EC101: Links for 18th July, 2019

Some news: the Gokhale Institute of Politics and Economics (where I work) recently started an undergraduate program in economics. I can’t tell you how excited I am at the opportunity to teach young people economics. Hopefully – although I cannot commit to this yet – I will be able to keep you updated with what we’re trying that’s different, and what I learn through the process of teaching in this program.

In honor of this first batch of students, though, here are five links from two people who have inspired me, and countless others, to both learn and teach economics. Marginal Revolution: thank you.

  1. What should I read to learn economics?
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  2. What’s the shortest description of economics as a field of study?
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  3. How soon is too soon to start teaching economics?
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  4. Can skating teach you about economics? Well, uh, it’s complicated
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  5. The most important lesson in economics I have ever learnt, and can ever teach.

 

As I said, I hope to update this blog regularly with lessons I have learnt, of many sorts. And fingers crossed, I will be able to do so. Here is the syllabus, in case you are interested.  In the meantime, if you have suggestions, comments, feedback – please do let me know.

Thanks.

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RoW: Links for 26th June, 2019

Articles from the Far East in today’s edition:

 

  1. “Thus is revealed a deeper lesson still: Freedom is not merely the ability to buy and sell goods at minimum regulation and a low tax rate, variables that are readily picked up by economic freedom indices. Freedom is also about the narratives people live by and the kind of future they imagine for themselves. Both of these are greatly affected by the legitimacy and durability of their political institutions.”
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    There’s lessons to be learned for all nations from what is going on in Hong Kong today, and Tyler Cowen ably lays out a map. In short, political institutions really matter – and that is a truly important lesson for anybody who wishes to learn economics.
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  2. “There were three such commitments: “to establish new U.S.–DPRK relations,” “to build a lasting and stable peace regime on the Korean Peninsula,” and “to work toward complete denuclearization of the Korean Peninsula.” The North also pledged to unearth the remains of Americans missing in action, which could help put the Korean War to rest—and not just for those most intimately affected.”
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    From about two weeks ago, but worth reading to get a sense of where North Korea and America are today, relative to where they thought they would be.
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  3. “At 12:42 a.m. on the quiet, moonlit night of March 8, 2014, a Boeing 777-200ER operated by Malaysia Airlines took off from Kuala Lumpur and turned toward Beijing, climbing to its assigned cruising altitude of 35,000 feet. The designator for Malaysia Airlines is MH. The flight number was 370. ”
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    This came out about a week ago, and if you are at all on social media, you’ve probably read it already, but on the off chance that you haven’t: a haunting coda to the sorry saga that is MH370.
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  4. “Beijing’s increasing heavy-handedness is more a symptom of fear than strength. It is borne in part from anxiety about the global trend of power diffusing from governments to non-state actors, a development that runs against the Communist Party’s desire to keep a tight grip on society. It also arises out of the Communist Party’s deep-seated concern that its legitimacy will come under scrutiny, particularly as economic growth continues to decelerate. Beijing’s endemic challenges in enforcing discipline within the Communist Party, particularly as it relates to corruption, also arouses anxieties. So, too, does latent admiration within Chinese society for values that America has sought to advance, even as popular views of the United States government come under fresh scrutiny.”
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    An interesting take on how to view Chinese culture, American culture, and how they evolve in response to each other, and each other’s forms of government.
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  5. “I was given time to try and log in again the next day after my penalty had been served.When I did I had to push “agree and unblock” under the stated reason of “spread malicious rumours”.
    So this rumour-monger clicked on “agree”.
    Then came a stage I was not prepared for. “Faceprint is required for security purposes,” it said.
    I was instructed to hold my phone up – to “face front camera straight on” – looking directly at the image of a human head. Then told to “Read numbers aloud in Mandarin Chinese”.”
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    The surveillance state in China, it’s capabilities, and it’s potential threats. All on China’s most popular app.

Tweets for 22nd June, 2019

 

 

 

 

ROW: Links for 19th June, 2019

This week, here’s a selection of five articles that help you understand issues in America a little bit better.

 

