Why is Growth Clumpy, and Should we Attempt to Change Its Clumpy Nature?

In last Wednesday’s post, I ended by saying this, in the context of recent scientific advancements:

But on a personal level, the past year has also taught me this, and I have Morgan Housel to thank for the central insight: the seeds of calm are planted by crazy.3
So when things are really bad and grim (and again, this is not over yet), look to the bright side. And not just because it’s a good thing to do! But also because the bright side is likely to be brighter precisely because of everything else being so goddamn dark.
Tomorrow, I’ll attempt to answer a question I have, and I am sure you do as well: why?

https://econforeverybody.com/2021/03/24/whats-up-with-the-world-outside-of-covid-19/

I didn’t write the follow-up post, not because I forgot to, but because I couldn’t figure out how to think through what to write about. It turns out that I am still not sure! But in this post I’ll try and tell you why I’m not sure, what I’ve been thinking about, and what I’ve started reading to help me think through aspects of growth.

First, I think I’ve understood the central message of Tyler Cowen’s Stubborn Attachments, and agree with it: growth matters.1

Which then begs the question: how should we promote more growth, and more learning?

More learning, for me, means dramatically changing (or perhaps entirely discarding) the way higher education is currently handled, and that’s something to think about for years to come.

More growth, for me, means trying to understand the nature of growth, why it occurs at all, how it occurs, and what factors contribute to and hamper growth. And this topic is, well, a rather large one. It is large in terms of building out an edifice around which I can attempt to learn more about the subject, let alone the actual learning itself.

Here is what I mean by that: when I think about growth, and find myself wanting to learn more about growth, I want to be systematic about the process. If I say I want to learn mathematics, for example, I’ll want to divide, in my head, different branches of the subject. Then learn about the topics, and the mathematicians associated with those topics, and drill down accordingly.

How to do that with growth?

Should we begin by analyzing all of human growth over all of its (available) history? Watch videos like this Ted Talk, go through courses such as this one, and read books such as this one? Or focus on one country/civilization and examine it’s growth over time? Say, the Indian civilization over time? Or modern India, since 1947? Or focus on a group of countries over a period of time, such as say Joe Studwell’s How Asia Works? Or all of the above?

The answer is, obviously, all of the above, but then in that case where to begin?


Hopefully you have been through the same process for different things/projects/concepts in your own life – that feeling of where to start, even?2

Here is how Robert Pirsig helped me understand the answer to that question:

A memory came back of his own dismissal from the University for having too much to say. For every fact there is an infinity of hypotheses. The more you look the more you see.

She really wasn’t looking and yet somehow didn’t understand this.

He told her angrily, “Narrow it down to the front of one building on the main street of Bozeman. The Opera House. Start with the upper left-hand brick.”

Her eyes, behind the thick-lensed glasses, opened wide. She came in the next class with a puzzled look and handed him a five-thousand-word essay on the front of the Opera House on the main street of Bozeman, Montana. “I sat in the hamburger stand across the street,” she said, “and started writing about the first brick, and the second brick, and then by the third brick it all started to come and I couldn’t stop. They thought I was crazy, and they kept kidding me, but here it all is. I don’t understand it.”

Pirsig, Robert M.. Zen and the Art of Motorcycle Maintenance (p. 171). HarperCollins e-books. Kindle Edition.

The brick that I have chosen to begin with is Robert Gordon’s book, The Rise and Fall of American Growth. It is a rather large brick, at 784 pages, and I am only one chapter in, but it is already worthy of a blogpost.

Consider this chart, for example:

Gordon, R. J. (2017). The rise and fall of American growth: The US standard of living since the civil war. Princeton University Press.

The book focusses on the period 1870 through until 2014, and attempts to explain the cause, the nature and the effect of growth on the United States of America for that period. As I said, a rather large brick. And the chart above shows that most of the growth during this period occurs in fact between the period 1920-1970, when measured in terms of output per hour and output per person. Growth went up, in other words, the most in this period.

And what caused this growth?

](https://firebasestorage.googleapis.com/v0/b/firescript-577a2.appspot.com/o/imgs%2Fapp%2FEFEPosts%2Ft7MtC-9D73.png?![
Gordon, R. J. (2017). The rise and fall of American growth: The US standard of living since the civil war. Princeton University Press

It wasn’t education-augmented labor, or more machinery, but rather, Total Factor Productivity. Here’s a previous post about the Solow Model, if you want to learn more about TFP.


This, of course, begs the obvious question: why?

