Marginal Revolution

Hanson on Bounties

Robin beats me to a story on bounties in the Washington Post.  I couldn't have said it better so here is his full post.

A Post article today, Bounties a Bust in Hunt for Al-Qaeda:

Jaber Elbaneh is one of the world's most-wanted terrorism suspects. In 2003, the U.S. government indicted him, posted a $5 million reward for his capture and distributed posters bearing photos of him around the globe.  None of it worked. Elbaneh remains at large, as wanted as ever. ...

Since 1984, the program has handed out $77 million to more than 50 tipsters, according to the State Department.  ... In 2004, Rep. Mark Steven Kirk (R-Ill.) visited Pakistan to assess why Rewards for Justice had generated so little information regarding al-Qaeda's leadership. He discovered that the U.S. Embassy in Islamabad had effectively shut down the program. There was no radio or television advertising. ...

In 2004, Congress passed a law authorizing the State Department to post rewards as high as $50 million apiece -- a provision with bin Laden in mind. Last fall, Rep. Dan Boren (D-Okla.) went further, introducing a bill that would raise the cap to $500 million. The State Department has declined to boost the reward for bin Laden, arguing that more money was unlikely to do any good and would only add to his notoriety.

Let's see, billions spent via ordinary means, and millions offered in bounties, and it is the bounties they blame for Al-Qaeda's notoriety and failing to catch leaders?  The billions are spent and gone, while the millions in bounties we only lose when they actually work.  How then is this data suggesting we should prefer ordinary means to bounties?

Here is one of my previous posts on bounties.  The Rewards for Justice program has actually brought in some big catches.

Markets in everything, Japan edition

Mobs are legal entities here. Their fan magazines and comic books are sold in convenience stores, and bosses socialize with prime ministers and politicians.

Here is the full story, which focuses on the continuing powerful role of the mob in Japan.  Get this:

The most powerful faction, the Yamaguchi-gumi, is known as "the Wal-Mart of the yakuza" [TC: do they promise "Always Lower Prices"?]  and reportedly has close to 40,000 members.

No, this is neither Bryan Caplan nor Robin Hanson

It's Sir Thomas Browne, one of my favorite writers I might add, circa 1672:

Again, Their individual imperfections being great, they are moreover enlarged by their aggregation; and being erroneous in their single numbers, once hudled together, they will be Error it self. For being a confusion of knaves and fools, and a farraginous concurrence of all conditions, tempers, sexes, and ages; it is but natural if their determinations be monstrous, and many waies inconsistent with Truth. And therefore wise men have alwaies applauded their own judgment, in the contradiction of that of the People; and their soberest adversaries, have ever afforded them the stile of fools and mad men; and, to speak impartially, their actions have made good these Epithets.

You'll find the full passage here.  The point resembles Bryan but there is something about the spirit which reminds me more of Robin.  It's one of my favorite pastimes to find passages in early texts which in some way presage Robin Hanson; this means having to reread Gulliver's Travels every now and then.  By the way, the Burial Urn and the Garden of Cyrus are probably Browne's most compelling works.

Wuthering Heights

When Dante Gabriel Rossetti read the novel Wuthering Heights, he wrote to a friend: "The action takes place in Hell, but the places, I don't know why, have English names.

That is from Jorge Luis Borges, Selected Non-Fictions.

Wheat Prices are Down

Rice prices remain high, however, although world production is up a little bit (data on rice). Hat tip to Carpe Diem.

Good sense on food prices

It seems to me odd to fault the World Bank for advice some 15 years ago to eliminate import protection--so that domestic prices could come down at the time--while at the same time complaining about high prices now, even with the benefit of hindsight.  If developing countries had all kept their import protection, the global supply of food would have been lower today, not higher. (That is because import protection would have led global production to be reallocated from efficient exporters to inefficient importers.) If you are for self-sufficiency, you must be willing to live with high prices.   

No, that's not me, that's from Dani Rodrik.

Bernanke's bubble laboratory

Manias can persist even though many smart people suspect a bubble, because no one of them has the firepower to successfully attack it. Only when skeptical investors act simultaneously -- a moment impossible to predict -- does the bubble pop.

...Mr. Bernanke hired finance experts who had broad interests and were eager to work with the university's deepening bench of theorists. He lured Dilip Abreu, known for work in game theory, back from Yale, to which he had earlier defected. Making a virtue of an institutional weakness, the absence of a business school, Princeton assimilated the finance scholars into the economics department and freed them to pursue research.

