One of the world’s great entrepreneurs, possibly the greatest media person of our generation, discusses the free market.

This is the prisoner’s dilemma – famous across the wide expanse of economics – as described in this article about Nobel Prize winners:

The police arrests two criminal partners and puts each in a solitary confinement where they cannot communicate. If neither of the criminals cooperates with the police, they will send each criminal in jail for one year. If one criminal testifies against his partner, he will go free while the partner will get three years in prison. If both prisoners testify against each other, both will get two years in jail.

Nash Equilibrium is when no game participant can improve his outcome when all other participants keep their strategy. In Prisoner’s Dilemma, such equilibrium happens when both criminals testify against each other and get two years each. If either of them changes strategy, he gets an extra year in jail. Of course, both criminal partners will be better off if neither of them testify since they will get one year each. However, in such case either of them can improve his outcome by testifying. Nash Equilibrium in Prisoner’s Dilemma shows that egoistic strategies in non-cooperative games can lead to common bad.

It is true, of course, that these two crims both go to jail an extra year each because for each of them their optimal strategy is to rat on the other. But good, they should both go to jail and for the longer time. From their own point of view they are worse off, but from a social perspective this outcomes seems all right to me. Where’s the “common bad”?

Are there outcomes where from a social perspective we all end up worse off because each person does what is best for themselves? There no doubt are, but the most famous of all examples does not demonstrate that society is the worse off because of the dilemma these two criminals face.

Incidentally, the article also points out that Paul Krugman is the most googled Nobel Prize winner in economics. I don’t know what it shows other than that hits on google is a very bad indicator of the value of what an economist has to say.

This online video series documents the success stories of Steve Jobs, Mark Zuckerberg, Bill Gates, Philip Knight, Richard Branson and Ingvar Kamprad. This collection of 6 films provides the viewer with insights into how some of the most powerful organisations were created. Complimented with unpublished testimonials from relatives and partners, the films reveal the challenges faced by these entrepreneurs in today’s economy.

View the full videos here.

It is people of genius free of government interference to the extent necessary to get their businesses moving that cause growth and innovation. The direct role of government is infintesimal. The only role is to ensure there is enough social space and the right kinds of regulation that will not just allow but encourage such change.

An article by Boris Johnson, the mayor of London, on why a free press lowers the level of corruption and leads to a stronger economy.

OK, don’t take it from me. Listen to the voice of international business. Every year they do surveys, and they ask global executives to name the best place to do business – and every year London is named number one commercial capital in Europe, if not the world.

I could offer you all sorts of glib explanations. We have an outstanding financial centre; we have more green space than any other European city, more museums than Paris, less rainfall than Rome, twice as many bookshops as New York (and about a quarter of the murder rate). Crime has fallen 13 per cent in the past four or five years – to pick a period entirely at random.

We now boast a fast-improving transport network that includes the best bike hire scheme on earth, and a beautiful new hop-on, hop-off Routemaster-style bus. We have just put on a fantastic Olympic and Paralympic Games that showed off some of London’s opportunity areas, where the money is now piling in – as if from bullion-bearing spaceships that have been circling the planet for the past five years in search of the safest place to land.

All these are fabulous advantages, and yet I don’t think they quite explain the world’s confidence in London as a location to trade and invest. When the moneymen are deciding where to do a deal, there is something more fundamental that brings them here – a feature of our culture and society that has been true for hundreds of years.

They know that London is about as uncorrupt as any jurisdiction on earth. They know that the deal will be honoured. They know that the law will be clear, and that their security to title is good. They know that they will not be tipped out of their hotel beds before breakfast and detained by the emanations of the state. They know that they will not be imprisoned without trial. They know that to do a deal in London, you don’t have to cut some minister in on the action, or employ their half-witted relative.

You cannot hope to win a contract in London by sending some public official a Rolex or a midnight poule de luxe; and that is because that official would be too amazed to accept, too honourable to accept, and above all too terrified to accept. British business, and British politics – and the nexus between business and politics – have been kept cleaner than in virtually all other countries because for centuries we have had a free press.

It was in the late 18th century that the libertine MP and Mayor of London John Wilkes had his epic battles with the governments of George III, and vindicated his right to publish his scabrous views of that government, as well as an idiotic and pornographic poem. It was in the following decades that London grew into the richest and most powerful city on earth – the first since imperial Rome to be home to a million souls.

