How to Succeed in Love (and the Market)
On the occasion of Valentine’s Day, here is a bit of advice from Amir D. Aczel, author of Chance:
A mathematical theorem has been developed that gives us the best sampling and stopping rule for all these situations. It can be found and further explained in books on probability. But the strategy is as follows:
- You will maximize your probability of finding the best spouse if you date about thirty-seven percent of the available candidates in your life, and then choose to stay with the next candidate who is better than all previous ones....MORE
- I know Aczel isn't an economist, the second half of this post was prompted by a comment on a WSJ.com Environmental Capital post:
- A Dirty Word or a Dirty World?
Comment by - February 14, 2008 at 2:09 pm
- ...As with any economic studies, the devil is in the details, namely, the underlying assumptions. This authors of this study make a couple of massive assumptions that lead to some wonky results.
Uh huh.
From Wharton via Notre Dame:
TOP TEN ECONOMIST VALENTINES
8. WHAT DO YOU SAY WE RE-MEASURE OUR CROSS-ELASTICITY
5. FURTHER STIMULUS COULD RESULT IN UNCONTROLLED EXPANSION
4. TELL ME WHETHER MY EXPECTATIONS ARE RATIONAL
3. LET'S ASSUME A RITZY HOTEL ROOM AND A BOTTLE OF DOM
When Albert Einstein died, he met three New Zealanders in the queue outside the Pearly Gates. To pass the time, he asked what were their IQs. The first replied 190. "Wonderful," exclaimed Einstein. "We can discuss the contribution made by Ernest Rutherford to atomic physics and my theory of general relativity". The second answered 150. "Good," said Einstein. "I look forward to discussing the role of New Zealand's nuclear-free legislation in the quest for world peace". The third New Zealander mumbled 50. Einstein paused, and then asked, "So what is your forecast for the budget deficit next year?" (Adapted from Economist June 13th 1992, p. 71).
...Q: How many conservative economists does it take to change a light bulb?
A1: None. If the government would just leave it alone, it would screw itself in.
A2: None, because, look! It's getting brighter! It's definitely getting brighter!
A3: None, they're all waiting for the unseen hand of the market to correct the lighting disequilibrium.
(The above light bulb jokes were mostly stolen from an article in The Wharton Journal, Feb. 21, 1994, by Selena Maranjian, who undoubtedly pilfered the humor from someone else.)
Q. What's the difference between an economist and a befuddled old man with Alzheimer's?
A. The economist is the one with the calculator.
This tale is said to be told by John Kenneth Galbraith on himself. As a boy he lived on a farm in Canada. On the adjoining farm, lived a girl he was fond of. One day as they sat together on the top rail of the cattle pen they watched a bull servicing a cow. Galbraith turned to the girl, with what he hoped was a suggestive look, saying, "That looks like it would be fun." She replied, "Well.... She’s your cow."
An economist is someone who doesn't know what he's talking about - and make you feel it's your fault.And finally, the one I was looking for (economic assumptions) that triggered this whole post:
A physicist, a chemist and an economist are stranded on an island, with nothing to eat. A can of soup washes ashore. The physicist says, "Lets smash the can open with a rock." The chemist says, "Let’s build a fire and heat the can first." The economist says, "Lets assume that we have a can-opener..."
Trouble is, politicians and laymen will jump on this study as providing an objective, open-and-shut answer. It takes a trained economist to spot another economist’s iffy assumptions.