I just received news of a Kickstarter campaign to fund The Silent Night of the Living Dead Nativity Scene, which features Mary and Joseph protecting the baby Jesus from zombie wise men.  What makes this Christmas prop especially interesting is that it reminds us of the disturbing fact that one of the world’s major religions is premised on the worship of an undead being.

Think about it:  Jesus was a human being who died and then rose from the dead in an altered (spirit) form.  No offense intended to Christians, but that is pretty much a textbook definition of “undead” — which, as any D&D player knows, encompasses not just vampires and zombies (the primary focus of Economics of the Undead) but also ghosts, spirits, liches, revenants, wraiths, and a host of other creatures both corporeal and incorporeal.  The same D&D expert might also wonder whether Jesus’ undead status means that a high-level cleric (perhaps one of evil alignment) could turn him.  (For the non-RPG players out there, “turning” basically means scaring away an undead creature by religious means.)

Jesus might also qualify as the first undead economist, inasmuch as he preached an economic philosophy of love and sharing — specifically, that his followers should sell all their possessions and then give away the money.  That philosophy was heavily criticized by economist Frank Knight, who argued that Jesus’ gospel was essentially an “interim” set of rules meant to govern behavior for a very short time.  The early Christians (at least some of them) believed that the Kingdom of God was literally nigh, meaning that any day now (circa 1 A.D.) the Rapture would occur and all scarcity would disappear, at least for the faithful.  Thus, there was no danger in sharing, overusing, and running down supplies of scarce resources.  But now we know that the Rapture wasn’t coming for at least a couple of thousand years and possibly more.  Given that we could be waiting indefinitely, a different set of temporal rules might be appropriate for governing economic life in the meantime.  For a summary of Knight’s work in this area, see Frank Knight and the Chicago School in American Economics (some of which you can read online in this Google books version; see p. 162).

Economists aren’t the only ones taking a scholarly approach to the undead…

1.  Williams College math professor Colin Adams brings us Zombies and Calculus, a book that uses a fictional narrative about a zombie invasion to explain the principles of calculus.

2.  UCSD neuroscientist Bradley Voytek will soon publish Do Zombies Dream of Undead Sheep?: A Neuroscientific View of the Zombie Brain, which uses zombies to help understand the functioning of (presumably functional) human brains.

3.  This one preceded our book by several years, but we would be remiss if we failed to mention Tufts international relations professor Dan Drezner’s Theories of International Politics and Zombies (which has just been re-released in its “Revived Edition”).  Dan kindly wrote a back-cover endorsement for Economics of the Undead, which means his judgment can be trusted.

In our ongoing effort to publicize job opportunities for the undead, we bring you this:  the Zombie Burlesque Show at Planet Hollywood in Las Vegas.

For more on zombies and vampires in the job market, see Deyo and Mitchell’s “Trading with the Undead: A Study in Specialization and Comparative Advantage,” Chapter 11 in Economics of the Undead.

Guest Post by Enrique Guerra-Pujol

In Chapter 12 (“Buy or Bite?”) of The Economics of the Undead, I observed how most members of the vampire race resort to coercion, compulsion, and confiscation to procure fresh supplies of blood — an essential staple of the vampire diet — and I posed the following fundamental question: “Are vampires ‘bad’? Are they inherently evil or unethical creatures?”

My main argument in “Buy or Bite?” is that vampires are not necessarily bad, that without a legal market for the purchase and sale of blood, vampires have no other choice but to steal their supplies of blood through fraud and force. I thus proposed the creation of legalized “blood markets” to allow us humans to transfer our property rights in our blood to vampires on a consensual and contractual basis.

The domain of my argument, however, was limited to the fictional world of vampires, the world of film, literature, and the arts generally. But now new research by scientists at Stanford and Harvard universities has found that blood from young mice can significantly improve the learning and memory of old mice. Assuming these exciting research findings hold true for humans, my argument for the legalization of the purchase and sale of blood becomes more salient than ever.

