taste sensation helps us to enjoy foods, detect undesirable foods and to initiate the digestive responses when we put food in mouth that is the cephalic phase of digestion, isn't it? So, how do we detect this taste sensation? Taste sensation is detected by certain cells known as taste cells which are present in taste buds and these taste buds are in turn located on the papilla which are present on the dorsal surface of the tongue. So, let us start from the papilla. See, this is a schematic diagram showing the dorsal surface of the tongue and on the tongue we have three types of papilla. One is the circumvalid papilla which is present on a V shaped area at the posterior side of the tongue. Then there is foliate papilla. This is present on the posterior edge of the tongue and here on the lateral border of the tongue and the last one is the fungiform papilla which is present on the anterior aspect of the tongue. So, three types of papilla are there and simply you remember that circumvalid V is there. So, it is present in a V shaped area on the posterior part of the tongue and foliate. So, how I remember late like that. So, this is present on the lateral edge of the tongue. Now, these papilla, papilla is basically projections on the dorsal surface of the tongue. So, these papilla have taste buds. So, here you see these are the projections and on these we are having these small taste buds. Now, these papilla have different number of taste buds. Circumvalid papilla has around 100 taste buds. Each papilla okay and foliate papilla also has 100 taste buds. However, each fungiform papilla has only 5 taste buds. So, there are less number of taste buds in the fungiform papilla. Now, let us see the structure of these taste buds. You see here is a diagram of a single taste bud and this taste bud is having lot of cells. Basically, these are modified epithelial cells okay because they are present on the surface, isn't it? So, they are modified epithelial cells and they form the different types of cells in the taste buds and these are one is the important taste cells which are basically the receptor cells. So, the sensory transduction that is conversion of the chemical which is causing the taste into an electrical signal is done by these taste receptor cells. Then there are other cells as well, there are support cells and there are basal cells. See, these taste cells have a life span of approximately 10 days. So, they die after 10 days and it is these basal cells whose multiplication causes the production of these taste cells. So, these basal cells are basically stem cells which are responsible for the production of new taste cells. Now, you see these taste cells, they are having certain microvilli. So, each taste cell we see, so I am going to expand this taste cell, they are having microvilli on their surface and these microvilli open on the dorsum of the tongue by means of a taste pore. So, all the microvilli are projecting into the taste pore. So, the taste ends may contact with the proteins which are present on the surface of these microvilli of the taste cells. Now, based on the chemicals which are present in the food, we have different types of taste sensations and basically we have five types of primary taste sensations. So, these primary taste sensations as we all know are saar, salt, sweet, bitter and umami. Saar is caused by acidic foods, okay and the sourness of the food depends on the concentration of the hydrogen ions which is present in the food as the hydrogen ion concentration increases, the sourness of the food increases. Then salty food it is caused by ions and these ions basically are cations like sodium ions and other ions as well, even potassium ions. Now, depending on the cation which is there, the saltiness of that particular food item will be different, you know that normally we are using as NaCl as the salt. But there are food items which are also having saltiness and it depends on the presence of the different cations which are present in that food item. Then sweet and bitter both actually are caused by organic substances and these organic substances vary for sweet it is many substances are there like sugars, alcohol, different types of aldehydes, even ketones they are all sweet. So, don't think that only sugar is sweet, there are other chemical compounds also which are sweet and bitter that is also by organic compounds that is basically the alkaloids, they are having this bitter taste and it is very important because this bitter taste has very low threshold that is important low threshold that means even if it is present in food in very small concentration that can be detected and it has survival value, how? Because this alkaloids are actually present in poisonous substances found in nature in plants. So, that is the reason that evolution of this low threshold of bitter taste sensation has happened. So, we can actually reject the foods which we find bitter. Then finally, there is this umami taste and umami basically means a pleasant taste it's a Japanese word and it means pleasant taste and this taste is caused by food which are having a chemical compound known as L-glutamate. Understanding? So, you see depending on the different chemicals which are present in the food we are having different taste sensation.  Why? Because all the taste are a combination of all these tastes. So, there are taste cells which will be stimulated by these different chemicals and actually the sensation which we will have will be a combination and that is being perceived at the level of the cortex. Secondly, you might have heard about the concept that suppose this is the tongue and it is this particular area is responsible for detection of a particular taste and this particular area is responsible for the detection of a particular taste. But that is an old concept you should remember that actually from any area of the tongue we can detect any taste. It is not that a particular area of the tongue is designated for a particular taste. Now, as I told you before that the chemicals which are present in food are dissolved by saliva and then that taste tint that is the chemical makes contact with the microvilli of the taste cell. So, this causes the stimulation of the taste cell and there will be generation of the action potential and all. Finally, it is saliva only which washes away that chemical from the mouth. So, saliva is responsible for the taste if saliva is not there that is in case of zero stomia then there will be decrease in the taste perception. On the other hand, saliva is also responsible for washing away that chemical from the mouth so that we can enjoy the other food as well. So, now let us see how a particular chemical is causing the excitation of the taste cell. So, this diagram I have shown you before this is the diagram of the taste buds having different types of the cells. Now, what happens that when a taste tint or the chemical makes contact with the membrane of the taste cell then there is depolarization of the taste cell. We will see how this depolarization is occurring. Now, this depolarization what it does that in the taste cell there are the vesicles containing the neurotransmitters right. The neurotransmitters will be released and they will stimulate the afferent nerve which are supplying these taste cells. So, this causes the generation of receptor potential in the neuron okay understanding. So, there is depolarization of the taste cell leading to the fusion of the vesicles on the membrane which in turn stimulates the nerve fibers leading to the generation of the receptor potential. Now, this receptor potential is a graded potential meaning that as the intensity of the stimulant or the chemical is going to increase more the chemical in the food substances more will be the magnitude of the receptor potential which is formed and this will lead to generation of the action potential. So, this concept of the receptor potential action potential that I have dealt in sensory physiology in detail in the videos on sensory receptors that you can have a look. I have given the link in the description section of this video also. Anyways, back to it. So, what we were telling that there will be generation of action potential and more the receptor potential more will be the frequency of the action potential. Now, remember here that as long as this chemical is present, there will be generation of the action potentials but initially there will be increased frequency of the action potential and despite the continued presence of the instant the frequency of action potential is going to decrease and hence the action potentials which are reaching to the cortex that is also going to decrease. So, it is going to decrease our perception of the taste as well. This you can very well understand from our common knowledge. Suppose there is particular food we are eating. So, initially we will feel a blast of the taste sensations right but if we keep eating the same food for some time then the taste is gets decreased. So, that is kind of an adaptation happening at the level of the receptor. Okay, but what is the mechanism by which this chemical signal is being transmitted into the electrical signal of depolarization. Now, that varies with the taste sensation or the taste tint. So, for saar and salty, we have seen before that it is basically ions which are involved in this for saar it is hydrogen ions and for salt it is the cations mainly the sodium ions. Now, on the taste cells there is presence of certain channels known as epithelial sodium channels. Actually, whenever this ion is present it can directly enter into the cell by means of these enac channels and that will lead to depolarization. Sodium entry is going to lead to depolarization but there can be entry of hydrogen ions also via these channels understanding. So, hydrogen ion entry also leads to depolarization of positive ion so there will be depolarization. Second, hydrogen ions also act by another mechanism what they do that they block the potassium channels and once potassium channels are blocked. So, here these are potassium channels suppose potassium cannot go out right. So, potassium will start accumulating within the cell and that is also a kind of depolarization because positive ion getting accumulated in the cell. So, sodium ions enter into the cell by enac channels then hydrogen ions act by two mechanisms either they can act directly by enac channels or they can also block the potassium channels thus blocking the efflux of potassium from the cells and leading to depolarization. So, that is for the ions which are causing the sour and salt taste. The other taste sensations that is the sweet, bitter and umami for these we have different types of receptors that is the G protein coupled receptors or they are also known as metabotropic receptors. So, these ion ones are known as what? Ionotropic receptors, ionotropic receptors and these are metabotropic receptors. So, the chemicals that is the organic compounds which are there they will bind to these receptors they will lead to the activation of these G protein coupled receptors ultimately causing downstream events. So, either there will be increase in CAMP or decrease in CAMP or depending on the type of the G protein coupled receptor and hence ultimately the product is going to cause the opening of the different ion channels causing the entry of the sodium ions. So, this is an indirect way of action by metabotropic receptors ultimately leading to depolarization ok. So, sensory transaction occurs based on the chemical which is there fine.  