There can be absolutely no doubt that this rise to commercial greatness was partly made possible by those freedoms won in the 18th century – an independent judiciary; habeas corpus; freedom of assembly; the right of voters to choose their representatives; and above all the freedom of the press to speak truth to power: to ridicule, to satirise – even to vilify – and to expose wrongdoing.

Of course, not every businessperson or investor may personally relish the exuberance and ferocity of the British media. They may not enjoy reading about their salaries, yachts and subterranean swimming pools. But they also know – or should rationally accept – that it is the very boldness of the British press, and its refusal to be bullied or cowed, that makes those deals risk-free and helps them create the wealth they enjoy. Like any strong detergent, the work of the British media may cause a certain smarting of the eyes. But if you want to keep clean the gutters of public life, you need a gutter press.

Since the days of Wilkes, the media have been lifting up the big, flat rocks to let the daylight in on the creepy-crawlies; and in all that time we have never come close to the state licensing of newspapers. Not, that is, until today, when MPs must vote on the potentially calamitous proposals put forward by Labour and the Lib Dems.

Everyone accepts that the papers have behaved with vileness and stupidity towards the McCann family, and the bereaved relatives of Milly Dowler. Everyone wants to protect innocent members of the public from such bullying and abuse, and all would now accept that the old Press Complaints Commission was about as much use as a chocolate teapot.
Yes, as some of us have been saying since long before Leveson was even a twinkle in the PM’s eye, it would be a good thing if there was a beefed-up regulatory body that had the power to impose rapid and draconian fines and to demand apologies for the falsehoods and intrusions perpetrated by all contracting papers.

But if Parliament agrees to anything remotely approaching legislation, it will be handing politicians the tools they need to begin the job of cowing and even silencing the press; and what began by seeming in the public interest will end up eroding the freedoms of everyone in this country. It is a completely retrograde step, and will be viewed with bemusement by human rights organisations around the world.

All my life I have thought of Britain as a free country, a place that can look around the world with a certain moral self-confidence. How can we wag our fingers at Putin’s Russia, when we are about to propose exemplary and crippling fines on publications that do not sign up to the regulatory body? How could we have criticised the Venezuela of Hugo Chavez?

I wholly approve of the stance taken by my fellow Daily Telegraph columnist Fraser Nelson in refusing to sign up to any of it, and if I were editing The Spectator today, I hope I would do the same. It is time for Parliament to remember the commercial and political freedoms that made this country great. Think of Wilkes, and Liberty, and vote this nonsense down.

An article by Meagan McArdle, “Why Do Economists Urge College, But Not Marriage?“, reaches this conclusion after having made the point that marriage is as good for one’s life prospects as a university degree:

All economists are, definitionally, very good at college. Not all economists are good at marriage. Saying that more people should go to college will make 0% of your colleagues feel bad. Saying that more people should get married and stay married will make a significant fraction of your colleagues feel bad. And in general, most people have an aversion to topics which are likely to trigger a personal grudge in a coworker.

There are lots of things worth saying that people don’t say because it will annoy someone else so they never get said at all and disappear from polite conversation. But for someone to get the benefits from marriage, the marriage must stay intact for otherwise it is a very bad bet for any male. The following is from an article titled, “Study of Men’s Falling Income Cites Single Parents“. The argument, basically stated is this:

The decline of two-parent households may be a significant reason for the divergent fortunes of male workers, whose earnings generally declined in recent decades, and female workers, whose earnings generally increased, a prominent labor economist argues in a new survey of existing research.

If we are looking at what will allow men the highest disposable incomes, avoiding marriage and university may be the best strategy of all as this comment at Instapundit makes clear:

I think most men would deny they’re in decline. Men are having just as much sex but without the legal liabilities marriage impose on them. All I’m hearing from women in these articles is that men need to grow up and take responsibility for their actions, meaning they need to legally sign a paper imposing government sanctions on them if said marriage dissolves. There is no question that men are getting the shaft from the courts financially when divorce occurs. Furthermore women are also more likely to get custody of any children as well as more decision making responsibility.

Men have wised up after hearing horror story upon horror story from their older friends and family when the court system utterly destroyed their lives and have simply decided to go galt from the entire marriage process.

Divorce courts have become the ultimate nanny state intrusion into the lives of men and the average man has decided that it simply is not worth the risk. Exactly how is that irresponsible to the man? This is the ultimate unexpected consequence Virginia slim gets.