For as Jess Zimmerman asks in this fascinating post titled “Young Blood,” “what’s to stop old people from stealing [blood] from the young?” This is a question that has haunted us since the monstrous myth of the blood-thirsty Hungarian countess Lady Elizabeth Báthory, who lived in the 17^th century and who was alleged to have killed hundreds of her young peasant servants and taken daily baths in their blood in order to keep herself from growing old.

But with a legal market for the regular purchase and sale of blood, we need not fear the specter of the old stealing blood from the young. Why not? Because as I explain in “Buy or Bite?,” legal markets convert mutual conflict into joint cooperation since both sides to a transaction benefit from voluntary trade. By way of example, given the potential human applications of the scientific discoveries described above, both old and young could reap enormous benefits from trade in blood.

Consider first the demand side of this potential market — old people who might want to purchase the blood of young adults for this blood’s possible youth-conferring and curative powers. Obviously, if the promising results of the mice-blood experiments were to apply to humans, old people would be better off if they could procure supplies of young blood in order to stave off dementia and live longer and healthier lives.

Now let’s consider the supply side. If you are old enough to vote, join the Army, or drink, why can’t you also be free to choose to sell your own blood? With a legal blood market, young adults would now have a new form of renewable “human capital” at their disposal, and to the extent young people tend to be poorer than older people, many of them could put the potential income generated from the voluntary sale of their blood to good use.

Of course, many people may find the possibility of blood sales morally repugnant. But even if you include yourself among this group of anti-market moralizers, you should keep in mind that markets are always voluntary. That is, when markets are legal, nobody is forced to sell their blood if they don’t want to. But when markets are illegal or legally unclear (as is the case with blood sales today), everyone is prevented from realizing mutually beneficial transactions.

In short, with legalized markets in blood both young and old could benefit from a medical advance that seemingly benefits only the old. The old and the young — as well as vampires and humans for that matter — would have incentives to engage in mutually beneficial trade. Imagine the possibilities!

I’m sure it must have happened before, but today is the first time I’ve ever read a po-mo lit-crit review of a video game.  In the Paris Review, Michael Thomsen offers an extended critique of the PlayStation zombie apocalypse game The Last of Us.  Thomsen’s criticisms are various and sometimes incoherent, but these two passages capture one major thread:

The apocalypse doesn’t mean the end of the world, just the end of humankind, and considering such a fate can lead us into a sentimental peace with the present day. Suddenly, in spite of all its flaws — flaws that might be harder to accept in less dire circumstances — the world seems worth keeping intact. …

The underlying expectation here — that without Western civilization humans would become monsters — is a psychic tic of game designers, who tend to be overeducated upper-middle-class men whose primary lens for understanding the world comes from commercial entertainment. If your worldview is built around a series of compromises you’ve made to secure a comfortable salary building eidolons of human narcissism into restricted-admission dream-states, paranoia and projected self-loathing are in order. And when these labors make you servant to an economy of Moore’s Law and inescapable obsolescence, the competition for scarce resources (conveniently abstracted in the game with overlaid icons, as if Google Glass were the only thing to survive the collapse of human civilization) must seem like an especially poetic prism.

I actually think Thomsen’s position here is correct — but where he sees a bug, I see a feature.  What stories of the zombie apocalypse (and other post-apocalyptic stories like Y the Last Man and Revolution) do best is throw our current prosperity into sharp relief — and make us ask what that prosperity depends upon.

This is a theme that appears repeatedly in Economics of the Undead, particularly in Chapters 3 and 5.  Why should the zombie apocalypse cause such a drastic collapse of living standards?  In short, the answer is that the modern world economy relies on a vast (and vastly complex) web of social cooperation, and that web is built on specialization and division of labor.  We consume goods and services assembled using resources (including labor) from around the world.  This happens for the most part without central planning, and without most people knowing more than just a handful of the millions of people they’re cooperating with.

The zombie apocalypse plays havoc with that web of social cooperation, in a couple of different ways.  First, the zombies kill off (or convert) large numbers of people who fill key positions in the division of labor.  I’m not just talking about medical doctors and nuclear engineers; I’m talking about truck drivers, crane operators, operations managers, and thousands of other people whose small individual contributions add up to massively complex chains of production and trade.  The system has enough redundancy to be able to tolerate occasional losses; after all, people do retire and change jobs from time to time.  But when it happens all at once, as in most apocalyptic narratives, the system collapses.

