April 24, 2005
Plagiarism--Posner Post
Recent “scandals” involving charges of plagiarism by professors and other writers treat plagiarism as (1) a well-defined concept that (2) is unequivocally deserving of condemnation. It is neither. Take the second point first. The idea that copying another person’s ideas or expression (the form of words in which the idea is encapsulated), without the person’s authorization and without explicit acknowledgment of the copying, is reprehensible is, in general, clearly false. Think of the remarkable series of “plagiarisms” that links Ovid’s Pyramus and Thisbe with Shakespeare’s Romeo and Juliet and Leonard Bernstein’s West Side Story. Think of James Joyce’s Ulysses and of contemporary parodies, which invariably copy extensively from the original—otherwise the reader or viewer would not recognize the parody as a parody. Most judicial opinions nowadays are written by law clerks but signed by judges, without acknowledgment of the clerks’ authorship. This is a general characteristic of government documents, CEO’s speeches, and books by celebrities.
When unauthorized copying is not disapproved, it isn’t called “plagiarism.” Which means that the word, rather than denoting a definite, well-recognized category of conduct, is a label attached to instances of unauthorized copying of which the society, or some influential group within it, disapproves.
In general, disapproval of such copying, and therefore of “plagiarism,” is reserved for cases of fraud. The clearest example is a student’s buying an essay that he then submits for course credit. By doing this he commits a fraud that harms competing students and prospective employers. Another clear example is the professor, or other professional writer, who steals ideas or expression from another professor or writer, and by doing so obtains royalties or tenure or some other benefit that he would not have gotten were the truth known—again, a case of fraud. It is less serious than the student fraud, however, because it is more likely to be caught. A student essay is not published and so will not be widely read. A published work is quite likely to be read or brought to the attention of the author of the purloined work. The easier it is to detect a wrongful act, the lesser is the punishment required to deter (most of) it; this may be why—to the outrage of students—plagiarism by faculty tends to be punished less severely than plagiarism by students. Moreover, whereas a student plagiarism has absolutely no social value, plagiarism in a published work may have such value. If what is plagiarized is a good idea, the plagiarism creates value by disseminating it further than the original author may have done. Moreover, the plagiarist may add his own input to the plagiarized idea and as a result produce a superior work.
I lumped together copying a professor’s work and copying the work of another type of professional writer, say a writer of popular history. In both cases, the copying will probably be a copyright infringement. In both cases, too, the copying will be a form of fraud. What will differ in the two cases is the injury that the fraud inflicts. In the case of the popular writer, the injury will be a loss of royalties or other fees—and will usually be negligible, unless the plagiarist is trying to produce a substitute for the work, rather than just enhancing a noncompeting work with incidental material from another book. The academic writer will usually suffer no loss of royalties even if the plagiarized work is a direct substitute, because few academic writings generate royalties (textbooks are the principal exception). But he may suffer grievously nevertheless, because recognition of original contributions is the key currency of academic reward and that recognition is blurred when someone fails to acknowledge another’s priority. The contrast in this regard with judicial opinions is very striking. Far from flaunting their originality, judges try to conceal it. They like to pretend that rather than making up new law, they are merely applying existing law made by others. So they do not complain at all if another judge or a law professor “steals” novels ideas that they have managed without acknowledgment to smuggle into some of their opinions.
Perhaps the most difficult current question about plagiarism concerns the “managed book,” or more broadly the use of research assistants or other aides in the creation of a book. The term refers to a book in which the nominal author is actually an editor—an assembler and maybe a reviser—of work done by persons whom he has hired. He is much like a movie director. He presides over the composition of the work rather than being the composer. The phenomenon is not new; according to An Unfinished Life, Robert Dallek’s recent biography of John F. Kennedy (a biography highly favorable to its subject, but not uncritical), Profiles in Courage was a “managed book” (not Dallek’s term, though). Many judicial opinions are of this character. It seems likely that many multivolume treatises by (that is, nominally by) law professors are “managed books” in which most of the actual writing is done by student research assistants—though I am guessing; I have no actual evidence.
Let me say, as someone who has written a number of books, that the idea of writing a “managed book” is not to my personal taste. I think that the person who writes a first draft largely controls the final product, even if it is carefully edited by the “author” of the managed book. But the issue of plagiarism has nothing to do with the taste of particular writers. It is an issue of fraud. So the question regarding the managed book is whether failure to disclose that most of the actual writing was done by persons other than the nominal author misleads readers to their detriment. That depends mainly on the conventions, and hence expectations, of a particular field. A professional historian who “authored” a managed book without disclosure of the fact would be committing a fraud because his fellow historians would think he’d written it himself. At the opposite extreme, few lawyers care whether a judicial opinion is written by a law clerk or by the judge, provided they think it’s the judge’s decision (the bottom line, the outcome), which it almost always is. In between is the legal treatise—the American legal treatise, that is; for it has long been the norm in Germany and other European countries for academic law books to be written by the assistant to the professor under whose name the book will be published. That is not the norm in the United States. I believe without knowing that the delegation of the writing of extensive portions of such works is recent, and much of the profession, including the treatise author’s colleagues, may be unaware of the trend—if there is a trend, of which I am not certain. It would be prudent, therefore, for such treatise writers to acknowledge the coauthoship or first-draft responsibility of their students, in order to avoid a charge of plagiarism.
Posted by posner at 7:51 PM | Comments (45) | TrackBack
Comment on Plagiarism-BECKER
Posner correctly argues that there is no hard and fast line that separates plagiarism from accepted use of other people’s written work. But wherever the line is drawn, plagiarism is the reverse of counterfeiting activities. Plagiarists try to take credit for the work of others, while counterfeiters credit others for their own work.
Both have been with us for a long time, but the internet and other new technologies have made both plagiarism and counterfeiting easier. A potential plagiarist has access through the internet to extensive written materials on any topic, while counterfeiters can discover designs and products to copy, and can find customers through email and websites. It is also more difficult to detect plagiarists and counterfeiters since the number of potential sources for reports and other document to the plagiarists is immense, as are the outlets for counterfeiters.
A well-recognized part of the theory of deterrence of illegal and other undesirable activities is that punishments should be greater when the likelihood of detection is smaller. So it follows that since these technologies have made plagiarism much easier, and its detection more difficult, punishments of plagiarists should be greater than in the past.
