J. Bradford DeLong's Blog, page 5

DeLongTODAY: How Did ��e ���Global South��� Become so Underdeveloped?

<http://delongtoday.com>
<https://drive.google.com/file/d/1v1pEjikOuMe31K62EHojlHXi37Hv64iu/view?usp=sharing>

<https://github.com/braddelong/public-files/blob/master/delongtoday-2021-03-11.pptx>
<https://www.icloud.com/keynote/0Td2okG4-n-z59HeH8UYMjdHA>
<https://www.bradford-delong.com/2021/03/how-did-the-global-south-become-so-underdeveloped.html>

 

BRIEFLY NOTED: 2021-03-18 Th

Things that went whizzing by that I want to remember...

 

First:

Figuring out how to do antitrust in the age of the attention economy is really, really hard:

Ben Thompson: The FTC���s Google Documents, the Staff Memo, the Economists Memo: ���The fundamental premise of the Politico article, along with much of the antitrust chatter in Washington, misses the point: Google is dominant because consumers like it. That doesn���t mean the company didn���t act anticompetitively, or that we shouldn���t think seriously about acquisitions or contracts or advertising. Such thinking, though, has to start with a certain degree of humility about the fundamentally different nature of the Internet and how it is leading to these Aggregator-type outcomes. It really might be different this time.���

LINK: <https://stratechery.com/2021/the-ftcs-google-documents-the-staff-memo-the-economists-memo/>

Very Briefly Noted:

Gretchen Kell: UC���s Deal with Elsevier: ���What it took, what it means, why it matters��� LINK: <https://news.berkeley.edu/2021/03/16/ucs-deal-with-elsevier-what-it-took-what-it-means-why-it-matters/>

Masahisa Fujita, Paul Krugman, & Anthony J. Venables (1999): The Spatial Economy: Cities, Regions, & International Trade<https://mitpress.mit.edu/books/spatial-economy>

American Economic Association: Best Practices for Economists: ���Building a More Diverse, Inclusive, and Productive Profession��� LINK: <https://www.aeaweb.org/resources/best-practices>

Robert Skidelsky: Sequencing the Post-COVID Recovery <https://www.project-syndicate.org/commentary/keynes-criticism-of-new-deal-relevant-to-covid19-by-robert-skidelsky-2021-03>

Patrick Wyman: The Afroasiatic Languages & the Green Sahara, 10,000 Years Ago: ���Eventually, of course, the Sahara got much drier. It���s hard for us to imagine it as anything other than an inhospitable desert, but 10,000 or so years ago, it would���ve been one of the best places on the planet to live. Anyway, this is just my theory��� LINK: <https://patrickwyman.substack.com/p/the-afroasiatic-languages-and-the>

Yegor Gaidar (2007): The Soviet Collapse: Grain & Oil: ���In 1985 the idea that the Soviet Union would begin bargaining for money in exchange for political concessions would have sounded absolutely preposterous to the Soviet leadership. In 1989 it became a reality, and Gorbachev understood the need for at least $100 billion from the West to prop up the oil-dependent Soviet economy��� LINK: <https://www.aei.org/wp-content/uploads/2011/10/20070419_Gaidar.pdf>

Laura Tyson & Susan Lund: The Post-Pandemic Labor Market���s Long-Term Scars: ���Even before the COVID���19 crisis, African-Americans, Hispanics, women, and workers without a post-secondary education faced dimming prospects as a result of automation and other trends. Now, these forces have been strengthened, creating an even bigger mismatch between worker qualifications and available jobs��� LINK: <https://www.project-syndicate.org/commentary/pandemic-permanent-job-losses-need-worker-retraining-by-laura-tyson-and-susan-lund-2021-03>

John Maynard Keynes (1919): The Economic Consequences of the Peace: ���[Their] view of the world��� filled with deep-seated melancholy the founders of our Political Economy. Before the eighteenth century mankind entertained no false hopes. To lay the illusions which grew popular at that age���s latter end, Malthus disclosed a Devil. For half a century all serious economical writings held that Devil in clear prospect. For the next half century he was chained up and out of sight. Now perhaps [with World War I] we have loosed him again��� LINK: <https://oll.libertyfund.org/title/keynes-the-economic-consequences-of-the-peace#preview>

Six Paragraphs:

Martin Sandbu: US Stimulus Package Leaves Europe Standing in the Dust: ���Europe and the US will loom less large in the global economy as emerging countries outperform their growth. That is inevitable. What we do not know is how fast that US and European dominance will be whittled away���. US president Joe Biden has delayed his country���s relative decline. EU leaders, however, look set to accelerate theirs. Biden���s $1.9tn fiscal stimulus package, passed last week, may not be literally visible from space, but it is certainly of planetary scale. In the OECD���s March update to its forecasts, the organisation estimated that the US stimulus will add one whole percentage point to projected global growth. It more than doubled its 2021 growth forecast for the US itself, from 3.3 to 6.5 per cent. Biden���s own administration foresees US output returning to its potential three to four years faster because of the stimulus���

LINK: <https://amp.ft.com/content/20096b0a-8a94-453d-8788-c3b15dc1704c>

Neil Irwin: Move Over, Nerds. It���s the Politicians��� Economy Now: ������This legislation has everything to do with restoring the confidence of the American people in democracy and in their government, and if we can���t respond to the pain of working families today, we don���t deserve to be here,��� said Senator Bernie Sanders of the Biden bill, known as the American Rescue Plan Act. Republicans unanimously opposed the Biden legislation, but it has not been quite the scorched-earth opposition to deficit-widening action seen during the Obama administration���. f the concerns described by Mr. Summers and Mr. Blanchard about the size of the new relief bill materialize, and the result is excessive inflation or some type of crisis, Democrats will pay a price for their actions��� 

LINK: <https://www.nytimes.com/2021/03/09/upshot/politicians-not-central-bankers-economy-policy.html>

Duncan Black: I���m Gonna Tell You How It���s Gonna Be: ���Yes he���ll fade away: ���Ex-president Donald Trump finds himself adrift while in political exile. And Republicans, and even some allies, say he is disorganized, torn between playing the role of antagonist and party leader. ���There is no apparatus, no structure and part of that is due to a lack of political understanding on Trump���s behalf���, said a person close to the former president, noting that Trump has struggled to learn the ropes of post-presidential politicking.��� He���s lazy, stupid, and a micromanager, and at least somewhat radioactive at the moment. Also it isn���t a secret that he stiffs everybody. Not a magnet for the best people��� LINK:

<https://www.eschatonblog.com/2021/03/im-gonna-tell-you-how-its-gonna-be.html?>

John Paul Koning: Hacksilver: ���The first coins were invented in Lydia��� in the 7th Century B.C.E���. Belief among some archaeologists that a form of proto-coinage had been invented prior to the Lydians and their electrum coins. This proto-coinage came in the form of sealed and regulated bags of hacksilver���. Morris Silver, an economist who researches ancient economies, describes Mesopotamian texts of the middle of the second half of the third millennium that show silver being used by street vendors, to pay rent, purchase dates, oil, barley, animals, slaves, and real estate���. Assyrian economic texts from the 7th C B.C. show that the majority of all types of payments were already being made in silver, including those for tribute, craftsmen obligations, and for conscription and labor commutations���. 6 minas (c. 3 kg) of silver are owed by two men to the merchant Ashur-idi. One third of the loan must be paid by the next harvest and the rest at a later date. If it is not repaid by that time it will accrue interest charged at a monthly rate���.