  1. “The old consensus that the US needed to help address the “root causes” of migration, by investing in the Northern Triangle countries and making it more appealing for people to stay, was never supposed to be an immediate solution to anything. Of course, Trump’s view of migration makes it less likely that anyone will be able to start work on long-term solutions that might bear fruit down the road. It is almost certainly, in the meantime, going to get worse before it gets better.”
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    Vox gives us a clearer picture on the migration crisis at the southern US border. Yes it is bad, yes, there is a crisis, and yes, it likely will get much worse before it gets a little better, for a variety of reasons. All of which are explained in this piece.
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  2. “Of course, if it hadn’t been for Roe, there also wouldn’t have been more than 50 million abortions since 1973; whether that’s a good or bad thing will be left as an exercise for the reader. But many abortions would have been performed anyway, because before the court took the issue away from voters, polls showed public opinion steadily trending in favor of legalized abortion, and the procedure was already legal in several states.”
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    Are you familiar with Roe v Wade? If you aren’t, read up about it first. Then read up about what Alabama is up to today. And finally read this article. And also consider following Megan McArdle (the author of this piece)
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  3. “Rather, regardless of what any deal achieves, the two nations appear to have entered a protracted era of competing for technological advantage, in areas ranging from aerospace and telecommunications to artificial intelligence, all with big military as well as commercial implications. Managing tensions over the issue is an increasingly important part of the U.S.-China relationship, for both sides.”
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    The Christian Science Monitor on what the trade war, or the new cold war (or whatever else it is that you want to call it) really is all about.
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  4. “This resonates with my own view. A large, established enterprise can be thought of as a cultural institution, with particular rules, norms, systems, processes, and institutional knowledge ingrained throughout the firm. In a stable environment, this corporate culture is a valuable asset. But as the business environment evolves, a firm’s culture can inhibit its ability to adapt. Cultural assets can depreciate, and one of the most difficult tasks for top management is to know when and how to replace elements of a culture that otherwise had served to keep the enterprise sturdy and reliable.”
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    Arnold Kling reviews a book that has appeared on these pages before, but the reason I put this article up here is because it helps you understand an important point about America today: it’s reviling of the corporate culture is very real – and Tyler Cowen says perhaps misplaced. Useful to think about how one should think about what made America great, and how perhaps it is changing – for the better or otherwise is your opinion entirely.
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  5. “Before I left, I asked the black waiter, Darick Thomas, how he felt about my hat. “I don’t care. At all. Really. At all! I look at a hat and that doesn’t tell me who the person is,” he said. “I’m not against Trump. He says some smart things; he says some dumb things.” Darick didn’t vote. “Voting is the illusion of choice for the masses,” he explained.”
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    What happens if you were a MAGA hat in a famously liberal restaurant in LA? This is, of course, at best an anecdote – but an enjoyable one, nonetheless.

Links for 5th June, 2019

  1. “But I think Guo is here engaging in a strategy that is common for those who want to nudge the Chinese system in a more market-oriented direction: they tend to describe things are being more competitive and market-driven than they actually are, so that marginal change in that direction seems unremarkable and logical. If you pound the table and call China’s state-owned enterprises a core interest of the nation, it becomes quite difficult to change them. If you say, China is mostly a market economy already, then gradually reducing the role of SOEs over time seems pretty unthreatening.”
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    Andrew Batson’s blog is entirely worth following (and for a variety of reasons!). In fact, the second link today will also be from his blog. But for the moment, let’s focus on how China might respond to America’s push against China’s State Owned Enterprises (SOE’s).
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  2. “Local governments discovered they could borrow basically without limit to fund infrastructure projects, and despite many predictions of doom, those debts have not yet collapsed. The lesson China has learned is that debt is free and that Western criticisms of excessive infrastructure investment are nonsense, so there is never any downside to borrowing to build more infrastructure. China’s infrastructure-building complex, facing diminishing returns domestically, is now applying that lesson to the whole world.”
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    Andrew Batson has a rather more optimistic take on the Belt and Road Initiative. Not as bad, as he mentions, as Brahma Chellaney makes it out to be. On the other hand, I still do think that Batson is far too optimistic about it – as usual, the truth lies somewhere in the middle!
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  3. “The strategy we have in mind would comprise three mutually reinforcing components: an increase in the skill level and productivity of existing jobs, by providing extension services to improve management or cooperative programs to advance technology; an increase in the number of good jobs by supporting the expansion of existing, local firms or attracting investment by outsiders; and active labor-market policies or workforce-development programs to help workers, especially from at-risk groups, master the skills required to obtain good jobs.”
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    Dani Rodrik writes about how to create “good jobs”, and lots of them. I don’t think what he suggests will likely work, especially in a country like India, for a variety of reasons – but the biggest is that the kind of top-down, bureaucratic approach he suggests simply hasn’t worked in the past.
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  4. “The overall trend was an incredible intensification of output. Splitters, one of the most skilled positions, provide a good example. The economist John Commons wrote that in 1884, “five splitters in a certain gang would get out 800 cattle in 10 hours, or 16 per hour for each man, the wages being 45 cents. In 1894 the speed had been increased so that four splitters got out 1,200 in 10 hours, or 30 per hour for each man – an increase of nearly 100% in 10 years.” Even as the pace increased, the process of de-skilling ensured that wages were constantly moving downward, forcing employees to work harder for less money.”
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    An extremely readable extract from a book called The Red Meat Republic, this article in the Guardian speaks to how America’s beef industry came to be what it is. A great read for students of Industrial Organization, labor economics, development, pricing, transport economics – and more besides.
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  5. “China has an industrial policy whose goal is to be competitive in these [branded goods] and other areas. Tariffs will limit profits for these companies and prevent Chinese products from achieving full economies of scale. So this preemptive tariff strike will hurt the Chinese economy in the future, even if it doesn’t yet show up in the numbers.”
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    Tyler Cowen often forces himself to write the viewpoint on the other side – or at least, that’s how I interpret this article. I’m sharing it partly because it is worth reading (that’s a given, right?), but more so because that trait is worth emulating: force yourself to argue from the other side’s viewpoint. Whether in writing, or just as a thought exercise.

