"I think the assumption that people are rational is the biggest weakness of economics. Without it economics wouldn't really function, with it human society wouldn't."
http://cafesalemba.blogspot.com/2006/10/econ101-preference.html#comments
(Want to keep this comment somewhere where I can keep an eye on it... -- rationality is also it's biggest strength though...)
Thursday, October 26, 2006
Monday, October 16, 2006
Monday, October 09, 2006
I learnt a New Word
It's not all that exciting, it's Indonesian, "pembantu".
Translated it apparently means "nacker", "chav", "Prolle" or "white trash" (-- wow, I now know that word in multiple dialects and languages ;).
I remember there was a wave of websites and people pointing out chavs in England, and now expat's blogs in RI are going on about "pembantu".
I know where it comes from, fair enough, but basically it's bullshit.
Pembantu / chavs / fiddy cents of this world are a million times more interesting than the average Ikea loving, fake Abercrombie and Fitch wearing, Mac computing people that love themselves.
Translated it apparently means "nacker", "chav", "Prolle" or "white trash" (-- wow, I now know that word in multiple dialects and languages ;).
I remember there was a wave of websites and people pointing out chavs in England, and now expat's blogs in RI are going on about "pembantu".
I know where it comes from, fair enough, but basically it's bullshit.
Pembantu / chavs / fiddy cents of this world are a million times more interesting than the average Ikea loving, fake Abercrombie and Fitch wearing, Mac computing people that love themselves.
Sunday, October 08, 2006
"There is no God but Allah and Mohammed is his Messenger."
"There is no God but Allah and Mohammed is his Messenger."
I realise Saudi Arabia is an extreme in the Islamic world, and I realise the the media have an interest in uncovering the most vile parts of any society (reporters thrive on bad news) but all in all it sounds like some sort of hell.
Indonesia more has a liberal take(s) on Islam derived from different cultures in the archipelago. By all accounts there have been moves towards more conservatism in Islam in Indonesia. Questions:
1) Is Saudi /the/ role model for ultraconservatives?
2) Do Saudis live more virtuous lives than Indonesians?
3) Isn't fundamentalist Islam itself wrapped up in Bedouin culture? -- just as fundamentalist American Christianity is too wrapped up in American white heterosexual culture...
I realise Saudi Arabia is an extreme in the Islamic world, and I realise the the media have an interest in uncovering the most vile parts of any society (reporters thrive on bad news) but all in all it sounds like some sort of hell.
Indonesia more has a liberal take(s) on Islam derived from different cultures in the archipelago. By all accounts there have been moves towards more conservatism in Islam in Indonesia. Questions:
1) Is Saudi /the/ role model for ultraconservatives?
2) Do Saudis live more virtuous lives than Indonesians?
3) Isn't fundamentalist Islam itself wrapped up in Bedouin culture? -- just as fundamentalist American Christianity is too wrapped up in American white heterosexual culture...
Friday, October 06, 2006
Sunday, October 01, 2006
Richard Dawkins: The Root of All Evil Part 2
| Maybe I am an atheist afterall. Always believed I just lacked faith, but that probably means I am an atheist... | |
Richard Dawkins - The Root of All Evil - Part 1.avi
| Thoughtful piece about religion and why atheism may not be so bad... | |
Evil
I don't believe evil exists.
Once you call something evil, you have admitted that you don't understand it.
The word Nazi is synonymous to evil for most.
Al-Qaeda are on the same level for many westerners.
Communists for many Indonesians.
Japanese soldiers (1930s-40s) for many Chinese.
Americans.
The English establishment - many Irish during the 70s.
The list goes on.
When you label a group "evil" you believe they are pretty much motiveless in their wrongdoing and therefore unable to change. You don't believe they are fully human anymore. The response is often to wipe them out immediately rather than understanding their incentives and motives.
A response based on understanding may be more effective.
Fighting evil can justify almost anything. It's been used by autocrats down through the ages.
