Saturday, June 27, 2009
Thursday, June 25, 2009
The 36th Annual Conference of the History of Economic Society
2009 Annual Conference
Denver, Colorado
The 36th Annual Conference
of the History of Economic Society will be held June 26-29, 2009 at
the University of Colorado Denver.
There is an optional reception on Friday, June 26. Conference
sessions will begin on the morning of Saturday, June 27. The
conference will run until mid-day on Monday, June 29. For
travel accommodations, please try to plan on leaving Monday in the
late afternoon or evening. The airport is only a 40 minute taxi ride
from downtown Denver.
Monday, June 22, 2009
Thursday, June 18, 2009
Why No One Can Guess When Main Street Recovery will Occur
Henry Ford said, "History is bunk." Even more cynically, Napoleon said, "History is a set of fables agreed upon."
Both had a point.
But back in the early 1930s, during the Great Depression, President John F. Kennedy's father, Old Joe Kennedy, made two fortunes betting that stocks would keep falling and unemployment would keep growing.
He disbelieved in early New Deal recoveries.
Both had a point.
But back in the early 1930s, during the Great Depression, President John F. Kennedy's father, Old Joe Kennedy, made two fortunes betting that stocks would keep falling and unemployment would keep growing.
He disbelieved in early New Deal recoveries.
Wednesday, June 17, 2009
Micromotives and Macrobehavior
I just started Thomas Schelling's book and it makes a wonderfully clear connection between micro and macroeconomics.
Tuesday, June 16, 2009
Sweatshops
This great post by Don Don Boudreaux
I'm surprised by the number of commenters who write as if harsh working conditions of the sort found in sweatshops are something exceptional, something visited upon people in developing countries by we rich folk in developed countries, something crying out for an explanation.
In fact, such conditions have been the norm throughout human history. Life on subsistence farms - which was the lot of the vast majority of our ancestors for the past 10,000 years - was grueling, dreary, and dangerous. And the material returns eked out from the work effort were, well, subsistence - except in the bad times, of which there were many, when these returns were at less than subsistence level. People then literally starved to death. (Indeed, compared with working in subsistence agriculture, working in a sweatshop is surely better - which is one important reason why so many people, today as in the past, have chosen to leave their bucolic hells for cities and towns.)
I'm surprised by the number of commenters who write as if harsh working conditions of the sort found in sweatshops are something exceptional, something visited upon people in developing countries by we rich folk in developed countries, something crying out for an explanation.
In fact, such conditions have been the norm throughout human history. Life on subsistence farms - which was the lot of the vast majority of our ancestors for the past 10,000 years - was grueling, dreary, and dangerous. And the material returns eked out from the work effort were, well, subsistence - except in the bad times, of which there were many, when these returns were at less than subsistence level. People then literally starved to death. (Indeed, compared with working in subsistence agriculture, working in a sweatshop is surely better - which is one important reason why so many people, today as in the past, have chosen to leave their bucolic hells for cities and towns.)
Monday, June 15, 2009
Sunday, June 14, 2009
The man of system - Barney Frank
A great post on Barney Frank that illustrates the man of system from Adam Smith:
Theory of Moral Sentiments:
Part VI. Of the Character of Virtue, Section I. Of the Character of the Individual, so far as it affects his own Happiness; or of Prudence
VI.II.43
Some general, and even systematical, idea of the perfection of policy and law, may no doubt be necessary for directing the views of the statesman. But to insist upon establishing, and upon establishing all at once, and in spite of all opposition, every thing which that idea may seem to require, must often be the highest degree of arrogance. It is to erect his own judgment into the supreme standard of right and wrong. It is to fancy himself the only wise and worthy man in the commonwealth, and that his fellow-citizens should accommodate themselves to him and not he to them. It is upon this account, that of all political speculators, sovereign princes are by far the most dangerous. This arrogance is perfectly familiar to them. They entertain no doubt of the immense superiority of their own judgment. When such imperial and royal reformers, therefore, condescend to contemplate the constitution of the country which is committed to their government, they seldom see any thing so wrong in it as the obstructions which it may sometimes oppose to the execution of their own will. They hold in contempt the divine maxim of Plato, and consider the state as made for themselves, not themselves for the state. The great object of their reformation, therefore, is to remove those obstructions; to reduce the authority of the nobility; to take away the privileges of cities and provinces, and to render both the greatest individuals and the greatest orders of the state, as incapable of opposing their commands, as the weakest and most insignificant.