Second, the zombies massively increase transaction costs — that is, the costs involved in making exchanges occur.  We are accustomed to a world in which transaction costs are typically low; we can communicate with others and make deals without much difficulty.  A phone call or coffee-shop meeting is often enough.  Negotiations over terms of complex transactions may take longer to conclude, but they still usually don’t involve any threat to life and limb.  But when the phone lines are down, the police have disbanded, and zombies roam the landscape, it becomes much harder to find people to deal with, to hammer out the deals, to actually hand over the goods or provide the services in question, and to punish the cheaters and bandits.  That means survivors have to do a lot more for themselves, and what trading they do will tend to be restricted to small communities instead of the whole wide world.  The result?  A dramatically, painfully lower standard of living.

All things considered, then, the prospect of a zombie apocalypse does make the modern world seem worth keeping intact… if we can.

Kevin Ranson, author of Matriarch: The Guardians, describes a vampire-hunting weapon unique to his fictional universe:  the Decapitator.

There were three items inside [the case]:  a three-foot metal bar that ran the length of the case, a wooden stake with a metal tip and a concave clip-point blade sharpened on the inside of the curve.  The attachments had been balanced to compliment one another when assembled into a five-foot long weapon, a blade on one end of the bar and a stake on the other.

Seems like a pretty good weapon to me – decapitate with one end, stab with the other – but I wonder why it’s named after only one of its ends; seems like Double-Header or Amphisbaena would have been more apropos.

Also, it’s worth noting that double-ended vampire-hunting weapons are not unprecedented, as a weapon based on the same principle appeared in Buffy the Vampire Slayer.  It was called the Scythe, and it looked like this:

In any case, a weapon like this would require some high-level armorer skills.  And where can you find a good armorer these days?  The Renaissance Faire?  Assuming you found one, it would have to be a custom job, probably costing a hefty chunk of change.  No wonder, then, that so many vampire slayers (like Buffy and the short-lived Kendra) make their own stakes.

The problem, obviously, is that there are too few vampire slayers to achieve economies of scale in the manufacture of vampire-hunting weaponry.  If only more people were aware of the vampire threat, there would be sufficient demand to permit the use of mass-production techniques — thus lowering the cost-per-weapon relative to artisanal armorers.

Once we have functioning markets in vampire-hunting weapons, there’s a question as to whether those markets will be efficient.  That question is addressed in-depth in Charlotte Weil and Sebastien Lecou’s chapter in Economics of the Undead, “To Shoot or to Stake, That Is the Question.”  But their analysis is limited to stakes vs. firearms and silver vs. wood.  The market for double-headed polearms will have to wait for Volume 2.

This fascinating article in Scientific American on how immortality would affect memory would fit better in a book called Neuroscience of the Undead than Economics of the Undead.  But there is a connection!

As the article observes, episodic memory, i.e., memory of autobiographical events, decays at an exponential rate over time.  That means vampires will likely have a very poor memory of events that happened to them centuries ago, with the exception of key formative events from early in their lives (probably when they were still human).  But non-episodic memory, defined as the memory of “skills, habits and expertise,” does not decay in this way.  And that means vampires are in a position to acquire a large number of skills over their long lives:  “For vampires, there is no theoretical limit on the number of skills that could be acquired to a reasonable level of competence, aside from pastimes that require being outdoors in the daylight or the use of a mirror.”

From an economic perspective, the question is what incentives vampires have to invest in human capital — which may require a different name if non-humans may acquire it.  It is sometimes supposed that immortals might become lazy because they lack the spur of impending death to motivate doing things.  I think that is possible.  But the fact that non-episodic memory doesn’t decay (much) creates an offsetting incentive for immortals to be less lazy.  The longer you stand to benefit from learning something, the greater is your incentive to learn it.  That’s why it makes sense for young people to attend college, but less sense for senior citizens and the terminally ill.  The vampire, looking forward to a potential endless stream of returns from new learning, has a stronger incentive than the typical human to take piano lessons, acquire a new language, master a martial art, and so forth.