So, taste pathway like other pathway consists of three neurons. So, there will be first order neuron, second order neuron and third order neuron. Now, you see that there are different nerves which are carrying the information one is the facial nerve. So, here you see seventh nerve is there it carries the information from the anterior to third part of the tongue. So, basically these exons are supplying the tastes which are present in the anterior to third part of the tongue. Then we have the ninth cranial nerve that is the glossopharyngeal nerve and it is supplying the area that is from the posterior part of the tongue that is the circumvalid papilla from there the information is going via the ninth nerve ok. And again behind the posterior most part actually these taste buds I have missed before these taste buds are also present on the pharynx they are present on the tonsillopillars which are there they are present there also then even in the epiglottis ok they are present and in the soft palate as well. So, from these areas it is the tenth cranial nerve which is carrying the taste sensation. So, three nerves are involved seventh cranial nerve from anterior to third part. Ninth cranial nerve glossopharyngeal nerve from the posterior one third part of the tongue and the tenth cranial nerve from the posterior most part right. And all of these reach the NTS in the brain stem nucleus tractus solitarius and they go and synapse there. So, you see here synapse is shown. So, what is the first order neuron? From the tasers the cranial nerves carrying information to the nucleus tractus solitarius. So, all these are forming the first order neuron. Now from nucleus tractus solitarius the information is going to the thalamus and the nucleus here is ventropostromedia nucleus of the thalamus. So, this is the second order neuron and you see one specialty here that it is on the ipsilateral side that is there is no crossing over. So, in the taste pathway there is no crossing over. It goes to the postromedia nucleus of the thalamus and synapses there. Then from postromedia nucleus of the thalamus it goes to the gastiatric cortex which is basically present in the parietal cortex but little deep right. So, it goes into the gyri of the parietal cortex in the anterior insula and frontal operculum anterior insula and frontal operculum in the parietal cortex. So, that is the third order neuron which forms a taste pathway fine. But remember one thing here that this is a simple taste pathway. However, this pathway makes contact with other pathways as well. You see that the flavor of food which we get how it is happening? It depends on both the smell and the taste. If the smell of the food is not enhanced much then the flavor of the food we feel is lesser right. Secondly that there is activation of the salivation as well that is happening because some information from this nucleus tractor solidarius within the brainstem it is going to salivatory nuclei as well okay salivatory nuclei and from there there is activation of the efferents to the salivary glands and initiation of the salivation. So, that is the reason that when we keep food in mouth there is initiation of the salivation. Now, only thing which is left is certain abnormalities and there are certain terms which you should know. One is egusia that is absence of the ability to detect the taste then there is hypogusia. Hypogusia is decrease in the ability to taste then there is dyscusia dyscusia or also known as paragusia which is unpleasant perception of taste unpleasant perception. So, taste is something else but we are tasting something else that is dyscusia or paragusia. So, that was the complete physiology of taste sensation. Thanks for watching the video. If you liked it do press the like button share the video with others and don't forget to subscribe to the channel physiology open. Thank you.


The learner centric MOOC model consists of learning dialogues, learning by doing, learning extension trajectories, learner experience interactions, all of which are connected through appropriate orchestration between the course team and the learners. We will now discuss about learning dialogues. Broadly speaking, learning dialogue consists of content which may be a video explanation of the topic interspersed with one or more reflection spots. Reflection spot is a point where the content is paused and the learner is required to answer a question. What exactly is the content? The content could typically be a short video explanation or it could be some text which the instructor wants the learner to read or it could be animation. So, any concept that the instructor wants the learner to acquire could be captured as the content. Is it sufficient to only capture the content like many of us have seen videos which go on and on. So, even if the videos are short, many of us do not see the videos beyond a certain point. So, what a learning dialogue does is something more than simply provide the content. The learning dialogue has a reflection spot. Conceptually, a reflection spot is a question that makes the learner pause, reflect on the preceding content, express their thinking. Reflection spot allows the learner to micro practice or simply apply the concept that they have learned immediately. Operationally, a reflection spot may be implemented as a multiple choice question or as a fill-in-the-blanks or even as a short answer question. A reflection spot is followed by content. Once again, this content may be a summary of what were the expected answers in the reflection spot or it may be continuing further from the reflection spot. The key idea here is to have the reflection spot question in such a way that it is connected to the content that is immediately preceding it as well as to the content that is immediately following it. The goal of a learning dialogue is to provide this conceptual knowledge along with explicit spots for learners to express their conceptions, do micro practice and reflect on what they have learned. How does an instructor do that? Instructor does that by creating a learning dialogue which has content and reflection spots which are related to each other. The learners access the content, carry out the action recommended in the reflection spot. They respond to questions, they express their thinking and then they access the content that follows the reflection spot. Now you will see a screen which has a question. This is a reflection spot. The reflection spot question is what is one advantage of a learning dialogue over a content delivery video? You have to think about the content delivery videos that you have seen all the way from one hour lectures, write down to short interesting engaging videos and think of what is the way in which a learning dialogue is different from them and write down one advantage of using the learning dialogue over a content delivery video. Once you have completed the activity, you can press resume to continue with the video. Some of you may have written a reason like a learning dialogue is short while other videos may be long. Others may have said that the learning dialogue is about the topic, it is focused. All of these are valid reasons. However, one important benefit of the learning dialogue is the reflection spot. The reflection spot has many benefits, some of which are that the learner is engaged with the content since the learner has to do something. The learner is not simply passively watching the instructor go on lecturing, but the flow of the video is interrupted and there is some dialogue that happens and the learner has to express their ideas either via a poll or an m c q or write something. The second big advantage of the reflection spot is that it is connected to the immediately preceding content. So, it gives opportunity for the learner to immediately apply their learning or express their thinking and since the content that follows the reflection spot attempts to capture various learner responses, a learner can get feedback on their own responses. One point to keep in mind is that although reflection spot is a question, it is not meant as an assessment. We are not grading learners by asking this question. The purpose of the reflection spot is to ensure that learners are engaged. One, learners look forward to expressing their opinion or answering the question and they know that it is not being graded and two, the content in the reflection spot is connected to the concept that is being discussed in the learning dialogue. So, essentially a learning dialogue promotes concept acquisition through learner interaction. It is not simply a one-way transmission of concepts.


Welcome to module 6 of chemical kinetics and transition state theory. Today we are going to look at the distribution of speed and velocities. In last module we had looked at the Boltzmann distribution itself, but what can we do with that Boltzmann distribution is what we are going to look at today. In doing so, we will also cover up one important topic that will be important later on which is the translational partition function. So, a quick recap of module 5, we had given you a partial derivation of calculating the equilibrium density matrix. It is given by this Boltzmann distribution e to the power of minus beta h where h is the Hamiltonian divided by q and q is called the partition function which is an integral over all space dp dq into e to the power of minus beta h. And we also discussed how to be calculate average of any property. If I have any quantity let us say a as a function of some q and p in general to find the average of a, I must integrate over all p and q rho which gives me the probability of being at q and p multiplied by a which gives me the value at q and p. So, in the last module we looked at a few examples which is average momentum and average kinetic energy. So, before moving forward let us do one thing which is going to be useful. So, I have written down the definition of our rho equilibrium which is what we derived in the last module e to the power of minus beta h divided by what this integral is basically the q, written the Hamiltonian explicitly which is the kinetic energy plus the potential energy. So, I want to just substitute this h in this rho equilibrium and see if we can simplify this equation a little bit. So, if I substitute what I get is. So, I write h as sum over i p i square over 2 m plus v of q divided by integral of dq integral of dp e to the power of minus beta I write the same big summation here and summation in exponential can be converted into a product of exponentials. So, I write the same thing as e to the power of minus beta sum over i p i square over 2 m into e to the power of minus beta v of q divided by and I will do the same separation in the denominator. I will write the momentum first because I have momentum first in the numerator. So, just to be consistent we write it as this my bad it should be an integral not a summation. So, let us remove the summation let us put in the integral dq e to the power of minus beta v of q. So, what you notice that we have separated the terms as a function of p and as a function of q. So, this part we will define to be rho equilibrium of p only p no there is no q dependence in this. This portion I will define of q there is no p dependence in this one. So, in total I am writing this rho equilibrium of q comma p in separable form of rho equilibrium of q into rho equilibrium of p where rho equilibrium of p is defined here and rho equilibrium of q is defined here. So, let us look at the equilibrium function for p for a moment we can actually simplify it a little bit more. So, I have rewritten the rho equilibrium of p right here.  