Wealth of Nations
B.IV, Ch.2, Of Restraints upon the Importation from Foreign Countries
IV.2.10
What is the species of domestic industry which his capital can employ, and of which the produce is likely to be of the greatest value, every individual, it is evident, can, in his local situation, judge much better than any statesman or lawgiver can do for him. The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it.
Theory of Moral Sentiments:
Part VI. Of the Character of Virtue, Section I. Of the Character of the Individual, so far as it affects his own Happiness; or of Prudence
VI.II.43
Some general, and even systematical, idea of the perfection of policy and law, may no doubt be necessary for directing the views of the statesman. But to insist upon establishing, and upon establishing all at once, and in spite of all opposition, every thing which that idea may seem to require, must often be the highest degree of arrogance. It is to erect his own judgment into the supreme standard of right and wrong. It is to fancy himself the only wise and worthy man in the commonwealth, and that his fellow-citizens should accommodate themselves to him and not he to them. It is upon this account, that of all political speculators, sovereign princes are by far the most dangerous. This arrogance is perfectly familiar to them. They entertain no doubt of the immense superiority of their own judgment. When such imperial and royal reformers, therefore, condescend to contemplate the constitution of the country which is committed to their government, they seldom see any thing so wrong in it as the obstructions which it may sometimes oppose to the execution of their own will. They hold in contempt the divine maxim of Plato, and consider the state as made for themselves, not themselves for the state. The great object of their reformation, therefore, is to remove those obstructions; to reduce the authority of the nobility; to take away the privileges of cities and provinces, and to render both the greatest individuals and the greatest orders of the state, as incapable of opposing their commands, as the weakest and most insignificant.
Wealth of Nations
B.IV, Ch.2, Of Restraints upon the Importation from Foreign Countries
IV.2.10
What is the species of domestic industry which his capital can employ, and of which the produce is likely to be of the greatest value, every individual, it is evident, can, in his local situation, judge much better than any statesman or lawgiver can do for him. The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it.
Saturday, June 13, 2009
Friday, June 12, 2009
Travels of a T Shirt in the Global Economy - Part 2
In a previous post I referred to my use of Rivoli's Travels of a T Shirt as a text for The World Economy at MCC. Below is part 2 of the excellent NPR podcast.
The World in a T-Shirt
The World in a T-Shirt
U.S. Town's Economy Shifts Away from T-Shirt Business
Until recently, Florence, Ala., considered itself the T-shirt capital of the U.S. That was a few years ago, prior to a surge in cheap imports from China and other countries. Today, the T-shirt mills are all gone, along with all the jobs they once provided.Thursday, June 11, 2009
Bill Easterly - Poverty is not a violation of human rights
The title of this blog will make many think I am callous, and yet I definitely agree that poverty is an EXTREMELY BAD THING. Perhaps some use the words “human rights violation” to be equivalent to “extremely bad thing,” but why? There are many different “extremely bad things,” and it helps if everybody discriminates between them.
Wednesday, June 10, 2009
Virtue and vice
Adam Smith underscores the importance of institutional support for natural liberty in The Theory of Moral Sentiments. In discussing character, virtue and vice, he writes:
Vice is always capricious: virtue only is regular and orderly.
In a previous post I described the discussion of TMS by Russ Roberts and Dan Klein over at EconTalk. I recommend a listen - this investment in time will really deepen your appreciation of Smith.
Vice is always capricious: virtue only is regular and orderly.
In a previous post I described the discussion of TMS by Russ Roberts and Dan Klein over at EconTalk. I recommend a listen - this investment in time will really deepen your appreciation of Smith.
EconTalk Book Club
Dan Klein and Russ Roberts offer a six-part podcast series reading and discussing The Theory of Moral Sentiments (TMS), by Adam Smith.
See the List of TMS Podcasts below for the complete set of podcasts. See also the Links to the Book for various online, in-print, audio, and other media formats for the book.
