Archive for 2007
Does Catholic Social Teaching Matter in the Classroom?
| Cliff Grammich |
Starting with Leo XIII’s encyclical Rerum Novarum and continuing notably in the writings of Pius XI and John Paul II (and, to be sure, others as well), the Catholic Church has fostered a tradition of social teaching for application to modern business organizations. During John Paul II’s pontificate, the Church also sought to strengthen the identity and clarify the mission of Catholic higher education.
So what impact does the Church’s social teaching have in the undergraduate business classrooms of Catholic institutions? Roland and Linda Kidwell suggest it is muted; indeed, they “conclude that if Catholic institutions wish to provide an ethics-based business education, familiarity with and use of [Catholic social teaching] appear to be unnecessary at AACSB-accredited schools.” (more…)
18 February 2007 at 10:11 pm Clifford Grammich Leave a comment
The Dark Side of Charisma
| Peter Klein |
Entrepreneurship has been described as charismatic leadership or charistmatic authority. But what exactly is charisma?
The WSJ’s Saturday edition reviews Philip Rieff’s posthumously published Charisma: The Gift of Grace, and How It Has Been Taken Away from Us. Rieff, the distinguished cultural sociologist who taught at Brandeis, Berkeley, Harvard, and Penn, began the book in the late 1960s but went on to other projects, completing it just before his death earlier this year. Reviewer Adam Wolfson describes the book as a jeremiad against popular culture, much like Allan Bloom’s Closing of the American Mind. (more…)
Three Great Austrian Economists in One Book!
| Nicolai Foss |
My co-blogger abundantly possesses that increasingly scarce resource: Modesty. So, I suppose it falls on my shoulders to announce to the blogosphere that the Mises Institute has just published a beautiful new edition of Carl Menger’s Principles of Economics with a foreword by Peter. (more…)
Nerd Alert, Part II
| Peter Klein |
Though we often tease our colleagues in the MathEcon tribe, we hope to make O&M a comfortable place for them. Henceforth, we proudly announce, for you math geeks out there, that our server now knows how to process 
While management working papers are almost always written in Word,
or the definition of Bayesian Nash equilibrium,
then O&M is the blog for you!
The Vertical Dis-Integration of Organized Crime
| Peter Klein |
It’s said to be happening in manufacturing, services, and even higher education; why not organized crime? The Financial Times reports that Japanese gangs are relying increasingly on part-time mobsters. According to Japanese police statistics part-timers now make up 51 percent of total gang membership, up from 33 percent in 1991.
One explanation: the Dilbert-style bureaucracy of the established gangs:
Part-time gang members may also be opting out of the hierarchical world that full-time membership entails. Onerous duties include making cash payments to the oyabun, a young hoodlum’s father-figure boss, and keeping long hours, for instance by preserving a henchman’s precious parking space.
Similarly, in regular business, many young Japanese prefer bouncing between part-time jobs to joining a rule-bound company. Like yakuza gangs, Japanese businesses tend to be hierarchical, with strict dress codes, mind-numbing duties and compulsory overtime.
Would these mob Bosses pass Bob Sutton’s test?
Responding to such pressures, the gangs have learned to outsource (presumably “non-core”) tasks to contract workers. Says one Japanese lawyer familiar with underworld issues: “These guys are the best entrepreneurs in the country, certainly the most responsive to change in business conditions.” (HT: PSD Blog)
Call for Papers: Law and Economic Development
| Peter Klein |
The Global Economic History Network is sponsoring a conference at Utrecht University, 21-23 September 2007, on “Law and Economic Development: a Historical Perspective. Abstracts are due 31 March 2007. From the call for papers:
This conference aims to bring a truly global and multi-disciplinaryperspective to the relationship between law and long-term economic growth. We focus on formal legal rules, procedures and institutions in the wide context of legal traditions and their relationship with contract enforcement and property rights. We aim to broaden the scope of our discussion with a global perspective that includes both Western and important non-Western legal traditions such as the Chinese, Islamic or Hindu that have been largely neglected in the”legal origin” debate.
The legal origin debate, if you’re not familiar with this literature, began with the influential paper by La Porta, Lopez-de-Silanes, Shleifer, and Vishny, “Law and Finance” (JPE, 1998). LLSV argued for a strong correlation between a nation’s financial-market development and the origin of its legal system. (English common-law countries fare the best, while countries with a legal system based on — you guessed it — French civil law are the worst.) This paper, and a series of follow-up studies by the same authors, established a new strand of literature on economic development using large, cross-country panel datasets containing various measures of legal, poltical, social, and cultural institutions.