It hasn't fallen out of use however. ("Axis of evil" anyone?) Islamic terrorism and America are the world's ultimate evils nowadays, depending whose side you're on. People fear it. Politicians justify their increased power by it.
-------------------
Germany I think has gotten to grips with its past better than most if not all other nations. Most Germans believe that Nazism was evil, I suspect most would profess not to understand it or fathom it.
Admittance of ignorance is at least an honest response, but then you hear of German politicians condemning far right politicians being elected, and ignoring them as if they are "evil". Shouldn't they rather ask themselves how desperate the electorate must be, how they are completely failing their electorate.
I've taught students in towns with high NDP (far right) support in East Germany. The students were some of the most generous people I have had the pleasure to meet. But people in those towns are in a desperate situation (1 in 3 unemployed -- with mass emigration from their towns). The usual politicians are letting them down, many of the most desperate have little other option but to vote for the far right.
-------------------------
The far right are not evil. Terrorists are not evil. Racists are not Evil. Religious fundamentalists are not evil.
They can be friendly, humorous, honourable and intelligent.
Many of their means and ends are not good. They are misguided. They need to be confronted. The arguments and battles still need to be won -- but we must understand them and treat them with the respect all humans deserve.
Once you call something evil, you have admitted that you don't understand it.
The word Nazi is synonymous to evil for most.
Al-Qaeda are on the same level for many westerners.
Communists for many Indonesians.
Japanese soldiers (1930s-40s) for many Chinese.
Americans.
The English establishment - many Irish during the 70s.
The list goes on.
When you label a group "evil" you believe they are pretty much motiveless in their wrongdoing and therefore unable to change. You don't believe they are fully human anymore. The response is often to wipe them out immediately rather than understanding their incentives and motives.
A response based on understanding may be more effective.
Fighting evil can justify almost anything. It's been used by autocrats down through the ages.
It hasn't fallen out of use however. ("Axis of evil" anyone?) Islamic terrorism and America are the world's ultimate evils nowadays, depending whose side you're on. People fear it. Politicians justify their increased power by it.
-------------------
Germany I think has gotten to grips with its past better than most if not all other nations. Most Germans believe that Nazism was evil, I suspect most would profess not to understand it or fathom it.
Admittance of ignorance is at least an honest response, but then you hear of German politicians condemning far right politicians being elected, and ignoring them as if they are "evil". Shouldn't they rather ask themselves how desperate the electorate must be, how they are completely failing their electorate.
I've taught students in towns with high NDP (far right) support in East Germany. The students were some of the most generous people I have had the pleasure to meet. But people in those towns are in a desperate situation (1 in 3 unemployed -- with mass emigration from their towns). The usual politicians are letting them down, many of the most desperate have little other option but to vote for the far right.
-------------------------
The far right are not evil. Terrorists are not evil. Racists are not Evil. Religious fundamentalists are not evil.
They can be friendly, humorous, honourable and intelligent.
Many of their means and ends are not good. They are misguided. They need to be confronted. The arguments and battles still need to be won -- but we must understand them and treat them with the respect all humans deserve.
Saturday, September 30, 2006
Favourite Songs
Strong list - but not an all time greatest list :) :)
This is a better list - almost 2 years of data compared to 6 months...
My Favourite Groups -- Amarok
Amarok tells me these are my favourites artists - the list is a bit mixed up - but who am I to disagree with the almighty Amarok!
Again LastFM has more data on me. But have to say the Amarok top groups is more interesting :)
"Concept of counterfeiting revisited"
(In response to: http://thejakartapost.com/detaileditorial.asp?fileid=20060930.F04&irec=3)
Von: John Orford
An: editorial@thejakartapost.com
Datum: Heute 14:38:30
Dear Sir / Madam,
The "Concept of counterfeiting revisited" (30th Sept.) article entirely missed the point.