Why was growth so very impressive in that period? As a prospective answer, at least in that first chapter, Gordon supplies a hypothesis that we are familiar with here on EFE: Paul David’s essay about the dynamo and the computer.

So quite simply, it takes time for us as a society to accept, internalize and then optimize for a new technology. The invention of a new technology doesn’t necessarily imply its adoption. For example, and this is a true story, we still get invites for faculty meetings at my Institute by hand, not online calendar invites.

And so growth is clumpy for at least the following reasons:

  1. The discovery of a new technology doesn’t necessarily mean it’s immediate wholesale adoption
  2. This is partly because of inertia, resistance to change and the sunk cost fallacy
  3. And it is partly because we as a society simply take time to try and figure out how to make best use of the new technology.

This involves job losses, restructuring, adjustments – and not all of these processes are smooth or even remotely pleasant. The long run consequences of adopting new technology are beneficial, while the short run adjustments are anything but. Focusing on reducing short term pain might well induce more long term pain, but focusing on long term gain is an impractical solution for politicians and policy-makers on the ground, unless a crisis makes it imperative and (at least somewhat) acceptable.

Think driverless cars today (per the link above), or think 1991 economic reforms. Selling either of these things without the crisis of that particular time would have been harder than it already was. As Morgan Housel says, crazy plants the seed of calm.

Leading me to ask myself the question: is growth necessarily lumpy? Might we be worse off for attempting to change it’s lumpy nature? I don’t know the answer to these questions, but they are questions worth keeping in mind as I proceed with Gordon’s book.

  1. As I wrote towards the end of that post, the spread of learning is what I would want to maximize, but that learning contributes towards growth, and more growth leads to more learning, so we’re on the same page for the most part[]
  2. I was tempted to use the excavator/Ever Given meme here. Please congratulate me for resisting the temptation.[]

Growth. Just, only, simply Growth.

Anybody who has been subjected to an introductory econ class by me has inevitably been through this:

I’ve been talking about Gapminder in my classes for over a decade now, and have written about it on these pages a number of times. I’m still to come even remotely close to being bored: it is simply that good. But today, I want to point out a feature of this graph that is a nice way to get started on thinking about economic growth.

As I always say when I introduce Gapminder to students for the first time, this is what Hans Rosling1 used to call the “Health and Wealth” chart – for obvious reasons. This is the crucial bit though: there is no country that is towards the top left of this chart, and there is no country that is towards the bottom right.

Rich countries – that is, countries with high GDP per capita – have better health outcomes. Poor countries – that is, countries with lower GDP per capita – have worse health outcomes. Yes, we are measuring health through only one parameter, and yes we can never be sure in what direction the causality runs2 – all that I’ll happily concede. But still, richer countries have better health outcomes. I’m, as they say, willing to die on this hill.

Growth matters.


Growth, or GDP per capita, or material well-being – I’ll conflate these terms and give textbook authors a heart attack in the process – they aren’t an end in and of itself. They’re the means to achieving ends: health, education being just two of them.

And yes, growth comes at a cost, and there are problems with growth – many, many problems. But still.

Growth matters.


And as I mentioned in yesterday’s post, Lant Pritchett is a bhakt when it comes to worshipping growth:

Broad-based growth, defined as the process that raises median income, is far and away the most important source of poverty reduction. There is no instance of a country achieving a headcount poverty rate below 1/3 of its population (at moderate poverty line of $5.50) without achieving the median consumption of that of Mexico. This is not to say that there do not exist anti-poverty programs that are cost-effective and hence should be expanded, or, conversely, that there are anti-poverty programs that are not cost-effective (or even have zero impact on poverty) and should be cut back or eliminated. Analyses of these types of programs would enable a more efficient use of resources devoted to poverty reduction. But large and sustained improvements in global poverty will almost certainly have to focus on how to raise the productivity of the typical person in a poor country, which is a key source of national income growth.

https://econofact.org/poverty-reduction-and-economic-growth

Pritchett’s fervent defense of the idea of worshipping growth stems from two places. One, as a worthy idea in and of itself, but more so because he thinks that development economists have lost their way a little bit:

The only solution to world poverty is vast increases in the productivity per person which would be the result of sustained economic growth that is broadly shared and increases in national development. This is going to require the answers to many complex and interesting questions, and research into those questions is, to my mind, the domain of development scholarship. And, when national development is achieved the kinky development agenda is (nearly) completely solved through general social progress.

https://www.ideasforindia.in/topics/poverty-inequality/getting-kinky-with-chickens.html

(By the way, this article carries my all-time-favorite title ever.)

