WB’s chief econ Justin Lin picks lyrics from Paul McCartney’s song:
Archive for May 22nd, 2012
Why Indians prefer social convention to rigid rules
May 22, 2012Niranjan Rajadhyaksha in his terrific new column – The Impartial Spectator –twists the debate:
The entire debate on why the Indian govt has been unable to spend enough on things that benefit all citizens may then have to be reconsidered in terms of our own social preferences, more specifically our historical inability to broaden the arc of cooperation.
He points to a lecture by Avinash Dixit:
Game theory in Repo markets..
May 22, 2012I have always been thinking about how game theory can be used to understand repo markets. I mean it is a classic market for applying game theory ideas given the dynamic nature of both the fields.
Somebody has surplus funds, somebody has securities to offer. Should the lender offer funds to the bank or to the central bank? Should the borrower borrow from markets or central bank?
Huberto Ennis of Richmond Fed provides some ways to look at the issues in this paper:
Improprieties of the Pretense of Knowledge
May 22, 2012A nice speech on the topic by Daniel Klein of GMU. I posted about his views on central banking a while ago.
Coming from the Austrian School, speaking on such topics is like a cakewalk.
Knowledge has its counterpart in action, and your actions emerge from your normative calls in personal policy-making. On those two steps I propose to bring to the traditional Hayekian knowledge problem a prism of Smithian moral analysis. This approach perhaps sheds new light on the absurdities and profound quackishness of statist pretenses of knowledge.
He discusses how Knowledge entails three facets, information, interpretation, and judgment. We usually focus on information but not much on interpretation which is far more critical. There is a nice Sherlock Holmes story to show the difference.
The broader criticism is on government and regulators who seem to think they know what to do/regulate etc.
Nice bit…
