Analysis using Porter’s five forces model in Marketing

On analyzing the case we will seek to look at two relevant barriers to entry; namely, product differentiation and economies of scale. The economy of scale refers to the decline per unit in product cost as the volume of production increases. Levi’s could have exploited opportunities to outsource their production facilities where labour is cheaper, in order to mass produce and have a cost advantages. Volumes of jeans have been produced in this market because other labels such as Arizona Jeans have exploited the opportunity. If they exploit the opportunity it means that they could produce for less and sell at a higher cost to their profitability. The Levi’s brand has product differentiation because there is a history of brand loyalty; the product carries enough clout to justify a reasonable price premium. They had embarked on a project to create a niche market to attract higher income customers who were willing to pay a premium for a perfect fit. In this case the threat would be brand loyalty because there are a lot of producers of jeans. Threat of Rivalry Threat of rivalry includes all distributors and stores that sell jeans. Example of stores is the likes of JC Penny stores who were once a business alliance, they have sought out cheaper alternatives such as the Arizona brand of jeans and have become their competitor; there is also Gap, Lee and Wrangler. Each of these brands has their own market or customer base. With all of these competitors in the market there is likely competitive pricing for the product. Threat of Substitutes There are other forms of clothing that can substitute for jeans example cotton, linen and other forms of material that makes clothing. In this case though Levi’s has created a â€Å"personal pair for a perfect fit† this proposal has created the niche market for Levi’s through a jeans customization program with their strategic alliance partner Technology Corporation. With this partner they will be able to achieve a competitive advantage. Threat of Suppliers Threat of suppliers all depends on the amount of raw materials. Since Levi’s now has a strategic partner, Technology Corporation they are the ones who take the orders and manufactures the customized jeans at their location. The threat is that they have to rely on another organization to complete the process at a separate location. The benefit though is that this company is a joint venture where each partner has a vested interest in the success of the business thus minimizing risks. However; on the other hand the partner may decide to cheat if they see a more valuable venture for themselves in starting their own line of business. There is also the threat of an increase salary and benefit for employees as well as retention of trained personnel in the area of sales and manufacturing. Threat of Buyers Threat of buyers relies on the marketing of the brand. If Levi’s has a good marketing strategy then customers and suppliers are more likely to purchase their goods. The company has begun to engage in a joint venture with another company therefore once they start receiving orders they will be able to meet the demand to supply stores and retail customers alike. According to the case, the brand Levi is one of the most recognizable brands worldwide since the 1950’s. The jeans had established a political and ashion statement as an American icon. Levi’s has become synonymous with the term â€Å"authentic,† â€Å"genuine,† and â€Å"original. † They are the largest brand-apparel company in the world and the number one purveyor of blue jeans. Levi’s has an image of quality and durability. The image of the company is valuable and rare. Perhaps no other firm has been able to duplicate the Levi brand and the firm uses this image to their competitive advantage as not many firms are able to imitate that image. Despite competetition from low cost rivals who are able to produce more cheaply at overseas facilities, Levi has organized its cost structure and business by using technology and joint venture to their advantage. They have established value creating activities by way of market revitalization and have established a corporate reputation, established links with their suppliers and buyers and invested in high technological equipment and information support systems.

Knight Templar

The Knights Templar is an organization founded in the year 1112 A.D. within the Christian community with a sole aim of protecting the Christians who were visiting   the Holy Jerusalem through Palestine, a land dominated by the Muslims. They were protecting the Christians from the attack of the Muslims. They were so courageous and fierce in battles, and had vowed on obedience,chastity and poverty(Knight Templar Website,2008).Notably, they also engaged themselves in other activities including banking, building,farming,engineering and they were monks(Templar UK Website).They were also known to as the Poor Knights of Christ, which was a kind of a symbolic name. Even though they engaged in other activities like banking, the core activity was in warfare. The activity of banking just arose due to the trust that the crusaders had in the Knights Templar members ,leaving them with valuable items on which they took custody of them at fee. The Templars were considered to the best trained and d isciplines war men of the time and they were directly responsible to the Pope, who was the leader of the Catholic Church. It believed that It is this Knights Templar that laid a foundation for the   development of the modern army systems and operations. On their seal, its was a picture of one horse boarded by two Knights which was symbolic in showing how poor they were.On the start of Knights Templar Organization, its quickly grew becoming politically influential in the international politics, in the sense that it took control of the areas that it hard influence to an extend that is used to collect taxes and initiated tithing in those areas,which accelerated the fast growth into a form of a political institution. The commanding structure of the Knight Templar was like that of the Monastics Order, which was designed by Bernard of Clairvaux, who was the the founder of Cistercian Order. They were above all the authorities,as declared by the Pope but under Pope.The Knights' involvemen t in banking was not intentional, but it rather came due to their reputations in terms of the confidence that the public had on them. The confidence came from their trustworthiness and the respect of their military system, which was mighty and their financial soundness too. Their banking system just started from the point when they stared transporting money and supplies from Europe to Palestine, that later developed into a very efficient banking system which was incomparable to any other banking system that one could have thought of by that time.The Knights were characterized of being generous in defending Jerusalem and other holy lands, which in turn enabled them to gather a lot of wealth from these lands that came in as gifts from their thankful benefactors, from their activities of protecting their lands. They used to get more other wealth from those other orders who joined them,in the form of money and property. These sources of wealth enabled the Knights to have excess money th at it used to invest and lend, in the process of honoring their vow of of poverty, given that they had taken oaths of fighting poverty. Other than these aforementioned sources of wealth, the Pope also used to grant the funds ans in this case,funds of huge sums.The cash which the Templars collected and had in reserve was normally kept in chapter houses and churches(temples), which created avenue for easy access to money for the lender that encouraged even the Spanish who were visiting the Holy land,Jerusalem to lend by the year 1135.The made easy   means of accessing cash by the pilgrims real enable  Ã‚   growth in the banking activities that the Knights involved in, and the banking system itself got favor from it not bringing complications within the order and the Church, which was a show of its political mighty. The Knights chose not to involve the church in the banking system to avoid complications, and specifically it did not involve the church directly in the building of the mortgaged assets.The banking system grew bigger and become more efficient, given that it took care   and understood the needs of the communities in which they were operating in, that made it so influential at the holy land and also in Europe. It is ways of operation and specifically with its banking system, drew the attention of other order from the Europe who were aspiring to solely take control of the money and the   banking sector after the Civil war. Their attention was drawn because the Templars were possessing a lot of holdings in areas covering   Europe and the Middle east and the island of Cyprus(Crystalinks website,2008).The formation of the Knight Templar   followed after the deliverance of Jerusalem (Knight Templar website,2008), when the Crusaders decided to to go back to their home in the process of honoring   their vow, although their was hostility from their Muslims neighbors residing in Palestine. The formation of the Knight Templar was initiated when ther e arose need for protecting the Christian community and they were accepted by Baldwin II in providing the services , after taking a vow of perpetual before the then Patriarch of Jerusalem and later assigned a part of his palace that as bordering with the temple of the city in Jerusalem,that followed the naming of them as the poor Knights of the Temple. They barely started being only nine in number of which they were unable to delver any of their intended services and especially the one for protecting the holy land and the Christian community and they were headed by Huges de Payend.In preparation to kick start their operations their leader,Huges traveled to the west in requesting   the acknowledgment by the church and also to recruit more other members. Knights never had a specified code of rules by then until they came to adapt the Rule of St. Benedict, which was later refined to Cistercians, and they also adapted the three vows of perpetual in addition to the crusaders' vows , th e rules of the church and the   rules of the dormitory. The new recruits were expected to behave in accord   to the set rules within the Knight Templar   composed of four major categories consisted of the farmers,Knights, chaplains and Sergeants. In addition to their rules, the Knight Templars   also adapted the Red cross sign   from the Cistercians Rules.The establishment of Knights Templar was welcomed with a high spirits, to an extend that   even before they had shown their abilities, they received a lot of favor of every kind, where the preceding Popes safe guarded them by exempting them from all kinds of prosecutions, episcopal or secular. All the property owned by the Knights was free from tax and they did this by assimilating their property into church compounds, and they were exempted from paying the ecclesiastical tithes   and having their churches and   cemeteries interdicted. The special treat that was offered to these Knights later brought misunderstandin g among the clergy men of the holy land debating on whether to wipe or not   wipe these favors, although this was never an issue to discuss in Rome as they were guaranteed these favors without question and the favors that they received from the Europe   were worth to make an impact.The Templars had representative in every state, in the name of commanderies, including France which had forty two commanderies and Palestine where grabbed wealth at the disadvantage of the Muslims. For example in the Palestine they had build major possessions like the Safed, Karak and the Castle of Pilgrim that was built in the year 1217 with an aim of defiling the coast of the sea.The character of the Knights was   indefinite ,with respect to the services that they provided. They were fierce in war and very humble in chapels without fear of death on protecting Christianity, and they were the first to attack not giving up easily, while keeping word from their leaders, although they were not very man y by then(Veling Website). On the start of their prosperity, there were only 400 knights in Jerusalem, but composed of noble men who inspired the rest of the Christian community.They normally used to fight to the end without giving up,even if it means held as captives and   when held mostly by the Muslims in forcing them to deny Jesus Christ, on which they died keeping to their faith. Although they were not easily giving up,this situation and experiences scared more recruits   because it required more commitment just more than being recruited in the order,Knight Templar, because all that was expected from a new recruits was total obedience to the rules without compromise. They new recruits were normally put into test in, on testing their sincerity and keeping of secret, although later their was some kind of laxity in observing the rules caused by the great wealth they had acquired and also the greedy for poor.At the amid of its growth,the Knights Templar had 9000 estates   amo ng other wealth holdings that were deposited in the temples at both Paris and London, including the deposits that were under custody received from the princes and individuals just because of their trustworthiness. On this order reaching a kind of an independent state it started extending assistance to the disadvantaged members of the society, that included the minorities and people with various disabilities.During the growth of this order, their happened to be another order by the name Hospitallers that was started in imitating the Knights and which later brought conflict between the two orders due to clashing activities and greed for power. The Hospitallers engaged in military just as the Knights which ignited rivalry between the two orders, but this rivalry was solved by uniting the two order, which was suggested by St. Louis in a council of Lyons in the year 1274, but the union was proposed to start in a new   form by Pope Nicholas II in the year 1293 (Templars UK Website,1996) , on calling for consultations from Christian states.The troubles that led with the collapsing of the Knights Templar started from their denial to compensate the then king of France, Philip IV for his wars(New advent Website). The King had tried so many way in persuading the Knights to pay   including the proceeding Popes from the time of Pope Boniface VIII to Clement V, although Pope Clement V had agreed with King Philip IV but the Knights Declined. In revenge for decline of the Knights Templar,on October 13,1307,King Philip IV of France   arrested the Knights Templar in France and tortured them.The king later held the treasury of the Knights   and disbanded their money banking system, and it was perceived of him being jealousy of the Templars' operations , more especially their wealth and power, which made him envy in controlling them alone. The act of King of France, Philip IV over the Knights sent a deterrence to other orders like the Hospitallers,the Rhodes and the Malta, which convinced them giving up the banking operations in some states like Jerusalem.This was a real break through in the collapse of the Knights Templar as the assets which were outside France were transferred to the ownership of Knights Hospitallers, which was a directive from the Pope and the survivors from the Knights Templar menace were admitted into their former rival Hospitallers. Pope Clement V commanded the dissolving of the Knight Templar. even though so many Kings in various states had not advocated for that, and for instance the king of Spain declined in giving in to the demands of Pope Clement V in transferring all the assets belonging Knights Templar to Hospitallers, although they were later transferred to another order by the Montesa. In Portugal, they only changed the name of the order and rather called it Order of Christ, which was led by Price Henry for 20 years before his death, while the King of Scot had disbanded the order of Knights Templar with different reaso ns.Conclusion. Knight   Templar is an organization that was formed in the the year 1112, with a membership of Nine members, with a sole aim of protecting Christianity and more especially the pilgrims to the holy land from the Europe from their   Muslim neighbors who were trying to deter the spread of Christianity. The nine members headed by Huges,   recruited more new members  Ã‚   and the recruitment was real fast because the order.Knight Templar was highly accepted within the church community, and later after having new recruits they adapted a set of rules which were designed by   Cistercians. Involuntary during their operations in providing military services, they found themselves with a very efficient banking system and this was triggered by their trustworthiness in winning the public confidence, and it started by them being left with precious goods by the crusaders,which later become as big as transmitting money and , building mortgaged property , acting as a custodia n for the stored money and   also the lending of money in fulling their Vow of poverty.It grew bigger,extending to many states   including France,Spain and Scot. The fall of Knight Templar originated from their decline to compensate the then king of France,King Philip IV for the wars that he fought. He revenge by arresting the   Templars and seizing their Assets in France. On adding an injury to a wound, the the Pope, after the arrest of the Templars in France he gave a directive disbanding the Knights Templar organization, ans the transfer of their assets to another order by the name Hospitallers which was a rival order to Knights Templar, on their clash in their respective responsibilities as their operations were like a duplicate.ReferenceLuther J. ,2008 , Knight Templar, Retrieved May 9th,2008 From from the World Wide web;  Ã‚  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   www.crystalinks.com/templars1.htmlDrill M.,2008,Grand Encampment of Knight Templar;Retrieved Ma y 9th,2008 From from the   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   World Wide web; www.knightstemplar.org/purpose1.htmlCharles M.,1912, The Knights Templars;New Advent Website  Ã‚   ,Retrieved May 9th,2008 From   Ã‚  Ã‚  Ã‚  Ã‚   from the World Wide web;  Ã‚  Ã‚  Ã‚   www.newadvent.org/cathen/14493a.htmSimon F.,2008,The Grand priority of Knights Templars in UK and Wales.,Retrieved May   Ã‚  Ã‚   9th,2008   From from the   World Wide web;   www.templars.org.uk/Vatican II,1996, Knights Templar,Retrieved May 9th,2008 From from the World Wide web;  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚     www.veling.nl/anne/templars/

