Archive for the ‘Blogs to Read’ Category

Is US becoming a banana republic?

December 19, 2016

Scott Sumner has an interesting piece titled as Banana Republic watch:

How do you know when your country is becoming a banana republic?  Let’s call our imaginary banana republic “Costaguava”.

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Mostly Economics ranked in top 100 economics blogs..

December 19, 2016

Feedspot, a blog aggregator has ranked Mostly Economics amidst the top 100 economics blogs. It is currently at 44!

The Best Economics blogs from thousands of top Economics blogs in our index using search and social metrics. Data will be refreshed once a week.

These blogs are ranked based on following criteria

  • Google reputation and Google search ranking
  • Influence and popularity on Facebook, twitter and other social media sites
  • Quality and consistency of posts.
  • Feedspot’s editorial team and expert review

Hope it is a rigorous enough methodology! Along with Intelligent Economist badge, there is a badge from Feedspot on the blog page now.

It is amazing and humbling to feature in these rankings amidst the stalwarts of economics and economics blogging world. Thanks to all the visitors and supporters for making it happen.

One does not like these shameless self marketing posts but I guess it is fine sometimes…:-)

Issuing seperate currency in leper colonies…

December 12, 2016

Elaine’ s idle mind blog has a post which discusses another aspect of colonisation – leper colonies.

There was a belief that leprosy could spread via currency as well. This the masters issued a seperate leper currency in these colonies:

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Happy Diwali to Mostly Economics visitors

October 29, 2016

Wishing all Mostly Economics visitors a very happy and a prosperous Diwali. As this blog keeps saying and says it again. This blog is making Diwali (and other wishes) wishes for so many years mainly due to the several visitors. The lamp of the blog continues to be alive and all credit is to all of you.  May it continue for many years.

This Diwali one one is really confused about the appeal to ban/don’t use Chinese goods from several quarters. Economics obviously says such demands should be rejected but political economics considerations have some points to be considered. What do visitors think?

Anyways, have fun and be safe.

Renting a tractor the ola/uber way…

October 20, 2016

How lessons are transplanted from one industry to the other.

This bit is really interesting (HT: CB Blog). Mahindras have launched an app called trringo. The small farmers can just swipe and call a tractor. Just like we do for taxis using ola/uber:

Hailing a ride with your smartphone? That’s old news — ask any Uber, Lyft or Careem customer.

But how about hailing a tractor?

Just as urbanites may find it impractical to own a car but still need a ride once in a while, so, too, in the Indian countryside: To get the most from their land, small-scale farmers may need tractors and other machines from time to time, but they may not be able to afford their own.

Renting can be the answer, but the way it was done in India before was not very appealing to farmers. The process was usually informal and local, run by equipment owners who could be capricious or discriminatory, and prices tended to surge at the times of year every farmer in the area would be doing the same job and need the same equipment.

Mahindra & Mahindra, a major Indian vehicle manufacturer, thought there had to be a better way.

“One of the things that struck us was the toll it took on the self-esteem of the farmer,” said Rajesh Jejurikar, chief executive of the company’s farm-equipment division. “It was, literally, like having to beg for it. He didn’t feel like it was his right.”

So the company came up with a smartphone app, Trringo, which it rolled out in September in the state of Karnataka and will soon be available in other agrarian states like Gujarat, Madhya Pradesh, Maharashtra and Rajasthan.

Right now, a farmer can use the app to specify what is needed and when, and the company will send the requested tractor and a driver from one of about 20 hubs across Karnataka. The machine might belong to Trringo or to a private owner using the service to book rentals.

There is one snag: By recent estimates, only about 9 percent of rural India has mobile internet access. So the company has also set up call centers for farmers to arrange rentals by telephone.

Will be interesting to see how this experiment fares…

Future of Library in next 100 years: A novel initiative to keep books in demand

October 17, 2016

Katie Bennett of Oxford University Press has a post on a very interesting initiative taking place in Oslo, Norway.

