MetaFilter posts tagged with Economics

The Myth of Nazi Efficiency

Miko — Sat, 18 May 2013 07:21:04 -0800

Science fiction novels for economists

brundlefly — Wed, 15 May 2013 12:50:31 -0800

Science fiction novels for economists [via Paul Krugman]

When Adam Smith and Karl Marx agree...

asnider — Thu, 09 May 2013 12:39:44 -0800

Ha-Joon Chang on why separating politics from economic policies is bad for democracy. What free-market economists are not telling us is that the politics they want to get rid of are none other than those of democracy itself. When they say we need to insulate economic policies from politics, they are in effect advocating the castration of democracy. (Related FPP.)

The Krugman Times

ThatFuzzyBastard — Wed, 08 May 2013 20:45:00 -0800

The Krugman Times, the beloved liberal economist version of Malkovich Malkovich.

Why Philosophers Should Care About Computational Complexity

cthuljew — Sun, 05 May 2013 20:47:20 -0800

"One might think that, once we know something is computable, how efficiently it can be computed is a practical question with little further philosophical importance. In this essay, I offer a detailed case that one would be wrong. In particular, I argue that computational complexity theory---the field that studies the resources (such as time, space, and randomness) needed to solve computational problems---leads to new perspectives on the nature of mathematical knowledge, the strong AI debate, computationalism, the problem of logical omniscience, Hume's problem of induction, Goodman's grue riddle, the foundations of quantum mechanics, economic rationality, closed timelike curves, and several other topics of philosophical interest. I end by discussing aspects of complexity theory itself that could benefit from philosophical analysis."

A threadbare set of ideas

spamandkimchi — Wed, 01 May 2013 01:40:40 -0800

The Austerity Delusion: Why a Bad Idea Won Over the West. "Austerity is a seductive idea because of the simplicity of its core claim -- that you can’t cure debt with more debt. This is true as far as it goes, but it does not go far enough. Three less obvious factors undermine the simple argument that countries in the red need to stop spending. The first factor is distributional, since the effects of austerity are felt differently across different levels of society. The second factor is compositional; everybody cannot cut their way to growth at the same time. The third factor is logical; the notion that slashing government spending boosts investor confidence does not stand up to scrutiny."

If she weighs the same as a duck... she's made of wood!

blahblahblah — Tue, 30 Apr 2013 19:55:50 -0800

Trials by Ordeal were a method of determining guilt or innocence by putting the accused through various torturous experiences. Today these approaches are frequently-mocked and banned almost everywhere, though Sassywood remains common in Liberia. However, economist Peter Leeson argues that trial by ordeal may have been a very effective way of dispensing justice, especially when courts and juries were expensive or broken. According to the paper [PDF], a superstitious belief in iudicium Dei, or the justice of God, may have discouraged the guilty from ordeals, while tilting the scales in favor of the innocent - echoes of the practice persist today in swearing on a Bible. Even Sassywood [pdf] may be better than Liberia's broken justice system.

All those verbal gaffes were just strategery.

zardoz — Thu, 25 Apr 2013 14:30:54 -0800

Keith Hennessey is a former economic aide to George W. Bush. And he wants you to know that George W. Bush is smarter than you.

'The ECB with hereditary leadership and the right to employ an army'

Chipmazing — Fri, 19 Apr 2013 23:14:14 -0800

"All this gives us one way to understand the Lannister zeal for power in King's Landing. In effect, Tywin is attempting to execute a debt-for-equity swap since his debts aren't actually recoverable. But that simply underscores the extent to which the loans to the Iron Throne are, themselves, worthless as financial assets." Economics of Ice & Fire, Part I and Part II (minor dialogue spoilers for S03E03) An interesting comment from Steven (scroll to near the bottom)

Gold Crash

Slap*Happy — Thu, 18 Apr 2013 07:21:58 -0800

"Gold's crash this weekend is, as Oprah might say, a teachable moment. Crashes like this are a good way to find out how markets work. It's like a game of financial Clue, a way to keep sharp your skills of deduction. You don't have to be a stock investor or a math whiz to figure it out, either – you just have to have a good grasp of news and human psychology." - the Guardian on this week's crash in gold commodity prices.

