Brangelina of the A.F.F. Set!

This is just too flattering to resist sharing. R.J. Lehmann, listing “the top five new persons, places or things I was introduced to in the last 12 months that combined to make 2005, all in all, a very good year,” puts Joanna & I, as a unit, at #2.

2. Willana — Or, if you prefer, Robkinson. Individually, they're Wilko and J-Ro. Together, they're the ultimate D.C. libertarian power couple, the Brangelina of the A.F.F. set. But as if being Triple-Bs (that's “brilliant beautiful bloggers”) weren't enough, prophecy foretells they shall one day conceive the annointed one, and unto him shall the gathering of radical individualists be. And he shalt smite the state, and there shall come water out of it, that the people may drink. And he shall be really, really ridiculously good-looking. And men shall call him…the Anti-Marx!

Of course, “the Brangelina of the AFF set” is sort of like “the Stephen Hawking of the Appalachians,” but we really like the idea anyway. Also, this reminds me that I've been meaning to write about the demographic strategy for libertarians. And Ray I think just won himself a dinner invitation to casa Willana.

Poverty in America and Happiness Talking Points

This article from the Christian Science Monitor explores new census data that shows that the poor in America own computers, dishwashers, and other appliances of convenience and amusement at historic rates. Naturally, the happiness question arises, and shows how journalists have been effectively propagandized into repeating a misleading, ideological happpiness talking point whenever good economic news arrives…

. . . by almost all measures, the data show rising well-being for all of society. And while the wealth gap may not be narrowing, the rich-poor gap in lifestyles has narrowed substantially since 1992 when measured in many of these tangible items.

“In terms of the items people have … it amazes me the number of people who are at or near the poverty line that have color TVs, cable, washer, dryer, microwave,” says Michael Cosgrove, an economist at the University of Dallas in Irving, Texas. That's not to ignore the hardships of poverty, he adds, “but the conveniences they have are in fact pretty good.”

Poor, but more comfortable
The study doesn't explore the happiness factor — whether the growing material prosperity is actually making people feel more satisfied with their lives. While economists tend to focus on things that can be measured in dollars and cents, the spiritual side of the economy has begun to garner more attention. That's partly because some research has found that once people gain a modest sufficiency in goods, further increases in income don't result in rising happiness.

This happiness talking point is extremely misleading. First, “don't result in rising happiness” obscures the fact that a large majority of poor Americans already report themselves as being pretty or very happy. I think many readers would interpet this as “doesn't do anything to pull people up from misery or unhappiness.” It would be less misleading to say “further increases in income don't result in happy people becoming even happier.”

Second, the talking point makes it sound as if there is some general finding that implies that a doubling of my salary would have no effect on my happiness. Which, of course, is total rubbish. We're talking about wealth within the United States, here. So, while the correlation between average income and average happiness is weak (though positive) over time or between countries–meaning that the average happiness at any given point in the distribution over the critical absolute threshold is likely to hold pretty steady over generations or between societies–the correlation within a given country at a given time is strong, and that's the relevant measure. Since everyone lives in a particular country at a particular time, what the research has found is that if your income increases, you are likely to get an increase in self-reported happiness. At any time and place, wealthier individuals will tend to be happier than less wealthy individuals.

Now, a rise in income sufficient only to maintain your position in the distribution will be unlikely make you much happier than you already are (unless your aspirations were low). However, through their prime working years, individual's incomes generally rise much faster than the economy grows (my income, to take a very typical example, has increased well more than 200% since I first entered the labor market). And so you can expect your rising income to have a very positive effect on your happiness through your working years, and throughout your life, if you have invested well. And this is just what the life-cycle happiness breakdown shows. It's our growing wealth that keeps our total satisfaction with life more or less steady as our satisfaction with health and family starts to declines in our our middle age.

Journalists need to understand that the “more money won't make you happier” talking point is, in fact, a piece of propaganda designed to weaken public support for wealth-enhancing policies. Once the data is framed correctly, there is really no reason to use the talking points. It does nothing to “balance” the story. Even if it is true that the microwaves and dishwashers of those beneath the poverty line aren't making them happier than they already were, they are freeing up time that would otherwise be spent on cooking and doing dishes. And that's just good.

[Cross-posted from Happiness and Public Policy. Please leave your comments there.]

The Strange Myth of Finite Status

I've always been a bit baffled by the common assumption in economic and social theory that the quantity of social status is fixed, such that games over the distribution of status are always zero-sum. The title of Frank's Choosing the Right Pond seems to assume that it isn't. Middling status in one pond can be high status in another. And how many ponds are there? But he almost always writes as if status is fixed. Becker and Murphy, in an exemplary discussion of status and inequality in Social Economics also assume a fixed amount of status. It's obviously useful to model it this way for certain purposes. But I also think it fundamentally distorts the phenomenon of status and status seeking.

We all know what status is, but, then again, we don't, really. Who has higher status: The Mayor of Des Moines or the quarterback for Notre Dame? The question has the sour flavor of a category mistake. As Frank's title suggests, status can be pond-relative. But, at the same time, it can seem like we know that the Chief Justice of the Supreme Court has higher status than the quarterback for the Fightin' Irish, although the incommensurability of domains creates some static in the judgment. It just might be that the CJ is higher status in his domain than # 12, Biff O'Malley is in his. So when we set the rankings by domain side by side, the right answer seems pretty obvious. One guy is at the top of his list, the other guy in the middle of his. So, easy!

