CHAPTER 3 Predictions
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Never make predictions, especially about the future.”
Note:CHI HA PARLATO COSÌ? DIFFICILE DIRLO
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“inventions have long since reached their limit, and I see no hope for future development.”
Note:SEXTUS JULIUS FRONTINUS NEL 100 dC
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“there is a world market for maybe five computers.”
Note:PRESIDENTE IBM NEL 1946
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no more than ten years away from having a nuclear-powered vacuum cleaner.
Note:NEL 1955 ALEX LEWYT
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tongue-in-cheek,
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1 Pigs in a Box
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At the far end of the box—several pig’s lengths away—is a bowl that fills with food whenever the lever is pressed. Which pig do you predict will eat better?
Note:PUZZLE DEI DUE MAIALI UNO GROSSO E UNO PICCOLO...CHI AZIONERÀ LA LEVA?
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the little pig has absolutely no incentive to press the lever, having quickly learned that if he does, the big pig will steal all the food.
Note:RIAPOSTA
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2 Boys or Girls?
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most parents prefer sons to daughters. Do you expect to get more requests for boys or for girls?
Note:HAI APERTO UN AGENZIA DI ADOZIONI
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even when they have a strong preference for boys, tend to have a lot of other strong preferences—including a strong preference for healthy, well-behaved children.
Note:GUESS...RAGAZZE
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They’re kids with health problems, kids with behavior problems, kids whose parents can’t raise them, and (given what the problem tells us about parental preferences in this time and place) girls.
Note:CHI VIENE OFFEERTO IN ADOZIONE DI SOLITO?
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As long as parents prefer boys, they’ll tend to cut their sons more slack than they cut their daughters. Therefore (on average, of course), boys have to be really bad to get thrown into the adoption
Note:LA LOGICA
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whether parents in general prefer boys or girls.
Note:ALTRO ARGOMENTO...SI RIEVOCA L ARTICOLO DEL 2003
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parents of boys are less likely to divorce
Note:PRIMO DATO
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parents of girls are more likely to try for another child
Note:SECONDO DATO
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Unmarried couples, upon learning the sex of their unborn child, are more likely to marry if the child is a boy.
Note:TERZO DATO
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adoption agencies get more requests for girls—and
Note:L BIEZIONE DI MOLTI...COME ABBIAMO VISTO PROVA IL CONTRARIO
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3 Kids at School
Note:TtttttttttttCORRELAZIONE CAUSAZIONE
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children from four-child families do significantly worse in school than children from three-child families.
Note:SUPONIAMO CHE...
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You already have three children and have just discovered that you’re pregnant with a fourth.
Note:COSA PREVEDI SUL PROFITTO DEI TUOI FIGLI?
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once you get past two children, the larger the family, the worse the kids perform.
Note:QUESTO SEMBRA CONFERMATO...
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this correlation is not causal.
Note:D ALTRONDE
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Parents who choose to have four children are generally less educated
Note:INFATTI
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of course your own decision to have a fourth child doesn’t change you into a different sort of person.
Note:IL QUARTO IN ARRIVO NN CAMBIA NULKA!!!!
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How do we know that it’s the demographic characteristics of large families, and not the family size itself,
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DISCERNERE CORELAZIONE E CAUSA
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looked at families with four children where the last two are twins.
Note:UN METODO PER DISCERNERE
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It turns out that their children tend to perform a lot like children from three-child families,
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Another clever strategy is to look at four-child families with, say, three boys followed by a girl
Note:ALTRA STRATEGIA
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lot of these families probably planned to stop at three but then took one final stab at gender diversity.
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Once again, their kids perform a lot like children from three-child families.
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birth order
Note:CONTA ANCHE QUESTO
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fourth children do worse in school than third children, and therefore bring down the family average
Note:ANXHE X QS LA FAMIGLIA DA 4 FA PEGGIO A SCUOLA
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Mozart was the youngest of seven children, and Benjamin Franklin was the youngest of fifteen.
Note:È SOLO UNA STATISTICA
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4 Birth Control
Note:TtttttttttttttPELTZMAN
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If a new method of birth control is safer, cheaper, more effective, and easier to use than any existing method, what do you predict will happen to the number of unwanted pregnancies?
Note:QUESITO DI PELTZMAN
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some people will switch from abstinence to the new method, or switch from having sex once in a while to twice in a while.
Note:SWITCH
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5 Cutting Back on Smoking
Note:TttttttttttttttDOMANDA E FFERTA
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Nosmo King is an antismoking crusader
Note:IL MILITANTE ANTIFUMO CHE BUTTA 100 SIGARETTE PENSANDO CHE VERRANNO FUMATE 100 SIGARETTE IN MENO
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takes the cigarette and throws it away,
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once you give a cigarette to Nosmo, you run out a little sooner,
Note:QUEL CHE SUCCEDE
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The convenience store where you do your shopping runs low
Note:E POI...
