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October 2019

Note to Self: Lessons from East Asian Development: Japanese Industrial Policy: Readings:

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And so the cruelty of U.S. immigration policy has now touched me personally. Maria Isabel Bueso is the sister of one of my daughter's friends from high school. It appears to have taken the personal intervention of at least on U.S. senator to get INS to at least reconsider whether it really wants to be pointlessly cruel. And, after watching this story unfold, I can no longer push back against those who claim that, as far as current U.S. immmigration policy is concerned, the cruelty is the point. I had been pushing back, but no more:

Farida Jhabvala Romero: Feds to Reconsider Case of Bay Area Woman Getting Lifesaving Treatment Who Faces Deportation "Maria Isabel Bueso has overcome many challenges as a result of the debilitating genetic disease she was born with that eventually left her confined to a wheelchair, breathing through a device and reliant upon weekly treatments to survive. She trained to become a dance teacher and now is an instructor, and she graduated summa cum laude from California State University, East Bay—where she set up a scholarship fund for students with disabilities. She also advocates for people with her disease and other rare illnesses, traveling to Washington, D.C., to lobby for medical research. Now, Bueso is fighting for her life once more. Immigration authorities previously told her and her family to leave the U.S. by mid-September—or face deportation to her home country of Guatemala...

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Equitable Growth Worthy Reads from October 4, 2018

stacks and stacks of books

Worthy Reads at Equitable Growth

  1. One thing making me hopeful for our future is that as our technological powers and capabilities grow, our ideas of what people need to be fully included members of society grow as well to keep pace. Just think of how high-speed computer access is becoming something that it is obvious that all Americans—and especially all American children—very much need to have. The fact that we—or some of us, at least—think that the failure of us to make sure this is provided is a "gap" is something I at least, in historical perspective, find very heartening: Delaney Crampton: Why Accessibility To High-Quality Broadband Matters To U.S. Schoolchildren: "Nearly 5 million households with school-aged children in the United States lack high-quality broadband access at home... 31.4 percent of households earning an annual income lower than $50,000 with school-aged children... 40 percent of those with annual incomes lower than $25,000...

  2. One might, naively, think that the economies of scale that companies like Wal-Mart possess should redound to the benefit of workers as well as consumers. More efficiencies from economies of scale should leave a bigger pie for everyone else, which would be shared, right? Apparently not. When a business earns more by selling to large buyers, its workers wages appear not to go up but to go down. Something to watch very closely. Sharon Nunn sends us to Nathan Wilmers: Sharon Nunn: Big Businesses Push Down Prices, and Perhaps Wages: "As large firms... command increasing market share in the retail industry, they narrow the field of buyers for companies that make and move consumer products.... [Nathan] Wilmers found that since the late 1970s... a 10% increase in [corporate] earnings that depend on larger buyers is associated with a 1.2% decline in wage growth...

  3. Heather Boushey said wise things about distributional national accounts before the U.S. Congress's Joint Economic Committee: Heather Boushey: Testimony Before the Joint Economic Committee: "The U.S. Bureau of Economic Analysis releases a new estimate of quarterly or annual GDP growth every month. Distributional national accounts would add to this release an estimate that disaggregates the topline number and tells us what growth was experienced by low-, middle-, and high-income Americans. Academics have already constructed such a measure. The so-called DINA dataset constructed by economists Thomas Piketty, Emmanuel Saez, and Gabriel Zucman...

  4. I was tremendously disappointed to find myself trapped in Berkeley and so I missed: Ellora Derenoncourt, David Grusky, Trevon Logan, and Kimberly Adams: Research on Tap: Economic mobility—The Impact of Race and Place: "Place-based disparities and structural barriers based on race shape economic outcomes...

  5. This may well be the most interesting working paper we released last month: "wages certainly matter for outcomes like sleep and happiness, but schedules in our data matter much more": Daniel Schneider and Kristen Harknett: Consequences of Routine Work Schedule Instability for Worker Health and Wellbeing: "Research... has overwhelmingly focused on the economic dimension of precarity, epitomized by low and stagnant wages. But the rise in precarious work has also involved a major shift in the temporal dimension of work such that many workers now experience routine instability in their work schedules...