Posner discusses the damage from plagiarism by students and professors, and appears to conclude that punishment should be less severe on professors caught plagiarizing than on students. I share his concern about plagiarism, but do not agree with this conclusion. Plagiarism by professors and other writers makes greater use of the work of others than does plagiarism by students. As Posner notes, this provides an incentive for authors to discover professors and other writers who plagiarize since citations of one’s work is the major way to gain a reputation in academic fields, and sales is the source of income to professional writers.
But the analysis of deterrence implies that punishment should be directly related both to the magnitude of the gain from an illicit activity, and the extent of knowledge about whether it is illicit. On both issues, professors are more culpable than students. A professor who succeeds in plagiarizing typically gains far more from this than a student who plagiarizes in preparing say a term paper. The student may get a higher grade, while the professor helps his chances of getting tenure, promotions, and raises. In addition, professionals know much more than students do about the distinction between plagiarism and simply relying on the contributions of others.
This is why I side with students who believe that professors discovered to have plagiarized are typically let off too easily. They should be fired for clear-cut and flagrant plagiarism. Unfortunately, that does not usually happen if they are in senior positions because that means revoking their tenure, which is usually vigorously opposed through litigation and other means. In particular, The American Association of University Professors, a kind of union of professors, has opposed with almost a religious fervor all attempts to revoke tenure of faculty except for the most dismal behavior, defined in part by what is politically incorrect at the time.
To return to counterfeiting, companies that produce clothing with unauthorized labels of famous designers, watchmakers who falsely claim their watches are Rolexes or other expensive brands, or private producers of $20 bills pretend to be other producers in order to free ride on their reputations and markets. These and other examples of reverse plagiarism are clear violations of patent or copyright law even when the counterfeit product is just as good as the original, which it often is not.
I mentioned earlier that production of counterfeits has become easier because of the internet and other technologies, while detection is more difficult also because of these technologies. Detection is also more difficult because markets have become more global. These changes imply that punishment of counterfeiters should be harsher than in the past. However, globalization often makes it harder to punish producers of counterfeit products since developing countries do not really want to enforce the copyright and patent protection on products made elsewhere.
Posted by becker at 7:43 PM | Comments (10) | TrackBack
April 23, 2005
Small Countries--Posner Response to Comments
These were interesting comments. One that particularly struck me is that a small country may lack enough human capital to man key offices in government, universities, the professions, and businesses optimally. Suppose that there is a threshold number required to manage even a small government, university, etc. and that the percentage of people qualified for these managerial positions is very small. That is not a problem for a large country but can be one for a small one. It might follow that outstanding institutions would be found only in large countries. One answer is that small countries can frequently free ride on the institutions of the large countries--even in government, by joining a federation or confederation.
A question was raised concerning my statement that Pakistan had split in two--the questioner thought I might have meant India. British India indeed split, in fact into four pieces--India, Pakistan, Burma, and Ceylon (Sri Lanka). I was (as another comment notes) referring to the fact that Bangladesh used to be East Pakistan but became independent after a war between India and Pakistan.
Posted by posner at 10:21 PM | Comments (1) | TrackBack
April 22, 2005
Response on Small is Beautiful-BECKER
A few comments.
Being small has some disadvantages in international negotiations, but mainly small countries slip through the cracks of various barriers and obstacles.
The WTO and monetary unions among small nations certainly is often part of the explanations why being small is not as disadvantageous as in the past, and has certain advantages.
True, a homogeneous culture may help a nation integrate, but countries splitup typically because the cultures are different and sometimes clash. Examples include Yugoslavia, the Serbs and Czechs in the former Czechoslovakia, Ukraine and Russia, and so forth. Splitting up enables them to engage in trade and movement of capital and people without cultural, religious, or ethnic clashes getting in the way.
I will stick by my analysis of East and West Germany. If they had stayed independent, wages would have fallen in the East. Of course, some young people would have moved to the West-they do anyway! But new companies would have started attracted by the low wages, and these wages would also have attracted companies from other nations, especially West Germany, if the labor environment more generally was attractive. To be sure, the 1-1 exchange of currencies was politically necessary, given integration, but isn’t this political necessity another reason why integration was a bad idea from an economic viewpoint?
International trade grew partly because of the growth in nations, and partly because trade increased between nations. But as you realize, the large growth in U.S. exports and imports is an indication of the general growth in international trade. This is one of the important factors that made small nations more viable economically.
Posted by becker at 9:13 PM | Comments (4) | TrackBack
April 17, 2005
Why Small has Become Beautiful-BECKER
In the Federalist papers, Alexander Hamilton argued for the proposed U.S. Constitution that gave the federal government great powers because he claimed large countries with strong central governments have freer internal markets, can better deal with foreign aggression, and can raise taxes more easily to pay for needed government services.Yet since 1946, the number of countries has grown from about 76 to almost 200. Some of that growth has been due to countries gaining independence from colonial powers, such as India or Zaire. Others resulted from a subdivision of countries into smaller units, such as the breakups of Czechoslovakia into the Czech Republic and Slovakia, or of Yugoslavia into several independent nations. Agitation to form independent nations continues in all regions of the world.
Has this splintering into smaller nations, often due to nationalistic aspirations, lowered their economic efficiency? My conclusion is that developments in the global economy during the past 50 years have greatly reduced the economic disadvantages of small nations enumerated for his time by Hamilton. In fact, being small now may even have efficiency advantages. This would help explain the splintering of nations along ethnic, religious, linguistic, and geographic lines.
In the past, larger nations generally provided bigger domestic markets with relatively low barriers to movements of goods, services, capital, and labor. By contrast, tariffs, quotas, capital and immigration constraints severely limited the movement of goods, capital, and people across national boundaries. But many of these barriers have come tumbling down as international trade has boomed for the past half century, propelled at first by GATT and then by the World Trade Organization (the WTO). Members of the WTO are forced to have low tariffs and quotas on import of most goods and services, and to some extent, on capital as well. As a result, world imports and exports have grown since 1950 at the remarkable rate of about 10 per cent per year
In other words, small countries can now gain the advantages of large markets through trading with other nations. So it is no surprise that international trade generally constitutes a larger fraction of the GDP of small nations than of large ones. For example, exports in 2004 relative to GDP are about 10 per cent for the United States compared to 37 per cent for Iceland. Most poor nations that experienced rapid economic growth during the past four decades also were extensively involved in international trade. This is true not only of the Asian tigers- South Korea, Taiwan, Japan, Singapore and Hong Kong- but also of Chile and Mauritius. These are all small except for Japan. In addition, much greater use of international trade helped rescue the two giants, China and India, from their long economic sleep.
