Professor Gendler introduces Aristotle’s conception of virtue as a structuring one’s life so that one’s instinctive responses line up with one’s reflective commitments. Becoming virtuous, according to Aristotle, requires that we engage in a process of habituation by acting as if we were virtuous, just as musicians master their instruments by playing them. By contrast, when one’s behavior or experience is out of line with one’s reflective commitments, dissonance ensues.

Professor Gendler begins with a demonstration of sampling bias and a discussion of the problems it raises for empirical psychology. The lecture then returns to divisions of the soul, focusing on examples from contemporary research. The first are dual-processing accounts of cognition, which are introduced along with a discussion of the Wason selection task and belief biases. Next, the influential research of Kahneman and Tversky on heuristics and biases is introduced alongside the famous Asian disease experiment.

After introducing Plato’s Republic, Professor Gendler turns to the discussion of Glaucon’s challenge in Book II. Glaucon challenges Socrates to defend his claim that acting justly (morally) is valuable in itself, not merely as a means to some other end (in this case, the reputation one gets from seeming just). To bolster the opposing position–that acting justly is only valuable as a means to attaining a good reputation–Glaucon sketches the thought experiment of the Ring of Gyges.

In the second of his two lectures in honor of Arthur Okun, Professor Summers points out that real interest rates have been very low in the current subprime crisis. This indicates that the shock to the economy was more a financial breakdown shock than a disinflation shock. But financial breakdown shocks are not necessarily very harmful to the economy, so long as financial intermediation capital is not destroyed.

Professor Shiller, in his final lecture, reviews some of the most important tools for individual risk management. Significant inequality in domestic and international communities has created a need for social insurance programs, such as those created in Germany in the late 1800s. The tax system, bankruptcy laws, and government insurance programs are used to manage risk of personal wealth.