Dan Snyder's Curse

Owner's should be wary of the winner's curse in NFL free agency. It seems that we routinely see highly-regarded players bust in free agency. See: Washington Redskins.

The reason could lie in economic theory. It's the "winner's curse," or Dan Snyder's Curse. Assume the common critique of free agency is correct and that the teams that "win" in free agency by signing the big name guy actually regularly overpay for the player on average. The reason this may be is that teams pay for a player based on their estimation of his value: some definite, but unknown dollar amount.

The problem is that even the best scouts could never precisely predict a player’s value. Some overestimate his worth, others underestimate. The team that ultimately signs a player will be the one that maintains the highest estimation of his value, which likely is a team that overestimated and, as a result, overpaid.

Of course, this doesn't universally hold true. But the greater a player's bargaining power, the less the gap between his estimated value and his actual value will be (expected profit), and the more costly an error in estimation of his value is.

Ascertaining Greed

Self-righteous vitriol is rampant these days. Hurling "greed" at Wall Street has become a popular sport, but I submit that participation in the sport is a hopelessly hypocritical endeavor.

Isn't any income above a subsistence level inherently "greedy"? By definition, any amount beyond subsistence levels is not necessary. It only serves to further one's material interests in excessive comforts.

Moreover, the existence of a world of "rational actors" -- individuals who operate to maximize their own self-interests -- is the underlying assumption of most of public policy. What is so surprising about financiers being rational actors?

Do we really think that only a select group of businessmen maintain profit-maximizing motives (ie. greed, or "hubris" if you really want to go self-righteous, pseudo-intellectual)?

If we're ridiculing those who are greedy, the criticism should not stop at the financial sector. Doubtless, we all are regularly driven by the same motives of self-interest maximization.

The Libertarian Future or Present?

Maybe "South Park Republican" (read: libertarian) is an accurate description of generation X/Y conservatives.

The results of the straw poll taken of 1,757 CPAC attendees reveals some suggestive statistics. The poll does not break down the statistics by age group, but a slight majority of respondents were students.

While it is difficult to say that any of the positions voted on are necessarily contrary to a libertarian perspective, three of the four issues that received the bulk of attendee support are truly fundamental principles of libertarianism. Of the 12 possible issues, 43% of respondents rated reducing the size of the federal government as the first- or second-most important issue to them. The second-most supported issue, reducing government spending, received a cumulative 24% of the vote. At a close fourth, only behind winning the war against terrorism, was lowering taxes with a cumulative 22% of the vote.

"Promoting traditional values," the only issue listed that could be construed as possibly contrary to libertarian ideals, only received 4% "first-most" and 4% "second-most" votes. It would have been interesting to see how the vote broke on gay marriage, clearly contained within the amalgam of "traditionally values," but not necessarily an issue "traditionally values" immediately conveyed to the survey respondents.

Perhaps the poll is skewed by a slight majority of students. Perhaps it isn't. Either way, these results are a damning criticism of the present voice of conservatism's overemphasis on domestic social policy. At best, the message misrepresents the future of the Republican party. At worst, it misrepresents the party's present composition.