Month: March 2015

It seems like one can’t go anywhere on the internet without being exposed to some sort of obnoxiously catchy title that is practically begging to be clicked on. Whether it’s a slideshow of before-and-after weight loss pictures that will “blow your mind,” or an article talking about an obsolete cultural phenomenon that “only 90s kids will understand,” these links have permeated nearly every social media site and search engine. These attention-seeking articles are known as linkbait. Linkbait (also known as clickbait, although some people argue that they are different), is a type of digital advertising technique that showcases a story with a provocative Continue reading The Economics of Buzzfeed→

At first blush, Jeopardy and spreadsheets might seem like they don’t have a lot in common. However, together they illustrate the quantum leap economic automation is poised to take. NPR’s Planet Money recently ran a great episode on the genesis of computer spreadsheets. In a nutshell, before computer spreadsheets accounting clerks kept giant paper spreadsheets by hand. This was a laborious, error-prone system. Once computer spreadsheets arrived on the market, those clerical positions began to evaporate. However, non-clerical accounting positions expanded rapidly. The computer spreadsheet also allowed the financial sector to grow rapidly. So there was a loss of jobs due to automation, Continue reading Spreadsheets, Jeopardy, and Automation→

If you are familiar with the idea of risk aversion, our innate preference for a sure outcome over a gamble that would result in an equivalent or higher expected value, the concept of ambiguity aversion is very similar. It claims that people show a preference for known risks over unknown risks. Ambiguity aversion differs from risk aversion because it applies to situations in which probabilities of outcomes are unknown, while risk aversion is based on scenarios where a probability can be assigned to each possible outcome. The famous experiment used to describe this idea, the Ellsberg paradox, begins by presenting Continue reading Ambiguity Aversion: Avoidance of the Unknown→

Most stores have strict rules and regulations they follow when it comes to shoplifting. The purpose of loss prevention departments is to spot thieves and recover stolen items. When a person is caught or suspected of using the five-finger discount, many stores have the very limited right to make citizen’s arrests and/or search the individual (e.g. shopkeeper’s privilege). However, some stores are no longer arresting or searching suspected shoplifters, but instead giving people a choice: they can take a $320 class and walk out scot-free, or the store calls the cops. The Corrective Education Company (or CEC) is a Utah-based business founded Continue reading The Shoplifting Fee→