So, this denominator that we get is called the translational partition function why translational because it is simply kinetic energy. So, this is the partition function when v of q is 0 for a free particle ok. So, this partition function is called the translational partition function and we can actually simplify it and calculate it we can find an closed form answer for this. So, let us try to do that. So, this thing first of all note that integral over dp vector is the same thing as integral over dp 1 integral over dp 2 till till integral over dp 3 m remember we have 3 n momenta 3 n positions why 3 n n is the number of particles for each particle I have x y and z. So, I have p x p y p z for particle 1 p x p y p z for particle 2 there on so forth. So, I have 3 n momenta. So, this is what I have that I have to calculate well we note that I can simplify this integral as e to the power of minus beta p 1 square over 2 m into e to the power of minus beta p 2 square over 2 m till e to the power of minus beta p 3 n square over 2 m. So, I have again taken the exponential exponential was a sum form. So, I can take it into a product form ok. Now, I note that this is equal to so, I separate all the terms out take them to the corresponding integral. So, let us look at each integral separately. So, I separated out all the integrals all are independent integrals and I can evaluate them one at a time that is the beauty of this. And this one integral is called a Gaussian integral from all overall space minus infinity to plus infinity that integral form is known I have provided you the formula and again throughout the course any integral which is complex we will provide you you do not have to memorize any of this this is not really a max course ok. So, this thing here we note that in my formula I have provided you this a.  So, this thing becomes equal to root of 2 pi m k B. So, I am simply using this formula here root of pi over a. So, root of pi divided by a, but a note is 1 over something. So, I get this thing, but I get the same integral when I solve for P2. In fact, I will get the same for all 3 n of them. So, if I multiply these together what I get is or I just write slightly differently. So, now we have derived the formula for the translational partition function this will be useful later on. So, we will keep it for now and once we use it I will remind you of this. For now this is nothing but the denominator of rho equilibrium of P. So, now finally, I get rho equilibrium of P is equal to e to the power of minus beta sum over i P i square over 2 m over 2 pi k B T m to the power of 3 n over 2. So, let us just look at it in one dimension only. So, for this I get rho equilibrium. So, for n equal to 1 I still have 3 momentum p x p y p z and in our notation we refer p 1 as p x p 2 as p y and p 3 as p z and here I will substitute n equal to 1. So, I get this. So, that is your distribution of momentum in one dimension. Trying to figure out what will be the distribution of speed. After I do not care what is the value of momentum in different directions x y and z speed is a more natural quantity. I want to figure out how fast is the particle moving yeah that is a very natural question to ask. So, that is what I am trying to figure out. So, let us get to that. First of all let us be formal and define speed.  But I write it in the language of momentum and I call this as modulus of p divided by n where modulus of p. So, I am trying to find a distribution of u and how do I do that. All right. So, let us just look at rho once more of p 1 p 2 p 3. This is equal to e to the power of minus beta just from last slide. The important thing to remember when converting between distributions. So, I am going from a distribution of p 1 p 2 p 3 to a distribution of u. When you do that in whichever field not only kinetics or thermodynamics, quantum dynamics wherever, remember the volume element that is very important. So, I will start writing that a little bit more explicitly. So, this is really what this probability density anyway mean. In a very small volume of size dp 1 dp 2 dp 3 what is the probability of finding the system there. So, I am asking you the question what is the probability rho u du is equal to. We will actually start with slightly different question which is what is mod p dp. Because here I have everything in the language of momentum. So, I will start with momentum and then I will go back and answer this question. Now, to calculate this I will have to remind you a little bit of what is called the spherical polar coordinates. You must have seen this in some form or another. It occurs in many many different contexts. So, imagine you have three dimensions x, y and z. I define a new coordinate system which is called r, theta and phi. R is nothing but what we are looking for in the previous. Theta is the angle that the vector r makes with the z axis and phi is the angle that the projection of the vector r on the xy plane makes with the x axis. So, a few important properties that I want to remind you of r goes from 0 to infinity, theta goes from 0 to pi and phi goes from 0 to 2 pi. These are the limits and more importantly what is the volume element in this. So, dx dy dz is equal to r square sin theta dr d theta d phi. So, now the rho equilibrium I had already written in the last slide. I have forgotten to write dp1, dp2, dp3. I want to find rho equilibrium p theta phi dp d theta d phi. That is my first challenge. So, that you can see e to the power of minus beta, this you note is mod p square over 2m. Once more, mod p is nothing but root of p1 square plus p2 square plus p3 square divided by 2 pi kb tm to the power of 3 half. And now we introduce the volume element that we talked of in the last slide which is mod of p square sin theta dp d theta d phi. But this is not what we wanted. We wanted rho equilibrium of just p. I do not care which angle theta and phi it is. Anyway, theta and phi are arbitrary. They depend on my axis choice. So, what I am going to do is I integrate over all of theta and all of phi. So, because I want the average value of theta and phi. Again, the range of theta is 0 to pi, phi is 0 to 2 pi. And I write this whole thing here and I write dp or I should have a dp here as well. So, what I do is I take the terms that are independent of theta and phi outside the integral. And then I integrate over theta and phi. So, for theta you note I have sin theta for phi I have d phi. I leave it as a homework for you to prove this is equal to 2 and this is equal to 2 pi. These are very easy integrals you should be able to do. So, in total I get 4 pi mod rho square mod p square I am sorry 2 pi kbtm to the power of 3 half e to the power of minus beta p square over. So, I calculate this rho equilibrium I have just copied it from the last slide, but I wanted rho of u not p. So, well that is not very hard now. I note that u is defined to be mod of p over m and so, du is d mod of p over m. And so, we just substitute these quantities here p is mu dp is m du.  This is rho equilibrium of u du. So, I just simplify this a little bit this m cancels with this just massaging a little bit here and there I get 4 pi u square. And I just transform this into this form. You can quickly verify whether I have written it correctly or not. Make sure you can do this if I have made a mistake then please correct. So, this is the final form I get for the Maxwell Boltzmann distribution. It is a very famous distribution it is named after these two outstanding scientists Maxwell and Boltzmann who have contributed immensely towards statistical mechanics. So, let us just look at one thing let us make a plot of it because I just want to look at as a function of u how does rho equilibrium of u look like. So, well if you look at it this function is a product of two different functions one is u square. So, u square looks like this. So, I am just qualitatively trying to find how the curve will look like and the other function is this Gaussian and this Gaussian looks like this. This will keep on going till it reaches 0 at infinity very qualitatively I am not being very precise here. So, if I take a product of these two my question is what will you get. So, I would recommend pause the video take a moment and multiply this on yourself do not take help of any computer or anything and make a plot. Hopefully you pause the video and made the plot by your own self. So, the point to note is that rho equilibrium I should change the color rho equilibrium of u equal to 0 is 0 if I put u equal to 0 this red thing goes to 0 and rho equilibrium of u equal to infinite is also 0 because the green thing goes to 0. So, I start with 0 here and I must end with 0 as well. So, I get a function that increases initially and then over time it decreases and goes to 0. So, this is the Boltzmann Maxwell Boltzmann distribution. So, I have a challenge to you a question you have this distribution good in the previous module we calculated the average momentum and we showed it is equal to 0. What is your guess what will be the average speed will it be 0 greater than 0 or less than 0. So, please go to this link that is provided here and answer there this is completely anonymous this is for your own good and you will get an immediate feedback based on your answer. So, hopefully all of you have answered this question based on whatever you think it is right let us try to solve it now. So, the average u well how do I find average u it is a same trick integral over du rho equilibrium of u into u. Now, the question is what is the limit for u is it minus infinity to infinity or 0 to infinity it is 0 to infinity remember that u is magnitude it can never be negative we are only dealing with the overall quantity.  So, we take all the constants out of the integral and what we are left with is 0 to infinity du u cube e to the power of minus beta m over 2 u square. And again as before we will provide you the integrals when you need the integrals this is slightly complex integral and so, we have provided you the answer here on how to solve. So, to match these 2 my a here will be beta m over 2. So, I get m over 2 pi k t 3 half into 4 pi and 1 over 2 a square 2 a is I will write this as m over 2 k b t because I have k b t in this equation. So, m square into k b t. So, you can go ahead and simplify this equation and show this is equal to root of 8 k b t over pi. So, this is clearly greater than 0. So, by the way you did not had to do the match to tell whether it is greater than 0 or not. See speed is a positive quantity. So, if I am averaging over a lot of particles over positive numbers only well you are going to get some positive number right. So, it cannot be 0 it cannot be less than 0 I have some speed of some particle which is positive and so, you can formally show it is equal to this. So, in summary today we have looked at the Maxwell Boltzmann distribution of speed. It is a very important distribution and this will be very useful in the coming modules when we discuss kinetic theory of collisions. We have shown that the average speed is equal to root of k 8 k t over pi m. Please do not memorize any of these as and when needed we will always be providing you equations. This is not a memory going to be a memory test this is not going to be a mathematics test. Finally, one another thing just keep in mind for future we have also derived what is called a translational partition function as m over 2 pi k t to the power of 3 over 3 and over 2. Thank you very much.