He is saying, in plain simple English, that growth is what matters. Everything else that is currently going on in development economics is secondary.

Growth matters.


And as one might anticipate by now, Gulzar Natarajan agrees:

I am strongly inclined to argue that foreign aid should be confined to either development of pure physical infrastructure or for R&D or for state capacity building and should avoid advocating or supporting specific social development programs in areas like health, education, nutrition, agriculture etc. As I will try to explain, there is something about social development programs that demands that these societies struggle hard on their own to make difficult collective social and political choices.

https://gulzar05.blogspot.com/2020/09/leave-poverty-alleviation-to-developing.html

And this excerpt too:

If Kenya needs to fix its school education system, its stakeholders need to grapple with the real reasons why children are not attending schools, why teachers are not accountable, why the quality of instruction is so poor, and prioritise resource allocation and make political choices accordingly. There is a path dependency associated with reaching the destination. Technical solutions are a diversion from the real task.
For example, take the issue of teachers accountability to the parents. A biometric attendance solution is a good innovation but in a complex system can at best offer the illusion accountability and that too for a short-time, while also postponing the imperative to undertake the reforms like making the school and teachers accountable to the local community.

https://gulzar05.blogspot.com/2020/09/leave-poverty-alleviation-to-developing.html

What he is really saying is that Goodhart’s law is a real problem, and we should cut to the chase and focus on the real, underlying problem, rather than chase relatively easily measurable metrics.

That is, getting teachers to punch in on time is no guarantee that they’ll teach well, much like getting students to attend classes is no guarantee that they’ll learn well. But making attendance mandatory, and measuring it, gives us the satisfaction of Having Done Something.

But the point of getting education “right” is to make people more productive. The point of getting education “right” is not to have teachers (or students) turn up on time!

And the point of helping folks become more productive is, as always the fact that:

Growth matters.3

  1. legend. Absolute legend.[]
  2. it runs both ways, but you get to say that only after many years of kadi tapasya[]
  3. In the post coming up on Monday, I’ll review a book that helps us understand why[]

A Conversation With Rationality

I’d gone to the RTO the other day for some work, and I suppose you know what comes next.

I wouldn’t say it is impossible to get work done without the help of an agent, but it is certainly true that it isn’t a breeze either. And if one teaches opportunity costs, it makes sense to take the “help” of an agent. Sure you can do it yourself, but it then becomes eye-wateringly expensive in terms of time. And therefore, money.

And while I waited in the numerous byzantine lines to get my work done, I reflected, like every good economist should, on what could be done to reform the system.

Just ban agents, my understandably irrational brain screamed as a first pass solution. Why doesn’t the bureaucracy come up with a better process map that just gets out of the way instead, Cold Calculating Rationality suggested.

Because they aren’t incentivized to, C.C.R went on to reason, proceeding to shut me out of the conversation altogether. Although I was, truth be told, a very interested bystander by now.

But why aren’t they incentivized to – isn’t that the next logical question to ask, mused C.C.R.

I mean, won’t it make their job easier if they make their processes easier?

Well, yes, but they earn the same either way, no? It’s not like payments are linked to productivity increases.

How would they earn more?

Maybe through a Coasean solution in which there’s connivance with the agents, and they get a cut? That is, make the process impossibly cumbersome, and continue to keep it cumbersome, no matter what any well meaning committee proposes. That then facilitates agents stepping in and “helping” blissfully ignorant citizens get their work done faster – for a fee, of course.

They take a cut of the fee – and hey, there you have it! Bureacracts have an incentive – but not to simplify the system! They have an incentive to continue to clog up the system.

C.C.R needed a break at this point in time, so it and I played a couple of rounds of Fruit Ninja on my phone.

But why, C.C.R asked – for it can take only so many minutes of mindless swiping – would anybody want to be an agent? I mean, there are surely better, more remunerative ways to earn a living.

C.C.R. and I stared at each other in part jubilation, and part horror.

“There aren’t better ways, no?!”, we said in unison.

“I mean, if markets are weakly efficient, nobody would willingly work as an agent, surely”, said C.C.R triumphantly.

“And so”, C.C.R went on to say in that insufferably smug way that is its wont, “if you really want to reform the system, you need to create better employment opportunities everywhere else. Reforming this particular system is just putting a band-aid on a cancer. Because yes middle-mean are bad, but nobody grows up dreaming of being a middleman. Of course the middlemen, and that entire nightmare of a system is going to be up in arms if you seek to eliminate it. The lack of alternative, viable careers: that’s the real problem.”