Hacksilver��� silver ingots, hacked pieces of ingot, silver scrap, and cut up bits of silver jewellery���. One reason for the hacking or cutting-up of silver may have been to make small change���. Another less obvious reason for hacking��� is that it may have been a way for merchants to check for quality���. For over a thousand years, silver circulated as a medium of exchange, in hacked form. The big innovation with coins is the stamp. Because we trust the issuer���s brand, we needn���t weigh out or assay (i.e. smash/hack) silver prior to engaging in trade. So trade was much more fluid���. Proto-coiners��� suggest that bagged and sealed hacksilver was already circulating in a way similar to coins. Some authority, perhaps a government administrator or a merchant, pre-weighed a certain amount of good hacksilver, bagged it, and affixed their seal���. If the proto-coiners are right, that��� pushes the effective date of coinage technology back by 500 or so years���.

One of the key hoards around which the debate revolves is the Tel Dor hoard��� north of Haifa��� excavated in the 1990s by Ephraim Stern���. The Tel Dor hoard dates to somewhere between 1000 B.C.E and 900 B.C.E. The hoard consists of a jug containing 17 bundles of hacksilver wrapped up by linen cloth (see photo of one of the bundles below)���. The silver weighs 8.5 kilograms��� the equivalent of forty-six years of labour���. The bundles were closed with bullae, or clay seals. But these seals do not contain a name, just a pattern���. One of these bundles��� registered at 490.5 grams���. The Babylonian shekel��� each shekel weighed 8.3g, and 60 shekels was worth 1 mina. Thus a mina would have weighed 500 grams��� as if the bundle was a very large denomination mina coin��� 

LINK: <http://jpkoning.blogspot.com/2021/03/hacksilver.html>

Michael R. Gordon & Dustin Volz: Russian Disinformation Campaign Aims to Undermine Confidence in Pfizer, Other Covid���19 Vaccines, U.S. Officials Say: ���Russian intelligence agencies have mounted a campaign to undermine confidence in Pfizer Inc.���s and other Western vaccines, using online publications that in recent months have questioned the vaccines��� development and safety, U.S. officials said���. Websites played up the vaccines��� risk of side effects, questioned their efficacy, and said the U.S. had rushed the Pfizer vaccine through the approval process, among other false or misleading claims���. ���We can say these outlets are directly linked to Russian intelligence services,��� the Global Engagement Center official said of the sites behind the disinformation campaign. ���They���re all foreign-owned, based outside of the United States. They vary a lot in their reach, their tone, their audience, but they���re all part of the Russian propaganda and disinformation ecosystem.��� In addition, Russian state media and Russian government Twitter accounts have made overt efforts to raise concerns about the cost and safety of the Pfizer vaccine in what experts outside the U.S. government say is an effort to promote the sale of Russia���s rival Sputnik V vaccine���

LINK: <https://www.wsj.com/articles/russian-disinformation-campaign-aims-to-undermine-confidence-in-pfizer-other-covid-19-vaccines-u-s-officials-say-11615129200>

Holman Christian Standard Bible: Leviticus 16: ���The LORD spoke to Moses���. ���Aaron will present the bull for his sin offering and make atonement for himself and his household. Next he will take the two goats and place them before the LORD at the entrance to the tent of meeting. After Aaron casts lotsm for the two goats, one lot for the LORD and the other for azazel, he is to present the goat chosen by lot for the LORD and sacrifice it as a sin offering.p 10But the goat chosen by lot for azazel is to be presented alive before the LORD to make purification with it by sending it into the wilderness for azazel���. When he has finished purifying the most holy place, the tent of meeting, and the altar, he is to present the live male goat. Aaron will lay both his hands on the head of the live goat and confess over it all the Israelites��� wrongdoings and rebellious acts���all their sins. He is to put them on the goat���s head and send it away into the wildernessa by the man appointed for the task.ah The goat will carry on it all their wrongdoings into a desolate land, and he will release it there���. The man who released the goat for azazel is to wash his clothes and bathe his body with water; afterward he may reenter the camp���

LINK: <https://biblehub.com/hcsb/leviticus/16.htm>

 

Sidney Coleman Is My Interpretation-of-Quantum-Mechanics Guru; Plus BRIEFLY NOTED: for 2021-12-17 We

The talk that made me a many-worlds Everettian; plus things that went whizzing by that I want to remember...

 

First:

I have long loved Sidney Coleman���s 1994 Quantum Mechanics in Your Facelecture. Now it has been published, for real, with well-drawn versions of the slides:

Sidney Coleman: Quantum Mechanics in Your Face: Transcript and slides edited by Martin Greiter: ���This is a write-up of Sidney Coleman���s classic lecture first given as a Dirac Lecture at Cambridge University and later recorded when repeated at the New England sectional meeting of the American Physical Society (April 9, 1994). My sources have been this recording and a copy of the slides Sidney send to me after he gave the lecture as a Physics Colloquium at Stanford University some time between 1995 and 1998. To preserve both the scientific content and most of the charm, I have kept the editing to a minimum, but did add a bibliography containing the references Sidney mentioned.���MG���

LINK: <https://arxiv.org/pdf/2011.12671.pdf>

And, of course, there still is the video: Sidney Coleman (1994): Quantum Mechanics in Your Face <https://www.youtube.com/watch?v=EtyNMlXN-sw>:

Plus there is the essential reading:

N. David Mermin: What���s Wrong with These Elements of Reality?<https://pdfs.semanticscholar.org/3d27/ad8d1cee3a12b35b4e424b9c36ec424ecc6e.pdf>

N. David Mermin: Is the Moon There When Nobody Looks?: Reality & the Quantum Theory <https://physics.csuchico.edu/kagan/435B/problems/Mermin.pdf>

N. David Mermin (1990): Quantum Mysteries Revisited <http://www.physics.smu.edu/scalise/P5382fa15/Mermin1990a.pdf>

Daniel M. Greenberger, Michael A. Horne, & Anton Zeilinger: Going Beyond Bell���s Theorem <https://arxiv.org/pdf/0712.0921.pdf>

Wojciech H. Zurek: Decoherence & the Transition from Quantum to Classical���Revisited <https://arxiv.org/pdf/quant-ph/0306072.pdf>

You know, i used to think that I would���someday���understand electron spin.

I used to think that I would���someday���understand why Stern-Gerlach magnets arranged along the x-axis would knock an electron that was in the i���s would start appearing in the math���

Now I know that it is hopeless.

