Well, there is some hope from the subject atleast.
An interesting case of how Christine Exley and Elena Battles are using economics (market design principles) to hemp homeless puppies find homes:
As we keep ignoring the basics, the mess is just piling across Indian cities. As scholars and media celebrate the rising urbanisation in India, Indian citizens are not one bit amused. It is leading to multiple hazards.
This should have come long ago. One keeps wondering why should an IPO prospectus be so so long? There is close to zero chance any investor (barring the biggies) reads the mammoth prospectus leave alone the retail investors.
As per recent SEBI notice, a company going for an IPO needs to issue a 10 page abridged prospectus as well. It has issued broad guidelines on what to be included in the abridged version:
Vivek Kaul has a piece on Dalonomics. He says the incentives are not right for farmers to grow more pulses. Well, the problem is not limited to pulses alone. Every quarter or so, we have a problem with potatoes or onions or tomatoes and so on. The list just keeps expanding. The problem is incentives are distorted for farming in general. After pulses, there will be something else..
Meanwhile, the prices of dal related items is zooming as well. The eateries across the country are responding in different ways – Dakshin Kannada is cutting size of Vadas, AP village knocks off sambhar from menu, Mumbai eateries are waiting and those in Bangalore have increased the prices.
Most eateries had already increased prices due to rising prices of veggies mentioned above. And now another round due to pulses as well. What is worse is that the prices of veggies and pulses may come lower but menu prices are stickier and remain there.
On top of that in states like Karnataka one pays tax of 20% (14.5% – VAT and 5.5% Service Tax) to eat in restaurants. I mean how priceless it has become to even eat in the country..
Chris Edwards of Cato has a nice post on the topic.
Being from Cato his answer is of course private. There is some research backing the view as well..
In researching an upcoming study on privatization, I came across an interesting illustration of the advantages of private science over government science. Private science focuses on efficiency and results, but government science maybe not so much.
The study by Jonathan Karpoff in the Journal of Political Economy found:
From 1818 to 1909, 35 government and 57 privately-funded expeditions sought to locate and navigate a Northwest Passage, discover the North Pole, and make other significant discoveries in arctic regions. Most major arctic discoveries were made by private expeditions. Most tragedies were publicly funded. By other measures as well, publicly-funded expeditions performed poorly. … Although public expeditions made some significant discoveries, they did so at substantially higher cost (as measured by crew size or vessel tonnage) than private discoveries.
Historical accounts indicate that, compared to private expeditions, public expeditions: (1) employed leaders that were relatively unmotivated and unprepared for arctic exploration; (2) separated the initiation and implementation functions of executive leadership; and (3) adapted slowly to new information about clothing, diet, shelter, modes of arctic travel, organizational structure, and optimal party size. These shortcomings resulted from, and contributed to, poorly aligned incentives among key contributors.
My upcoming study will look at the advantages of privatizing federal activities such postal services, air traffic control, and passenger rail. But policymakers should also explore the advantages of privatizing federal science activities.
Cato adjunct Terence Kealey has written about the advantages of private over government science, and he will discuss that topic at an upcoming Chicago seminar.
Meanwhile, if you plan to explore the Arctic, it would be best to go on a private rather than government ship. There would be less chance of getting scurvy–at least that’s the way it used to be, according to Karpoff.
Well efficiency is not just restricted to financial markets but in theft markets too.
As pulses prices soar across the country (Packet of pulses, the preferred Diwali gift this year), thieves have switched their choices as well. There are reports of pulses being stolen across the country – UP (whole truck is stolen), Nagpur etc.
This is a market which is banned by government but is quite rampant and efficient. As prices of certain items zooms, one sees theft of those and related items rise as well..
Well, there is some confusion. BS reports the ranking has jumped by 12 places from 142 in 2015 to 13o in 2016. Whereas the DB website says the rise is more modest from 134 to 130. An improvement nevertheless and welcome as well.