Indonesia has higher priorities than protecting the intellectual property rights and revenue streams of Messrs. Schwarzenegger and Chan, and rightly so.
The point however, is that the counterfeit goods industry breeds industrial scale corruption and organised crime.
Every Rupiah spent on pirated goods is an economic vote /for/ corrupt governance practices and organised crime, and a vote /for/ the status quo.
Those who rage against Indonesia's kleptocrats but purchase illegal goods (e.g. pirated DVDs, drugs) and services (e.g. prostitution) are insulting hypocrites. They should shut up or put up!
Sincerely,
John Orford
Von: John Orford
An: editorial@thejakartapost.com
Datum: Heute 14:38:30
Dear Sir / Madam,
The "Concept of counterfeiting revisited" (30th Sept.) article entirely missed the point.
Indonesia has higher priorities than protecting the intellectual property rights and revenue streams of Messrs. Schwarzenegger and Chan, and rightly so.
The point however, is that the counterfeit goods industry breeds industrial scale corruption and organised crime.
Every Rupiah spent on pirated goods is an economic vote /for/ corrupt governance practices and organised crime, and a vote /for/ the status quo.
Those who rage against Indonesia's kleptocrats but purchase illegal goods (e.g. pirated DVDs, drugs) and services (e.g. prostitution) are insulting hypocrites. They should shut up or put up!
Sincerely,
John Orford
Thursday, September 28, 2006
Monday, September 25, 2006
Genocides in Affluent Societies
Have there ever been genocides within affluent societies? (there must have been...)
I'm reading Collapse by Jared Diamond at the moment, and it seems blindingly obvious, but I never realised how mass killing generally only happens in poor societies.
I'm reading Collapse by Jared Diamond at the moment, and it seems blindingly obvious, but I never realised how mass killing generally only happens in poor societies.
Friday, September 15, 2006
Economics and Democracy
Democracy (in the European sense of the word at least) is good for an economy, because:
1) It's fucking hard to run a country. Autocracies can do very well in the short and maybe medium term, but they all become unstuck sooner or later. (Even if they are benevolent dictators, they can pursue wrongminded policies). Democracies do better over the longer term, because more people can input and debate problems.
2) People can't revolt against themselves. Zero chance of coup d'etats, coloured revolutions etc. - helps when you're running a business.
3) Politicians are accountable. Press can root about and uncover wrongdoings, which help ensure good governance and less corruption.
However autocracies (genuinely) aren't unpopular in many countries, as long as:
1) Enough people feel wealthy. I.e. the middle classes are too ensconced in the next holiday they're booking, or toyota model they are going to buy, to worry about a discontented minority (who they are not completely ignorant of... but that package holiday to Phuket looks so dreamy!).
But economics is fickle, because:
1) it's /the/ hard science (forget physics etc.) meaning that even the best macroeconomists don't really have much of a clue about what's going to happen next, let alone how best to guide an economy.
When autocracies come up against bear markets, they find it hard to survive - because:
1) There isn't enough money for package holidays (not to mention decent food) and therefore a majority becomes discontented, and blame their leader's mismanagement.
--------------------------
I don't think China is all that far away from doing an Indonesia in the coming decade if it continues its strong growth. There won't be a monetary crisis, but so much capital investment means that a large amount should have been misallocated (either due to shear over-exuberance, diseconomies of scale, or corruption/fraud).
Many of these misallocations will have been dutifully covered up, but they will eventually tell sooner or later, as happened with Indonesia. And when they do, there will be a huge fallout. The standard of living will stay relatively high historically because it's hard to physically destroy capital (human or otherwise). Nevertheless, there will be increased political pressure for reform in China and economic instability.
1) It's fucking hard to run a country. Autocracies can do very well in the short and maybe medium term, but they all become unstuck sooner or later. (Even if they are benevolent dictators, they can pursue wrongminded policies). Democracies do better over the longer term, because more people can input and debate problems.