And, similarly, it is hopeless to ask why the triple measurement ��(1x)��(2y)��(3z) applied to the three electrons 1, 2, and 3 that are in Coleman���s entangled (

It is the Pauli matrices that are the underlying reality���or, at least, are our only through-a-glass-darkly shadowy and illusory simulacrum of understanding. They are not the things that can be explained in terms of more fundamental principles. They are, rather, our feeble monkey-brain grasp of what the fundamental data are.

All of which is to say that Sydney Coleman���s Quantum Mechanics in Your Facelecture���the title of which, I am told in good authority, is incomprehensible to Britishers, save that they suspect and fear that it is in some way obscene���is the best thing on the interpretation of quantum mechanics I have seen.

And if it does not convince you to be a root-and-branch Everettian many-worlder���well, then I think that, back in The Day, there would have been nothing to convince you to be a non-Ptolemaic Copernican either. The Copernican points would have whizzed by: In the Copernican model there is no unmotivated sharp division between the behavior of the inferior and the superior planets as there is in the Ptolemaic model? You would have shrugged. The peculiar coincidence in the Ptolemaic model that all of the planets have at least one epicycle that is the same as the main cycle of the sun, which lacks an epicycle? You would have stared blank-eyed.

If Coleman doesn���t convince you now. Copernicus would not have convinced you then���

Very Briefly Noted:

Arun Venkatesan: The Iconic Watches That Inspired Apple Watch Faces <https://www.arun.is/blog/apple-watch-faces/>

Econ 135: 4.3.3., 4.4.3., & 4.5.3. Zoom Session: Globalization, Convergence, & Underdevelopment :: Slides <https://www.bradford-delong.com/2021/03/econ-135-433-443-453-zoom-session-globalization-convergence-underdevelopment-slides.html>

Six Paragraphs:

Steve M.: We���re Living in a Post-Trump World, & Republicans Are Still Awful: ���If you���ve been waiting for the moment when Republicans will start acting abashed, or begin examining their own behavior over the past several years, or acknowledge that their critics have a point about��� well, anything, you���re going to have a long wait, because that moment will never come. It might come if Democrats beat Republicans mercilessly in several consecutive election cycles���but Democrats trounced Republicans in 2006 and 2008 and the GOP only got worse. Trumpism hasn���t supplanted old-school Republicanism. Trumpism has simply been added to all the other toxic strains of Republicanism. And we���re getting them all again, full strength���

LINK: <https://nomoremister.blogspot.com/2021/03/were-living-in-post-trump-world-and.html>

David Atkins: Could Democrats Finally Be Taking on the Filibuster?: ���Most crucial at this inflection point in history, the Republican Party has set itself in fierce opposition to democracy itself. All across America, Republicans are pushing state-based legislation that would dramatically suppress voting rights and limit the ability of marginalized communities to have a voice in government. Republicans know they cannot persuade majorities with their current platform, so they plan instead to legally cheat their way into permanent minority power, reinstituting a new era of Jim Crow and apartheid at the ballot box. Given the current hyperconservative composition of the Supreme Court, The only way to stop it is by a federal act of Congress. But Congressional action will not take place as long as the filibuster remains standing in its current form. Everything, then, comes back to the filibuster���. Even Joe Manchin, the most famous holdout in favor of the filibuster in the Senate Democratic caucus, seems open to a talking filibuster reform���. My Washington Monthly colleague Bill Sher has been taking a contrary stand on this, hoping for compromise legislation between reasonable legislators in both parties and a de-escalation of partisan tensions. But it���s deeply unlikely that the authoritarian white supremacist fever on the right will be broken without destroying the possibility of their taking power through minority rule. Mitt Romney is not going to win the battle for the soul of the GOP���at least, not until the GOP is forced to acknowledge that their only path to legitimate power lies in persuading actual majorities of voters���

LINK: <https://washingtonmonthly.com/2021/03/13/could-democrats-finally-be-taking-on-the-filibuster/>

David Atkins: How Facebook Is Killing Journalism and Democracy | Washington Monthly: ���It���s high time the federal government do something about It: At the heart of much of this bedlam are the deliberate actions of social media companies in general, which have broadly destroyed the revenue model for journalism���often through deliberate lies���and created engagement algorithms that incentivize hateful polarization and outright disinformation. And no social media has been more guilty of both than Facebook. Two big stories dropped this week highlighting Facebook���s ongoing role in sabotaging both journalism and democracy in the pursuit of profit. The first is a devastating story by Karen Hao at the MIT Technology Review on how Facebook���s artificial intelligence unit learned how to efficiently drive engagement on the platform by recommending increasingly inciteful and extremist content and groups. Then, when the teams involved in creating this monster began to realize what they had unleashed and took steps to curtail it, the company (largely at the direction of Mark Zuckerberg himself) refused to do anything significant about it���choosing instead to deflect the problem toward issues of bias rather than polarization and disinformation���. Worse, Facebook���s efforts at controlling bias were manipulated by Trump and the conservative media���s endless factory treadmill of self-pitying victimhood into specially privileging the very conservative disinformation that was the biggest offender for asymmetric polarization���. Facebook is not, of course, the only social media organization that has contributed to this. Youtube (now a subsidiary of Google���s parent company Alphabet) in particular is famous for leading users down a primrose path to radicalization, guiding the unsuspecting down a pipeline from videos on anything from Star Wars to fitness to economics, straight to Jordan Peterson, Prager University or Ben Shapiro in just minutes. But Facebook���s algorithms have been particularly aggressive, and its consequences especially devastating���. As if that were not bad enough, Facebook has also been responsible for lying to journalists about what would provide more of the paltry revenue they were still allowed to keep. Most striking was the ���pivot to video��� era, in which Facebook allegedly dramatically overstated the potential for revenue from video content���

LINK: <https://washingtonmonthly.com/2021/03/13/facebook-is-killing-journalism-and-democracy-we-should-do-something-about-it/>

David Atkins: Facebook���s Vaccine Disinformation Study Shows the Problem with Facebook: ���Facebook can���t do anything about the fact that there are large pockets of angry, low-trust conspiracy theorists online. But Facebook could do something about the fact that those pockets have disproportionate impact on a larger universe, because Facebook tailors its engagement algorithms to promote the most controversial voices. It is no surprise at all that a small number of obnoxious people on Facebook are impacting the opinions of much larger groups on Facebook���

LINK: <https://washingtonmonthly.com/2021/03/14/facebooks-vaccine-misinformation-study-shows-the-problem-with-facebook/>

