This is the first instalment of a weekly round-up of interesting economics and statistics, development writing and general marginalia produced by Ranil Dissanayake, blogger in absentia at Aid Thoughts and now a senior economist at the Department for International Development. It’s an entirely personal, often sarcastic, and occasionally profoundly grumpy sideways glance at the world. It is most definitively not representative of the organisation for which he works, and has evolved from occasional ranting e-mails sent to colleagues into a mailing list to the great, the good and the crushingly insignificant of the development world. Ranil has agreed to publish his links on the CSAE website, on the condition that no-one takes it too seriously, gets too offended or assumes these views represent anything but his own, rather odd, mind.
Hi all,
This week’s links may be punctuated by a shriek of joy as Joe Root orchestrates the most obscene chase in the history of English limited overs cricket. Oh, DAGUMMIT! As soon as I typed that, he holed out to Kagiso Rabada, but he’s done the hard work. I hope. He has, right? Oh god. This is what it’s like to support the English cricket team – basically a random emotion generator gone haywire. Funnily enough, that’s a pretty good place to start this week’s links…
[As an aside, this week’s links are also being published, for the first time, on Oxford’s Centre for the Study of African Economies website. I’m not going to self-censor or change my style; and I’m certainly not going to stop sending this out as an e-mail.]
1. Reading Tim Harford’s blog this week was a little like watching a very high-functioning and extremely economically literate tantrum unfold piece by piece. It started with Tim in optimistic mood – outlining the opportunity the most recent UK budget had to inject some consistency and sanity into the mish-mash of random nudges and incentives that constitutes the UK’s tax structure. He then got annoyed when the actual budget didn’t live up to its promise by taking exactly the kind of fudge he warned against on the sugar tax (funnily enough – fudge would not be taxed under the actual ‘sugar tax’). And then he took a moment, and exploded into a full-blown tantrum, deciding that we don’t need a budget anyway. He’s correct, of course, but it’s never going to happen. Still, it was great fun to watch. [And England just won! But not before trying to give me a heart attack.]
2. Duncan Green reports on the tentative re-emergence of industrial policy as an approach to economic development, summarising some rather different thoughts from Ha-Joon Chang and Mushtaq Khan. I’m basically sympathetic to this agenda, but with a big caveat: we know this can work brilliantly, and we know it can fail spectacularly. What we don’t really know is what the right amount/type of support is in places that fall short of the ideal political context for rapid development – or even how we tell how far from ideal they are. I’m willing to be convinced, but I need a bit more than anyone out there is giving. And if anyone mentions malarial zones 200 years ago or settler mortality, I’m going to scream. Sort of related: a new working paper from Karthik Muralidharan, Jishnu Das and colleagues on the fiscal cost of poor governance –looking at teacher absence in India.
3. On poverty, but in a different context – Tyler Cowen reports on a new paper that suggests that the poor should probably be moving around a bit more to find better prospects for increasing their incomes, concluding: “Ultimately we wish to protect people, not places per se.” I couldn’t agree more, and by the way, would it be awkward if I pointed at the large boat-shaped elephant in the room, filled with poor people looking for exactly that?
4. Ben Casselman at FiveThirtyEight illustrates one of the points I get very boring about: countries or firms don’t outsource or attract jobs, per se. They attract or outsource production, and this distinction has huge policy relevance. If you care about unemployment intrinsically or for inequality reasons (and I strongly feel you probably should), then doing things that make labour an attractive part of a production function is pretty important. Note – some people think I’m saying we should make capital more expensive. No. Poor countries need way more investment. However the choice of technology we embody through investment can be influenced. [And because Trump-face appears on that blog, here’s a reason to believe].
5. Speaking of technology, yet another 538 link – a really good discussion of the AlphaGo overreaction here. Here’s the thing: Go is so complex that people aren’t very good at it, compared to any objective scale at which 10 is ‘can solve the game’. That means much of the human competition comes from very human soft-skills – reading the intentions of your opponent from his moves and expressions, psyching them out with aggressive opening gambits, learning about them – sometimes over the course of months. You can’t do any of that with a computer, so all it needs are slightly better heuristics on an objective level than a human to beat them most times. In a way, this is less impressive than Deep Blue beating Kasparov. That said, Andy Haldane is a bit more worried, so maybe I should be too. Can they make a robot that loves cricket and economics?
6. Brilliant article about Mervyn King and central banking. I worry that finance is so different today than it was when most currently rich countries developed that this is just a fundamentally more difficult world for a firm in a poor country to ever get long term finance.
7. Finally, I love the RPI updates. People are so gloriously weird: apparently there are people who eat ‘microwave rice’, which has my tastebuds recoiling in horror; and the stack of writeable CDs I found while moving house are now basically useless. Dammit.
Have a great weekend, everyone!
R