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Andrew Ian Wilson: Developments in Mediterranean Shipping and Maritime Trade from 200 BC to AD 1000: "Figures 2.2–2.6 show a massive drop in shipwreck numbers between the first and second centuries AD, just when there was major investment in harbour works at Portus, and just when African Red Slip exports from North Africa take off. The pan-Mediterranean distribution of this tableware shows that maritime trade links were not declining; yet most of this evidence comes from terrestrial excavations. There is therefore something anomalous about the underwater evidence...

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Chad P. Bown: "Trump administration officials decided the best way to deal with recession risk which they of course aren’t personally worried about, was through a show of force on TV: Catherine Rampell: Move Over, Illuminati. The Conspiracy Against Trump’s Economy Is Massive: "Trump, aided by his economic brain trust of cranks and sycophants, believes any indicator showing the U.S. economy could be in trouble must be fabricated. It’s all part of an anti-Trump conspiracy, he rants, according to reports in The Post, the Associated Press and the New York Times. And move over, Illuminati, because this particular conspiracy is massive. It’s led by the Federal Reserve, Democrats and the media, of course, or so say Trump and his Fox News minions. But it also includes the entire U.S. bond market, which flashed a warning sign last week when the Treasury yield curve inverted (meaning long-term bonds had lower interest rates than short-term ones, which usually predates a downturn). Also colluding are the many farmers, retailers, manufacturers and economists who have been warning for more than a year that the burden of Trump’s tariffs is mainly borne by Americans, not China or other trading partners, and also that uncertainty over trade tensions can paralyze hiring, investment and purchasing decisions, which we need to keep the economy expanding.... The White House has reportedly declined to develop contingency plans for a downturn because it doesn’t want to validate this 'negative narrative'. This is, in a word, idiotic. As others have analogized, it’s like refusing to buy a fire extinguisher because you’re afraid of feeding a “negative narrative” that you might someday face a fire. Administration officials decided the best way to deal with recession risk, which they of course aren’t personally worried about, was through a show of force on TV.... Peter Navarro’s strategy was to deny that the data show Americans are paying higher prices on tariffed goods (though we are) and also that the yield curve had recently inverted (though it did).... Larry Kudlow... bizarrely pretended other troubling economic data (in this case, on consumer sentiment) didn’t exist.... It’s hard to imagine nervous Americans are really this credulous. Then again, perhaps we were never the intended audience for such performances. Sure, maybe White House aides are trying to fool the public into believing recession warning signs don’t exist. But maybe they’re actually just trying to fool their boss...

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I wish to once again that there is something very wrong with the New YorK Times's news judgment, and has been since at least... do we date it Judy Miller or to the start to Whitewater, or earlier?. This is a problem: Scott Lemieux: Say What You Will About Both Sides Do It, It's an Ethos "On May 1, the New York Times published a story that contained the most important facets of the Ukraine story. The Times reported that President Trump, through his personal lawyer, Rudy Giuliani, was pressing Ukraine’s government to investigate Joe Biden. And yet, having uncovered a massive scandal, the Times buried its own scoop. The revelation, which many people now see an an impeachable offense, was buried in the middle of a story that was primarily devoted to carrying Trump’s water. Headlined 'Biden Faces Conflict of Interest Questions That Are Being Promoted by Trump and Allies', the story spun out a version of the narrative Giuliani has been trying to implant in the media... [that] Joe Biden took untoward action to help his son Hunter’s business in Ukraine by demanding the firing of a prosecutor who was investigating him. The news about Trump’s role arrived only after nine paragraphs of insinuations against Biden. And then, after a brief detour that casually reveals that the Biden story is the product of an extraordinary abuse of power by the president, it returns to a long unspooling of the Biden-Ukraine narrative. Even at the the time, and especially in retrospect, it was an example of extremely bizarre journalistic judgment.... Were does the Hunter Biden story come from? Why, none other that Peter 'Clinton Cash' Schweizer. No matter how many times they come up empty these people will never stop chasing Steve Bannon’s snipe hunts...