However, even if the stream of benefits from a new skill is infinite, the value of that stream is not.  While vampires might discount the future less than humans (a subject discussed in Fabien Medvecky’s chapter in Economics of the Undead), they would probably still discount to some degree.  Consequently, the perceived benefits of skills in the future — much like episodic memories of the past — diminish with distance from the present.  The expected present value of the stream of benefits from a new skill would therefore be finite (see here for the math).  Thus, while vampires would have a greater incentives than humans to acquire new skills, the incentives would not be infinitely great.

What economics course should you take to maximize your odds of surviving the zombie apocalypse?  One blogger suggests the answer is… home economics.

When I was in middle school, I took Home Economics (lovingly abbreviated to Home Ec).  I learned how to cook, balance a budget, sew, and… for some unknown reason… create a blueprint for a house.  Maybe this skill was helpful for Pa Ingalls to know when it was time to make his little house on the prairie, but as someone who planned to move into houses that other people had already constructed, this skill seemed like the least helpful unit.

… If the zombies came, I was going to be prepared.  I would be able to cook a meal, sew my own clothes, balance our weapons budget, AND draw up a quick blueprint of a house so we could visualize our escape plan.

In case you’re wondering, Home Ec is not a course offered by your typical college economics department.  But is the author right?  Are these the skills you would need to survive?

I suspect not.  In the early stages of the zombie apocalypse, there won’t be a lot of building and sewing and budgeting going on.  Mostly, it’ll be running and screaming and hopefully some ass-kicking.  Sure, you might need those cooking skills, but then again, how much skill does it take to heat up a can of beans you scavenged?

In the long run, some Home Ec skills might indeed be useful.  But in the long run, you’re also likely to be living with a group of other survivors in a community of some kind.  At that point, when it’s less about sheer survival and more about rebuilding civilization, the best strategy for achieving prosperity probably isn’t to be the human Swiss Army knife of homemaking skills.  It’s better to have a relatively small set of in-demand skills that you can specialize in, thereby giving you something you can trade for whatever else you need (a point emphasized in Chapters 3 and 5 of Economics of the Undead).

That said, there is likely to be a transition period between the very short-run (every man for himself) and the very long-run (return to advanced civilization).  During this period, while society will likely experience an increasing level of specialization, there will nevertheless be much less specialization than we’re accustomed to — which means you’ll have to do a lot more things for yourself.  It could be years before your community has a division of labor extensive enough to support, say, a dedicated tailor or hairdresser.  So while Home Ec probably isn’t necessary for either short-term survival or long-run prosperity, it might make life easier during that awkward in-between stage.

Some would call this story from the mid-19th century a tragedy. Here at Economics of the Undead, we call it proof of the value of investing in vampire containment facilities:

As the story goes, the Legares took their daughter’s body to the family crypt, remarking at how peaceful she looked, almost as if she was sleeping. Julia’s father laid her on the stone slab inside, and when they had said their goodbyes, the family closed the heavy doors, sealing the crypt’s keyhole with wax.

Years later, Julia’s older brother was killed during the Civil War, and for the first time since Julia passed, the Legare family gathered again at the family crypt. As they turned the key and pulled open the heavy door, the entire family was horrified as Julia’s bones came tumbling out of the opening, her leathery skin still hanging from her gaping jaw. Claw marks covered both the door and the floor of the mausoleum and the bones of Julia’s fingertips were shattered, signs that pointed a frantic attempt to open the sealed door. Julia had not been dead, but merely in a coma.

A “coma”?  That’s a fine story for public consumption.  But would a normal human, recovering from illness no less, be capable of leaving claw marks in the door and (presumably stone) floor?

An alternative account might stress this family’s foresight in having realized their daughter might be in the process in undead conversion.  They smartly decided to contain her body in a stone facility from which even a vampire could not escape.  Of course, they could have just dismembered or cremated her body, but perhaps that seemed too gruesome or disrespectful.

