Dictionary of Arguments

Philosophical and Scientific Issues in Dispute

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Adam Smith Problem	Economic Theories	Otteson I 24 Adam Smith Problem/economic theories/Otteson: [There is a] historical and scholarly issue known as the “Adam Smith Problem,” which alleges a rift between the account of morality Smith gives in TMS⁽¹⁾, on the one hand, and the seemingly different account of political economy Smith gives in his Wealth of Nations⁽²⁾, on the other. Can the two accounts be reconciled? Otteson: (….) both accounts could be reconciled by a proper understanding of Smith’s “political economy” project. >Political economy/Smith, >Morality/Adam Smith, >Stages of Development/Adam Smith, >Justice/Adam Smith. Spontaneous order: The explanation Smith offers for the development of moral standards holds the process to create what we today might call "spontaneous order." A spontaneous order is a system that arises, as Smith's contemporary Adam Ferguson put it, as "the result ofhuman action, but not the execution of any human design" (Ferguson, 1996⁽³⁾ [1767]: 119). As this theory was developed by twentieth-century thinkers like Michael Polanyi and Friedrich Hayek, it referred to the development of an orderly system that arose from the decentralized actions of individuals but without their intending to design any overall system. Language is a good example. The English language is a relatively orderly system: it contains rules of grammar, definitions of words, and accepted or acceptable pronunciations, but there was no single person or group of persons who invented or designed it. It lives and changes according to the purposes and desires of the users of the language, and its rules are generated and enforced by the users themselves. Another prime example of spontaneous order is ecosystems. Otteson I 25 One more example of spontaneous order: an economic market. As Smith would go on to describe in his Wealth of Nations⁽²⁾, the individual actors in economic markets certainly have intentions - they all want, in his words, to "better their own condition" (WN⁽¹⁾ 345) - but they nevertheless typically do not have any larger intentions in mind regarding an overall system of market order. They just want to achieve their localized purposes in cooperation with other willing individuals. Yet individuals' decentralized attempts to achieve their purposes lead to the development of patterns and even principles of behavior that can look as if some wise person designed it all. Adam Smith Problem/Solution/Spontaneous order/Smith:. Smith's argument is that human morality is a social system that arises – (…) like markets - on the basis of countless individual decisions, actions, and interactions but without any overall plan and with no overall designer. >Rules/Adam Smith. 1. Smith, Adam (1982) [1759]. The Theory of Moral Sentiments. D. D. Raphael and A. L. Macfie, eds. Liberty Fund. 2. Smith, Adam. (1776) The Wealth of Nations. London: W. Strahan and T. Cadell. 3 Ferguson, Adam (1996) [1767]. An Essay on the History of Civil Society. Edited by Fania Oz-Salzberger. Cambridge University Press.	Otteson I James R. Otteson The Essential Adam Smith Vancouver: Fraser Institute. 2018
Algorithms	Pentland	Brockman I 204 Algorithms/Pentland: If we have the data that go into and out of each decision, we can easily ask, Is this a fair algorithm? Is this AI doing things that we as humans believe are ethical? This human in-the-loop approach is called “open algorithms”; you get to see what the Als take as input and what they decide using that input. If you see those two things, you’ll know whether they’re doing the right thing or the wrong thing. It turns out that’s not hard to do. If you control the data, then you control the AI. >Artificial intelligence/Pentland, >Ecosystems/Pentland, >Decision-making processes/Pentland, >Cybernetics/Pentland. Pentland, A. “The Human strategy” in: Brockman, John (ed.) 2019. Twenty-Five Ways of Looking at AI. New York: Penguin Press.	Brockman I John Brockman Possible Minds: Twenty-Five Ways of Looking at AI New York 2019
Artificial Intelligence	Pentland	Brockman I 200 Artificial intelligence/Pentland: On the horizon is a vision of how we can make humanity more intelligent by building a human AI. It’s a vision composed of two threads. One is data that we can all trust- data that have been vetted by a broad community, data where the algorithms are known and monitored, much like the census data we all automatically rely on as at least approximately correct. The other is a fair, data-driven assessment of public norms, policy, and government, based on trusted data about current conditions. >Cybernetics/Pentland, >Ecosystems/Pentland, >Decision-making Processes/Pentland, >Data/Pentland. Brockman I 204 One thing people often fail to mention is that all the worries about AI are the same as the worries about today’s government. For most parts of the government - the justice system, etc. - there’s no reliable data about what they’re doing and in what situation. VsArtificial intelligence/Pentland: Current AI is doing descriptive statistics in a way that’s not science and would be almost impossible to make into science. To build robust systems, we need to know the science behind data. Solution/Pentland: The systems I view as next-generation Als result from this science- based approach: If you’re going to create an AI to deal with something physical, then you should build the laws of physics into it as your descriptive functions, in place of those stupid little neurons. >Ecosystem/Pentland. ing algorithms. When you replace the stupid neurons with ones that capture the basics of human behavior, then you can identify trends with very little data, and you can deal with huge levels of noise. The fact that humans have a “commonsense” understanding that they bring to most Brockman I 205 problems suggests what I call the human strategy: Human society is a network just like the neural nets trained for deep learning, but the “neurons” in human society are a lot smarter. Pentland, A. “The Human strategy” in: Brockman, John (ed.) 2019. Twenty-Five Ways of Looking at AI. New York: Penguin Press.	Brockman I John Brockman Possible Minds: Twenty-Five Ways of Looking at AI New York 2019
Climate Costs	United States	Norgaard I 178 Climate Costs/Losses/United States: The original United States Environmental Protection Administration (USEPA) studies of the damages from climate change were exclusively concerned with measuring effects in the United States (Smith and Tirpak 1989⁾⁽¹⁾. The analyses examined the consequences of the equilibrium climate that would be caused by doubling carbon dioxide (CO₂) concentrations in the earth (550 ppm). The USEPA studies did not address the dynamics of impacts over time. For example, the coastal, forestry, and ecosystem studies involve sectors that take decades if not centuries to adjust. The studies did not capture how these costs evolved over time. The USEPA studies revealed that a limited number of economic sectors were vulnerable to climate change: agriculture, coastal, energy, forestry, infrastructure, and water. In addition, several non‐market sectors were also vulnerable including recreation, ecosystems, endangered species, and health. Subsequent economic studies attempted to value the US economic damages associated with these impacts in terms of dollars (Nordhaus 1991⁽²⁾; Cline 1992⁽³⁾; Titus 1992⁽⁴⁾; Fankhauser 1995⁽⁵⁾; Tol 1995⁽⁶⁾). These economic results were summarized in the Second Assessment Report of the Intergovernmental Panel on Climate Change (Pearce et al. 1996)⁽⁷⁾. The aggregate damage estimates to the US for doubling greenhouse gases (550 ppm) range from 1.0 to 2.5 percent of GDP. The damage estimates varied widely across the different authors reviewed even though each author relied on the same original USEPA sectoral studies. Most of the other authors [excluding Cline and Frankhauser] assumed that ecosystem change would not necessarily be this harmful. Norgaard I 179 Climate Costs/Losses: Two studies went beyond the US and predicted impacts across the world (Fankhauser 1995⁽⁵⁾; Tol 1995⁽⁶⁾). Unfortunately, there was little evidence at the time to base this extrapolation upon other than population and income. They predicted global impacts from doubling CO would range from 1.4 to 1.9 percent of Gross World Product (GWP). They predicted that the bulk of these damages would fall on the OECD (60 to 67 percent) because they assumed that damages were proportional to income. Only 20 to 37 percent of the damages were predicted to fall on low latitude countries, although this would amount to a higher fraction of their GDP (over 6 percent). Africa, southern Asia, and southeast Asia (not including China) were predicted to be the most sensitive to warming with losses over 8 percent of GDP (Tol 1995)⁽⁶⁾. If temperatures could rise to 10 °C in future centuries, damages could rise to 6 percent of GWP (Cline 1992)⁽³⁾. Vs: (…) this is based largely on just extrapolating the results of the doubling experiment rather than upon additional research concerning higher temperatures. (…) the current present value of a ton of carbon would lead to damages on the order of $5 to $12 per ton (Pearce et al. 1996)⁽⁷⁾. This is equivalent to $1.4 to $3.3 per ton of carbon dioxide. This social cost of carbon should rise over time at approximately a 2 percent rate to account for the rising marginal damages associated with accumulating greenhouse gases in the atmosphere. Such low prices will not stop greenhouse gases from accumulating over this century, they will simply slow them down (Nordhaus 1991)⁽²⁾. Climate Costs/Catastrophes: The IPCC report also considered catastrophe. If temperatures were 6°C warmer by 2090, ‘experts’ predicted an 18 percent chance that damages would be greater than 25 percent of GWP (Nordhaus 1994)⁽⁸⁾. In this case, experts included economists but also natural scientists unfamiliar with damage estimation. The three catastrophes identified in the IPCC report are a runaway greenhouse gas effect, disintegration of the West Antarctic ice sheet, and major changes in ocean currents (Pearce et al. 1996)⁽⁷⁾. >Emission permits, >Emission reduction credits, >Emission targets, >Emissions, >Emissions trading, >Climate change, >Climate damage, >Energy policy, >Clean Energy Standards, >Climate data, >Climate history, >Climate justice, >Climate periods, >Climate targets, >Climate impact research, >Carbon price, >Carbon price coordination, >Carbon price strategies, >Carbon tax, >Carbon tax strategies. 1. Smith, J., and Tirpak, D. 1989. Potential Effects of Global Climate Change on the United States. Washington, DC: US Environmental Protection Agency. 2. Nordhaus, W. 1991. To slow or not to slow: The economics of the greenhouse effect. Economic Journal 101: 920–37. 3. Cline, W. 1992. The Economics of Global Warming. Washington, DC: Institute of International Economics. 4. Titus, J. G. 1992. The cost of climate change to the United States. In S. Majumdar, L. Kalkstein, B. Yarnal, E. Miller, and L. Rosenfeld (eds.), Global Climate Change: Implications, Challenges, and Mitigation Measures. Easton, PA: Pennsylvania Academy of Sciences. 5. Fankhauser, S. 1995. Valuing Climate Change: The Economics of the Greenhouse. London: Earthscan. 6. Tol, R. 1995. The damage costs of climate change: Towards more comprehensive estimates. Environmental and Resource Economics 5: 353–74. 7. Pearce, D. et al. 1996. The social cost of climate change: Greenhouse damage and the benefits of control. Pp. 179–224 in Intergovernmental Panel on Climate Change, Climate Change 1995: Economic and Social Dimensions of Climate Change. Cambridge: Cambridge University Press. 8. Nordhaus, W. 1994. Managing the Global Commons. The Economics of Climate Change. MIT Press, Cambridge, MA. Mendelsohn, Robert: “Economic Estimates of the Damages Caused by Climate Change”, In: John S. Dryzek, Richard B. Norgaard, David Schlosberg (eds.) (2011): The Oxford Handbook of Climate Change and Society. Oxford: Oxford University Press.	Norgaard I Richard Norgaard John S. Dryzek The Oxford Handbook of Climate Change and Society Oxford 2011