My placemat at breakfast was paper, and it was flat, which to you probably seems pretty reasonable. And to me is totally irresistible, because I love to get my fingertips on paper, and I am a paper engineer, which means that my job and my drive is to make paper not flat anymore. In this case, I made one cut, made a couple folds, I inverted the center crease, and along the way, I created a very simple pop-up. Two, really, there's a top and a bottom along the way. I have new creases to work off of, four perimeter valley creases, two mountain creases down the center. That is a technical way of saying, look, I made a mouth, right? It wants to be a mouth, and I'll tell you why it wants that, because paper and ink have been lovers for millennia. It is so easy to augment this notion. We make two circles, we make two dots, four marks on the page, and we have a face. Five marks on the page, and we have Lakshmi. This is one of two main types of pop-up. This is called a page-action pop-up. The energy of opening a page makes something happen. The other main type is called an interactive. This is like that. It could be in a book, it could stand alone. This is one piece of paper, cut and folded. This is also glued. It's one square foot that becomes one cubic foot. I love it. If you think this looks like math, we agree. If you think this looks like magic, we also agree. It's that combination that gets me charged about the craft and the art of paper engineering. I'd like to take you on a little brief survey of some of the basics of paper engineering. Starting with one of the first pop-ups that I ever engineered solo. This is by Jonathan Langley. It's the story of Goldilocks and the Three Bears. There's your page-action. You open up the book, and that makes Goldilocks scarf up the baby bear's porridge. And a couple pages later, you have your interactive. You pull a tab, something happens. Two things, really. She sits and then her skirts go, yeah, actually I was very pleased with myself when I finally figured this out, because it was hard. I was in the early days. Not all pop-ups were kids. This is an adult book for the cigar-smoking market. Pop-ups make really good reference material. So that's a tobacco plant that you can peruse. And not all pop-ups are for books. This is a pop-up play set. This is the Chronicles of Narnia. These were happy meals. So tens of millions of these were made and distributed around the globe. This is by far the most popular thing that I ever worked on. And I'm going to segue to the least popular thing I ever worked on. This never got off my desk, but I really like it. You pull the tab and the sun, and it's raised, rotate around a common point in opposite directions. Here, I liked it so much. I used it again. Instead of rotating the two pieces, pivot in opposite directions around a common point. Again, this is a technical and pretty unenthusiastic way of telling you, look, I made something that I think is clever or cool or lovely. And I want to share with you today three offspring that I tried to make clever, cool or lovely. One came to me in a dream. One came to me by accident, and one I actually put a lot of effort into. The first would be this. What do you do with this guy? This is the villain of an animated movie about bugs. The client wanted a doll or a stand-up figure. I wanted something with more than that. That's what I'm thinking about on a Friday, right? And on a Sunday morning, I woke up from a dream with the blueprints for this in my head and on my hands. And I ran over in my underwear, and four minutes later, remarkably fast, I had this. Now, it's pretty rough. That's how paper engineers work. It's a sketch in paper, but it's enough. It's enough to give me this, right? This is a second stage of this little figure. Now, he was deemed a little too rough for the kids, but we did apply this technology to the other characters. The future queen of the colony has long, elegant wings. Notice now this piece is all one integrated piece, nice and clean. One piece of paper printed both sides, neatly folded on itself and glued to itself. There's the other hero. He surfs on a leaf. A younger sister has comically stubby little wings. And this guy has no wings, but he rocks back and forth in a jolly way, right? Same mechanic. I hadn't seen anything like this before, and I guess no one had either. So the company actually applied for patent in the name of the inventor. That's U.S. law. I'm the name of the inventor. So I have a U.S. patent, which is sort of good news, bad news. The good news is I'm proud of it. My grandmother is ecstatic about it. But the bad news is I think it requires an asterisk because my subconscious actually invented this. The next thing I want to share with you is something that was more of a conscious effort because I worked pretty hard on it. This is my attempt at making in paper this old wooden or plastic toy called the tumble cube. I hadn't seen it in paper before, but more compelling to me, I hadn't seen anyone really use volume before, right? Most children's learning blocks and even Rubik's cubes are all about the surface. I wanted to maximize that volume. So I worked with an artist named Susan Mitchell, and we came up with the Christmas box. It's interactive. It's red. There's things to touch. Some are tantalizingly out of reach. Some of them are right up front or behind windows. There's things to take apart. And it's got a lot of different configurations. And every time you have a configuration, something moves. There's a door to pull, a drawer that opens. There's this little scrapbook. It's a mouse family getting ready for the holiday season. Notice now the red of the outside is about to become the blue of the inside. There's eight cubes here with six facets each. That's 48 total facets. We're looking at half of them. That's 24. 24 things to play with. 24 is the number of days leading up to Christmas. So when I thought of that, when I'm in the prototype stage, I said, that's what I'll do. I'm going to make an advent calendar that's interactive. And that's what was satisfying to me, and I thought I was done. I got this prototype on my desk, and one whole side of it fell forward. It was badly taped.  My second thought is, hello, secret compartment. Because that's what that is, and that's what that became. And it worked its way into the final design. So there's a secret compartment. It's the outside of the mouse house. Santa's sleigh is on the top of the roof there, pulled by a red robin. I like that touch. This is the inside. The mouse family's snugging their beds ready for the holidays. I'm going to show you in close-up. Now take a look. On the left is a rocket and a box. On the right is a crescent moon and a window. There's a secret compartment. Mama, papa, mouse, or sleeve-in. Brother mouse is sleeping. Little baby mouse is crept downstairs to see Santa just in time to put the presents under the bed. Now inside that grandfather clock, upside down, facing the other way is a rocket. Underneath that stairway, of course, is a crescent moon, and the whole thing folds back together, ready to go under your Christmas tree. And the final project I want to share with you is paper engineering gone wild. I was allowed to do whatever I wanted on this. It was pretty rare, but I wrote it, and I engineered it, and I even illustrated it with, predictably, paper sculpture. It came out a couple years ago. It's called, If I Were a Polar Bear. White as an iceberg from head to toe, I'd set out alone across the snow. The boldest explorer you'd ever seen if I were a polar bear, I mean. And this is just a lot of paper doing the talking. It's not about snow. It's about paper. And I start with a curve because curves are hard and I'm showing off. Even that flat piece has contoured curves. And you've got these footprints. They guide you on your path past the old snowbound shack of explorers who came, but got cold and turned back. And of course, you can get in there and see what the explorers left behind, right? It's a map in there and a calendar and apparently a dartboard. And this is a cheat. No engineering at all on this. I made the polar bear make a snow angel for two reasons. One, I like it. And two, I'm saving paper because I have big plans for this book, and this is my big plan. The whole reason I did this book. I wanted to do an igloo. That's a dome. That's very three-dimensional. Got a little sled and a fishing hole by it. And again, more paper freak stuff because this is shiny paper for the water and glossy paper for the footprints and matte paper for the ice. A little bit of color, a lot of drama. Bear jumps in, comes back out. Where is he? There he is, the North Pole. South, south.  If I were a polar bear, I'd be so proud. When I reached the pole, I'd growl out loud but adventure awaits. And so off I'd go one step ahead of my tracks in the snow. And that's it. That's how the book ends and that is how this talk ends. And I want to tell you, let me share with you five marks on a page. You make five marks and then figure out what to do with it. You add the folding and the cutting and the gluing. Then you add something old school. You add a printing press and ink.  That is something that I like. That is a bear that I find clever and a landscape I find cool and an object that I find lovely. That is paper that I can touch. That I don't need digitized anytime soon because I am a very playful and progressive man but I am a stubborn craftsman. I don't want to show you what I make. I want to hand you what I make so that you can touch it too. Thank you for having me.