They are building on work done by the late Hyman Minsky, whose once-ignored ideas about investing manias are now in vogue, and the late economic historian Charles Kindleberger, whose 1978 "Manias, Panics and Crashes" is a classic. But compared with Mr. Minsky or another student of bubbles, Yale's Robert Shiller, the Princeton trio focuses less on mass psychology than on mathematical models. These they use to show how bubbles can be created even in markets that include rational, calculating investors.

Here is the full story, interesting throughout.

Retail loyalty card programs

From some time ago, Kevin Drum reports:

I really loathe retail loyalty card programs. 

These programs serve two functions.  First, they are a form of price discrimination.  Buyers who are willing to collect and show the cards pay lower prices while the "I can't be bothered with this ****" types pay higher prices. 

Second, retail loyalty cards enforce partial collusion ex post in an oligopolistic setting.  In other words, cards and frequent flyer programs "lock in" buyers to their favored firms.  Once that lock-in is accomplished, all firms have weaker incentives to cut price to lure away buyers from their favorites.  (The smarty-pants point is to note that firms have to give buyers a better deal upfront in anticipation of this lock-in but still if the company moves first with a non-negotiable offer it still can come out ahead and raise the P/MC ratio.)

The first function is usually welfare-improving, the second function usually is not.  Overall you personally benefit from loyalty card programs if you don't mind holding the cards (you have a thick wallet) and you have a strongly favorite company/product anyway.  In the latter case you are likely locked in anyway, so the strengthening of the lock-in effect doesn't so much restrict your freedom.  This is tricky of course because you might miss out on preemptive price cuts from your favorite firm to keep you, since maybe they don't otherwise know how much you love their stuff.  Still, I will stick with this mechanism as a plausible guess of the net effect.

You suffer from loyalty card programs if...you hate them.  Not only do the programs and the smiling clerks bug you but you are the kind of person who ends up paying more.  Which means you hate the programs even more.  Which means...

But wait: the equilibrium seems to converge and so Kevin Drum's anger at retail loyalty card programs remains, in reality, quite low. 

Brazil facts of the day

1. Brazil has become a net creditor nation for the first time in its history.

2. About 15% of the Congress is under formal investigation for crimes, ranging from attempted homicide to money laundering.

3. Since 2005 more than 20 million people have entered "the middle class," defined as a monthly income of $635.  The percentage of middle-class Brazilians has grown from 34% to 46%.

Those facts are all from "Brazil Joins Front Rank of New Economic Powers," in Tuesday's Wall Street Journal.

Economicwoman.com

That is the site address for a new blog on feminism and economics.  Allison, the blogger, points us to a YouTube channel on feminist economics.

Here is Allison's advice for economics undergraduates; feel free to add to it in our comments section.

CSI on Trial

...to judge by the most comprehensive study on the reliability of forensic evidence to date, the error rate is more than 10% in five categories of analysis, including fiber, paint and body fluids. ...DNA and fingerprints are more reliable but still not foolproof....a 2005 study in the  Journal of Criminal Law & Criminology suggests a fingerprint false-positive rate a bit below 1%, a widely read 2006 experiment shows an alarming 4% false-positive rate.

How can we preserve the usefulness of forensic evidence while protecting the public when it breaks down? The core problem with the forensic system is monopoly. Once evidence goes to one lab, it is rarely examined by any other. That needs to change. Each jurisdiction should include several competing labs. ...

This procedure may seem like a waste. But such checks would save taxpayer money. Extra tests are inexpensive compared to the cost of error, including the cost of incarcerating the wrongfully convicted....

Other reforms should include making labs independent of law enforcement and a requirement for blind testing. When crime labs are part of the police department, some forensic experts make mistakes out of an unconscious desire to help their "clients," the police and prosecution. Independence and blind testing prevent that.

That's forensics expert Roger Koppl writing in Forbes.  If anything I think Koppl is being kind to CSI.  Take bullet lead analysis a procedure used by the FBI for decades that turns out to have no scientific validity whatsoever.

Full Disclosure: Koppl's op-ed is based on a paper in a book called Law Without Romance edited by Ed Lopez to be published by Independent Institute where I am director of research.