“So, just more pro-growth policies, you’re saying?”, poor old irrational me asked timidly.

“Well, yes. Easy answer, tough implementation, I’ll concede that point”, replied C.C.R.

“I wonder where else we can apply this line of thinking”, I was about to ask C.C.R… but then it was my turn at the window, and I was so happy that I was finally done with the whole thing that I stopped thinking about it altogether.

So it goes.

India: Links for 23rd September, 2019

  1. Income tax reforms: in my opinion, an urgent necessity.
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  2. ““If we wake up a little late after there is daylight, and go to defecate in the open, the railway authorities pelt us with stones or beat us with big sticks,” said Sumanben, a migrant Adivasi woman who lives on public land near a railway track. “Sometimes there is a watchman at night. If he is there then we cannot defecate that day.”.”
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    Indiaspend, ostensibly, on the Minimum Wage stipulations – but it is about more than that.
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  3. “We must therefore recall that if the India story plays out well in the world’s capitals, boardrooms, think tanks and editorial offices today, it is because of three developments: the development of a nuclear arsenal with a no-first use doctrine, the revulsion against international terrorism after 9/11, and India’s emergence as a high-growth economy with several globally competitive sectors. In the past two decades, India has come to be seen as an engine of global economic growth, a potential counter-weight to China, and a country that has taken a liberal democratic path to prosperity. It is high economic growth that created the conditions for India to tango with the US, be taken with grudging seriousness by China, and clear the way for better relations with East Asia, Australia and Europe.”
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    High growth matters: the geopolitical argument.
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  4. Amol Agarwal reports on the proceedings of ‘The International Conference on Indian Business and Economic History’. This deserves to be widely read, and widely shared.
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  5. “What is needed is a change in the policy regime in many cross-cutting systemic issues, such as the role of politicians, stability of tenure, size and nature of Indian bureaucracy, accountability, monitoring of programmes, and civil service reforms, which will transform the individual competence of IAS officers into better collective outcomes.”
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    In a sense, a frustrating article to read, because more than the what, which is clear to all, it is the how that is important – and that is missing.

Links for 6th May, 2019

  1. “Not long ago, the Liverpool away coach uniform was technical mountain climbing apparel, which had its roots in drug dealers in cold northwest England figuring they didn’t need to freeze to death slinging weed in a park. That meant a lot of North Face gear, which became fashionable. One leader at an LFC firm bought so much high-end gear that when he got a stadium ban several years ago, he actually started climbing mountains around the country, unsure of what else to do with all the stuff he’d bought.”
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    A nice long read on Liverpool: the city and the club. Also a fascinating peek into a place in England that isn’t necessarily English.
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  2. “In my view, reform of government economic administration must take priority. As things stand, it is a prerequisite for the success of any other reform. A weak state cannot deliver anything other than grandiloquent statements of intention. This must change. Without a capable State, there can be no transformation.”
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    Rathin Roy explains in the Business Standard why India hasn’t fulfilled its potential so far, and what needs to be done to change the status quo.
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  3. “How much, in all, does Popovich spend annually on food and wine? That’s hard to say. But he reportedly earns $11 million a year, the highest salary in the league for a head coach. Considering the offerings from his private wine label and that he holds thousands of bottles in his cellar, plots out dozens of high-end dinners per year at some of the country’s most high-end restaurants, drops $20,000 on wine alone at some dinners, and routinely leaves exorbitant tips — well, it’s not a stretch to suggest that Popovich might ultimately drop a seven-figure annual investment on food and wine. “He’s spent more on wine and dinners than my whole [NBA] salary,” former NBA coach Don Nelson says. But in San Antonio — where Popovich has won more with his team than any NBA coach has with a single team in history — the investment, apparently, has been worth it.”
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    Is good dining the means to an end? Read this fascinating article to find out one man’s answer.
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  4. “Gorbachev pushes back at the notion that the Soviet Union’s end was somehow a triumph for the other side. “Americans thought they’d won the Cold War, and this went to their heads,” he says. “What victory? It was our joint victory. We all won.” Well, maybe not entirely — Vladimir V. Putin, pointedly absent from most of the film, is glimpsed in footage of Raisa Gorbachev’s funeral — but you come away from the movie agreeing with Herzog’s assessment, and yearning for Gorbachev’s brand of diplomacy.”
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    A short article about Gorbachev – a documentary about the man. He’s 88 this year, but the article is interesting throughout. And the excerpt is a great way to think about whether you have really understood the concept of a zero-sum-game.
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  5. “The Northern states are densely populated. But this density has clearly not provided the economies of scale to promote rapid economic growth. One problem is that the dense population in the Gangetic plains is not clustered in large cities. Prateek Raj of the Indian Institute of Management in Bengaluru has written about the metropolis vacuum in the Hindi speaking states of Uttar Pradesh, Bihar, Jharkhand, Madhya Pradesh and Chhattisgarh, which together have 500 million residents (bit.ly/2UOS2Kv). “The glaring absence of a major metropolitan center in the region has forced young people to migrate away from the small towns and move to other cities in the West and the South,” he argues.”
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    A lovely read from Niranjan Rajadhakshya about what ails Northern India and how one might tackle the issue. The lack of urbanization is a very real problem in Northern India, among others.