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Social Stratification Essay Example for Free

Social Stratification Essay A. What is Social Stratification? 1. Social stratification is defined as a system by which society ranks categories of people in a hierarchy a. There are four fundamental principles of stratification: †¢ Social stratification is a characteristic of society not just due to individual differences †¢ Social stratification persists over generations †¢ Yet, most societies allow some sort of social mobility or changes in peoples position in a system of social stratification †¢ Social mobility may be upward, downward, or horizontal †¢ Social stratification is universal but variable (it changes) †¢ Social stratification involves both inequality and beliefs 2. Social Stratification is patterned social inequality. It is also the unequal distribution of societal resources. Saying that inequality is patterned indicates that the differences occur: a. on a wide-scale basis b. with regularity   c. and along lines of certain specific, identifiable characteristics (race, class, and gender) 3. Stratification is usually based on three major premises: a. Power: the ability to impose one’s will on others b. Prestige: the respect given by others c. Property: forms of wealth 4. Patterned: if we know whether a person or group possesses or does not possess certain traits, then we will be able to predict with reasonable accuracy how this person or group is likely to fare in the social hierarchy a. Social Hierarchy: A set of ranked statuses 5. Social Inequality: Some types of people systematically experience advantages in society while other types of people are systematically disadvantaged in our society a. Some members of our society are thought of as haves, and others are thought of as have-nots. b. The determination of who is socially advantaged and who is included among the ranks of the socially disadvantaged is based, in part, on certain characteristics these individuals possess and, in part, on how society values or devalues these characteristics 6. Social stratification affects people’s lives and can be manifested in various ways in society. 7. Social Inequality is a structured and systematic phenomenon that affects people in various social classes throughout their lives. a. Because of this patterned inequality, social stratification affects people’s life chances: †¢ Life Chances: Opportunities that individuals do or do no have to engage in certain activities, and the opportunities that they do or do not have to accomplish certain goals simply because of where they are located in the social hierarchy (ex. Smart children born into wealth vs. poor families) B. Caste and Class Systems †¢ People are divided into different groupings and their lives are structured according to these groupings. There are certain things that some people cannot do, simply because their station in life prevents them from being able to do them. †¢ Other people, in a different social stratum, are able to do these things specifically because they occupy a more favorable position in the social hierarchy. †¢ Depending on how much individual mobility is possible; societies may be classified as either a caste system or a class system. 1. A caste system amounts to social stratification based on ascription a. A caste system consists of a fixed arrangement of strata from the most to the least privileged, with a persons position determined unalterably at birth. b. The most extensive contemporary example of a caste system is found in India, especially in rural areas. c. Caste discrimination is officially illegal but exists nonetheless. The traditional castes of India: †¢ Brahmans: mostly priests and scholars. †¢ Kshatriyas: warriors, rulers, and large landholders †¢ Vaishyas: merchants, farmers, and skilled artisans. †¢ Shudras: laborers and unskilled artisans. †¢ Harijans: Sometimes called untouchables, they are ranked so low that, technically, they are outside the caste system itself. d. Caste boundaries in India are reinforced further by the practice of ritual pollution or ritual avoidance. e. A caste system may be determined by many ethnic and cultural factors. European imperial powers in Africa imposed a caste system based on skin color: all whites were in a higher position or caste than any nonwhite f. Caste systems shape peoples lives in four crucial ways: †¢ Caste system largely determines occupation †¢ Caste systems largely mandate endogamy †¢ Powerful cultural beliefs underlie caste systems †¢ Caste systems limit out group social contacts g. Although caste influences remains strong in India, the situation is changing due to communication, transportation, industrialization, and the growth of a middle class. 2. In a class system, social stratification is based on individual achievement a. Class Systems. People who can be considered peers in society because of their similar life chances, similar life circumstances, and similar opportunities, constitute a social class. †¢ In a class system social standing is determined by factors over which people can exert some control, and some mobility does take place. b. In a class system, status inconsistency, the degree of consistency of a persons social standing across various dimensions of social inequality, is lower than in a caste system c. Structural social mobility: a shift in social position of large numbers of people due more to changes in society itself than individual efforts (Ex. Computer Industry) d. Stratification persists because it is backed up by an ideology: cu ltural beliefs that directly or indirectly justify social stratification e. Ideological support for inequality. An ideology or pattern of beliefs justifies social inequality in the Unites States, which legitimizes or justifies a particular societal arrangement. †¢ Ideological Hegemony: Refers to the control over the production of cultural symbols. †¢ One of Karl Marx’s famous quotes is: â€Å"the ruling ideas of any epoch are the ideas of the ruling class because they control the mental means of production. †¢ Thus, the elite has many weapons at their disposal in order to keep society and the lower classes under control. Two of the main ways are the use of force, and the mass media. †¢ Force: use the police, military, National Guard, FBI, etc. †¢ In the long run, it depends on legitimacy in order to maintain stratification. †¢ This is the belief that existing social and political institutions are the best ones for society. †¢ All ruling elite uses their position at the top of society to create an ideology. †¢ This is a complex set of beliefs, values, and norms, which rationalize and support the elites power and privileges. †¢ The dominant or most important and valued ideas in history have been the ideas of the ruling class. †¢ The Government or big corporations do not necessarily control the mass media, but the ruling class does influence what kind of information we get and what kind of ideas we listen to. †¢ Anti-government and Anti-business views are rarely expressed, and Hollywood gives us its share of who are enemies are: both foreign and in this country. †¢ Most of the media gives the same messages of free enterprise, equality of opportunity, individualism, hard work, and consumerism. †¢ This ideology, taught through the mass media, is used by the elite to confuse, distract, and divide the lower classes. †¢ Marx argued that the class in power imposes its ideology on the entire society, and that false consciousness occurs when people in a class accept an ideology that is contrary to the best interest of that class. †¢ Marx argued that false consciousness will exist until the exploited stratum develops a sense of class consciousness, at which time the stratum will become a true social class and begin challenging the ruling class. C. The Functions of Social Stratification 1. The Davis-Moore thesis is the assertion that social stratification is a universal pattern because it has beneficial consequences for the operation of society 2. This thesis implies that societies become more productive as they approach meritocracy: a system of social stratification based on personal merit 3. Criticisms of Davis-Moore: a. It is difficult to specify the functional importance of a given occupation †¢ Some are over/under rewarded (EX. Baseball player, entertainer vs. teacher, garbage collector) b. Davis-Moore ignores how social stratification can prevent the development of individual talents c. The theory also ignore how social inequality may promote conflict and revolution (instability) D. Stratification and Conflict 1. Karl Max: Class and Conflict a. Marx saw classes as defined by peoples relationship to the means of production †¢ Capitalists (bourgeoisie) are people who own factories and other productive business †¢ The proletariat are people who sell their productive labor to the capitalists b. Critical evaluation: †¢ Marxs theory has been enormously influential   Ã¢â‚¬ ¢ His work has been criticized for failing to recognize that a system of unequal rewards may be necessary to motivate people to perform their social roles effectively 2. Three reasons suggested why Western Capitalism has not experienced a Marxist revolution: a. The capitalist class has fragmented and grown in size, giving more people a stake in the system b. The proletariat has also changed †¢ Blue-collar occupations, lower prestige work involving mostly manual labor, have declined †¢ White-collar occupations, higher prestige work involving mostly mental activity, have expanded c. Workers are better organized than they were in Marxs day their unions have been able to fight for reform d. The government has extended various legal protections to workers e. Supporters of Marxist thought have responded: †¢ Wealth remains highly concentrated   Ã¢â‚¬ ¢ White-collar jobs offer no more income, security, satisfaction than blue-collar jobs did a century ago †¢ Class conflict continues between workers and management †¢ The laws still favor the rich 3. Max Weber identified three distinct dimensions of stratification: Class, status, and power a. Max Weber argued that social standing consists (Of three parts or dimensions: class, which he regarded as determined mainly by economic standing or wealth; party, which was equivalent to political power; and status, or social prestige and honor. b. Following Weber, many sociologists use the term socioeconomic status: a composite ranking based on various dimensions of social inequality education, occupation, income †¢ Socioeconomic status. Following Webers lead, contemporary sociologists often use the broader concept of socioeconomic status to refer to a persons ranking along several social dimensions, particularly education, occupational prestige, and income †¢ Education. Education can lead to income attainment, but the benefits are not equally shared by racial and ethnic minorities, or by women. †¢ Wealth consists of consists of the total amount of money and valuable goods that a person or family controls †¢ It is more unequally distributed than income †¢ assets, such as real estate and jewels, and   Ã¢â‚¬ ¢ income consists of occupational wages or salaries and earnings from investments †¢ Occupational Prestige: Occupation serves as a key source of social prestige since we commonly evaluate each other according to what we do †¢ Because there are so many specific occupations, sociologists often categorize occupations into a smaller number: †¢ White-Collar †¢ Professional, manager, and administrator †¢ Technical †¢ Clerical †¢ Blue-Collar †¢ Craft, precision production, and repair †¢ Operative †¢ Labor (excluding farm) †¢ Farm worker †¢ If this scheme is too unwieldy, sociologists often divide occupations into two categories: white-collar and bluecollar. †¢ The pink collar is a category that reflects the segregation of women into certain occupations, such as kindergarten teachers and secretaries. †¢ High incomes usually are associated with high-prestige occupations, but there are exceptions. †¢ Sociologists sometimes use the term prestige to mean the honor associated with an occupation or other position in the social system, and esteem to mean the honor that accrues to the individual filling the position. c. Critical evaluation: Webers views have been widely accepted in the United States although hard economic times may lead to a renewed emphasis on the importance of economic classes E. Inequality in the United States †¢ US society is highly stratified, but many people underestimate the extent of structured inequality in US society †¢ Power is also unequally distributed †¢ Schooling †¢ Ancestry, race, and gender 1. Sociologists usually conceptualize American society as consisting either of three or nine distinct social classes: a. In the three-class model, society is divided into a lower class, a middle class, and an upper class b. In the nine-class model, each of these classes is further divided into three subclasses: lower-lower, middle-lower, lower-middle, middle-middle, etc. 2. Measurement of class. To measure social class standing, sociologists have developed three main methods: a. the objective method ranks individuals into classes on the basis of measures such as education, income, and occupational prestige; b. the reputational method places people into various social classes on the basis of reputation in the community class; and c. Self- identification allows people to place themselves in a social class. c. The lower classes. †¢ The upper-lower class, also called the working class, consists of service personnel, semiskilled operatives, and other blue-collar workers who do not earn enough to accumulate substantial savings. These people are vulnerable to disruptions in their income. †¢ The lower-lower class is made up of people who lack education and live in the most dilapidated sections of the community and in substandard housing. †¢ The lower-lower class may be divided into two subgroups: †¢ The working poor are lower-lower-class people who have jobs but who simply cannot earn an adequate income; and †¢ The chronically poor are mostly unemployed or work only occasionally. 4. Class, race, and gender. These three dimensions often interact to produce a persons place in society, the manner in which people are treated, and their self identify. F. The difference class makes a. Class and health b. Class and values c. Class and politics d. Class, family, and gender G. The Myth and the Reality of Mobility in the United States †¢ Amount of mobility. Sociologists frequently focus on the intergenerational mobility of individuals: upward and downward movements in socioeconomic status measured between the standing of children compared to that of their parents. 1. Myth versus reality a. Four general conclusions †¢ Social mobility, at least among men, has been high †¢ The long-term trend in social mobility has been upward †¢ Within a single generation, social mobility is usually incremental, Not dramatic †¢ The short-term trend has been stagnation, with some income polarization b. Mobility varies by income level c. Mobility also varies by race, ethnicity, and gender 1. Determinants of mobility †¢ Social Mobility: The movement of persons and groups within the stratification system. a. Steepness of the socioeconomic pyramid: that there are not enough high status jobs to satisfy everyone. b. Starting position on the socioeconomic ladder: some people begin closer to the top than others. c. Structural mobility: the movement of entire categories of people due to changes in society itself. d. Types of mobility †¢ Upward and downward †¢ Intragenerational social mobility is a change in social position occurring during a persons lifetime †¢ Intergenerational social mobility is upward or downward social mobility of children in relation to their parents 2. Social stratification can be determined by a number of variables, each of which can cause someone to be advantaged or disadvantaged compared to others in society. a. It is not necessarily the impact of any one variable in U.S. society that leads to stratification – it is a unique combination of stratification-related factors that determines how one succeeds in society. b. Some of these traits are within our control, others we have little control over (ascribed vs. achieved) Who can tell me which is which? †¢ Major ascribed social stratifiers: race, sex, and age †¢ Major achieved social stratifiers (education, income, occupation, religion, etc.) SOCIAL stratification is the main reason for relational set of inequalities in economic, social, political and ideological dimensions. It is a system whereby people rank and evaluate each other. On the basis of such evaluation, one is rewarded with more wealth, authority, power and prestige. It is broadly organised into three parts: upper class, middle class and lower class on the basis of power and wealth. This has resulted in the creation of a number of levels within our society. Social stratification causes social disparity and many problems as it is an unjust system with monopoly of power and wealth in a particular group. It affects life chances, lifestyles and prestige. It creates emotional stress and depression for the people belonging to lower social stratum as they have unequal access to wealth, power and prestige. It creates a huge gulf between the people in terms of their incomes and a range of measures associated with social position, education, health, and psychological well-being. It is distinctly perceived that disparity causes chaos in society. These are the stumbling blocks in the way to progress and development of the country.