If you would likTuesday, June 9, 2009
Rose Johnson - Unintended Consequences
As I relaxed yesterday to enjoy the newspaper, I can across the following article about the tragic death of a local artist - the result of perverse incentives, unintended consequences and the coercion of the government. While this took place in Bali, this blog posting shows how frequent it is in the US, with equally devastating consequences.
"Artist Rose Johnson, an English-born painter and muralist who spent more than 20 years working in Phoenix and Bisbee, was among 25 people who died after drinking homemade liquor in Indonesia.
Bisbee artist among 25 killed by tainted liquor
The Associated Press
Tucson, Arizona | Published: 06.03.2009
"Artist Rose Johnson, an English-born painter and muralist who spent more than 20 years working in Phoenix and Bisbee, was among 25 people who died after drinking homemade liquor in Indonesia.
Methanol, also known as wood alcohol, can be used for fuel and is an ingredient in formaldehyde as well as plastics and paints.
Alcohol is heavily taxed in Indonesia, the world's most-populous Muslim nation, and the high prices have spawned a huge black market for wine and liquor."
Monday, June 8, 2009
Travels of a T Shirt in the Global Economy
I am using this book in my World Economy class this summer. NPR has an outstanding resource site - below is the a sense of the information from Part 1 of the book.
After 200 Years, U.S. Remains King of Cotton
April 26, 2005 · Much of the world's cotton comes from Texas, even though it's not a particularly great place to grow the crop. Big subsidies and heavy technology and R&D spending have helped the United States dominate the global cotton trade for two centuries.
Sunday, June 7, 2009
Theory of Moral Sentiments - Virtue and Natural Liberty
In a system of natural liberty the role of the government is clear and limited in its use of coercion.
Smith writes, perceptively:
The wisdom of every state or commonwealth endeavours, as well as it can, to employ the force of the society to restrain those who are subject to its authority, from hurting or disturbing the happiness of one another. The rules which it establishes for this purpose, constitute the civil and criminal law of each particular state or country.
Smith goes on to outline the character and virtue of the "perfectly innocent and just man" a rare individual indeed. This is clearly the rationale for institutional evolution to shape the behavior of those of use who are not this rare individual.
Smith describes this rare individual:
A sacred and religious regard not to hurt or disturb in any respect the happiness of our neighbour, even in those cases where no law can properly protect him, constitutes the character of the perfectly innocent and just man; a character which, when carried to a certain delicacy of attention, is always highly respectable and even venerable for its own sake, and can scarce ever fail to be accompanied with many other virtues, with great feeling for other people, with great humanity and great benevolence. It is a character sufficiently understood, and requires no further explanation.
Section II Of the Character of the Individual, so far as it can affect the Happiness of other People
Saturday, June 6, 2009
Douglas Irwin - analysis of trade
I have been rereading Doug Irwin in preparation for teaching The World Economy.
Both books are outstanding, Against the Tide, in particular, is very helpful in examining the theories of trade and protectionism in an historical context.
Both books are outstanding, Against the Tide, in particular, is very helpful in examining the theories of trade and protectionism in an historical context.
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Friday, June 5, 2009
A special report on entrepreneurship
This special report from The Economist is well worth a read.
The United States of Entrepreneurs
Mar 12th 2009
From The Economist print edition
America still leads the world
FOR all its current economic woes, America remains a beacon of entrepreneurialism. Between 1996 and 2004 it created an average of 550,000 small businesses every month. Many of those small businesses rapidly grow big. The world’s largest company, Wal-Mart, was founded in 1962 and did not go public until a decade later; multi-million dollar companies such as Google and Facebook barely existed a decade ago.
America was the first country, in the late 1970s, to ditch managerial capitalism for the entrepreneurial variety.
The United States of Entrepreneurs
Mar 12th 2009
From The Economist print edition
America still leads the world
FOR all its current economic woes, America remains a beacon of entrepreneurialism. Between 1996 and 2004 it created an average of 550,000 small businesses every month. Many of those small businesses rapidly grow big. The world’s largest company, Wal-Mart, was founded in 1962 and did not go public until a decade later; multi-million dollar companies such as Google and Facebook barely existed a decade ago.
America was the first country, in the late 1970s, to ditch managerial capitalism for the entrepreneurial variety.
