Archive for the ‘Economics – macro, micro etc’ Category

As US President looks to build a wall on US-Mexican borders, here is history of walls…

February 3, 2017

Nice piece by Olivia B. Waxman of Time.

In the days after President Donald Trump signed an executive order authorizing “immediate” construction of a wall along the U.S.-Mexico border, followed by another executive order temporarily prohibiting refugees and citizens of seven predominantly Muslim countries from entering the U.S. (and blocking Syrian refugees indefinitely), four words were heard in many places across the United States this weekend: “No Ban! No Wall!”

As thousands of protesters camped out at JFK International Airport in NYC and other international airports nationwide to protest Trump’s actions, the sentiment became a popular one for signs and chants.

But Trump’s wall is not just controversial. A look at which groups have put up walls throughout history—and why—can help us understand just how unique the proposed wall would be.

“The distinctive thing is this is a wall against immigration—and to some degree also contraband drugs and gun-running—whereas historically, the other famous or infamous walls have almost always been about blocking invading armies,” says Wendy Brown, author of Walled States, Waning Sovereignty and professor of political science at the University of California, Berkeley.

Superb bit. Discusses many walls and how they came about.


Will “Big Data” make a centrally planned economy possible?

February 3, 2017

Indian media and experts are celebrating that finally Indian government is using big data for analysis and catch tax evaders. Even before budget, the government had set up panel of experts to look at deposit data on demonetisation.

In our excitement, we fail to realise this is exactly the trap governments want us to fall into. The idea of controlling and planning people’s activities is some thing which always excites governments and big data once again raises hopes for governments. We only realise our follies of falling in the trap when we are trapped into it.

Xiong Yue writes at Mises Institute blog about the big data potential for the governments. He is less hopeful though. Big data surely give governments more information about people but still prices etc are shaped by preferences of people:


RDX. RDX2, RDXF, SAM, QPM, ToTEM, LENS….are names of economic models used by Bank of Canada!

February 3, 2017

While reading this speech by Stephen Poloz chief of Bank of Canada, for a moment one thinks he/she is reading some scifi stuff. But such has been the state of economic modelling.

Infact the speaker starts with comparing economic forecasting to astronomy:


How the 19th-century rebuilding of Britain’s Parliament House made air pollution visible and controllable..

February 2, 2017

There is just so much to figure.

Timothy Hyde  Professor of Architecture at MIT has a piece on the topic. He shows how reconstruction of British Parliament house raised awareness about the presence of air pollution in London. This rising awareness eventually made authorities take action to curb the same:


Are India’s fund managers less savvy about political economy?

February 2, 2017

Debashis Basu of Moneylife is one of the few go to people on matters of economic and financial journalism . His earlier piece on payment banks when they were licenced was ahead of times as he was one of the few who dissented against their business model. We only saw later how as right of the licencees dropped from the race and just have started operations from remaining eight.

In this new hard hitting piece , he questions ignorance of India’s fund managers.

He says and rightly so that despite so called 25 years of liberalisation the fund managers continue to believe in big government, big and bold budgets/policy and so on. Whereas it should just be the opposite.

He keeps the discussion limited to fund managers but applies to so many others – economists, media, bankers, top businesses etc. They all talk and write in the same tone. It is unbelievable how even the private bankers respond so similarly to any policy.  Just look at the papers today. Same old story.


Ever wondered why the government is so powerful? It is due to their monopoly over currency..

February 2, 2017

Prabhat Singh explains how governments derive so much power due to their control over currency . He explains this uniquely via a question and answer session between two friends.

Superb bit. Couldn’t be a better way. It is a pity that even most economists do not get these basic ideas..


The other slient ban announced equally silently (European war on cash)….

February 1, 2017

As people write extensively on the US immigration ban, on the other side of Atlantic Europe also got in a ban act much silently. This European ban is on the new source of terror identified by the governments  – cash. The government’s War on cash is happening relentlessly.

Now Europe just announced a roadmap to limit cash usage across the continent.

Simon Black explains (HT: Good friend Prabhat):


If Italy exits, how will it ease the Lira shortages?

January 31, 2017

JP Koning has a post on the issues with Italexit. He says whichever way look at, entering Euro is a one way street. Italy is a weak economy and its currency Lira will depict the weakness. The Italians shall always prefer to hold Euro leading to both currencies in circulation.


Understanding the war on cash (Why, who and problems)?

January 30, 2017

A three essay series by Tony Joseph of Business World. He looks at the various political economy factors behind the digital cash drive. This go digital drive is hardly as rosy as it is presented to the masses. There are several players involved who are using governments to rush/push through policies to make that quick killing.

In the first essay he says:


Are you angry? Then learn economics!

January 27, 2017

Most of the time we read articles on how economists have led to a world full of greed and inequality. Most of the current problems are being blamed on the profession.

However, there are some who think otherwise.  Rick Weber one of the bloggers on NoteonLiberty Blog says we should actually learn economics:


Budget lessons from the Nawab of Awadh..

January 27, 2017

Aurodeep Nandi draws budget lessons from Nawab of Awadh.

