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Alex Fox
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Eichengreen and Mody come to a conclusion that has been common in many of our discussions on development economics and science in general. Their is no one model that can explain or accurately project the effect that US/developed economies interest rates have on global financial markets, specifically lending to LDCs. But, that doesn't mean that low interest rates doesn't translate to increased lending to developing countries. It just means that both sides of the equation must be looked at, which in this case is international lenders' willingness to lend as well as borrowers' decision to supply the obligations. Both sides must be taken into account as one side may carry more weight in different regions. In this context, it can help explain the difference in circumstances in Latin America and Asia. In sum, it is another problem of many factors that can be modeled to a certain extent as long as one understands that not all factors can be taken into account. Once again you can give a estimate as to what "might" happen.
Toggle Commented Nov 19, 2015 on ECON 280 for Thursday at Jolly Green General
Discussion on global climate change and its impacts is always a frustrating topic to broach. This report is one of many, on varying scales of alarm, that paint a very bleak future in the face of inaction. It feels like the course of action is so clear. But, I can't pretend like I know what what the far-reaching implications of an initiative towards combatting global climate change actually are. However, it seems that many world economies have this narrow mindset in which they're content with economic growth in the short term, while any potential future effects of climate change cause tunnel vision. In the end, everyone has their best interest at heart and that will always be a barrier to action. I'm sure many people, many corporations, stand something to lose as the result of comprehensive policy combatting climate change. But so, so many more people face a troublesome future. Economies that rely heavily on traditional agrarian practices could collapse before they even have a chance to think about an economic policy that will improve productivity or help it transition. No economy is really buffered from the effects of a world that is 4 degrees Celsius warmer. I wish that were enough to get people to actually do something about it. But, hard to get things done when there are still people who refute overwhelming scientific proof.
Toggle Commented Nov 12, 2015 on ECON 280 for next Thursday at Jolly Green General
I thoroughly enjoyed the delivery of the Schultz's "Economics of Being Poor". Would have been interesting to hear the lecture in person. He spends a good deal of the lecture calling out the mistakes of his peers, particularly the lack of investment in human capital in the rural, agricultural sector. This had we wondering how it ties into the idea of "urban-bias" associated with the Lewis two sector model. It seems that Shultz would called for investment towards improving the efficiency of the agricultural sector instead of siphoning away the labor. More capital is poured into the urban industrial sector, at the cost the agricultural sector. Investment in industry keeps grain prices low, at the expense of farmers. Aside from this, engraining the idea that the quality of people is of utmost importance really serves to put an emotional spin on the argument. It isn't just about improving efficiency and productivity in a neglected agricultural industry, it's about helping to alleviate the poverty that has come to be so closely associated it. Behind the production of the world's food is a person, little different than us, who isn't adequately equipped with the knowledge and skills to make the most of his livelihood.
Toggle Commented Nov 5, 2015 on econ 280 for Thursday at Jolly Green General
Rodrik's discussion initially came off as some sort of a cop-out, or as a defense for broad economic growth strategies. From the onset, the point didn't seem that insightful, of course there is no magic universal economic growth strategy. However, as Rodrik picks apart different case studies, various success stories of growth (i.e South Korea, Taiwan, China, India) and draws lines between them all, insight is drawn. Ultimately, we arrive at a conclusion that has come up often in our class. Economic growth principles are made ceteris paribus, but can never be applied in a vacuum. Therefore, the pieces that constitute these policies may lead to success in growth, but it is up to policy makers to adequately judge the environments in which they are being implemented. From there, it remains true that economic growth is rooted in these standard economic principles, but requires ingenuity, and creativity in policy making to be fruitful and sustainable.
Krugman's paper deals partly with the discussion of the evolution of thought and methodology, and the ability of science and mathematics to evolve in step with this thought. The proof, in the case of high development theory, was a step behind. Going back to our discussion on Tuesday on "The Science of Compassion" and the work of Dr. James Doty in cognitive neuroscience I think brings up an interesting point to this discussion. As economic thought continues to evolve and establish connections in developing areas such as neuroscience, how is it being received? Is this just a recycling of intellectual understanding of economics, another step in the cycle in which accurate theory precedes concrete proof? Or will it be different, as different science is used to explain our thoughts and actions, concepts may once again prove difficult to validate using models. Will economic theory always be tied to the substantive proof of modeling, even as we delve into areas of science that might seem more abstract?
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Sep 16, 2015