Smaller nations even have some advantages in a world with much international trade. Their exports are too little to be considered a threat to other nations, so they are not subject to as many barriers as those from large nations, They often specialize in niche markets that are too insignificant, or not accessible, to large nations. For example, the tiny principality of Monte Carlo with about 5000 citizens has become a tax haven and gambling center for rich sports stars and other wealthy individuals. Singapore and Hong Kong have been mainly trading centers for shipments of goods to their much larger neighbors. Mauritius has succeeded by concentrating on textiles and tourism.
Apropos of Hamilton’s other arguments, small nations can now free ride on the military umbrella provided by the United States, NATO, or the United Nations. Small nations may still be at a disadvantage in providing other government services, but powerful groups in large nations often use the economies of scale in raising taxes and dispensing subsidies to exploit weaker ethnic, national, or economic groups. Smaller nations are usually also more homogeneous, so the powerful interests there have fewer other groups to exploit.
Tariffs and quotas on foreign producers impose a relatively big economic cost on small countries since they have little influence over the international prices of imports and exports. This cost reduces the ability of domestic producers to get politicians and voters to go along with their efforts to weaken competition from producers in other countries.
The economic consequences of the reunification of East and West Germany demonstrate some of these advantages of being smaller. East German productivity was much below that in West Germany when the communist government was overthrown. Economists both inside and outside of West Germany warned against the consequences of both exchanging one East German mark for one West German mark, and preventing East German wages from falling much below those in West German. The result not surprisingly has been very high rates of East German unemployment- still around 20 per cent- with the unemployed and others supported by massive financial transfers from West German taxpayers. These transfers more than a decade after reunification still amount to 4 per cent of total German income.
Both Germanies would have been better off economically if East Germany remained independent, and had an agreement with West Germany for free movement of goods, people, and capital across their borders. Wages in the East would then settle at a fraction of those in the West to reflect the lower productivity of East German workers. These low wages would attract companies from Germany and elsewhere to outsource some activities to the East that would provide jobs and raise employment and wages. Unfortunately, the prospects of attracting investments in East German have worsened with the expansion of the EU to include central European nations, like the Czech Republic, Slovakia, and Poland, with much cheaper, and less unionized, labor.
The split into the Czech Republic and Slovakia about a decade ago is also instructive. There was concern then that Slovakia would have trouble going it alone because they received transfers from the richer Czech region, and because many powerful leaders in Slovakia were ex-communists. But economic pressures forced a much more realistic assessment of what they needed, so Slovakia threw the communists out of power, and prospered by reforming rapidly toward a freer market economy.
My conclusion is that economic consequences no longer discourage secessionist movements that are driven by hostility among different religious, ethnic, linguistic, and other groups. This explains the continued secessionist pressure in some countries, such as the recent call by the main leader in the Basque region of Spain for a referendum there on whether they should become more or less completely independent from the rest of Spain. They already have considerable autonomy, so this example shows that giving power to regions is an imperfect substitute for full independence. Political pressure remains strong among French Canadians for Quebec to become independent from the rest of Canada, although this sentiment is weaker than a decade ago as Canadian regions have received greater autonomy. Many Kurds in Iraq, Iran, and Turkey still dream of an independent Kurdistan. The Tamils in Sri Lanka, and different groups in Indonesia continue their fight for independence. And is it any surprise that most Taiwanese do not want to become part of a greater China, despite growing threats from China?
Mainly due to the growth of the global economy and globalized trading, the evidence is overwhelming that small nations can now do very well economically, perhaps better than larger ones. In light of this evidence, it is surprising how many people, including economists, continue to believe that their economies will be ruined if secessionist movements succeed.
Posted by Gary Becker at 11:32 PM | Comments (16) | TrackBack
The Size of Countries—Posner’s Comment
I agree with Becker that the costs to nations of being small have declined and that this decline, along with the dismantling of the colonial empires (mainly of Great Britain and France), are factors in the growth in the number of nations since World War Two. I am going to focus, however, on the benefits side of nation size. Even if the costs of being small decline, unless there are benefits to being small one would not expect the decline to affect the number of nations, especially if we assume as we should that there are significant transitional costs to splitting up a nation.
The question of what determines the size or scope of a nation has parallels concerning the size of business firms and other private and public organizations, and even the size of animals. In the case of a firm, size is determined mainly by the relation of size to average cost. When the firm is very small, an increase in its size, by permitting greater specialization of its workforce, is likely to reduce the average cost of the firm’s output and thus make it more competitive. But beyond some point the gains from specialization will be exhausted and average costs will begin to rise because of increased costs of control. Effective control of a huge firm may require multiple layers of hierarchy, slowing and distorting information flows, although decentralization, as in a multidivisional firm like General Motors or General Electric, may enable the number of layers of supervision, and the associated costs, to be minimized.
Economies and diseconomies of scale (or scope—roughly, cost as a function of the number of products a firm produces as distinct from the quantity it produces of a single product) in the conventional economic sense also play a role in the determination of the size of countries. But other factors play a role as well, such as the advantage of size in defending against other nations. Here the analogy is to animals. Large animals are less vulnerable to predators than small ones are, and as a result tend to survive longer. (I am speaking of the individual animal, not the species.)
Historically, size has been enormously important to national survivorship. The nations that have disappeared completely, such as Prussia, Burgundy, the Republic of Texas, and the countless small kingdoms and principalities in Italy and Germany before the unification of those nations in the second half of the nineteenth century, have generally been small countries, though Becker is correct to note the continued survival of tiny “niche” countries, such as Monaco; this suggests that there is no minimum efficient size of a country, as there is of a steel producer. Large nations, however, have frequently fissured, such as Austria-Hungary and the Soviet Union, suggesting the existence of diseconomies of scale in the “market” for nations. Pakistan, a large but noncontinguous state, split in two. South Africa lost Namibia, Indonesia lost Papua New Guinea, Ethiopia gained and then lost Eritrea, and so on. What is new is that smallish nations, like Yugoslavia and Czechoslovakia, have also split; nevertheless, the splitting of small nations remains an infrequent phenomenon.
