Posts tagged…Microeconomics
Return of industrial policy
Tue, Apr 13 2010Dani Rodrik is happy about it.
"Today the US federal government is the world’s biggest venture capitalist by far. According to The Wall Street Journal, the US Department of Energy (DOE) alone is planning to spend more than $40 billion in loans and grants to encourage private firms to develop green technologies, such as electric cars, new batteries, wind turbines, and solar panels. During the…
Read more…Razzing the Congress party
Thu, Apr 16 2009"[The Indian election] exposes the do-nothing, zero-reform record of Manmohan Singh, prime minister, and his government. More generally, it lays bare India’s huge reform gaps and its brittle, decaying institutions. Finally, it deflates the ‘India hype’ peddled by smooth-talking upper-caste politicians, ambassadors, businessmen, management consultants and some academics"
Extract from an Op Ed by…
Micro-macro
Sun, Apr 12 2009Tim Harford—discussing the dissing of macro—quotes P J O'Rouke:
"[M]icroeconomics concerns things that economists are specifically wrong about, while macroeconomics concerns things that they are wrong about generally" Extract from Tim Harford in the Financial Times
Public Policy and the Payments System
Thu, Mar 26 2009An important speech last night by the Reserve Bank governor Glenn Stevens arguing the need for more intervention in the private payments system—specifically the EFTPOS and ATM systems—to guide and accelerate the development of better technologies and standards by the competing Australian banks.
Stevens devotes much of his speech to a fascinating analysis of classic market failure due to…
Bailouts could stifle recovery
Wed, Jan 28 2009The problem is well-expressed by Barry Ferguson writing in The Age (of all places):
"Now is the time when companies with unsustainable business models, with outdated product ranges, too much debt, inadequate boards and management, and poor corporate governance, will be exposed. It is a time when legendary economist Joseph Schumpeter's gales of creative destruction do their best work.
The primary…
Automobile tariff cut irrelevant
Tue, Sep 16 2008
Why it's impossible to get too excited about the planned cut in automobile tariffs from 10% to 5% in 2010. Despite the howls of capital and the unions, the volatility of the Australian exchange rate makes a 5% margin irrelevant. Already in 2008 the trade-weighted index has fallen more than 7 percent. Click the thumbnail for a larger image.
Glimpses of a micro reform program
Sun, Aug 10 2008Paul Keating has a world-beating talent to sting. His descriptions of his successor as Prime Minister, John Howard, as a "dessicated coconut araldited to the seat" while his deputy Costello was "all tip and no iceberg", are exemplars of the jibe. But they're spitballs not barbs. They don't wound because they're often more-than-half boastful: in this case, a reminder that Keating finally crushed…
Easterly vs the Growth Commission
Mon, Jun 02 2008The Growth Commission report has been described by David Warsh as an orphan of the World Bank's former regime (under Wolfowitz). Now Bill Easterly claims its reductionist expertism—abandoning all grand theories of development—is also an empty promise. There is at least one general principle that can be discerned in every case of successful development:
"Confirming Hayek, systems that give more…
Democrat trade policies would hurt low-income Americans
Thu, May 22 2008James Surowiecki makes a plausible case in a straightforward way. Although it's difficult even for Paul Krugman to find solid evidence that trade with China, for example, has cut wages, it's apparent that the deflation of consumer prices has helped average- and low-income Americans most.
"Obama and Clinton, in their desire to help working Americans—and gain their votes—are pushing for policies…
Does trade with China help the poor?
Sun, Apr 27 2008One focus of the economic debate (if that's what it is) in the battle for the Democrat nomination in the United States seems to be on the impact of trade—read: China—on jobs for the low-income group. But that's only one side of the story. The other side is pretty interesting, too.
We examine the role played by Chinese exports in explaining the lower inflation of the poor. Since Chinese exports…
Australia’s export performance—should we be worried?
Sat, Apr 19 2008
The Australian government's Review of Export Policies and Programs has apparently been prompted by concerns about export performance.
"While exports exhibited strong growth in the period 1980-2001, reflecting technological changes and important domestic policy initiatives such as the lowering of tariff barriers and the introduction of pro-competition policies, in recent years there has been a…
Obama: don’t tread on me
Mon, Feb 25 2008We can't keep passing unfair trade deals like NAFTA that put special interests over workers' interests (Barack Obama, emphasis added)
Obama's not going to let Mexico or Canada swindle the USA into greater specialization (or wealth) in the North American industrial landscape! He has a plan for preventing change as well as ... um, the other one
I didn't just start criticizing unfair trade deals…