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leading its supplier to run out a little sooner.
Note:E POI.....
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increase in the demand for cigarettes
Note:DI FATTO
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slightly higher price.
Note:EFFETTO SUI PREZZI
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If they produce, say, an additional 7, and if Nosmo discards 20, then the number smoked falls not by 20 but by 13.
Note:CI SARANNO MENO DI 100 SIGARETTE NN FUMATE!
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an activist group asks people to go meatless for a day or a week
Note:LA STESSA LOGICA X LE CAMPAGNE ANIMALISTE...L ABBASSAMENTO DEI PREZZI NE MINA L EFFICACIA
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the fall in demand leads to a fall in price,
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6 Cutting Hairs
Note:TttttttttttLEGGE DI BAUMOL
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Barbers, for example, will probably be no more productive in the year 2050 than they are today.
Note:GRANDI AUMENTI DI PRODUTTIVITÀ PRODUCTIVITy N FUTURO...MA...
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wages of the average barber, relative to those of the average worker, will be higher or lower in 2050
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COSA PREVEDI?
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barbers, even though they’ll be no more productive, will see their wages rise in tandem with everyone else’s.
Note:RISPOSTA
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higher wages on (say) the auto assembly line tend to lure barbers away from haircutting.
Note:POCA OFFERTA IN FUTURO
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rising productivity in some industries leads to higher wages in other industries
Note:LEGGE DI BAUMOL
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It takes your barber about ten minutes to provide a basic haircut. It took your grandfather’s barber about the same. In other words, your barber is no more productive than your grandfather’s. But your barber is a lot richer than your grandfather’s barber,
Note:BAUMOL SPIEGA BENE ANCHE IL PASSATO
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I still grade essays at about exactly the same rate as my predecessors
Note:LA PRODUTTIVITÀ DEGLI NSEGNANTI NN È CRESCIUTA...AL CONTRARIO DI QUELLA DEGLI AGRICOLTORI
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Nevertheless, I earn a lot more than they did, because a lot of potential teachers have instead become, if not farmers, then computer programmers or financial analysts,
Note:TUTTAVIA LA RICCHEZZA DI UN RIGUARDA NSEGNANTE È CRESCIUTA MOLTO
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7 The Organ Eater
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If Leopold comes into a nice inheritance, what happens to his kidney consumption?
Note:LEOPOLDO IL GOLOSONE DI INTERIORA...EFFETTO REDDITO O EFFETTO SOSTITUZIONE?
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8 The Price of Bread
Note:tttttttttttttMANZONI E ASSALTO AI FOENI
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price ceiling on wheat,
Note:EFFETTI DI UN CONTROLLO DEI PREZZI
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What happens to the price of bread?
Note:DOMANDA
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the price of wheat just fell, so farmers will supply less wheat
Note:PREZZI BASSI....TAGLIO ALLE SCORTE
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If there’s less wheat, there’s got to be less bread—which drives the price up,
Note:EFFETTO SUI PREZZI
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wheat has become harder to find.
Note:VEDI MANZONI
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They’re paying less to the farmer but spending a lot more time scrounging around trying to find a farmer who’s willing to sell to them.
Note:FORNAI E MERCATO NERO....OPPURE ESAURIMENTO SCORTE
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9 Cars and Bars
Note:TttttttttttMONOPOLIO
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In a town with just one auto mechanic but several bars, a new law requires each business to contribute $20,000 a year toward the construction and maintenance of city parks.
Note:AUMENTERANNO DI PIÙ I PREZZI DELLE RIPARAZIONI O DEI CAPUCCINI?
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There’s no reason on earth for the price of a car repair to change.
Note:IL MONOPOLIO È GIÀ AL PREZZO MASSIMO
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losing your suitcase is no reason to alter your business practices.
Note:PERDERE DEI SOLDI
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10 Tickets at the Ballpark, Take One
Note:TttttttttttttRIPETIZIONE MONOPOLI...VERSIONE RONALDO
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A famous Chicago Cubs baseball player demands a $10 million raise,
Note:AUMENTERANNO I BOGLIETTI?
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is a lot like being forced to contribute an extra $20,000 a year to park maintenance—it’s
Note:VEDI SITUAZIONE PRECEDENTE
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Ticket prices are already set to maximize profit.
Note:OVVERO
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11 Tickets at the Ballpark, Take Two
Note:TttttttttttttI DIPENDENTI DEL MONOPOLISTA
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The Chicago Cubs play at Wrigley Field, where the ushers have just demanded and received a substantial raise.
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E ORA CHE SI FA CON IL PREZZO?
