The discussion of the disordered soul continues with a reflection on the Stanley Milgram’s famous studies, in which participants were directed to perform harmful actions that ran counter to their reflective moral commitments. Interestingly, such demands were more likely followed when the commander was closer to the subject and the victim further away. What is it about proximity to others that has this effect on us?

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 poll of the class about whether students have elected to take a voluntary no-Internet pledge, and distributes stickers to help students who have made the pledge stick to their resolve. She then moves to the substantive part of the lecture, where she introduces Plato’s analogy between the city-state and the soul and articulates Plato’s response to Glaucon’s challenge: justice is a kind of health--the well-ordered working of each of the parts of the individual—and thus is intrinsically valuable.

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.

Professor Gendler reviews four instances of intrapersonal divisions that have appeared in philosophy, literature, psychology, and neuroscience: Plato's division between reason, spirit, and appetite; Hume's division between reason and passion; Freud's division between id, ego, and superego; and four divisions discussed by Jonathan Haidt (mind/body, left brain/right brain, old brain/new brain, and controlled/automatic thought). A discussion of a particularly vivid passage from Plato's Phaedrus concludes the lecture.

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.

The final exam was administered in class.

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 Summers, former U. S. Treasury Secretary and former President of Harvard University, in this the first of two lectures in honor of former Yale Professor and Council of Economic Advisors chairman Arthur Okun, offers thoughts on the role of monetary policy in economic fluctuations, past and present. In the "Okun period," ending about when Okun died in 1980, the monetary authorities were very much involved in actually creating economic contractions. Inflation would repeatedly get out of control, the Fed would hit the brakes, and the economy would slow.

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.