India: Links for 18th November, 2019

  1. ““In the end it was this access to unlimited reserves of credit, partly through stable flows of land revenues, and partly through collaboration of Indian moneylenders and financiers, that in this period finally gave the Company its edge over their Indian rivals. It was no longer superior European military technology, nor powers of administration that made the difference. It was the ability to mobilize and transfer massive financial resources that enabled the Company to put the largest and best-trained army in the eastern world into the field””
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    An excerpt that itself was excerpted, but too delicious to resist – Alex Tabarrok writes an excellent review of William Dalrymple’s latest book on the East India Company.
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  2. “The problem is that, rather than examining independent indicators of economic activity, the Bretton Woods’ forecasts appear to be based primarily on (a) extrapolation of the official growth figures, and (b) some subjective adjustment based on staff’s assessment of policy changes.”
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    CGDEV on reporting of India’s growth numbers.
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  3. “Is all this working? Economists have talked about the possibility of green shoots of recovery in the second half of this financial year. However, looking at the data for July to September 2019, for now the slowdown is well and truly in place.”
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    Vivek Kaul isn’t impressed with the state of the Indian economy.
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  4. And perhaps with good reason: Somesh Jha on the fall(!) in rural demand.
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    “Consumer spending fell for the first time in more than four decades in 2017-18, primarily driven by slackening rural demand, according to the latest consumption expenditure survey by the National Statistical Office (NSO).”
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  5. Slate Star Codex on 1991, and the difficulty of using statistics. Econ nerds only!
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    “…”we need to study and raise awareness of the history of democratic, comparatively “nice” countries that did nothing worse than overregulate business a bit – and investigate whether even these best-case scenarios still doomed millions of people to live in poverty. My (biased) guess is that careful study will show this to be true.”

EC101: Links for 7th November, 2019

  1. Idea Vodafone debt rating downgraded. Uh-oh.
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  2. “When Arun Sarin, Vodafone Group Plc’s India-born former CEO, was charting the British telecommunications firm’s expansion into emerging markets in the mid-2000s, his home country with more than a billion potential phone users seemed a compelling choice.Sarin wasn’t alone. Norway’s Telenor ASA, Russia’s Mobile TeleSystems PJSC and Malaysia’s Maxis Bhd were also among a slew of companies that flocked to this fast-growing market. The carriers banded with local partners, bid for airwaves and licenses, spending billions of dollars to prepare their networks.

    But what once appeared to be their most-promising Asian wireless market has turned sour. Vodafone’s Indian venture with billionaire Kumar Mangalam Birla, saddled with $14 billion of debt, is said to be seeking to revamp its borrowings amid mounting losses and a tariff war. Tycoon Sunil Mittal’s Bharti Airtel Ltd. is rated junk by Moody’s Investors Service. In a market that had a dozen carriers two years ago, just three are left standing today — two of them, barely.”
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    Here’s more context from Bloomberg.
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  3. “Notoriously high levels of pendency of cases discourage those with limited influence and resources from approaching the courts for justice. Police stations, especially those in rural areas, make registration of complaints and first information reports cumbersome to help them manage their strike rates. Some websites expect visitors to read privacy policies and indicate consent by checking specific boxes before letting them browse pages. The notice is sometimes in an unfamiliar language. Immigration applications involve onerous paperwork that is lengthy and confusing.”
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    Puja Mehra, author of the excellent “The Lost Decade” explains what sludge is, and why it matters in India
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  4. All incentives matter, but some incentives matter more than others. That’s the basic takeaway, but please, I beg you – take the time to read this article in full. Slate Star Codex is just utterly magnificent.
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  5. A fascinating article on the origins of the Amazon battery.

RoW: Links for 14th August, 2019

Five links about gun control from the United States of America:

  1. First, from Chriss Blattman, who knows a thing or two about violence.
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  2. Slatestarcodex, on trying to make sense of the data
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  3. and what the comments section from that blog has to say.
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  4. Gun control, the Japanese way.
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  5. To circle back to the beginning, a contemplative article from Vox.

