He created incentives that 11-year-olds could relate to. (Somehow, "Come to school and you’ll be better off in 20 years," just wasn’t working.)
Tagged with “money” (18)
The fiscal cliff, for all its grand theater, really comes down to people in a room trying to come to an agreement. People doing whatever it takes to get what they want from the other side.
On today’s show, three professional negotiators walk us through techniques that members of Congress may be using right now. They explain these techniques not with textbooks, but with examples from their everyday lives.
The race for ever-faster trades has "absolutely no social value," says a billionaire who helped bring computers to financial markets.
Instapaper is a little app that started out as a side project. Now it’s a thriving one-man business. We talk to Marco Arment, Instapaper’s founder and sole employee, about the app economy.
Botanist Nicholas Money’s book Mushroom takes readers inside the world of the fungal organisms that appear overnight on lawns, are occasionally poisonous and appear in everything from Alice in Wonderland to some lifesaving medications.
You rarely see lard on menus. There aren’t shelves and shelves of it in every supermarket. In this country, we’ve sort of lost touch with the once beloved pig fat.
On today’s podcast, we ask — who killed lard? Was it Upton Sinclair? His novel, The Jungle, contained this memorable passage about the men who cook the lard:
"…and as for the other men, who worked in tank rooms full of steam, and in some of which there were open vats near the level of the floor, their peculiar trouble was that they fell into the vats; and when they were fished out, there was never enough of them left to be worth exhibiting,— sometimes they would be overlooked for days, till all but the bones of them had gone out to the world as Durham’s Pure Leaf Lard!"
Or should we blame William Procter and James Gamble? It was their company which created a new alternative to lard — the "pure and wholesome" Crisco.
New York Times columnist Mark Bittman talks about taxing unhealthy foods. His article in the Times’ Sunday Review on July 24, “Bad Food? Tax It, and Subsidize Vegetables,” looks at why it’s so difficult to market healthy foods successfully.
An airline, the price of oil and the financialization of the global economy. On today’s show, author and former banker Satyajit Das talks about his career and the trouble with the rise of finance.
There’s a tiny island called Yap out in the Pacific Ocean. Economists love it because it helps answer this really basic question: What is money?
There’s no gold or silver on Yap. But hundreds of years ago, explorers from Yap found limestone deposits on an island hundreds of miles away. And they carved this limestone into huge stone discs, which they brought back across the sea on their small bamboo boats.
It’s unclear if these stones started as money. But at some point the people on Yap realized what most societies realize. They needed something that everyone agrees you can use to pay for stuff.
And like many societies, the people of Yap took the thing they had that was pretty — their version of gold — and decided that was money.
A piece of stone money was really valuable; you wouldn’t use it for some everyday purchase. You’d use it for something big — a daughter’s dowry, say.
"If somebody was in real dire straits, and something happened to their crop of food or they were running low on provisions and they had some stone money, they might trade," says Scott Fitzpatrick, an anthropologist at North Carolina State University who is an expert on Yap.
One key thing about this money: It was really heavy. A big piece could weigh more than a car.
As a result, this very concrete form of money quickly made the jump to being something very abstract.
"They often talk about the stones themselves not changing hands at all," Fitzpatrick says. "In fact, most of the time they wouldn’t."
So imagine there’s this great big stone disc sitting in a village. One person gives it to another person. But the stone doesn’t move. It’s just that everybody in the village knows the stone now has a new owner.
In fact, the stone doesn’t even need to be on the island to count as money.
One time, according to the island’s oral tradition, a work crew was bringing was bringing a giant stone coin back to yap on a boat. And just before they got back to the island, they hit a big storm. The stone wound up on the bottom of the ocean.
The crew made it back to the island and told everybody what happened. And everybody decided that the piece of stone money was still good — even though it was on the bottom of the ocean.
"So somebody today owns this piece of stone money, even though nobody’s seen it for over 100 years or more," Fitzgerald says.
This system, in the end, feels really familiar. If you go online to pay your electric bill, what’s really changing in the world?
Some digits in your bank account get shifted around, along with some digits in the power company’s bank account.
In other words, that stone money on the bottom of the ocean that you used to own now belongs to the power company.
Our headline has been used before. It’s the name both of a book about Yap, written a century ago, and a 1991 paper by the economist Milton Friedman, who compared Yap’s monetary system to the gold standard.
In the 16th century, coffee shops prominently displayed coin boxes with the phrase "to ensure prompt service" written on the side. If you wanted your coffee in a hurry, you dropped a little something extra in the box, and made sure the waitress saw you do it.
This, according to at least one version of history, is where tipping began.
But today, we tip after we get served, not before. And, according to one expert we talk to on today’s podcast, the quality of service we perceive makes a tiny difference in how much we tip. (The weather has a comparable influence on tip size.)
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