Category: Ec101

EC101: Links for 17th October, 2019

  1. “In order to combat global poverty, we must identify the most effective forms of action. This year’s Laureates have shown how the problem of global poverty can be tackled by breaking it down into a number of smaller – but more precise – questions at individual or group levels. They then answer each of these using a specially designed field experiment. Over just twenty years, this approach has
    completely reshaped research in the field known as development economics. This new research is now delivering a steady flow of concrete results, helping to alleviate the problems of global poverty.”
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    A simple primer on the work that Duflo, Benerjee and Kremer have won the Nobel Prize for.
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  2. “The first general comment is the idea of randomisation is hardly anything new for researchers who have studied or followed Indian development. The Planning Commission started something called Programme Evaluation Studies way back in 1954 which more or less studied the same thing. Agriculturists — both practitioners and researchers — have also used similar techniques of RCT to see what agricultural intervention worked.In my own research on banking history, I saw how Syndicate Bank started programmes on agricultural and rural development based on near similar ideas of randomisation. To be fair, the 2019 laureates have advanced these ideas using techniques from sampling, statistics, and econometrics to draw finer inferences.”
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    Amol Agarwal over at Moneycontrol points out a more nuanced understanding of both this year’s Nobel Prize as well as the Nobel Prize for Economics in general. Well worth reading!
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  3. The NYT profile on this year’s Nobel Prize.
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  4. “The significance of what Angrist and Pischke termed the “credibility revolution in empirical economics” can be seen in the John Bates Clark Medal awards given to researchers who participated in that revolution. Between 1995 and 2015, of the fourteen Clark Medal winners, by my estimate at least seven (Card, Levitt, Duflo, Finkelstein, Chetty, Gentzkow, and Fryer) are known for their empirical work using research designs intended to avoid the problems that Leamer highlighted with the multiple-regression approach.”
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    Mostly for those truly interested in economics, but Arnold Kling points out how more people should know about Ed Leamer.
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  5. Heavily, heavily recommended: this is the longer version of the first link above, again by the Nobel Prize committee itself.

EC101: Links for 10th October, 2019

  1. “Coase’s originality was not in his reasoning, but in recognizing that economic exchange is not the mere trading of physical goods but trading rights to property or rights to engage in certain types of conduct affecting property.”
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    Was Ronald Coase the first to come up with the Coase theorem?
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  2. “However, the joy of this book is less in the big picture than in the detail. And what a lot of it! The mind boggles at Smil’s extensive reading and absorption of information. We get the speed at which marathons are run – over the entire course of human history; the growth rates of piglets and weight of chicekns over time; sales of small non-industrial motors over time; the envelope for the maximum speed of travel; Kuznets cycles; Zipf’s law for city size…. The middle section of chapters offer a fantastic overview of technical progress over long periods in a wide range of technologies. I love all this detail.”
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    Diane Coyle thoroughly approves of Growth and Civilization.
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  3. “When a daughter is married, we do worry about her future. But why should I worry when the government of India is my son-in-law who married my daughter Syndicate Bank,” asked the late Tonse Madhav Ananth Pai in 1969, in the aftermath of the nationalization of the first-generation private-sector banks. Fondly known as “Brahma of Manipal”, Pai was the founding father of Syndicate Bank in 1925.”
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    A lovely read on bank mergers, bank nationalization and banks from a particular part of Karnataka.
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  4. “This is where the popcorn enters the picture. Pricey popcorn makes those lower ticket prices possible, And that is why you should buy popcorn at the movies.”
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    Expensive popcorn? Uh, no, cheap movie tickets. Yes, really. Cheap for whom, you ask? Welcome to microeconomics.
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  5. “This leads to the question: Why try these markets at all? This is quite similar to creation of super highways which help reach destinations much quicker but lead to accidents as well. Should we then not create highways?Policies always raise such trade-offs and hopefully, the regulator will take steps which minimise the negative aspect of creation of these markets.”
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    Amol Agarwal, in Moneycontrol, on securitization in real estate loans in India. Me, I think this is not such a great idea.

EC101: Links for 3rd October, 2019

  1. Everything is correlated.
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  2. For students at Gokhale Institute for sure, but elsewhere too: the Stiglitz essay prize.
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  3. Capitalim vs Socialism.
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  4. On reforming the PhD.
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  5. On complements, substitutes, YouTube and reading.

EC101: Links for 26th September, 2019

Five links about Martin Weitzman, who passed away recently.

  1. Notes from a seminar held in his honor when he retired, just over a year or so ago.
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  2. His reading list for the theory of central planning course that he used to teach at MIT
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  3. An appreciation of Martin Weitzman, by Ben Groom.
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  4. Alex Tabarrok on the Noah’s Ark problem.
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  5. The NYT obituary. I felt extraordinarily depressed upon reading it.

EC101: Links for 19th September, 2019

  1. Are we all Japan now?
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  2. A review of the Jalan comittee report.
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  3. Eric Maskin writes an appreciation of Kenneth Arrow’s ouevre.
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  4. A New Yorker profile of Stephanie Kelton.
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  5. Bookmarked as want to read.

EC101: Links for 12th September, 2019

Following on from my review of “Launching The Innovation Resistance”, here is a selection of five papers from its bibliography that I enjoyed going over.

  1. “Using a sample of engineered mice that are linked to specific scientific papers (some affected by the NIH agreements and some not), we implement a differences-in-differences estimator to evaluate how the level and type of follow-on research using these mice changes after the NIH-induced increase in openness. We find a significant increase in the level of follow-on research. Moreover, this increase is driven by a substantial increase in the rate of exploration of more diverse research paths. Overall, our findings highlight a neglected cost of IP: reductions in the diversity of experimentation that follows from a single idea.”
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    The title of the paper is much more entertaining: Of Mice and Academics(!)
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  2. Understanding patent thickets (Note: this is a JSTOR link, you may not be able to download the paper. If so, my apologies!)
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  3. The patent paradox revisited (Again, a JSTOR link)
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  4. On roses and patents (I really enjoyed reading about this in the book, and therefore this paper as well)
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  5. On the history of patent law.