The Day Care Dilemma

zarq — Mon, 15 Apr 2013 09:30:27 -0800

"Trusting your child with someone else is one of the hardest things that a parent has to do — and in the United States, it’s harder still, because American day care is a mess. About 8.2 million kids—about 40 percent of children under five — spend at least part of their week in the care of somebody other than a parent. Most of them are in centers, although a sizable minority attend home day cares.... In other countries, such services are subsidized and well-regulated. In the United States, despite the fact that work and family life has changed profoundly in recent decades, we lack anything resembling an actual child care system. Excellent day cares are available, of course, if you have the money to pay for them and the luck to secure a spot. But the overall quality is wildly uneven and barely monitored, and at the lower end, it’s Dickensian."

What's The Question About Your Field That You Dread Being Asked?

the man of twists and turns — Sun, 14 Apr 2013 07:19:35 -0800

"Maybe it's a sore point: your field should have an answer (people think you do) but there isn't one yet. Perhaps it's simple to pose but hard to answer. Or it's a question that belies a deep misunderstanding: the best answer is to question the question."

Smaller Wallets, Larger Households?

The Whelk — Fri, 12 Apr 2013 09:54:43 -0800

A dozen ultraleft voluntarists arguing about shower schedules is a noise complaint; 120,000 downwardly mobile yuppies doing it out of necessity is a substratum. The material realities of declining wages, ballooning debt, and skyrocketing rents at the core of the neoliberal city have conspired to herd young people into unprecedentedly dense, poor, and precarious kinds of living arrangements. - Andrew Fogle on how the economic crisis is changing how people live together.

"like most of the working class, I’ve developed a locust morality."

the man of twists and turns — Thu, 11 Apr 2013 14:50:48 -0800

The Locust Economy

I was picking the brain of a restauranteur for insight into things like Groupon. He confirmed what we all understand in the abstract: that these deals are terrible for the businesses that offer them; that they draw in nomadic deal hunters from a vast surrounding region who are unlikely to ever return; that most deal-hunters carefully ensure that they spend just the deal amount or slightly more; that a badly designed offer can bankrupt a small business. He added one little factoid I did not know: offering a Groupon deal is by now so strongly associated with a desperate, dying restaurant that professional food critics tend to write off any restaurant that offers one without even trying it.

...

Locust swarms are aggressively and energetically social. Remind you of any contemporary pattern of human behavior?

"It isn’t the 1% fat cats who are becoming victims of the new economy. It is the little capitalist in the middle." REVIEW: The Locust And The Bee: Predators And Creators In Capitalism's Future

What next after capitalism?

BillW — Tue, 09 Apr 2013 09:40:13 -0800

Recent posts here, here and here discuss a growing sense that climate change is going to be worse than we thought. A link to Charles Stross's musing on a future that included climate change was discussed on MeFi here. But Kim Stanley Robinson asks a slightly different question: If capitalism is the driver of climate change, what happens next? What does post-capitalism look like?

The best of the web - that'll be $30, please

Gyan — Fri, 29 Mar 2013 05:37:48 -0800

Open access: The true cost of science publishing

We're Going To Have To Find Out How To Deal With Lots Of Idle Hands

The Whelk — Wed, 27 Mar 2013 11:53:03 -0800

The Forces Of The Next 30 Years - SF author and Mefi's Own Charles Stross talks to students at Olin College about sci-fi, fiction, speculation, the limits of computation, thermodynamics, Moore's Law, the history of travel, employment, automation, free trade, demographics, the developing world, privacy, and climate change in trying to answer the question What Does The World Of 2043 Look Like? (Youtube 56:43)

Incommensurable values

kliuless — Mon, 25 Mar 2013 20:42:30 -0800

Economists and the theory of politics - "why unions were often well worth any deadweight cost" abstract:

The standard approach to policymaking and advice in economics implicitly or explicitly ignores politics and political economy, and maintains that if possible, any market failure should be rapidly removed. This essay explains why this conclusion may be incorrect; because it ignores politics, this approach is oblivious to the impact of the removal of market failures on future political equilibria and economic efficiency, which can be deleterious. We outline a simple framework for the study of the impact of current economic policies on future political equilibria — and indirectly on future economic outcomes. We then illustrate the mechanisms through which such impacts might operate using a series of examples. The main message is that sound economic policy should be based on a careful analysis of political economy and should factor in its influence on future political equilibria.