Trade no, I've read a lot of notes on mine diploma trade My name is Jimmy his name is Jake and this is the weekly dumb Jake How are you feeling? Did you get a good night's sleep? Nothing but James We've been burning the midnight oil this week and yeah, our yanks looked really good We went to the Mets game the day is stink, but everything else is alright I've gained eight pounds from Beach Week. Yeah, Jake. I had a five-hour old hot dog yesterday Well, that's a women's start there. I slept in the office that in your notes I slept in the office. Yeah, I'm wearing a bathing suit from our giveaway rack And I showered in the office number two no towels No, nothing air-dry air combination of air dry and paper towels Paper towels, it's a low feeling you had your baby this weekend Shower my baby shower.  Yeah, it was kind of like a Before this is what's gonna happen later. Yeah, they should do that at baby showers mock births. Yeah, like a Nativity but real Like a wedding rehearsal. Yeah, let's get into the dance. I give you my notes Toss them Can you tell me about the sports James? Let's talk about the sports a lot of this company talks about baseball our brew crew Through a no-hitter Corbin Benz. Yes. Yes, and Josh Hader combined on it So people don't like that stuff don't really care Scherzers killing it 3,000 strikeouts Lindor Stanton last night was a lot of fun Baseball remains on the streets overseas Mike Montgomery threw a rosin bag at an umpire Yes, which I hadn't seen before pegged them right in the back. Yeah, just like powder everywhere And know what was the the takes I saw on it was like Mike McGon, Mike McGit, Mike McGinnery He'll never throw another pitch again, and I was like I get it They're supposed to be a boundary between players and umps and that kind of stuff But like and the day through rosin bag didn't even like him in the face or anything like let's grow up a little bit Let's look at this and make Zach do something with it We love talking about things together. What's the next one? We're kind of tired. Hey Jim Why don't you tell us what almost ripped I was this week almost a breakdown this week is awesome. It's the everyone's seen it It's been so cool.  Oh, I can for the cat. I had my arm out I was wondering maybe I could leap leap up and latch on to me if the guy got a good swim stroke And he could have got to me. Yeah guy nice try But what to the left of that guy from when you're watching the video. There's a group of people Directing the flag holders below. Yeah, there's a couple below that always brings an American flag to the game And they quickly took it off the railings It was like taped on there or whatever and then started holding out as a blanket to catch the classic fireman save move And they needed to be more because the cat lands Right in the corner of the flag by the guy's left hand, right? And he doesn't have a firm grip with that. He's a righty, right? So it breaks the cat's fall, but it goes down.  Yeah, I'm not interested in getting pet by you And then there's this one woman who's like give me the cat And I'm hoping she was a van and she was like I'm the she was like I'm the only one in the stadium equipped to handle this cat see I hate that lady Because she thinks she's entitled to the cat Yeah, like she wanted the next headline to be like cat that was that party football game hanging from the railing Now owned by lady. She wanted that headline calling them party football games verbatim Yeah, and no you like you don't have the rights to that cat.  No, that wasn't me Catch that cat catch that cat. It sounded like your ears were clocked You walked in with paper towels in years.  No scratches.  Is there any other sports news on man Is there any other sports news question the one sports community I try to talk about on here I try to talk about here. It's a big part of my life Is running and the Brighton Marathon Jim the organ is up the organizers the organizers they had an apology to give yes because They did the one thing you hate with marathons. Mm-hmm. It made it too long made it six football fields too long 670 yards too long Like a lot long. Do you think anyone gave up in that final period that final stretch? No But I think that they were bad. Well, the way it reads is they say one they say it was human error And it's like obviously and then Oh Said that twice it's like no one is blaming robots. It was just a case of human error. It's like the person Yeah, dude. Yeah, you You sit up the event man. So we're having this press conference But it says the mistake was spotted after runners were on the route and therefore cannot be rectified So I think it was literally like the little rascal scene when the a sign got flipped It's like go right instead of like stay straight and they just went through town Great little rascal scene and for the rest of next hour 20 minutes. We're just gonna play a little rascal's enjoy In not sports news we had to escapes from animals Zebras escaped in Maryland and people are Weirded out by it and they don't know how to catch them the county officials can't catch the zebras and their quote is you can't hunt them down They're just too fast. They run They won't let you get near them. So same as any other animal that's ever been Yeah, that quote was by Rodney Taylor chief of the PG What's he expecting we were hoping it was a slower It really got away from us. Yeah, dude. They escaped zebras are horses. I think they're closer to the zebras aren't a horse What are we doing?  Yeah Thanks for having me Google. Well the zebra a horse another horse escaped a racetrack Which is always a fun story in the video of it on the highway I don't care about that story at all. I just lumped it in because it was the same same animal not the same animal Scientists, why don't we get a zebra and a horse put them next to each other and you tell me they're not related? Those are called sources. It's the employee of the week. It's the employee of the week It's the horse. It's not a horse. It's a sheep. No Think so Didn't look this guy's very gentle to horse animals. You know what? I don't know about that You don't think former Mets reliever Jerry Blevins is nice to animals. No, that's what I said That's all I said. I think it starts. I think when they're sharing the same ground. He's very nice to horses But when he's riding one, he makes sure they know who's in control So this is gonna be a tough employer to reach a Jerry Blevins Shea station Mets they won they beat the Yankees they yelled part of the reason I don't like Do a whistle noise don't do this just let them hear that. Oh cover it with a whistle noise Jerry looks good in ways. I can never look good. He's tall skinny and has great hair exactly So he's got in a bag of granola leaking farts, right People are happy with his granola farts like they've come to him, but dude He could also when we're doing all that worse walking around doing granola farts people like that makes sense Yeah, you I got nothing. It's like stop. It's not working Yeah, he could also do like if he was riding a horse aggressively like you'd be like, yeah, that's what I'm saying Yeah, but that's kind of range That I'll never have thanks for watching everyone Support for this program was brought to you by Manscape.


A renowned cleric and convener of the coalition for a better and brighter Nigeria, Prophet Issa Elbuba, has expressed deep concerns over renewed killings in some parts of the country, describing them as despicable and saying they must be condemned by all. He made this known in just the pletestate capital, while leading a peaceful prayer protest, demanding an end to the killings. The revelation by international society for civil liberties and the rule of law in the society that Nigeria led the world is present here for the sake of the 2022, with a percentage number of 5,104 deaths and more than 3,023 seconds under certain 2022 calls for concern and the over 12,000 minority Muslims that were killed and dissolved in their homes and locked down. We have imagined for a smarter effort to apart what you saw going in our days. Thank you for watching.


One of the issues that often comes up this week, particularly when discussing political economy or libertarian theory, people often ask, well, that's a really interesting theory, but that could never work in practice. Right? I mean, how could you really have free markets doing X, Y, or Z? Or if we didn't have the government doing this, how could we possibly survive? And probably you've attended several talks already this week that have addressed these kinds of objections, providing some examples of how things might actually work in practice. What I want to do this afternoon is address sort of a similar question, but about Austrian economics more generally. In other words, people often say, boy, you Austrians are really into your theory. You do praxeology. You have all this deductive reasoning. You spin out these long sort of complicated ideas.  I mean, who could possibly get through all these pages? And there's, you know, in human action, there are some historical illustrations, but this is really a theory book. And man economy in state is almost entirely a theory book. Is there anything practical that you can get out of Austrian economic theory for day-to-day life, and in particular for business, for commerce, for management, and so forth? Now I teach in a business school, and I teach principles of Austrian economics to business students and to business professionals, to executives, all kinds of practitioners, members of the community, and so forth. And I've found that business professionals are very receptive to the theories and concepts and arguments provided by Austrian economics. In fact, I would argue that Austrian economics is even more of a practical subject than other kinds of economics. Right? Why do I say this? Don't think about how Austrian economic theory differs from the economic theories you get in most of the textbooks, most of the university classrooms, analyses on TV, and so forth, sort of mainstream neoclassical economics. Well, as we've already discussed this week, the Austrians have a particular way of approaching markets and prices that is causal and realistic. Right? We're not using mathematical equations to try to solve for some kind of equilibrium conditions. We're trying to explain the actual prices and other phenomena that we observe in the market and trying to explain them using in terms of cause and effect. Right? Why did these prices go up? Why did this industry succeed while some other industry did not? Why was this entrepreneur more successful than some other entrepreneur, and so on? We have this very practical emphasis on firm and resource heterogeneity. One of the first things you learn in your intro undergrad econ class is, well, let's start with a model of identical consumers and identical producers engaged in perfect competition. You know, okay, 18 and 19-year-old freshmen, their eyes will glaze over a little bit, but they will dutifully take notes and regurgitate this material back to the professor on the exam. But try doing an executive MBA seminar and say, well, let's imagine a world of identical homogeneous firms. By the way, we'll make it an infinite number of them so we can do all this in the limit and make the math work out. I mean, they're already out the door at that point. Austrian economics emphasizes that people are different, that firms are different. Resources are different. We don't have schmoo capital, as Roger Garrison was describing it. We talk about actual discrete goods and services that are used by producers to make stuff. We point out that the attributes of resources are not given by their objective characteristics, but by the way they are perceived subjectively by consumers and by entrepreneurs. The value of a machine to an entrepreneur is not determined by its physical characteristics, but by its place in the entrepreneur's subjective production plan. Anybody who's been an entrepreneur, anyone who has tried to use productive