EC101: Links for 5th September, 2019

All five links from Marginal Revolution today, in relation to a talk that was held at the Gokhale Institute yesterday, by Murali Neelakantan. This is a topic that I am becoming more interested in, so you might see more posts about this topic.

  1. “It is less commonly recognized by the critics, however, that tougher IP protection may induce more foreign direct investment. Why for instance invest in a country which might subject your patents and copyrights to an undesired form of compulsory licensing?”
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    A typically Cowenian (and by that I mean contrarian) statement, and therefore also likely to be at least somewhat true. MR on Why TPP in IP law is better than you think.
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  2. “It’s hard to believe that the extension of copyright for decades after an author’s death can appreciably increase artistic creation and innovation, thus the public has gained little from copyright extension. What has been lost?”
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    Alex Tabarrok on the tragedy of the anti-commons.
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  3. “Patents are supposed to increase the progress of the useful arts.”
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    Are patents out of control?
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  4. “Walt Disney was long-dead when his copyright to Mickey Mouse was extended. Rumors to the contrary, Walt ain’t coming back no matter how much we incentivize him with a longer copyright.”
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    Alex Tabarrok is rather exasperated with copyright protectionism.
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  5. “How can we increase innovation? I look at patents, prizes, education, immigration, regulation, trade and other levers of innovation policy.”
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    Alex Tabarrok’s blog post on his book, “Launching the Innovation Resistance”

EC101: Links for 29th August, 2019

  1. A simple explainer from the ToI about what RBI’s surplus funds are.
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  2. “Central bank balance sheets can be difficult to grasp and are the subject of much debate. This note makes the case that gross capital is large on RBI’s balance sheet (and further additions to the capital by way of retained earnings do not look necessary) but given the large government debt on the RBI’s books, it is difficult to justify any one-time standalone transfer to the government now.”
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    Ananth Narayan, writing about a year ago (close enough) on the advisability of handing over the funds to the GoI. A nuanced argument, and worth reading.
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  3. “So what you do is:      On the liability side, you reduce the provisions by a certain amount
    On the asset side, you cancel out some government bonds. What the government owes the RBI (as interest and principal) goes away into thin air.

    This gives the government the ability to issue more bonds (since it just saved a truckload on interest costs) and thus use that additional money to do different things.”
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    Deepak Shenoy on the same topic, again from a while back.
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  4. “The balance in the CF is about ₹2.32-lakh crore, which is around 6.4 per cent of the RBI’s total assets.This is reportedly much higher than the 2 per cent average that other BRICS nations (Brazil, Russia, China and South Africa) hold, according to a Bank of America Merrill Lynch report.”
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    The Hindu Business Line on how high the contingency funds are as a percentage of the balance sheet, and how high that number is in comparison to other economies.
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  5. “But there’s a danger, exemplified by Venezuela in the 1980s and 1990s. The central bank, pushed into insolvency by its support of the Latin American government’s industrial policy, leaned too heavily on the power of cheap money-printing to earn profits and repair its balance sheet, and lost control of inflation. Thinning out the Indian central bank’s capital cushion could introduce a similar vulnerability”
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    Andy Mukherjee plays devil’s advocate.

Etc: Links for 16th August, 2019

I have linked to brainpickings before, but this week, I have been reading it almost incessantly. For a variety of reasons, not the least of which is that I have economics textbooks coming out of my ears.

In particular, I have been reading about what Maria Popova has to say about Kurt Vonnegut – and that is a heady combination indeed. And so today’s links are five posts about Vonnegut by Popova (and a bonus sixth one at the end!)

  1. “I think it’s important to live in a nice country rather than a powerful one. Power makes everybody crazy.”
    An excerpt from a letter to his daughter.
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  2. “When I get home from school at about 5:30, I numb my twanging intellect with several belts of Scotch and water ($5.00/fifth at the State Liquor store, the only liquor store in town. There are loads of bars, though.), cook supper, read and listen to jazz (lots of good music on the radio here), slip off to sleep at ten.”
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    A part of his daily routine, as outlined to his wife.
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  3. “I have just demonstrated to you that Shakespeare was as poor a storyteller as any Arapaho.”
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    Hamlet from his viewpoint.
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  4. “Write to please just one person. If you open a window and make love to the world, so to speak, your story will get pneumonia.”
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    This was the second piece that I read this week about Vonnegut, and the advice about how to write better is masterful.
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  5. “Find a subject you care about and which you in your heart feel others should care about. It is this genuine caring, and not your games with language, which will be the most compelling and seductive element in your style.”
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    And this was the first.

And because it is Friday, and because why not, a short poem by Vonnegut.

EC101: Links for 15th August, 2019

Another student of mine, Amruuta, got in touch recently asking about fair valuation and how to think about it. That a) got me thinking about the topic, and b) going down a rabbit hole of articles about the topic. And you have her to thank for today’s lot 🙂

  1. This is (probably) why Amruuta got interested in the topic in the first place.
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  2. Bookmark, rather than read: a short explainer of the differences between the old and the new accounting standards. Note to readers: I am nowhere close to being more than a slightly informed layperson in this area. If anybody knows a more updated source, please let me know.
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  3. How to do valuations in the first place?
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  4. What is fair market value?
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  5. A blog post from Fred Wilson (who has scored a deserved hat-trick, by the way) on hands on valuation exercises. The spreadsheets alone are worth it.

 

Thanks, Amruuta! I learnt a fair bit myself.