Links for 12th April, 2019

  1. “Due to these challenges, the Belt and Road has provoked growing international resistance, most acutely in the Indo-Pacific. This rising backlash has not gone unnoticed in Beijing.3 Yet it is unlikely that China’s approach will fundamentally change in the years ahead. The sheer size of ongoing Belt and Road projects limits China’s ability to refocus on smaller and less controversial efforts. Moreover, the Belt and Road is ultimately a vehicle for China’s geopolitical ambitions. Liabilities for host countries – loss of control, opacity, debt, dual-use potential, and corruption – are often strategic assets for Beijing. ”
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    Worth reading in its entirety, both for how well they have framed it (10 issues, 7 challenges) and for understanding the scope, the scale of OBOR – as well as why China wants something like this to happen.
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  2. “Krugman’s assertion that capacity keeps on rising might be correct – but that probably depends on one of the following conditions:The recession is short enough not to significantly affect innovation and investment
    Growth depends on factors that are not (negatively) affected by recessions
    Underlying capacity growth will accelerate beyond trend as the recession endsThe first we can yet hope for, but it’s looking less likely every month.”
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    This was written ten years ago. It is a great way to understand the following: business cycles, trend stationarity, unit root hypothesis, innovation, capacity building, endogenous growth theory. It is simply written, engaging, understandable – and because it was written ten years ago, can be validated. Worth it!
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  3. “Whereas Liverpool’s pursuit of the league title has been characterised by anxiety, drama and late winners, since the turn of the year City have been gracefully efficient at tearing into opponents, getting an early goal and so being able to control a game. Gabriel Jesus’s header against Brighton in the FA Cup semi-final on Saturday was the sixth goal City have scored this season inside five minutes, the 12th before the 10th minute and the 26th before the 20th. That is clearly part of a policy: rip into opponents, prevent them settling and have the game won before any doubts can begin to creep in. It may be that in a two-leg tie there’s less impetus to do that – but then an away goal can make a huge difference.”
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    You might find this choice weird, especially if you don’t like football, but this resonated with me as a way to do more than just play football. Think about it!
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  4. “Mumbai is the engine of the prosperous western state of Maharashtra, India’s largest regional economy with a GDP somewhere between $350-400 billion; the city contributes well over half the total. For Maharashtra to become a $1 trillion economy, Mumbai would need to double or triple the size of its economy, on the back of its preeminent role in service industries, especially finance. That means competing with the likes of Singapore and Shanghai to attract global banks and other world-class financial institutions to the humid, traffic-choked city.”
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    Rueben Abraham and Shashi Verma in Bloomberg on how the port near Mumbai has the potential to change Mumbai into a truly global financial hub. The cynic in me wonders if it will be possible, but the nascent urbanization enthusiast hopes that this, at least, gets off the ground!
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  5. “Amsterdam transit commissioner Sharon Dijksma announced Thursday that starting this summer, the city plans to reduce the number of people permitted to park in the city core by around 1,500 per year. These people already require a permit to access a specific space (and the cost for that permit will also rise), and so by reducing these permits steadily in number, the city will also remove up to 11,200 parking spaces from its streets by the end of 2025.”
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    Speaking of urbanization done just right, here’s Amsterdam with a plan to reduce parking spaces in the city centre – and beyond.

Links for 2nd April, 2019

  1. “The growing use of digital transactions—by consumers, investors, tax payers—as well as the rise of newer forms of data collection has the potential to revolutionise Indian public policy. It is unlikely that these newer forms of data will completely replace the more traditional numbers derived from surveys, national accounts and administrative data. They will more likely complement each other. Government agencies will increase their dependence on big data analytics in the coming years—though the risks to individual privacy should not be underestimated.”
    Niranjan Rajadhakshya on big data, data collection, and how we might reach conclusions on the basis of both over time. The papers he mentions towards the end are also worth reading in their own right!