resources to make goods and services to sell to consumers will know exactly what this means. Business firms are not mathematical abstractions. We don't have one equation that represents the firm, right? Rather, we regard firms as bundles of heterogeneous resources. And if you go to a factory or a service business, what do you see? Bundles of heterogeneous resources, machines, inventory, workers, managers, and so forth. Okay, we discussed a little bit already on Monday the role of the entrepreneur in the Austrian system. Joe Salerno has described how entrepreneurs use economic calculation to plan and to evaluate the results of their actions. So the emphasis on uncertainty, on entrepreneurial judgment, on the importance of ownership of resources, the critical role of financial markets in the economic system, right? Again, these are all things that make perfect sense to business professionals, to business students, business practitioners, where they wouldn't say the same thing about the way, about the economics that they learned in some of their textbooks. So what I want to do in the next few minutes is just walk you through a series of examples or illustrations of some practical business and managerial topics in which Austrian economics provides some unique insight. Let's start with cost. Cost is a little bit, can be confusing in mainstream treatments of economic production and profit and so forth, right? So what you typically get in an economics course is some sort of, it really comes from Alfred Marshall, this kind of cost curve analysis of the firm's behavior, right? So for a given production technology, given prices of inputs, right? Firms can calculate an average cost curve and a marginal cost curve. And depending on market conditions, the firm will try to maximize its profits by producing where marginal revenue is equal to marginal cost and so forth. Most of you are familiar with this kind of analysis from courses that you've taken or maybe other things that you've seen. The problem with the standard approach to costs and by extension profit maximization is the idea that costs are exogenous. In other words, that costs are fixed and external to the firm. The plant manager wakes up in the morning and looks to see, ah, what is the price of labor today? What's the price of this particular input? What's the price of that input? And then he sort of calculates, oh, well, if I produce 25 units, my costs are going to be $500. If I produce 26 units, my costs are going to be $520. Let me compare that to my marginal revenue and decide what I want to do, how much I want to produce, okay? So the idea is that firms and managers are kind of responding to costs. Now, where do these costs come from, right? What determines the costs? Tom Woods referenced this briefly in his opening talk on Sunday night, right? Of course, we cannot explain firm behavior. We cannot explain market outcomes starting with the assumption that costs come from somewhere else. Because we need first to explain, well, where do these costs come from? Because costs are prices, right? Cost is another word for the price that the producer pays in the market for goods and services, or that we as consumers pay for things that we consume, right? We all understand, you know, how much did it cost to buy that Big Mac? Well, that's the market price of Big Macs. And that's, I exchanged that many dollars for a Big Mac in the market. We say, well, but what's the price? What are McDonald's costs to produce those Big Macs? Well, that's the price that is paid in the market for beef and hamburger buns and fast food workers and electricity and so forth, right? So costs are just prices as seen from the producer's point of view. And the key sort of Austrian subjectivist point is that all costs ultimately are opportunity costs. All costs are opportunity costs, meaning that, you know, when we say, well, it costs McDonald's so many dollars to produce this many Big Macs, what we mean is McDonald's or someone in the economy is not enjoying the benefits of some other goods and services that could have been produced and sold, had the hamburger meat, the cows, the feed for the cows, the land on which the cows graze and so forth, and all the other ingredients not been used for something else, right? So costs are values foregone. What we need to try to figure out is how do we translate these values foregone into dollars that represent the accounting costs that are paid by producers, OK? So a few things to think about here. You know, first of all, the entrepreneur sometimes has control over individual factor prices. So, you know, if I'm just a mom and pop operator, I set up shop here in Auburn, Alabama, and, you know, I want to, I'm just a food truck. I'm going to make hamburgers. I buy hamburger meat. You know, I may not be able to exercise much bargaining power over the price that I pay for hamburger meat. It's kind of a generic commodity. There are lots of people in Auburn who want to buy hamburger meat. And it's not like I can go down to Walmart or Kroger or the local grocery store and say, yeah, you know, two ninety-nine a pound is a little high for me. I would you take one fifty, right?  But now it may be that I'm buying from a small vendor. Maybe I'm buying organic grass fed beef from this one farmer. And we actually do sit down and negotiate over the price. And of course, if I am a large buyer, if I am the McDonald's Corporation, right, assuming I'm not vertically integrated and I don't own my own cows, I have a lot of buying power in the market for beef. In fact, it's the small farmers who feel like, you know, they're sort of taking the price that is set by McDonald's rather than McDonald's having to take the price of beef as being given somewhere else. OK, so many times the entrepreneur actually can influence the price that is paid for some or all the inputs and thus have influence over the cost that is paid by that entrepreneur, right? But all entrepreneurs can influence the prices of their inputs indirectly through their choices of production methods. OK, so just as we say, look, when I Peter Klein go to Walmart to buy a tube of toothpaste, I don't bargain, right? I just sort of take the price as given either by toothpaste or not.  Walmart will realize lower revenues from selling that toothpaste and they'll decide, you know, they might they either have to lower the price or get rid of that product altogether, right? So of course, an individual consumer may not have a lot of influence over the price of toothpaste of a tube of toothpaste. But of course, it's still the case that the price of toothpaste is set by the supply and demand for toothpaste. Likewise, a mom and pop operator, you know, the guy who operates a little food truck may not be able to influence directly the price of hamburger meat by trying to bargain with a large meat supplier. Right, but I could always choose to use a different kind of meat. I could choose to locate in a different area. I could choose to sell chicken sandwiches instead of hamburgers. I could use, you know, I could sell tofu burgers. I could switch to an organic or non-organic or grass fed or whatever. Right, there are lots of different ways that I can make sandwiches or burgers or food or however we want to define the product that I'm selling. And thus, I am exercising some influence on the price of my inputs in this indirect fashion. OK, so in other words, the prices of factors are determined in markets for those factors, just as the price of a consumer good is determined in the market for that consumer good. And we can use the causal realistic principles of pricing to explain factor prices, just as we explain other prices. Great source on this is a book by James Buchanan called Cost and Choice, which provides a very sort of forceful critique of the neoclassical cost curve approach, which starts by assuming exogenous cost and then goes on to derive firm behavior. OK, you know, cost sounds boring, except for your accountants in the room. You're boring anyway. Normal people think that cost is pretty boring. But actually, if you think about it, cost accounting is really central to Austrian theory. Think about Mies's argument on the impossibility of rational economic planning under socialism. It's usually described as, you know, Mies is showing why socialism doesn't work because you don't have private property. And so social planner doesn't have any way to know if it's more you know, if it's more rational or efficient to build a railroad here or build a railroad there or not build a railroad at all and so forth. But really Mies's argument about socialism is not essentially about socialism. The impossibility of rational economic planning under socialism is just an application. It's really a cost accounting argument. It's really an argument that rational economic decision making requires the use of numbers, right? You have to have some way to estimate what is the total cost of, you know, choosing course of action A versus course of action B so that I can compare A and B as a producer, right, as an organizer of production. And I can't add up heterogeneous units of factories and machines and tools and workers to come up with a meaningful, aggregate number. I need some unit of comparison. In other words, I need prices.  I mean, this Mies's point is that, well, the socialist planner, this is impossible under socialism because you don't have private property for factors, therefore you don't have markets for factors, therefore you don't have prices for factors, therefore you can have no meaningful cardinal numbers to stick into your computation. But essentially what Mies's is saying is that in a market economy, you need prices for resources, prices for factors of production so that entrepreneurs can calculate costs and revenues. OK, it's really an essay on cost accounting. There's a really good section on this in Mies's little book, Bureaucracy, which is not one of his most highly read books, but it's one that I would recommend. I mean, for one thing, it's short, it's easy to read, and it contains a nice summary of some of Mies's major arguments, particularly on this point. He has this great way of expressing the calculation problem. And it's something like Mies's says, you know, in a capitalist economy, by means of their prices on the market, resources, factors, it's like they're shouting out to the entrepreneur, use me or use me here. Don't use me, use me there. And he says, you know, under socialism, the factors of production are mute. OK, they don't speak because there are no prices in which they don't have prices. But it's a very nice summary of the calculation argument in a way that I think is actually a little bit clearer than the summary you get in his book on socialism or even in human action. In particular, it's in the section where Mies's distinguishes what he calls profit management from bureaucratic management. And Mies's is talking about large complex organizations with multiple subunits or subsidiaries or divisions. And he points out that, you know, in order to manage a large complex organization, a certain amount of decentralization or delegation is required. Mies's says, look, under capitalism, you know, the central managers of the firm can say to each subsidiary or each subunit, look, we'll give you a lot of discretion to manage your affairs as you see fit. We will look at the net contribution to total profit made by your division or your subsidiary and evaluate you in that light. Right. So if it's, you know, imagine that the Mies's Institute were a for-profit organization, you might have a book publishing subsidiary and a online education subsidiary and a merchandise subsidiary. Each one can have its own income statement, right? Its own statements of profits and losses and the central management can use those divisional income statements to decide, you know, should we really be even really be in the book publishing business or not? Well, book publishing is not contributing very much to our bottom line compared to doing online education. Therefore, we should shift more of our activity from books to online education. Mies's says, well, could you use this kind of a system in a government setting? So for example, take the police department. So the police department has, you know, beat cops on the street who are patrolling the street and it has detectives who investigate solving other kinds of crimes and their public relations, things that the police department does and so forth. How should the police department allocate its resources across these different activities? How do you evaluate the effectiveness of these different activities? Well, you can't use profit and loss, right? Because the goods and services, if they are valuable, that are produced by the police department, they're not bought and sold in markets. So there's no there's no market price for policing services. And so there's no way to know whether a particular activity is contributing to the bottom line or not, because there is no bottom line, right? The police department does not produce things that it then sells on the market. There's no market test.  