The Pringles history

The Pringles history Pringles history Pringles were invented and first sold in 1968 in October in USA, but they were not sold across America till mid 1970s. According to the patent, the inventor of Pringles brand potato chips was reputed Alexander Liepa from Montgomery, Ohio. It is produced by the company Procter Gamble. At the beginning the potato chips had the name of Pringles Newfangled Potato Chips, but due to the entering national market it was changed. Now the global brands of Pringles are available in more than 100 different countries all over the world and they come in 45 flavours. Currently the potato chip or crisps snack is produced in North America in Jackson, Tennessee and also in Europe in Mechelen, Belgium. The name of Pringles was chosen from a Cincinnati telephone book. Pringle Avenue in Finneytown was available for trademark, and its pleasant sound appealed to the brand (brand.http://www.uk.pg.com/products/products/pringles.html). Marketing side Pringles is the biggest brand of Proctor Gamble earning over $1bn year in revenues. It is advertised in the United States, the United Kingdom, Australia and the Republic of Ireland with the slogan Once you pop, you cant stop and elsewhere with the slogan Everything pops with Pringles. (http://en.wikipedia.org/wiki/Pringles). The potato chips of Pringles are famous of their different and unusual packaging. It is a tubular can with a foil interior, and a resealable plastic lid; it also has a famous logo, a stylized representation of a man with a large moustache and parted bangs. (http://www.spiritus-temporis.com/pringles/). All Pringles potato chips are made in the same size and packed in a can carefully, one on each not to be crushed like the chips in a bags. The way of this packaging was invented by Fredric J. Baur, who at that time worked for the Procter Gamble company in a research, development and quality control department as an organic chemist and food storage technician. Different ways of using Pringles box Because of the cardboard tube packaging, the crisp box can be used like a great Wi-Fi antenna. In some cases it is also used as a storage box for small stuff or even for the clothes. For instance, the comedian Dilbert rolls his cloths in a Pringles box that later he could change at work or in the car. Sport people can find it useful too, because the can is just the size of three tennis balls. Pringles cans are always colorful, interesting and different, so there are quite a lot of people just simply collecting them. Flavours Pringles are also unique of their wide ranger of flavour and according to the countries needs and traditions, different flavours in different countries, limited market areas: United States Original Sour Cream Onion Jalapeà ±o Prints White Cheddar Chili Cheese Pizza-licious Cheezums Ranch Spicy Cajun Fiery Hot Barbecue Salt Vinegar Reduced Fat Original Reduced Fat Sour Cream Onion Fat Free Original Fat Free Sour Cream Onion Current permanent European flavors (from the UK website): Original Paprika Sour Cream Onion Salt Vinegar Cheese Onion Hot Spicy Texas Barbecue Sauce Cheese Tomato Mozzarella Light Original Light Sour Cream Onion Current Japan flavors (from the Japan website): Lightly Salted Flavor Sour Cream Onion French Consommà © (new) Partial list of discontinued limited edition flavors : Cheddar and Sour Cream Chili Cheese Crunchy Dill (2005 flavor) Crushed Pepper Jalapeno Hickory BBQ Salt Pepper Smokey BBQ Southwestern Salsa Thai Sweet Chilli Wisconsin White Cheddar (http://www.spiritus-temporis.com/pringles/) Moreover, there are few other varieties of this product such as Pringles Select, Pringles Light Aromas, Pringles Rice infusions and Fat Free Pringles. There are several sizes of cans of 23g, 50g, 80g, 100g, 145g, 150g, 155g, 160g, 163g, 181g and 230g. Interesting facts Pringles are a marketing case study in packaging innovation. In 1982 in a Pringles commercial appeared one of the famous persons in the world Brad Pitt. Pringles cans inventor Fredric J. Baur was so proud of his creation that he requested his children to buried him in it. Baur passed on March 4, 2008 and his family put some of the ashes in a Pringles can, and the rest in a traditional urn. In the eyes of the High Court in London Pringles snacks were adjudge to be not potato crips. As the consequence the company doesnt need to pay a value-added tax, what influence the price increase too. In 2007 Proctor Gamble start selling Pringles Minis. It was unusual for the Pringles fans, because new chips were packed in a small bag instead of tubular can. The shape of the chips was exactly the same, just smaller in size.