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if your ushers get a raise, you can lessen the pain by hiring fewer ushers.
Note:Il CUSTODE NN È RONALDO
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you might prefer to sell fewer tickets, as the ushers’ primary job is to monitor the behavior of unruly fans.
Note:IL PREZZO DEI BIGLIETTI SI ALZEREBBE
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Unlike a $20,000 annual contribution to the parks department, these are costs he can reduce
Note:LA DIFFERENZA
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12 Trolls on a Bridge
Note:TtttttttttttttttDOPPIO MONOPOLIO
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If you have to pass through two tollbooths to get across a bridge, would you prefer the two booths to be owned by one troll or by two different trolls?
Note:QUESITO
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One troll is better than two.
Note:RISPOSTA
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For a troll who owns a tollbooth, a $1 price increase is punished by the loss of, say, 10 customers at that booth. For a troll who owns both tollbooths, a $1 price increase is punished by the loss of 10 customers at both booths.
Note:L UNICO DETERRENTE AI PREZZI ALTI È LA PAIRA DI XDERE DEI CLIENTI
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13 Software Pricing
Note:TttttttttttttttMICROSOFT OFFICE...UN MODO X COMBATTERE I MONOPOLI È CONCENTRARLI
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would you prefer to see Microsoft broken up into two separate monopolies, one selling Windows and the other selling Office?
Note:DOMANDA PARALLELA ALLA PRECEDENTE
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One troll is still better than two.
Note:ANCORA
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The only thing preventing Microsoft from charging astronomical prices is the fear of losing customers.
Note:ANCORA
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14 Merge Ahead, Take One
Note:ttttttttttttt FUSIONI...EFFUSIONI DEM
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A monopoly tire company merges with a monopoly rubber company.
Note:AUSPICABILE?
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You should welcome the merger. One troll is still better than two.
Note:ANCORA
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Do you hear an echo? The solutions to the three preceding problems are essentially identical.
Note:CONCLUSIONE
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15 Merge Ahead, Take Two
Note:Nttttttt REGOLE GENERALI SUI MONOPOLI
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Three major computer manufacturers are seeking permission to merge into one giant company.
Note:IL CASO. SEI TRISTE O FELICE? UNA COALIZIONE DI COMPETITOR SI OPPONE
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If the merger were likely to raise prices, the smaller companies would be applauding it. When the big guys raise their prices, the little guys can follow suit.
Note:L OPPOSIZIONE DEGLI ALTRI PRODUTTORI È RASSICURANTE X IL CONSUMATORE
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As a general rule, firms welcome monopoly power even when they’re not part of the monopoly.
Note:REGOLA GENERALE
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If a coalition of well-informed consumers were vocally opposing the merger,
Note:SAREBBE DIVERSO
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vertical integration is nearly always a boon to the consumer, while horizontal integration can go either way—but
Note:REGOLA GENERALE
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16 Life in Pullman
Note:TtttttMONARCHIA
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Pullman owned all the housing and rented it to the workers. It also owned grocery stores, where the workers shopped.
Note:IL PADRONE DELLA CITTFÀ
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Pushman had many competing employers, many competing landlords, and many competing grocery stores.
Note:LA CITTÀ COMPETITIVA
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where would you expect groceries to be more expensive—in Pushman or in Pullman?
Note:LA DOMANDA
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You should expect grocery prices to be the same in both towns.
Note:RISPOSTA
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Pullman, being a profit maximizer, presumably pays its workers just enough to keep them from moving to Pushman in search of a better life.
Note:SI VOTA COI PIEDI...RICORDIAMOLO
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Even if all you care about is the university’s bottom line, losing $10,000 at the restaurant can be worth it if the alternative is to make the campus so unpleasant that you’ve got to start offering higher wages to keep people around.
Note:ILPIACEVOLE RISTORANTE DELL UNIVERSITA CHIUSO X DEFICIT
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if we accept the logic that led to the restaurant closure—that each division is to be judged by its individual profits—then the first thing we should do is close the library.
Note:CHE FACCIAMO?CHIUDIAMO ANCHE LA BIBLIOTECA?
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Pick a stock at random, tell 256 people its price is about to go up, and tell another 256 it’s about to go down. After a week, when one of your forecasts has proved accurate, take the 256 people who got the accurate forecast, divide them into two groups of 128, tell one group that some other randomly chosen stock is about to go up and tell the other that the same stock is about to go down. After another week, you’ve provided 128 people with two accurate forecasts in a row. Divide them into two groups of 64, and repeat. Pretty soon you’re down to 8 people who have heard you make six accurate forecasts in a row. Tell them that if they want your next forecast, they’ll have to pay for it.
UN METODO X FAR SOLDI