New assorted links

1. Boltzmann brains, via Brad DeLong and here

2. Rest and home court advantage, and here

3. My old colleague Charles Lave has passed away

4. The Antiplanner blog

5. Reminiscenses of Richard Rorty, via MY

6. New science fiction TV shows coming from J.J. Abrams and Joss Wheedon

The Pixar Touch

Steve Jobs had put some $50 million into the company.  It was still reliably losing money year after year.  Now he also faced the possibility of millions more in liability; although Disney had agreed to increase its lowball $17.5 million budget for Toy Story to $21.1 million, it still wasn't enough.  By 1994, costs were expected to run some $6 million higher.  Hence, Disney forced Pixarto obtain a $3 million credit line to cover its share of the overages -- backed, if necessary, by Job's personal guarantee.  Weary of watching Pixar's deficits pile up, Jobs had tried to sell all or part of the company many times...

That is from David A. Price's The Pixar Touch, an excellent book.  It is good most of all on all the false fits and starts behind a successful entrepreneurial venture.

David Brooks, in a nutshell?

Wunderkind Ben Casnocha summarizes a talk:

David Brooks, columnist, New York Times:

• "I'll be brief because many of you are academics, and you're not here to hear me talk, you're here to hear yourselves talk."
• He likes Edmund Burke.
• People learn when there's an emotional connection.
• All factions of conservative movement united around distrust of government - this ain't enough.
• Obama's perceptiveness / self-awareness / stability is striking.
• McCain's morality is based on honor, not morality. #1 trait is aloofness - somewhat detached personality.
• Conservatism shouldn't have permanent policies (like tax cuts): don't get moral about a situational policy issue.
• Conservatism is about not knowing much; modest about what we can know/do.
• Conservatism is philosophy first, policy second. Liberalism is policy first, philosophy later.
• Conservatism values social mobility more than equality.
• Top issues in the election: bipartisanship, immigration, healthcare.
• People aren't solely self-interested economic rational creatures. If this were the case, why would 30% of students drop out of high school even though it's econ ruinous to do so?
• What's the point of being a democrat if you can't play the class card?
• Bush seems 40 IQ points smarter in private than in public.

Here's a QuickTime version of Brooks' speech.

I agree with many of these, although I am not sure that conservatism puts philosophy first.  Does it not put experience first?  Also, I think the main issue in the election is George W. Bush.

Does the simulation have an evil or indifferent designer?

On the plane I was reading Stanislaw Lem's famous essay on personoretics.  It occurred to me that if we are living in a simulation we can make Bayesian inferences about the intentions of the designer.  Let's say many designers are creating many simulations.  Will the good or the evil designers be more productive in terms of numbers of simulations created?  If we define "good" as subject to some ethical constraints, I believe the good designers work under a competitive disadvantage.  It's harder to produce cheap apples, for instance, if you pledge to do so only in a "green" way.  And so on.  Oddly the evil designers may be under a competitive disadvantage as well.  Intention has a cost and so in competitive settings it tends to fall out.  In our current world most things are made by indifferent machines.  I believe the rational inference about the simulation is that at least the demi-urge -- and possibly the Master Creator as well -- is indifferent to our plight.

Is it patronizing theft to buy natural resources?

Leif Wenar says yes:

You very likely own stolen goods. The gas in your car, the circuits in your cell phone, the diamond in your ring, the chemicals in your lipstick or shaving cream — even the plastic in your computer may be the product of theft. Americans buy huge quantities of goods every day that are literally stolen from some of the world’s poorest people.

...The very worst countries — the “sevens” — are places like Burma, Equatorial Guinea, Libya, North Korea, Somalia, Sudan and Zimbabwe. Taking these very worst countries as the places where the people could not possibly be authorizing the dictators and civil warriors to sell off their country’s resources, we can measure the amounts of stolen resources that enter America each year. By these official U.S. criteria over 600 million barrels of oil–more than one barrel in eight — have been taken illegitimately from their countries of origin. Stolen oil may be in your car’s gas tank right now. Stolen oil might have been used to make the computer mouse in your hand.

That's Leif Wenar, here is more.  He proposes suing Exxon to create a chain reaction, thereby lowering the value of dictatorial seizures of natural resources and perhaps preventing them.  I'm sure the Chinese are on board.  But no -- read further: we must sue them too.  After all, their cheap toys are made with stolen oil.

