supply and command

Homocidal Maniac Doing Fieldwork

The weirdest story I have ever read: Murder Most Academic.

Dalrymple on English riots and Amy Winehouse

British intellectual Theodore Dalrymple has this to say about the riots in the ever more disunited Kingdom. And he takes a mighty whack at a recently-beautified British Icon. Merciless but entertaining, as always:

Relatively poor as the rioting sector of society is, it nevertheless possesses all the electronic equipment necessary for the prosecution of the main business of life; that is to say, entertainment by popular culture. And what a culture British popular culture is!

Perhaps Amy Winehouse was its finest flower and its truest representative in her militant and ideological vulgarity, her stupid taste, her vile personal conduct and preposterous self-pity.

Her sordid life was a long bath in vomitus, literal and metaphorical, for which the exercise of her very minor talent was no excuse or explanation. Yet not a peep of dissent from our intelllectual class was heard after her near canonisation after her death, that class having long had the backbone of a mollusc.

Turner Likes Heidelberg!

Is Ed Miliband on Cocaine?

The Henry Jackson Society worries about the well-being of UK Labour Party leader Ed Miliband. And rightly so, given his strange and involuntarily hilarious performance in a BBC interview on the ongoing union strikes in Britain. Obviously, Miliband's preparation for the interview consisted of memorising a single sentence containing a few standard labour talking points ("these strikes are wrong!" "the government acted in a provocative manner" "both sides should put away the rhetoric" "orchids are pretty"), which he uses to reply to all of the interviewer's questions. As far as political communication is concerned, this could be the blunder of the decade. Watch it here (lower quality youtube version here).

Merchant Networks Panel at EBHC

The 14th ANNUAL CONFERENCE OF THE EUROPEAN BUSINESS HISTORY ASSOCIATION 2010 is coming up soon. This time the meeting will be held in lovely Glasgow, Scotland.

Andrea Caracausi has organised a panel on business and merchant networks to which I will be contributing a paper. The aim of the meeting is to explore methodological overlaps between economic  network theory and the historical study of networks. Here's the panel abstract:

"BUSINESS AND MERCHANT NETWORKS IN HISTORICAL PERSPECTIVE: TOWARDS A FORMAL APPROACH

During the last decades, the concept of “network” has fascinated historians. Using approaches drawn from other social sciences, business historians, as well as scholars in economic and social history, have tried to explain in terms of network analysis the rise and fall of businesses, families and also institutions such as the State or financial markets. However, the same concept of “network” remains too vague, and the dialogue between scholars of different backgrounds is very poor.

The aim of this session is to fill this gap in economic and business history. Our idea is to start a confrontation of the formal models in use to study and compare networks in history, trying to extend the usual approach to graph statistics (centrality etc.) using a measure of complementarities (drawn from organisational studies) and inserting (or adding) a consideration for conflict and power (asymmetries, inclusion/exclusion) via vectors and similar tools. We propose four exemplary case-studies on different periods (from the pre-modern to the contemporary period) and topics (merchant networks and social networks in the pre-modern period; business networks in 19th and 20th centuries) in order to discuss how a common formal approach could be useful both in the study of business networks and in the dialogue between history and the social sciences."

Brigstocke Explains Recession

Best Editorial Commentary on Greece

Who writes the best, most lucid and insightful commentaries on the Greek debt crisis, intelligible for a general audience?

It is Times columnist Oliver Kamm. Here's a little linkography to his blog posts on the issue:

• Why the Euro will not be dismantled even if Greece were to default on her debt.
• Why Greece will not leave the Eurozone II.
• Why Greece will not leave the Eurozone I.
• Why Eurozone countries do well in times of crisis.

Oliver also runs an entertaining series on his blog, entitled "Great Historical Questions to Which the Answer is No". Here's my favourite. This one is also worth reading.