Ec101: Links for 4th July, 2019

  1. “I’m more worried about the part where the cost of basic human needs goes up faster than wages do. Even if you’re making twice as much money, if your health care and education and so on cost ten times as much, you’re going to start falling behind. Right now the standard of living isn’t just stagnant, it’s at risk of declining, and a lot of that is student loans and health insurance costs and so on.What’s happening? I don’t know and I find it really scary.”
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    An article that spanned an entire book (about which more below). But do read this article very, very carefully, especially if you think you really understand microeconomics.
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  2. “Here, for example, are two figures which did not make the book. The first shows car prices versus car repair prices. The second shows shoe and clothing prices versus shoe repair, tailors, dry cleaners and hair styling. In both cases, the goods price is way down and the service price is up. The Baumol effect offers a unifying account of trends such as this across many different industries. Other theories tend to be ad hoc, false, or unfalsifiable.”
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    A short excerpt from an article on the book that materialized from the article on Slate Star Codex above (and by the way, you might want to start following Slate Star Codex). I have linked to some of them already, but do scroll through to click on “Other posts in this series” to read them all.
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  3. “The 23 times increase in the relative price of the string quartet is the driving force of Baumol’s cost disease. The focus on relative prices tells us that the cost disease is misnamed. The cost disease is not a disease but a blessing. To be sure, it would be better if productivity increased in all industries, but that is just to say that more is better. There is nothing negative about productivity growth, even if it is unbalanced.”
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    An excerpt from an excerpt, admittedly, but still well worth your time, to help you understand why the cost disease isn’t really a disease. It’s all about productivity, and how it grows unevenly (and hey, that’s a good thing!)
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  4. “State intervention to fix market failures that preclude the emergence of domestic producers in sophisticated industries early on, beyond the initial comparative advantage.
    Export orientation, in contrast to the typical failed industrial policy of the 1960s–1970s, which was mostly import substitution industrialisation (ISI).
    The pursuit of fierce competition both abroad and domestically with strict accountability. ”
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    You really should be reading How Asia Works by Joe Studwell – everybody should read that book, and multiple times. But that being said, here is the TL;DR version.
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  5. “There doesn’t seem to be evidence that hiring from outside is better. What evidence does exist seems to be that internal hires get up the learning curve faster, and often don’t need as much of an immediate pay bump. If you persuade someone to leave their current employer by offering more money, what you get is a worker whose top priority is “more money,” rather than on work challenges and career opportunities. (“As the economist Harold Demsetz said when asked by a competing university if he was happy working where he was: `Make me unhappy.’”)”
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    Tim Taylor on the difficulty of hiring (and retaining) right.

Links for 17th May, 2019

  1. “Despite the 73rd and 74th Constitutional amendments, except in a few states, there has been little progress at decentralization—to both rural and urban local bodies. Most state governments have been reluctant to devolve the functions, funds and functionaries for delivering public services at the local level. The functions assigned are unclear, funds uncertain and inadequate, and decision-making functionaries are mostly drawn from the state bureaucracy. Local bodies do not even have powers to determine the base and rate structure of the taxes assigned to them. The states have not cared to create institutions and systems mandated in the Constitution, including the appointment of the State Finance Commissions, and even when they are appointed, states have not found it obligatory to place their reports in the legislature. In fact, the local bodies are not clear about delivering local public goods, with the prominent agenda of implementing central schemes obscuring their functions.”
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    M. Govinda Rao pulls no punches in pointing out how and why decentralization hasn’t (and likely will not) taken place in India. This is a conversation more people need to be having in India – and in particular, to aid meaningful urbanization.
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  2. “I love this paper because it is ruthless. The authors know exactly what they are doing, and they are clearly enjoying every second of it. They explain that given what we now know about polygenicity, the highest-effect-size depression genes require samples of about 34,000 people to detect, and so any study with fewer than 34,000 people that says anything about specific genes is almost definitely a false positive; they go on to show that the median sample size for previous studies in this area was 345.”
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    Slate Star Codex helps us understand the importance of learning (and applying!) statistics. The website is more than worth following, by the way.
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  3. “Sucking the life out of a mango is one of those primal pleasures that makes life feel worthwhile. The process is both elaborate and rewarding. The foreplay that loosens up the pulp inside, the careful incision at the top that allows access without a juice overrun, and then the sustained act of sucking every bit juice from the helpless peel. Senses detach themselves from the body and attach themselves to the mango, and even mobile phones stop ringing. The world momentarily rests in our mouths as we slurp, suck and slaver at the rapidly disappearing pulp. The mango is manhandled vigorously till only the gutli remains which is scraped off till it has nothing left to confess. As is evident, there is no elegant way to eat this kind of mango, no delicate and dignified method that approximates any form of refinement, which is just as well, for the only way to enjoy a mango is messily.”
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    An excellent column about an excellent fruit – there isn’t that much more to say! I completely agree with the bit about serving aamras front and center, rather than as an afterthought, by the way.
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  4. “Welcome to the 4th Annual Top Economics Blogs list. For the 2019 edition, we’ve added many newcomers, as well as favorites which continue to provide quality insight year after year. Like lists in previous years (2018, 2017, 2016), the new 2019 list features a broad range of quality blogs in practically every economic discipline. Whether you are interested in general economics or prefer more specific topics such as finance, healthcare economics, or environmental economics; there is something here for you. You will also find blogs which focus on microeconomics, macroeconomics, and the economics of specific geographical regions.Whether you are a student, economics professional, or just someone with a general interest in how economic issues affect the world around you, you’re certain to find the perfect blog for your specific needs.”
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    The most comprehensive answer to that most perennial of questions: what should I read?
    Bonus! If you’re wondering how to keep up with all of this, this might help.
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  5. “India should do the same with our state capitals. The Union government can create fiscal and other incentives to encourage state governments to shift their capitals to brown- or green-field locations. Mumbai, Bengaluru, Hyderabad, Chennai, Jaipur or Lucknow, for instance, will continue to thrive even if the state government offices move out. Their respective states will benefit from a new urban engine powered by government.”
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    I have been sceptical about the feasibility of doing something like this – my reading of urbanization has always been that it more of an organic process – cities grow (or not) of their own accord, and rarely as a planned endeavor. But maybe I’m wrong?