Financial Times Editorial Board: The Unhappy Consequences of Lula���s Return: ���Latin America���s most famous politician has made a triumphant return to centre stage after a supreme court judge unexpectedly quashed his convictions for corruption. No matter that the ruling favouring former Brazilian president Luiz In��cio Lula da Silva was based on a mere technicality; his supporters hailed the decision as a vindication of their long-held belief that Lula was the victim of a politically motivated vendetta. The consequences of the ruling, assuming that it is upheld by the full court, are immense. At a stroke, it redraws the electoral map for next year���s presidential election by allowing Lula to run again. Hard-right President Jair Bolsonaro had been in a strong position to win re-election against a divided opposition; now he is likely to face a strong challenge from the left. Bolsonaro has a woeful record in power, which has included repeatedly praising dictatorship, allowing Amazon deforestation to surge to 12-year highs and dangerously mismanaging the pandemic, while disappointing investor hopes for big economic reforms. That might invite the conclusion that a ruling allowing Lula���s return can only be good for Brazil. Yet the judge���s decision has unhappy consequences. It strikes a heavy blow against the credibility of Latin America���s biggest and most successful corruption investigation. It raises disturbing questions about Brazil���s justice system. And it increases the chances that the country���s notoriously venal politicians can get back to business as usual���. In their zeal to bring the powerful to book, prosecutors made serious mistakes. Leaked messages between a judge trying the cases, Sergio Moro, and prosecutors discussing what evidence to use against Lula suggested corners were being cut to secure convictions. Moro���s subsequent decision to accept a cabinet post in Bolsonaro���s government only fuelled accusations of political bias���. Brazil now faces the ominous prospect of impunity for the corrupt: the ���Lava Jato��� investigation was quietly wound up last month after seven years. Almost as unappealing is the promise of a polarised election next year between candidates of the hard right and the old-fashioned left��� LINK: <https://www.ft.com/content/90556eda-a658-4849-be51-fff7c0a99a23>

Noah Smith: Checking in on the Global South: ���To some, the idea of a Global South means that history is destiny���that the dead hand of colonialism, or the living hand of neocolonialism, is holding down the developing world. To others, it���s an expression of the idea that poor countries just don���t have what it takes to get rich. Either way, it���s a form of implicit defeatism���a belief that historical and/or cultural forces are stronger than economic forces. Southeast Asia hasn���t yet broken these ideas on the wheel of hard data, but it might not take much longer to do so. Bangladesh���s similar performance, meanwhile, suggests that South Asia might not be far behind���

LINK: <https://noahpinion.substack.com/p/checking-in-on-the-global-south>

Kieran Healy: America���s Ur-Choropleths: ���Maps of the U.S. for whatever variable in effect show population density more than anything else���. The other big variable��� is Percent Black. Between the two of them, population density and percent black will do a lot to obliterate many a suggestively-patterned map of the United States��� LINK: <https://kieranhealy.org/blog/archives/2015/06/12/americas-ur-choropleths/>

[image error]

[image error]

 

PODCAST: Hexapodia VI: The Global South Begins to Converge to the Global North!; Wi�� Noah Smith & Brad DeLong

 

Listen in podcast app



[image error]

For 200 years���from 1800 to 2000���first the Industrial Revolution Age and next the Modern Economic Growth Age rolled forward, bringing previously unimaginable wealth to the global north. And the global south fell further and further behind. Don���t get us wrong���life expectancy, nutrition standards, and material well-being in 2000 were all much higher in the global south in 2000 than in 1800. But the proportional gap vis-a-vis the global north had grown to staggering and awful proportions that were a scandal, a disgrace, and a crime. But since 2000 the worm may have turned: now it looks as though the global south���virtually the entire global south���is now ���converging��� and catching up to the global north.

 

References:

William Baumol (1986): Productivity, Convergence, & Welfare: What the Long-Run Data Show <http://piketty.pse.ens.fr/files/Baumol1986.pdf>

J. Bradford DeLong (1988): Productivity, Convergence, & Welfare: Comment <https://www.jstor.org/stable/1807174>

Paul Krugman (1991): _ Increasing Returns and Economic Geography_ <https://pr.princeton.edu/pictures/g-k/krugman/krugman-increasing_returns_1991.pdf>

Lant Pritchett (1997): Divergence, Big Time <https://www.econ.nyu.edu/user/debraj/Courses/Readings/Pritchett.pdf?seq=14>

Masahisa Fujita, Paul Krugman, & Anthony J. Venables (1999): The Spatial Economy: Cities, Regions, & International Trade<https://mitpress.mit.edu/books/spatial-economy>

Alberto Alesina, William Easterly, & Janina Matuszeski (2009): Artificial States <https://wcfia.harvard.edu/files/wcfia/files/alesina_artificialstates.pdf>

Joe Studwell (2013): How Asia Works: Success and Failure In the World's Most Dynamic Region <https://books.google.com/books?id=dNs33Q1cAX0C>

Noah Smith (2021): _All Futurism is Afrofuturism <https://noahpinion.substack.com/p/all-futurism-is-afrofuturism>

Dev Patel, Justin Sandefur, & Arvind Subramanian (2021): The New Era of Unconditional Convergence <https://www.cgdev.org/sites/default/files/new-era-unconditional-convergence.pdf>

Michael Kremer, Jack Willis, & Yang You (2021): Converging to Convergence <https://scholar.harvard.edu/yangyou/publications/converging-convergence>

Noah Smith: Checking in on the Global South: ���Developing countries are catching up, but not evenly��� LINK: <https://noahpinion.substack.com/p/checking-in-on-the-global-south>

[image error]

BRIEFLY NOTED: for 2021-02-16 Tu

Things that went whizzing by that I want to remember...

 

First:

I have a difficult time figuring out what to do with the NeverTrumpers. They are, most of the time, talking sense���now. But they were all enthusiastic boosters of all of the Littler Trumps who led up to this moment, from Sarah Palin to George W. Bush in a flightsuit proclaiming ���Mission Accomplished��� to the ���why doesn���t anybody ever talk about Black-on-Black crime?���.

If one is going to have a conversion on the road to Damascus and then have the, as it were, scales fall from your eyes on the street called ���Straight���, you kinda have an obligation to Testify to that Damascus Moment, don���t you?

Thus the problem is that for ���where people are��� read ���where David French and all of his friends have led them": Donald Trump, after all, is not that different from Newt Gingrich in their common platform that the purpose of politics and governance is simply to own the liberals by every means possible:

David French: The Spiritual Problem at the Heart of Christian Vaccine Refusal: ���In conversations about the vaccine, I���ve heard a number of people declare, ���I���m just less trusting than you.��� In reality, these people still trust��� a favorite internet voice, a local pastor, or a Bible study full of close friends who have shared counter-cultural health tips and advice for years. There���s a hostile and condescending way of approaching the different ways we trust. Yes, you can caricature objections and claim that Christians ���believe the latest hoax video on PatriotLibertyEagle.net more than the Centers for Disease Control.��� But we must instead meet people where they are���. Just as you don���t mock someone out of fundamentalism or sneer them out of conspiracies, you can���t berate them into trusting institutions they may perceive to be distant, elitist, and hostile���. [It] requires us to listen, to hear exactly why someone is concerned and to respond���again, without condescension���to their fears. In that atmosphere of trust and respect, you���ll often find that you can easily allay their concerns��� 

LINK: <https://frenchpress.thedispatch.com/p/the-spiritual-problem-at-the-heart>

Very Briefly Noted:

Markus K. Brunnermeier & Ricardo Reis: A Crash Course on the Euro Crisis <https://scholar.princeton.edu/markus/publications/crash-course-euro-crisis>

