Bleg: Is this due to capitalism?

I hear this sort of thing a lot – and want to hear your views.  I will give a view in the future.

Also we used to just play Sim City 2000 in economics class at high school and I thought it would be cool if the individuals in the city followed rules – something they talked about for the latest Sim City but didn’t really do.  So remember any model we build to explain this is sort of like that, just maybe less entertaining with a dearth of colourful sounds.

10 years after Lehman

I have been enjoying the live tweeting of the Lehman Brothers failure – with a 10 year delay.

On the day I had this to say.

Then 10 years ago today I tried to provide some predictions.  The terms of trade fell a little more than I expected (to their 2005 levels rather than to their 2007 level), but otherwise they weren’t that bad – credit rationing was predominantly in the construction sector, mortgage rates fell, and in NZ the crisis was nothing like the Great Depression.  But this:

As long as the information transfer between market participants begins to improve again this crisis will be a historical point of interest in a years time – rather than the beginning of the end.

Glad I conditioned it on the idea that there were be a recognition of loss between debtors and creditors – because once that didn’t happen in Europe the crisis just kept on trucking.  With everything calming down by mid-2009 the world was recovering.  Then Greece in May 2010.  Then my goodness just look at this this cluster.  Finally in 2012 there was a recognition of the need for a lender of last resort in Europe.

If you want a retrospective I did one back in 2014 😉

On school spending and teachers pay

Interesting.  Education, and schooling attainment, seems to be a big issue over here in NZ as well – with a political consensus that we care about this issue, but conflict about “how” school quality relates to this (or is even measured).  So lets have a chat.

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“Left Youtube” is overusing the labour theory of value

While I have been MIA over the last four years a lot has changed on the internet and in terms of economic and social discourse.  The weird infatuation of the alt-right with “globalists” and nonsensical economic arguments is particularly upsetting – and I’ll be discussing how the decline in persuasiveness of economists has helped these types of people fill the void in the future.

My concern four years ago was that the non-rationalist identity politics of the left would open this type of negative nationalistic politics on the right – or would at least be used as a foil for it.  The refusal to actually state our assumptions and values is a failure irrespective of the intentions we hold.  In that way, when exploring Youtube I’ve been pleasantly surprised by the leftist video blogs – and their willingness to fully articulate their views.  Key examples of this are Shaun, Contrapoints, and Philosophy Tube.

However, these channels are distinctly “anti-capitalist” in terms of wanting sizable change in the status quo.  I am a mainstream economist that believes in incremental change.  A full discussion of this would be interesting – but give me time.  But to do so we need to get something clear about the labour theory of value that I am hearing them describe – it doesn’t make sense as a justification for anything let alone as a “theory of value”.

Note: The actual labour theory of value has been defined many ways – and the most profitable Marxian interpretation I’ve seen is trying to understand LTV as part of a subsistance wage argument on factor income shares.  That isn’t the focus here.

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Wellbeing conference

Via Motu on Facebook I saw the following.

I had no idea this was going on … even though I saw the flyers all around university advertising it.  I’m working quite long days at the moment so my mind isn’t really all there 😛

However, this looks cool – I’m going to see if I can find some of the related literature and write about it at some point.  I really enjoyed the summary piece by Arthur Grimes in that link, so go take a look at that!  So much to unpack in that, so I’ll leave it for another time 😉

Geoff Simmons, Politics and “career suicide for an economist”

Disclaimer:  I used to work in the same space as Geoff, and I know him as a guy who is genuine, wants to improve social outcomes, is a mad good communicator, and who works hard on the issues.  But none of this would prevent me from disagreeing with him if I did (such as my comments on food here and here and here and here), so I swear there is no bias involved 😉

In a cool interview over at interest.co.nz Geoff Simmons outlines what is going on with the TOP party, which he has just become leader of.  For the sake of clarity I think he’ll be an excellent leader for this party.  What I want to concentrate on is this quote though:

How can the public know I am serious about the long haul? When Cortez took on the Aztecs, he trashed his ships to make sure his men had no choice but to fight with everything they had. The reason I bring up that story is what I am doing right now is pretty much career suicide for an economist. There’s no going back.

Haha, this is good – I like the nifty description of a commitment mechanism.  But I’d like to ask a couple of questions about it.

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