Thursday, June 4, 2009
Niall Ferguson on Paul Kurgman
It is a brave or foolhardy man who picks a fight with Mr Krugman, the most recent recipient of the Nobel Prize for Economics. Yet a cat may look at a king, and sometimes a historian can challenge an economist.
Wednesday, June 3, 2009
Thonas Sowell - Burke v Obama
Burke and Obama
By Thomas Sowell
The other day I sought a respite from current events by re-reading some of the writings of 18th century British statesman Edmund Burke. But it was not nearly as big an escape as I had thought it would be.
When Burke wrote of his apprehension about "new power in new persons," I could not help think of the new powers that have been created by which a new President of the United States -- a man with zero experience in business -- can fire the head of General Motors and tell banks how to run their businesses.
Not only is Barack Obama new to the presidency, he is new to running any organization. One of Burke's fears was that "we may place our confidence in the virtue of those who have never been tried."
Neither eloquence nor zeal was a substitute for experience, according to Burke. He said, "eloquence may exist without a proportionate degree of wisdom." As for zeal, Burke said: "It is no excuse for presumptuous ignorance that it is directed by insolent passion."
By Thomas Sowell
The other day I sought a respite from current events by re-reading some of the writings of 18th century British statesman Edmund Burke. But it was not nearly as big an escape as I had thought it would be.
When Burke wrote of his apprehension about "new power in new persons," I could not help think of the new powers that have been created by which a new President of the United States -- a man with zero experience in business -- can fire the head of General Motors and tell banks how to run their businesses.
Not only is Barack Obama new to the presidency, he is new to running any organization. One of Burke's fears was that "we may place our confidence in the virtue of those who have never been tried."
Neither eloquence nor zeal was a substitute for experience, according to Burke. He said, "eloquence may exist without a proportionate degree of wisdom." As for zeal, Burke said: "It is no excuse for presumptuous ignorance that it is directed by insolent passion."
Tuesday, June 2, 2009
All-Hayekian Fantasy Economics Team?
This is a great post over at Taking Hayek Seriously:
Larry Elliott, economics editor of the Guardian, takes a look at the economics profession and sees a professoriate detached from reality and incapable of fielding an “Fantasy Football” team of living All-Stars to fill out a modern “TEAM KEYNES” or contemporary “TEAM HAYEK”. You’ll find a bit of Elliott’s case quoted below. But I’m not so sure Elliott is right, as least in the instance of Hayek, even by Elliot’s own criteria. What Elliott is looking for are top notch modern day Hayekian or free market economists keenly interesting in explaining how the world actually works, with a healthy skepticism toward mathematical models or formalism for its own sake. Here are my own top ten draft picks for “TEAM HAYEK”. You can add your own in the comments.
No. 1 Draft Pick: DOUGLASS NORTH
No. 2 Draft Pick: ROBERT HIGGS
No. 3 Draft Pick: ISRAEL KIRZNER
No. 4 Draft Pick: VERNON SMITH
No. 5 Draft Pick: ROGER GARRISON
No. 6 Draft Pick: PETER BOETTKE
No. 7 Draft Pick: LAWRENCE WHITE
No. 8 Draft Pick: JAMES BUCHANAN
No. 9 Draft Pick: GEORGE SELGIN
No. 10 Draft Pick: HERNANDO DE SOTO
Larry Elliott, economics editor of the Guardian, takes a look at the economics profession and sees a professoriate detached from reality and incapable of fielding an “Fantasy Football” team of living All-Stars to fill out a modern “TEAM KEYNES” or contemporary “TEAM HAYEK”. You’ll find a bit of Elliott’s case quoted below. But I’m not so sure Elliott is right, as least in the instance of Hayek, even by Elliot’s own criteria. What Elliott is looking for are top notch modern day Hayekian or free market economists keenly interesting in explaining how the world actually works, with a healthy skepticism toward mathematical models or formalism for its own sake. Here are my own top ten draft picks for “TEAM HAYEK”. You can add your own in the comments.