And each division will get more resources and will get rewarded based on how it meets this criterion and promotions for individual officers will be based on this performance criterion. OK, I mean, you can imagine the result that you would see, we see this already, right? We all know, you know, be extra careful not to speed when it's near the end of the budget cycle or end of the month, you know, when don't speed through certain little communities where they're known to be profit maximizers, revenue maximizers, right? Mises doesn't claim that policing is illegitimate or that, you know, the government, he doesn't even claim that the government shouldn't provide police services, but he says they can't manage their operations in this decentralized fashion that private entrepreneurs can because they don't have profit loss signals, there's no market test. OK, Mises recognizes that even in a private company, you have some challenges, for example, how to allocate overhead cost among different activities, but this is something that, you know, entrepreneurs are figuring out as firms compete with each other. There are some interesting recent work on accounting principles from an Austrian perspective, for example, there's a Thomas Taylor article, because it's 15 years old now, talking about accounting practices as kind of social constructs or social conventions, and he offers a kind of Hayekian evolutionary argument for how particular conventions come to be established, like activity-based costing or EVA and so forth. There are a lot of new accounting practices that come into fashion. And Taylor says we can explain these as attempts by market participants to come up with reasonable social conventions that allow them to solve certain kinds of coordination problems. You know, I spoke on Monday and I guess all of you were there because it was a because it was required on entrepreneurship. So I don't need to say much more about that. But just to remind you that, you know, in in a kind of a long run equilibrium state, we still have earnings for factors. We have interest payments to capitalists, but we don't have entrepreneurial profit and loss because there's no uncertainty. Right. But on a day to day basis, in the real world, entrepreneurs earn profits and losses based on their ability to anticipate future prices and market conditions. And the unique role of the entrepreneur is to arrange the factors of production under uncertainty, which is not quite the same thing as innovation or discovery, but rather it's something that implies ownership and judgment. Now, this is extremely practical because that's exactly what resource owners do. It's exact. This is exactly how entrepreneurs behave. Just to remind you, right, Austrian economics helps us to see what profit is not. OK, so profit is not interest. Profit and interest are both financial returns to business owners. I mean, they're dollars. Right. If I'm a business owner, I get these dollars in my pocket after I've paid out all my factors.  But analytically, we understand that there can be different sources from those dollars, right? So to the extent that, you know, part of that business income comes from the fact that when I pay for my factors, I'm paying a discount relative to their marginal revenue product because I'm paying them upfront and I'm only receiving the returns from selling my output later. And so I'm getting an interest return, right, to compensate my factor owners for time preference, right? Basically, I'm lending them some money ahead of time before they've produced something that I can actually sell and I get an interest return for doing so, right? But that's that's different from the part of my business income that comes from being able to buy some factors at prices that are below their realized discounted marginal revenue products. And I get losses to the extent that I pay for factors more than what I will eventually get a discounted marginal revenue product. And again, to see this, you can imagine a world in which there is no uncertainty about the future, but you still have the passage of time and time preference. So business owners would still earn interest in the evenly rotating economy. But there would be no profits and losses, right? So, of course, income in an economic sense is not exactly the same thing as income in an accounting sense, right? Accounting income includes profit, interest and the entrepreneur's implicit wage. So when we talk about profit in an economic sense, we're thinking of profit as a functional category as a reward to successful uncertainty bearing. But you don't see that on the income statement. OK, accounting majors, there's just net accounting income. There's total revenues minus total costs. Analytically, you have to try to conceptually separate that net income into interest, implicit wage and profit. But those things don't show up as line items on the income statement, right? Profit is not an automatic return to capital, which some people seem to think. Some economists seem to think, oh, well, if you have capital, you know, capital is like a banana tree, produces a certain number of bananas per year, just automatically. So if you own some capital, it just sort of spits out some interest. That doesn't make any sense. I think Roger Garrison had some discussion of that. And profit is not a markup over production costs. Is this what people think? Oh, well, the way you make money in business, I'm going to produce whatever I'm going to produce books. And, you know, here's how much it costs me to produce a book. I add 15 percent and send it out into the market. And that's where my income, that's where my profit comes from. Now, I mean, look, sellers are free to add whatever markups they want to goods and services they sell. That doesn't mean anybody is going to pay that, right? The price that's paid is determined by supply and demand. The actual market price depends on supply and demand. Of course, the seller can post whatever price he or she wants, but that doesn't mean that's the price that you will actually receive for selling your goods and services. OK, I just briefly talk about business strategy. There's lots of literature on this by economists and by other kinds of scholars. You know, strategy is really about inter-firm performance differences. Why do some firms perform better than others? And the dominant approach to business strategy is what is often called the positioning approach. Derives mainly from the research by Michael Porter. And essentially, it's neoclassical monopoly theory or neoclassical industrial organization economics sort of flipped around. So in standard neoclassical monopoly analysis, it's explained that monopoly is harmful because there's inefficiency and dead weight loss and so forth and perfect competition in which firms don't earn any profit is better from society's point of view. Well, Porter took that conventional analysis of monopoly and competition and said, OK, but what if I'm the monopolist or I'm a would be monopolist? Right? I don't care about efficiency. I don't care about social welfare.  OK, and if monopoly theory says, well, when you have barriers to entry, then you have a downward sloping demand curve instead of a horizontal demand curve and their monopoly profits to be made. I'm like, yes, I want that. OK, how do I create barriers to entry?  Try to differentiate your product from that of rivals so you can get some monopoly power, you can try to engage in predatory conduct, try to drive your rival out of business so then you can be left as the winner in the market. I mean, so the idea in Porter's strategic positioning approach is that the way to make money is to outmaneuver your rival, you know, kind of like in a like in a military conflict, outflank your rival and drive your rival into the ocean, you know, through your advertising and your product differentiation and so forth, intellectual property, etc. There's not much role for Austrian concepts like uncertainty and entrepreneurship and actual competition as opposed to textbook, perfect competition in those kinds of models. Now, in recent years, there's been some challenge or critique of the Porter approach by what is sometimes called resource-based or capabilities approaches or theories to strategy. We'll say that, no, really, why some firms perform better than others is because those firms have better resources and better capabilities or competencies than their rivals. OK, so when you hear people talk about the core competence of an organization, a company, this is the kind of thing that they have in mind. So it's different from Porter in that instead of emphasizing, you know, trying to gain monopoly power, you're trying to acquire critical resources that other firms don't have and use those to attract customers to your products as opposed to those of your rivals. Now, in many ways, I think this is an improvement over the Porter approach. But it's still essentially based on neoclassical competition theory with just just focusing on factor markets rather than product markets. OK, so the idea is under perfect competition, there will be no unique resources or capabilities. All firms would be able to produce exactly the same thing. So firms are trying to create or exploit some kind of friction or imperfection in the factor markets where you can get a better resource or a better combination of resource than your rivals. Well, Austrian economics offer some some additional insight into strategy that is particularly useful. One is to focus on the role of the entrepreneur. Right, entrepreneurs differ in their ability to engage in production, to appraise and combine resources in anticipation of profits and so forth. Right, so the superior financial performance of companies is ultimately attributable to the superior entrepreneurial judgment of entrepreneurs who are responsible for those companies. OK, remember, entrepreneurial judgment can be better or worse. It can be it can be good or bad. It can be strong or it can be poor. Right, and when entrepreneurs are good at what they do, they earn profits as opposed to losses. OK, so and there's an emerging literature, academic literature in what's called strategic entrepreneurship, which is trying to take the insights from entrepreneurship theory and apply them to business strategy, trying to explain, inter-firm performance differences in terms of differential entrepreneurial judgment or differential quality of entrepreneurial judgment. Another advantage of attractive feature of this approach for us is that it places the emphasis where it belongs on subjective consumer preference. Right, what entrepreneurs are trying to do is anticipate the needs, desires, wishes, beliefs of consumers. So Apple is one of the great companies of the late 20th century. And Steve Jobs is a great entrepreneur. But, you know, there's a famous statement attributed to Steve Jobs that has that I think has