As Becker explains, with free trade the gains in specialization to a nation from having a large internal market diminish. And changes in military technology have reduced the military value of a large population, though not of a large GNP, which is a function in part of population. Nevertheless, if one glances over the entire history of nation formation and dissolution since the middle ages, one sees that the decisive factor has been the rise of nationalism. Nationalism is the belief that national boundaries should follow the contours of a “nation” in the sense of a population that has a common language, race or ethnicity, religion, historical origin, or culture, at least if that population lives in a contiguous area rather than being a diffuse minority in a larger polity, as some “nations” in the sense just defined, such as Jews and Armenians, are. The territorial nations of Israel and Armenia are limited to the areas in which the members of the ethnographic nation inhabit a compact, contiguous geographical area.
The greater the differences—in values, skills, language, and so forth—between two “nations” that inhabit adjacent territories, the fewer their common interests, and this complicates governance if they are made parts of a single territorial nation, in much the same way that corporate governance would be complicated in a firm that sold life insurance, diamonds, and hubcaps. The added costs may be offset, however, and in the nation case by defense considerations as well as by economic ones. If barriers to trade make large internal markets important for economic growth, then different “nations” in the ethnographic sense may share a single territorial “nation.” As those barriers recede and the military value of a large population declines, we can expect the nationalist principle to prevail. But this need not necessarily result in smaller nations. The mergers of the two Vietnams and of the two Germanies, and the reincorporation of Goa into India and Hong Kong into China, are examples of post-World II Two boundary changes that have increased the size of nations. (And in all likelihood someday the two Koreas will be united and Taiwan will be absorbed into China.) It may be an accident that the number of nations in the world has increased since the World War II. The number could have declined if more ethnographic nations had been divided up among different territorial nations rather than being combined in single territorial nations.
The merger of the two Germanies may have been an economic mistake, as Becker persuasively argues. But the diseconomies of scale in a nationalistic state, that is, a state with a homogeneous population (despite its racial, religious, and cultural heterogeneity, the U.S. population is homogeneous compared for example to Belgium, with its sharp regional division between French-speaking and Dutch-speaking populations, or even Switzerland), are small within a broad range. For just as a business firm can minimize diseconomies of scale and scope by decentralization, so a nation can greatly reduce those diseconomies by federalism. As a result, a large nation like the United States is able to compete economically with much smaller nations. In addition, its population size and consequent aggregate wealth enable it to achieve great military power, which prosperous small nations cannot do.
The analysis is incomplete, however, because one observes that many adjacent nations having a common language and culture do not merge: the U.S. and Canada, for example; Mexico and the other nations of Central America; the Spanish-speaking South American countries; Germany and the German-speaking Swiss cantons; and the Arab nations of the Middle East and North Africa. The explanation offered by Adam Smith for the American Revolution may have general application: within each ethnographic nation there is a governing class that anticipates greater benefits from ruling its nation than from sharing power with other elites within a broader territorial union.
Posted by posner at 11:24 PM | Comments (12) | TrackBack
April 10, 2005
The Sexual Revolution
The death of Pope John Paul II is a reminder of the profound changes in sexual mores over the past half century in the United States and many other countries, of the Pope’s strong defense of conventional Roman Catholic sexual morality (including opposition to abortion, contraception, married priests, and all nonmarital sexual activity, including homosexual sex and even masturbation), and of the growing gulf between that morality and the actual sexual behavior of Roman Catholics in the United States (which is, on average, similar to that of other segments of the community), including the recent sex scandals involving the priesthood.
Let us consider first why sexual morality has changed so much over the past half century. If one takes an economic approach to the question, then since the benefits of sex in the sense of the pleasure or relief of tension that it yields have deep biological roots, it is probably to the cost side that we should look for an answer. The costs of engaging in sexual activity have fallen dramatically over the last half century (AIDS notwithstanding), for many reasons. One was the discovery that penicillin is a safe, certain, and inexpensive cure for syphilis. Another was improvements in contraceptive technology that have greatly reduced the likelihood of an unwanted birth (with minimal interference with sexual pleasure). It is true that the number of unwanted births has risen, but this is because other factors influence that number besides contraceptive technology. And to the extent that improved contraceptive technology induces more sexual activity by making sex safer, the number of unwanted births will not fall by the full percentage reduction in the probability of such a birth; the reduced probability per sexual act is somewhat offset by an increase in the number of acts. Legalizing abortion has further reduced the risk of an unwanted birth, although legalization can be viewed as a response to, rather than a cause of, a change in sexual mores—or more plausibly as both.
Of fundamental importance is the changing role of women in society. The rise of the service economy, with its abundance of physically light jobs, together with the advent of highly efficient household labor-saving devices, has greatly increased women’s job opportunities outside the home. That increase has in turn increased women’s financial independence and thus reduced the gains to them from marriage. It has also increased the opportunity costs of childbearing—the higher a woman’s income, the more she gives up if she leaves the labor force, whether temporarily or permanently, to have children. So this is another factor raising the cost of marriage to women.
The consequence of all these things has been to reduce the marriage rate and delay the average age of marriage, and also to reduce the cost of divorce to women (and to men, by reducing the benefits of marriage to men who want to have children and stay-at-home wives). With less and later marriage and more divorce, women spend less of their sexually active years married and so their demand for nonmarital sex—sex made in any event less risky by improved contraception and the availability of abortion—soars.
The increased demand for divorce was a factor in the successful movement for easy divorce, and easy divorce makes it impossible to channel sex into marriage. In communities (and there are still some) in which premarital sex is strongly disapproved, young people marry to have sex, but marriages so motivated are likely to end in divorce, producing more unmarried people and so more demand for nonmarital sex.
Another factor that influences behavior in the same direction, though one that predates the developments that I have just been discussing, is the long-term decline in child mortality, as a result of which it is no longer necessary for women to be almost continuously pregnant in order to have a reasonable number of children survive to adulthood. In addition, with the decline of the farm population and the rise of social security, children’s value as farm labor and old-age insurance diminishes, and as a result the demand for children falls.
With more and more sex taking place outside of marriage, homosexual activity comes to seem less anomalous than in a society in which almost all sexual activity is (or at least is believed to be) confined to marriage. That is, once the link between marriage and sex is weakened, and sex comes to be thought of as worthwhile in itself rather than just as a means of procreation, nonprocreative sex—of which homosexual sex is a conspicuous example—begins to lose its opprobrium.