Critics argue that financial-market development and overall economic performance are driven not by legal origin but by politics, culture, and geography, among other factors, and that LLSV oversimplify the causal relationships between institutions and growth. (The chapter by Thorsten Beck and Ross Levine in the Handbook of New Institutional Economics — which also contains a very nice chapter on the make-or-buy decision, by the way — provides a useful overview and critique of this literature.)
Taxi Drivers in Nam
| Nicolai Foss |
It is always lovely to witness our theories come alive. So, here is an illustration of the agency problem for the benefit of our non-American readers (the example will be lost on Americans for reasons that will become clear :-)). A favorite examplification of agency problems are taxis (not Hayekian ones — real ones), because of the complex ownership arrangements of these assets.
When I visited Vietnam in January with my family, the way we got around in the cities was mainly using the private and extremely inexpensive taxis (there is virtually no public transportation in this supposedly commie country). Most other transport options (certainly bikes, “cyclos”, motorbikes, even walking) increase the death risk rather dramatically in the horrendous Vietnamese traffic. (more…)
Life Among the Econ
| Peter Klein |
A colleague and I were just discussing Axel Leijonhufvud’s delightful ethnographic satire, “Life Among the Econ” (Western Economic Journal 11, no. 3, September 1973: 327-37). (Can’t find it on JSTOR; here is a scanned PDF version with a few minor errors.) Though slightly dated, Leijonhufvud’s essay remains a treasure trove of wit and wisdom on economics and economists. Here are a few passages dealing with issues recently debated at O&M: (more…)
An Un-Valentine’s Market
| Cliff Grammich |
Earlier today I followed up an earlier post of Peter’s on the business of weddings. It appears that’s not the only business that might boom around Valentine’s Day — my friend Liz Birge reports the divorce (legal) services market does as well . . .
The Weatherhead School’s Tumor
| Peter Klein |
Case Western Reserve University’s Peter B. Lewis Building, the Frank Gehry-designed home of the Weatherhead School of Management, recently made critic James Howard Kunstler’s Eyesore of the Month list. “If your dog had a tumor like this,” writes Kunstler, “the vets would just shake their heads and put him to sleep.” (HT: Max Goss)
New Entrepreneurship Society and Journal
| Peter Klein |
Here is the webpage for the Southern Entrepreneurship Journal, to be published by the newly formed Southern Academy of Entrepreneurship. From the mission statement:
Our dream is to offer an eclectic, cross-disciplinary entrepreneurship research experience. We do not care what your field may be. Our only concerns are (a) do you have something interesting to say about the theory or practice of entrepreneurship, and (b) do you have any evidence that supports you? We also want to be open minded about evidence. The Journal will be open to a range of evidence, including case studies, qualitative research broadly defined, as well as statistical analyses.
Thanks to Ed Lopez for the pointer.
Nerd Alert!
| Nicolai Foss |
What can possibly be more relevant for an econ-oriented blog than to wax lyrical about calculators? Do you remember Hewlett-Packard’s ill-fated experiments with Reverse Polish Notation? Or their excellent HP 41 model? (We will forget about their wristwatch-calculator.) Did you own a TI-57 and its excellent successors TI-58 and 59? Or, did you have to manage with a crappy TI-30? And what about the super-innovative Casios? Chances are that if you are old enough and are reading this blog, you were part of the great calculator craze of the 1970s and 1980s.
Receiving my first electronic calculator from my grandparents on my 9th birthday in 1973, I acquired a taste for these great gadgets and probably owned around 50 of them from 1973 to 1983 at which point of time I completely lost interest (unlike this über-nerd — who is even German). Those of you who harbor nostalgic memories, check out The Old Calculators Web Museum or the Pocket Calculator Show.
More on the Business of Weddings
| Cliff Grammich |
In an earlier discussion of the business of weddings, Peter, responding to one commenter, expressed hope that by the time his “daughter is of marryin’ age, some kind of ‘peasant weddings’ will be in style.” I might even encourage elopement, although it’s fascinating how this assumedly cheap option has apparently evolved into the less cheap “destination wedding.” (more…)
15 February 2007 at 10:21 am Clifford Grammich Leave a comment
Intellectual Property: Who Needs It?
| Peter Klein |
Michele Boldrin and David K. Levine provide a succinct overview of the economic argument against strong IP in the January 2007 issue of the Freeman. In “Open-Source Software: Who Needs Intellectual Property?” Boldrin and Levine argue that open-source developers benefit primarily not from writing code, but from selling complementary services such as support, and that these incentives, not altruism, are responsible for the substantial innovations coming out of the open-source community. They conclude:
[T]he market for software is not unique. Innovation and competition unprotected by patent and copyright have gone hand in hand in other industries, from financial securities to fashion. The message of open-source software is a message for all industries: IP not needed for innovation here.
