Comments on: Amateur Hour with John Quiggin and Dan Hunter http://clubtroppo.com.au/2008/05/18/amateur-hour-with-john-quiggin-and-dan-hunter/ Mon, 01 Dec 2008 21:36:35 +0000 http://wordpress.org/?v=2.6.5 By: Patrick http://clubtroppo.com.au/2008/05/18/amateur-hour-with-john-quiggin-and-dan-hunter/#comment-273357 Patrick Mon, 19 May 2008 22:32:14 +0000 http://clubtroppo.com.au/?p=5352#comment-273357 <blockquote>The same opportunities for arbitrage don’t arise in other contexts, </blockquote> What, so love is a market now? Because this comment applies absolutely to love: <blockquote>I’m just saying that if you go into markets with a willingness to enter transactions that make you worse off (for reasons of altruism, friendliness, desire for display, failure to calculate correctly or whatever) that willingness creates an opportunity for other market participants and they will take advantage of it to the maximum possible extent.</blockquote>

The same opportunities for arbitrage don’t arise in other contexts,

What, so love is a market now? Because this comment applies absolutely to love:

I’m just saying that if you go into markets with a willingness to enter transactions that make you worse off (for reasons of altruism, friendliness, desire for display, failure to calculate correctly or whatever) that willingness creates an opportunity for other market participants and they will take advantage of it to the maximum possible extent.

]]> By: John Quiggin http://clubtroppo.com.au/2008/05/18/amateur-hour-with-john-quiggin-and-dan-hunter/#comment-273340 John Quiggin Mon, 19 May 2008 20:37:20 +0000 http://clubtroppo.com.au/?p=5352#comment-273340 On the first point, if you want to be absolutely correct, say "never give <strong>strictly</strong> more than you get." On the second, of course I'm not denying the existence of gains from trade or (therefore) the benefits of markets. I'm just saying that if you go into markets with a willingness to enter transactions that make you worse off (for reasons of altruism, friendliness, desire for display, failure to calculate correctly or whatever) that willingness creates an opportunity for other market participants and they will take advantage of it to the maximum possible extent. Hence, you will end up *a lot* worse off. The same opportunities for arbitrage don't arise in other contexts, so giving more than you get is not such a problem. Hence, people learn to behave differently in market contexts. On the first point, if you want to be absolutely correct, say “never give strictly more than you get.”

On the second, of course I’m not denying the existence of gains from trade or (therefore) the benefits of markets. I’m just saying that if you go into markets with a willingness to enter transactions that make you worse off (for reasons of altruism, friendliness, desire for display, failure to calculate correctly or whatever) that willingness creates an opportunity for other market participants and they will take advantage of it to the maximum possible extent. Hence, you will end up *a lot* worse off. The same opportunities for arbitrage don’t arise in other contexts, so giving more than you get is not such a problem. Hence, people learn to behave differently in market contexts.

]]> By: Nicholas Gruen http://clubtroppo.com.au/2008/05/18/amateur-hour-with-john-quiggin-and-dan-hunter/#comment-273255 Nicholas Gruen Mon, 19 May 2008 13:26:38 +0000 http://clubtroppo.com.au/?p=5352#comment-273255 John, I don't follow. What's wrong with one trader benefiting and the other not being worse off? And any way, all you have to show to vitiate your claim about markets is that that one got more than the other but they both benefited. But perhaps I am missing something . . . John, I don’t follow. What’s wrong with one trader benefiting and the other not being worse off? And any way, all you have to show to vitiate your claim about markets is that that one got more than the other but they both benefited.

But perhaps I am missing something . . .

]]> By: John Quiggin http://clubtroppo.com.au/2008/05/18/amateur-hour-with-john-quiggin-and-dan-hunter/#comment-273248 John Quiggin Mon, 19 May 2008 12:33:12 +0000 http://clubtroppo.com.au/?p=5352#comment-273248 A nice review, though I didn't think we overemphasised love - we tried to discuss a wide range of motivations, pointing out that all of them were rendered problematic by monetary incentives. As for “in market contexts, the first rule is never to give more than you get” the definition of a Pareto improving trade is one where both parties get more (in their own valuation) than they give, so I don't see that there is a contradiction. You're not the only one to object to this, though, so I'll give it some more thought/ A nice review, though I didn’t think we overemphasised love - we tried to discuss a wide range of motivations, pointing out that all of them were rendered problematic by monetary incentives.

As for “in market contexts, the first rule is never to give more than you get” the definition of a Pareto improving trade is one where both parties get more (in their own valuation) than they give, so I don’t see that there is a contradiction. You’re not the only one to object to this, though, so I’ll give it some more thought/

]]> By: James A http://clubtroppo.com.au/2008/05/18/amateur-hour-with-john-quiggin-and-dan-hunter/#comment-272907 James A Sun, 18 May 2008 13:51:15 +0000 http://clubtroppo.com.au/?p=5352#comment-272907 <a href="http://demos.co.uk/publications/proameconomy" rel="nofollow">The Pro-Am Revolution</a> covers much the same ground. It's been a while since I read it, but IIRC they used the term "pro-am" as some of the amateurs put in serious amounts of effort, sometimes more than the professionals they supplant. The Pro-Am Revolution covers much the same ground. It’s been a while since I read it, but IIRC they used the term “pro-am” as some of the amateurs put in serious amounts of effort, sometimes more than the professionals they supplant.

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