It may seem paradoxical to suggest that marriage and homosexuality are somehow linked; but they are. In societies like that of ancient Greece, in which men are expected to marry in order to procreate but are not expected to establish an intimate emotional connection with their wife (for example, in ancient Greece husband and wife did not eat together, and the wife rarely was even permitted outside the house), it is not difficult for homosexual men to marry. But when companionate marriage becomes the norm—when men are still expected to marry but marriage connotes much more than occasional intercourse—homosexual men become anomalous; the institution of companionate, as distinct from patriarchal, marriage tends to extrude them from a fundamental social institution. Companionate marriage is still the marriage norm, but fewer people are married, so unmarried men are less conspicuous.
The major Western religions, especially Christianity, and within Christianity especially Roman Catholicism, are increasingly defined by their opposition to the modern loosening of sexual mores. This is not because these religions have become increasingly prudish (though Catholicism takes a harder line against abortion than it did until the nineteenth century, and though a concern with sexual conduct plays a notably small role in the New Testament), but because their teachings on sex have become ever more removed from the behavior of their votaries. Pope John Paul II seemed unusually conservative in matters of sex not because he was making Catholic sex doctrine more severe, but because he was refusing to yield to strong pressures to relax it. He was swimming against the tide. Even though the United States is in the midst of a very striking religious revival, religion’s grip on behavior has weakened. Hence the contrast between vastly increased tolerance for homosexual behavior and powerful opposition, much though not all of it religiously based, to gay marriage. Hence, too, the great difficulty the Catholic Church is having in attracting young men into the priesthood, especially young heterosexual men—an all-male occupation holds obvious attractions for homosexual men, especially if the behavioral constraints of religious doctrine are weakening even for persons who desire a religious career.
To the extent that as a result of economic and technological change, sex ceases to be considered either dangerous or important, we can expect it to become a morally indifferent activity, as eating has mainly become (though not for orthodox Jews and Muslims). At this writing, that seems to be the trend in many societies, including our own. This is not historically unprecedented; many cultures have been far more casual about sex than our own—ancient Greece, for example.
I emphasize that this has been an essay in positive rather than normative moral theory. My concern is not with whether the changes in sexual mores that I have been discussing are right or wrong, but with trying to explain what has brought about the changes. I believe they can largely be explained in economic terms.
Posted by posner at 8:22 PM | Comments (235) | TrackBack
COMMENTS ON THE SEXUAL REVOLUTION-BECKER
Pope John Paul II was conservative on family matters, but was highly innovative on more important questions for the Catholic Church in the long run. These include his early, continued, and open hostility to communism when many intellectuals and some church leaders were supportive or accommodating, his steering of the clergy in Latin America and elsewhere out of active involvement in politics, his much more favorable attitude to capitalism than his predecessors, his rapprochement to the Jews and Moslems, and his commitment to peace, even when he differed with America and other powerful nations.
This explain the world-wide outpouring of grief over the Pope’s death, including the vast majority of Catholics who were violating church doctrines on contraceptives and divorce. He will be long remembered for these enormous contributions, whatever happens to the sexual revolution.
I start this way in my comment on Posner partly to express the high regard I have for Pope John Paul II (I should make clear that I was elected to the Pontifical Academy of Sciences while he was Pope). A reason more directly relevant to our topic this week is that the conflict between the actual behavior of most Catholics, and the Church’s doctrines on contraceptive use and other family matters, is not unusual when dealing with culture and norms. Indeed, it dramatically illustrates the fact that powerful economic and social forces usually trump religious views and other social norms, until these views and norms adjust to the new forces. Birth rates, divorce, and pre-marital sex provide a powerful example of this well-known principle.
For many reasons, most mentioned by Posner, families in modern countries generally have few children, and instead invest a lot in the education, training, and health of each child. These reasons include the high value of human capital in technologically advanced economies, low rates of child mortality, the growth of female education, earnings, and labor force participation, and the decline of manufacturing and rise of the service economy. Among other things, these forces increased the financial independence of women that gave them a greater say in family matters, and made them much more willing to divorce than in the past.
As a result of these forces, the vast majority of families in the world have fewer than three children. There is no effective way to do this, while continuing normal sexual activity, without extensive reliance on effective contraception. So as economic development has spread throughout the world, family after family, regardless of their religious views, have greatly increased their contraceptive use in order to have fewer children. Birth rates in Spain, Italy, Poland, and other predominantly Catholic countries are among the lowest anywhere. Ireland is the most religious country in the Christian world by virtually all measures of religiousity, yet Irish families are using contraception extensively. Their birth rates have plummeted, even while they loved Pope John Paul II, and remain highly devout Catholics. Clearly, these families are separating their decisions about contraception from their degree of religiousity.
Low birth rates were made easier by better and more efficient contraceptives. The attractiveness and effectiveness of condoms continued to improve throughout the past 80 years. The pill, the most effective method of birth control, was developed only in the 1950’s. Abortion became safer and legal in growing numbers of nations. The legalization of abortion illustrates that it is difficult to be certain about how much of the improvement in birth control methods were a response to pressure from families wanting few children, and how much was due to technological innovations that proceeded largely independent of such demand.
Whatever the causation, better ways to prevent births became available not only to married couples, but also to their teen-age children. The rapid growth in pre-marital teenage sexual activity not only in the United States, but also in many other nations, is the strongest manifestation of the “sexual revolution”. Teenagers could now explore sex without much fear of pregnancy, a fear that was a major form of “birth control” in the past. Surveys on premarital sexual activity among American 19 year old females indicate that the fraction that had engaged in pre-marital intercourse grew from about 25 per cent in 1950 to around 80 per cent currently. The number of sexual partners women had by age 20 also increased greatly.
Data further indicate that the larger numbers of teenagers engaging in pre-marital intercourse know more about and have easier access to effectives contraceptives than did sexually active teenagers in the past. About 60% of the women in 1960 who engaged for the first time in premarital intercourse used no contraception, while condoms were used 20% of the time. By the mid 1990’s, about two thirds used either condoms or the pill.