Agreeing With Omar
| Nicolai Foss |
Geoff Hodgson is in many ways an extremely interesting scholar. His work is penetrating, he is extremely widely read, his critique of mainstream economics is often well taken, and he is a lucid writer. However, he (like all of us) entertains at least one heavy idiosyncracy, namely a chronic penchant for picking on the notion of methodological individualism. Some of us think methodological individualism is almost trivially true, but Hodgson certainly wouldn’t agree. Many of his writings contain attacks on MI. A recent issue of Organization Studies contains a major diatribe against MI penned by Hodgson. (more…)
Breaking Up (Used to Be) Hard to Do
| Peter Klein |
“Breaking up is hard to do,” sang 1970s crooner Neil Sedaka. But he didn’t have a mobile phone. According to a Virgin Mobile USA survey (reported in today’s WSJ), one in ten 18-to-34 year olds has dumped a romantic partner via text message. “Yes, the lack of face-to-face contact can avoid prickly encounters and get the deed done without bloodshed,” writes the Journal reporter. “But as we contemplate Valentine’s Day 2007, it also is an indication that interpersonal relationships today are often less personal and more cowardly than they used to be.”
Fodder for the Bowling Alone crowd. And helps put Radio Shack’s decision last year to fire 400 employees via email in context.
Religion and the Market
| Cliff Grammich |
The Intercollegiate Studies Institute has announced its 2006 Templeton Enterprise Award winners. The awards are “presented annually to scholars under forty who have produced the very best books and articles in the field of humane economics and culture over the past two years.” Many of the honored works, e.g., Thomas Woods’ The Church and the Market, provide an interesting reconciliation of (Catholic) Church teaching with free market economics, drawing inferences one won’t typically see in staff work of the bishops’ conferences.
Geography Is Destiny
| Peter Klein |
When it comes to innovation, that is, writes Greg Zachary in Sunday’s New York Times. “[T]he inescapable lesson of the iPod, Google, eBay, Netflix and Silicon Valley in general is that where you live often trumps who you are.” Increasing returns and first-mover advantages — “debated in head-scratching terms by professional economists” — explain the geographic concentration of technology firms. (HT: Richard Florida)
No time for head scratching today, but I’ll throw this out for your consideration: I think the literature tends to overemphasize localization economies as a source of increasing returns, downplaying the gains from urbanization stressed by Jane Jacobs. Could this be because economists generally underappreciate the importance of uncertainty, experimentation, and serendipitous discovery, preferring to stick with equilibrium models of endogenous growth?
Here’s more on Jacobs from Richard Florida and from Lynne Kiesling.
Update: The Rockefeller Foundation has created a Jane Jacobs Medal.
Which Economies do Economists Study?
| Peter Klein |
Michael Robinson, James Hartley, and Patricia Higino Schneider have an interesting paper, “Which Countries Are Studied Most By Economists? An Examination of the Regional Distribution of Economic Research,” in the February 2007 issue of Kyklos (volume 5, number 1). Not surprisingly, bigger and wealthier countries, countries that are more open to outsiders, and countries that make economic data available get the most attention. Other significant predictors of the amount of economic research on a country are tourism receipts, whether English is an official language, and the number of domestic economic research institutions. Parts of Africa get less attention even controlling for these observables.
The University of Phoenix and the Economic Organization of Higher Education
| Peter Klein |
The Sunday New York Times features a lengthy, and mostly unflattering, look at the University of Phoenix, the world’s largest for-profit university. The tenor of the Times piece is set by the headline, “Troubles Grow for a University Built on Profits” — the p-word clearly chosen to shock the Times’s modal reader. (Where were the stories on the Times’s Judith Miller scandal titled “Troubles Grow for a Newspaper Built on Profits”?)
What’s remarkable about the article is not the conclusion, which is largely predictable, but the form of the argument. There is no attempt to evaluate the University of Phoenix’s efficiency or profitability, the quality of its product, or the value added of its degree. (Just a few quotes from disgruntled students, taken at face value; obviously no one at the Times reads RateMyProfessors.com.) Rather, the focus is on the production function. Because Phoenix uses an unusual production technology, the Times implies, its product is suspect. (more…)
Organizations and Markets 
Recent Comments