Claims about food prices

My story is about a world where...GDP growth yields fewer poor people who respond to higher wheat prices by purchasing less meat or wheat, i.e. we have less of a shock absorber. That generates a reduced elasticity of demand of wheat. So prices have to rise by more in order to clear a supply-demand imbalance than was required in the past when there were more poor people who would adjust.

Here is much more, interesting throughout.

The 100 best jazz albums?

Here is a list by David Remnick, via Jason Kottke.  It is good, albeit a bit mainstream for my tastes.  I'm glad to see he likes Ascension.  I would add more late Miles Davis (Live at Fillmore and In a Silent Way, among others), Ornette Coleman's Free Jazz, more Cecil Taylor, the Blakey/Monk album, Solo Monk (my favorite jazz album?), and some Stan Kenton as well.  I'm due to cover a reader request for contemporary jazz soon, so I'll leave the moderns out of it for the time being.

Home court advantage in basketball

We all feel the Celtic ouch and perhaps some of us delight in it.  Matt writes:

Kevin Drum notes two smart responses to the question of why home court advantage is so big, with one hypothesis pointing to the refs and another pointing to the idea that there are actually lots of differences from arena-to-arena.

Of course if the arena is the difference you would expect shooting guards, who need a good feel for the lights and angles of the basket, to have a bigger relative advantage at home than do the dunking big men.  That should be easy enough to test.  And maybe a look at Lakers-Clippers or Nets-Knicks history can clear up the importance of arena by holding geographic area constant. 

I wonder if a third component of home court advantage has to do with sleep.  People sleep better at home, if only because they don't have to go to such great lengths to get sex.  I recall reading that Larry Bird became a truly great player only once he...um...calmed down a bit.

I loved this question, and answer

Question for the day: what do libertarianism and the Many-Worlds Interpretation of quantum mechanics have in common? Interest in the two worldviews seems to be positively correlated: think of quantum computing pioneer David Deutsch, or several prominent posters over at Overcoming Bias, or … oh, alright, my sample size is admittedly pretty small.

...My own hypothesis has to do with bullet-dodgers versus bullet-swallowers.

And it ends with this:

So who’s right: the bullet-swallowing libertarian Many-Worlders, or the bullet-dodging intellectual kibitzers?  Well, that depends on whether the function is sin(x) or log(x).

Read more here and can you guess who the pointer is from?

The Storm

The storm ravaged the city’s architecture and infrastructure, took hundreds of lives, exiled hundreds of thousands of residents. But it also destroyed, or enabled the destruction of, the city’s public-school system—an outcome many New Orleanians saw as deliverance....The floodwaters, so the talk went, had washed this befouled slate clean—had offered, in a state official’s words, a “once-in-a-lifetime opportunity to reinvent public education.” In due course, that opportunity was taken:...Stripped of most of its domain and financing, the Orleans Parish School Board fired all 7,500 of its teachers and support staff, effectively breaking the teachers’ union. And the Bush administration stepped in with millions of dollars for the expansion of charter schools—publicly financed but independently run schools that answer to their own boards. The result was the fastest makeover of an urban school system in American history.

That's from The Atlantic just over a year ago.  Guess what?  It's working. The storm is coming.

New site about prediction markets

Here you will find regular updates on prediction markets, with the blog-like news function here.  You'll see there that the CFTC is requesting public comments on how to regulate "event contracts."  The site is launched by these people.

I thank Chris F. Masse for the pointer.

Predictions about religion

In their arguments with Christopher Hitchens and Richard Dawkins, the faithful have been defending the existence of God. That was the easy debate. The real challenge is going to come from people who feel the existence of the sacred, but who think that particular religions are just cultural artifacts built on top of universal human traits. It’s going to come from scientists whose beliefs overlap a bit with Buddhism.

That's from David Brooks.

Does the high oil price reflect a bubble?

Paul Krugman writes (and here):

The only way speculation can have a persistent effect on oil prices, then, is if it leads to physical hoarding — an increase in private inventories of black gunk. This actually happened in the late 1970s, when the effects of disrupted Iranian supply were amplified by widespread panic stockpiling.

But it hasn’t happened this time: all through the period of the alleged bubble, inventories have remained at more or less normal levels.