Yet even in recent years, a quarter of teenage women who engage in intercourse for the first time use no contraception. This is a larger fraction of all teenagers than the total fraction of teenagers in 1950 who engaged in pre-marital intercourse. So the sharp growth in sexual activity among young persons was not simply due to better and better-known contraceptives, but also to a greater willingness to engage in sex prior to marriage. This is strong evidence that the sexual revolution led to a much more permissive and receptive attitude toward sex outside of marriage even without birth control, although abortion is now an option for many women.
Events such as economic growth and new technologies often induce changes in behavior despite prevailing norms that initially oppose this behavior. As this new behavior becomes more common and habitual, norms evolve to catch up to the behavior. This adjustment of norms to behavior rather than simply visa versa is widespread, including attitudes toward sex, divorce, women’s work, husbands helping out with child care, and children support of elderly parents. Time will tell whether the attitudes of the Catholic Church on sexual matters will also evolve, but I believe that the Church will still be attractive to many Catholics even if their behavior violates Church teachings on questions like contraception.
So it is possible to understand the basis of the sexual revolution using an “economic” approach, but the approach must recognize that norms and habits are also important. These norms and habits usually adjust eventually to new forms of behavior, and the new norms greatly accelerate this behavior after they do adjust.
I disagree with Posner that sex will become, either morally or in other ways, just another consumer activity, like eating. Sexual intercourse is a very intimate relation between two people that grew as humans evolved during the past 50,000 years when they apparently began to separate into families. This relation carries a lot of emotional attachment and baggage that will not vanish simply because contraceptives are effective and birth rates are low.
Posted by becker at 6:08 PM | Comments (61) | TrackBack
Resonse on China's Economic Future-BECKER
Thanks once more for interesting comments. I have a few reactions.
I argued in my entry that it was in the interest of a country like China to pay little attention to intellectual property rights since it is a net importer of knowledge. I suggested this will change not only because of WTO pressures, but also because as China continues to grow, it will be producing more knowledge itself, and would then have more incentives to protect knowledge. I was well aware of American violation of European intellectual property rights during 19th century.
The rural countryside is poor protection for unemployed urban workers since farmers are still dirt poor compared to urban workers. That is why there is such strong pressure for rural persons to move to cities, a pressure that the present regime is trying to slow down.
I agree the absorption of East Germany in a very inefficient way, such as the one for one exchange rate between eastern and western marks, hurt the German economy. But many of its problems in labor markets and elsewhere really are independent of this, and Germany was already slowing down before the absorption.
To be sure, the size of China is important for many questions of trade and global military influence. And the aggregate GDP of China is likely to become the world’s largest before long since its population is so large. But surely per capita GDP is the relevant measure for understanding what is happening to the economic well being of the typical individual?
The evidence supporting the causation from economic growth to greater democracy is not based on a single study, but a history of studies for the past 40 years. I know of no respectable recent evidence that overthrows this conclusion.
It is not true that I neglected civil rights. I did discuss the authoritarian regime of China, the greater freedom to farmers, the freedom to change jobs, etc. I could have added greater access to computers, internet, etc, although a lot remains to be done before China is a free society by any standard.
I am not familiar with Slate’s criticism of de Soto. I believe he has done very important work on the underground economy, and his emphasis on the latent property of the poor is a keen insight. However, he carries that insight much too far. Bad property rights are a real problem in many countries, but China is a good example of a country that is growing from poor income levels at a rapid rate with weak property rights. I do not believe the poor of Latin America-de Soto’s example-have a lot of property, even if they had rights over all of it.
I do not know Barnett’s work, but I will try to look into it, and see if it justifies a topic.
Posted by becker at 11:34 AM | Comments (5) | TrackBack
April 3, 2005
Will China Become the Leading Nation of the 21st Century? Perhaps Not!-BECKER
NOTE: Posner and I believe that we should place more emphasis on events of interest to the international community. So we will discuss international issues more frequently, starting with our entries on China.
China’s economic growth since it freed agriculture from the oppressive hand of government has been spectacular, averaging some 7-10 per cent per year in real GDP since 1980, even allowing for some inflation in the official numbers. It has becoming a leading destination of foreign investment, one of the world’s biggest exporters, and among the largest users of oil and other natural resources.
Its potential seems to be so limitless, after awakening from a slumber that lasted for centuries, that many are already forecasting that China will replace the United States during the 21st century as the leading economic power. Perhaps these forecasts will be correct-my crystal ball is very cloudy- but some cautionary comments are needed because we have heard that tune before.
The “German miracle” after World War II was so impressive that many forecast Germany would overtake the United States rather quickly, in part because Germany supposedly discovered a new way to organize economic society- a “ social contract” among workers and companies- that would propel that nation past America’s old fashioned capitalism. But Germany began to flounder in the 1980’s, did much worse in the 1990’s, and is considered by many now to be the “sick man” of the European Union.
Krushchev’s prophesy in the late 1950’s that the USSR would “bury” the US was not about military victory but economic superiority. This was made when Soviet official statistics showed extremely rapid economic growth. The apparent miracle of Soviet growth suggested to the great economists Joseph Schumpeter and Paul Samuelson, and many others that central planning might be superior economically to capitalism and decentralization of economic power.
The latest case prior to China is Japan, which experienced impressive economic growth from the early 1950’s into the late ‘80’s that propelled Japan into the elite club of the richest economic powers. Japan too had supposedly discovered a new approach of consensus capitalism with a long-term business outlook that was allegedly superior to old Adam Smith varieties of competitive capitalism. This alleged superiority of the Japanese system was extolled in a series of articles by the very good economist Alan Blinder, and in books with various titles, such as “The Japan That Can Say No”. Yet Japan basically stagnated since the early 1990’s, and now the concern is whether it can ever come out of this stagnation and deflation (I am confident it will eventually). It’s economic model now seems riddled with inefficiencies and drawbacks, and is no longer considered a new wave of capitalism.
None of this proves that China will not be an exception, and continue to grow well beyond other nations, but these examples do suggest caution in conceding the next 50 years or so to China’s economy. Countries invariably discover that it is much easier to grow rapidly when they are economically way behind since they could then import the knowledge embodied in technology and human capital developed by leading countries. As a country begins to catch up to the knowledge frontier, a simple transfer of knowledge is no longer productive. It then has to participate in the generation of new technologies and approaches, which is far harder than simply using advances made elsewhere.