The History of Rap Music :: Rap Music Jamaican Culture Essays

The History of Rap Music Rap music originated as a cross-cultural product. Most of its important early practitioners-including Kool Herc, D.J. Hollywood, and Afrika Bambaataa-were either first- or second-generation Americans of Caribbean ancestry. Herc and Hollywood are both credited with introducing the Jamaican style of cutting and mixing into the musical culture of the South Bronx. By most accounts Herc was the first DJ to buy two copies of the same record for just a 15-second break (rhythmic instrumental segment) in the middle. By mixing back and forth between the two copies he was able to double, triple, or indefinitely extend the break. In so doing, Herc effectively deconstructed and reconstructed so-called found sound, using the turntable as a musical instrument. While he was cutting with two turntables, Herc would also perform with the microphone in Jamaican toasting style-joking, boasting, and using myriad in-group references. Herc's musical parties eventually gained notoriety and were often documented on cassette tapes that were recorded with the relatively new boombox, or blaster, technology. Taped duplicates of these parties rapidly made their way through the Bronx, Brooklyn, and uptown Manhattan, spawning a number of similar DJ acts. Among the new breed of DJs was Afrika Bambaataa, the first important Black Muslim in rap. (The Muslim presence would become very influential in the late 1980s.) Bambaataa often engaged in sound-system battles with Herc, similar to the so-called cutting contests in jazz a generation earlier. The sound system competitions were held at city parks, where hot-wired street lamps supplied electricity, or at local clubs. Bambaataa sometimes mixed sounds from rock-music recordings and television shows into the standard funk and disco fare that Herc and most of his followers relied upon. By using rock records, Bambaataa extended rap beyond the immediate reference points of contemporary black youth culture. By the 1990s any sound source was considered fair game and rap artists borrowed sounds from such disparate sources as Israeli folk music, bebop jazz records, and television news broadcasts. In 1976 Grandmaster Flash introduced the technique In 1979 the first two rap records appeared: "King Tim III (Personality Jock)," recorded by the Fatback Band, and "Rapper's Delight," by Sugarhill Gang. A series of verses recited by the three members of Sugarhill Gang, "Rapper's Delight" became a national hit, reaching number 36 on the Billboard magazine popular music charts. The spoken content, mostly braggadocio spiced with fantasy, was derived largely from a pool of material used by most of the earlier rappers. The backing track for "Rapper's Delight" was supplied by hired studio musicians, who replicated

Gun Control Control Laws Decrease Crime Essay -- Second Amendment The R

Gun Control Since the days of the pioneers of the United States, firearms have been part of the American tradition as protection and a means of hunting or sport. As we near the end of the 20th century the use of guns has changed significantly. Because of fast and steady increase in crime and the fight for the right to own a hand gun, the introduction of legislation for gun control, to try to reduce the crime in the United States, has been a hotly debated issue in recent years. Although many people feel that gun control violates the right of the people, given in the second amendment "the right to bear arms", controlling distribution and sales and the registration of guns and gun owners is necessary because of the homicide rate involving guns and the violence by criminals using guns. Many people feel that gun control violates the right of the people given in the second amendment the right "to bear arms". Opponents of gun control, including the National Rifle Association, better known as the NRA, argue that the "right To bear arms" is guaranteed in the second amendment of the Constitution of the United States of America and licensing restrictions penalize law-abiding citizens while in no way preventing criminal use of handguns. It is also argued that by making it difficult for guns to be bought and registered for the American public there is a threat to the personal safety of American families everywhere. However controlling the sale and distributi...

The Death Of A Salesman: The Reality Evasion Drug :: essays research papers

Never does one go through their life without having to deal with some sort of personal conflict. The manner in which people deal with these conflicts vary as much as the prints on a person's finger. Some try and solve the problem and get rid of it, while others will try and put it aside for as long as possible. Willy Loman's method in Arthur Miller's play, The Death of a Salesman, is very dangerous and builds to harsh results. Willy never tries to help the circumstances, he only flees to his great memories of the better days, when his life's predicaments were very limited. He uses this evasion tool as though it were an addictive narcotic, and as the story unfolds, the audience soon discovers the lethality of the drug. Willy's first flash to the past was when his son, Biff, returns home from the west. Willy discusses his disappointment in Biff with his dear wife Linda. When Willy fails to cope with this misfortune successfully, he returns in his head to a time when everything was going well and life was more fortunate to him. It is perfectly normal for one to remember more fortunate days at the more dispirited times of life, as long as they can return to the present and deal with the reality of the situation. However, Willy never does return to the original problem, he just continues on with life, fleeing from the troubles that cross his path. His refusal to acknowledge reality becomes so significant, that he honestly believes the past, and he lives his entire life through a false identity never looking at the truth of his life. Willy becomes more and more dependent on his drug as the story progresses. His next allusion to the past was during a conversation with his wife. Willy is downhearted about his failure to provide for his family, his looks, and basically his whole life in general. He begins to see some of the truth in his life: "I know it when they walk in. They seem to laugh at me."(Miller; The Death of a Salesman; pg. 23) By trying to see the reality in life, for once, he depresses himself so awfully, that he has a rendezvous in his head with his women that he sees on the side. He only uses this women to lift his spirits and to evade the truths that nearly scare him into his own grave.