John Guther: Roosevelt in Retrospect: A Profile in History <https://archive.org/details/rooseveltinretro00gunt/page/24/mode/2up>

One Video:

Jade: Lagrangian Mechanics���A Beautiful Way to Look at the World<https://www.youtube.com/watch?v=dPxhTiiq-1A>:

Four Paragraphs:

Mohamed A. El-Erian: The US Recovery���s Promising Moment: ���Recent macroeconomic figures and the accelerating pace of COVID���19 vaccination suggest��� optimism about the US economy���. [A] notable economic pickup is being driven by the release of pent-up demand��� and��� fiscal stimulus��� both likely to intensify as vaccines continue to be administered more quickly���. But three main challenges���. First, progress toward increased vaccine availability is necessary but insufficient���. Second��� the pickup in economic activity has yet to be accompanied by a sustained, strong rebound in employment���. Third��� the fear is that the additional stimulus will trigger a spike in inflation and market interest rates, which could derail a sustained recovery and heighten the risk of financial-market accidents���

LINK: <https://www.project-syndicate.org/commentary/us-recovery-policies-to-head-off-the-headwinds-by-mohamed-a-el-erian-2021-03>

Barry Eichengreen: Ragnar Nurkse & the International Financial Architecture: ���Estonian economist��� the early Nurkse��� concerned with exchange rates, capital flows and what today we call the international financial architecture���. How many of Nurkse���s points about the interwar gold standard are confirmed by subsequent scholarship? How many of his points are still relevant to the international monetary problems of today?��� LINK: <https://www.tandfonline.com/doi/full/10.1080/1406099X.2018.1540186>

We should not say ���my newsletter, which is on SubStack���; we should say ���my weblog, which is at the moment on substack���: 

Dan Hon: The One Where I Don���t Want To Talk About Substack Just As Much As You Do, & Yet: ���We should not say ���I have a Substack��� but instead ���my newsletter, which is on Substack���, because we should not give power to brands in this way. Are we going to see a variant of yeah, I was into {band} before they were cool as a yeah, I used {tech platform} before they became synonymous with right-wing cancelled people Actually, I will go out on a limb and make a prediction: we���re going to see a lot more of the above qualification, that ���Yeah, I used {platform} before it became known for being racist/sexist/misogynist/abusive etc.��� And that was only the first Substack thing today��� LINK: <https://danhon.substack.com/p/s09e07-the-one-where-i-dont-want>

Kaleberg: 2525: ���I���m not naturally optimistic, but I think you are too pessimistic on the technology front��� the golden age of materials science��� glimpses of what is possible with nano-structures, bio-mimetics, non-traditional metallurgy, meta-materials��� spin, as opposed to charge, based electronics is much faster and uses much less power. New classes of reflective and transmissive materials���. Much of that 2.1% technological growth has changed the commons. Rothschild couldn���t have bought a modern antibiotic, and neither can you. You can only ���buy��� amoxicillin because we have a medical-pharmacological-health insurance-research complex���. If you look to the future, it pays to think about what the commons can deliver, rather than individual components of it. Let me make some possibly correct predictions on this basis: In 2525, people will not get cancer���. People will be able to travel from point to point on the planet in less than fifteen minutes���. Energy use per-capita will be lower than today, but heating, cooling, transportation and manufacturing will be more productive. Manufacturing will increasingly be as-needed���. In some ways, society advances one patent expiration at a time���

LINK: <https://braddelong.substack.com/p/for-paying-subscribers-in-the-year/comments?token=eyJ1c2VyX2lkIjoxNjg3OSwicG9zdF9pZCI6MzMyODIxODQsIl8iOiJ5aURXViIsImlhdCI6MTYxNTU4MDM0MywiZXhwIjoxNjE1NTgzOTQzLCJpc3MiOiJwdWItNDc4NzQiLCJzdWIiOiJwb3N0LXJlYWN0aW9uIn0.nzG44aeaY2q8Q9PeGZ2SSXkWDN_fc8cFzl3vEC1yaVE#comment-1475899>

CONFERENCE COMMENT: How Should Latin Americans Understand the United States Today?

Not just Mexico but all of Latin America is "so close to the United States..."

 

The past three months in the United States have been both shocking and hopeful. 

They have sen the end of a 220 year tradition: the end of an unbroken chain in which the transfer of political power at the national (although not the state: not in the South) level is _peaceful_���a tradition that began in 1800 when president John Adams acceded to Thomas Jefferson���s electoral college victory without choosing violence. We lost that on January 6th, 2021. 

Many who wish to make excuses for Donald Trump say that it was not really an attempt by Trump (while preserving plausible deniability that the attempt was his own action and at his behest) to have his goons and fans shoot dead the Speaker of the House, hang the Vice President, and prevent the counting of electoral votes���that it had been, rather, a spontaneous popular outburst. Nevertheless, we came remarkably close to watching the Speaker of the House shot dead and the Vice President hanged. The counting of the electoral votes was delayed. Speaker Pelosi and Majority Leader McConnell made it a point to finish the counting that day, so that the delay was short. But there was a delay. 

However, we did get our transfer of power, albeit not peacefully.

[image error]

Now we have a $1.9 trillion program���10% of a year's national income���devoted to rescue, relief, support and recovery. This is a remarkably large package. It is the result of a remarkable degree of agreement within the Democratic legislative caucuses. In the past, in both 1993 and 2009, senior Democratic legislators have been very, very interested in demonstrating that they are independent actors rather than loyal members of the party. They have been interested in demonstrating that they think for themselves rather than serve the party leader.. They have been interested in using their control of veto points to shape policy to their personal liking. Even more so, I think, they have been interested in demonstrating that they can require policy must be to their liking. 

That is much less the case this time.

I think this shift is produced by a common view of the mistakes of 2009, and probably of 1994. The legislators, I think now understand that, if they want to govern in the public interest, they have to demonstrate that the president of their party is a successful manager, and that he has their support, and that he deserves to have their support because his policies are good policies.

Here I must insert an asterisk: Senators Manchin and Sinema appear to still be playing the game by the old rules���demonstrating that they are independent voices, and hence can be trusted to do what their constituents and they believe is in the national interest on each and every issue, no matter how the party tries to corral them. Thus they hope to convince centrists, plus Republicans who are unhappy with the neo-fascist notes currently being sung by the soloists and chorus of the Republican party, to vote for them. But note that even Sinema and Manchin are only taking on this role and pose in a very moderate degree. They cheerfully voted for $1.9 trillion, even if not for changing the rules of the Senate to also include an increase in the minimum wage to $15/hour.

Why $1.9 trillion? Is that the right size? The U S government right now does have exorbitant privilege. Rich people and state actors with large amounts of money all around the globe believe that their assets held in dollars in the United States are safe assets. I do not have time to go into why they believe this. But they do. In this environment the near-consensus among the Democratic policy intellectuals is that it is appropriate to take advantage of this extraordinary demand for U.S. assets. When investor expectations and confidence shift, and when interest rates rise, then will be time to deal with the problems thus created: sufficient unto the day is the evil thereof. We bet that our successors will be intelligent and farsighted enough to deal with the economic problems of tomorrow when they arise. We do not let the fact that we are unsure about how to deal with the economic problems of tomorrow keep us from solving the economic problems of today.