Economics is not for Ideologues

International Economics points me to the most boneheaded opinion piece to have been spotted in the international media in 2009. Just look at it:

"As much of mainstream economics became obsessed with navel-gazing esoteric models or theories designed to justify market liberalism, the public became relatively more alienated from the activities of economists. [...] Monetarist and free market approaches have been disproportionately rewarded, often at crucial times. For example, the 1974 award to Friedrich von Hayek led to a resurgence of interest in the Austrian school and made his book The Road to Serfdom a bestseller. Two years later the prize went to Milton Friedman, making his extreme form of monetarism academically respectable and even leading to a conservative policy revolution. Economic history in the turgid and restricting form of retrospective econometrics was promoted by the 1993 award to Robert Fogel and Douglass North, while rational expectations theory was given a big boost by honouring Robert Lucas in 1995.
The geographical distribution of the award both creates and reflects power hierarchies in the discipline. The economics prize has been awarded 40 times to 62 recipients, 42 of whom have been from the US, while more than 50 were working in the US at the time of the award. The University of Chicago has 11 laureates, leading to the joke about "the Stockholm-Chicago Express". This does not reflect the actual state of economic knowledge so much as the biases and blindness of the jury. Only two people from developing countries have received it (Arthur Lewis and Amartya Sen) and both worked in the US and Britain. Only three with an interest in the economics of developing countries – which is the economic reality for around three quarters of the world's population – have received the award.
In recent years the prize has been focused on financial market behaviour. In 1997, the award went to two economists – Robert Merton and Myron Scholes – who were supposed to have discovered a method of valuing derivatives that could reduce or eliminate risk in financial investment. When the hedge fund they ran (Long Term Capital Management) went bust within the year and had to be rescued by the US federal reserve, there was some embarrassment. Perhaps to right this wrong, a few years later the prize was given to economists George Akerlof and Joseph Stiglitz, who had pointed to the imperfect functioning of financial markets. The award last year to Paul Krugman may also have indicated some bowing to changing times.
So far, no woman has received the economics Nobel. Apart from obvious exclusions such as Joan Robinson, this also reflects power hierarchies within the subject, because women economists even in the US and UK tend to be concentrated in the lower reaches of the academics profession, as researchers and lecturers rather than professors."

This could be taken as harmless comedy were it not so prevalent in public discourse nowadays. I keep being amazed by the ideological hollering that many media commentators have subscribed to in response to the so-called economic crisis. But following the widespread banker-bashing that often received applause even from mainstream politicians, it should come as no surprise that academic economists are also on the blacklist. On the plus side, defenders of rational debate now have an even easier job debunking ill-informed blahblah such as the above article. So let's take it step by step:

Getting into an Elite University #1

From the Oxford University graduate prospectus (online edition):

(click to enlarge)

 

Would a Children Scrappage Scheme Work?

The BBC' Stephanie Flanders offers a few thoughts on the UK car scrappage scheme, which apparently has done wonders to the British car industry. However, as Flanders points out, the UK may have profited to an even greater extent from German spending programmes: 

"The car industry is delighted that Lord Mandelson has expanded the government's car scrappage scheme. But I'm tempted to say they lobbied the wrong government. Getting Germany to extend its much more generous scheme - which expired at the start of this month - might have done the average British car worker more good.
Consider the arithmetic. The UK now plans to spend another £100m on its scrappage scheme, bringing the grand total to £400m. That sounds exciting until you hear that Germany's scheme cost 5bn euros (£4.6bn). In other words, more than ten times as much. Under the German scheme, the government provided a rebate of 2,500 euros to everyone exchanging an old car for a new one. Two million Germans have bought cars under the scheme - compared to 227,000 so far in the UK scheme.
Why does this matter - other than confirming that German governments are a lot more into cars? It matters because some of those new cars being bought in Germany were made in the UK."

I have long been puzzled by the success of the German scrappage scheme, so it comes at no surprise that other governments would want to imitate a stimulus programme that has worked so well in reviving an ailing industry. Now I wonder if it wouldn't be wise to extend the promise of 2500 Euros to other domains. If consumers can be induced to spend, on average, more than 20.000 Euros on new cars regardless of the expected follow-up costs (e.g. higher taxes) ONLY because governments offer to chip in a tiny fraction of the cost price, then they surely must respond as strongly to similar incentives. Case in point: European economies suffer from low birth rates, which are destined to break the neck of the European welfare model sooner or later (public pension schemes in particular). What, now, if governments were to pay their citizens for conceiving children? 2500 Euros per child born within the next nine months, anyone?