J. Bradford DeLong's Blog, page 46
May 28, 2020
Question to Self: Are These Sam Bowles's Five Greatest Works?
1985: The Production Process in a Competitive Economy https://github.com/braddelong/public-files/blob/master/readings/article-bowles-production-process.pdf...
2002: The Inheritance of Inequality (with H. Gintis) https://github.com/braddelong/public-files/blob/master/readings/article-bowles-gintis-inheritance-inequality.pdf...
2005: Moral Sentiments & Material Interests: Origins, Evidence, and Consequences (with H. Gintis, R. Boyd, & E. Fehr) https://github.com/braddelong/public-files/blob/master/readings/article-bowles-moral-sentiments.pdf...
2017: Friedrich von Hayek & the Market Algorithm (with A. Kirman and R. Sethi) https://github.com/braddelong/public-files/blob/master/readings/article-bowles-hayek.pdf...
#cognition #economics #notetoself #moralphilosophy #2020-05-28
May 27, 2020
I Find Alberto Alesina's Death Very Sad...
Ben was much closer to my friend Alberto Alesina than I was, so I pass him the mic: Benjamin Schoefer: 'Incredibly sad news https://twitter.com/Schoefer_B/status/1264382682089156609. Alberto Alesina was one of the three economists that led me to study economics, and a wonderful human being. One of my fondest memories includes a day in Jerusalem with Alberto and @joana_naritomi. I wish I could have met him one last time. Rest in peace.... "From @Cutler_econ Dear economist friends. I am very sad to report that Alberto Alesina passed away today. Apparently, he was hiking with his beloved wife Susan and had a heart attack. He was a great treasure whom we shall all miss��� #asknotforwhomthebelltolls #economists #noted #2020-05-27
Princeton's Semi-Confidence
Princeton is confident that it can be a research and a graduate university in the time of coronavirus���be face-to-face enough so as not to require a fundamental transformation. But as for undergraduates?:
Christopher Eisgruber: To the Princeton Community: The State of the University, and Planning for the Academic Year Ahead https://www.princeton.edu/news/2020/0... ���We will be dealing with COVID���19 for months or longer.�� This University, like all of America and the world, must proceed accordingly.... Our ability to restart our in-person teaching and research will depend upon whether we can do so in a way that respects public health and safety protocols.... [About] laboratories, libraries, and other facilities... we are optimistic.... We are also optimistic about resuming on���campus graduate advising and instruction this summer and in the fall.... Undergraduate education presents more vexing questions...
...The interpersonal engagement that animates undergraduate life makes social distancing difficult.��That is partly because undergraduates live in close proximity to one another, but even more fundamentally because they mix constantly and by design in their academic, extracurricular, and social lives. Many people have pointed out that COVID-19 infections are rarely fatal or even severe in people as young as our undergraduates.... Young people can, however, spread the virus to others.... To bring back our undergraduates, we need to be confident of our ability to mitigate the health risks not only to them, but also to the faculty and staff who instruct and support them, and to the surrounding community. We do not yet know enough about the path of this pandemic, and the medical response to it, to determine whether that is possible.... We are accordingly asking faculty members to begin planning now under the assumption that their classes will be online in the fall. In the event that we are able to resume residential instruction, we will be able to pivot quickly back to the instructional techniques more familiar to all of us���though we should anticipate that even if we can return to on-campus instruction in the fall, University life will be subject to significant restrictions for as long as the pandemic continues���
#coronavirus #education #noted #publichealth #university #2020-05-27
I do not see anyone inside the Trump administration under...
I do not see anyone inside the Trump administration understanding how the international monetary system works. And I see no sign that Steve Mnuchin���whose brief this is���is willing to spend any time trying to learn. But if he were, he would be listening to Barry Eichengreen. Right now COVID-19 is administering a disastrous health shock to the world. Following that is the less deadly but still important negative supply shock to our economies. Behind that is a manageable but as yet unmanaged knock-on domestic demand shock. And behind that is the rapidly-apporaching international financial crisis with its global negative demand shock that, as of yet, nobody is seriously trying to manage:
Barry Eichengreen: Managing the Coming Global Debt Crisis https://www.project-syndicate.org/commentary/managiing-coming-global-debt-crisis-by-barry-eichengreen-2020-05: ���These countries��� private companies borrow in dollars.... When it comes to the stabilizing use of monetary and fiscal policies, emerging markets are hamstrung. Which is why we are back to Baker Plan 2.0...
...suspend[ing] interest payments... private creditors... roll[ing] over an additional $8 billion worth of commercial debt. That, at least, is something. But, to borrow the baseball apostle Yogi Berra���s line, it is also ���d��j�� vu all over again.��� The Baker Plan likewise proceeded on the premise that the shock was transient and that a temporary debt standstill would be enough....