Concentration Risk	IMF Working Papers	IMF V 7 Concentration Risk/cryptocurrency/IMF/Hacibedel/Perez-Saiz: Despite the decentralized design of crypto assets, concentration and propagation risks in the crypto industry are relatively high. In theory, the decentralized nature of crypto assets makes them less prone to a single point of failure risk, as multiple nodes and validators potentially spread around the world (Bains et al., 2022)⁽¹⁾. Decentralization could improve security as well as reduce the need for trust in a single entity. In practice, concentration has also increased over the years due to high network effects, scale economies or the need to diversify risks. IMF V 7/8 There has been a remarkable trend towards concentration in the industry through the formation of large mining pools, the dominance of Bitcoin and Ethereum - currently representing more than half of the total market capitalization of crypto assets - or the emergence of large exchange platforms and wallets (see Cong et al., 2021⁽²⁾; Makarov and Schoar, 2021)^⁽³⁾. Network effects or scale economies are also relatively important in this industry (see Halaburda et al., 2022)⁽⁴⁾, which tends to raise concentration over time and increase the systemic importance of some key actors in the industry.* Decentralization: Decentralization of crypto assets and a high reliance on complex technologies and automatization elevates the importance of operational vulnerabilities and cyber risk in the crypto eco system. Crypto: Crypto technologies a) often rely on automated processes with little or no human intervention; b) are constantly evolving and transmuting, a source of rapid innovation; and c) they are decentralized by design which makes governance more difficult. Cyber risks: Cyber risks are estimated to be elevated in most types of crypto assets as complex technologies, actors, and weak governance are involved. Indeed, emerging financial technologies are particularly exposed to cyber-attacks given their high reliance on technology.** >Cryptocurrency risks, >Cryptocurrency, >Crypto transactions, >Fake transactions, >Cross-border payments, >Money laundry, >Crypto regulation, >Blockchain, >Bitcoin, >Crypto Firms, >Crypto and Banking, >Payment systems, >Stablecoins. * The recent collapse of FTX, a large crypto conglomerate, highlighted the inadequate governance and opaque corporate interlinkages that could arise among large crypto players (…). **In 2021, the two largest crypto-related loses were estimated at about $2 billion each, compared to an estimated operational risk losses of about $15 billion for the financial sector (Risk.net “Top 10 op risk losses for 2021 hog $15bn total”, 14 January 2022). 1. Bains, P., Ismail, A., Melo, F. and Sugimoto, N., 2022. Regulating the Crypto Ecosystem: The Case of Unbacked Crypto Assets. IMF FinTech Notes, 2022 (007). 2. Cong, L.W., He, Z. and Li, J., 2021. Decentralized mining in centralized pools. The Review of Financial Studies, 34(3), pp.1191-1235. 3. Makarov, I. and Schoar, A., 2021. Blockchain analysis of the bitcoin market (No. w29396). National Bureau of Economic Research. 4. Halaburda, H., Haeringer, G., Gans, J. and Gandal, N., 2022. The microeconomics of cryptocurrencies. Journal of Economic Literature, 60(3), pp.971-1013.	IMF II IMF Working Paper André Reslow Gabriel Söderberg, Cross-Border Payments with Retail Central Bank Digital Currencies: Design and Policy Considerations IMF Fintech Note 2024/002 Washington, DC. 2024 IMF III IMF Working Papers Clemens Graf von Luckner Robin Koepke, Crypto as a Marketplace for Capital Flight. IMF Working Paper 24/133 Washington, DC. 2024 IMF IV IMF Working Papers Marco Pani Rodolfo Maino, “Could Digital Currencies Lead to the Disappearance of Cash from the Market? Insights from a ’Merchant-Customer’ Model.” IMF Working Paper WP/25/56 Washington, DC. 2025
Crypto and Macroeconomics	IMF Working Papers	IMF V 3 Crypto and Macroeconomics/IMF/Hacibedel/Perez-Saiz: Linkages of crypto assets with the rest of the economy are still limited but are being established rapidly as crypto assets become more widely used. While crypto asset technologies could create de facto a new and alternative financial system, linkages with the traditional financial sector can be substantial. Considering how crypto assets interact with the real, fiscal, or external and financial sectors, they may pose significant risks to macroeconomic and financial stability. >Cryptocurrency risks, >Cryptocurrency, >Crypto transactions, >Fake transactions, >Cross-border payments, >Money laundry, >Crypto regulation, >Blockchain, >Bitcoin, >Crypto Firms, >Crypto and Banking, >Payment systems, >Stablecoins. Literature: A recent G20 note prepared by the IMF summarizes implications of crypto assets for domestic and external stability and the structure of financial systems (IMF 2023b)⁽¹⁾. Crypto assets have also been widely covered in recent IMF Global Financial Stability Reports (IMF, 2021a⁽²⁾; IMF, 2022a⁽³⁾), Article IV staff reports (e.g., El Salvador 2021⁽⁴⁾, Marshall Islands 2022, or Central African Republic 2023⁽⁵⁾), and Financial System Stability Assessments (e.g. Sweden 2023, Ireland 2022, or Hong Kong 2021), among others. 1. International Monetary Fund, 2023b. G20 Note on the Macrofinancial Implications of Crypto Assets, IMF G20 Note, February 2023. 2. International Monetary Fund, 2021a. The Crypto Ecosystem and Financial Stability Challenges. Global Financial Stability Report, Chapter 2, October 2021. 3. International Monetary Fund, 2022a. The Rapid Growth of Fintech: Vulnerabilities and Challenges for Financial Stability. Global Financial Stability Report, Chapter 3, April 2022. 4. International Monetary Fund, 2022c. El Salvador: 2021 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for El Salvador, January 2022. 5. International Monetary Fund, 2023c. Central African Republic: 2023 Article IV Consultation and request for a 38-month arrangement under the Extended Credit Facility-Press Release; Staff Report; and Statement by the Executive Director for the Central African Republic, May 2023.	IMF II IMF Working Paper André Reslow Gabriel Söderberg, Cross-Border Payments with Retail Central Bank Digital Currencies: Design and Policy Considerations IMF Fintech Note 2024/002 Washington, DC. 2024 IMF III IMF Working Papers Clemens Graf von Luckner Robin Koepke, Crypto as a Marketplace for Capital Flight. IMF Working Paper 24/133 Washington, DC. 2024 IMF IV IMF Working Papers Marco Pani Rodolfo Maino, “Could Digital Currencies Lead to the Disappearance of Cash from the Market? Insights from a ’Merchant-Customer’ Model.” IMF Working Paper WP/25/56 Washington, DC. 2025
Crypto Pseudonymity	IMF Working Papers	IMF VI 3 Pseudonymity of cryptocurrency/IMF/Reuter: (…] [there is a] common misconception - contrary to popular belief, the vast majority of crypto assets do not provide anonymity. Every transaction is publicly recorded on a freely accessible ledger known as a blockchain. The perception of anonymity arises because blockchain data is pseudonymized; rather than recording personal information such as names or residences, blockchains log only the wallet addresses of senders and receivers. A wallet address, typically a long hexadecimal string such as '0xdFDEe1155E1dd7c01774560C6E98C41B7da945dB', does not directly reveal personal information about the user. The key challenge in mapping the geography of crypto asset flows is supplementing blockchain data with useful information about senders and receivers. Our methodology* addresses this challenge by enabling the estimation of the geographic region of any arbitrary self-custodial wallet** in the Ethereum ecosystem. >Cryptocurrency risks, >Cryptocurrency, >Crypto transactions, >Fake transactions, >Cross-border payments, >Money laundry, >Crypto regulation, >Blockchain, >Bitcoin, >Crypto Firms, >Crypto and Banking, >Payment systems, >Stablecoins, >Ethereum. * Marco Reuter. (2025) Decrypting Crypto: How to Estimate International Stablecoin Flows. IMF Working Paper 25/141. ** A self-custodial wallet is a type of crypto wallet where the user has full control and responsibility over their funds, without relying on third-party intermediaries for custody. Name systems allow users to replace the long hexadecimal strings with human-readable names. A similar system, the Domain Name System (DNS) is at the core of the internet, replacing numerical IP-addresses with domain names in the common “www.xyz.com” format.	IMF II IMF Working Paper André Reslow Gabriel Söderberg, Cross-Border Payments with Retail Central Bank Digital Currencies: Design and Policy Considerations IMF Fintech Note 2024/002 Washington, DC. 2024 IMF III IMF Working Papers Clemens Graf von Luckner Robin Koepke, Crypto as a Marketplace for Capital Flight. IMF Working Paper 24/133 Washington, DC. 2024 IMF IV IMF Working Papers Marco Pani Rodolfo Maino, “Could Digital Currencies Lead to the Disappearance of Cash from the Market? Insights from a ’Merchant-Customer’ Model.” IMF Working Paper WP/25/56 Washington, DC. 2025
Crypto Wash Trading	NBER Working Papers	NBER I 2 Crypto wash trading/NBER/Cong/Li/Tang/Yang: Wash trading on crypto exchanges warrants our attention for several reasons. First, crypto exchanges play essential roles in the industry (e.g., Amiram, Lyandres, and Rabetti, 2022)(1), providing liquidity and facilitating price discovery just like traditional exchanges. Many crypto exchanges have expanded into upstream (e.g., mining) and downstream (e.g.,payment) sectors, consequently wielding great influence as a complex of trading platforms, custodians, banks, and clearinghouses. Naturally, crypto exchanges constitute an anchoring point for understanding the ecosystem from academic, industrial, and regulatory perspectives. Second, because liquidity begets liquidity, crypto exchanges have strong economic incentives to inflate trading volumes to increase brand awareness and ranks on third-party aggregator websites or media (e.g., CoinMarketCap, CoinGecko, Bitcointalk, and Reddit), which in turn increases the exchanges’ profits from transaction fees.)* Third, while wash trading is largely prohibited in most financial markets and developed economies (IOSCO, 2000)⁽²⁾,cryptocurrencies are particularly prone to wash trading under limited regulatory oversight. >Cryptocurrency risks, >Cryptocurrency, >Crypto transactions, >Fake transactions, >Cross-border payments, >Money laundry, >Crypto regulation, >Blockchain, >Bitcoin, >Crypto Firms, >Crypto and Banking, >Payment systems, >Stablecoins, >Ethereum, >Wash trade. NBER I 4 We find that an exchange’s wash trading is positively correlated with its cryptocurrency prices over the short term. We also find that exchanges with longer establishment histories and larger userbases wash trade less. Less prominent exchanges, in contrast, have short-term incentives for wash trading without drawing too much attention. Moreover, wash trading is positively predicted by returns and negatively by price volatility. NBER I 4/5 While current business incentives and ranking systems fuel the rampant wash trading on unregulated exchanges, the regulated exchanges, having committed considerable resources towards compliance and license acquisition and facing severe punishments for market manipulation (Perez, 2015)⁽⁵⁾, do little wash trading. NBER I 27 Note that wash traders in traditional markets tend to be traders rather than exchanges, yetindividuals’ wash trades alone cannot fully explain the differences we observe between regulated and unregulated exchanges. Moreover, individuals’ cost of wash trading should be related to fees charged and bid-ask spreads (which they have to pay if others cross their orders before they do). But we do not find a systematic correlation between the extent of wash trading and these variables. NBER I 28 In contrast, evidence** abounds that exchanges themselves wash trade either directly or indirectly. Top executives at crypto exchanges are known to trade on their own exchanges while operating cryptocurrency hedge funds (e.g., Bitfinex’ed, 2017)⁽⁶⁾; multiple exchanges have also pleaded guilty to direct wash trading (Sinclair, 2020)⁽⁷⁾. Indirect wash trading by the exchanges could be through fee rebates that some exchanges use to incentivize their customers to wash trade. For example, Fcoin rewards platform tokens for trade mining: those individuals who trade more get more FT tokens. * We are not claiming that all wash trading is done by the exchanges. Individuals could wash trade as well. For example, non-fungible tokens (NFTs) had a breakout year in 2021, and it is documented that traders use wash trading to net millions of profits (Cong, Landsman, Maydew, and Rabetti, 2022⁽³⁾; Quiroz-Gutierrez, 2022)⁽⁴⁾. ** Lin William Cong, Xi Li, Ke Tang, and Yang Yang. (2022). Crypto Wash Trading. NBER Working Paper No. 30783. Cambridge, MA. 1. Amiram, D., Lyandres, E., and Rabetti, D. (2022). Competition and Product Quality: Fake Trading on Crypto Exchanges. Working Paper 2. IOSCO. (2000). A Resolution on IASC Standards. In: Presidents' Committee of IOSCO Madrid, Spain. 3. Cong, L. W., Landsman, W. R., Maydew E. L., and Rabetti, D. (2022). Tax-Loss Harvesting with Cryptocurrencies. Available at SSRN 4033617. 4. Quiroz-Gutierrez, M. (2022). A handful of NTF users are making big money off of a stealth scam. Here's how `wash trading' works. Fortune Feb 4 5. Perez, Y. B. (2015). The Real Cost of Applying for a New York BitLicense. Coindesk, Aug 13, Retrieved from https://www.coindesk.com/real-cost-applying-new-york-bitlicense 6. Bitfinex'ed. (2017). Wash Trading Bitcoin Part II: Who and why is someone wash trading on Bitfinex? Medium.com Oct 22. Retrived from https://medium.com/@bitfinexed/wash-trading-bitcoin-part-ii-whoand-why-is-someone-wash-trading-on-bitfinex-e1c7b5e0b3bb 7. Sinclair, S. (2020). Canada Crypto Exchange Coinsquare Accused of Wash Trading by Watchdog. Coindesk, July 20, Policy and Regulation	Link to abbreviations/authors
