- “The classic example in language is that a doctor is male and a nurse is female. If these biases exist in a language then a translation model will learn it and amplify it. If an occupation is [referred to as male] 60 to 70 percent of the time, for example, then a translation system might learn that and then present it as 100 percent male. We need to combat that.”The Verge interviews Macduff Hughes, the head of Google Translate. Worth reading for understanding applications of AI, the amount of bias that exists in our culture (along various dimensions), and the garbage in, garbage out problem.
- “This was a great year for iPhone customers, but perhaps not for Apple itself… Technology is outpacing customer need and phone lifespans are ever-longer, which we saw hurt Apple’s bottom line.”Keeping a tab on Apple makes sense, and this is a good place to start. Apple has had a difficult year for many reasons, but the most important reason has been a multi-year phenomenon – Apple has gotten too good for its own good.
- Ben Thompson tells it like it is:
“While I know a lot of journalists disagree, I don’t think Facebook or Google did anything untoward: what happened to publishers was that the Internet made their business models — both print advertising and digital advertising — fundamentally unviable. That Facebook and Google picked up the resultant revenue was effect, not cause. To that end, to the extent there is concern about how dominant these companies are, even the most extreme remedies (like breakups) would not change the fact that publishers face infinite competition and have uncompetitive advertising offerings.”
Worth reading for an excellent discussion of the law of conservation of profits, the Buzzfeed firings that took place recently, and the future of media. - As Tyler Cowen never tires of saying, “solve for the equilibrium“:
“The content industry spent years trying to battle piracy via all manner of heavy handed-tactics and lawsuits, only to realize that offering users inexpensive, quality, legitimate services was the best solution. Many users flocked to these services because they provided a less-expensive, more flexible alternative to traditional cable.Now, if the industry isn’t careful, it could lose a sizeable chunk of this newfound audience back to piracy by making it overly expensive and cumbersome to access the content subscribers are looking for.”
Worth reading for why piracy may yet re-emerge, a good understanding of market entry and exit, and competition and its implications. - “The market valuation of Baidu, Alibaba, and Tencent (BAT) is more than a quarter of India’s GDP.”
What a stunning statistic. The rest of the blog post is a good way to acquaint yourself with how China has seen it’s internet ecosystem grow, and where India could improve.
Tag: India
A Tale of Three Movies
We took a look at statistics in the previous posts, and learnt how India has gotten richer over time. Rather slowly, since independence until the mid-1980’s, and then increasingly rapidly since then. Which is all well and good, but every Indian knows that statistics are like skirts.
So let’s try and take a non-data oriented look at India since Independence, shall we? And what better way of taking a look at India than by taking a look at Bollywood?
In the year 1954, Bimal Roy directed a movie called “Naukari”. Starring Kishore Kumar (in a very un-Kishore Kumarian avatar), the movie is about the difficulty that the youth of India face in terms of finding employment in India’s cities. To call it a tear-jerker is an understatement – one calamity after another befalls our protagonist.
My point is not the plot, though, but the theme. If you accept the argument that mainstream Bollywood movies are all about giving the janta what they want, then this movie was a reflection of stuff that people identified with back then. A movie about an idealistic youth who leaves his village to go work in the city is what the 1950’s were about.
Fast forward to 1975, and to one of my all-time favorite movies: Deewar. I love it for the acting, the dialogues and the plot, as does everybody else, but my inner economist is also a big fan of the movie. You see, Kishore Kumar in Naukari was about finding a job. Amitabh, by 1975, had given up on finding one. One way of viewing the movie is to say that fate conspired against him. The other way would be to say that the system failed him – and I’d argue that this is something that quite a few people back then could at least partly empathize with.
Deewar succeeded for multiple reasons, but at least one of those reasons was the fact that it struck a chord with the youth of that time: anger about jobs being hard to come by is a palpable sentiment in most movies of that time.
And then move on to the movie that best represents the zeitgeist of the India that I grew up in: Dil Chahta Hai. DCH wasn’t about aspiring to get a job, it wasn’t about being angry at the prospect of not landing one – it was about not caring a damn about the whole thing. This point is repeatedly driven home in the movie: Aamir Khan’s dialogue just before “Koi Kahe”, or the scene with his parents in which he’s packed off to Sydney come immediately to mind.
And we lapped it up! Couldn’t get enough of it. And it is quite true: the middle-class urban youth of our time wasn’t big on worrying about landing a job. It wanted to drive to Goa in a Merc.
Each movie was appropriate to its time. Audiences in the 1950’s didn’t want to see Dil Chahta Hai, and theatre going audiences in the 2000’s didn’t want to see movies about jobs.
Well, ok, maybe they did.
