Thinking Fast and Slow
Decision Making, Finance, Medicine, Political Economy
A simple maths problem: If a bat and a ball cost $1.10 and the bat is $1.00 more expensive than the ball, how much does the ball cost? Half a Harvard class got the wrong answer in a written test!!!
Economics Nobel Prize winning psychologist Daniel Kahneman argues that we have two systems of thinking. System-1 is intuitive and fast while System-2 is logical, slow and lazy. Continue reading...
Capital in the Twenty-First Century
Distribution of Income and Wealth; Economic Growth, Debt, Globalisation, Inflation, Tax
Capital in the Twenty-First Century documents and analyses changes in the distribution of wealth and income in developed economies from the mid 19th century. There are some who claim it to be the update of Marx’s Das Kapital – albeit arguing for radical reform and not revolution and dictatorship. Heavy going for non-economists despite a friendly narrative style with lucid explanations of the simple mathematics. Continue reading...
Capitalism, Socialism and Democracy in the Twenty-First Century
Political Economy, International Relations, Democracy, Asian Development, Australia, Inequality, Economic Growth
A careful thoughtful view delivered at the LSE in October 2014 of the “big” issues from one of Australia’s most eminent economists. The title borrows from one of the great political economy tomes of the 20th century, written by Joseph Schumpeter (1883-1950). Garnaut refers to many of the the most important political philosophers and social thinkers of the 20th century as he examines the big picture issues through the lens of the nations he knows best – Australia, China (where he was at one time Australian ambassador), Indonesia and Papua New Guinea. Continue reading...
Why Are We Waiting? The Logic, Urgency and Promise of Tackling Climate Change
Political Economy, Climate Change, Economic Development and Growth, Ethics
Introducing his new book, Why Are We Waiting? The Logic, Urgency and Promise of Tackling Climate Change Professor Stern outlines why the transition to a low-carbon economy and rapid structural transformations to the world economy provide a story of growth and poverty reduction that is attractive and sustainable.
Stern is the author of the Stern Review – the most comprehensive and authoritative report on climate change from an Economics perspective. Continue reading...
Debt, Demographics and the Distribution of Income: new challenges for monetary policy
Monetary Policy, Interest Rates, Macroeconomics
Monetary policies all over the world are such that interest rates are at their lowest rate ever. In some economies, the rate is negative so that it costs to keep money in banks rather than “under the bed”. This is unprecedented! Despite this, borrowing for new investment is weak – with implications on future productivity and economic growth.
The low interest rates mean that there is little scope to reduce them further, which in turn means that monetary authorities have little scope for managing economic activity – employment, production and investment. Continue reading...
When Firms Become Persons and Person Become Firms
Constitutional Law, USA, Politics
In the United States, the extension of civil liberties to corporations is transforming democracy through rights adjudication. Best known in this regard is Citizens United v. The Federal Election Commission, the 2010 Supreme Court decision permitting corporate funding to flood the U.S. electoral process on the basis of corporate rights to free speech. In 2014, Burwell vs Hobby Lobby granted firms the right to the free exercise of religion, and hence the ability to withhold insurance coverage of abortions and abortifacients for their employees. Continue reading...
Contracts, Firms and the Boss-Worker Relationship
Economics, Law, Contracts, Organisations, Employment
When is privatisation of services reasonable and when is it unreasonable? Why are there firms – rather than millions of independent contractors who trade goods and services markets? How does the impossibility of a complete contract affect productivity and production methods and efficient ownership? If firms exist because of organisational efficiencies, why isn’t there just one big relatively benevolent productive firm? Continue reading...