Cryptocurrency Industry	NBER Working Papers	NBER I 1 Cryptocurrency Industry/NBER/Cong/Li/Tang/Yang: Both financial institutions and retail investors have significant exposure to the cryptocurrency industry (Bogart, 2019⁽¹⁾; FCA, 2019⁽²⁾; Fidelity, 2019⁽³⁾; Henry, Huynh, and Nicholls, 2019)⁽⁴⁾.* Meanwhile, crypto exchanges, arguably the most profitable players in the ecosystem, remain mostly unregulated. As recent as mid 2022, regulated exchanges (Coinbase, BitStamp, Gemini, BitFlyer, Tibit, etc.) still only constitute less than 3% of spot market transactions. In the process of vying for dominance in this lightly regulated market, some exchanges are suspected of gaining an advantage in ethically and legally questionableways (Rodgers (Forbes), 2019⁽⁵⁾; Vigna (WSJ), 2019⁽⁶⁾; BTI, 2019)⁽⁷⁾. One form of such market manipulation is Wash trading - investors simultaneously selling and buying the same financial assets to create artificial activity in the marketplace, which is known to distort price, volume, and volatility, and reduce investors’ confidence and participation in financial markets (Aggarwal and Wu, 2006⁽⁸⁾; Cumming, Johan, and Li, 2011⁽⁹⁾; Imisiker and Tas, 2018)⁽¹⁰⁾. >Cryptocurrency risks, >Cryptocurrency, >Crypto transactions, >Fake transactions, >Cross-border payments, >Money laundry, >Crypto regulation, >Blockchain, >Bitcoin, >Crypto Firms, >Crypto and Banking, >Payment systems, >Stablecoins, >Ethereum, >Wash trade. * Surveys reveal that 22% of institutional investors have invested in cryptocurrencies (Fidelity, 2019)⁽³⁾ and by April 2019 9% of adults have owned Bitcoins in particular (Bogart, 2019)⁽¹⁾. In the UK, 25% consumers could identify “cryptocurrency” and 3% had bought them (FCA, 2019)⁽²⁾. Between 2016 and 2018, Bitcoin ownership increased from 3% to 5% (Henry et al., 2019)⁽⁴⁾. 1. Bogart, S. (2019). Blockchain Capital Bitcoin Survey. Retrieved from https://medium.com/blockchain-capitalblog/bitcoin-is-a-demographic-mega-trend-data-analysis-160d2f7731e5? 2. FCA. (2019). Cryptoassets: Ownership and attitudes in the UK. (Financial Conduct Authority). Retrieved from https://www.fca.org.uk/publication/research/cryptoassets-ownership-attitudes-uk-consumer-surveyresearch-report.pdf 3. Fidelity. (2019). Institutional Investments in Digital Assets. Retrieved from https://s2.q4cdn.com/997146844/files/doc_news/archive/59439969-390c-4354-94a9-772219d0b8b9.pdf 4. Henry, C. S., Huynh, K. P., and Nicholls, G. (2019). Bitcoin Awareness and Usage in Canada: An Update. The Journal of Investing, 28(3), 21-31. 5. Rodgers, T. (2019). 95% Of Volume Could Be Wash trading As Bitcoin Price Surges. Forbes, Apr 4. 6. Vigna, Paul. (2019). Most Bitcoin Trading Faked by Unregulated Exchanges, Study Finds. The Wall Street Journal, March 22 7. BTI. (2019). Blockchain Transparency Institute April Summary of Market Surveillance Report Retrieved from https://www.bti.live/reports-april2019/ 8. Aggarwal, R. K., and Wu, G. (2006). Stock market manipulations. The Journal of Business, 79(4), 1915-1953. 9. Cumming, D., Johan, S., and Li, D. (2011). Exchange trading rules and stock market liquidity. Journal of Financial Economics, 99(3), 651-671. 10. Imisiker, S., and Tas, B. K. O. (2018). Wash trades as a stock market manipulation tool. Journal of behavioral and experimental finance, 20, 92-98.	Link to abbreviations/authors
Cryptocurrency Regulation	NBER Working Papers	NBER I 31 Crypto regulation/wash trading/NBER/Cong/Li/Tang/Yang: Evidently, the supposedly decentralized crypto ecosystems do have centralized players such as the exchanges, which are prone not only to being hacked but also to manipulative behavior. This casts shadows over the industry’s development, adding to what the critics have voiced about the limitation of the technology and the fraudulent nature of the industry (Roubini, 2018)⁽¹⁾. Our findings* add new insights concerning the role of regulation. NBER I 32 We demonstrate that regulated and unregulated exchanges exhibit vastly divergent trading patterns. Without claiming causality, we offer three potential interpretations of the results. First, regulated exchanges are directly required to follow the regulation, and violations are severely punished. For example, the regulator can issue heavy fines for unregulated behavior,which hurts the balance sheet of the company as well as its reputation/goodwill. Furthermore, because regulated exchanges spent enormous resources obtaining the license, it will be an unbearable loss for them to have the license revoked and the business expelled from the jurisdiction, as outlined in sections 23 CRR-NY 200.3 and 200.6 of the New York Codes, Rules and Regulations (BitLicense, 2015)⁽²⁾. The centralized nature of these exchanges, while ironic when we consider the origins of blockchains and decentralized finance, does make direct inspections and the enforcement of regulation on crypto exchanges much more feasible than on other (often anonymous) agents. For wash trading specifically, the two major categories of wash trading techniques, exchange forged data and incentivized wash trading programs, can all be heavily prevented by regulation. Incentivized wash trading campaigns are prohibited by law obviously. Exchange faked trading records are nearly impossible when they are required to regularly submit data ‘for each transaction, the amount, date, and precise time of the transaction, any payment instructions, the total amount of fees and charges received and paid to, by, or on behalf of the licensee’ (23 CRR-NY 200.12, New York Codes, Rules and Regulations).* Second, it is possible that compliance with regulation is costly but does not affect wash trading incentives directly. Some firms simply get a license to signal their quality (e.g., Spence, 1978)⁽³⁾. This is inconsistent with the observation that after acquiring the license, regulated exchanges still do not wash trade. Third, some unobserved exchange characteristics may cause the exchange to refrain fromwash trading and acquire licenses at the same time. Such a screening function is plausible and would imply that by observing which exchanges are regulated, traders can tell whether wash trading takes place on a particular exchange. >Cryptocurrency risks, >Cryptocurrency, >Crypto transactions, >Fake transactions, >Cross-border payments, >Money laundry, >Crypto regulation, >Blockchain, >Bitcoin, >Crypto Firms, >Crypto and Banking, >Payment systems, >Stablecoins, >Ethereum, >Wash trade. * Lin William Cong, Xi Li, Ke Tang, and Yang Yang. (2022). Crypto Wash Trading. NBER Working Paper No. 30783. Cambridge, MA. Why do investors trade on unregulated exchanges? Most exchanges started as unregulated and regulation was only introduced gradually. Many investors were unaware of wash trading until 2019, and do not treat regulatory status as their primary decision variable, especially if they have already been trading on an exchange. Customer acquisitions by unregulated and regulated exchanges are also thus far centered around various promotions, fee cut, reputation within the industry, perceived liquidity, etc. *Regulators, with basic forensic tools, can easily find wash trading evidence with this level of trading records. For example, the exchange account carrying wash trading activities are likely to exhibit abnormally large volume as well as unusual behavior patterns (like Willy and Markus in Mt Gox). Besides, wash trading volume do not bring trading fee revenues, so exchanges need to work hard to cover the tells in the balance sheet. Regulators can also find suspicious wash trading from the trading volume and user scale and custodian assets size. 1. Roubini, N. (2018). Testimony for the Hearing of the US Senate Committee on Banking, Housing and Community Affairs On “Exploring the Cryptocurrency and Blockchain Ecosystem. Retrieved from https://www.banking.senate.gov/imo/media/doc/Roubini%20Testimony%2010-11-18.pdf 2. BitLicense. (2015). Regulations of the Superintendent of Financial Services, Part 200: Virtual Currencies. New York State Department of Financial Services. Retrieved from https://govt.westlaw.com/nycrr/Browse/Home/NewYork/NewYorkCodesRulesandRegulations?guid=I7 444ce80169611e594630000845b8d3e&originationContext=documenttoc&transitionType=Default&contextData=(sc.Default) 3. Spence, M. (1978). Job Market Signaling. Uncertainty in economics, pp. 281-306. Academic Press	Link to abbreviations/authors
Cybernetics	Pentland	Brockman I 194 Cybernetics/Pentland: State-of-the-art research in most engineering disciplines is now framed as feedback systems that are dynamic and drive by energy flows. Even AI is being recast as human/machine “adviser” systems, and the military is beginning large-scale funding in this area—something that should perhaps worry us more than drones and independent humanoid robots. But as science and engineering have adopted a more cybernetics-like stance, it has become clear that even the vision of cybernetics is far too small. It was originally centered on the embeddedness of the individual actor but not on the emergent properties of a network of actors. This is unsurprising, because the mathematics of networks did not exist until recently, so a quantitative science of how networks behave was impossible. We now know that study of the individual does not produce understanding of the system except in certain simple cases. >Ecosystems/Pentland. Pentland, A. “The Human strategy” in: Brockman, John (ed.) 2019. Twenty-Five Ways of Looking at AI. New York: Penguin Press.	Brockman I John Brockman Possible Minds: Twenty-Five Ways of Looking at AI New York 2019
Data	Pentland	Brockman I 199 Data/cybernetics/ecosystem/decision-making processes/Pentland: When you can get (…) feedback quantitatively - which is difficult, because most things aren’t measured quantitatively - both the productivity and the innovation rate within the organization can be significantly improved. A next step is to try to do the same thing but at scale, something I refer to as building a trust network for data. It can be thought of as a distributed system like the Internet, but with the ability to quantitatively measure and communicate the qualities of human society (…) Brockman I 203 If we have the data that go into and out of each decision, we can easily ask, Is this a fair algorithm? Is this AI doing things that we as humans believe are ethical? This human in-the-loop approach is called “open algorithms”; you get to see what the Als take as input and what they decide using that input. If you see those two things, you’ll know whether they’re doing the right thing or the wrong thing. It turns out that’s not hard to do. If you control the data, then you control the AI. >Algorithms, >Artificial intelligence. Pentland, A. “The Human strategy” in: Brockman, John (ed.) 2019. Twenty-Five Ways of Looking at AI. New York: Penguin Press.	Brockman I John Brockman Possible Minds: Twenty-Five Ways of Looking at AI New York 2019