The idea is to make some efforts to ensure both libraries and books remain relevant even 100 years later:

I want to live to be 100 years old. Yes, that is a bold statement, and I’ll admit this goal may be a bit unrealistic and potentially impossible, but my curiosity pushes me to beat the laws of nature. As a 22-year-old avid reader working for a publishing company, I can’t help but wonder: what will be the future of the printed book? Since the creation of the world wide web by Tim Burners-Lee in 1989 and it’s continual expansion since then, this question has haunted the publishing industry, raising profound questions about the state of the industry and the printed book. After the debut of the Amazon Kindle and the Barnes & Noble Nook, it seemed as if the days of print materials were numbered. Katie Paterson, founder of the Future Library of Norwa project, doesn’t seem to think so, and she’s got a plan to ensure their existence.

A renowned Scottish artist, Paterson is known for her grand-scale artistic ideas and endeavors. On 12 June 12 2014, Paterson began a century-long project as her way of preserving the future of the library and the printed book. Over 1,000 trees have been planted in the Nordmarka forest just outside of Oslo, Norway for the Future Library, called Framtidsbiblioteket in Swedish. These trees, only now just saplings, will grow to full maturity by 2114, ready to be harvested to print the most mysterious literary anthology ever compiled.

Each year, one prominent author submits an original manuscript of his or her writing—be it a poem, short story, novel, play, anything—and seals it in a box. For the next 100 years, that box will be kept in trust, unpublished, until 2114 when the future project leaders will publish the set of works submitted into printed anthologies available to the public. The New Deichmanske Public Library in Bjørvika, Oslo, opens in 2019 and will house the manuscripts in a specially designed room, lined with wood from the forest. Only the authors’ names and titles of their works will be displayed.

For the next 98 years, no one—not even Katie Paterson herself—will be able to read these submissions, and the authors of these works will most likely never experience the public’s reaction to their writings. In fact, most everyone who is currently working on this project with Paterson will never see the results of their efforts, and can only hope that the people to whom they entrust this project will continue their legacy in the ways directed. With hope, their grandchildren might be old enough to purchase a volume of the anthology, but even that’s no guarantee. In a world so consumed with providing a better existence for future generations, how selfless of an endeavor to work on a project the creator will knowingly never be able to enjoy.

Some authors have already begun to submit their anthologies. One can already buy a right to ensure delivery of the anthology when it opens to public in 2114.

What’s next in history of economics? A wish list

October 17, 2016

Beatrice Cherrier an upcoming economic hisotrian has a wishlist:

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How 2016 economics prize was inspired by Sholay (After all Salim/Javed were masters of contract writing..)

October 13, 2016

Manasi Phadke is back after a long break.

Her recent tweakonomics piece links the 2016 economics prize to the epic Bollywood film – Sholay:

The modern world rests on the foundations built by contracts. Contracts, when completed, when partially honoured, when inefficiently designed, lead to different scenarios that can be used to describe situations in the world of economics and sociology. It is for “launching contract theory as a fertile field of basic research” that the Nobel Prize in Economics for 2016 has been awarded to Oliver Hart and Bengt Holmström.

Year 1975. As fate would have it, Holmström, then a professor at Kellog’s Graduate School of Management, was bored. Life had become but a bowl of cereal. Paul Samuelson had already received his Nobel for unifying static and dynamic analysis. There was Kuznets who had had the last word in growth, and Kenneth Arrow who took the system from growth to welfare. In the process, if there were any fluctuations at all, Myrdal and Hayek had already explained them. Milton Friedman had had the last word on most of stabilisation theory and Ohlin broke the trade barriers. Aaaarrrrgh! Was there anything at all left to be analysed?

Frustrated, Holmström went home and idly flipped channels on TV. Lady Luck was watching. Had Holmström decided to watch the many antics of Lucille Ball, she would not have helped him. The world would then be a different place.

