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Saturday, April 14, 2007

An Economic Analysis of the Protestant Reformation

"This paper seeks to explain the initial successes and failures of Protestantism on economic grounds. It argues that the medieval Roman Catholic Church, through doctrinal manipulation, the exclusion of rivals, and various forms of price discrimination, ultimately placed members seeking the Z good "spiritual services" on the margin of defection. These monopolistic practices encouraged entry by rival firms, some of which were aligned with civil governments. The paper hypothesizes that Protestant entry was facilitated in emergent entrepreneurial societies characterized by the decline of feudalism and relatively unstable distribution of wealth and repressed in more homogeneous, rent-seeking societies that were mostly dissipating rather than creating wealth. In these societies the Roman Church was more able to continue the practice of price discrimination. Informal tests of this proposition are conducted by considering primogeniture and urban growth as proxies for wealth stability."


Why can't we have funky stuff like this in the Premier Institution of Social Engineering?!


THE COPYING PRACTICES OF FRENCH INTERNET USERS: AN ECONOMIC ANALYSIS

"Copying behaviour is not the result of a rational cost-benefit financial assessment – the individual does not copy as a function of a benefit (amounting to saving the price of a CD) which he would compare with a cost (being taken to court and punished), but as a function of a "viral" effect: the individual copies because his peers copy, and the more his peers copy, the more he himself copies. This phenomenon of the circulation of a behaviour from peer to peer certainly explains the
disappointing results of the current policy of suppression in place in most countries...

Three strategies are possible for dealing with P2P:

(1) Suppression (court cases against individuals, reinforcement of legal protection, etc.), which is widely used at present.
Our results call into question not only the effectiveness of this strategy, but also its economic foundations: it is largely based on a hypothesis consisting of a purely substitutive principle which holds that the principal effect of copying is to eat into sales.

(2) Non-intervention, which has historical precedents such as early cinema, and radio competing with records.
The hypothesis is that, at worst, copying has no effect (on the drop in sales) and that, at best, it has a positive impact on the cultural industries. In this case, the least costly solution socially consists in leaving the stakeholders to innovate and negotiate between themselves, while ensuring respect for competition law and privacy.

(3) Tolerance accompanied by compensation (for example based on the model of perceived royalties for photocopying books and magazines).
The underlying hypothesis is that all work deserves payment (idea of the philosopher John Locke, 1690). Our study shows that copiers are prepared to pay the artists, and all the more so because their copying practices cause them concerns of an ethical nature. Therefore, the entire difficulty lies in defining a socially viable compensation mechanism (that is to say fair, feasible and acceptable).

In view of the results of the survey, solutions (2) and (3) are preferable."
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