This is Riley Stout's Typepad Profile.
Join Typepad and start following Riley Stout's activity
Join Now!
Already a member? Sign In
Riley Stout
Recent Activity
The Eichengreeen and Mody paper illustrates the relationship between interest rates in industrial countries and capital flows to developing countries. For years, it was assumed that as interest rates in industrial countries increased, such as the United States, capital flows to countries would decrease. However, this article’s empirical evidence displays that this assumption is not necessarily true. It’s interesting to see that for years people assumed that there were not any other major factors to this assumption. I found it interesting that a basic model of economics explained how the empirical evidence didn’t support the negative relationship between interest rates of industrial countries and capital flows to developing countries. The demand for cash flow by borrowers in developing countries was the concept that this assumption failed to take into consideration. A common theme that has been presented in numerous papers we have read over the term indicates that the people of developing countries do not always accept policies implemented by developed countries. This could be attributed to the fact some people think these policies cause even more hardships in the short term with no guarantee of success in the long term. Cultural difference may also provide differences of opinion on certain policies. The role of women can also play a role where policies are attempting to help women; however, their husbands might prevent them from participating.
Toggle Commented Nov 18, 2015 on ECON 280 for Thursday at Jolly Green General
This executive summary provided by the World Bank gives an excellent oversight on how developed and developing countries could be affected by global warming. The one thing that really jumped out at me when I read this article was the fact that 2-4 degree temperature change isn’t that large; however, when it comes to the earth’s temperature over a century it’s an enormous deal regarding agriculture, carbon emissions, and sea level changes. The countries to suffer the most initially would be the developing countries which would be tough on them since they don’t have the economy or technology to adapt to these issues. I understand the paper briefly discusses solutions to some of the problems that are present; however, I am interested in the specific solutions. For example, do governments of developed countries have any new technologies on the way to help reduce global warming? Or are these governments coming up with more reduction policies rather than innovations and inventions? In today’s world it’s easy to place thermometers in different regions of the world to measure the Earth’s temperature. I thought it was very interesting to see certain methods to determine Earth’s temperature in different regions thousands of years ago by the thickness of rings on tree trunks.
Toggle Commented Nov 11, 2015 on ECON 280 for next Thursday at Jolly Green General
The Sachs and Malaney paper on economic and social burden of malaria is very interesting. It’s hard to imagine the dilemma of malaria in the United States since this problem has been solved and climate is drastically different than the tropics where malaria is heavily concentrated. With modern technology and modern medicine, I was amazed to see that there are still about 500 million clinical cases every year and about 2,000 children die daily from malaria. This can help explain why developing countries located in tropic regions produce so many children due to the fear that some of them may perish from malaria. This concept spills over with what we discussed in class on Tuesday on how developed countries don’t truly understand choices that poor people make in developing countries. “The Econoimcs of Being Poor” paper also mentions the idea that wealthy people don’t understand the behavior of poor people, and this type of discussion does not exclude economists either. I feel this concept only complicates the process and/or transformation of a developing country into a developed country. Since most of the time, economists from wealthy countries are the ones attempting to come up with models to help initiate economic growth and development in these poor countries. Another point that is mentioned in this paper that I thought was interesting was that land is overrated. It was discussed that in different regions throughout poor countries, people are not any better off if they have good farming land compared to people who live on non-fertile land. Also, discussed in class on Tuesday, that the quality of the labor force is more important than the land, and it’s still underrated in today’s world.
Toggle Commented Nov 4, 2015 on econ 280 for Thursday at Jolly Green General
One of the most interesting remarks in my opinion of Rodrik’s paper involved Richard Feynman, a physicist who won the Nobel Prize in 1965. Feynman stated, “It’s the things that nobody knows anything about that we can discuss.” This quote was almost an epiphany for me in which I strongly agree with Feynman. He goes on to list several different topics that people talk about amongst themselves. This isn’t just true for economic development or economics in general but applies to almost every topic imaginable. It’s fascinating to see from the numerous articles we have read regarding development economics include principles and/or theories that can be applied to almost any discipline. Regarding development economics, it’s interesting that there are many models and/or theories to help understand how to transform developing countries into developed countries. However, one model does not work for all developing countries. For example, the way China became a developed country hasn’t really panned out for countries in areas such as Latin America and Africa. Therefore, it can be somewhat concluded that no one model can really predict and/or explain how to transform developing countries into developed countries. This area of economics still has a lot of discussion regarding how to achieve this goal of becoming developed, so it could be said that no one really knows the answer to the issue at hand.
This article did an excellent job of conveying how poor people spend, receive, and save their money. One would assume that families that are considered poor would spend most of their money on essentials such as food. The article indicates that among the 13 countries within the study the average person living at under $1 per day spends about 50-75% of their money on food. In some of the countries, this percentage is right at 50% which is astonishing. Alcohol and tobacco account for 5-10% of extremely poor people’s budget which seems unnecessary, but these people might need these consumables to cope with their everyday life which might make these consumables necessary. Also, I didn’t realize that poor people in some of these countries spend a portion of their budget on festivals which appears extremely wasteful. I thought it was interesting that most of these extremely poor people want to save money; however, they have no means to do so. Storing it underneath a mattress or in a pillow case is not sufficient enough to protect their savings; therefore, they feel the need to spend their money right away on something useful. In the short term, this idea can be justified, but in the long term this just keeps them in a state of poverty. Other factors in these poor countries for them to remain in poverty are inadequate investments in education and health. The non-existence of specialized labor and poor health combined with no savings just keep these people in poverty. If health was eliminated as a concern from these people’s lives, I think that this would help alleviate all other concerns and maybe one day end poverty for many of these people.
This paper clearly demonstrates that mathematical models for economic analyses are useful, but do not always explain the entire situation and may leave some important details out. Krugman states that any model of a system has “some degree of falsification: it leaves out some aspects of reality,” and they are many examples of models presented in this paper that are not directly related to economic models. Krugman uses examples about the mapping of Africa and a dish pan filled with water to simulate global weather patterns. Both of these examples included assumptions that simplified each model, however, these assumptions left out factors that clearly affect the final result and/or outcome. These two models are then compared to most economic models between 1820 and 1970 which were perfectly competitive markets. It was very interesting to see two different models getting compared to perfectly competitive markets in economics. Krugman also writes that losing knowledge before it is regained “seems to be an inevitable part of formal model-building,” and this is idea can be applied to essentially every model in any discipline.
Riley Stout is now following The Typepad Team
Sep 15, 2015