Decision-making Processes	Pentland	Brockman I 198 Decision-making Processes/Pentland: My students and I are looking at how people make decisions, on huge databases of financial decisions, business decisions, and many other sorts of decisions. What we’ve found is that humans often make decisions in a way that mimics AI credit-assignment algorithms and works to make the community smarter. A particularly interesting feature of this work is that it addresses a classic problem in evolution known as the group selection problem. The core of this problem is: How can we select for culture in evolution, when it’s the individuals that reproduce? What you need is something that selects for the best cultures and the best groups but also selects for the best individuals, because they’re the units that transmit the genes. >Ecosystem/Pentland, >Cybernetics/Pentland. “Distributed Thompson sampling”/Pentland: a mathematical algorithm used in choosing, out of a set of possible actions with unknown payoffs, the action that maximizes the expected reward in respect to the actions. The key is social sampling, a way of combining evidence, of exploring and exploiting at the same time. It has the unusual property of simultaneously being the best strategy both for the individual and for the group. Social sampling: (…) is looking around you at the actions of people who are like you, finding what’s popular, and then copying it if it seems like a good idea to you. Idea propagation has this popularity function driving it, but individual adoption also is about figuring out how the idea works for the individual—a reflective attitude. When you combine social sampling and personal judgment, you get superior decision making. That’s amazing, because now we have a mathematical recipe for doing with humans what all those AI techniques are doing with dumb computer neurons. We have a way of putting people together to make better decisions, given more and more experience. (…) the way you can make human AI, will work only if you can get feedback to them that’s truthful. It must be grounded on whether each per son’s actions worked for them or not. Brockman I 199 The next step is to build a credit-assignment function (>Ecosystem/Pentland). Pentland, A. “The Human strategy” in: Brockman, John (ed.) 2019. Twenty-Five Ways of Looking at AI. New York: Penguin Press.	Brockman I John Brockman Possible Minds: Twenty-Five Ways of Looking at AI New York 2019
Ecology	Naess	Singer I 251 Ecology/Naess, Arne/Singer, P.: (A. Naess (1973)⁽¹⁾: Def Shallow Ecology/Naess: is limited to the traditional framework of ethics: this is about not polluting water, for example, in order to have enough drinking water and to avoid pollution, so that one can continue to enjoy nature. On the other hand, Def Deep Ecology/Naess: wants to preserve the biosphere for its own sake, regardless of the potential benefit to mankind. Deep Ecology/Naess/Singer, P.: thus takes as its subject matter larger units than the individual: species, ecosystems and even the biosphere as a whole. Deep Ecology(2): (A. Naess and G. Sessions (1984)⁽²⁾ Principles: 1. The wellbeing and development of human and non-human life on earth have a value in itself (intrinsic, inherent value), regardless of the non-human world's use for human purposes. 2. Wealth and diversity of life forms contribute to the realization of these values and are values in themselves. 3. People do not have the right to diminish the wealth and diversity of the world, except when it comes to vital interests. Singer I 252 Biosphere/Naess/Sessions/Singer, P.: Sessions and Naess use the term "Biosphere" in a broad sense, so that rivers, landscapes and ecosystems are also included. P. SingerVsNaess: (see also SingerVsSessions): the ethics of deep ecology does not provide satisfactory answers to the value of the life of individuals. Maybe that is the wrong question. Ecology is more about systems than individual organisms. Therefore, ecological ethics should be related to species and ecosystems. Singer I 253 So there is a kind of Holism behind it. This is shown by Lawrence Johnson (L. Johnson, A Morally Deep World, Cambridge, 1993). Johnson's thesis: The interests of species are different from the sum of individual interests and exist simultaneously together with individual interests within our moral considerations. >Climate change, >Climate damage, >Energy policy, >Clean Energy Standards, >Climate data, >Climate history, >Climate justice, >Climate periods, >Climate targets, >Climate impact research 1. A. Naess (1973). „The Shallow and the Deep, Long-Range Ecology Movement“, Inquiry 16 , pp. 95-100 2. A. Naess and George Sessions (1984). „Basic Principles of Deep Ecology“, Ecophilosophy, 6	Naess I Arne Naess Can Knowledge Be Reached? Inquiry 1961, S. 219-227 In Wahrheitstheorien, Gunnar Skirbekk Frankfurt/M. 1977 SingerP I Peter Singer Practical Ethics (Third Edition) Cambridge 2011 SingerP II P. Singer The Most Good You Can Do: How Effective Altruism is Changing Ideas About Living Ethically. New Haven 2015
Ecology	Sessions	Singer I 252 Ecology/biosphere/George Sessions/Bill Devall/Singer, P.: W. Devall and G. Sessions, Deep Ecology, Living As If Nature Mattered, Salt Lake City (1985): Thesis: The idea of biocentric equality is that all things in the biosphere have the same right to life and the right to their individual development possibilities. All organisms and entities in the ecosphere, as part of a coherent whole, have the same intrinsic value. P. SingerVsSessions, George/P. SingerVsDevall, Bill/Singer, P.: there are strong intuitive objections, for example: 1. That the welfare of adults is more important than the well-being of yeast and that the rights of gorillas are higher than the rights of grass. 2. If humans, gorillas, yeasts and grasses are all parts of a coherent whole, one can still ask why this gives the same intrinsic value to all elements. a) Even if there is an intrinsic value in the realm of micro-organisms and the plant kingdom, this does not show that individual micro-organisms and individual plants also have an intrinsic value, because their survival as individuals is irrelevant to the survival of the ecosystem as a whole. b) The fact that all organisms are part of a coherent whole does not show that they all have an intrinsic value, let alone the same intrinsic value. It could still be that the whole thing has only one value, because it promotes the existence of conscious beings.	Sessions I George Sessions Deep Ecology - Living as If Nature Mattered Santa Barbara 1987 SingerP I Peter Singer Practical Ethics (Third Edition) Cambridge 2011 SingerP II P. Singer The Most Good You Can Do: How Effective Altruism is Changing Ideas About Living Ethically. New Haven 2015
Ecology	Singer	I 251 Ecology/Aldo Leopold/Singer, P.: (A. Leopold)⁽¹⁾: Thesis: We need a "new ethics" that deals with the relationship of man to land and animals. Leopold thesis: Something is okay if it intends to preserve the integrity, stability and beauty of the biotic community and it is wrong if it does not do so. >Utilitarianism. I 253 Ecology/Deep Ecology/Singer, P.: (see also Ecology/Naess, Ecology/Sessions). Problems: it is the question of whether a species or an ecosystem can be considered as an individual with interests. >Ecosystemic approach. Deep ecology: will have a problem with the definition of reverence for life. One cannot only doubt that trees, species and ecosystems have moral interests: moreover, if they are to be considered as a "self", it is still difficult to show that the survival of this self (the tree or the system) has a moral value, irrespective of the benefit it has for conscious life. Existence/Systems/Value/Ethics/Singer, P.: Another problem: "How is it for a system not to be realized?" I 254 P. SingerVsLovelock, James: In this respect, species, trees and ecosystems are more like rocks than knowing beings. We should confine ourselves to arguments concerning such knowing beings. >Deep ecology. 1. A. Leopold, A Sand County Almanac, with Essay on Conservation from Round River, New York (1970), pp. 238 and 262.	SingerP I Peter Singer Practical Ethics (Third Edition) Cambridge 2011 SingerP II P. Singer The Most Good You Can Do: How Effective Altruism is Changing Ideas About Living Ethically. New Haven 2015
Ecosystemic Approach			Link to abbreviations/authors
Ecosystemic Approach	Bronfenbrenner	Upton I 16 Ecosystemic Approach/Bronfenbrenner/Upton: Bronfenbrenner’s biocological systems theory (Bronfenbrenner 1977)⁽¹⁾ provides us with a framework for looking at the different factors that influence human development. Bronfenbrenner acknowledges the importance of biological factors for development, but also points to the fact that, more than any other species, humans create Upton I 17 the environments that help shape their own development. Development always occurs in a particular social context and this context can change development. Bronfenbrenner maintained that human beings can therefore develop those environments to optimise their genetic potential. >Environment. Aspects of the environment: Microsystem: this includes the immediate environment we live in and any immediate relationships or organisations we interact with, such as the family, school, workplace, peer group and neighbourhood. Mesosystem: this level describes the connections between immediate environments. According to Bronfenbrenner, the way in which the different groups or organisations in the microsystem work together will have an effect on how we develop as individuals. Exosystem: this refers to the external environmental settings that only indirectly affect development, such as a parent’s workplace. Macrosystem: this is the larger cultural context and includes cultural and social norms and attitudes, national economy, political culture and so on. Although this layer is the most remote from the individual, it still influences development, for example by shaping how the micro- and exosystems are organised. >Norms, >Attitudes, >Socialization, >Social identity. Upton I 18 Chronosystem: this system refers to the dimension of time as it relates to an individual’s environments. Elements within this system can be either external, such as the timing of a loved one’s death, or internal, such as the physiological changes that occur with ageing. As individuals get older, they may react differently to environmental changes and may be more able to determine more how those changes will influence them. >Aging. 1. Bronfenbrenner, U. (1977) Toward an experimental ecology of human development. American Psychologist, 32: 513–31.	Upton I Penney Upton Developmental Psychology 2011
Ecosystems	Pentland	Brockman I 195 Ecosystem/Pentland: How can we make a good human-artificial ecosystem, something that’s not a machine society but a cyberculture in which we can all live as humans—a culture with a human feel to it? Brockman I 196 The first thing to ask is: What’s the magic that makes the current AI work? Where is it wrong and where is it right? The good magic is that it has something called the credit-assignment function. What that lets you do is take “stupid neurons”—little linear functions—and figure out, in a big network, which ones are doing the work and strengthen them. The bad part of it is that because those little neurons are stupid, the things they learn don’t generalize very well. If an AI sees something it hasn’t seen before, or if the world changes a little bit, the AI is likely to make a horrible mistake. It has absolutely no sense of context. In some ways, it’s as far from Solution/Pentland: imagine neurons in which real-world knowledge was embedded. When you add (…) background knowledge and surround it with a good credit assignment function, then you can take observational data and use the credit-assignment Brockman I 197 function to reinforce the functions that are producing good answers. The result is an AI that works extremely well and can generalize. Social physics/Pentland: Thesis: Similar to the physical-systems case, if we make neurons that know a lot about how humans learn from one another, then we can detect human fads and predict human behavior trends in surprisingly accurate and efficient ways. This “social physics” works because human behavior is determined as much by the patterns of our culture as by rational, individual thinking. These patterns can be described mathematically and employed to make accurate predictions. >Cybernetics/Pentland, >Decision-making Processes/Pentland, >Data/Pentland. Pentland, A. “The Human strategy” in: Brockman, John (ed.) 2019. Twenty-Five Ways of Looking at AI. New York: Penguin Press.	Brockman I John Brockman Possible Minds: Twenty-Five Ways of Looking at AI New York 2019
