The Number Field

Economics is the study of the allocation of scarce resources. Ever since Freakonomics , it's become popular to apply it to non-monetary aspects of life. I first heard about Spousonomics when Jenny recommended that I listen to the Thanksgiving episode of Marketplace Money . The problem with books like this one is that the treatment of the problems they address is necessarily shallow--they generally cover only topics that might be found in an entry-level college course. Furthermore, economics is just one small discipline in the universe of academic study, and certainly not the only one that can be applied to real life problems, which are so much more complicated than any formal (or semi-formal) study can completely explain. It's the difference between a map and real terrain--economics gives us one map, but maybe it's a road map when a topographic map would be more appropriate, and in both cases it would be foolish to mistake looking at the map for exploring the land in person.

For instance, the authors of Spousonomics suggest that the principle of competitive advantage be applied to household chores--if spouse A is better at washing dishes and spouse B is better at something else--then assuming that the time commitment is similar, A should always was the dishes and B should always do the other thing. But this exposes one of the major flaws of economics ¹ , because it encourages trading of long term systemic benefits, like flexibility, for short term quantifiable gains, like reduced time for chore completion. Returning to the example, the downside is that when I don't wash the dishes enough, my dish washing skills atrophy to the extent that when I do need to wash the dishes, as I inevitably will, I do a much worse job than I would have if I had at least helped out once in a while. It's possible that the total loss may outweigh the incremental gains realized by focusing on competitive advantge. There are almost certainly more advantages to domestic cross-training than those described in simple analysis, such as potential skill transfer between disciplines, but those may be unknown unknowns and I think I've made my point.

A story gives us another conundrum that economics can't solve. Roman takes naps in a swing, but at night he sleeps in his car seat--that is, when he does sleep. This is not an option that will continue to work forever, as he continues to grow. He eventually will sleep in a crib-like area; we would prefer that he learn to sleep in the pack-n-play that we have set up for him. Jenny mercifully decided that last week was a good time to begin the transition, because I would be away three nights in a row. Things didn't go well. It was like my dad's old joke: "I slept like a baby last night; every twenty minutes I woke up crying." I'm afraid that I didn't help much when I returned home--the first night, I stayed up for the first shift and tried to comfort him, but Jenny naturally wakes up when Roman cries, so it didn't help her sleep much, especially since I'm not as good as she is at comforting him ² . When faced with a similar but apparently less intense situation, one of the spousonomocists wrote about stated versus revealed preferences , but didn't even try to solve the core issue of lack of sleep, which is the truly scarce resource in this situation.

As a mathematician, I always try to state a problem abstractly ³ . I am drawn to a half-remembered musing on philosophy by Douglas Hofstadter, arguably one of the great thinkers of our time. He wrote columns for Scientific American that were eventually collected into a book which I read as a teenager. In many of the articles he posed thought questions and invited responses from readers. Here's one of them: suppose you are in a decision-making position for a whole culture or society ⁴ . Your wisest and most trusted advisors come to you one day with an important decision. If you choose the first course of action, the entire world will be better off for more than a hundred years--GDP will be greater, lifespans will increase, happiness surveys will be off the charts--but at the end of that time (long after almost everyone currently alive is dead), an inevitable catastrophe will ensue, setting the entire society back more than 500 years. If you choose the second course of action, none of that happens: none of the boost, but also no catastrophe. What do you choose? At this time scale and magnitude of consequences, traditional economics is worthless ⁵ . I don't think that Hofstadter ever came down definitively on one side or the other, I but remember a follow-up column that explored both sides further.

With Roman, that situation is reversed and the time frame is shortened. To what extent are we willing to go through pain now in order to get to the long term steady state solution? Although it may appear that the situation is not comparable in scope to the previous example, I argue that when dealing with needs at the base of Maslow's pyramid (in this case, sleep), even short period of deprivation can lead to drastic effects. I don't know of any ten year olds that still sleep in car seats, but we run the risk that every day of delay makes it harder for him to make the change. While I sit here philosophizing, Jenny soldiers on, sacrificing her sleep and health.

This is the unacknowledged heart of the news stories that pop up every few months about whether parents are less happy than non-parents. It's a good question to ponder instead of counting sheep as I try to calm myself down on a sleepless night, but it's impossible to actually give an answer . There are buildings full of very smart people that can't even accurately forecast next year's tax revenues, much less long-term economic trends. Surveys of parents and non-parents may purport to have statistical significance, but they have no more actual significance than reductivist economics arguments about real life. It's like calculating the length of a coastline from a map's depiction ⁶ --you can try to do it, but it's subject to an uncertainty principle as real as Heisenberg's, rendering results meaningless regardless of their claimed significance.

1 This is presumably the kind of thinking that leads to the banana monoculture and banking crises.

² Another instance of competitive advantage gone awry.

³ I also attempt to reduce problems to those that have been solved, or at least stated, previously.

⁴ Let's pretend for now that this is an episode of Star Trek , where leadership structure is always simple and well-defined, and often immutable.

⁵ Regardless of your position on climate change, this is the fundamental disconnect between the two warring camps. Hofstadter was writing in the early 1980s, so he was probably motivated by the specter of the atom, both split and fused.

⁶ Hint: it's fractal .