……

An Indian movie was being aired. There were people dancing to a song. And then suddenly came dacoits. The villagers ran helter-skelter and two good-looking young men shot at the dacoits, who were forced to return to their lair to face the wrath of the Sardar. “Kitne aadmi thhey?” asked the Sardar spitefully. How interesting! This guy, who is the principal dacoit, does not really know what his agents face in the field. The main fella has an objective function of dominating the local area with the help of Kalia et al., whose main objective is to bully and snatch food from villagers. How non-optimal! A breach of contract is imminent. Hmmm. How will the principal control his little gang of agents? “Jo darr gaya, samjho marr gaya.” Ouch!

But see how the coin flips (ahem, quite literally too, in the film). There’s this cop, who too is a principal working with the agents. He is not only armless, but also pretty much blind to field issues. But he is smart. He has the objective function spelt out: “Mujhe Gabbar chahiye. Zinda.” He keeps the money part of the contract simple. Half the amount to be paid at the beginning, half once the job is completed. This thakur tests his agents’ capabilities, gives them information over a spiffing cabaret performance to complete the contract, and in the end also uses the verbal promise made by one friend to emotionally fortify the terms of the contract.

“Brilliant!” thought Holmström feverishly. Every situation is basically an outcome of a contract, wisely or unwisely written. Let me put this down into an academic paper. As the thakur would have said, “Loha garam hain. Maar do hathauda.” The rest is history.

SEBI’s Social-Media Regulatory Overreach

October 10, 2016

Prof Jayant Varma points how SEBI is overdoing its regulation mandate. It has recently asked all stock advisers/tippers using all possible social mediums (whatsapp, Twitter, FB etc) to be first registered with SEBI before getting into advisory mode.

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Mostly Economics on a short break

October 6, 2016

This blog is on a short break. Blogging to resume by Monday hopefully. Till then cheers.

Struggles to open a bank in UK..

September 28, 2016

I had just posted on how an app based bank got a licence to open a limited bank in India. One might be tempted to think it is easier to open a bank in UK.

However, this is hardly the case. Kevin Dowd posts about struggles of Dave Fishwick to open a bank in the country:

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Short history of how Central Park in New York was built..

September 15, 2016

David Shulyer has a nice short history of the project that led to iconic Central Park.

He says it was one of the best investment NY has ever made:

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Where Do Monetary Rules Come From and How Do They Work?

September 14, 2016

David Glasner has an interesting post on thinking about mon policy rules.

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Why economics should be concerned with disappearance of teaching of economic history and history of thought?

September 8, 2016

It is all so ironical really. Post-2008, there has been a rise in interest in economic history and economic thought.

This is because of two reasons. One, people are beginning to understand that much of economics today is a result of series of events in the past. So, to understand today or forecast future, you need alteast some understanding of past matters. Two, as economics profession has lost a lot of credibility, it is increasingly looking at past for some credibility, This is especially the case for central bankers who are increasingly trying to justify their decisions bringing some connections with the past.

Ideally, the rise in interest should be based on first but even second is fine as atleast there is some discussion on these issues.

So what is the irony bit? Well, economic historians are not getting their due. Worse is that few remaining departments which encourage historical work are struggling to remain open.

David Warsh of economicprincipals.com laments the issues:

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Robot Macroeconomics: What can theory and several centuries of economic history teach us?

September 6, 2016

Bank of England may be clueless on what next, but its blog Bank Underground keeps giving us food for thought via its posts.

In the recent one, John Lewis looks at this question of how robotics will impact macroeconomics. Will it lead to lower jobs as said and so on. For this, he draws upon years of history where some new technology has replaced an existing one.

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Monetary Policy Family reunion at Jackson Hole :-)

September 2, 2016

Prof Perry Mehrling just nails it with this post. He says how The Jackson Hole this year was just another of those reunion of monetary policy families. It is a very tightly held family which is really difficult to break into. They have been either managing or shaping monetary policy for almost all the countries in the world.

It was a reunion as only one paper actually was based on the theme of the conference. Rest were just usual rambles. It seems most had just assembled to say hi to each family member and get family updates :

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Why it makes sense for an M.D. to lead the World Bank? (some insights from history of Indian banks too!)