Environmental Damage	Economic Theories	Mause I 402f Environmental Damage/Economic Theory: Environmental damage is often the result of the economic use of natural resources. They are caused by production and consumption as well as the absorption of pollutants within the existing environmental media (air, water, soil). These forms of use can also be described as functions of the natural environment (production, consumption, landfill function). On the other hand, increasing land use for settlement, transport and production purposes is contributing to environmental damage because natural ecosystems are being reduced, biodiversity is declining, the landscape is being affected and the soil is increasingly sealed (Cansier 1993, p. 3 ⁽¹⁾; Hartwig 1992, p. 126ff ⁽²⁾). Environmental Policy/Federal Republic of Germany: The environmental policy pursued in Germany for more than 40 years (see for an overview Böcher und Töller 2012, p. 6ff. ⁽³⁾) has contributed to a significant improvement in Germany's environmental quality status, particularly in the recent past, according to the latest OECD environmental assessment report (2012) ⁽⁴⁾. For example, Germany's total greenhouse gas emissions (CO2, methane, etc.) in 2010 were 24 % below 1990 levels, although Germany is one of the few OECD countries to have completely decoupled greenhouse gas emissions and economic growth in the 2000s, not least due to a reduction in the energy intensity of industrial production. Externality: The need for government action in the field of environmental policy can be justified from an economic point of view by the concept of external effects in addition to the public good properties of the elimination of environmental damage (Feess und Seeliger 2013, p. 39ff.⁽⁵⁾; Endres 2000, p. 18ff.⁽⁶⁾). Environmental damage and improvements can then be understood as a consequence of negative or positive side effects of production or consumption. Like public goods, these effects are not covered by the market price mechanism. Problem: If the state does not ensure the "internalisation of external effects" within the framework of its environmental policy, i.e. for the charging of external costs or a renumeration of the external benefits from the polluter, this leads to a misallocation in the provision of private goods, which is accompanied by an overuse of environmental resources or too little improvement in environmental quality.⁽⁷⁾ >Emission permits, >Emission reduction credits, >Emission targets, >Emissions, >Emissions trading, >Climate change, >Climate damage, >Energy policy, >Clean Energy Standards, >Climate data, >Climate history, >Climate justice, >Climate periods, >Climate targets, >Climate impact research, >Carbon price, >Carbon price coordination, >Carbon price strategies, >Carbon tax, >Carbon tax strategies. 1. Cansier, Dieter. 1993. Umweltökonomie. Stuttgart/ Jena: 2. Hartwig, Karl-Hans, Umweltökonomie. In Vahlens Kompendium der Wirtschaftstheorie und Wirtschaftspolitik, ed. Dieter Bender, Hartmut Berg, Dieter Cassel, Günter Gabisch, Karl-Hans Hartwig, Lothar Hübl, Dietmar Kath, Rolf Peffekoven, Jürgen Siebke, H. Jörg Thieme und Manfred Willms, Vol. 2, 5. ed., 122– 162. München 1992 3. Böcher, Michael, und Annette E. Töller, Umweltpolitik in Deutschland. Eine politikfeldanalytische Einführung. Wiesbaden 2012. 4. OECD. 2012. OECD-Umweltprüfberichte. Deutschland 2012. Paris: OECD Publishing. 5. Feess, Eberhard, und Andreas Seeliger, Umweltökonomie und Umweltpolitik, 4. ed. München 2013 6. Endres, Alfred, Umweltökonomie, 3. ed. Stuttgart: 2000. 7. Ibid. p. 19	Mause I Karsten Mause Christian Müller Klaus Schubert, Politik und Wirtschaft: Ein integratives Kompendium Wiesbaden 2018
Extinction	Gould	I 291ff Extinction/Evolution/Life/Gould: extinction is not a domino in a development with great consequences, extinction is what all species have in common. They cannot take all their ecosystems with them even when they die out. Therefore, species do not depend very much on each other. New York, for example, could survive without its dogs. II 339 ff Mistake: it is a mistake to say that "any species that is extinct is extinct because of its overspecialization." This is perhaps the most common misunderstanding about the history of life. It is a wrong understanding of progress and a wrong equation of disappearance and ineptitude. If one imagines life as a continuous and constant struggle, disappearance must be the final sign of inadequacy. >Explanation, >Theories. II 340 GouldVs: but the present life does not even come close to perfection. The allegedly classic case of extinction based on competitive inferiority cannot be maintained. For example, when the Andes rose, there was probably a considerable rain shadow over South America and the tropical forests were transformed into dry areas. II 346 Consolation for believers in progress: in the case of mass extinction, an attempt is made with a definition "background rate". The background rate compares the normal development (normal extinction). Discovery: for more than half a billion years, the background rate has been declining slowly but steadily. During the early Cambrian period, at the beginning of adequate fossil records, about 600 million years ago, the average rate stood at 4.6 extinct species per million years. Since then, the rate has been steadily decreasing to about 2.0. If the Cambrian rate had continued, about 710 more genera would have died out! It is interesting to note that the total number of genera has increased since then by almost the same number (680). II 347 No species is immortal. The inevitable should never be depressing. IV 13 Extinction/Gould: extinction is more than just a negative force. IV 178 Mass extinction/Gould: mass extinction must be reinterpreted from four points of view: 1. Mass extinction is not the peak of a continuum, but fractures. 2. Mass extinctions are much more frequent, faster, deeper and very different (in terms of the number of extinct creatures) than we have ever imagined. IV 179 The end of the Ediacara fauna was the first mass extinction. The fauna has been replaced and not improved or strengthened. IV 182 A periodicity of mass extinction has been discovered: it had been 26 million years since the last great death in the Permian period a climax arose. Common cause explanations: common causes for mass extinctions are: mountain formations, volcanism, temperature fluctuations, ... New: a sinking sea level could be considered and has actually been observed before the last mass extinction. But: most mass extinction is preceded by a slow decline in animal groups! Possible explanation: there are only a few fossils, as fewer rocks are suitable for conservation. IV 185 Evolution/classification: some branches of the evolutionary tree contain many species, others, very few. There are strong differences. During normal times, species-rich branches tend to increase their richness. Question: why do they not conquer the entire biosphere for themselves? Solution: in the event of mass extinction, they have worse chances. IV 201 Extinction: each is inevitable forever. An extinct experiment will never be repeated. The chances are mathematically too slim. Biologists speak of the "principle of the irreversibility of evolution".	Gould I Stephen Jay Gould The Panda’s Thumb. More Reflections in Natural History, New York 1980 German Edition: Der Daumen des Panda Frankfurt 2009 Gould II Stephen Jay Gould Hen’s Teeth and Horse’s Toes. Further Reflections in Natural History, New York 1983 German Edition: Wie das Zebra zu seinen Streifen kommt Frankfurt 1991 Gould III Stephen Jay Gould Full House. The Spread of Excellence from Plato to Darwin, New York 1996 German Edition: Illusion Fortschritt Frankfurt 2004 Gould IV Stephen Jay Gould The Flamingo’s Smile. Reflections in Natural History, New York 1985 German Edition: Das Lächeln des Flamingos Basel 1989
God	Smith	Otteson I 25 God/Adam Smith/Otteson: (…) Smith was apparently a Christian and hence seemed to believe both that God created us and that He intends for us to be happy.* Smith's argument is rather that God created us with the necessary psychological tools - in particular, the desire for mutual sympathy of sentiments - as well as with the necessary circumstances - in particular, scarcity of resources, which requires cooperation to survive and flourish - that would, or at least could, lead us to develop mutually beneficial communities of virtue and prosperity. All of this would proceed cooperatively and jointly, but without requiring divine interposition. But Smith also believed that empirical observation suggests that human beings are imperfect and often make mistakes. Free will/Adam Smith: Their free will enables them to make choices - some of which will turn out to benefit themselves and others, but others of which will turn out to harm themselves or others. The process he envisions, then, is similar to what Darwin would articulate in the succeeding century as that giving rise to species and ecosystems in the natural order.** >Spontaneous order, >Adam Smith Problem, >Rules/Adam Smith. * Modern scholars differ over the extent to which Smith's many references to God, to the Author of Nature, and so on are indicative of his actual religious beliefs. For discussion, see Ross (2010)⁽¹⁾ and, for a variety of perspectives, Oslington (2011)⁽²⁾. ** For a recent discussion of the link between Smith and Darwin, see Ridley (2015)⁽³⁾, especially Chapter 2. 1. Ross, Ian Simpson (2010). The Life of Adam Smith. 2nd edition. Oxford University Press. 2. Oslington, Paul. (2011). The Future Hope in adam Smith’s System. Studies in christian Ethics. Vol. 24, 3. https://doi.org/10.1177/0953946811405 3. Ridley, Matt. (2015). The Evolution of Everything: How Ideas Emerge. Harper Perennial.	EconSmith I Adam Smith The Theory of Moral Sentiments London 2010 EconSmithV I Vernon L. Smith Rationality in Economics: Constructivist and Ecological Forms Cambridge 2009 Otteson I James R. Otteson The Essential Adam Smith Vancouver: Fraser Institute. 2018
Humans	Bostrom	I 110 Humans/intelligence/biology/capacities/Bostrom: The principal reason for humanity’s dominant position on Earth is that our brains have a slightly expanded set of faculties compared with other animals. I 346 In what sense is humanity a dominant species on Earth? Ecologically speaking, humans are the most common large (~50 kg) animal, but the total human dry biomass (~100 billion kg) is not so impressive compared with that of ants, the family Formicidae (300 billion–3,000 billion kg). Humans and human utility organisms form a very small part (<0.001) of total global biomass. However, croplands and pastures are now among the largest ecosystems on the planet, covering about 35% of the ice-free land surface (Foley et al. 2007)⁽¹⁾. And we appropriate nearly a quarter of net primary productivity according to a typical assessment (Haberl et al. 2007)⁽²⁾, though estimates range from 3 to over 50% depending mainly on varying definitions of the relevant terms (Haberl et al. 2013)⁽³⁾. Humans also have the largest geographic coverage of any animal species and top the largest number of different food chains. >Superintelligence/Bostrom. 1. Foley, J. A., Monfreda, C., Ramankutty, N., and Zaks, D. 2007. “Our Share of the Planetary Pie.” Proceedings of the National Academy of Sciences of the United States of America 104 (31): 12585–6. 2. Haberl, H., Erb, K. H., Krausmann, F., Gaube, V., Bondeau, A., Plutzar, C., Gingrich, S., Lucht, W., and Fischer-Kowalski, M. 2007. “Quantifying and Mapping the Human Appropriation of Net Primary Production in Earth’s Terrestrial Ecosystems.” Proceedings of the National Academy of Sciences of the United States of America 104 (31): 12942–7. 3. Haberl, Helmut, Erb, Karl-Heinz, and Krausmann, Fridolin. 2013. “Global Human Appropriation of Net Primary Production (HANPP).” Encyclopedia of Earth, September 3.	Bostrom I Nick Bostrom Superintelligence. Paths, Dangers, Strategies Oxford: Oxford University Press 2017