The Underwriting Challenges Facing P.S.V. Insurers in Kenya

Rational Choice Theory: An Overview by Steven L. Green Professor of Economics and Statistics Chair, Department of Economics Baylor University Prepared for the Baylor University Faculty Development Seminar on Rational Choice Theory May 2002  © 2002, Steven L. Green It has been said that democracy is the worst form of government except all the others that have been tried. -Winston ChurchillIt seems easy to accept that rationality involves many features that cannot be summarized in terms of some straightforward formula, such as binary consistency. But this recognition does not immediately lead to alternative characterizations that might be regarded as satisfactory, even though the inadequacies of the traditional assumptions of rational behaviour standardly used in economic theory have become hard to deny. It will not be an easy task to find replacements for the standard assumptions of rational behaviour †¦ hat can be found in the traditional economic literature, both because the identified deficiencies have been seen as calling for rather divergent remedies, and also because there is little hope of finding an alternative assumption structure that will be as simple and usable as the traditional assumptions of self-interest maximization, or of consistency of choice. – Amartya Sen (1990, p. 206) 1. Introduction Rational Choice Theory is an approach used by social scientists to understand human behavior.The approach has long been the dominant paradigm in economics, but in recent decades it has become more widely used in other disciplines such as Sociology, Political Science, and Anthropology. This spread of the rational choice approach beyond conventional economic issues is discussed by Becker (1976), Radnitzky and Bernholz (1987), Hogarth and Reder (1987), Swedberg (1990), and Green and Shapiro (1996). The main purpose of this paper is to provide an overview of rational choice theory for the non-specialist.I first outline the basic assumptions of the ra tional choice approach, then I provide several examples of its use. I have chosen my examples to illustrate how widely the rational choice method has been applied. In the paper I also discuss some ideas as to why the rational choice approach has become more prevalent in many disciplines in recent years. One idea is that the rational choice approach tends to provide opportunities for the novel confirmation of theories. I argue that these opportunities are the result primarily of the mathematical nature of the approach.I then consider several issues raised by rational choice theory. First, I compare the limited meaning of â€Å"rationality† in rational choice theory with the more general definitions of the term use by philosophers. Second, I describe some of the main criticisms that have been levied against the rational choice approach. Third, I consider the limitations of rational choice models as guides to public policy. Fourth, I review some Christian perspectives on the rat ional choice appraoch.I end the paper by outlining three sets of questions I would like us to discuss in the faculty development seminar. Before I proceed, an apology and a caveat are in order. I apologize for the length of this paper. The British publisher Lord Beaverbrook once apologized to a friend for sending a five- page letter, saying he did not have time to write a one-page letter. I have the same sentiment here. The caveat is that my discussion of the rational choice theory in this paper is necessarily simplistic, so the reader should not take it as definitive.If some element of the theory seems suspect in some way, there will nearly always be an advanced version of the theory published somewhere that is more subtle and nuanced. Most statements in this paper are subject to qualification along many lines, so the reader should view what I present here keeping in mind the goal of the paper, which is only to give the reader some sense of the overall flavor of the rational choice approach. 2. Basic Assumptions about Choice DeterminationRational Choice Theory generally begins with consideration of the choice behavior of one or more individual decision-making units – which in basic economics are most often consumers and/or firms. The rational choice theorist often presumes that the individual decision-making unit in question is â€Å"typical† or â€Å"representative† of some larger group such as buyers or sellers in a particular market. Once individual behavior is established, the analysis generally moves on to examine how individual choices interact to produce outcomes.A rational choice analysis of the market for fresh tomatoes, for example, would generally involve a description of (i) the desired purchases of tomatoes by buyers, (ii) the desired production and sales of tomatoes by sellers, and (iii) how these desired purchases and desired sales interact to determine the price and quantity sold of tomatoes in the market. The typical toma to buyer is faced with the problem of how much of his income (or more narrowly, his food budget) to spend on tomatoes as opposed to some other good or service.The typical tomato seller is faced with the problem of how many tomatoes to produce and what price to charge for them. Exactly how does the buyer choose how much of his income to spend on tomatoes? Exactly how does the seller choose how many tomatoes to produce and what price to charge? One could imagine a number of answers to these questions. They might choose based on custom or habit, with current decisions simply a continuation of what has been done (for whatever reason) in the past. The decisions might be made randomly.In contrast, the rational choice approach to this problem is based on the fundamental premise that the choices made by buyers and sellers are the choices that best help them achieve their objectives, given all relevant factors that are beyond their control. The basic idea behind rational choice theory is tha t people do their best under prevailing circumstances. What is meant, exactly, by â€Å"best achieve their objectives† and â€Å"do their best? † The discussion in this section will emphasize the choices of consumers. 1] The rational choice theory of consumer behavior is based on the following axioms regarding consumer preferences:[2] 1) The consumer faces a known set of alternative choices. 2) For any pair of alternatives (A and B, say), the consumer either prefers A to B, prefers B to A, or is indifferent between A and B. This is the axiom of completeness. 3) These preferences are transitive. That is, if a consumer prefers A to B and B to C, then she necessarily prefers A to C. If she is indifferent between A and B, and indifferent between B and C, then she is necessarily indifferent between A and C. ) The consumer will choose the most preferred alternative. [3] If the consumer is indifferent between two or more alternatives that are preferred to all others, he or sh e will choose one of those alternatives — with the specific choice from among them remaining indeterminate. When economists speak of â€Å"rational† behavior, they usually mean only behavior that is in accord with the above axioms. I consider the definition of â€Å"rationality† in more detail near the end of the paper below. Rational choice theories usually represent preferences with a utility function.This is a mathematical function that assigns a numerical value to each possible alternative facing the decision maker. As a simple example, suppose a consumer purchases two goods. Let x denote the number of units of good 1 consumed and y denote the number of units of good 2 consumed. The consumer’s utility function is given by U = U(x,y), where the function U( ·, ·) assigns a number (â€Å"utility†) to any given set of values for x and y. [4] The properties of a large number of specific function forms for U( ·, ·) have been considered. 5] Th e analysis is by no means restricted to two goods, though in many cases the analyst finds it convenient to assume that x is the good of interest is and y is a â€Å"composite good† representing consumption of everything but good x. The function U( ·, ·) is normally assumed to have certain properties. First, it is generally assumed that more is preferred to less – so that U rises with increases in x and with increases in y. Another way of saying this is to say that marginal utility is positive – where the term â€Å"marginal utility† is the change in utility associated with a small increase in the quantity of a good consumed.The second property of U( ·, ·) is that of diminishing marginal utility, which means that the (positive) marginal utility of each good gets smaller and smaller the more of the good that is being consumed in the first place. One’s first Dr. Pepper after a workout yields quite a lot of satisfaction. By the fifth or sixth, the additional satisfaction, while still positive, is much smaller. An important result in consumer theory is that a preference relationship can be represented by a utility function only if the relationship satisfies completeness and transitivity.The converse (that any complete and transitive preference relation may be represented by a utility function) is also true provided that the number of alternative choices is finite. [Mas-Collel, Whinston, and Green (1995, p. 9)] If the number of possible alternative choices is infinite, it may not be possible to represent the preference relation with a utility function. Rational choice analysis generally begins with the premise that some agent, or group of agents, is [are] maximizing utility – that is, choosing the preferred alternative. This is only part of the story, however.Another important element of the choice process is the presence of constraints. The presence of constraints makes choice necessary, and one virtue of rational c hoice theory is that it makes the trade-offs between alternative choices very explicit. A typical constraint in a simple one-period consumer choice problem is the budget constraint, which says that the consumer cannot spend more than her income. Multi-period models allow for borrowing, but in that case the constraint is that the consumer must be able to repay the loan in the future.The use of utility functions means the idea of agents making the preferred choices from among available alternatives is translated into a mathematical exercise in constrained optimization. That is, an agent is assumed to make the feasible choice (feasible in a sense that it is not prohibited by constraints) that results in the highest possible value of his or her utility function. Constrained optimization methods (based on either calculus or set theory) are well developed in mathematics. The solution to the constrained optimization problem generally leads to a decision rule.The decision rule shows how uti lity-maximizing choices vary with changes in circumstances such as changes in income or in the prices of goods. A third element of rational choice analysis involves assumptions about the environment in which choices are made. Simple economic models are often restricted to choices made in markets, with emphasis on how much of each good or service consumers want to purchase (or firms want to produce and sell) under any given set of circumstances. A fourth element of rational choice analysis is a discussion of how the choices of different agents are made consistent with one another.A situation with consistent choices in which each agent is optimizing subject to constraints is called equilibrium. In the fresh tomato market, for example, the choices of buyers and sellers are consistent if the quantity of tomatoes consumers want to purchase at the prevailing price is equal to the quantity that firms want to produce and sell at that price. In this as in other simple market models, price pl ays a key role in the establishment of equilibrium. If consumers want to purchase more than firms are producing, the price will be bid upward, which will induce more production by firms and reduce desired purchases by consumers.If consumers want to purchase less than firms are producing, the resulting glut will force prices down, which will reduce production by firms and increase purchases by consumers. Fifth and last, in the absence of strong reasons to do otherwise such as the imposition of price controls by the government, the analyst employing rational choice theory will generally assume that equilibrium outcomes in the model are adequate representations of what actually happens in the real world.This means, in the above example, that a rational choice theorist would explain changes in the actual price of tomatoes observed in the real world by looking for possible causes of changes in the equilibrium price of tomatoes in her model. Extensions The basic rational choice theory des cribed above has been extended in a number of ways. I will consider four important ones in this section, though there are of course many others. First, the basic theory accounts only for choice at a given time – that is, the model is static.In contrast, a dynamic (or intertemporal) model allows the agent to plan for the future as well as make choices in the present. In a dynamic model, the agent is still assumed to maximize utility, but the concept of utility is generalized to include not only present satisfaction but also future satisfaction. The agent does not just make choices today – he makes a plan for current and future choices. In this case, it may well be â€Å"rational† to sacrifice (e. g. , consume less or work more) today in order to obtain some better outcome tomorrow. The dynamic formulation is an essential element of theories of saving and investment.One issue that arises in dynamic models is that of discounting. In most dynamic models, the agents under consideration are assumed to prefer (other things equal) a given level of consumption in the present to a given level of consumption in the future. Consider a model with two periods, 1 and 2. Let U1 denote the agent’s utility in period 1 and U2 denote utility in period 2. (U1 and U2 can depend on a number of factors, some of which can be controlled by the agent. ) The agent would then be assumed to formulate a plan for periods 1 and 2 to maximize the sum V = U1 + ?  ·U2, where 0 < ? < 1 is the â€Å"discount factor. [6] A specification of ? < 1 means that a given utility is worth less to the agent in the future than in the present, and is denoted a â€Å"positive rate of time preference† or simply â€Å"time preference. † A justification for time preference is given by Olson and Bailey (1981). Elster (1984, pp. 66ff) summarizes the opposing view that â€Å"†¦ for an individual the very fact of having time preferences, over and above what is justif ied by the fact that we are mortal, is irrational and perhaps immoral as well. † In any case, dynamic models with positive time preference are pervasive in the rational choice literature.The basic rational choice model assumes all outcomes are known with certainty. A second extension of the basic model involves explicit treatment of uncertainty. This is important in rational choice models of crime, for example, where a rational agent is assumed to consider the chance he or she will be apprehended while committing a criminal act. The rational choice model is extended to allow for uncertainty by assuming the agent maximizes expected utility. Uncertainty is characterized by a probability distribution that assigns a likelihood (probability) to each possible outcome.Suppose there are two possible outcomes (for example, the prospective criminal is apprehended while committing a crime, or not apprehended while committing the crime), which we can denote outcome A and outcome B. Let pA denote the probability that outcome A will occur pB denote the probability of outcome B. With these as the only possible outcomes, it is clear that pA + pB = 1 — that is, there is a 100% chance that either A or B will occur. Let U(A) be the agent’s utility with outcome A and U(B) be the agent’s utility with outcome B.The agent is then assumed to maximize expected utility, which is the sum of utility in each outcome weighted by the probability that outcome will occur: V = pA ·U(A) + pB ·U(B). In general, the choices of the agent can affect pA and pB as well as U(A) and U(B). A related (and third) area in which the rational choice model is extended involves incomplete information. In the basic model described above, the agent knows perfectly all the qualities of the goods under her consideration. More generally, an agent may have to make choices when she does not have full information.A university generally does not have full information about the future rese arch productivity of a new assistant professor, for example, and a used car buyer cannot be certain that he is not driving a â€Å"lemon† off the lot. The fourth area in which the basic rational choice model is extended involves strategic behavior. This generally occurs in situations in which there are only a few agents. The key issue is that each agent must take into account the likely effect of his actions on the decisions of other agents, all of whom are looking at the situation the same way.A classic ongoing example of this kind of interaction involves the crude-oil production decisions of the Organization of Petroleum Exporting Countries (OPEC). Acting collectively, OPEC members have an incentive to restrict production to keep the world price of crude-oil high. Thus each OPEC country is given a production quota – a limit on the amount it can produce. Each country acting individually, however, has an incentive to â€Å"cheat† on its quota and thereby be able to sell more crude-oil at the high price. This will only be successful if the other countries maintain their quotas, however, thereby keeping the price high.Thus when a country is contemplating the breach of a quota, it must consider how other member countries may react. The branch of economics that deals with strategic interactions is called game theory. [7] 3. A Brief Description of the Rational Choice Method Like most scholarship, rational choice analysis usually begins with a question. What determines church attendance? Are suicide rates affected by the state of the economy? Do seat belt laws make highways safer? Under what circumstances are â€Å"cold turkey† methods necessary to end addictions?Why are drivers of certain minority groups more likely to be pulled over by police? Which soldiers are most likely to suffer casualties in a war? Why can’t Yasser Arafat and Ariel Sharon just get along? Why did large mammals become extinct in the Pelistocene era? When are workers most likely to â€Å"shirk† their job responsibilities? Does a reported decline in â€Å"consumer confidence† portend a slowdown in the economy? Varian (1997, p. 4) describes the model-building process as follows: †¦ all economic models are pretty much the same. There are some economic agents. They make choices in order to advance their objectives.The choices have to satisfy various constraints so there’s something that adjusts to make all these choices consistent. This basic structure suggests a plan of attack: Who are the people making choices? What are the constraints they face? How do they interact? What adjusts if the choices aren’t mutually consistent? I will provide a slightly more detailed description here. Rational choice analysis may be characterized as working through the following steps: 1) Identify the relevant agents and make assumptions about their objectives. 2) Identify the constraints faced by each agent. ) Determine the â⠂¬Å"decision rules† of each agent, which characterize how an agent’s choices respond to changes of one kind or another – for example, how the quantity of tomatoes purchased might change with price or income. This task is usually accomplished mathematically by the solution of a constrained optimization problem. 4) Determine how the decision rules of various agents may be made consistent with one another and thereby characterize the equilibrium of the model. [8] Effective analysis of complex interactions between agents normally involves the use of mathematical methods, which can sometimes be quite sophisticated. ) Explore how the equilibrium of the model changes in response to various external events. That is, determine the predictions or implications of the model. Again, this step can involve substantial use of mathematics. 6) Examine whether the predictions determined in step (5) are consistent with actual experience. This step often involves the statistical anal ysis of data and can involve sophisticated techniques (to control sample selection bias, for example). 7) Draw conclusions and any implications (for government policy, for example) implied by (6).It is often the case that the question at hand may be addressed by reference to standard theoretical results (e. g. , people generally want to consume less of a product when its price increases). In these circumstances the analyst often will not specify and solve a rational choice model explicitly. Instead, she will assume the reader understands that the model could be specified and solved if necessary and would have conventional implications. A. Preference Specification In rational choice theory behavior follows from the pursuit of objectives, so preference specification is crucial.Frank (1997, p. 18) describes two general approaches. The self-interest standard of rationality â€Å"says rational people consider only costs and benefits that accrue directly to themselves. † The presen t-aim standard of rationality â€Å"says rational people act efficiently in pursuit of whatever objectives they hold at the moment of choice. † Frank contends that neither approach is obviously satisfactory. Many people would seem to care about more than their own material well-being, so the selfish egoism implied by self-interest standard is probably too narrow.In contrast, the present-aim standard puts no restrictions at all on preference formation, which means that anything can be explained by an appeal to preferences. Again quoting Frank (1997, p. 18): Suppose, for example, that we see someone drink a gallon of used crankcase oil and keel over dead. The present-aim approach can â€Å"explain† this behavior by saying that the person must have really liked crankcase oil. The main strength of the self-interest standard is that the associated preference specifications are generally straightforward.This approach, which dominates basic economic theory, usually assumes th at utility depends only on the consumption of material goods and services and that, for any given good or service, more is strictly preferred to less. Bergstrom (forthcoming) presents an analysis based on evolutionary considerations showing circumstances under which selfish behavior will become dominant. The present-aim standard has also been used in rational choice models, but its use is nowhere near as prevalent as use of the self-interest standard. The reasons are threefold.First, the self-interest standard has often been successful in the sense of yielding predictions that are consistent with experience. Second, there is no compelling way to specify preferences when the only criterion is â€Å"more than self-interest matters. † (People may care about others, but are teh jealous or altruistic? ) Third, self-interest standard models are more tractable analytically and are more prone than present-aim models to imply specific observable predictions. In particular, models in w hich agents care about each other in some way are prone to have multiple equilibria (sometimes an infinity of equilibria).Frank (1987) makes an evolutionary argument that preferences should include concerns for others. Bergstrom (1999) explores some possible solutions to the â€Å"multiple equilibrium† problem. B. Theory Revision It many instances step (6) will find that one or more of the predictions of a model are not borne out by the data. In these cases, the typical rational choice theorist will not even consider abandoning the assumption of utility maximization. Instead, she will conclude that she must have missed something about constraints or preferences and attempt to revise her theory accordingly.This issue of theory revision is very tricky, and space limitations (not to mention by limited understanding) permit only a brief discussion here. Suppose a theory T has prediction P, when in fact available data indicate the opposite (not P, or ~P). The theory might then be revised in some way to become theory T’, where T’ predicts ~P rather than P. My impression is that most economists would much rather change assumptions about constraints rather than change assumptions about preferences. 9] This viewpoint reflects a desire to avoid meaningless tautologies such as â€Å"he consumed more tomatoes because his preferences changed in such a way that he wanted to consume more tomatoes. † One can explain any choice in this way. Hausman (1984) summarizes the thinking of Lakatos (1970) as follows: A modification of a theory is an improvement if it is not ad hoc. Modifications may be ad hoc in three ways. First of all, a modification of a theory may have no new testable implications at all. Lakatos regards such modifications as completely empty and unscientific.Modifications that are not ad hoc in this sense are â€Å"theoretically progressive. † It may be, however, that the testable implications of the theoretically progressive mod ifications are not confirmed by experiments or observations. In that case modifications are theoretically progressive but not empirically progressive. They are ad hoc in the second sense. An extended process of theory modification is progressive overall if the modifications are uniformly theoretically progressive and intermittently empirically progressive.As one is modifying one’s theory in the hope of improving it, modifications must always have new testable implications, and those testable implications must sometimes be borne out by experience. But one crucial feature of science has been left out. Throughout this history of repeated modifications, there must be some element of continuity. No theoretical progress in economics is made if I modify monetary by theory by adding to it the claim that copper conducts electricity. The expanded theory has testable (and confirmed) implications, but something arbitrary has simply been tacked on.Such a modification is ad hoc in the thir d sense. One needs to recognize the role of something like a Kuhnian â€Å"paradigm. † Modifications of theories must be made in the â€Å"right† way. (p. 23) I believe that most rational choice theorists would adhere to these criteria for effective theory modification. As Stigler and Becker (1977) note: What we assert is not that we are clever enough to make illuminating applications of utility-maximizing theory to all important phenomena – not even our entire generation of economists is clever enough to do that.Rather, we assert that this traditional approach of the economist offers guidance in tackling these problems – and that no other approach of remotely comparable generality and power is available. (pp. 76-7) †¦. We also claim †¦ that no significant behavior has been illuminated by assumptions of differences in tastes. Instead, they, along with assumptions of unstable tastes, have been a convenient crutch to lean on when the analysis has bogged down. They give the appearance of considered judgement (sic), yet really have only been ad hoc arguments that disguise analytical failures. p. 89) In any case, one can change assumptions about preferences only if the new assumptions not only fix the failure of the previous model (that is, they imply ~P rather than P) but also have new predictions that are not rejected by the data. C. Why is the Rational Choice Approach so Popular? [10] Defenders of the rational choice approach – e. g. , Becker (1976) — argue that the approach is useful because it tends to generate non-tautological predictions. Suppose a scholar wants to account for some observed phenomenon P.For example, P might be the fact that wage rates paid to workers (after adjustment for inflation) tend to rise during good economic times [expansions] and fall during bad economic times [recessions]. It is generally quite easy to develop a theory T that predicts P, especially for someone who has studied P ca refully. In fact, many such theories can be constructed. Importantly, however, it is generally not good scientific practice to use the same data to both formulate and test a hypothesis or theory. If so, all theories would be confirmed.Instead, good methodology will develop a theory T that not only predicts P, but that also has other predictions Q1, Q2, Q3, †¦ Ideally, many of these predictions will be observable – that is, one should be able to determine if Q1, Q2, Q3 †¦. do or do not in fact occur. If these predictions are not observed – say not Q1 (~Q1) is observed rather than Q1 – the theory may be judged inadequate and either revised or discarded. If I may be allowed a lapse into imprecise language, a theory can never be right if there is not at least some possibility in the first place for it to be wrong. 