September 1, 2016

World Bank’s recently appointed Chief economist Paul Romer in this post talks about why a Doctor of Medicine (MD) is a good fit to lead the world bank. After all his new boss his Jim Yong Kim who heads the World Bank with the original Dr attached to his name. So Dr Romer (who is a doctorate in economics) has no choice but to defend his Doctor in Medicine boss! Boss is always right no matter who he/she is the cardinal rule in any organisation.

Jokes aside, Romer says an outsider appointment is more efficient at cutting the flab:

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Doing economic history in Africa: experiences from the archives in Uganda

August 24, 2016

Nice post by Michiel de Haas, Felix Meier zu Selhausen and Kate Frederick. Two of them are economic historians in Africa.

They point to their experiences in building archives and connecting dots in Uganda:

The field of African Economic History is flourishing. The rising number of participants at the annual meeting of the AEHN, the increasing flow of articles in mainstream economic history journals and thriving research groups in Lund, Wageningen and Stellenbosch, just to name some of the larger research clusters, testify to this. The ‘new economic history of Africa’ is strongly data driven, with researchers using published and unpublished sources to create datasets, establish and compare trends, and conduct statistical analysis to tease out causality (for discussion and an overview, see the recent paper by Johan Fourie (2016)

To further expand our empirical knowledge of long-term African development, the potential of colonial archives in Europe is hardly exhausted, with researchers using trade, tax, wage, price, climatological, and criminal statistics to make a wide range of new and compelling contributions. However, there is much scope to venture beyond Europe’s missionary and government archives, which tend to focus on key administrative matters and provide only limited information on the seemingly mundane and practical intricacies of colonial rule. Previously neglected, individual-level data sources have already shown to harbour great potential to advance our knowledge of long-term African development. Recent contributions have utilized sources preserved in archives on African soil, including military recruit records, the performance files of police officers, hospital registries, and the marriage records of Anglican Africans.  

Archival documents in Uganda are in a state of flux after having been largely neglected or even destroyed during Uganda’s troubled post-colonial history. In recent years, things have been changing for the better. Social, cultural and political historians such as Derek Peterson (Michigan), Holly Hanson (Mount Holyoke) and Shane Doyle (Leeds) – just to name a few internationally renowned scholars – have been producing work that is firmly based on local source materials found in Uganda’s national, district and missionary archives.

Michiel de Haas and Felix Meier zu Selhausen share some of their experiences exploring a variety of source materials in Uganda. Michiel has been affiliated with the Makerere Institute of Social Research (MISR) in Kampala and visited the National Archives in Entebbe and five district archives. He has also conducted oral history interviews with cotton farmers in Eastern Uganda. Felix lived in Fort Portal for three years where he taught at Mountains of the Moon University. He has digitized marriage records from Anglican churches all over Uganda and in-patient registers from Western Uganda’s Kabarole Hospital.

Wow. This must be one of its kind experience. Church or any centre of religion archive is such a crucial place to understand initial development.

Using prospect theory to figure today’s monetary policy and its impact on markets..

August 12, 2016

Prof Jayant Varma of IIM Ahmedabad has a nice post which gets to the crux of the negative interest rate issue.

He says as bonds have negative rates, the concept of yield/coupon etc is lost. So, investors are looking at bonds in terms of prices alone just like stocks. Whereas, investors are looking at stocks as bonds as they give dividends. So bonds are the new equities and equities are the new bonds.

This is like the prospect theory applying in monetary policy as risk averse bond investors are seeking risks in wake of losses:

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How will digital currency shape the future of banking and monetary policy?

July 27, 2016

Marilyne Tolle of BoE discusses the several issues with respect to digital currency in Bank of England’s blog.

There is little doubt that these currencies as they gain ground could pull the carpet under the central banks monopolist chair. Central bankers who are habitual to tell the politicians and businesses about allowing disruptive innovations are going to get a bit on their game as well. More than anything else, it will be interesting whether central banks try and preserve their monopolies or let it go.

Tolle says digitial currencies will create problems for both banks and central banks. One key reason is the payment bit is going to get divorced from the deposits:

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