Information	Kauffman	I 111 Order/Life/Human/Kauffman: the human is the product of two sources of order, not one. >Order/Kauffman, >Life/Kauffman, >Humans. I 112 Information/order/life/emergence/Kauffman: most people assume that DNA and RNA are stable stores of genetic information. However, if life began with collective autocatalysis and later learned to incorporate DNA and genetic code, we must explain how these formations could be subject to hereditary variation and natural selection, even though they did not yet contain a genome! >Genes, >Selection. On the one hand, evolution cannot proceed without matrices copying mechanisms, but on the other hand it is the one that combines the mechanisms. >Evolution. Could an autocatalytic formation evolve without it? Solution: Spatial compartments (spaces divided by membranes) that split are capable of variation and evolution! Solution: Assumption: every now and then random, uncatalysed reactions take place and produce new molecules. The metabolism (conversion, metabolism) would be extended by a reaction loop. Evolution without genome, no DNA-like structure as a carrier of information. >Life/Kauffman. I 114 Catalysis/Autocatalysis/Kauffman: in the case of autocatalytic formations, there is no difference between genotype and phenotype. >Genotype, >Phenotype. Life/emergence/Kauffman: this inevitably leads to the formation of a complex ecosystem. Molecules produced in a primordial cell can be transported into other primordial cells and influence reactions there. Metabolic-based life does not arise as a whole or as a complex structure, but the entire spectrum of mutualism and competition is present from the very beginning. Not only evolution, but also co-evolution. >Co-evolution. I 115 Order/life/emergence/Kauffman: the autocatalytic formations must coordinate the behaviour of several thousand molecules. The potential chaos is beyond imagination. Therefore, another source of molecular order has to be discovered, the fundamental internal homeostasis (balance). Surprisingly simple boundary conditions are sufficient for this. >Beginning I 148 Information/Genes/Kauffman: Question: What mechanism controls the implementation and suppression of certain genetic information? And how do the different cell types know which genes to use and when? J. Monod/Francois Jacob: Mid-1960s: Discovery of an operator that only releases a reaction at a certain point in time. >J. Monod. I 149 Also repressor. A small molecule can "switch on" a gene. I 150 In the simplest case, two genes can suppress each other. Two possible patterns. >Genes. Gene 1 is active and suppresses gene 2 or vice versa. Both cell types would then have the same "genotype", the same genome, but they could realize different gene sets. New horizon of knowledge: unexpected and far-reaching freedom at the molecular level. The addition of the repressor to the operator at different points results in different receptivity to the operator on the DNA. Regulation. I 151 This control mechanism by addition in two different places means complete freedom for the molecules to create genetic circuits of arbitrary logic and complexity. We must first learn to understand such systems.	Kau II Stuart Kauffman At Home in the Universe: The Search for the Laws of Self-Organization and Complexity New York 1995 Kauffman I St. Kauffman At Home in the Universe, New York 1995 German Edition: Der Öltropfen im Wasser. Chaos, Komplexität, Selbstorganisation in Natur und Gesellschaft München 1998
Internet	Zittrain	I 3 Internet/Zittrain: The future unfolding right now is verypast. The future is not one of generative PCs attached to a generative network. It is instead one of sterile appliances tethered to a network of control. I 7 The first part of the book traces the battle between the centralized proprietary networks and the Internet, and a corresponding fight between specialized information appliances like smart typewriters and the general-purpose PC, highlighting the qualities that allowed the Internet and PC to win. I 26 Internet/Zittrain: the Internet’s founding is pegged to a message sent on October 29, 1969. It was transmitted from UCLA to Stanford by computers hooked up to prototype “Interface Message Processors” (IMPs). ⁽¹⁾ A variety of otherwise-incompatible computer systems existed at the time—just as they do now—and the IMP was conceived as a way to connect them. ⁽²⁾ (The UCLA programmers typed “log” to begin logging in to the Stanford computer. The Stanford computer crashed after the second letter, making “Lo” the first Internet message.) From its start, the Internet was oriented differently from the proprietary networks and their ethos of bundling and control. Its goals were in some ways more modest. The point of building the network was not to offer a particular set of information or services like news or weather to customers, for which the network was necessary but incidental. Rather, it was to connect anyone on the network to anyone else. It was up to the people connected to figure out why they wanted to be in touch in the first place; I 69 I have termed this quality of the Internet and of traditional PC architecture “generativity.” Generativity is a system’s capacity to produce unanticipated change through unfiltered contributions from broad and varied audiences. Terms like “openness” and “free” and “commons” evoke elements of it, but they do not fully capture its meaning, and they sometimes obscure it. I 101 In a development reminiscent of the old days of AOL and CompuServe, it is increasingly possible to use a PC as a mere dumb terminal to access Web sites with interactivity but with little room for tinkering. (“Web 2.0” is a new buzzword that celebrates this migration of applications traditionally found on the PC onto the Internet. Confusingly the term also refers to the separate phenomenon of increased user-generated content and indices on the Web—such as relying on user-provided tags to label photographs.) New information appliances that are tethered to their makers, including PCs and Web sites refashioned in this mold, are tempting solutions for frustrated consumers and businesses. None of these solutions, standing alone, is bad, but the aggregate loss will be enormous if their emergence represents a wholesale shift of our information ecosystem away from generativity. ((s) For generativity see Terminology/Zittrain.) 1. See ARPANET—The First Internet, http://livinginternet.com/i/ii_arpanet.htm (last visited June 1, 2007); IMP—Interface Message Processor, http://livinginternet.com/i/ii_imp.htm (last visited June 1, 2007). 2. See IMP—Interface Message Processor, supra note 25.	Zittrain I Jonathan Zittrain The Future of the Internet--And How to Stop It New Haven 2009
Order	Kauffman	Dennett I 306 Self-organization/Kauffman/Dennett: Kauffman's laws are not those of form, but of design, the compulsions of meta technology. >Laws/Kauffman, >Laws, >Laws of nature. Dennett I 308 Self-organization/Kauffman: the ability to evolve, i. e. the ability to search the area of opportunity, is optimal when populations are "melting out" of local regions. >Self-organisation. Local/Global/Self-organization/Technology/Kauffman: Local rules create global order. >Local/global. Dennett: mankind's technology is not governed by this principle. For example, pyramids are organized from top to bottom, but the building activity is of course from bottom to top. >Technology. Until the evolution of rational human technology, the rules run from local to global, then the direction is reversed. --- Kauffman I 9 Order/Human/Kauffman thesis: natural selection has not formed us alone, the original source of order is self-organization. The complex whole can show "emergent" characteristics in a completely unmystic sense, which are legitimate for themselves. >Complexity, >Emergence. Kauffman I 21 The human then no longer appears as a product of random events, but as the result of an inevitable development. >Life, >Humans. Kauffman I 18 Definition Rational Morphologists/Kauffman: (Darwin's predecessor): Thesis: biological species are not the product of random mutation and selection, but of timeless laws of shape formation. (Kauffman goes in a similar direction). Order/Physics/Kauffman: physics knows phenomena of profound spontaneous order, but does not need selection! Cf. >Selection. Kauffman I 30 Self-organization/Kauffman: thesis: certain structures occur at all levels: from ecosystems to economic systems undergoing technological evolution. >Ecosystems, >Economy. Thesis: all complex adaptive systems in the biosphere, from single-celled organisms to economies, strive for a natural state between order and chaos. Great compromise between structure and chance. >Structures, >Random. Kauffman I 38 Order/physics/chemistry/biology: two basic forms: 1. occurs in so-called energy-poor equilibrium systems: For example, a ball rolls into the middle of a bowl. For example, in a suitable aqueous solution, the virus particle composes itself of its molecular DNA (RNA) and protein components, striving for the lowest energy state. 2. type of order: is present when the preservation of the structure requires a constant substance or energy supply. (Dissipative). For example, a whirlpool in the bathtub. For example, the Great Red Spot on Jupiter. It is at least 300 years old, which is longer than the mean residence time of a single gas molecule in the vortex. It is a stable structure of matter and energy through which a constant stream of matter and energy flows. One could call it a living being: it supports itself and gives birth to "baby whirls". >Life/Kauffman. Cells, for example, are not low-energy, but rather complex systems that constantly convert nutrient molecules to maintain their inner structure and multiply. Kauffman I 115 Order/life/emergence/Kauffman: the autocatalytic formations must coordinate the behaviour of several thousand molecules. The potential chaos is beyond imagination. Therefore, another source of molecular order has to be discovered, of the fundamental internal homeostasis (balance). Surprisingly simple boundary conditions are sufficient for this. >Laws/Kauffman.	Kau II Stuart Kauffman At Home in the Universe: The Search for the Laws of Self-Organization and Complexity New York 1995 Kauffman I St. Kauffman At Home in the Universe, New York 1995 German Edition: Der Öltropfen im Wasser. Chaos, Komplexität, Selbstorganisation in Natur und Gesellschaft München 1998 Dennett I D. Dennett Darwin’s Dangerous Idea, New York 1995 German Edition: Darwins gefährliches Erbe Hamburg 1997 Dennett II D. Dennett Kinds of Minds, New York 1996 German Edition: Spielarten des Geistes Gütersloh 1999 Dennett III Daniel Dennett "COG: Steps towards consciousness in robots" In Bewusstein, Thomas Metzinger Paderborn/München/Wien/Zürich 1996 Dennett IV Daniel Dennett "Animal Consciousness. What Matters and Why?", in: D. C. Dennett, Brainchildren. Essays on Designing Minds, Cambridge/MA 1998, pp. 337-350 In Der Geist der Tiere, D Perler/M. Wild Frankfurt/M. 2005
Reanalysis	Climatology	Edwards I 58 Reanalysis/Climatology/Edwards: Analyzed weather data aren’t of much use to climatologists because forecasters frequently revise their analysis models (as often as every six months in some cases). Each change in the analysis model renders the data it produces incommensurable with those produced by the previous model. Reanalysis eliminates this problem by using a single “frozen” model to analyze historical observational data over some long period (40–50 years or even more). Because analysis models are built to combine readings from all available observing systems, reanalysis also overcomes the otherwise thorny problem of comparing instruments such as radiosondes and satellite radiometers. The result is a physically self-consistent global data set for the entire reanalysis period. Potentially, this synthetic data set would be more accurate than any individual observing system.⁽¹⁾ (…) some scientists hope that reanalysis will eventually generate definitive data sets, useable for climate trend analysis, that will be better than raw observational records. For the moment, however, they are stuck with infrastructural inversion - that is, with probing every detail of every record, linking changes in the data record to social and technical changes in the infrastructure that created it, and revising past data to bring them into line with present standards and systems. >Infrastructure/Edwards, >Climate data/Edwards. Edwards I 358 In reanalysis, investigators reprocess decades of original sensor data using a single “frozen” weather analysis and forecasting system. The result is a single complete, uniformly gridded, physically consistent global data set. Reanalysis offered a comprehensive solution to data friction such as that created by heterogeneous data sources, including satellite radiances not easily converted into traditional gridded forms. With reanalysis, many hoped, it would be possible to produce a dynamic data image of the planetary atmosphere over 50 years or more - essentially a moving picture that might reveal more precisely how, where, and how much Earth’s climate had changed. Global reanalysis might produce the most accurate, most complete data sets ever assembled. Yet the majority of gridpoint values in these data sets would be generated by the analysis model, not taken directly from observations. Whether or not it eventually leads to better understanding of climate change—a matter about which, at this writing, scientists still disagree - reanalysis represents a kind of ultimate moment in making data global. >Models/Climatology, >Climate data/Edwards, >Parameterization/metereology, >Homogenization/climatology. Edwards I 447 From the earliest national and global networks through the 1980s, every empirical study of global climate derived from the separate stream of “climate data.” Climatological stations calculated their own averages, maxima, minima, and other figures. Central collectors later inverted the climate data infrastructure, scanning for both isolated and systematic errors and working out ways to adjust for them, seeking to “homogenize” the record. All of these efforts presumed (…) that only traditional “climate data” could form the basis of that record. But as numerical weather prediction skill advanced and computer power grew, a new idea emerged: What about a do-over? What if you could rebuild climate statistics “from scratch,” from daily weather data? And what if you could do this not simply by recalculating individual station averages, but by feeding every available scrap of weather data into a state-of-the-art 4-D assimilation system, as if taking a moving data image with a single camera? The roots of reanalysis lay in the Global Weather Experiment’s parallel data streams. Edwards I 449 Four-dimensional data assimilation: Trenberth argued that the name “four-dimensional data assimilation” misstated the nature of operational analysis, which was actually “three and a half dimensional.” In other words, operational analyses looked backward in time, integrating data from the recent past (up to the observational cutoff), but they did not look forward in time, correcting the analysis with data arriving in the first few hours after the cutoff. But data assimilation systems purpose-built for reanalysis I 450 could potentially offer this capability, leading (in principle) to more accurate, more smoothly varying analyses.