By 1989, seven unproductive years after the onset of the crisis, the Baker Plan finally was superseded by the Brady Plan.... Debts were written down. Bank loans were converted into bonds���often a menu of securities from which investors selected their preferred terms and maturities. Advanced-economy governments facilitated the transaction by providing ���sweeteners���.... Today���s crisis is also being treated as temporary, with a moratorium on interest payments and a promise of commercial credits remaining valid only through the end of the year. The reality is different. Weak global growth and depressed primary commodity prices will persist. Supply chains will be reorganized and shortened, auguring further disruptions of trade. Receipts from tourism and remittances will not pick up anytime soon. And unless the debt overhang is addressed, capital flows will not resume��� #finance #internationalfinance #macro #noted #2020-05-27
Noted: Donna Lu: Universal Basic Income
Very good news on the praticality and usefullness of a UBI: results of a social experiment from Finland: Donna Lu: _Universal Basic Income Seems to Improve Employment & Wellbeing) https://www.newscientist.com/article/2242937-universal-basic-income-seems-to-improve-employment-and-wellbeing/: ���Finland���s universal basic income study has revealed that the programme doesn���t seem to disincentivise work: Finland ran a two-year universal basic income study in 2017 and 2018, during which the government gave 2000 unemployed people aged 25 to 58 monthly payments with no strings attached. The payments of ���560 per month were not means tested and were unconditional, meaning they were not reduced if an individual got a job or later had a pay rise. The study was nationwide and selected recipients were not able to opt out, as the test was written into legislation. Minna Ylik��nn�� at the Social Insurance Institution of Finland announced the findings in Helsinki today via livestream.... Between November 2017 and October 2018, people on basic income worked an average of 78 days, which was six days more than those on unemployment benefits. There was a greater increase in employment for people in families with children, as well as those whose first language was not Finnish or Swedish ��� but the researchers aren���t yet sure why. When surveyed, people who received universal basic income instead of regular unemployment benefits reported better financial wellbeing, mental health and cognitive functioning, as well as higher levels of confidence in the future... #equitablegrowth #noted #socialinsurance #ubi #2020-05-27
2.4 Million More UI Filings
And the Bureau of Labor Statistics reports that still more workers, 2.4 million of them, lost their jobs and applied for unemployment benefits in the past week. Relaxing lockdowns looks to have increased the virus caseload. Relaxing lockdowns has not all has not yet boosted production:
Equitable Growth: ���2.4 Million Workers Applied for Unemployment Benefits in the Week of May 10���16 https://twitter.com/equitablegrowth/status/1263447742627667968: 'According to the US DOL���s Weekly Unemployment Insurance claims report released today. Since the onset of the #coronavirus crisis in mid-March, 38.6 million workers have filed initial UI claims. The number of continued claims reached 25 million the week ending May 9. The insured unemployment rate, which represents the share of workers receiving benefits as a percentage of the labor force, reached 17.2 %���a 1.5 percentage point increase from the previous week. While the additional $600 in unemployment benefits stipulated under the #CARESAct are set to expire on July 31, the #HeroesAct, which passed the House of Representatives last Friday, would extend the extra benefits through January 2021. Want to learn more about why extending additional Unemployment Insurance benefits would be good for workers and the entire economy? Check out this piece by Kate Bahn https://www.barrons.com/articles/the-good-economics-behind-generous-unemployment-benefits-51585594272��� #equitablegrowth #macro #noted #unemployment #2020-05-27
Trump: The Cruelty Is the Point...
IMHO, It is long past time for advertising-supported social media to die. The incentives facing Jack Dorsey, Mark Zuckerberg, and company are extremely poisonous. And���unlike Steve Jobs, Bill Gates, Jeff Bezos, even Elon Musk���Jack and Mark regard themselves as in the business of piling up as much money as they can, rather than as enabling and guiding human progress. It needs to stop. They are, as somebody-or-other said, our modern tobacco companies���only profiting from human addiction to controversy and polarization and susceptibility to misinformation rather than human addiction to nicotine: Brian Klaas: 'Trump took the tragic death of a young woman, Lori Klausutis https://twitter.com/brianklaas/status/1265239671140909058, and has tried to exploit it for political gain in the most disgusting way imaginable. This letter from her husband to [Twitter CEO Jack Dorsey] asking him to delete Trump���s sick tweets is a heart-wrenching must read.���
#fascism #journamalism #moralresponsibility #noted #orangehairedbaboons #publicsphere #2020-05-27
Recommended; Andy Slavitt
There are some nuggets of valuable information to be found in the huge sea of misinformation, chaos, and anger that is Twitter. I strongly recommend that you follow Andy Slavitt if you are on what I have heard called "the bad website": Andy Slavitt: COVID Update May 21 https://twitter.com/ASlavitt/status/1263628261470461955: ���Something is happening... that we should pay attention to... [but] we are ignoring it and the many warnings it represents.... "Waves"... emerge in the interaction of people & virus. It's not the virus attacking & retreating. It's not like waves that come in from the sea carrying momentum & energy. It's us. We���re not having the summer lull in the US. We���re not exploding but the death rate isn���t materially dropping. If we keep hovering around R=1, small factors may push us to one side or another of the divide. So it is possible there will be a perceived summer lull. But we could be crushing this virus instead if we doubled down on SD. Hardly anyone's even saying that. Fauci & others have repeatedly warned that while summer conditions may be less favorable to the virus, given how contagious it is & given our lack of population immunity, there is no reason to be confident it can't grow through the Summer. It has NOT declined significantly in US. 100,000+ DEAD AMERICANS BY THIS MONDAY, 150,000+ BY THE ELECTION due to Trump���s delays and lack of leadership...