been very misleading to people who study entrepreneurship and strategy. And that's you might remember Jobs supposedly said, you know, well, at Apple, we don't do we don't do marketing research. We don't do we don't do surveys, focus groups, because the consumer doesn't know what he wants until we tell him. In other words, we're so innovative. We we introduce these brand new things into the market and then everybody wants them. Right, but we can't ask people in advance. How do you think do you how much would you be willing to pay for for X? Because they've never seen an X before. OK, I mean, some of this is a little exaggeration on Steve Jobs's part. Right, but this kind of reasoning has led a lot of people, especially in the tech sector, to think, well, look, I mean, consumer preference really doesn't matter. It's about introducing the coolest, techiest, geekiest, most awesomest thing app or piece of hardware or service. And then, of course, it's going to go viral and I'm going to become a bazillionaire. OK, but of course, that's silly if you think about it for even five seconds, because of only a very tiny fraction of the apps and products and so forth that are introduced actually do become profitable, let alone become highly profitable. So, yeah, in hindsight, it's easy to look at Apple products and say, well, hey, they just pushed the market in a direction that it never would have gone otherwise, right? But I mean, if consumers just if consumers didn't like those products, then it wouldn't be the case that they wouldn't have been successful. Steve Jobs cannot just create demand on his own. He, like every entrepreneur, is trying to anticipate what consumers will ultimately be willing to do. OK. A brief note because students often ask about this, you know, what about game theory? So a lot of research and strategy, especially research and strategy that's done by economists, emphasizes game theory as kind of a tool for formalizing strategic interaction. Most of you have you've seen the prisoner's dilemma and other kinds of examples where game theory is used to understand interaction. You know, as Austrians, should we reject game theory as a tool for understanding strategy because of various objections to use of mathematics that that that you know already? Well, I want to give a qualified answer to this and say that. Used properly, a little bit of game theory, in my opinion, can is perfectly legitimate. Right. As long as we restrict ourselves to, you know, sticking to our core principles like. You know, that that utility is ordinal rather than cardinal, that we don't make interpersonal comparisons of well-being and so forth. So really, if you think about it, the standard kind of prisoner's dilemma analysis can be done in a pretty qualitative and ordinal way. Right. You actually don't need numbers to put in the little cells of the prisoner's dilemma to solve for the Nash equilibrium. You just need it to be the case that for this player, this payoff is higher than this payoff and this payoff is higher than this payoff. You just need a series of ordinal relations and they could be really subjective in the minds of the decision makers. Right. Now, how useful that is to analyzing a particular case depends on the circumstances, but simply writing down a little prisoner's dilemma matrix and putting numbers in there to represent the rank ordering of the players does not violate any Misesi and precepts about subjective utility or ordinality and so forth. Now, if you a lot of things that game theorists will then do, like, you know, try to add up these numbers over time through repeated plays or add some risk and then calculate expected values and so forth where the cardinality does play a role and we should be wary of doing that. Right. But the kind of intuitive logic of some of these games, I think, is not on its face objectionable in any way. In fact, I mean, sometimes trying to analyze strategic interaction using game theory can help us kind of think more systematically about what about the problem at hand, you know, again, keeping in mind that the whole point of using these kind of models is to show that there's an interdependence between joint actions and outcomes. In other words, you know, my sort of well-being is not only determined by the choices that I make and the actions that I take, but also the actions that other people, my competitors, my customers, my suppliers, others with whom I interact, are also making. Right. Of course, the same thing for, you know, for Apple. Apple's profit is not only determined by the entrepreneurial judgment of Steve Jobs or Tim Cook or whoever, but also by the actions of other entrepreneurs who are also exercising entrepreneurial judgment. There's an interdependence of judgment and action that explains the profits and losses that are experienced by different companies. Okay. Again, thinking about the characteristics of these firms, what are their objectives? What are their capabilities? You know, what's the sort of the timing of the interaction? What do certain people know and when do they know it and so forth? You know, and even Nash Equilibrium per se is not objectionable from an Austrian point of view. Again, as long as we're keeping things at a kind of a conceptual and, you know, ordinal level, I think using game theory is perfectly fine. Let me let me wrap up with some comments on the theory of the firm before we stop. As I mentioned before, in a lot of economics textbooks, the firm is represented by a production function.  Y is equal to F of X1, X2, X3, X4 or however many inputs you have. Y is output. And then you can, you know, you can use calculus on this production function to derive costs and so forth. You know, again, any any any business professional is going to look at production functions and cost curves and just laugh. I mean, it's not like you could hire yourself out as a consultant after taking a couple of economics classes as your university and say, oh, I'm going to go I'm going to go to Apple or or Xerox or General Motors or whatever and say, hey, if you'll show me your production function, I can do some math on it. Let me see your cost curves and I'll tell you how to maximize profit. Draw this curve, draw that curve. Here's where they cross. Yeah, I'm done. Here's my consulting bill. You know, pay me ten thousand dollars. I mean, again, this would be a call security. You know, this would be a security kind of moment. They would throw you out right away. That analysis is completely useless, you know, to actual managers, right? Austrians don't view the firm as a as an equation, right? But but again, in terms of resources, tangible and intangible or assets that are owned by those entrepreneurs who own the firm, right? What is a firm? A firm is a capitalist entrepreneur. Walter Block used that term capitalist entrepreneur. Or it could be a team of capitalist entrepreneurs, plus the assets that they own, right, the alienable assets. In other words, assets that you can buy and sell in markets. The reputation is not an alienable asset, for example. That's what a firm is. Firm is a is an entrepreneur or an entrepreneurial team, plus the resources or assets that are owned by the entrepreneur or entrepreneurs. Ownership conveys authority. Right. You have the right to decide how these resources will be used in particular context. Again, a firm as in this sense is not the same thing as a production function or a production process. A firm can own multiple production processes. Multi-divisional firm, multi-product firm or actually a firm could not own any, cannot control any production processes on its own, but could contract with other firms to jointly produce different goods and services. And I have a paper that on firm size that you might find interesting. I published in 1996 using Mises calculation argument to explain the limits to firm size in terms of sort of the language that we used before. I'll let you check that out if you're interested. Something else that Austrian economics helps us to see is it gives us some insights into organizational design. So by organizational design, I mean things like within a firm or within a company, how are decisions made, who has authority to make certain kinds of decisions, how are people compensated and motivated or incentivized, how is performance evaluated? I mean, you can already see, for example, an analogy between how decision authority is assigned and the notion of property rights in a market economy. Right? So I have authority over the property that I own. Within an organization, if my boss delegates some decision authority to me, it's kind of like I have property rights. I don't exactly have property rights because the boss still owns the building and owns the machines that I'm using and owns the desk at which I'm sitting. But I have this little realm of authority within which I can kind of make my own decisions without a lot of oversight. And that, you know, giving me that sort of pseudo property right gives me incentives the same way that real property rights give you incentives to take care of the things that you own. You can put a Hayekian spin on this and say, well, you know, the decision to decentralize, to delegate decision authority to lower levels of the hierarchy can be explained in terms of tacit knowledge, Hayek's concept of tacit knowledge. Great article on this by two non-Austrian writers, Michael Jensen and William Meckling, it's called Specific and General Knowledge and Organizational Structure, is one of my favorite Austrian articles, even though it's not explicitly Austrian that they do they do discuss Hayek. And they argue that, look, you know, in a large organization, the people at the top don't have all of the knowledge that's necessary to make good decisions throughout the organization. People at lower levels of the hierarchy have knowledge that is important and useful and that knowledge may be tacit. The term they use is specific, difficult to articulate, difficult to transfer explicitly up the line. So therefore it makes sense to give decision authority to people who already have the necessary specific knowledge. In other words, to have sort of a flattened hierarchy or to use their language, a co-location of decision rights and specific knowledge. It's a very Hayekian argument for a particular kind of organization that's looser and more decentralized. I need to stop. I'll just mention that it's possible to go too far here. Some Austrian economists, I think, have said, well, we're for the free market. We don't like authority and hierarchy from the government. Therefore, we don't like authority and hierarchy in the private sector either. And all firms should be, you know, organized along sort of principles of the sharing economy. And everybody should be an independent contractor. We don't need any large companies or or private large private companies or essentially status. I don't accept that line of argument at all. I've got an article you could look at came out two years ago called Why Managers Still Matter, arguing that the flattening hierarchy is kind of a myth. But you can talk about we can talk about that in the Q&A. So to summarize, Austrian economics is useful for management. It's different from other kinds of economics. And it's causal realism, its emphasis on resource heterogeneity, the role it gives to demand and the consumer and the central position played by the entrepreneur. I mean, it's qualitative theory. Austrian economic theory is qualitative, but it can be useful to people like forecasters who are engaged in the business of trying to anticipate quantitative relationships. But ultimately, at the end of the day, right, management is not praxeology. Principles that are useful to managers are not the same thing as, you know, Mises, apedictically true laws. Because ultimately, management is more of an art than science. But just as, you know, the theory of color is useful to a painter, understanding Austrian economic theory can be very useful to the manager. OK, thank you.