⁽²⁾ I 456 Reanalysis provoked enormous excitement. By the early 2000s, other institutions, including the Japan Meteorological Agency, had launched major reanalysis projects, and numerous smaller, experimental projects had been started.⁽³⁾ Investigators at NOAA’s (National Oceanic and Athmospheric Administration) Earth System Research Laboratory used surface pressure data from the pre-radiosonde era to extend reanalysis back to 1908, complementing existing studies to create a full century of reanalysis data, and they have begun to consider reaching even further back, into the late nineteenth century.⁽⁴⁾ By 2007, Edwards I 457 publications concerned with reanalysis for climate studies were appearing at a rate of 250 per year.⁽⁵⁾ Parameterization: All the assimilation models used in reanalysis to date exhibit biases of various kinds, due mainly to imperfect physical parameterizations. >Parameterization/metereology, >Model bias/climatology. Edwards I 459 Reanalysis: How well has reanalysis worked? Reanalyses and traditional climate data agree well—though not perfectly—for variables constrained directly by observations, such as temperature. But derived variables generated mainly by the model still show considerable differences.⁽⁶⁾ For example, reanalysis models do not yet correctly balance precipitation and evaporation over land and oceans, whose total quantity should be conserved.⁽⁷⁾ This affects their calculations of rainfall distribution, a climate variable that is extremely important to human populations and to natural ecosystems. Edwards I 461 Reanalysis offers something that traditional climate data will never achieve: physically consistent data across all climate variables. Traditional climate data are “single variable”: you get a set of averages for temperature, another one for pressure, a third for precipitation, a fourth for sunshine, and so on. Each type of observation is independent of the others, but in the real atmosphere these quantities (and many others) are interdependent. Reanalysis models simulate that interdependence, permitting a large degree of cross-correction, and they generate all variables for every gridpoint. This allows scientists to study structural features of the atmosphere and the circulation not directly measured by instruments. >Human Footprint/climatology. 1. T. R. Karl et al., eds., Temperature Trends in the Lower Atmosphere: Steps for Understanding and Reconciling Differences (US Climate Change Science Program, 2006), 35. 2. Trenberth, K.E. Atmospheric circulation climate changes. Climatic Change 31, 427–453 (1995). https://doi.org/10.1007/BF01095156 3. K. Onogi et al., “JRA-25: Japanese 25-Year Re-Analysis Project—Progress and Status,” Quarterly Journal of the Royal Meteorological Society 131, no. 613 (2005). 22. G. P. Compo et al., “Feasibility of a 100-Year Reanalysis Using Only Surface Pressure Data,” Bulletin of the American Meteorological Society 87, no. 2 (2006): 175–; J. S. Whitaker et al., “Reanalysis without Radiosondes using Ensemble Data Assimilation,” Monthly Weather Review 132, no. 5 (2004): 1190–. 4. R. M. Dole et al., Reanalysis of Historical Climate Data for Key Atmospheric Features: Implications for Attribution of Causes of Observed Change (US Climate Change Science Program, 2008), 10. 5.. L. R. Lait, “Systematic Differences Between Radiosonde Measurements,” Geophysical Research Letters 29, no. 10 (2002): 1382. 6. R. B. Rood, “Reanalysis,” in Data Assimilation for the Earth System, ed. R. Swinbank et al. (Kluwer, 2003). 7. L. Bengtsson et al., “The Need for a Dynamical Climate Reanalysis,” Bulletin of the American Meteorological Society 88, no. 4 (2007): 495–.	Edwards I Paul N. Edwards A Vast Machine: Computer Models, Climate Data, and the Politics of Global Warming Cambridge 2013
Social Cost	Coase	Kiesling I 19 Social cost/Coase/Kiesling: „The question is commonly thought of as one in which A inflicts harm on B and what has to be decided is: how should we restrain A? But this is wrong. We are dealing with a problem of a reciprocal nature. To avoid the harm to B would inflict harm on A. The real question that has to be decided is: should A be allowed to harm B or should B be allowed to harm A? The problem is to avoid the more serious harm.“⁽¹⁾ Example: A town has a river running through it, with a running path and park along the river, a boat launch for kayaking and fishing, a water treatment facility, and a paper mill (see Yandle 1998⁽²⁾). The paper mill produces products and sells them to consumers who value the products. This transaction defines the mutuallybeneficial interaction between parties at the heart of human exchange. The paper firm earns profits from paper sales when its revenues exceed its costs, and paper consumers earn net satisfaction when they derive more benefit from the paper than the cost to them of purchasing it. Both parties weigh benefits and costs in making their choices over resource use. Problem: If we examine the paper mill’s production more closely, though, we see some costs that may not be reflected fully in the accounting costs we typically associate with such a calculation. For example, producing paper generates waste by-products. Competition: The firm competes for consumers’ business, so it has strong incentives to minimize costs. Disposing of waste is costly, so the paper firm has an incentive to discharge its waste into the river if it can do so at no cost. That waste depletes oxygen in the water and is unattractive, so the company’s “free” waste disposal may create costs that other river users have to bear. Kiesling I 20 But because the paper firm does not pay for disposing of its waste in the river, neither the producer nor the consumer of paper, the two parties to the market transaction, bear that cost. Cost: Instead, the cost shows up in diminished enjoyment of the riverside park, less pleasant kayaking and reduced fishing, a lower quality ecosystem due to depleted oxygen, and additional costs of treatment for water consumption. Coase: Coase called this problem “the problem of social cost” and wrote an article of the same name on the topic in 1960⁽¹⁾. >Externalities/Pigou. Pigou’s analysis⁽³⁾ implied a specific policy recommendation, specifically, a tax on paper to reflect the per-unit cost of the discharge into the river, or a regulation on the paper mill to induce it to incorporate the cost of its discharge into its accounting. Kiesling I 21 This logic has come to be known as “polluter pays,” or that a party that creates a cost should be the one to bear it. A. Solution/CoaseVsPigou: Coase looked at such problems differently, asking instead what the leastcost way of dealing with this problem was, assessing it as a problem of a conflicting use of a resource. This way of thinking about the problem identifies its property rights origins. While Pigou implicitly assumed that the “non-polluter” party has the right to be free from this harm, Coase instead acknowledged that in such cases the property rights definition is not necessarily clear, and that transaction costs limit the ability to define and enforce property rights. >Property rights/Coase. B. Problem/CoaseVsPigou: A related difference in Coase’s approach to the problem of social cost is to see the external cost problem as a reciprocal problem. Pigou: In Pigou’s analysis, the paper mill creates the waste discharge, the confectioner creates noise, and those actions impose costs on others. CoaseVsPigou: Coase argued that this framing of the problem is incomplete, because it misses the fact that the parties impose costs on each other precisely because they have different uses of the shared resource when property rights are not sufficiently well-defined. The paper mill wants to use the river to discharge waste, while the water treatment plant wants clean water to process for consumption, and the kayaker wants an attractive and clean river for recreation. At its core the problem of social cost is a dispute over property rights: “For Coase, natural resource and environmental protection problems typically arise when there is a need to balance these conflicting interests. Compensation: Whether an actor or group of actors is the ‘victim’ or ‘perpetrator’ of an ‘externality’ is fundamentally a question of who has the rights to engage in the activity concerned and if they wish to trade such rights for compensation” (Pennington 2015⁽⁴⁾: 95). Coordination/cooperation: Coordination is difficult, and valuable resources become dissipated, because ownership is undefined. Collective goods: With there being no owner of the river (or the water that flows through it), the pollutant-emitting mill does not pay for the costs it imposes. Barggaining: Hence, bargaining over resource use, where the highest bid for the resource is identified, does not occur. The harmful effects from paper production may destroy clean water - even if clean water has a much greater social value. Kiesling I 22 Innovation/CoaseVsPigou: Coase argued that bargaining is a process that enables parties to learn and discover and to create through innovation lower-cost ways of mitigating such costs. In contrast, the Pigouvian approach presumes that the regulator knows the relevant costs and benefits well enough to determine the exact tax to impose to elicit the exactly optimal amount of paper production. PigouVsPigou: That presumption is unrealistic, as Pigou came to acknowledge later in his life. Cooperation/payments: After figuring out the best way to deal with the harm, the next logical question is, who pays for the filter—the water treatment facility or the paper mill? Where the law establishes property rights, it will be clear. If the mill has the right to pollute, the water treatment plant will pay. If the water treatment plant owns the water, the mill pays. Both parties have incentives to cooperate in enacting this solution if the cost of stopping the pollution is less than the value gained by allowing it to continue. Benefit: Crucially, this is also the requirement for societal gains–that the benefits exceed the costs. Special cases: Coase noted that such straightforward solutions might not unfold in cases where decision-making is decentralized, i.e., where property rights are not defined or in instances where transaction costs have kept the parties from making efficient bargains. In those instances, Pigouvian policies, such as a regulation mandating that paper mills install filters, might prove superior. But neither the market negotiation nor the regulatory approach is free. The two approaches should be compared and contrasted for their ability to foster social coordination, maximizing the value of the resources involved. >Property rights/Coase, >Transaction costs/Coase. Kiesling I 23 Transaction cost/externalities/Coase/Pigou/Kiesling: (…) when defining property rights is prohibitively costly or not feasible (as in, say, air pollution), bargaining to negotiate transfers of rights cannot happen. Property rights definition and enforcement costs are a category of transaction costs. Low transaction cost: Situations with low transaction costs are more likely to see welfare-enhancing bargaining, while … High transaction cost: …high transaction costs can prevent such conflict resolution. Example: An example of Pigou’s that Coase discusses for other reasons illustrates the challenge of transaction costs: the operation of a railroad through rural land in the 19th century. Railroad companies purchased land and built rail networks to run trains pulled by coal-fired steam locomotives, which threw off sparks that could cause fires that destroyed some adjoining crops or woodlands. In a situation such as the transcontinental railroad in the United States, the railroad company operated over thousands of miles and could potentially emit sparks on land owned by thousands of different farmers. This situation and others like it present a considerable transaction cost challenge, one that is common in many situations where there is a conflict in resource uses. Bargaining: In order for the farmers to bargain with the railroad over the rights to emit sparks and the rights to unharmed crops enough farmers would have to gather together to represent the interests of all affected farmers - in other words, the transaction costs would be high. In situations like these, the courts determine which party has legal liability for harms created, and enforce compensation if necessary. Pervasiveness: An overarching theme of Coase’s work on social cost is that transaction costs are pervasive. Because of that pervasiveness courts are important institutions whose decisions have implications for both the efficiency of outcomes and the distribution of profits across parties. >Law/Coase. 