The rise comes from two sub-indicators- starting a business (from 164 to 155) and getting a electricty connection (from 99 to 70). The first one is really important given how pathetic the whole thing is in India. Though in electricity, I guess what matters also is whether one gets electricity as well! Getting an easier connection alone will not help.
What is weird as that getting credit ranking has slipped from 36 to 42 despite all this noise about financial inclusion and push to ease credit delivery. Perhaps it is got more to do with the idea that overall credit conditions are tight and growth lowest in many years.
Actually, one does not know what these rankings mean other than getting some euphoria and discussion in financial media. One may not do anything and still rise in rankings if other countries have done worse and so on. Then there are also these perennial problem of dejure rankings vs. defacto ones. Frankly, it is difficult to imagine that India can grow this fast with such poor rankings. Equally difficult is to imagine that growth will jump many times if these rankings improve.
But yes it surely improves the image of the country. For all you know, improvement in rankings will actually do more justice to India’s growth rates..
It is nice to bring this old phrase of competition between “brick and mortar companies vs dotcom companies” back to the discussion room.
As India (and the world) tries to revive e-commerce world, the old companies are again worried. There are these usual talks of how the new online world will capture the old market players. Least do they realise, how old players can actually fight the game given their huge cash and asset base, provided they get their act right. Unlike the doctcom players which live on very low cash and asset base, the old players are much sorted.
Here is a story on how Indian biggies are competing in the renewed online space:
This blog keeps arguing to move towards a world with less and less of central banking. Central banks evolved in times when banking was not well really understood as a business and may be there was a case for a central bank type of an organisation. Even then the interventions of central banks had more unintended consequences. Federal Reserve was formed to resolve banking panics but played a stellar role in aggravating the same in 1929. Same is the case with central banks worldwide as we are so clearly seeing now.
As a result, one is never sure which battle the central bank should fight and whether the strategy is right. A lot hinges on these decisions given their monopoly over monetary forces. In today’s context, some say central banks should maintain their focus on inflation and inflation targeting is the only game. Whereas others say it is not the right battle and they should switch to financial stability and move away from inflation targeting.
Stephen Roach belongs to the second camp and says they should instead focus on fin stability:
Well, as this blog keeps saying economics alone is not enough to win elections. Each election of any country, both the pink and white media keep stressing that only economics matters. If economy is fine, the ruling party has a chance else it has to be voted out. It all boils down to the narrative the party builds which has to be acceptable to the public.
Jacek Rostowski Poland’s Minister of Finance has an interesting piece on recent Polish elections. He wonders how the outgoing party – Civic Platform – actually lost the elections despite achieving a good economic performance:
In Indian finance industry, anything foreign is really important and carries enormous has weight. However, Indian public does not seem to buy the hype. Be it foreign banks or foreign mutual funds, most just fail to make an impact.
After huge hype over their entry, both Goldman and Nomura are exiting Mutual Fund space in India:
Prof. Frederic Payor of Swathmore College has had some experience in life. He was mistook for a spy in East Berlin due to his dissertation on Russian economy! The topic of dissertation was on the foreign trade system of the Soviet bloc.
All this interesting titbit was hardly known till Steven Spielberg/Tom Hanks did not play the events in their recent movie – Bridge of Spies.
In this interview, Prof Payor narrates the experience and how closely the movie captures reality:
One is only beginning to realise the contribution of some superb scholars in India whose works are largely unknown.
One such scholar was Prof. Suryanath Kamath (surprised to find his wiki page) whose work on history of Karnataka is exceptional. He was the tour de force behind Karnataka Gazetteers.
He just passed away recently. May his soul rest in peace.
This essay critically evaluates the benefits and costs of the dominant methodology in macroeconomics, the DSGE approach. Although the approach has led to great progress in some areas, it has also created biases and blind spots in the profession that hold back our understanding and our ability to govern the macroeconomy. There is great scope for progress in macroeconomics by judiciously pushing the boundaries of some of the methodological restrictions imposed by the DSGE approach.