I've never been one to push the bubble hypothesis to explain the high price of oil but I find this an unusual argument to make against bubbles.  Isn't it easy enough to argue that the relevant hoarding is of oil in the ground rather than oil in strategic reserves or panic stockpiles?  We have lots of state-owned oil companies and maybe their way of speculating is simply to remain sluggish in their exploration and extraction activities, at least for the time being.

I think of a bubble as a market price which is above the fundamental value of the asset, largely for psychological reasons.  But with a commodity like oil the fundamental value of the asset depends on the marginal unit and thus how much oil is supplied.  Fundamental value, at least at the margin, adjusts to the price and in that sense the bubble hypothesis can seem tautologically false if we apply the traditional definition of a bubble. 

The key question, in my view, is how much more the oil-producing nations could bring to the market if a) their state-owned oil companies were not incompetent, and b) they did not tolerate this incompetence as an implicit form of speculation and collusion.  I will not offer an estimate here (I genuinely don't have one) but b) does leave some room for bubbly-like phenomena, whether or not stockpiles of pumped oil are high.  Note that in b) collusion and speculation work together and a) tosses incompetence into the mix.  The whole foul brew is probably easier to sustain in times of rising demand and thus oil price explanations are not going to be very simple, or easily separable, by the nature of the problem.

Addendum: Read Arnold Kling, here and here.

Hedge funds in everything

AdultVest, Inc., the Beverly Hills-based investment bank, which concentrates its practice exclusively on adult industry investments, mergers, and acquisitions, announced today it had been selected by Alternative Investment News as one of four funds nominated for the "Hedge Fund Launch of the Year" award.

Here is the link.  That's from John DePalma, who also points our attention to this Dilbert cartoon.

Questions for liberals (and some libertarians)

Robin Hanson, citing the work of Arthur Brooks, asks:

• Would you or I be happier if we let ourselves think more conservatively, such as by attending church more and believing we can pull ourselves up by our bootstraps?
• Would society be happier if we encouraged more conservative thoughts?

Robin answers that he would rather "believe whatever is true even if that makes me unhappy."  But there is always adjustment on some truthful margin that can be made.  Robin could play up the relatively conservative thoughts he already believes in and do more of the church-like activities he already partakes in, even if he does not go to church per se.  So these results probably should influence our behavior even though of course we should reject the deliberate pursuit of untruth.

Here are Bryan Caplan's thoughts on the Brooks book.

In case you were sleeping

In December, the Fed had $775B worth of Treasury securities. That stock will soon have dwindled to $300B, give or take. The difference, about $475B, represents an investment by the central bank in risky assets of the US financial sector. $475B is an extraordinary sum of money. It is as if the Fed borrowed more than $1500 from every man, woman, and child in the United States, and invested that money on our behalf in Wall Street banks that private financiers were afraid to touch. For bearing all this risk, if things work out well, taxpayers will earn about what they would have earned investing in safe government bonds.

...If the Fed were to blow through the rest of its current stock of Treasuries, it would have invested more than $2500 for every man, woman, and child in America. Public investment in the financial sector would have exceeded the direct costs to date of the Iraq War by a wide margin.

Here is much more; the Interfluidity post focuses in fact on the implications of paying interest on reserves.  The sad thing is: if I had my finger on the button, I would not have reversed these loans.  Ouch!

The Post-American World

The American political system has lost the ability for large-scale compromise, and it has lost the ability to accept some pain now for much gain later on.

That is from Fareed Zakaria's The Post-American World, a book remarkably full of common sense.  It's #7 on Amazon and a good overall guide to globalization and why it matters that America no longer dominates the world, either economically or culturally.

Hail Emily Oster!

The paper is titled "Hepatitis B Does Not Explain Male-Biased Sex Ratios in China"; here is the abstract:

Earlier work (Oster, 2005) has argued, based on existing medical literature and analysis of cross country data and vaccination programs, that parents who are carriers of hepatitis B have a higher offspring sex ratio (more boys) than non-carrier parents. Further, since a number of Asian countries, China in particular, have high hepatitis B carrier rates, Oster (2005) suggested that hepatitis B could explain a large share (approximately 50%) of Asia's missing women". Subsequent work has questioned this conclusion. Most notably, Lin and Luoh (2008) use data from a large cohort of births in Taiwan and find only a very tiny effect of maternal hepatitis carrier status on offspring sex ratio. Although this work is quite conclusive for the case of mothers, it leaves open the possibility that paternal carrier status is driving higher sex offspring sex ratios. To test this, we collected data on the offspring gender for a cohort of 67,000 people in China who are being observed in a prospective cohort study of liver cancer; approximately 15% of these individuals are hepatitis B carriers. In this sample, we find no effect of either maternal or paternal hepatitis B carrier status on offspring sex. Carrier parents are no more likely to have male children than non-carrier parents. This finding leads us to conclude that hepatitis B cannot explain skewed sex ratios in China.