1. Coase, Ronald H. (1960). The Problem of Social Cost. Journal of Law and Economics 3: 1-44. 2. Yandle, Bruce (1998). Coase, Pigou, and Environmental Rights. In Peter J. Hill and Roger E. Meiners (eds.), Who Owns the Environment? (Rowman & Littlefield). 3. Pigou, Arthur Cecil (1920/2013). The Economics of Welfare. Palgrave Macmillan. 4. Pennington, Mark (2015). Coase on Property Rights and the Political Economy of Environmental Protection. In Cento G. Veljanovski (ed.), Forever Contemporary: The Economics of Ronald Coase. Institute of Economic Affairs.	Kiesling I L. Lynne Kiesling The Essential Ronald Coase Vancouver: Fraser Institute. 2021
Spontaneous Order	Economic Theories	Otteson I 24 Spontaneous Order/economic theories/Otteson: The explanation [Adam] Smith offers for the development of moral standards holds the process to create what we today might call "spontaneous order." A spontaneous order is a system that arises, as Smith's contemporary Adam Ferguson put it, as "the result ofhuman action, but not the execution of any human design" (Ferguson, 1996⁽³⁾ [1767]: 119). As this theory was developed by twentieth-century thinkers like Michael Polanyi and Friedrich Hayek, it referred to the development of an orderly system that arose from the decentralized actions of individuals but without their intending to design any overall system. Language is a good example. The English language is a relatively orderly system: it contains rules of grammar, definitions of words, and accepted or acceptable pronunciations, but there was no single person or group of persons who invented or designed it. It lives and changes according to the purposes and desires of the users of the language, and its rules are generated and enforced by the users themselves. Another prime example of spontaneous order is ecosystems. Many have concluded from observations like these that the world must therefore have had some intelligent designer (…). Otteson I 25 Adam Smith: One more example of spontaneous order: an economic market. As Smith would go on to describe in his Wealth of Nations⁽¹⁾, the individual actors in economic markets certainly have intentions - they all want, in his words, to "better their own condition" (WN⁽¹⁾ 345) - but they nevertheless typically do not have any larger intentions in mind regarding an overall system of market order. They just want to achieve their localized purposes in cooperation With other willing individuals. Yet individuals' decentralized attempts to achieve their purposes lead to the development of patterns and even principles of behavior that can look as if some wise person designed it all. >Rules/Adam Smith. 1. Ferguson, Adam (1996) [1767]. An Essay on the History of Civil Society. Edited by Fania Oz-Salzberger. Cambridge University Press. 2. Smith, Adam. (1776) The Wealth of Nations. London: W. Strahan and T. Cadell.	Otteson I James R. Otteson The Essential Adam Smith Vancouver: Fraser Institute. 2018
Wash Trade	NBER Working Papers	NBER I 6 Wash Trade/NBER/Cong/Li/Tang/Yang: Most of the academic literature on wash trading in traditional markets focuses on investor behavior (e.g., Grinblatt and Keloharju, 2004)⁽¹⁾. We are the first* to establish wash trading at the exchange level in the new crypto markets. More broadly, our study belongs to the literature on manipulation and misreporting in finance. >Crypto wash trading, >Crypto transactions, >Regulated crypto exchanges. Cryptocurrency: Concerning cryptocurrency markets, Foley, Karlsen, and Putninš (2019)⁽²⁾ study the illegal usage of cryptocurrencies; Gandal, Hamrick, Moore, and Oberman (2018)⁽³⁾ and Griffin and Shams (2020)⁽⁴⁾ discuss manipulative behavior in Bitcoin and Tether; Li, Shin, and Wang (2020)⁽⁵⁾, among others, document pumpand-dump patterns in various cryptocurrencies; most recently, Choi and Jarrow (2020)⁽⁶⁾ discuss crypto bubbles caused by speculation or manipulation. These studies do not examine wash trading, which our unique and comprehensive data set allows us to do using robust yet straightforward procedures. >Cryptocurrency. * Lin William Cong, Xi Li, Ke Tang, and Yang Yang. (2022). Crypto Wash Trading. NBER Working Paper No. 30783. Cambridge, MA. ** Our paper therefore adds to forensic finance and accounting—the use of economic and financial knowledge to discover or substantiate evidence of criminal wrongdoing that meets standards in a court of law (e.g., Allen and Gale, 1992⁽⁷⁾; Jarrow, 1992⁽⁸⁾; Christie and Schultz, 1994⁽⁹⁾; Ritter, 2008⁽¹⁰⁾; Zitzewitz 2012)⁽¹¹⁾. 1. Grinblatt, M. and Keloharju, M. (2004). Tax-loss trading and wash sales. Journal of Financial Economics, 71(1), 51-76 2. Foley, S., Karlsen, J. R., and Putniņš, T. J. (2019). Sex, drugs, and bitcoin: How much illegal activity is financed through cryptocurrencies? The Review of Financial Studies, 32(5), 1798-1853. 3. Gandal, N., Hamrick, J., Moore, T., and Oberman, T. (2018). Price manipulation in the Bitcoin ecosystem. Journal of Monetary Economics, 95, 86-96. 4. Griffin, J. M., and Shams, A. (2020). Is Bitcoin really untethered? The Journal of Finance, 75(4), 1913-1964. 5. Li, T., Shin, D., and Wang, B. (2020). Cryptocurrency pump-and-dump schemes. Available at SSRN 3267041. 6. Choi, S.H., and Jarrow, B. Testing the Local Martingale Theory of Bubbles using Cryptocurrencies, Working paper. 7. Allen, F., and Gale, D. (1992). Stock-price manipulation. The Review of Financial Studies, 5(3), 503-529. 8. Jarrow, R. A. (1992). Market manipulation, bubbles, corners, and short squeezes. Journal of financial and Quantitative Analysis, 27(3), 311-336. 9. Christie, W. G., and Schultz, P. H. (1994). Why do NASDAQ market makers avoid odd‐eighth quotes? The Journal of Finance, 49(5), 1813-1840. 10. Ritter, J. R. (2008). Forensic finance. Journal of Economic Perspectives, 22(3), 127-147. 11. Zitzewitz, E. (2012). Forensic economics. Journal of Economic Literature, 50(3), 731-769.	Link to abbreviations/authors

The author or concept searched is found in the following controversies.

Disputed term/author/ism	Author Vs Author	Entry	Reference
Chomsky, N.	Pinker Vs Chomsky, N.	Dennett I 545/546 Steven PinkerVsChomsky: specialization to the grammar is a conventional neo-Darwinist process. The majority of the most interesting properties of the "language organ" must have evolved through adaptation. Pinker: the objections to this position are mostly ridiculous - e.g. the structure of the cell should be "purely physical" and explained without evolution - e.g. language were not designed to communicate, etc. Pinker I 218 Design/Chomsky: It is wrong to make selection responsible for all design: E.g. the fact that I have a positive mass prevents me from eloping into outer space, but has nothing to do with selection. Simple physical explanation. Explanation/Selection/PinkerVsChomsky: you usually do not refer to selection to explain utility, but to explain something improbable. E.g. eye. If we calculate the parts of the universe with a positive mass and those equipped with an eye, we need an explanation for this difference. Vs: one might reply: the criterion: seeing/not-seeing was only introduced in retrospect, after we knew what animals are capable of. I 219 Most clusters of matter cannot see, but most cannot "fle" either, and I define that now as the composition, size and shape of the stone, on which I'm sitting now. Def Design/Pinker: If the function cannot be described more economically than the structure, no design is present. The concept of function adds nothing new. Design/Pinker: should not serve the harmony of the ecosystem or the beauty of nature. After all, the replicator must be the beneficiary.	Pi I St. Pinker How the Mind Works, New York 1997 German Edition: Wie das Denken im Kopf entsteht München 1998 Dennett I D. Dennett Darwin’s Dangerous Idea, New York 1995 German Edition: Darwins gefährliches Erbe Hamburg 1997 Dennett II D. Dennett Kinds of Minds, New York 1996 German Edition: Spielarten des Geistes Gütersloh 1999 Dennett III Daniel Dennett "COG: Steps towards consciousness in robots" In Bewusstein, Thomas Metzinger Paderborn/München/Wien/Zürich 1996 Dennett IV Daniel Dennett "Animal Consciousness. What Matters and Why?", in: D. C. Dennett, Brainchildren. Essays on Designing Minds, Cambridge/MA 1998, pp. 337-350 In Der Geist der Tiere, D Perler/M. Wild Frankfurt/M. 2005

The author or concept searched is found in the following 2 theses of the more related field of specialization.

Disputed term/author/ism	Author	Entry	Reference
Self-Organization	Kauffman, St.	Dennett I 303 Self-Organization/Kauffman/Dennett: Thesis: Evolution itself undergoes evolution. It develops because it is a forced move in the design game. Finding the right path is surprisingly easy - laws of design, not of form - inevitabilities of metatechnics - epistasis: interaction between genes: - aptitude landscape strongly determines development: successful results are sacrificed. Kauffman I 30 Kauffman's thesis: If the band of life were played again, the individual branches of the family tree of life might look different, but the patterns of branches, which initially diverge strongly and then become more and more a refining of details, probably follow a deeper regularity. Self-Organization/Kauffman: Thesis: these structures occur at all levels: from ecosystems to economic systems undergoing technological evolution. Thesis: All complex adaptive systems in the biosphere - from protozoa to economies - strive for a natural state between order and chaos. Great compromise between structure and chance. I 49 Thesis: The best compromises are apparently achieved in the phase transition between order and chaos. I 51 Chaos Edge/Kauffman: great similarity with the theory of "self-organized criticality": thesis: Per Bak, Chao Tang, Kurt Wiesenfeld. I 349 Self-Organization/Kauffman: Bak, Chao, Wiesenfeld, 1988: new theory: thesis: self-organized criticality. For example, a heap of sand on a table that is constantly getting bigger. I 350 Potency Law/Kauffman: many small and little large avalanches. For avalanches there is no typical size at all! It is also independent of the size of the triggering grain of sand. Catastrophe/Chaos/Kauffman: Equilibrium systems do not need massive triggers to start moving massively. I 366 Economy/Organization/Self-Organization/Kauffman: new researches (Emily Dickinson): Thesis: flatter organizations are more successful, split into fields, each striving to improve their own benefit. The trick is how to select the fields. (NK model). Fields can detect peaks. "Simulated annealing": Finding a good approximation method. ("Temperature" see below) I 415 Thesis: we can consider goods and services as strings that interact with other strings.	Dennett I D. Dennett Darwin’s Dangerous Idea, New York 1995 German Edition: Darwins gefährliches Erbe Hamburg 1997 Kau II Stuart Kauffman At Home in the Universe: The Search for the Laws of Self-Organization and Complexity New York 1995 Kauffman I St. Kauffman At Home in the Universe, New York 1995 German Edition: Der Öltropfen im Wasser. Chaos, Komplexität, Selbstorganisation in Natur und Gesellschaft München 1998
Ecology	Pinker, St.	I 491 Tradition: Thesis: Animals acted for the benefit of the ecosystem, the population or the species. Seems to follow from Darwin. Widely used. PinkerVs: that radically contradicts Darwinism and is also probably wrong.	Link to abbreviations/authors