But how about Peyton Manning vs. John Roberts. Here I don't think we can say. We'd need to know which status domain has higher status. And that sort of sounds like a category mistake, too. Anyway, is it a bigger deal to be one of the world's most gifted and celebrated athletes, idolized by children around the globe, watched by millions of fans each weak . . . or the head judge on the world's most powerful and exclusive legal body? In any case, it seems pretty clear that if Peyton Manning and John Roberts are both somehow competing for status, they're not competing with each other. When John Roberts was elevated, it might have stuck in the craw of some of his law school friends, or appeals court colleagues. But I don't imagine Mr. Manning took much notice, or felt himself diminished in any way.

The obvious point to make about status, then, is that it is domain relative, and that the number of domains does not seem to be fixed. (My example may tempt you you to confuse status for fame. Don't.) One of my favorite documentaries, Word Wars, goes inside the fascinating world of competitive Scrabble players. Naturally, this being a human endeavor, there is a ladder of status among Scrabble players, and for the people who devote their live and energy to the game, this is the kind of status that matters. Now, it may seem to you that Peyton Manning is a bigger deal than Joe Edley, but it doesn't seem that way to Joe Edley.

Think about the fragmentation of music genres, and how each genre has its own scene. Before there was ska, say, there was no ska scene. But now, a position of status in the ska scene is a cherished part of someones life. But scenes break down by geography, too. Take the DC punk scene. Whatever he might say to the contrary, Ian McKaye takes his exalted status to heart. Now, suppose a new speed metal scene blossoms in Milwaukee. The advent of the scene implies the opening of some positions of status. Chances are that the don of the Milwaukee speed metal scene will find his status gratifying. But this is status created, not taken. Tony Hawk's giant status in the relatively newly evolved skateboarding scene did not come out of Michael Jordan's hide.

It is not even clear to me that status within a domain, scene, or group is fixed. Take a group of three friends, Cindy, Marcy, and Julie. Cindy is clearly the leader, and so has status. But Marcy is the brains of the operation, for which she is also accorded a certain status. Julie is seen as a dutiful follower, worth having along because she is pretty and laughs at everyone's jokes. However, one day, Julie performs an act of amazing courage and fidelity, saving both Cindy and Marcy from grave danger. Julie gains new status for her mettle and faithfulness. But this is not status redistributed from Cindy and Marcy's accounts, but is rather newly created out of Cindy and Marcy's new and unanimous admiration.

People in a group of friends may compete for status as the funniest one, or the smartest one. But even then, status can get distributed pretty subtly, and what may seem like a single dimension of status may end up finely divided, one person generally admired for his mordant, cutting wit, another for her hilarious jocularity. Status-seeking, even at the micro-level, is not really zero-sum war of all against all. In my opinion, a really healthy group of friends is one which the dimensions of status are so many that everybody is high status on some dimension or other, and the calculation of absolute or total status across all the relevant dimensions is more or less impossible.

That said, other things equal, I think people prefer to have status in a broader or more general domain. And I think this is where things gets complicated, and where status and fame, which are quite different, are complexly intertwined. Generally, you get high status in some domain of wide interest. This brings you to the attention of the media, and therefore the public. If everyone is suitably impressed or interested, you capture a portion of the public's attention, and become famous (at least somewhat). You then gain additional status simply in virtue of your fame. You become known for being known. (Kato Kaelin has a kind of status, just because lots of people know who he is, and not because he's worth a damn in any noticaeble way.) But the amount of fame is limited by the amount of attention within a society. (Here's where I find myself wishing I'd read Tyler's book on the economics of fame.) And so fame-dependent status is also limited by attention. Therefore, those whose status is heavily fame-dependent will be jealous of attention. Glenn Reynolds does not directly compete for status with Tom Brokaw. However, he does compete for attention. If more people get their news from blogs, and less from Brokaw, then Brokaw gets less attention, and takes a sort of hit in fame, and therefore status.

Because status is not fixed, and new status domains or niches can be opened, there is a possibility for status entrepreneurs who seek to discover, expand, and occupy new status niches. Visionary artists, who become deeply involved with creating something totally new, might be good examples. Sometimes, when you insist on doing something no one understands, others will interpret it as a willful resistance to playing the status game. But perhaps a better interpretation is that it is an entrepreneurial gamble on opening a new status niche. If audio/olfactory immersive ambient concept assemblage really catches on, then the first-mover has a big advantage. When the Museum of Soulwarping Newness buys your great work, “The Elusive Fatuity of Near-Death in C Major, with Notes of Jasmine and Pork Rinds,” for seven figures, and you start getting invited to fancy parties, you'll be, for a time, a status monopolist in your domain, and forever a pioneer.

Naturally, people who already occupy positions of wide status and semi-fame will attempt to denigrate the importance of new status domains in order to prevent a defection of attention. Indeed, the classic move is to try to characterize new domains of status as ipso facto low status. When some American Croesus slaps down 15 billion and opens Eisenhower University and buys up all the world's greatest scholars, Harvard grads the world over will promptly thrust their noses skyward in disdain for all those brilliant kids at the tacky new school who are getting the best education money can buy under the guidance of professors the Ivy League used to have. But it won't work.

So what to we do about the fact that people are status-seeking? What we do is encourage a decentralized entrepreneurial culture where status domains without number may bloom. Where the president of the Tuscon YMCA, the world's Scrabble champion, Tony Hawk, the best fusion jazz guitarist in Miami, and the first and only audio/olfactory immersive ambient concept assemeblagist can sleep sweet dreams, secure in their well-deserved status.