We should hold up Emily Oster as a role model of a truth-seeker.  If the abstract does not make it clear, Emily Oster first won her fame by reporting the opposite result about sex ratios.  Here are our previous posts on Emily Oster.

A more general lesson, of course, is simply how difficult it is to get at truth.  This is a well-defined data set with a (more or less) well-defined answer.  Most policy questions aren't so tractable.

"As a child, Peter Leeson was pirate-obsessed."

That's the first sentence of the article, read more, from The Boston Globe.

Why aren't more people going to college?

Brad DeLong writes:

Altonji, Bharadwaj, and Lange do not know.

The whole post is interesting, but from this I can only conclude that Altonji, Bharadwaj, and Lange have never taught Introduction to Composition to a large group of freshman in a public university in the United States.  Anyone who has taught such a class -- or for that matter talked to anyone who has -- will have some inkling why more people are not going to college.  Herein lie the roots of growing inequality -- on the bottom side at least -- and don't let anyone induce you to take your eye off the ball by playing switcheroo and bringing up the (separate) topic of the growing wealth of the top one percent.

Economists who have endorsed John McCain's economic plan

Gary Becker, James Buchanan, Robert Lucas, Robert Mundell, Vernon Smith, Michael Boskin, John Cogan, Steven Davis, Francis X. Diebold, Martin Eichenbaum, Martin Feldstein, Kevin Hassett, Douglas Holtz-Eakin, Glenn Hubbard, Anne Krueger, Deepak Lal, Burton Malkiel, Paul W. McCracken, Allan Meltzer, Tim Muris, June O'Neill, Michael E. Porter, Kenneth Rogoff, Richard Roll, Harvey Rosen, George Shultz, Beryl Sprinkel, John Taylor, and Arnold Zellner.

I was sent that list in an email.  The opening of the statement reads:

We enthusiastically support John McCain's economic plan. It is a comprehensive, pro-growth, reform agenda. The reform focuses on the real economic problems Americans face today and will face in the future. And it builds on the core economic principles that have made America great.

His plan would control government spending by vetoing every bill with earmarks, implementing a constitutionally valid line-item veto, pausing non-military discretionary government spending programs for one year to stop their explosive growth and place accountability on federal government agencies.

No, I don't do endorsements but if I were tempted to (and I'm not) I would this year be even more suspicious than usual.  I feel that the candidates are trying to trick me and the one who isn't -- Hillary Clinton, whose negatives are too transparent to my eyes -- has been trying to trick everyone else. 

I'll put the rest of the letter in the first comment, but in the meantime my advice -- at least for this year -- is to vote on the basis of foreign policy.

True beyond the shores of Harvard

Blog post of the day, from Brad DeLong, excerpt:

Somebody last week--was it Jan de Vries? John Ellwood? Somebody else? I forget who, but it is not original to me--said that the right model for Harvard over the past century is Yugoslavia. Remember the story of the Yugoslavian socialist worker-managed firm? If you add another worker to the firm, that worker gets a pro-rata share of the firm's value added. The firm's value added has a component attributable to the firm's capital stock, a component attributable to the ideas embedded in the firm, a component attributable to the firm's market position, and a component attributable to the workers. Hire another worker, and only the last of these goes up: the first three do not, and so average compensation falls.

This means that a worker-managed firm is likely to shrink whenever it gets good news that makes it more productive--the larger is the value added due to ideas, capital, or market position, the more expensive does it become for the existing workers to replace workers who leave, let alone hire enough workers to expand. While a competitive market capitalist firm responds to good news about its productivity and value to society by increasing employment, a Yugoslavian-model market socialist firm responds to good news about its productivity and value to society by shrinking. On this analysis, the very success of Harvard over the past two generations together with its degree of worker management has created enormous internal pressures not to expand, the better to share out the surplus among the existing stakeholders.