11] This is not to say that rational choice theorists are pristine with respect to this requirement. The history of economic thought is no doubt full of bad theories (â€Å"bad† in the sense that one or more key predictions are not consistent with the data) that have been saved by ad hoc modifications. It is to say that proponents of the rational choice approach contend that ad hoc theorizing and the resulting empty tautologies may be less prevalent with their approach than with other approaches.I certainly agree that the rational choice method does in fact tend to generate many testable predictions, and in Sections 4 and 5 below I discuss several illustrative examples. Despite the fact that advocates of rational choice theory justify their approach in this way, I know of no study that explicitly compares methodologies along these lines. Is it really the case that rational choice models have more non-tautological implications than the models implied by other approaches? I am not sure anyone has examined this issue carefully.I believe the rational choice methodology is gaining in popularity not just because it tends t o generate lots of observable predictions, but also because it tends to generate novel predictions. This is an extension of the idea of novel confirmation. Novel confirmation embodies the sentiment expressed by Descartes (1644) that we know hypotheses are correct â€Å"only when we see that we can explain in terms of them, not merely the effects we originally had in mind, but also all other phenomena which we did not previously think. † [Quoted by Musgrave (1974), p. 1)] Campbell and Vinci (1983, p. 15) begin their discussion of novel confirmation as follows: Philosophers of science generally agree that when observational equivalence supports a theory, the confirmation is much stronger when the evidence is ‘novel’. The verification of an unusual prediction, for example, tends to provide much stronger confirmation than the explanation of something already known of something the theory was designed to account for. This view is so familiar that Michael Gardner has r ecently described it as ‘a lengthy tradition – not to say a consensus – in the philosophy of science. ’As seems to often be the case in the philosophy of science, the usefulness of novel confirmation is not as well established as the above quote implies. Campbell and Vinci (1983) also note that â€Å"†¦ the notion of novel confirmation is beset with a theoretical puzzle about how the degree of confirmation can change without any change in the evidence, hypothesis, or auxiliary assumptions. † (p. 315) Kahn, Landsburg, and Stockman (1992) maintain that the question of novel confirmation can be addressed meaningfully only in the presence â€Å"of an explicit model by which hypotheses are generated. † (p. 04) They find that the idea of novel confirmation is valid if there are unobservable differences in the abilities of scientists or if there is some chance of error in observation. [12] Campbell and Vinci (1993) distinguish between epistemic novelty and heuristic novelty. Epistemic novelty occurs when a theory has an implication that would be considered highly improbable in the absence of the theory. There is of course a question over the proper definition of â€Å"highly improbable. † Heuristic novelty occurs when the evidence predicted by a theory plays no heuristic role in the formation of the theory.Descartes would seem to be referring to heuristic novelty in the above quote. Rational choice theory is a useful methodology in part (perhaps in large part) because it tends to lead the researcher to novel implications, thereby making novel confirmation more likely than may be the case with other methodologies. Space and time considerations do not allow me to attempt a full-blown analysis of this conjecture, which in any case I am not really qualified to undertake because of my limited exposure to alternative social science methodologies not based on rational choice and my limited knowledge of the philosophy of s cience.In Sections 4 and 5 below I describe several examples of rational choice theory and some associated novel implications. I should note that the mathematical nature of rational choice theory would appear (to me) to be crucial here. Mathematics allows the theorist to make some sense out of complicated interactions between decision-making units that would otherwise be difficult or impossible to untangle. It is precisely those kinds of situations in which rational choice theories are most likely to have novel implications, because the implications are not immediately apparent even to scholars with knowledge, experience, and intuition.We now proceed to Section 4, which provides a detailed discussion of a rational choice model of church attendance. Section 5 gives shorter summaries of several other rational choice models, including models of suicide, auto safety regulation, addiction, racial profiling, Congressional influence on military assignments, political revolutions, megafauna extinction, and the predictability of consumption spending. 4. A Detailed Example: Church AttendanceAzzi and Ehrenberg (1975) develop a rational choice model of church attendance. This is a classic paper, which Iannaccone (1998, p. 1480) calls â€Å"†¦ the first formal model for religious participation (within any discipline) and †¦ the foundation for nearly all subsequent economic models of religious behavior. † [Italics in original. ] Their analysis begins with the assumption that the utility of a household consisting of two members, a husband and a wife, is given by: (1)U = U(C1, s1, C2, s2, †¦ , Ct, st, †¦ Cn, sn, q), where Ci is the household’s consumption of market goods and services in period i (i = 1, †¦ n), and si denotes religious participation in period i. The model assumes â€Å"for simplicity† that both members of the household know how long they will live and that both will die at date n. This is a dynamic model, because t he household cares about future as well as current consumption. The remaining variable in the household utility function, q, is the â€Å"expected value of the household’s afterlife consumption. Azzi and Ehrenberg assume that church attendance follows from a â€Å"salvation motive† (the desire to increase afterlife consumption) and a â€Å"social pressure motive† (where church membership and participation increases the chances that an individual will be successful in business), rather than necessarily a pure â€Å"consumption motive† (people simply enjoy the time they spend at church). Consumption in period i (any year during which the husband and wife are alive) is given by: (2)Ci = C(xt, h1t, h2t), here xt is denotes the consumption of goods and services purchases in markets, while h1t and h2t are the amounts of time devoted by the husband and wife, respectively, to market-based consumption. The idea here is that satisfaction involves not only the purc hase of a good (such as a television) but also time spent using the good. The social value of church attendance in period i, denoted by si, is determined as follows: (3)si = s(r1i, r2i) where r1i and r2i denote the time spent on church-related activities by the husband and wife, respectively, in year i.People get more current satisfaction from going to church the more time they devote to church-related activities. After-life consumption q is determined as follows: (3)q = q(r11, r12, r21, r22, †¦ , r1n, r2n), That is, the more time spent on church-related activities during all periods of life means the more the household members will enjoy their afterlife. Azzi and Ehrenberg (p. 33, fn. 7) note that â€Å"Our household’s view of the afterlife is not one of an all-or-nothing proposition (heaven or hell), it is rather that there is a continuum of possible outcomes. †The choices of the household are constrained by time and money. The two household members can allocate time in labor [which generates income that can be used to purchase the goods and services denoted by xt in equation (1) above], consumption-related activities [reflected in h1t and h2t in equation (2) above], and church-related activities [reflected in the r1i and r2i in equation (3) above]. The constraint here is that each day has 24 hours. Hence the couple can spend more time on church-related activities only if they spend less time earning income and/or consuming.The second constraint in the model says basically that, over the course of their lives, the couple cannot spend more than their combined income. â€Å"Over the course of their lives† means that it is possible for them to borrow early in life as long as they repay the loan (with interest) later in life. It is also possible to lend early in life, which means that consumption can exceed income later. The amount of labor income the couple earns depends on the amount of time spent working by the husband and wife and t he wage rate each is paid.The model also allows for â€Å"non-labor income† in each period, which might reflect investment returns. The distinction between labor and non-labor income turns out to be rather interesting and important with respect to church attendance. Azzi and Ehrenberg’s analysis is complicated in some respects and simple in others. It is complicated because it considers consumption over several periods rather than just one, and it allows for â€Å"consumption† to depend on time (the h1t and h2t) as well as purchases of goods and services in the market (xt).The model is simple in that it does not consider the â€Å"supply side. † That is, the model simply assumes that the household can â€Å"buy† any amount that it likes of consumption goods (xt) and that there are no effective limits on religious participation (st). The power of the rational choice approach is that rational choice models tend to have lots of observable implications , some of which are novel. The Azzi and Ehrenberg model implies that: (i) The frequency of church attendance increases with age; †¢ (ii) Females attend church more frequently than males; †¢ (iii) Nonwhites attend church more frequently than whites; †¢ (iv) People who believe in an afterlife attend church more frequently; †¢ (v) Having a spouse of the same major religion increases participation; †¢ (vi) As health deteriorates church attendance declines; †¢ (vii) An increase in the number of pre-school age children present in the household reduces church attendance; †¢ (viii) An increase in the number of school-age children present in the household increases church attendance; (ix) Females’ hours devoted to religious activities will rise more rapidly with age than will the hours devoted by males to religious activities; †¢ (x) For males who show sharp earnings increases in their 20s, religious participation may first decline with age and then increase; †¢ (xi) An increase in nonlabor income will increase religious participation; and †¢ (xii) The effect of a proportionate shift in wages (say, a 10% increase in the present and all future periods) on church attendance is ambiguous. Many of these implications are not surprising, but (ix) would appear to be somewhat novel.Item (ii) means that 40 year old women will attend church more frequently than 40 year old men. Item (ix) means that the change (increase) in church participation associated with aging from 40 to 50 will be greater among women than among men. Item (ii) follows directly from the fact that females tend to have lower wages. Thus if one could find couples in which the wife earns more than the man, the model predicts for those couples that the wife will probably not be inclined to attend church more frequently. Also, allowing for an uncertain time of death may overturn (i): â€Å"†¦ nce an individual is faced with a relatively high probabilit y of death in a period it may become optimal for him to concentrate his religious participation as early as possible, since he may not survive to ‘invest’ in future periods. † (p. 38) 5. Several Brief Examples This section presents a brief overview of several applications of rational choice theory. Unlike the church attendance example above, in which the form of the utility function was written out explicitly, the discussions in this section for the most part present only brief descriptions of the relevant optimization problems and some of the resulting implications. A.Suicide Hamermesh and Soss (1974) develop a rational choice theory of suicide. They assume that the utility of an individual in any given period depends positively on â€Å"consumption† and negatively on â€Å"a technological relation describing the cost each period of maintaining [oneself] at some minimum level of subsistence. † (p. 85) â€Å"Consumption† is a function of age a nd of â€Å"permanent income,† which is a measure of current and expected future income. Individuals are assumed to vary exogenously (according to a probability distribution) in their distastes for suicide – that is, some individuals are more averse to suicide than others.This framework implies that â€Å"†¦ an individual kills himself when the total discounted lifetime utility remaining to him reaches zero. † (p. 85). Thus in this model we have a rational individual who is forward looking, considering not only his present utility but what his future utility is likely to be. If total utility over the rest of his life is higher with suicide and life ending in the present than it is with the continuation of life, suicide is the â€Å"rational† option. Here are some of the major implications of the model. (i) The suicide rate should rise with age. †¢ (ii) The suicide rate should fall with increases in permanent income[13] and decreases in the unemp loyment rate. †¢ (iii) The marginal absolute effect of permanent income on suicide declines as permanent income increases. The first two effects are by no means surprising, but the third effect is certainly by no means obvious ex ante (at least to me). (ii) means that suicide rates will fall as income rises. (iii) means that the effect of increases in income gets smaller the larger income is to begin with.A $10,000 raise is much more likely to prevent suicide if the person is earning $50,000 to begin with than if the person is earning $150,000. This is quite plausible, but the point is that it is not something most analysts would think about ex ante. B. Auto Safety Regulation. Peltzman (1975) considers the likely effects of â€Å"legally mandated installation of various safety devices[14] on automobiles. †[15] The devices in question for the most part were designed to reduce the damages caused by accidents rather than to reduce the likelihood that accidents occur. Peltzm an notes that the auto safety literature estimates the impact of afety mandates by assuming that (i) the mandates have no effect on the probability that an accident will occur, and (ii) the mandates have no effect on the voluntary demand for safety devices. In effect, the regulations were implemented based on analysis that assumed the same number and nature of accidents would occur, but that automobiles would be better equipped to protect drivers and passengers from injury and death. He notes that â€Å"[t]echnological studies imply that annual highway deaths would be 20 percent greater without legally mandated installation of various safety devices on automobiles. (p. 677) Peltzman considers the behavior of a typical driver and postulates quite reasonably that he or she is made worse off by traffic accidents – or, equivalently, that he or she benefits from safety. Peltzman also assumes, however, that the driver benefits from what he calls â€Å"driving intensity,† by which he means â€Å"more speed, thrills, etc. † (p. 681). Other things equal, the driver can obtain more driving intensity only by driving less safely. Thus the driver faces a trade-off between two goods, intensity and safety, in which more of one can be obtained only by giving up some of the other.This kind of trade-off is in standard fare for rational choice theorists. In basic consumer choice theory the consumer with a given income can obtain more of one good only if he or she consumes less of some other good (or goods). The standard consumer choice problem also considers what happens when the consumer’s income rises. Rational choice theory predicts that, in the absence of very unusual circumstances, the consumer will buy more of most goods when income rises. Put another way, it is typically not the case that a consumer will allocate one hundred percent of an increase in income to increased consumption of a single good.Income increases tend to be â€Å"spread aro und† over several goods. Peltzman argues that the imposition of mandated safety devices in automobiles is rather like an increase in income in the sense that the devices make it possible for drivers to obtain both more safety and more intensity. Technological studies in effect assume that drivers will respond by consuming only more safety, but rational choice theory indicates that drivers can also respond by consuming more intensity (that is, by driving less safely). The extent to which drivers choose between more safety and more intensity is ultimately an empirical question.Suppose drivers choose to increase consumption of both safety and intensity — which is what economists have come to expect in these kinds of situations. In this case, the rational choice model implies that the number of total driving accidents[16] should rise because of increased driving intensity, while the average amount of damage per accident – as reflected, say in the number of fatalities among passengers – should decrease because of the safety improvements. This means that it is actually possible for total traffic fatalities to rise as a result of the safety mandates!This would happen if the increase in the number of accidents is sufficiently large relative to the decrease in average damage per accident. Once again we have an example of a rational choice model yielding implications that are not obvious ex ante. The novel predictions here are that the imposition of auto safety mandates (i) should increase the occurrence of traffic accidents, and (ii) should decrease the relative frequency of accidents involving passenger fatalities, and (iii) may increase or decrease the total number of traffic fatalities.After extensive empirical testing based on several data sets, Peltzman concludes that â€Å"regulation appears not to have reduced highway deaths. † (p. 714). There is indeed some evidence that the number of deaths increased, but in most cases that ev idence is not strong. In any case, there is no evidence that the regulations decreased traffic fatalities. Peltzman also finds that the safety mandates were followed by an increase in the number of accidents involving pedestrians and by an increase in the number of accidents involving only property damage with no injury to vehicle occupants.A related paper by McCormick and Tollison (1984) considers the effect on arrest rates of an increase in the number of police officers. Rational choice theory indicates that the quality of law enforcement should not be judged by arrest rates alone. If the number of police officers increases and as a result the probability of arrest for any given crime increases, rational prospective criminals will see the expected cost of crime rise and therefore undertake fewer criminal acts.Total arrests reflect both the number of criminal acts (which should fall) and the percentage of criminal acts for which an arrest is made (which should rise). Total arrests rise only if the latter effect is stronger than the former. McCormick and Tollison test their theory using data from the Atlantic Coast Conference in men’s college basketball. In 1978, the conference increased the number of officials from two to three. In this context, one may think of officials as police officers and fouls called as arrests.McCormick and Tollison find that this 50 percent increase in the number of officials caused a 34 percent reduction in the number of fouls called (p. 229). When my son Aaron (now almost 5 years old) was an infant, he attended the Baylor Child Development Center during the day. In the room where the teacher changed diapers, there was a pad on the counter but no restraint of any kind (such as a belt or guard rail). When I asked the director about this, she said that there was no restraint because she (the director) did not want to give the teacher a false sense of security.With a belt or rail, the teacher might be tempted to walk away for â €Å"just a minute† to check on something in the room. Whether restraints increase or decrease changing table accidents is an empirical question, though Pelzman’s analysis suggests the director made the right decision. C. Addiction Stigler and Becker (1977) propose a rational choice theory of addiction, a theory subsequently elaborated by Becker and Murphy (1988). In this theory, â€Å"a person is potentially addicted to [some good] c if an increase in his current consumption of c increases his future consumption of c. (Becker and Murphy, 1988, p. 81) The key feature of these models is that a consumer’s utility in any given period depends not just on consumption in that period, but also on â€Å"consumption capital†. Consumption capital is essentially the consumer’s ability to enjoy a particular good, which depends on past consumption of the good and perhaps on other factors. If past consumption enhances current enjoyment ability, the addition is s aid to be beneficial. This might be the case, for example, with listening to classical music. The more one listens to classical music, the greater one’s capacity to appreciate it.Stigler and Becker note that beneficial consumption capital might also be positively influenced by education. Highly educated people might have a greater capacity to enjoy things like classical music, opera, and art. If past consumption reduces current enjoyment ability, the addition is said to be harmful. This is the case with substances such as heroin and other substances normally considered to be addictive. The more heroin a person consumes in the present, the less will be his or her future enjoyment (â€Å"high†) from any given amount of heroin consumption in the future. 17] The formal setup in Stigler and Becker (1977, p. 78) is relatively simple. First consider beneficial addiction – to, say, classical music. Consumer utility (U) depends positively on two goods, M (music appreciat ion) and Z (other goods): U = U(M, Z). Music appreciation depends positively on the time allocated to music listening â„ ¢ and on music consumption capital (Sm): M = M(tm, Sm). Music consumption capital at date j, Smj, depends positively on the time allocated to music consumption in the past, Mj-1, Mj-2, †¦. and positively (perhaps) on the person’s level of education at time j (denoted Ej): Smj = S(Mj-1, Mj-2, †¦ , Ej). The addition is beneficial if Smj depends on positively on the past values of M. Alternatively, for harmful addition we may replace M with H, where H denotes the consumption of a good such as heroin. In this case, consumption capital S depends negatively on past values of H. The elaborated model of Becker and Murphy (1988) views addictive behavior as a situation in which the consumption of a particular good begins to increase rapidly. [18] Their model has a number of implications. Perhaps he most interesting is their finding that the demand for ad dictive goods should be quite sensitive to permanent changes in price (where the â€Å"price† of illegal goods includes the expected costs associated with apprehension by authorities, as well as any foregone earnings that may result from becoming addicted and, say, unable to work), but not necessarily to temporary price changes. A second implication is that strong addictions, if they are to end, must end suddenly (â€Å"cold turkey†). â€Å"Rational persons end stronger addictions more rapidly than weaker ones. † (p. 692). Other implications are that â€Å"addicts often go on binges† (p. 75), â€Å"present-oriented individuals are potentially more addicted to harmful goods than future-oriented individuals† (p. 682), and â€Å"temporary events can permanently ‘hook’ rational persons to addictive goods† (p. 691). Stigler and Becker (1977) and Becker and Murphy (1988) do not perform empirical tests of their models of rational addic tion. Tests have been performed by other authors, however. Because good consumption data are not available for illegal substances, tests have focused on tobacco and caffeine. Tests based on tobacco consumption are reported by Becker, Grossman, and Murphy (1994), and Keeler, et. l. (1993). A test based on caffeine consumption is reported by Olekalns and Bardsley (1996). These tests are generally supportive of the rational addiction theory. Becker and Murphy (1988) note that with a simple extension their model can explain cycles of overeating and dieting. Their basic analysis assumes there is only one kind of consumption capital. Suppose that with respect to food there are instead two types of consumption capital, one of which is simply the person’s weight (which might be called â€Å"health capital†) and the other of which is â€Å"eating capital. That is, eating can be both harmful and beneficial in the senses defined above. As eating increases, health capital falls ( weight gain has detrimental effects on health) and eating capital rises (the capacity to enjoy food is greater the more one eats). Under appropriate conditions, utility maximization results in cycles of dieting and binging. [19] Rational addiction theory has been applied to the analysis of religious behavior – see Iannaccone (1984, 1990) and Durkin and Greeley (1991). Iannaccone (1998) summarizes this approach. Utility depends on â€Å"religious commodities† produced, the value of which depends on â€Å"religious human capital. The stock of religious human capital depends on time and money devoted to religious activities in the past. These models have the following predictions, â€Å"nearly all of which receive strong empirical support† (Iannaccone, 1998, p. 1481): †¢ Individuals tend to move toward the denominations and beliefs of their parents as they mature and start to make their own decisions about religion; †¢ People are more likely to switch de nominations early in life; †¢ People tend to marry within religions; if they do not, one spouse is likely to adopt the religion of the other.D. Racial Profiling Law enforcement authorities in many jurisdictions have been criticized in recent years for racial bias in their choice of cars to search for illegal drugs and other contraband. [20] The fact that police are more inclined to stop and search cars driven by members of certain minority groups is well established. Knowles, Persico, and Todd (2001) develop a rational choice model that â€Å"suggests an empirical test for distinguishing whether this disparity is due to racial prejudice or to the police’s objective to maximize arrests. In their model, the typical police officer â€Å"maximizes the total number of convictions minus a cost of searching cars. † (p. 209) Motorists â€Å"consider the probability of being searched in deciding whether to carry contraband. † (p. 209) At least some motorists percei ve a benefit to carrying contraband. If they do carry, their expected benefit is positive if they are not searched and negative (that is, there is a positive expected cost) if they are searched. The model implies that if police officers are not racially biased, the frequency of guilt among motorists conditional on being searched will be independent of race. 21] In their empirical analysis based on 1,590 searches on a stretch of Interstate 95 in Maryland between January 1995 and January 1999, Knowles, Persico, and Todd find support for this proposition. They interpret this result as â€Å"the absence of racial prejudice against African Americans† (p. 212). The fact remains, however, that African Americans are searched more frequently than whites. If this does not arise from racial bias by police officers, then why does it occur?One possibility noted by the authors is that â€Å"race may proxy for other variables that are unobservable by the policy officer and are correlated w ith both race and crime. Possible examples of such unobservables are the schooling level or the earnings potential of the motorist. † (p. 212) While one may quibble with some elements of this study, for our present purposes the main point is that the rational choice theory, at least potentially, yielded implications that allowed the analyst to gain some insight (if not a final resolution) into the issue of racial profiling. E. Congressional Influence on Military AssignmentsPrior to the 1960s, economic theory tended to view politicians and other government officials (bureaucrats) as disinterested observers and regulators of economic activity. A group of economics led by Nobel Laureate James Buchanan then developed a branch of economics known as public choice theory, which views government officials as self-interested maximizers. Goff and Tollison (1987) take a public choice approach to gain some understanding of casualties in the Vietnam War. The typical soldier is assumed to p refer not to be placed in risky combat situations, and this preference is shared by the soldier’s family.A solider (or more likely his family) might therefore try to gain a low-risk assignment by asking for intervention in military decisions by his Senator or Representative. Senators and Representatives are assumed to desire re-election, which implies a desire to please their constituencies. The ability of a Senator or Representative to have this kind of influence, however, varies according to committee assignments, ties to the military/industrial complex, etc. Goff and Tollison assume that political influence depends on seniority, with more seniority implying more influence.Taken together, all these assumptions have the straightforward implication that soldiers from states with more senior (and hence more influential) Senators and Representatives should, other things equal, have experienced fewer casualties in Vietnam than soldiers from states with less senior (and therefore less influential) Senators and Representatives. Their empirical analysis (using data from January 1961 to September 1972) supports the hypothesis: In the House, the Mississippi delegation had an average seniority of 27. 7, while Hawaii had an average seniority of 61. . [A seniority ranking of 1 indicates the member had the highest seniority in his or her party. ] In terms of lives, this represents about 6 fewer war deaths for every 100,000 of population in Mississippi relative to Hawaii. Ceteris paribus, this difference in House seniority leads to a 55 percent higher casualty rate for Hawaii than Mississippi. †¦ In the Senate, Arkansas had an average seniority of 6. 2, and Maryland had an average seniority of 45. 4. Other things equal †¦, this difference leads to an 86 percent higher casualty rate for Maryland than for Arkansas.In terms of lives, this translates into about 7 more war deaths for every 100,000 of population in Maryland than in Arkansas. (pp. 319-20) In this case, the value of the rational choice approach is not so much in the fact that it yields surprising answers to a well-established question, but that it suggests a unique question to ask in the first place. It is by no means obvious that someone not thinking about self-interested Senators and Representatives would even think to ask the question addressed by Goff and Tollison. F. Ideology and IntransigenceRoemer (1985) applies game theory to the analysis of political revolutions. Specifically, he presents a two-player game between â€Å"Lenin† and the â€Å"Tsar. † Lenin’s objective is to maximize the probability of revolution, while the Tsar’s objective is to minimize that probability. As in any game-theoretic setting, when making decisions each player keeps in mind how the other player might react. Lenin tries to create revolution by lining up coalitions, where people are induced to join a coalition with the promise of income redistribution.The Tsar tri es to prevent revolution by promising to punish anyone who participates in revolutionary activities (assuming the revolution attempt is unsuccessful). Increased penalties reduce the number of individuals who are likely to join the coalition but increase the revolutionary fervor of those who do. An individual will join a coalition attempting to overthrow the Tsar if the expected benefit to him or her of doing so exceeds the expected cost. There is of course some uncertainty about the outcome. Roemer’s results include the following: it is shown that various â€Å"tyrannical† aspects of the Tsar’s strategy, and â€Å"progressive† aspects of Lenin’s strategy need not flow from ideological precommitments, but are simply good optimizi