Archive for February 11th, 2014

German constitutional court ruling on ECB’s OMT…

February 11, 2014

You can never really leave EZ out of action….It had been quiet for sometime and then comes this interesting verdict by German constitutional court. It says that ECB’s Outright Monetary Transactions are against the EU law. The EU law states that monetary financing of Eurozone governments is not allowed and OMT just does that.

Hans Werner Sinn and Marcel Fratzscher write their perspectivess for and against the decision.

Now not a penny has been spent on OMT since it was announced in 2012  but worked as a magic pill to stabilise the markets. But it took so long to produce the verdict which makes things look really crazy. If it was produced in 2012 itself, may be EZ would have struggled to stabilise.

Given the central bank activism, we need to have faster court verdicts in such cases. If a policy is against a certain law etc and court sits on it for months, it does not help. For instance, if money was spent on OMTs, what would ECB have done?

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Linking Maruti 800 history with Indian economic history

February 11, 2014

A nice piece by Anil Padmanbhan of Mint.

He says how history of Maruti 800 is connected to history of India’s economic reforms (which did not start in 1991):

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Why are we surprised by the decline of Emerging economies?

February 11, 2014

Because we thought this time is different.

Dani Rodrik says decline of emerging economies is on expected lines:

This is not the first time that developing countries have been hit hard by abrupt mood swings in global financial markets. The surprise is that we are surprised. Economists, in particular, should have learned a few fundamental lessons long ago.

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An Economist’s Guide to Visualizing Data…

February 11, 2014

Jonathan A. Schwabish of Congressional Budget Office has this really useful article on doing research. He focuses on how we can improve the graphs etc in the various papers.

For economists who want readers to apprehend results quickly and accurately, presentation matters. Effective visualizations show the data to tell the story, reduce clutter to keep the focus on the important points, and integrate the text with the graphs to transfer information effifi ciently. With the increased flfl exibility of even fairly basic software programs (like Excel), it is now more cost-effective in terms of time and energy for researchers to invest some time learning and thinking about the details of graphical presentation.

To create great, effective visualizations, carefully consider the needs of your audience—the numbers, facts, or stories that will help them understand your ideas and your arguments. Consider the interfaces—static versus interactive—they will use. And pair the depth and clarity of your data, models, and writing with visualizations that are just as clear and compelling.

 Author shows how certain graph styles can be changed to make it look more effective. There are three principles one shd focus on: show the data, reduce the clutter and integrate the text and the graph..

Very useful…

 

 

 

Delhi’s water supply – Going, going, gone? (applies to most cities in India)..

February 11, 2014

Asit K Biswas (of  Lee Kuan Yew School of Public Policy, Singapore.) & Cecilia Tortajada (of Third World Centre for Water Management, Mexico) have written this stirring piece. They have written a book on how Singapore improved its water supply system and must be quite a read.

The piece is on woes of Delhi Water supply but it applies to most Indian cities. For instance, Bangalore is sitting on a water time bomb with all kinds of issues.

They point how Delhi which had good quality of water in 1950s has such poor quality now:

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