Monday, July 27, 2009

Increasing Long-Period Hedonic Adaptation

Now that the global economic catastrophe is over, Capitalism has been squashed, Socialism proven, and the small details of government control of markets and economies remaining for clean up by squads of graduate TAs, the economics academy is turning its wizened eye to those few remaining economics issues that continue plaguing mankind.

To wit, Sydney Brillo Duodenum found a new landmark study in his morning e-mail of Social Science Research Network Microeconomics - Intertemporal Choice and Choice Abstracts. Sandwiched between no less important studies on "Life-Cycle Variations in the Association between Current and Lifetime Earnings - Evidence for German Natives and Guest Workers" and "Estimating Intertemporal and Intratemporal Substitutions When Both Income and Substitution Effects are Present: The Role of Durable Goods," we are relieved to find attention finally being brought to bear on:
Swinger Economics

Swinging is a sexual behavior of increasing relevance but substantially ignored in theoretical economic investigation. This paper has two major goals. The first is to describe what swinger is, discuss its economic relevance and single out the main characteristics of swingers’ behavior. To this end, the Italian situation has been considered as a type of case study. The second goal is to use standard and less-standard tools from economic theory to propose some preliminary assessments of the causes and consequences of swinger couples’ behavior. In this respect, some contributions on two-sided markets, hedonic adaptation approaches and equilibrium matching models have proved particularly useful.

This study by Fabio D'Orlando of the University of Cassino and Cream (!?!?!) Economic Center focuses on the Italian swingers market, as it were. With precision exposition, D'Orlando addresses this two-sided market (yuck, yuck) and even includes auto-economic erotic imagery:

Oh, baby.

SBD does not want to rob his readers of the pleasures of this study, but given the importance of this subject to the preservation of western civilization, he understands that the more known now about this, the better his readers will sleep tonight. D'Orlando concludes:

. . . the theoretical approaches which seem best suited to capture the empirical data are those based on the concept of hedonic adaptation. These approaches suggest that it is consistent with maximizing swinger strategy to begin from soft swinging and only later engage in “harder” swinging, and that also the search for ever new sexual experiences delays long-period hedonic adaptation and hence increases swingers’ long-period well being. Both these theoretical predictions seem to find confirmation in the empirical data on swinger behaviour.

Yes, it's all about long-period hedonic adaptation.

Next, SBD will look at this ground breaking study:

How Do Policy-Makers Actually Solve Problems? Evidence from the French Local Public Sector.

No doubt wine, some brie, and a baguette are involved. And a nap, too.