viz. What kind of mass movement with truly powerful institutional support can take the place of unions? - "I agree with just about everything they say about the value of unions, but I also feel forced to acknowledge that it doesn't matter. As a truly powerful mass movement, unions are dead and they aren't coming back. This has left a gaping hole in American politics: Corporations and the rich continue to have enormous institutional power, while the working and middle classes have almost no one to speak for them. I figure that filling this hole is the most important problem the left has to address over the next decade or so. Unfortunately, I don't know how." cf. The Tyranny of Political Economy - "In reality, our contemporary frameworks for political economy are replete with unstated assumptions about the system of ideas underlying the operation of political systems. Make those assumptions explicit, and the decisive role of vested interests evaporates. Policy design, political leadership, and human agency come back to life... Expand the range of feasible strategies (which is what good policy design and leadership do), and you radically change behavior and outcomes." also btw...

Markets in almost nothing - "One of the first things I noticed when I started studying economics was that goods that can't be bought and sold are basically ignored."
Wealth and Motivations for Saving - "teach the public more about how wealth builds over time"
The Supply and Demand for Safe Assets - "Where do safe assets come from? Empirical evidence suggests that the private sector creates more near riskless assets when the supply of government debt is low and reduces privately-created near riskless assets when the supply of government debt is high."
The safe asset shortage - "Safe debts – or what is often called information insensitive assets, as they do not suffer from the types of financial frictions that are characteristic to other financial assets – play a major role in facilitating transactions for institutional investors. And, as we have learned in the recent years, they also play a major role in triggering financial crises when they lose their safety status and turn into information sensitive assets."
GDP, welfare and the rise of data-driven activities - "The worry today is not that investment in technology might not be as productive as we thought (the so-called computer paradox), but the fact that the economic value of the fast growing consumption and production of online data may not be adequately captured in official statistics."
Uncle Sam, venture capitalist - "AMERICA, like much of the world, is facing a crisis of innovation. Its roots rest in several significant challenges: an awareness that rapid technological progress and growth will be crucial in weathering demographic headwinds and the threat of climate change among them. But there is very little consensus in Washington on just what the government ought to be doing to help."
What Google Reader tells us about banking and nationalisation - "Which is why the government taking charge of a service like RSS for the benefit of the public good — or for that matter providing the country with universal internet or high quality media — should not necessarily be treated with suspicion or mistrust. In the civilized world there is a perfectly reasonable way to ensure arm's length detachment and to protect such institutions from the political meddling of government."
If You Can't Fix It, You Don't Own It - "Who owns our stuff? The answer used to be obvious. Now, with electronics integrated into just about everything we buy, the answer has changed. We live in a digital age, and even the physical goods we buy are complex. Copyright is impacting more people than ever before because the line between hardware and software, physical and digital has blurred. The issue goes beyond cellphone unlocking, because once we buy an object — any object — we should own it. We should be able to lift the hood, unlock it, modify it, repair it... without asking for permission from the manufacturer. But we really don't own our stuff anymore (at least not fully); the manufacturers do. Because modifying modern objects requires access to information: code, service manuals, error codes, and diagnostic tools."

like think about sovereign debt -- that is safe assets -- more as a national equity: [1,2,3,4,5]

The US national debt is in truth - like all national debts - a complete and surreal fiction: it is a national equity, the greater part of which is interest-bearing either as claims over public or private revenues. At least two-thirds of the quasi tax credits created by banks came into existence as mortgage loans, and are therefore backed by claims over the productive value of the US land and buildings which they fund. Much of the rest consists of claims over the value of US assets which fund the productive capacity of US corporations. The remainder - which provides the credit necessary to finance the circulation of goods and services in the US - is based upon the magnificent productive capacity of the US people. Only by liquidating US Incorporated could this National Equity ever be redeemed... There is no shortage of dollars because every dollar's worth of productive capacity - public or private; productive people or productive assets - in the US is the capacity to issue a dollar credit, which reflects the increase in the US national wealth which underpins the US national equity. President Barack Obama and his government should get busy creating national equity by instructing the Fed to create and issue the necessary finance for the creation of a new generation of US infrastructure; the transition to a low carbon future which the US can, and should, be leading; and in increasing the capacity of the US people to do so.