  2. “According to the Handbook Of Statistics On Indian Economy 2016-17, since the 1991 reforms, the Union government’s revenue has increased 25 times and state government revenues have increased 28 times in nominal terms, and about 4 times in real terms. Economic growth and the consequent increase in revenue also increases the ability of the government to focus on inequality and deal with sector-specific distress.”
    The article is about why economic growth is important for poverty alleviation, an as the article itself says, this is both an obvious point, but also one that bears repetition. But the excerpt above was notable for me: obvious in retrospect, but worth thinking about. Government revenues have gone up significantly since liberalization.

  3. “In 2014, the Delhi High Court found both major parties guilty of violating foreign-exchange laws when they accepted a donation from London-based commodities giant Vedanta Resources Plc.(The suit, filed by a former top bureaucrat and the Association for Democratic Reforms, was against the political entities and Vedanta wasn’t a party. The company didn’t respond to request for comment. The BJP and Congress argued the donations weren’t foreign because the Vedanta units that channelled the money were registered under Indian law.)
    The law passed last year changed the definition of a foreign company all the way back to 1976, effectively nullifying the court’s verdict because Vedanta’s overseas parent owned less than 50 percent of the Indian unit.”
    A somewhat depressing, if all too predictable read about campaign financing in India. There isn’t that much more to say  do read the whole thing, though.

  4. “This jellyfish doesn’t mean to brag, but it’s both beautiful and immortal. If it gets sick, or even stressed, it just reverts into it’s younger self so it can get strong and mature again, bouncing between youth and adulthood forever.”
    It’s impossible to choose one particular thing to highlight – please (for a change!) read every single comment. Nature is an impossibly weird thing, and we know far too little about it.

  5. “One of the great sources of leverage is other people. You can get leverage via directing folks to do things (a superpower whose impact I probably underappreciated when running my business solo). You can also get it by making them more effective at doing things.”
    A very long essay, perhaps rambling in part – but a great read nonetheless. About a whole variety of things, but mostly about productivity, I’d say – the self and the organization, both.

Links for 14th March, 2019

  1. “It is an example of the paradox of India’s state capacity that it can execute well-defined tasks like elections, census, disaster relief etc with unparalleled proficiency and do the simplest things like running mid-day meal kitchens in the most appalling manner.”
    The always excellent Gulzar Natarajan on the paradox that is Indian bureaucracy. Given the remarkable efficiency with which we run our elections – and read the article to find out just how efficient it really is – why not other stuff in India? I do not have a clue. Will headline converge to core, or will core converge to headline?
  2. “While a Chinese depreciation would be a negative to shock to the world, China’s apparent willingness to use fiscal tools to restart its economy should be helpful to the world, at least directionally.*”
    The asterisk is at least as important as the excerpt, because the nature of the fiscal stimulus will matter more than the extent of it in the long run – but an update on what is fast becoming a mini-series – the state of China’s economy.
  3. “A key problem is that there are no interpretations of these concepts that are at once simple, intuitive, correct, and foolproof. Instead, correct use and interpretation of these statistics requires an attention to detail which seems to tax the patience of working scientists. This high cognitive demand has led to an epidemic of shortcut definitions and interpretations that are simply wrong, sometimes disastrously so – and yet these misinterpretations dominate much of the scientific literature.”
    I don’t know if I’ve fully understood p-values, and I don’t know if I do a good job of teaching them – to the extent that I understand them myself. And occasionally reading, and re-reading this blog post is therefore a useful thing to do. Assuming it is correct in the first place!
  4. “…boosting an intermediate range of labor-intensive, low-skilled economic activities. Tourism and non-traditional agriculture are the prime examples of such labor-absorbing sectors. Public employment (in construction and service delivery), long scorned by development experts, is another area that may require attention. But government efforts can go much further.”
    Buried in this article are a whole range of papers waiting to be written – but that’s for academicians to salivate over. The article is a wonderful summary of what good jobs are, why they are difficult to come by today, and what can be done to make sure that they do come by.
  5. “I suppose it’s worth trying to measure economic growth, but don’t take the findings too seriously.”
    Words to live by, and I mean that. Trying to measure economic growth is, ultimately, an un-solvable problem. Conversely, any estimate that we have is always going to be off the mark. Think through the implications (and the implications of the implications!)