#coronavirus #noted #orangehairedbaboons #publichealth
Remembering Facerbook's Video Semi?-Fraud
Jason #StayHome Kint: The industry and publishers chased Facebook���s news, learning only later they may have been fraudently deceived... https://twitter.com/jason_kint/status/1263762461271998466. Since Facebook was gifted global news headlines yesterday by prognosticating on work from home 5-10yrs from now, a reminder Facebook is supposed to be ���mostly video��� this year.... It was one of the long list of reasons not to trust Facebook. Did Facebook���s faulty data push news publishers to make terrible decisions on video?
Publishers' "pivot to video" was driven largely by a belief that if Facebook was seeing users, in massive numbers, shift to video from text, the trend must be real...
Laura Hazard Owen (2018): Did Facebook���s Faulty Data Push News Publishers to Make Terrible Decisions on Video? https://www.niemanlab.org/2018/10/did-facebooks-faulty-data-push-news-publishers-to-make-terrible-decisions-on-video/: ���Publishers��� ���pivot to video��� was driven largely by a belief that if Facebook was seeing users, in massive numbers, shift to video from text, the trend must be real.... ���The best way to tell stories, in this world where so much information is coming at us, actually is video,��� Mendelsohn continued. ���It commands so much more information in a much quicker period. So actually, the trend helps us to digest more of the information, in a quicker way.��� ���Five years to all video��� wasn���t just Mendelsohn���s line���it came from Facebook CEO Mark Zuckerberg himself.... The Wall Street Journal reported in September 2016, three months after the Fortune panel, that Facebook had ���vastly overestimated average viewing time for video ads on its platform for two years��� by as much as ���60 to 80 percent.��� The company apologized in a blog post: ���As soon as we discovered the discrepancy, we fixed it.��� A lawsuit filed by a group of small advertisers in California, however, argues that Facebook had known about the discrepancy for at least a year���and behaved fraudulently by failing to disclose it.... The court case was unsealed this week.... We may not be able to pinpoint exactly what Facebook knew when.... Facebook employees are quoted, but the quotes aren���t attributed. Without viewing the source emails or reports, we don���t know the context of what was said, and we don���t know who, for instance, said the company decided to ���obfuscate the fact that we screwed up the math������ as it a junior coder or (probably not) Mark Zuckerberg? We don���t know from the filing how far up the food chain the discussion of errors went...
#journamalism #noted #publicsphere #2020-05-27
The extremely thoughtful David Glasner explains why those...
The extremely thoughtful David Glasner explains why those who analogize the coronavirus supply shock to the monopoly oil price shocks of the 1970s are profoundly mistaken. This is not an inflationary supply shock. This looks overwhelmingly likely be a profoundly deflationary supply shock:
David Glasner: ���The Idleness of Each Is the Result of the Idleness of All��� https://uneasymoney.com/2020/03/20/th... ���Whether the cause of the downturn is a supply shock or a demand shock...
...Some, perhaps many, seem to think that if the shock is a supply, rather than a demand, shock, then there is no role for a countercyclical policy response designed to increase demand.... The problem with that reasoning is that reductions in supply are themselves effectively reductions in demand. The follow-on reductions in demand constitute a secondary contractionary shock on top of the primary supply shock, thereby setting in motion a cumulative process of further reductions in supply and demand....
The interconnectedness of the entire economy, and the inability of any individual to avoid the consequences of a social or economic breakdown by making different (better) choices���e.g., accepting a cut in wages to retain employment���was recognized by the most orthodox of all Cambridge University economists, Frederick Lavington, in his short book The Trade Cycle published in 1922 in the wake of the horrendous 1921-22 depression....
To call unemployment ���voluntary��� under such circumstances is like calling the reduced speed of drivers in a traffic jam ���voluntary.��� To suppose that the intersection of a supply-demand diagram provides a relevant analysis of the problem of unemployment under circumstances in which there are massive layoffs of workers from their jobs is absurd. Nevertheless, modern macroeconomics for the most part proceeds as if the possibility of an inefficient Nash equilibrium is irrelevant to the problems with which it is concerned....
In the face of an adverse supply shock, a spell of inflation lasting as long as the downturn is therefore to be welcomed as benign and salutary, not resisted as evil and destructive. The time for a decline in, or reversal of, inflation ought to be postpone till the recovery is under way...
#macro #noted #2020-05-27
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