(or how the government budget constraint is different than a household's or corporation's -- namely that they can tax and can't be liquidated, unless extraordinarily mismanaged or conquered, I guess...)

The economics of time travel

medusa — Mon, 25 Mar 2013 04:42:28 -0800

Would time travellers affect security prices? An article by Richard Hudson. Inspired by this metatalk post.

Putting the "I" in IPO

reenum — Sat, 23 Mar 2013 17:50:37 -0800

Mike Merrill decided to sell shares in his life. He now has 160 shareholders who can tell him what to do.

sea & sky

kliuless — Mon, 18 Mar 2013 20:11:11 -0800

seaQuest: what if we could learn to live on/underneath the oceans (or in orbit)? [prev iou sly(er)] also btw... -Why Utopia? -Envisioning Real Utopias -Utopianism, Conservatism, Ideal Theory: Who is Trying to Get Where, From Here?

The Economics of Spam

frimble — Sat, 16 Mar 2013 01:14:57 -0800

A paper from Justin M. Rao and David H. Reiley in the Journal of Economic Perspectives (full-text pdf) about spam economics.

Spam also seems to be an extreme externality in the sense that the ratio of external costs to private benefits is quite high. We estimate that American firms and consumers experience costs of almost $20 billion annually due to spam.... On the private-benefit side... we estimate that spammers and spam-advertised merchants collect gross worldwide revenues on the order of $200 million per year. Thus, the "externality ratio" of external costs to internal benefits for spam is around 100:1.

Summary from the Atlantic Is Spam a Public Policy Problem? (Previously, previously)

echoes

kliuless — Sat, 02 Mar 2013 10:40:34 -0800

A brief history of the Chinese growth model [note: not so brief] - "the Chinese development model is an old one, and can trace its roots at least as far back as the 'American System' of the 1820s and 1830s. This 'system' was itself based primarily on the works of the brilliant first US Secretary of the Treasury Alexander Hamilton..."

The American System was developed in opposition to the then-dominant economic theories of Adam Smith and David Ricardo, in part because classic British economic theory seemed to imply that reductions in wages were positive for economic growth by making manufacturing more competitive in the international markets. A main focus of the American System, however, was... Sustaining high wages... thereby both driving productivity growth and creating a large domestic consumption market for American producers...

First U.S. Bank Regulations May Look Strikingly Familiar - "One hundred fifty years ago, the U.S. was two years into a brutal Civil War. The financial cost left the federal government under enormous stress, leading to a result no one had imagined: the first modern system of bank regulation." more from Echoes: -Why the Founding Fathers Loved the National Debt -Piracy and Fraud Propelled the U.S. Industrial Revolution -The British Bank That Forever Altered the U.S. Economy -Founding Father of the Quants Was Revolutionary Marxist also btw... Casualties of Credit: The English Financial Revolution, 1620-1720

Modern credit, developed during the financial revolution of 1620–1720, laid the foundation for England's political, military, and economic dominance in the eighteenth century. Possessed of a generally circulating credit currency, a modern national debt, and sophisticated financial markets, England developed a fiscal-military state that instilled fear in its foes and facilitated the first industrial revolution. Yet a number of casualties followed in the wake of this new system of credit. Not only was it precarious and prone to accidents, but it depended on trust, public opinion, and ultimately violence.

Economic Development in the Americas since 1500: Endowments and Institutions

Relative to the baseline provided by Canada and the Northern United States, the most important institutional divergences of the Caribbean and Latin America that they see come in the areas of suffrage, education, and land policy... institutional trajectories once embarked upon became very difficult to change... The political power of the entrenched and unequal elite simply turned out to be too great. This is a brilliant book, an example of what economic historians do best--better than non-economic historians, and better than non-historical economists.

Sociology (and other group data) assumptions based on Americans.

aleph — Mon, 25 Feb 2013 13:27:58 -0800

And that's a bad idea. Much of standard group behavior data in Sociology/Economics/Psychology is based on Americans. Which don't seem (contrary to universal assumptions) to be shared by a lot of the World.

Students all over the world are demanding a new curriculum.

infini — Wed, 13 Feb 2013 09:25:28 -0800

A Renaissance in Economics The American President Ronald Reagan once quipped, “The nine most terrifying words in the English language are, ‘I’m from the government and I’m here to help.’” I get the same shivers when someone introduces themselves as an economist.