Monday, March 05, 2012

Moneyball: this is not a review

I recently watched Moneyball.

One of the most moving scenes in the movie is the one where you watch Billy Beane begins to assemble a team from players who have been overlooked by other teams. You can see how much it matters to them when he asks him to play for him.

What does this imply for my post about Meritocracy?

Doesn't it show that free markets reward talent? Doesn't it show that free markets reward those who can see the value in outsiders and put them to work? Doesn't it show that free markets are meritocracies, and isn't that a good thing?
My answers to these questions would be: yes, yes, and a qualified no.

Markets are wonderful. We should try to find the right person for the job, and we should reward people for doing their jobs well. The bourgeois virtues are very real.

My post on Merit was not an argument against using markets.

Since the 1980s, the best cricket players in India have been growing ever richer. However, that they earn a hundred times what their predecessors used to earn doesn't mean that they are a hundred times as good at the game. They have grown richer mainly because Indians now watch television. In some other countries, the benefits have gone to Football players, while in other countries, Basketball players have gained. These beneficiaries may be great athletes, and they "deserve" their incomes in the sense that this is what others willingly pay them in the marketplace. They are like landlords who have seen the value of their properties explode because someone else built a highway or a railway station nearby.

Hockey is supposedly India's "National Game" and the Indian Hockey team is the most successful team in Olympic History. However, they earn a fraction of what Cricketers earn. There are excellent historical and infrastructural reasons for this. However, to say that Cricket is a better team than Hockey, or that Cricketers are better athletes than Hockey players would be silly. That is my first point: however hard we work, and these athletes work very hard indeed, we underestimate the contribution of luck to our wealth.

Merit, in the sense in which we use it here, is also a morally neutral term. In the movie, Billy Beane recruits players whom others won't touch because they are arrogant, or because they take drugs and frequent strip clubs. As he puts it, all he cares about is whether they are cheap and can "get on base". Personally, I have no problems with people who use drugs or go to strip clubs. The point I am trying to make is that if Billy Beane is rewarding merit, both merit and reward are of the narrowest kind: he reognizes technical competence, and rewards it with money.

Billy Beane was doing The Market's work, and that is good. However, The Market giveth, and the Market taketh away.

We underestimate the importance of the environment: we see those who thrive and see that they are intelligent, hard-working, and conscientous, and they often are! We then assume that they would have thrived in all possible worlds. We don't notice that many of those who are left behind are also were hard-working and dilgent. We also forget that we often seem most virtuous (energetic, optimistic, generous) when things are going our way.

This has moral consequences: instead of being grateful, the successful evolve a fine sense of entitlement, while the defeated blame themselves. This is not only a human tragedy, but a mistaken understanding of how the world works.

Note: Prices are a signal. When wages rise, workers should move into that industry. However, the number of spots on the Indian Cricket team is limited to 11 (plus extras). What we see are more players trying to get in, and a few who do make it and earn huge sums. Most of us do not work in such industries. When wages rise, people enter our industry.
However, this does not mitigate the tragedy of declining industries: I doubt former steel plant engineers are any less intelligent or hardworking that programmers, but they cannot easily start over again.

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