To be sure, China has considerable strengths that should enable it to grow relatively rapidly for much longer. China has an abundant, hard-working, and ambitious labor force. The government also radically liberalized the incredibly rigid labor markets under its old style central planning toward flexible markets that allow companies to hire and fire easily. Also workers now have the freedom, they did not before, to find jobs that best suit their talents and interests. China has opened its economy to foreign investments and domestic entreprenuers, something the Soviet Union, Japan, or even Germany never really did, and China has been learning from the new technologies brought by these investors.
China has also created a highly competitive environment in most markets, where companies have flexibility to change prices as costs change, and as competitors alter their prices and terms of sale. China’s long history of great respect for knowledge and scholars has returned. Even poor families now sacrifice their meager resources to insure their children a decent education and other investments in human capital.
During the past couple of decades, China has been blessed with far-sighted leaders that have generally wisely approached liberalizing its economy. They started off with relatively simple steps that gave farmers greater freedom to decide what to produce on their small private plots, and to sell their output at more market-based prices. After seeing the overwhelming success of these first steps, they gradually liberalized much of the rest of the economy, allowing workers freedom to choose jobs, employers freedom to determine hiring and firing, markets freedom to set most wages and prices, foreign investors to start factories, often in partnership with local governments, and stock exchanges to develop in Shanghai and elsewhere. Meanwhile, the mainland has largely lived up to its agreement to give considerable economic autonomy to Hong Kong.
This rapid development of the Chinese economy has provided many benefits to the US and other rich economies. Chinese has exported clothing, toys, simple electronics, and many other labor-intensive goods at prices far below those possible without China’s development. China’s growth helps provide a much larger and richer market for the knowledge-intensive products and services produced by rich nations, such as cars, computers, drugs and medical instruments, kitchen appliances, and many others.
China’s development so far poses economic problems mainly not for the advanced nations, but for developing nations that produce the same types of labor-intensive products as China does. These nations include Mexico, Pakistan, Brazil, and some countries of Africa. It is a general but sometimes neglected result in trade theory that the growth of a large nation will raise world GDP per capita, but can hurt the nations that are most similar to the growing nation.
Richer nations could be hurt eventually if China continues to move up the product ladder. It would then produce and export more knowledge-intensive products, partly made possible by China’s disrespect for property rights, intellectual property, and patent protection laws. But even so, I believe that rich nations will generally benefit from China’s progress since different richer nations generally specialize in different types and varieties of products and services. Moreover, as China gets richer, it will provide even larger markets for exports from other nations.
But to return to the main theme, as with Russia, Germany, and Japan, it is not inevitable that China will continue to grow rapidly enough to equal or surpass eventually the growing per capita incomes of the US and Western Europe. For like the other nations that looked unstoppable, China has serious problems, and other problems might surface as it becomes richer.
China has a disastrous capital market, with government banks that have been forced to make loans to inefficient public companies. The result has been hundreds of billions of dollars of debt that will never be repaid, and are now being auctioned off. Perhaps that debt overhang will be rapidly absorbed, but Japan suffered for more than decade with a huge supply of bad bank debt that they did not absorb efficiently; indeed, the government has continued to encourage the creation of more bad debt.
China still has many highly inefficient public enterprises that authorities are reluctant to close because they fear discontent from laid off workers. These enterprises can stay in business only because they receive uneconomic loans from other state enterprises; namely, the banks. China does not have a developed system of commercial laws, and shows little respect for intellectual property rights. This may well be a rational strategy for a developing nation that is mainly using knowledge originated elsewhere, but this strategy becomes a drawback as a country becomes richer, and must begin to participate itself in the production of new knowledge.
Authoritarian regimes can do well economically when they have good leaders, but they can produce disasters when these leaders have foolish economic ideas. China discovered this under Mao, with his incredible “great leap forward” that helped kill millions of rural Chinese. While the evidence indicates that authoritarian regimes do not grow slower on average than democratic governments, they do have more unstable growth rates than democracies. I believe China will become more democratic if it continues to grow rapidly, but economic progress could falter badly if they select poor leaders who have strange ideas about how economies should be organized.
China has had a much faster decline in birth rates to below-replacement levels than other developing nations, no doubt helped by its so-called one child policy. This has meant a prematurely aging population that creates a burden on its evolving social security and health systems as relatively few young persons one way or another have to “finance” the care of increasing numbers of elderly.
The rapid fertility decline also greatly slowed its population growth, which may have looked attractive in a poor Malthusian-style economy. But knowledge-based economies often thrive on larger populations because of what economists call increasing returns to scale in the production of new knowledge, and in the degree of specialization in different types of human capital. While exports to the world’s population provide some offsets to declines in a country’s population, domestic populations are much more important usually in determining the advantages of investments in knowledge and human capital.
A more intangible but important factor is that as countries get richer, they often introduce policies that retard further progress. This happened in Germany with legislation that made labor very costly, and ossified its labor and retirement markets. It happened in Japan that kept many regulatory restrictions on services, on foreign investments and immigration, and maintained a protected and inefficient banking system. It can surely happen also in China in ways that are difficult to forecast at this early stage of its development.
I am not saying that China will not become the leading economic nation, but rather that it is far too early to tell. The many failed predictions about Japan and other nations should make us modest about such long-term predictions. Perhaps India will become the leader-it has strengths (and weaknesses) that China lacks- or maybe Brazil if it can finally get its act together.
Or indeed, perhaps the US will continue to be the most dynamic economy. Many economists and others wrote off this economy during the 1970’s and some of the ‘80’s when productivity growth declined and the economy faltered. Since I do not believe countries necessarily age the way species do, the US can continue to do well- productivity started growing rapidly about 10 years ago- if it provides a good environment for new companies, flexible labor and product markets, sizeable investments in human capital and technology, and an open attitude to new ideas, immigrants, and different ways. Those of you alive in 20-30 years will be able to discover if my skepticism and analysis will be borne out by events.
Posted by becker at 9:46 PM | Comments (20) | TrackBack
Will China Overtake the U.S.? Posner Comment
I have no crystal ball, and cannot predict China’s economic performance. I doubt that anyone can; there are too many uncertain variables. Typical projections, for example in a recent National Intelligence Estimate issued by the National Intelligence Council, a prestigious group within the U.S. intelligence community, are of the “more of the same” character: China is growing rapidly and can be expected to continue doing so. About all that one can do responsibly is list some of the factors that favor and some that disfavor China’s future growth.