[image error]

Perhaps this is the end of the neoliberal intellectual hegemony established in the 1970s, when a critical mass of thinkers came to fear that the market had its own logic that could not be resisted but that could only be accommodated. The market giveth; the market takeeth away. And the only possible response, to those who became the neoliberals, was then to say: blessed be the name of the market. 

The view today is different. It is: the market was made for man, not man for the market. 

One indication of this is that those of us who are still thinking in a more neoliberal the-market-has-its-reasons logic���most prominently now my long-time friend, teacher, and patron Larry Summers and my longtime teacher Olivier Blanchard, both of whom I love dearly���have gotten very little traction in their attempts to issue warnings that perhaps $1.9 trillion is too large, and we should be prepared to recognize that it is���if it turns out to be so���and then rapidly act to reverse course. Those warnings have gotten almost no traction despite all their intellect and influence. That is an interesting signpost to the shifting intellectual climate. 

Thus I forecast that the United States is in a position to have a rapid recovery from the coronavirus plague depression. I forecast a high-pressure U.S. economy for at least a while. That will be a marvelous thing. That will be a good thing for Latin America and others who export to the United States. A United States that becomes once again the world���s importer of last resort may become a locomotive for the world, or at least for the Americas.

Now there are deeper issues, 

A generation ago there was a very effective right-wing political tactician, Lee Atwater. He used to argue that American conservatives were no longer committed to white supremacy���that their arguments, instead, really were economic arguments about the best economic policy, and bourgeois cultural-order arguments about the best forms of social order. How could you tell that these surface rationales were not masks for positions truly rooted in white supremacy? You knew, Atwater said, because no significant fraction of Republicans was calling for the repeal of the Voting Rights Act and the mass disenfranchisement of African Americans. You knew, Atwater said, because no significant fraction of Republicans were calling for the state to sanction open discrimination. 

[image error]

Well, guess what.

John Roberts and his Supreme Court majority have constructively repealed the Voting Rights Act, and Republicans hope that they can now disenfranchise 20% of African-American voters in states they control. It���s not an attempt to disenfranchise 100%. But 20% is a thing. What do we call this open and notorious embrace of what I think is generally acknowledged to be white supremacy-light? 

And state-sponsored discrimination? As I understand it, there has been one trans-female high school athlete in all of South Dakota in the past decade. Yet banning such is the highest priority of one of the Republican Party���s stars, South Dakota Governor Noem. The Republican Party���s position is clear: where we can���wherever we can construct phony religious or phony national-security rationales for discrimination, and wherever the center of the electorate does not have a strong revulsion that would put us in electoral jeopardy���we will discriminate! Is this ���we can no longer openly discriminate against African-Americans, yet here is earnest money that we hope to be able to do in the future���?

This white supremacy-light is so very much softer than the white supremacy of even two generations ago, let alone four, or six when the twenty-five million white citizens of the United States held five of the six million African-Americans in the bondage of slavery. That it is so very much softer is a mercy. And for that we give thanks.

Nevertheless, I believe that Lee Atwater���s deathbed hopes that his Republican Party was no longer anchored on white supremacy���that the real message intended for the base was not ���Ni���er! Ni���er! Ni���er!������have been proven wrong.

And once you start shrinking the electorate, you do damage to the prospects for a recovery of democracy that may be permanent.

Which brings us to the issue of countering voter suppression at this moment, when the Democratic Party has control over the all the major political veto points except for the Supreme Court. And this brings us to the so-called ���filibuster��� in the U.S. Senate.

First, it is called the ���filibuster���. A filibuster is an extraordinary, a contrary to normal procedure, a contrary to morality, raw use of power. I think none of the U.S. reporters covering the filibuster in the United States know the origins of the term in things like William Walker's 1856-1857 expedition to make himself President of Nicaragua in the middle of that country's then-civil war���an office from which he was expelled by a coalition of Central American armies in 1857, and then���IIRC���executed by the government of Honduras in 1860. That was the original ���filibuster���: to take over a country by force, and loot it.

[image error]

That procedural requirements for supermajorities in the U.S. Senate for legislation are called the ���filibuster��� suggests that there is something wrong with them. We have been seeing such procedural requirements erode. It used to be that a state���s senators��� acquiescence, at least, was required for federal judge confirmations. Reconciliation was supposed to be immune from the filibuster because it was an unimportant, technical procedure that needed to be done and that should not be allowed to become a pressure point that groups of senators could use to get their way by threatening obstruction. But Reconciliation has now become the way that business gets done in the Senate: either by or under threat of Reconciliation.

Erosions of the power of the filibuster have, with the exception of BidenRescue now, ObamaCare in 2010, and the very successful Clinton federal financial rebalancing in 1993, been overwhelmingly used to advance Republican policy priorities: tax cuts for the rich and right-wing judges. Voting rights and perhaps minimum wage expansion are equally strong Democratic legislative priorities right now. Perhaps a procedural move to carve out some more exceptions to the general legislation-requires-60-votes will win the acquiescence of Sinema and Manchin. I think the prospects for that are good. But only the senators know what the senators are thinking. It is often to their political advantage to make their thinking opaque. After all, we still do not know whether the Republicans failed to repeal Obamacare during the Trump administration���was it simply because Senator McCain had decided he had had enough, or were there ten senators who did not want it repealed who were happy to let McCain be the hero, but who would have stepped up to fill his role had it been necessary?

This is related to the question of the missing middle in American politics. Structurally, the 20 most centrist senators have the power to drive legislation and governance according to their priorities. And there are stories of how it used to be so back in the 1980s and before���how centrists of that day like Bentsen of Texas and Danforth of Missouri were setters of national agendas whom presidents found themselves lobbying more often than the reverse. But over the past two generations that pattern has disappeared completely.

Republican centrist senators have turned out, since 1992, to have much more allegiance to whatever the current priorities of their party leaders are than to the norms of centrist governance. Now all the Democratic centrists senators���with the partial exceptions of Sinema and Manchin���appear to have reached the same conclusion: that their job is to support their party leaders to the extent they can without risking their reelection, rather than to be a centrist vote block that drives policy to what it wishes.

This is something that I would like some very smart political scientists to explain to me. I am puzzled. And let me close with that puzzlement.

2075 words

 

Econ 135: 4.3.3., 4.4.3., & 4.5.3. Zoom Session: Globalization, Convergence, & Underdevelopment :: Slides

https://www.icloud.com/keynote/0m1Ser_mPMUYJ2H2EvS8ydlTw
https://github.com/braddelong/public-files/blob/master/ECON-135-4.%5B3-5%5D.3-zoom-session-slides.pptx
2021-03-16 Tu

BRIEFLY NOTED: for 2021-02-13 Sa

Things that went whizzing by that I want to remember...

 

First:

James Robinson is scared at the large-scale soft treason of Republican actual and wannabee office holders, but I do not think he is scared enough.