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Michael V. White: Retrospectives: Who Said "Debauch the Currency": Keynes or Lenin?: "One frequently quoted passage from the work of John Maynard Keynes is that 'the best way to destroy the capitalist system [is] to debauch the currency." The passage, attributed to Vladimir Illyich Lenin, appears in Keynes' book The Economic Consequences of the Peace, which became an international bestseller when it was published in 1919. Economic historian Frank W. Fetter and others have expressed doubt that Keynes was really quoting Lenin because they found no such statement in Lenin's collected published writings. Fetter suggested that Keynes based his remark on stories about what the Soviets were supposed to be saying that he heard at the Paris peace conference of 1919. It is now possible to show that Keynes based his remark on a report of an interview with Lenin published by London and New York newspapers in April 1919. Keynes' discussion of inflation in the Economic Consequences can then be read as an extended commentary on the remarks attributed to Lenin in the interview. While the report of the interview was not reprinted after 1919, it will be also shown here that Lenin responded to Keynes in a speech that was reprinted in his Collected Works...

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This puzzles me: at least semi-stable schedules are relatively easy to provide for employers, and are worth a lot to workers. I do kinda wonder if these trends are the result of now two decades of slack labor markets in which workers are and employers want to remind workers that they ought to be grateful for any jobs at all: Daniel Schneider and Kristen Harknett: For Job Quality, Time Is More than Money: "What we found is striking: Working in the service sector doesn’t only mean low pay and few fringe benefits, it also means turning over the reins to your employer when it comes to when and how much you will work. This so-called 'just-in-time' scheduling approach has consequences for millions of American workers. People with unstable work schedules are markedly less happy. They sleep less well and are more likely to report feeling distressed. This pattern plays out consistently whether we look at short notice, last-minute changes or routine ups and downs in work hours. For instance, employees who worked “on-call” shifts were less likely by half to report good sleep quality than their co-workers who didn’t work on-call...

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Very Briefly Noted 2019-10-04:

  1. Raghu Rajan (2005): Has Financial Development Made the World Riskier?

  2. Federal Reserve Bank of Kansas City (2005): Discussion of: Raghu Rajan: "Has Financial Development Made the World Riskier?"

  3. Federal Reserve Bank of Kansas City: Economic Symposium Conference Proceedings

  4. Federal Reserve Bank of Kansas City (2005): The Greenspan Era: Lessons for the Future

  5. Federal Reserve Bank of Kansas City (2008): Maintaining Stability in a Changing Financial System

  6. Federal Reserve Bank of Kansas City (2009): Financial Stability and Macroeconomic Policy

  7. Federal Reserve Bank of Kansas City (2010):Macroeconomic Challenges: The Decade Ahead

  8. Christopher S. Kovacs: Fallen Books and Other Subtle Clues in Zelazny’s “A Night in the Lonesome October”

  9. Wikipedia: A Night in the Lonesome October

  10. Paul R. Krugman (1984): The U.S. Response to Foreign Industrial Targeting krugman-targeting.pdf...

  11. Paul R. Krugman (1983): Targeted Industrial Policies: Theory and Evidence

  12. Nathan Lane: Manufacturing Revolutions: Industrial Policy and Networks in South Korea

#noted #verybrieflynoted

As I have said, I have swung around to the point of view that the New York Times's bending over backwards to soft-pedal Trumps cruelty, lunacy, and mendacity is because the Sulzburgers like their tax cut. As one person said to me last week: "you have no idea how many rich old- and middle-aged men have said to me: 'Don't tell my wife, but I'm voting for Trump again'": XLProfessor: "It's really bad that @nytimes still hasn't changed their characterization of Trump's 9/11 story from "exaggerated," to "false," considering how many people have pointed out their error. They need to make a point of getting this right before the election...

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Charles Johnson: "[Trumpists] owning the libs by laughing about how openly corrupt they are Mark Knoller: 'Beginning speech to Concerned Women of America, Secretary Pompeo "this is such a beautiful hotel. The guy who owns it must gonna be successful along the way," he says, without mentioning [Trump] by name. "That was for the Washington Post," he says of his remark...