The Nawab built Imambara amidst struggling economy. Thus, India should also opt for more Capital expenditure ahead of revenue expenditure:


The Long Economic and Political Shadow of History

January 25, 2017

Voxeu team is coming up with a series of three e-books (free) all of which make one’s eyes to lighten up.

The first one is there on the website:

 Volume 1 of the e-book starts with our more detailed discussion of the recent literature on economic history that aims to explain the considerable persistence in economic and political development. It also includes some additional introductory chapters that review works on the spatial distribution of development, as depicted in satellite images on light density at night, summaries of fascinating new papers on the macrogenoeconomics of comparative development, and studies on environmental economic history. Next, it includes chapters which explore watershed events that have global repercussions, such as colonisation, the role of the Enlightenment on the Industrial Revolution, and the spur of commerce during the first era of globalisation.
The chapters in Volume 2 (forthcoming) feature research on the deep origins of African development and works on the legacy of colonial practices in India, China, and Australia. They cover a diverse set of major historical issues, such as the impact of the slave trades, colonial divide-and-rule policies and investments in infrastructure and human capital, the legacy of British direct and indirect rule in India, the long-lasting effect of convict resettlement in Australia, and the role of colonial ports in China. 
Volume 3 (also forthcoming) focuses on Latin and North America and Europe. The chapters on the Americas cover a plethora of colonisation-related events, such as the legacy of the mita (forced labour system in Peru), the role of Christian missions, the resettlement of indigenous communities in reserves in North America, and many more. The chapters on Europe discuss, among other topics, the role of the Protestant Reformation on industrialisation and the legacy of the Holocaust, Nazi occupation, and communism on social structure, politics, and norms. They also cover research tracing beliefs, trust and norms related to trust and social capital to the medieval times.


Hedge-fund managers are buying air strips in New Zealand in case…

January 24, 2017

An interview of Rob Johndon, President of INET.

He says one indicator to look for is the elite anxiety which is rising . As a result, the top elites in US are buying private spaces in New Zealand and private planes to fly there:


A more effective way to learn about history of economic thought…

January 23, 2017

I came across this website: which is going to be used a lot by this blog in future.

It has this wonderful resource page on history of economic thought with this superb picture summing the core of most schools:


This is amazing!

As they say: A picture is worth thousand words and here it is worth much more than just thousand words.

These schools of thought are compared across different questions and issues. THese together should help develop comparative perspectives on these schools.

There are videos and lectures on the site as well. Do take a look..


Was US behind India’s demonetsation? Lessons from crisis when US bailed out the RBI in 1940s..

January 23, 2017

Srinath Raghavan has an interesting piece.

He says there are conspiracy theories on whether US was behind demonetisation? He picks lessons from 1940 silver crisis when US bailed out India. He says main thing is credibility of Govt and RBI which was an issue then and will be an issue today:


Legislating Instability: Adam Smith, Free Banking, and the Financial Crisis of 1772

January 20, 2017

This is the title of a book by Prof Tyler Goodspeed. A brief of the book is here.

The failure of Ayr Bank in 1772 was a turning point in financial history. It led to change in thinking of Adma Smith who till then favored banking free of government regulation. Thus, this event continues to inspire financial historians who look for different viewpoints to explain the crisis.

Prof Hugh Rockoff reviews the book and sums up:


A dynamic world map showing emigration to the United States from different countries since 1820

January 18, 2017

Superb pointer from Utopia Blog:

What are US economists going to do in Trump era?

January 18, 2017

The world of US economists post Trump can be summed in two words – reality check.

Justin Fox has a nice piece summarising the key thoughts and sessions at the annual American Economic Association meeting:


Study economics not to be deceived by clever economists..

January 16, 2017

An interesting comment by Dr Manmohan Singh. More so they coming  at launch of a book on history of economic ideas by Vinay Bharat Ram:

Economics should be studied not to find settled answers to unsettled questions but to warn on how not to be deceived by clever economists, former Prime Minister Manmohan Singh said quoting economist Joan Robinson. “When we study economics, what is the purpose of the study of the economics? It is not to find settled answers to unsettled questions but to warn us how not to be deceived by clever economists,” Singh said at launch of the book ‘Evolution of Economic Ideas – Smith to Sen and beyond’ by DCM Limited’s Chairman Vinay Bharat Ram.

“When we study economics, our impulse is not the philosopher’s impulse, knowledge for the sake of knowledge, but for the healing that knowledge may have to bring. It is for the heart to suggest our problems, it is for the intellect to solve them. The only purpose of intellect is to be a servant of social sympathies. That gives you one idea of what economics is all about,” Singh said.

This is superb bit of quoting by Dr Singh from history of economic thought.

As students of economics, these ideas/statements should be really well known to us. But it is a pity (or a shame?) that as none of this is taught, we get to read about them so randomly and then ponder/wonder over the words of wisdom….

The top rich in Europe in the long run of history (1300 to present day)

January 16, 2017

Prof. Guido Alfani of Bocconi university says: