the world is catching up to Levitt and Dubner.

https://marginalrevolution.com/marginalrevolution/2023/07/superfreakonomics-on-geoengineering-revisited.html

Remember, the Overton window doesn’t say anything about whether you agree with the idea or not. Nor does it have anything to say about whether the idea is ethical or desirable. You may well disagree with the concept of geo-engineering; I personally do not. (By the way, as Alex points out in his post, carbon emissions themselves are a form of geoengineering!). Like the rest of the planet, I do not know how well it will work, what the consequences might be, and whether we should go ahead with it all guns blazing right away. But is it an idea worth exploring, is it something that should be on the table for discussion? One hundred percent yes, in my opinion.

And it is the fact that MR is talking about it, that the NYT is talking about it, that the White House is talking about it that makes it about the Overton window. Alex is making the point that this discussion would have seemed kooky to even talk about twenty (ten?) years ago – now, not so much.

Is that a good thing or a bad thing? The fact that it is now “acceptable” to talk about it? Each one of us gets to decide for ourselves, and that is how it should be.

How did we get from that to this?

How did we become a people so thoroughly inured to high crimes and misdemeanors that even a chilling, graphic video of women being stripped and paraded in public prior to their being gang-raped did not merit a single placard, a solitary candle lit in sympathy?

How did we become a people so anesthetized that our instinct in the face of heinous crime is to stand not with the victim but with the political party of our preference?

To misapply a quote: Gradually, then suddenly.

https://prempanicker.wordpress.com/2023/07/23/twtwtw-july-23/

What is the idea that we’re talking about over here? The idea (or the argument, if you prefer) that we have become anesthetized to heinous crimes.

Remember, the Overton window doesn’t say anything about whether you agree with the idea or not. Nor does it have anything to say about whether the idea is ethical or desirable. You may well disagree with the concept of us having become anesthetized as a people; I personally do not. (By the way, as Prem points out in his post, the anesthetization is wide-ranging!). Like the rest of the country, I do not know how well the anesthetization will work, what the consequences might be, and whether we should go ahead with it all guns blazing right away. But is it an idea worth exploring, is it something that should be on the table for discussion? One hundred percent yes, in my opinion.

Let me be clear: the idea worth exploring is the idea that we have become numb to horrific crimes. I think we have, because I do not see the same kind of outrage in society as with the Nirbhaya case. You may disagree, which is absolutely fine.

You could argue that we as a people have always been numb to rape being used as an instrument of oppression in various contexts. You could argue about the fact that “othering” has a long and tragic history across all of humanity, let alone India. You could point out a million (to our collective shame) incidents of similar or more horrific nature from our past (recent, ancient or somewhere in the middle, take your pick).

But we as a society – and that includes everybody who is Indian within it – we have never been as numb as we are today. Our anesthetization has never been as acceptable to us as it is today. We’re openly accepting of our anesthetization – that is the shifting of the Overton window here.

That is the claim that I think Prem is making, and I am inclined to agree.

Homework:

  1. Do you agree with the first, the second, both, or neither?
  2. Whatever your answer, why?
  3. Best of all, if you disagree with one and agree with the other, what changes in your analytical framework and for what reason(s)?

Answering these questions will help you become clearer in your own thinking, and I wish you all the very best 🙂