For more on how people might invest in the containment of family members expected to undergo a conversion to undead status, take a look at Eleanor Brown and Robert Prag’s chapter in Economics of the Undead, “Zombification Insurance” (excerpted here).  By the way, this story is brought to us by Roadtrippers, which informs us that you can visit the tomb/containment facility in the present day.

This article on Haitian zombies, which includes a history of attempts to explain their existence in scientific terms, reminds us that zombie folklore is historically inseparable from slavery.  Haitian zombies were created not by a virus, but by a sorcerer (bokor) whose black magic created undead laborers who would work indefinitely for free.  This suggests that zombie labor might be analyzed in the same manner as slave labor.

In a justly famous (or infamous) book titled Time on the Cross, economists Robert Fogel and Stanley Engerman made the controversial claim that slavery in the American South was actually an efficient economic institution.  It’s worth pointing out that “efficient” isn’t necessarily the same as “moral”; their argument was purely economic, not ethical.  Nevertheless, the book unsurprisingly generated a great deal of criticism, from economists and others.

I can’t begin to summarize the whole debate initiated by Time on the Cross here, so I’ll focus on just one aspect that seems especially applicable to zombie labor:  the allocation of labor to different types of work.  One argument for why slave labor might actually be efficient in this regard is the Coase Theorem, which says that productive assets tend to be allocated to their most valuable uses regardless of initial ownership, provided that transaction costs are low.  In this case, what that means is that regardless of whether a person owns himself (self-ownership) or is owned by others (slavery), his labor will end up being used for its best use, whether that is picking cotton, rolling cigars, or something else.  Whoever owns the person’s labor, they will tend to use it — or sell it — for whatever purpose generates the highest value.  If a person generates greater value in cigar-rolling than cotton-picking, then he will choose to roll cigars (if he owns himself), or he will be sold/rented to a cigar-rolling business (if someone else owns him).  For essentially the same reason, we should expect zombie owners to use zombie labor in whatever way generates the highest value. (Zombies, being mindless, couldn’t be expected to sell their labor at all — but that only strengthens the case for ownership by someone else.)

What this analysis ignores (or rather, one thing it ignores) is the costliness of turning a free person into a slave and keeping them that way.  First, there are the costs associated with capture and enforcement, such as slave ships, overseers, and fugitive slave hunters — all of which are valuable resources that could be used for other purposes.  Second, and more subtly, there are the costs created by the incompatibility of slave labor with certain types of production.  It is relatively easy to extract the maximum amount of cotton-picking from a slave.  It is much harder to extract the maximum amount (and quality) of entrepreneurship or novel-writing or mathematics instruction from a slave.  How can you tell whether they’re really doing their best?  Extracting the optimal effort requires incentives, in the form of wages and profit shares — which represent partial movements away from pure slavery and toward self-ownership.  Pure slavery, at least, tends to lock slave labor into lower-valued uses because higher-valued uses are incompatible with the means of enforcement.

Now back to the zombies.  If zombies are people who were already dead of non-zombie causes and reanimated after the fact, there’s a really strong case for the efficiency of zombie labor, provided that the cost of reanimating them isn’t too large.  If a zombie creates any value at all, that’s more value than a corpse in the grave would have created.

But as the linked article suggests, “real” zombies may be created through a two-step process.  First, a bokor exposes a living person to a natural neurotoxin that creates the appearance of death.  Second, after the person’s family and friends have been convinced of their death, the bokor applies “a drug made from the plant Datura stramonium, commonly called Jimsons Weed, or the ‘zombie cucumber,’ which has potent psychotropic properties and would keep them in a delirious, trance-like state vulnerable to mind control.”

If this is how zombies are indeed created, then they represent an extreme case of slavery — and its inefficiency.  The relevant comparison is not between a zombie and a corpse in the grave, but between a zombie and a live human being.  The application of the neurotoxin and the mind-control drug are analogous to the cost of slave ships, overseers, and fugitive hunters.  But more importantly, the zombified individuals lose the ability to do sophisticated labor; they becomes mindless and non-communicative.  As a result, their labor is confined to low-valued uses, which for at least some zombified individuals represents a notable reduction in economic value.  As with regular slaves, zombified workers’ highest-valued uses may be incompatible with the means of enforcement.