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Very Briefly Noted 2019-10-03:

  1. Josiah Ober: Rationality, interests, and Choice in Greek Thought and Practice

  2. 2019-10-02-files-from-quantecon

  3. Per Capita GNI Numbers

  4. Longest-Run Global Growth

  5. G7 Growth since 1800

  6. Lecture Support: Comparing Britain and the World

  7. Pareto's Law: 20% Get 80%

  8. 2019-01-01-shiller-data

  9. 2017-05-05 115 Review #TCEH.key

  10. 2019-09-19-GPP-115 Modernization Guest Lecture.key

  11. The Macroeconomic Situation: June 2008: The Last Financial Crisis of the Nineteenth Century

  12. Brown: Janus Inequality_

  13. 2017-04-10 Russia Sits Down

  14. Global Poverty: Challenges and Hopes in the New Millennium

  15. East Asian “Deep Roots”

  16. The U.S. Economic Outlook

  17. African Retardation

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Sparking a slave revolt as a way of undermining an opposing polis in classical Greece. Here the Spartans do it to the Athenians. Later on the Thebans would do it to the Spartans in spades. Hard to maintain that classical Athens, at least did not heavily rely on slavery: Thucydides: Harming the Athenians "Decelea was first invested by the whole enemy army in that summer and later was held by the garrisons coming from different cities coming in turn to ravage the land, it was causing great harm to the Athenians. Indeed, this undermined Athenian affairs first by loss of property and then by the death of men. Previous attacks were brief and did not keep the Athenians from deriving benefit from their land the rest of the time. But once they were continually invested in Attica and they were sometimes attacking in force and at other times using a single garrison attacking the country and pillaging to supply itself. The Spartan king Agis was also present and he was no slacker in prosecuting the war. The Athenians were greatly harmed; they were deprived of their whole land. More than twenty thousand slaves freed themselves and a great number of these were craftspeople. All of the sheep and pack animals perished. And the Athenian horses, because the cavalry was deploying every day to attack Decelea and guard the land, either went lame because of working on rocky ground or they were wounded...

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I do not understand this alternative. Tapping into global markets is great—if you have something to sell. But if low-wage labor is no longer a powerful source of potential comparative advantage, what then do poor countries have to sell that could jump-start development? There is labor, there is capital, there is expertise, there is your natural resource base. Poor counties are poor because they lack capital and expertise. And as for natural resources—well, "resource curse" is a phrase often heard for good reasons:

Michael Spence: The “Digital Revolution” of Wellbeing: "In the early stages of development... labor-intensive process-oriented manufacturing and assembly has played an indispensable role.... Advances in robotics and automation are now eroding the developing world’s traditional source of comparative advantage.... E-commerce platforms... the real prize is the global marketplace. Only if digital platforms could be extended to tap into global demand would they suggest an alternative growth model (provided that tariffs and regulatory barriers do not get in the way)...

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I do not see this as a "silver lining" at all. To say that there are now trends for factories to locate close to demand is not an alternative source of regional comparative advantage and disadvantage but rather an amplifier of other sources. Ultimately, customers are located in regions that have regional exports. A region that does not have large regional exports—and the prospect of growing more—will not be attractive to firms making long-run decisions and attempting to locate where there customers will be. It is likely to be a very uphill climb:

Rana Foroohar: The Silver Lining for Labour Markets: "The McKinsey Global Institute found that globalisation was actually bottom of the list of the top five reasons that labour’s share of national income has declined since the turn of the 21st century.... The biggest reason... supercycles in areas such as commodities and real estate have made those sectors, which favour capital over labour, a larger part of the overall economy.... Reason number two—a rise in the importance of intangible assets... Automation and the speeding up of capital substitution because of technological shifts have hurt traditional industrial areas disproportionately.... But in the future it will also radically favour a few regions... a mere 25 cities and regions could account for 60 per cent of US job growth by 2030.... Tech hubs will benefit, of course, as will commodity-rich areas and tourism centres catering to the wealthy. But so will... regions... capitalis[ing] on a silver lining.... When labour makes up less of the overall cost of producing goods and services, then offshoring jobs starts to make less sense. What does make sense is being closer to customer demand.... Companies such as Nike and Adidas have built highly automated 'speed-factories' in the US, Mexico and Germany to roll out the latest styles faster and more cheaply.... The solution: shift policy to support human capital investment.... If we continue to subsidise software without supporting people, the future looks grim.

