Author Archives: blueocean

Towards a better review system

The five-star review system you find on most websites today is inherently flawed if you want information about how good something actually is. Famously, on websites like Amazon, there is a ‘J-shaped’ distribution of review scores. That is, there is a small mass of 1-star reviews; relatively few 2-star, 3-star, and 4-star reviews; and a huge mass of 5-star reviews. This, on it’s own, means that most reviews are somewhat useless. But, when you remember that some of these reviews […]

The battle for the PC gamer

It’s as if someone has flicked the switch this year in the minds of Microsoft and Sony. It used to be that console manufacturers would focus on getting as many people on their own platform as possible. This meant drawing in people from every other market to theirs. This is fine in principle. The problem is that in practice, consumers are not homogeneous in this way. There are plenty of people for whom a certain product line will not work, […]

Useful LaTeX packages for writing papers

LaTeX is amazing for producing beautifully typeset documents. However, it can also be a bit of a clunky pain in the backside. Granted, much of that pain comes from tables, but there are other niggles here and there that can make your life a bit miserable. Hopefully, a CSS + HTML based solution may take over as a more modern and efficient markup language for typesetting in future. For now though, here are a few LaTeX packages I use frequently. […]

DLC meets behavioural economics

A little while back, I wrote about some of the theory behind present biased behaviour. People who are present biased (i.e. place a disproportionately high value to things that happen right now, relative to things that happen in the future) can be aware of the fact that they are (‘sophisticated’), or not (‘naive’). One interesting and important implication of the theory is that sophisticated people will respond to commitment devices that are costly. For example, Gine and others published a […]

“Learn to read the Bible effectively”

This leaflet came through my letterbox last week. “An exciting 6 week seminar”, free of charge, to learn how to read the Bible effectively. Apparently. It is being run by the ‘West Christadelphians’ – something I can only assume is an organisation set up by fans of the Fresh Prince of Bel Air. At first I was going to give them a little credit, since running a 6 week long seminar is quite ambitious and impressive by anyone’s standards. However, […]

Photo by Sander van der Wel

The separation of individual from cause

“Thank you for answering my questions. Do you have anything you would like to ask me?” “How often do you get to see the impact you have made with the work you do? I like to do something where I can solve a problem and see the fruits of my labour, so to speak.” “In the past, to be honest, we really didn’t see what happened that much. But it is more and more the case that we get to […]

The Perils of Present Bias

In 1999, Ted O’Donoghue and Matthew Rabin published a paper in the American Economic Review that, 8 years later, would serve as the catalyst for my interest in Behavioural Economics. For the longest time, economists had recognised that people place a lower weight on things that happen later in the future than things that happen sooner. The problem was that the way in which this was represented mathematically, although simple and convenient, suggested that people would behave consistently about the […]

Price Discrimination on Steam

Price Discrimination is a well-known concept in microeconomics. The basic idea is quite simple. In a competitive market, firms have to accept an equilibrium price. This is because competition, in theory, should drive prices down to somewhere close to marginal cost (the cost of producing one extra good). However, quite often in real life, a firm has some market power that enables them to set prices independently of other firms. This is possible for a number of reasons e.g. monopoly/oligopoly, […]

Why do niche bands become more mainstream?

Bands like Genesis, Muse, Metallica, and Dave Matthews Band have something important in common. They started out with music that was somewhat ‘against the grain’, attracting a specialist audience of listeners. Once they became more established, however, their music shifted towards more mass-market appeal, attracting the wider majority. I’m sure you can think of examples of bands which you liked, but felt subsequently ‘sold out’ in their later years. Conversely, you may also be able to think of bands that […]

Societal Sanity – a short story

“Welcome to the testing simulation! I’m very excited to try this out for the first time with the inclusion of a real human!” boomed a voice from loudspeakers somewhere in the distant darkness of this dimly lit, large room. The room contained multiple tables. Each one had 10 seating places, 5 facing another 5. It was somewhat classy — cabaret-like. At each chair sat a person, or what seemed like one. It was almost like those family gatherings the subject […]

Economic Intuition: Wotisit?

I recall teachers using the phrase ‘economic intuition’ a lot around my early exposure to the subject. The more I thought about it over the years, the more I wondered what this mystical superpower was. Economic intuition. What the hell is it, exactly? By definition, intuition is the ability to understand or make sense of something without conscious reasoning. An instinctive ability, if you will. This is rather amusing, because a large proportion of economics is about as unintuitive as […]

A theory about theory

As you may have heard, the legendary blues guitarist BB King died recently. Following this though, there were some comments on the internet that got me thinking. Intermingled with the usual condolences and such, a few commenters were critical towards him because of the fact that he did not have a strong understanding of music theory. Their argument seemed to be that his lack of theoretical knowledge about what he was playing somehow diminished his achievements. He is not the […]