Links for 29th May, 2019

  1. “And so India will continue to grow at her sluggish pace; socialism will continue to thrive; Air India will continue to fly; and Modi will continue to waste a fifth of our yearly budget on PSUs. Modi always knew that the secret to winning elections is socialism. What he has learnt now is the secret to running India. It is to gamble.”
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    I have posted this link not because I agree with the conclusion (I don’t), but because I share the sense of pessimism when it comes to matters pertaining to economic reforms, or the lack of them. India needs me, and the author, to be completely wrong about our pessimism.
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  2. “Zahran Hashim, 33, radical preacher and alleged ringleader, found little acceptance in his hometown Kattankudy, in eastern Batticaloa. Mosques in the predominantly Muslim town rejected him outright. Their members even complained to authorities, before he went absconding in 2017 after a clash with a fellow priest who challenged his interpretation of Islam.But soon, a team of young Muslim men — and one woman — from other, mostly Sinhala-majority, areas eagerly joined him on his Easter mission to carry out a suicide attack on churches and high-end hotels in and around Colombo and Batticaloa. All nine bombers were in their 20s and 30s.”
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    A mostly depressing, but also revealing, portrait of the nine people who perpetrated the terror attacks in Sri Lanka recently.
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  3. “There are striking parallels between the philosophies of Trump and NIMBY urbanists. Trump asserts that America is “full” and so wants to restrict the flow of immigrants. The urbanists, who tend to be Democratic and highly educated, assert that their cities are too crowded and so want to restrict the supply of housing. The cultural valence of the two views is quite different, but the practical implications have a lot in common — namely, a harder set of conditions for potential low-skilled migrants to the U.S.”
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    As he so often does, Professor Cowen reminds us why studying economics is entirely worth our time. In this case, he explains why NIMBYism, and high minimum wages are at least as anti-immigration as are, well, walls.
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  4. “Our goal is to defeat the snail in a race.”
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    Possibly the shortest extract I have put up ever, but it is hard to improve on that sentence. For once, I won’t speak about what the link is about. Try guessing what it might be about before clicking here!
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  5. “What’s happening here is much more complicated than an imagined zero-sum game between the defenders of books and library futurists. The decline in the use of print books at universities relates to the kinds of books we read for scholarly pursuits rather than pure pleasure, the rise of ebooks and digital articles, and the changing environment of research. And it runs contrary to the experience of public libraries and bookstores, where print continues to thrive.”
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    The Atlantic on substitutes and complements. On books actually, but read this article to understand how to think about the implications of thinking about complements and substitutes

Links for 7th May, 2019

  1. “Cyclone Fani slammed into Odisha on Friday morning with the force of a major hurricane, packing 120 mile per hour winds. Trees were ripped from the ground and many coastal shacks smashed. It could have been catastrophic.

    But as of early Saturday, mass casualties seemed to have been averted. While the full extent of the destruction remained unclear, only a few deaths had been reported, in what appeared to be an early-warning success story.”
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    A short read from the NYT about how Odisha was rather more prepared this time around for Cyclone Fani. Makes for encouraging, happy reading!
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  2. “Perhaps the earth has life because it came from other solar systems, seeded by alien probes, and indeed that is what I would do if I were a very wealthy alien philanthropist. If you end up with 100 successfully seeded solar systems for each very advanced civilization, the resulting odds suggest that we are indeed the result of a seed.That’s partly why, to this observer, the most likely resolution of the Fermi paradox is this: The aliens have indeed arrived, through panspermia — and we are they.”
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    An equally short, equally interesting take on aliens and the Fermi paradox from Tyler Cowen.
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  3. “We Are Pro-Technology, but only as a means, not an end. Technology is only as good as our understanding of it, and an incremental approach will save more lives in the near and long term while mitigating the second order consequences of an all-or-nothing approach.”
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    I was sent this by Aadisht Khanna, and while I do not necessarily agree with all of it, it does raise some fairly interesting points – and the manifesto itself is certainly food for thought.
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  4. “This looks quite tough, and there’s a significant chance the company will be valued at less than the debt itself, even if there was a buyer. After all if a buyer is paying that much money, why doesn’t he just start a new airline (or acquire a significant stake in an existing airline) and take over whatever slots, planes and rights Jet had? That’s likely to be much cheaper.”
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    Deepak Shenoy ponders the question of Jet Airways unusually high share price, and is unable to resolve the paradox.
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  5. “Without going too far down this rabbit hole, the following is worth noting: What sport psychologists, coaches, parents and players are prescribing as a model of mental toughness is equally likely to be the success-producing traits of highly successful and highly functional psychopaths. I have worked with a few psychopaths. I’ve seen the so-called attributes of mental toughness in them, which help deliver results on the field. I have seen how fans, friends and the media adore these people. But I have also seen what it looks like when their mental toughness is unmasked as psychopathic behaviour. They come across as being narcissistic and entirely self-serving, compulsive (and clever) liars, manipulators without any remorse and an inability to take responsibility for their errors. These are not qualities we should encourage as general conditions for performance.”
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    A fascinating article in Cricinfo about mental toughness, and how it doesn’t really exist – at least, not the way you think it does.