Understanding the Importance of GDP Growth
What is GDP all about? Why is it so very important, and why do economists spend so much time in tracking it? As we discussed in an earlier post, the GDP growth rate is one way of understanding how much more we produced in a given period compared to the last one.
So more is always good, right?
Well… not quite.
It’s a question I struggle to answer in the context of GDP growth, because yes, growth is good, but with qualifiers. It’s a little bit like saying that speed is good where a car is concerned, but too much of it can be quite disastrous.
And in a book that I have started reading recently, I came across a way of thinking about GDP growth in India that I quite liked:
In this book, I define the objective of India’s economic development as rapid, inclusive, stable and sustainable growth of national income, within a political framework of liberal democracy
(emphasis in original)
The book in question is “India’s Long Road” by Vijay Joshi, with the subtitle being “The Search for Prosperity”. Vijay Joshi has done all kinds of awesome sauce things over a long and distinguished career, and a 500 word limit will not begin to do justice to his many accomplishments. Suffice it to say that reading this book is well worth your time if you are interested in India’s growth story.
But to go back to the quote above: the author is saying, as is everybody else, that growth is important, indeed crucial, from an Indian context. That’s the rapid part. However, we also need to make sure that the growth is inclusive. Which means it’s not just important to bake a larger cake, but it is also important to make sure that every gets a slice (and preferably, as equal a slice as possible). There are many ways to accomplish this, and we don’t always do a perfect job in this regard but here’s the most important bit: we have to bake a larger cake first! Distributing a very small cake equally isn’t the point.
Stable implies growth that happens in steady fashion, not haphazardly, not in fits and starts. Put another way, steady growth over a decade is better than rapid growth for the first five years and no growth for the other five. Listen closely, and you can hear the sound of every RBI governor alive nodding his head ever so vigorously.
Sustainable would mean environmentally friendly. That’s a separate book in and of itself, but what we want is a rapidly growing country that has breathable air, drinkable water and arable land 100 years from now. Some might say that’s a contradiction in terms, but we won’t wake that particular beast just yet.
And the last bit? …within the framework of liberal democracy is treated as being almost axiomatic by Vijay Joshi, and in my opinion, rightly so. Sure, we grow slower as a consequence of our choice of a liberal democracy, but if that’s the price for political freedom, it is certainly worth it.
But I’d much rather that we work towards achieving rapid, stable, sustainable and inclusive economic growth within the framework of a liberal democracy, than achieving rapid GDP growth.
It’s a longer definition, but a better target.
Why 1978 and 1991 will likely be the most important years of the 20th century
If you had to pick just one year from the 21st century and say that this was the year that mattered the most, which year would you pick? Some might pick 1939 and the start of WWII. Others, for the same reason, might pick 1945, as the year it finally ended. Others more in tune with the long run forces of history might pick 1914 because that’s when the whole thing really started.
But that’s answering the question from a European perspective. Closer to home, you might want to pick 1947, and our neighbours to the east might pick 1949 for broadly similar reasons. But as an economist from these parts, my choice would by 1978 from a broader perspective, or 1991 from a purely Indian one.
Because 1978 was the year in which Deng Xiaoping famously said “Let some people get rich first” and kickstarted the process of market reform in China. Xiaogang is a village that almost nobody outside of China has heard of, but if you’re interested in the question of how nations get richer over time, you should take the time out and click on that link. There’s a lot else that Chinese economic history has to teach us, but we’ll get to it over time.
Let’s move on to the other date that we think is important from the 20th century: 1991.
“A moment comes,which comes but rarely in history,when we step out from the old to new,when an age ends,and when the soul of a nation,long suppressed,finds utterance.” Famous words, uttered by a famous politician, and possibly the most famous speech by an Indian politician. We’d argue that these apply in almost equal measure to the year 1991, because that is when the entrepreneurial spirit of India, long suppressed, finally found utterance.
It is when business stopped being a bad word in Indian parlance, and getting (and staying!) rich was seen not as a dubious achievement but an everyday event. Indians going to movie houses post 1991 admired the Mercedes that Amir Khan drove to Goa in Dil Chahta Hai, and not the smoudering angst that Amitabh Bachchan harboured against the system in Deewar. Aspirations were a good thing, and it was ok to say that publicly after 1991.
The Liberalized Exchange Rate Management System (LERMS), the New Economic Policy (NEP) of 1991 and the other economic policies of that era were remarkable, and are rightly being celebrated today as the cornerstones of the remarkable change that has been wrought in India since. And we’ll talk about the impact that these policies had in the posts to follow.
But they are, in a sense, merely the tools that allowed P Chidambaram, Montek Singh Ahluwalia, PV Narasimha Rao and above all, Manmohan Singh to say what Deng Xiaoping had said all those many years ago in China.
1991 was about letting Indians get rich.
EconForEverybody 