Archive for August 2nd, 2017

From a thriving bazaar to a garbage-strewn dump: Tracing the history of Bengaluru’s KR Market

August 2, 2017

A nice piece by Theja Ram on history of Bangalore’s famous K.R. Market. The initial KR stand for Krishna Rajendra Wadiyar who gave the market an uplift in 1921.

What is interesting to know is that the KR market was a battle ground earlier:

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RBI discloses more information related to voting behavior of MPC members

August 2, 2017

The much anticipated monetary policy decision was is in line with expectations: A 25 bps cut in Repo rates.

Much of the statement is the same old story with not much difference. Though, there was one difference.

In previous Resolution statements, RBI just said an X member was not in favor but did not tell what did the X member vote for. The details were released in MPC minutes. For instance, previous policy said:

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The Secret Economic Lives of Animals: Economics isn’t just a human activity….

August 2, 2017

Fascinating piece by Ben Crair:

Economists study human behavior. “Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog,” Adam Smith sniffed in The Wealth of Nations. The ability to “exchange one thing for another,” he declared, “is common to all men, and to be found in no other race of animals.” Later economists, inheriting Smith’s self-regard, rechristened man Homo economicus in the belief that rational self-interest defined the human species. Even John Maynard Keynes, the father of modern economics, attributed our irrational choices to “animal spirits.”

But an animal spirit can actually be entrepreneurial. Consider a January study about paper wasps from the journal Nature Communications. A female paper wasp will recruit “helper” wasps to her nest to raise her offspring, and these helpers can usually choose from several different nests in a given area. The wasps are essentially making a trade: The top female offers helpers membership in her nest in exchange for childcare, and she can kick out a helper who doesn’t pull its weight.

What’s remarkable is that the terms of the wasps’ trade are determined by supply and demand. When the paper’s authors increased the number of nests in the field, they found that females were willing to tolerate smaller contributions from their helpers. The paper wasps behaved like any rent-seeking landlord, just as an economist would predict. A greater overall supply of wasp nests lowers the price of entry into any single nest. “In order to predict the level of help provided by a subordinate, it is necessary to take into account the state of the surrounding market,” the authors wrote.

If Adam Smith had strapped on a bee suit—or a safari jacket, or a scuba mask—he could have discovered that the animal kingdom is, in fact, a chamber of commerce.

Wow..

Thinking about dominance of language and currency (Kindleberger edition)…

August 2, 2017

Timothy Taylor on his blog shares a superb paper by Charles Kindleberger.

Kindleberger was one of the few economists who wrote with lots of flair and clarity. His pieces were minus all the models and math jazz but were quite rigorous in their own way and made you think about several issues.

However, the analogy which interests me most is that between the use of the dollar in international economics and the use of the English language in international intercourse more generally. Analogies are tempting, and dangerous because frequently misleading. But the dollar “talks,” and English is the “coin” of international communication. The French like neither fact, which is understandable. But to seek to use newly-created international money or a newly-created international language would be patently inefficient.

Languages are ordered hierarchically. Like sterling, French used to dominate. Like the dollar, English does now. Frenchmen must learn English; it is not vital for Anglo-Saxons to learn French.

The analogy with the language quarrel in Belgium is exact. The Flemish must learn French, but the Walloons, despite their constitutional edict of equality between the languages and the legislative edict which requires civil servants to do so, do not learn or use Dutch. The Flemish are offended and begin to insist on Flemish, exactly as France has insisted that its representatives at international conferences, even when they know English perfectly, must speak only French and insist on all speeches in English being translated into French. The transactions costs of translation, including the misunderstanding in communication and the waste of time, are even more evident than the transactions costs of converting gold to dollars and dollars to gold, when it is dollars—not gold—that are necessary to transactions.  …

It is easy to imagine what is implied in a “sabotage” of French as a working language at the United Nations. Someone—presumably an Anglo-Saxon—at a working-committee meeting, observing that all the Francophones had a good command of English, suggested that the translation into French from English and possibly from French into English be dispensed with in the interest of efficiency. The transactions (translation) costs of simultaneous but especially of consecutive translation are high in efficiency, owing to loss of time or accuracy and of intimacy in two-way communication. It is highly desirable for Americans and British to know enough French, German, Italian, Spanish, and perhaps Russian to be able to receive in those languages, or some of them, even if they transmit only in English. But world efficiency is achieved when all countries learn the same second language, just as when the different nationalities in India use English as a lingua franca. …  One’s own currency is the native language, and foreign transactions are carried on in the vehicle currency of a common second language, the dollar.

It is hard on French, which used to be the language of diplomacy, to have lost this distinction; but it is a fact. In scientific writing, as in communication between international airplane and control tower, English is the universal language, except for the rescue call “Mayday” which … would have put in French as “M’aidez.” But a common second language is efficient, rather than nationalist or imperialist. 

Fascinating.

Bangalore AC bus Service losing passengers due to competition from other transport services….

August 2, 2017

Interesting bit of news in Bangalore Times of India.

The AC Bus Service in Bangalore is called Vajra and is a mascot for BMTC. Both its driver/conductor and the passengers had this haughty attitude travelling in the bus looking at passengers waiting for cheaper non-AC buses.

Now the AC bus service is getting competition from AC ride sharing taxis and the Metro. Its sales revenues have dipped leading to concerns:

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