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Ben Thompson: What Is a Tech Company?: "Note the centrality of software in all of these characteristics: (1) Software creates ecosystems. (2) Software has zero marginal costs. (3) Software improves over time. (4) Software offers infinite leverage. (5) Software enables zero transaction costs. The question of whether companies are tech companies, then, depends on how much of their business is governed by software’s unique characteristics, and how much is limited by real world factors. Consider Netflix, a company that both competes with traditional television and movie companies yet is also considered a tech company: (1) There is no real software-created ecosystem. (2) Netflix shows are delivered at zero marginal costs without the need to pay distributors (although bandwidth bills are significant). (3) Netflix’s product improves over time. (4) Netflix is able to serve the entire world because of software, giving them far more leverage than much of their competition. (5) Netflix can transact with anyone with a self-serve model. Netflix checks four of the five boxes. Airbnb, which has yet to go public, is also often thought of as a tech company, even though they deal with lodging.... Uber, meanwhile, has long been mentioned in the same breath as Airbnb, and for good reason: it checks most of the same boxes.... WeWork... is hard to see how... is a tech company in any way.... Peloton is also iffy as far these five factors go, but then again, so is Apple: software-differentiated hardware is in many respects its own category...

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Very Briefly Noted 2019-10-02:

  1. Cal Peternell: A Recipe for Cooking

  2. Harry Brighouse: Becoming a Better College Teacher (If You’re Lucky "The narrator noticed the need for improvement through teaching a new class badly, and learning that he had no reason to trust that he, or many others, were teaching other classes better...

  3. Browserling: HTML to Markdown Converter

  4. 10 1/2 Big Ideas for 20th Century Economic History

  5. The Multimillennial Perspective

  6. Joan Robinson: Open letter from a Keynesian to a Marxist

  7. Notebook: Discussion of "Communism" and Related Subjects

  8. Communism and Really Existing Socialism: A Reading List for Post-Millennials

  9. Andrew Lazarus

  10. Roger Zelazny: A Night in the Lonesome October

  11. Skulls in the Stars: October Reading: "A Night in the Lonesome October"

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Comment of the Day: Kaleberg "There's a reason David Lodge, in his Changing Places, set up Euphoric State University to contrast against the University of Rummidge, a thinly disguised University of Birmingham. Physically quite different, they were both complex mazes of bureaucracy, idiocy and academic power plays. I mainly knew UCB computer science types, mainly graduate students. They were used to pain in the ass computers, so the institution bothered them less. Besides, they all had obvious fall backs and side gigs across the bay. The humanities types I knew there called it 'Beserkely'. Becoming a small fish in a big pond is a common problem at MIT. For just about any given task that you find at the edge of your abilities, there are going to be a good number of people who find it 'intuitively obvious'. When I went to MIT there were three physics tracks for those who hadn't placed out of the course (via AP test or prior credits). Drop date was almost two months into the term, and one could easily transfer before then. MIT admits students based on grades and enthusiasm. There is almost always a number of tasks that one finds intuitively obvious but seems nearly impossible to the rest of the class...

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Very Briefly Noted 2019-10-01:

  1. Alain Naef: CV

  2. Alain Naef: Blowing against the Wind? A Narrative Approach to Central Bank Foreign Exchange Intervention

  3. Wikipedia: Deioces

  4. Wikipedia: Effective Population Size

  5. Dave Guarino: LinkedIn Apply for California Food Stamps Online |

  6. Marshall Berman: _All that is Solid Melts Into Air: The Experience of Modernity

  7. ASPE: 2019 Poverty Guidelines

  8. David Singh Grewal

  9. Possibly the worst thing written in April, 2019: Benjamin Wittes: Attorney General Bill Barr Deserves a Fair Chance "Judge the attorney general by what he ultimately sends to Congress...

  10. Amazon: Yves Cohen

  11. UC Berkeley: Interdisciplinary Studies Field

  12. Does the expansion in the money stock reflect an outward shift in the demand-for-money or in the supply-of-money schedule? That is the question that is ignored in the fruitless debate between the banking and currency schools: Wikipedia: British Currency School Wikipedia: British Banking School

  13. Charles P. Kindleberger: Manias, Panics, and Crashes

  14. Muscat Water Temperature

  15. Paul Krugman: Target Zones and Exchange Rate Dynamics "Target zone... the expectation that monetary policy will be adjusted to limit exchange rate variation affects exchange rate behavior even... inside the zone... a strong formal similarity to problems in option pricing and investment under uncertainty...

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