Category Archives: Moral Hazard

Play stupid games, win stupid prizes

From the Australian Financial Review, 29-30 July – ‘Slow Connections’: When Stephen Sims hears one of his clients is getting the National Broadband Network installed, he sends them a wireless router and a 4G dongle. “The NBN connections have been … Continue reading

Posted in Critical Thinking, Decision-making, Epistemic Rationality, Esau Problem, Instrumental Rationality, Moral Hazard, Principal-Agent Problems, Prize for Myopia, Sunk Cost Fallacy | Leave a comment

Verballing Paul Volcker

I was interested to learn of this publication, written by two of the lecturers under whom I studied at university (plus a third who is unknown to me). While occupying a place on the n-dimensional political spectrum which is the polar opposite … Continue reading

Posted in Moral Hazard, Motivated Reasoning, Principal-Agent Problems | 1 Comment

Cri de coeur

Inner Immigration (Résumé of a German woman) I am almost 50 years old, I have a University degree, and was – out of love for nature – always a trusted voter for the Green Party. I never felt much interest … Continue reading

Posted in Democracy and freedom of mind, Flotsam and Jetsam, Freedom of speech, Moral Hazard, Principal-Agent Problems, The Mind & Society | Leave a comment

Zbig Brzezinski Prize: oil exporters enter the competition

And so, only one day after the initiation of the competition, we have a collective entry into the competition for the Zbigniew Brzezinski Prize for Myopia: When the price of oil was above $100, many of the less developed oil exporting … Continue reading

Posted in Esau Problem, Moral Hazard, Prize for Myopia | Leave a comment

Public Choice Theory Vindicated! … umm, again

The Principle-Agent Problem strikes again. Who’da thunk it?? “Most of my colleagues are dishonest career politicians who revel in the power and special-interest money that’s lavished upon them.” “My main job is to keep my job, to get reelected. It … Continue reading

Posted in Asymmetric Information, Esau Problem, Moral Hazard, Principal-Agent Problems | Leave a comment

Kidding yourselves, and hoping to kid others too

This being the ‘silly season’ here in the Southern Hemisphere, the national broadcaster, with most of its talent taking long vacations, is filling the airwaves with replays of old shows. One of which, a documentary about how the universities’ need for … Continue reading

Posted in Asymmetric Information, Moral Hazard, Principal-Agent Problems | Leave a comment

The Horrendous NBN

Catching up on my reading, and on material which I have wanted to write a post about after seeing it, I finally found these couple of pieces, from the Fin Review of June 12 this year, regarding the National Broadband Network. First, … Continue reading

Posted in Decision-making, Esau Problem, Moral Hazard, Poor reasoning, Problems with perception intuition and judgement | 1 Comment

Goodhart’s Law in action: Henry, Rudd and the financial crisis

One of the valuable insights that I learned about in my training in economics is Goodhart’s Law. This law, named after its originator, the first-class English economist Charles Goodhart, can be stated, very simply, as: When a measure becomes a target, it ceases to … Continue reading

Posted in Flotsam and Jetsam, Good Thinking, Moral Hazard | Leave a comment

A follow up to the ‘Bob Woodward’ post – the nightmare of post-invasion Iraq

Three weeks ago I wrote about the disastrous decision-making in the Bush administration which led to the invasion of Iraq, the removal of its functioning government, and the failed occupation of the country. The subsequent decision to leave the country … Continue reading

Posted in Decision-making, Moral Hazard, Poor reasoning | Tagged , , | Leave a comment