On the plus side, the Chinese population is highly energetic and intelligent, and of course vast; and there are still unexploited human resources, both in rural areas and in the workforces of the inefficient state-owned factories. If those factories are privatized (and probably therefore shut down), the workers will be freed to engage in more-productive economic activities. Although I agree with Becker that at some point China cannot continue progressing rapidly just by copying foreign technologies, already we see rapid growth of scientific research in China and a friendlier attitude on the part of the Chinese authorities toward intellectual property rights, which will facilitate the creation of new technologies.
But there are definite negatives in the picture. I am struck by the resemblance between China and Wilhelmine Germany (1871–1918)—two aggressively, at times hysterically, nationalistic countries, paranoid about encirclement by potential enemies (in China’s case, Russia to the North, India to the Southwest, Vietnam to the South, and South Korea, Taiwan, and above all the United States, to the East), and possessed of economic institutions more advanced than their political institutions. That is an explosive combination. It may lead China to invest very heavily in military power and even to become involved in wars that could bring disaster upon it.
The very pace of China’s economic modernization may be politically destabilizing. Fear of internal disorder, a fear rooted in bitter historical experience, is acute—how else to explain the government’s persecution of Falun Gong, an apolitical, quasi-religious Confucian sect devoted largely to physical exercise? Restive minorities include Tibetans and also a large number of Muslims in the western part of the country.
As nations become wealthier, pressure for greater personal liberty grows; and while as Becker notes dictatorship is not incompatible with rapid economic growth, it increases variance in that growth because dictatorship is (despite appearances) a fragile form of government. A dictatorship can collapse suddenly and usher in economic disaster, as happened to Iran when the Shah was deposed in 1979 and, to a lesser degree, when the Soviet communist dictatorship collapsed.
Apart from political instability, the continued rapid growth of the Chinese economy is threatened by infrastructure limitations, pollution, shortages and bottlenecks, a weak banking system, corruption—and the remarkable imbalance between male and female births. With 116 recorded male births for every 100 female births, and an excess of 70 million males over females in the population as a whole, Chinese men will soon find themselves competing for an inadequate supply of women. The result is likely to be a steep decline in the age of first marriage for women (as in polygamoous societies), which may in turn reduce female participation in the workforce and with it economic output.
But how all these factors will interact in the decades ahead simply cannot be predicted.
Posted by posner at 9:35 PM | Comments (16) | TrackBack
Response on Bankruptcy Reform_BECKER
Only a few comments, so I can respond briefly.
I do not see how equity loans can discourage entreprenuership or investments in human capital. Does allowing companies to issue equities discourage borrowing by companies? No, for instead it gives companies greater options, and so too would such human capital equity loans. Companies that do not want to share their profits can only take on debt; similarly, individuals that do not want to share their earnings can only take on fixed interest debt.
I find it strange that some of you are perfectly willing to have governments make special rules for their insured lending so that student loans are not dischargeable by bankruptcy. Yet you are nervous about allowing this privilege to private lenders making other human capital loans. The purpose of my suggestion about bankruptcy is to encourage greater amounts of human capital loans-at present there are practically no fully commercial human capital loans. This situation does not hurt rich persons much, but does badly limit the opportunities of young persons from poor families. They might gravitate to the equity side of my proposed human capital loans, but why is that bad if this gives them more opportunity for investments in themselves, and in other ways?
A good comment about selectivity among which persons take out equity loans and which take fixed interest loans that is highly relevant. Yale's system of equity human capital loans for their students of a couple of decades ago failed partly for this reason. But this is also a problem with equities for private companies, and that works reasonably well. To the extent that information about talents and occupations, etc is generally available, then the lending market on human capital loans should adjust its conditions to the abilities and occupations of indviduals.
Posted by becker at 5:36 PM | Comments (7) | TrackBack
The Bankruptcy Reform Act--Posner's Response to Comments
These were excellent comments as usual--many negative, but that's fine.
A few brief countercomments:
The main negative comment is that credit card companies have obscene profits and therefore are not being hurt by Chapter 7 bankruptcy which makes it easy to wipe out credit card debt. It is very difficult to determine whether an industry's profitability is in excess of competitive levels, which is why economists frequently fall back on market-structure indicators--all of which suggest that the credit card business is highly competitive and profits therefore probably normal. But we needn't rest on conjecture. The nice thing about a new law, from the analytical standpoint, is that it should enable persuasive hypothesis testing. Critics contend that the new law will not reduce interest rates; we shall see. (But it should be noted that, from an economic standpoint, if costs fall, a monopolistic industry, like a competitive one, will reduce price; the profit-maximizing price will be lower as a result of the reduction in costs.)
I certainly agree that if interest rates fall, it will not be out of generosity on the part of credit card companies. It will be the result of competitive pressures that compress price when costs fall.
Some commenters doubt that Chapter 7 bankruptcy harms credit card companies. But if it doesn't, the companies' support for the Bankruptcy Reform Act makes no sense. And think: if there were a law that every tenth restaurant customer can leave without paying, would the restaurant industry think the law harmless?
One comment suggests that the logic of my position is to restore debgtors' prisons! Actually, lenders would not favor such restoration, because it would make people afraid to borrow. It would be possible to abolish bankruptcy, and thus bankruptcy discharges, without restoring debtors' prisons. The effect of such abolition would be that debtors could be required to pay a modest fraction of their income--indefinitely, rather than just for five years, as under Chapter 13--to pay off the debt.
Much concern is expressed about the impact of the Act on the poor. But the poor will remain fully eligible for Chapter 7. Moreover, commenters who worry that the poor are inveigled into borrowing more than they can afford should favor the tightening up of bankruptcy, because it will deter borrowing by people who realize they're in danger of overborrowing and going broke. Liberals may think the poor too dumb to realize this, but I disagree. In this connection, while relating the new Act to a general ideology of encouraging financial self-reliance by people of modest means, I did not mean to suggest (as one commenter thought) that it is ideology that drove the reform. I assume politics drove it. And, by the way, I do not favor generous exemptions for home or other property of rich people who go broke. I would be happy to see them hung out to dry.
Some comments point out correctly that the option of bankruptcy, by reducing financial risk, combats risk aversion and encourages entrepreneurship. Fair enough; but individual as distinct from business bankruptcy is only tenuously related to this goal.
Posted by posner at 4:49 PM | Comments (11) | TrackBack