No. 1 Draft Pick: DOUGLASS NORTH
No. 2 Draft Pick: ROBERT HIGGS
No. 3 Draft Pick: ISRAEL KIRZNER
No. 4 Draft Pick: VERNON SMITH
No. 5 Draft Pick: ROGER GARRISON
No. 6 Draft Pick: PETER BOETTKE
No. 7 Draft Pick: LAWRENCE WHITE
No. 8 Draft Pick: JAMES BUCHANAN
No. 9 Draft Pick: GEORGE SELGIN
No. 10 Draft Pick: HERNANDO DE SOTO
Monday, June 1, 2009
David Warsh's Economic Principals
David Warsh, author of Knowledge and the Wealth of Nations, has a very intriguing blog. It is actually more of an online column dealing with contemporary economic issues. For example:
The View from the 23rd Century
People continue to try to find the horizon. The Economist last week warned that in seeking to assign new tasks to government, President Barack Obama risks stifling the dynamism of the American economy. Business Week began a series of contributed essays building towards a special issue in August, “The Case for Optimism.” In August, too, will appear In FED We Trust: Ben Bernanke’s War on the Great Panic– a book that may propel Wall Street Journal columnist David Wessel into a Bob Woodward-like role as a chronicler of US economic policy.
I turned briefly to two books that are directly influential in disseminating the recent changes in our view of growth: The Economics of Growth, by Philippe Aghion, of Harvard University, and Peter Howitt, of Brown; and Introduction to Modern Economic Growth, by Daron Acemoglu, of the Massachusetts Institute of Technology. Both are textbooks, the former intended for advanced undergraduates or beginning graduate students, the latter for graduate students well along in their training. Both contribute substantially to the professional debate. But neither is easy reading.
The current book that comes closest to communicating a modern view of growth, I think, is The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World, by Amar Bhidé, professor of business at Columbia University., Bhidé, who is not an economist, compares his method to the evidentiary proceedings of a common law trial: he interviews experts from many disciplines, and then makes up his mind. The last author to make a substantial contribution to this literature was AnnaLee Saxenian, author of The New Argonauts: Regional Advantage in a Global Economy. Her method was frankly journalistic, but she came back with the goods. So does Bhidé.
The burden of the argument of Venturesome Economy is that that an inevitable expansion is taking place in the quantity of high-level know-how that is being developed in countries around the world – not just Japan and Korea, but India and China, Israel and Australia. If the US learns to relax and take advantage of new knowledge developed offshore, everything will be fine. But if “technonationalism” gains the upper hand – in the form of, say, a commitment to a strong US automotive industry, no matter what the cost – then a world carved into trading spheres could experience slower growth than otherwise would be the case.
People continue to try to find the horizon. The Economist last week warned that in seeking to assign new tasks to government, President Barack Obama risks stifling the dynamism of the American economy. Business Week began a series of contributed essays building towards a special issue in August, “The Case for Optimism.” In August, too, will appear In FED We Trust: Ben Bernanke’s War on the Great Panic– a book that may propel Wall Street Journal columnist David Wessel into a Bob Woodward-like role as a chronicler of US economic policy.
I turned briefly to two books that are directly influential in disseminating the recent changes in our view of growth: The Economics of Growth, by Philippe Aghion, of Harvard University, and Peter Howitt, of Brown; and Introduction to Modern Economic Growth, by Daron Acemoglu, of the Massachusetts Institute of Technology. Both are textbooks, the former intended for advanced undergraduates or beginning graduate students, the latter for graduate students well along in their training. Both contribute substantially to the professional debate. But neither is easy reading.
The current book that comes closest to communicating a modern view of growth, I think, is The Venturesome Economy: How Innovation Sustains Prosperity in a More Connected World, by Amar Bhidé, professor of business at Columbia University., Bhidé, who is not an economist, compares his method to the evidentiary proceedings of a common law trial: he interviews experts from many disciplines, and then makes up his mind. The last author to make a substantial contribution to this literature was AnnaLee Saxenian, author of The New Argonauts: Regional Advantage in a Global Economy. Her method was frankly journalistic, but she came back with the goods. So does Bhidé.
The burden of the argument of Venturesome Economy is that that an inevitable expansion is taking place in the quantity of high-level know-how that is being developed in countries around the world – not just Japan and Korea, but India and China, Israel and Australia. If the US learns to relax and take advantage of new knowledge developed offshore, everything will be fine. But if “technonationalism” gains the upper hand – in the form of, say, a commitment to a strong US automotive industry, no matter what the cost – then a world carved into trading spheres could experience slower growth than otherwise would be the case.
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