It is not at all clear to me that Trumpian populism has failed. Trump has failed. But neofascism remains a mighty powerful force. If James Robinson would talk to Trumpists, he would recognize that Trump did ���deliver the goods������they imagine that, before the coming of the plague, they were enjoying an unparalleled economic boom; and they are not mistaken to think that Trump delivered the hate he had promised against immigrants, against uppity Blacks who did not know and stay in what Trumpists continue to think is their proper place, and against rootless cosmopolites. The only problem is that the center of the electorate is not���or is not yet���Trumpian. And, for some reason, the knives that actors from James Comey to Dean Baquet used to stab Hillary Rodham Clinton in the back failed to hit Joe Biden���s back this time, for lots of reasons:

James A. Robinson: Why Trumpian Populism Failed: ���US democracy remains vulnerable��� owing to many Americans��� lack of commitment to democratic institutions. While Trump worked to de-institutionalize America and enrich himself while in office, the Republican Party either sat on its hands or in some cases applauded���. At the end of the day, Trump���s ���America First��� was mostly posturing, because he couldn���t deliver real improvements in the lives of his base. All successful autocrats���like former Venezuelan President Hugo Ch��vez, postwar Argentine President Juan Per��n, or current Ugandan President Yoweri Museveni���somehow ���deliver the goods��� for their core constituencies. Trump delivered, but only to the rich, by cutting taxes and regulations. His symbolic gestures won���t endure, and his ���Make America Great Again��� slogan is destined for burial at the back of millions of American closets.

Republicans would be wise to consider this. Instead, much of the party, both in Congress and at the state and local level, still clings to the false narrative of election fraud and support for the insurrectionists, or advances the notion that the storming of the Capitol was staged to undermine Trump. This is deeply concerning. Per��n was able to rule as he did after World War II because increased presidential meddling in Argentina���s Supreme Court and political institutions had eroded these bodies over the previous 15 years. Most Americans do not want to go down this path, even if many of their elected political leaders do��� 

LINK:

 

Very Briefly Noted:

Charles West: What is a History Lecture For? <http://turbulentpriests.group.shef.ac.uk/what-is-a-history-lecture-for/> <http://turbulentpriests.group.shef.ac.uk/what-is-a-history-lecture-for-part-ii-transcripts/>

Lauren Aldredge: Getting Started with mmhmm<https://www.youtube.com/watch?v=4RlaqfJoFkM>

Wikipedia: Tiger Lake <https://en.wikipedia.org/wiki/Tiger_Lake> | Rocket Lake <https://en.wikipedia.org/wiki/Rocket_Lake> | Alder Lake (microprocessor)  <https://en.wikipedia.org/wiki/Alder_Lake_(microprocessor)> | List of Intel CPU microarchitectures <https://en.wikipedia.org/wiki/List_of_Intel_CPU_microarchitecture>

Robert M. Solow: How Did Economics Get That Way & What Way Did It Get? <https://www.jstor.org/stable/pdf/20027408.pdf?casa_token=JKZFez3s9PQAAAAA:6nw29_rWVE3Ie1ee4AVjL2Ll0ZEAtRm3x3LqrH2EGvp3-hQMBnzuJNjEu0-oZ2uZbCY99IRTn7810RLwAYf31UdLVqrwtSkvF5mHYJlUxy6U4QcC>

Robert M. Solow: Economic History and Economics= <https://www.jstor.org/stable/pdf/1805620.pdf>

Jeremy Adelman & Jonathan Levy: The Fall & Rise of Economic History <https://www.chronicle.com/article/the-fall-and-rise-of-economic-history/>

Paul A. David: Path Dependence, Its Critics, & the Quest For ���Historical Economics��� <https://core.ac.uk/download/pdf/9312402.pdf>

Paul A. David: Clio & the Economics of QWERTY <https://www.jstor.org/stable/pdf/1805621.pdf>

Sidney Coleman: Quantum Mechanics in Your Face: ���There is nothing I will say in this lecture, with the exception of the carefully prepared spontaneous jokes���that was one of them���that cannot be found in the literature. Of course, such is the nature of the subject that there is nothing I will say where the contradiction cannot also be found in the literature. So I claim a measure of respon- sibility, if no credit���the reverse of the usual scholarly procedure.��� LINK: <https://arxiv.org/pdf/2011.12671.pdf>

One Video:

A very, very nice talk���the intellectual grandchild of Ragnar Nurkse, by way of Nicola Gennaioli and Andrei Shleifer:

Ivan Werning: Taming a Minsky Cycle <https://www.youtube.com/watch?v=B_pJsPXUVMs>:

 

Five Paragraphs:

Reminds me of the steel industry around 1900: an absolutely key commodity, with very few firms able to compete at world-class levels of efficiency, cost, and value, and with downstream implications for the prosperity of entire economies:

Debby Wu, Sohee Kim, Gao Yuan & Peter Elstrom: The Race for Chip Supremacy Could Reshape the World: ���Carmakers from Tokyo to Detroit are slashing production. PlayStations are getting harder to find in stores. Even aluminum producers warn of a potential downturn ahead. All have one thing in common: an abrupt and cascading global shortage of semiconductors��� chips���. World leaders from Washington to Beijing are making chip supplies a top priority��� to keep factories running and ensure national security. Hundreds of billions will be spent in a plethora of sectors in coming years on a global ���chip race������. Key Coverage: Jack Ma Crackdown Casts a Chill on China���s Tech Entrepreneurs. China Revs Up Grand Chip Ambitions to Counter U.S. Blacklistings. Chip Shortage Poses a Risk to the Global Economic Recovery. By The Numbers: $28 billion, the amount TSMC plans to spend on new plants and equipment this year; 81%, share of the semiconductor foundry business controlled by Taiwan and South Korea; $61 billion, estimated lost auto-industry revenue in 2021. Why It Matters���. A handful of missing parts can close auto factories���. The U.S. is willing to choke off chip supplies to its national champions, a vulnerability that Xi Jinping and the Communist Party view as intolerable. Beijing will pour more than $100 billion into efforts to build its own domestic chip industry���. Governments and companies will clash for years to come over semiconductor supremacy���

LINK: <https://www.bloomberg.com/news/storythreads/2021-03-09/the-race-for-chip-supremacy-could-reshape-the-world>

The state of my subdiscipline:

Ran Abramitzky: Economics & the Modern Economic Historian: ���I reflect on the role of modern economic history in economics. I document a substantial increase in the percentage of papers devoted to economic history in the top���5 economic journals over the last few decades. I discuss how the study of the past has contributed to economics by providing ground to test economic theory, improve economic policy, understand economic mechanisms, and answer big economic questions. Recent graduates in economic history appear to have roughly similar prospects to those of other economists in the economics job market. I speculate how the increase in availability of high quality micro level historical data, the decline in costs of digitizing data, and the use of computationally intensive methods to convert large-scale qualitative information into quantitative data might transform economic history in the future���

LINK: <https://www.nber.org/system/files/working_papers/w21636/w21636.pdf>

Anne E. C. McCants: Economic History & the Historians: ���An economics that refuses to engage with the lessons of history or to engage in a dialog about justice and values, or ethics, can go in any or all of three directions: (1) It can wish itself back to a past that never existed, at least not in the way that intellectual shortsightedness remembers it. (2) It can lose sight of the multiplicity of human interactions across varied, but always interconnected, spheres of life���political, social, aesthetic, spiritual, or communal, among others���that affect our attempts to solve specific economic problems. It can become ever-more clever in its ability to build models, test hypotheses, and manipulate data while still remaining confused or, even worse, small-minded about the ends to which its analytical efforts are geared to pursue���

Nice to see all of this intellectual evolution collected in one place;

Pablo Gabriel Bortz: Keynes���s Theories of the Business Cycle: Evolution and Contemporary Relevance: ���The paper identifies six different ���theories��� of business fluctuations. With different theoretical frameworks in a 30-year span, the driver of fluctuations���namely cyclical changes in expectations about future returns���remained substantially the same. The banking system also played a pivotal role��� financing and influencing the behavior of return expectations. There are four major changes��� a) the saving���investment framework��� b) the capabilities of the banking system to moderate the business cycle; c) the effectiveness of monetary policy to fine-tune the business cycle��� and d) the role of a comprehensive fiscal policy and investment policy���

LINK: <http://www.levyinstitute.org/publications/keyness-theories-of-the-business-cycle-evolution-and-contemporary-relevance>

Origins of the word ���filibuster���: it���s not a nice word, and it never had a nice meaning:

Wikipedia: William Walker: ���William Walker (May 8, 1824 ��� September 12, 1860) was an American physician, lawyer, journalist, and mercenary who organized several private military expeditions into Mexico and Central America with the intention of establishing English-speaking colonies under his personal control, an enterprise then known as ���filibustering���. Walker usurped the presidency of Nicaragua in July 1856 and ruled until May 1, 1857, when he was forced out[2] of the presidency and the country by a coalition of Central American armies. He returned in an attempt to re-establish his control of the region and was captured and executed by the government of Honduras in 1860��� 

LINK: <https://en.wikipedia.org/wiki/William_Walker_(filibuster)>

Hoisted from the Archives:

2017: Ricardo's Big Idea, and Its Vicissitudes: Gains from Trade: Is Comparative Advantage the Ideology of the Comparatively Advantaged?<https://www.youtube.com/watch?v=uCgUkfhB8Uk>:

 

Slides: <https://github.com/braddelong/public-files/blob/master/2017-10-22-inet-edinburgh-ricardos-big-idea.pptx> <https://www.icloud.com/keynote/0QMFGpAUFCjqhdfLULfDbLE4g>

Notes: <https://www.bradford-delong.com/2017/12/gains-from-trade-is-comparative-advantage-the-ideology-of-the-comparatively-advantaged.html>

Ricardo's Big Idea, and Its Vicissitudes: Gains from Trade: Is Comparative Advantage the Ideology of the Comparatively Advantaged?: Hoisted from the Archives: 2017

<https://www.youtube.com/watch?v=uCgUkfhB8Uk>:

Slides: <https://github.com/braddelong/public-files/blob/master/2017-10-22-inet-edinburgh-ricardos-big-idea.pptx> <https://www.icloud.com/keynote/0QMFGpAUFCjqhdfLULfDbLE4g>

Notes: <https://www.bradford-delong.com/2017/12/gains-from-trade-is-comparative-advantage-the-ideology-of-the-comparatively-advantaged.html>

 

Ricardo believes in labor value prices because capital flows to put people to work wherever those things can be made with the fewest workers. This poses a problem for Ricardo: The LTV tells him that capitalist production should take place according to absolute advantage, with those living in countries with no absolute advantage left in subsistence agriculture.

The doctrine of comparative advantage is Ricardo���s way out. For him, the LTV holds within countries. Countries��� overall price levels relative to each other rise and fall as a result of specie flows until trade balances. And what is left is international commodity price differentials that follow comparative advantage. Merchants profit from these differentials, and their demand induces specialization.

Thus Ricardo reconciles his belief in the LTV with his belief in Hume���s ���On the Balance of Trade��� and with the fact that capitalist production is not confined to the industry-places with the absolute advantage. His doctrine reconciles his conflicting theoretical commitments with the reality he sees, as best he can.

By now, note that we are far away from the idea that ���comparative advantage��� justifies the claim that free trade is for the best in the best of all possible worlds. There are a large number of holes in that argument:

Optimal tariffs.
The fact of un- and underemployment.
Externalities as sources of economic growth, in any of the ���extent of the market���, ���economies of scale���, ���variety���, ���learning-by-doing���, ���communities of engineering practice���, ���focus of inventive activity���, or any of its other flavors.
Internal misdistribution means that the greatest profit is at best orthogonal to the ���greatest good of the greatest number��� that policy should seek.

Given these holes, the true arguments for free trade have always been a level or two deeper than ���comparative advantage���: that optimal tariff equilibrium is unstable; that other policy tools than trade restrictions resolve unemployment in ways that are not beggar-thy-neighbor; that countries lack the administrative competence to successfully execute manufacturing export-based industrial policies; that trade restrictions are uniquely vulnerable to rent seeking by the rich; and so forth.

The only hole for which nothing can be done is the internal misdistribution hole. Hence the late 19th C. ���social Darwinist��� redefinition of the social welfare function as not the greatest good of the greatest number but as the evolutionary advance of the ���fittest������that is, richest���humans.

Hence ���comparative advantage��� takes the form of an exoteric teaching: an ironclad mathematical demonstration that provides a reason for believing political-economic doctrines that are in fact truly justified by more complex and sophisticated arguments. And, I must say, arguments that are more debatable and dubious than a mathematical demonstration that via free trade Portugal sells the labor of 80 men for the products of the labor of 90 while England sells the labor of 100 men for the products of the labor of 110.

But even if you buy all the esoteric arguments that underpin the exoteric use of comparative advantage on the level of national political economy, there still is the question of the global wealth distribution. Stipulate that the Arrow-Debreu-Mackenzie machine generates a Pareto-optimal result. Stipulate that every Pareto-optimal allocation maximizes some social welfare function. What social welfare function does the Arrow-Debreu-Mackenzie machine maximize.

It maximizes the social welfare function with Negishi weights. When individual utilities are weighted before they are added, each individual���s is waited by the inverse of their marginal utility of wealth. If the typical individual utility function has curvature that corresponds to a relative risk aversion of one, then Negishi weights are proportional to each individual���s wealth. For a relative risk aversion of three, Negishi weights are proportional to the cube of each individual���s wealth.

���Comparative advantage��� is the market economy on the international scale. And the market economy is a collective human device for satisfying the wants of the well-off. And the well-off are those who control scarce resources useful in producing things for which the rich have a serious Jones.

Thank you.

2017-10-22 :: 673 words

How Did the ���Global South��� Become so Underdeveloped?

https://www.icloud.com/keynote/0Td2okG4-n-z59HeH8UYMjdHA