Book Review: The Rational Optimist

A few weeks ago I wrote an initial reaction to Matt Ridley’s The Rational Optimist.  Ridley’s thesis is that the key to prosperity lies in economic growth, and that economic growth is caused primarily by innovation fueled by the exchange and mating of ideas.  As long as ideas are allowed to move freely they will inevitably mate, mutate, [...]

Revolving Doors, Lobbyist Edition

Via Marginal Revolution, an interesting new paper that explores what happens to an ex-staffer’s lobbying revenue when the politician they worked for leaves office. Our main finding is that lobbyists connected to US Senators suff er an average 24% drop in generated revenue when their previous employer leaves the Senate. The decrease in revenue is out [...]

To explain the origin of exchange, you must explain the origin of trust

I’ve just started reading Matt Ridley’s The Rational Optimist.  So far, it is an excellent, through-provoking read.  A key to Ridley’s argument is that the innovation of exchange–the trading between two parties of separate items or services that both parties value–that led to mankind’s dominance of the planet and the explosion of knowledge and technology. [...]

Economists Do It With Models

For those interested in the smart and witty discussion of economics (behavioral and otherwise) do yourself a favor and check out Jodi Begg’s Economists Do It With Models (the title says it all). Beggs is a Ph.D. Candidate at Harvard and focuses on behavioral economics (incentives, generally).  She has a great sense of humor and [...]

It’s Time to Bring a Moneyball Approach to the Credit Rating Industry

Probably the least discussed aspect of the recent market crash is the role played by the credit rating agencies (CRA’s).  While some on Wall Street were hard at work creating exotic bonds and investment products that included bundles of toxic, subprime mortgage loans, the CRA’s were providing the necessary cover for these instruments to be [...]

The Credit Crunch Prophet

This weekend’s Financial Times featured a great interview with economist, and ‘prophet’ of the recent economic metldown, Nouriel Roubini. At a time when many economists and financial commentators where underplaying, if not downright ignoring, the looming credit crunch, Roubini was warning of the impending chaos of the markets.  Some may claim that he was simply [...]

Analytical Shortcuts: Knowing “What” Instead of “Why”

Correlation doesn’t always equal causation, but often correlation can serve as a signal.  The collection and analysis of data in some areas of the world is messy and slow.  Often times this means the data can only tells us what happened in the past.  What we would ideally like is a snapshot of events and [...]

My senior thesis gets less impressive by the day…

I wrote my senior honors thesis back in 2000 on the interplay between transnational organized crime, corruption, and privatization in the former Soviet Union.  At the time I thought is was pretty good, impressive in fact.  Well, I’ve learned through the years that, in the words of Nero in Mel Brooks’ History of the World, [...]

Seeing the whole board on financial reform

Clive Crook does: The problem is not just that specific rules – higher bank capital requirements, for instance – threaten profits and are therefore opposed. It is that all governments see themselves as partners of their industries in world competition. Regulators seek not a level playing field but one tilted to their own groups’ advantage. [...]

Book Review: The Bottom Billion

I was familiar with Collier’s work and those that he takes on (Bill Easterly, Jeffrey Sacks) for some time before finally picking up this highly acclaimed book. It didn’t disappoint. The Bottom Billion is an accessible summary of Collier’s work which focuses on the peculiar problem of development for the poorest countries in the world.  [...]

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