2) People can't revolt against themselves. Zero chance of coup d'etats, coloured revolutions etc. - helps when you're running a business.
3) Politicians are accountable. Press can root about and uncover wrongdoings, which help ensure good governance and less corruption.
However autocracies (genuinely) aren't unpopular in many countries, as long as:
1) Enough people feel wealthy. I.e. the middle classes are too ensconced in the next holiday they're booking, or toyota model they are going to buy, to worry about a discontented minority (who they are not completely ignorant of... but that package holiday to Phuket looks so dreamy!).
But economics is fickle, because:
1) it's /the/ hard science (forget physics etc.) meaning that even the best macroeconomists don't really have much of a clue about what's going to happen next, let alone how best to guide an economy.
When autocracies come up against bear markets, they find it hard to survive - because:
1) There isn't enough money for package holidays (not to mention decent food) and therefore a majority becomes discontented, and blame their leader's mismanagement.
--------------------------
I don't think China is all that far away from doing an Indonesia in the coming decade if it continues its strong growth. There won't be a monetary crisis, but so much capital investment means that a large amount should have been misallocated (either due to shear over-exuberance, diseconomies of scale, or corruption/fraud).
Many of these misallocations will have been dutifully covered up, but they will eventually tell sooner or later, as happened with Indonesia. And when they do, there will be a huge fallout. The standard of living will stay relatively high historically because it's hard to physically destroy capital (human or otherwise). Nevertheless, there will be increased political pressure for reform in China and economic instability.
Monday, September 11, 2006
The Cons and Cons of Lots of Exports
Just read two interesting posts, basically what I should have written for the Jakarta Post (cos they asked) but I ended up not...
When people think of countries they sometimes liken them to firms. If your revenues are higher than your costs, you are doing well, you are obviously earning profits.
But international trade is a more subtle game.
You could liken it to cups, where there's a ball under one of three cups, and your opponent tries to use slight of hand to ensure you can't find the ball.
Or maybe it's like pass the parcel, but the parcel is a booby prize.
In trade you have to look at who ends up with the cash.
Whoever has massive piles of cash is a clear loser, cos they have swapped all their goods and services for pieces of paper.
Not only that, but in the two blog posts below, many govts of poor countries seem to be holding onto pieces of paper which don't offer much return at all. In fact they are giving (generously) as much as 5% of the gains from their hoard to developed countries.
Indonesia for example has $50bn hoarded away for a rainy day which earns near nothing year on year. As 'Sarapan points out, $50bn * 5% = 2007's budget deficit.
But that's nothing, China has almost $1000bn hidden away for a rainy day when it will have to defend its currency peg. Something like 20% of the income the whole of China generates a year. The peg is kinda nice, because we outside China can exchange less paper to get more fun electronics and cool clothes etc. The Chinese end up being the with the paper! - suckers!!
Of course China is doing well, but they are doing well because of their huge labour force and general stability, not because of their hoard of US dollar and TBills. Non economists worry too much about money, money is just an illusion, don't hoard it, get rid of it!
http://pgpblog.worldbank.org/almost_a_free_lunch_lawrence_summers_at_the_world_bank
http://sarapanekonomi.blogspot.com/2006/09/lending-to-world-at-low-real-rates.html
When people think of countries they sometimes liken them to firms. If your revenues are higher than your costs, you are doing well, you are obviously earning profits.
But international trade is a more subtle game.
You could liken it to cups, where there's a ball under one of three cups, and your opponent tries to use slight of hand to ensure you can't find the ball.
Or maybe it's like pass the parcel, but the parcel is a booby prize.
In trade you have to look at who ends up with the cash.
Whoever has massive piles of cash is a clear loser, cos they have swapped all their goods and services for pieces of paper.
Not only that, but in the two blog posts below, many govts of poor countries seem to be holding onto pieces of paper which don't offer much return at all. In fact they are giving (generously) as much as 5% of the gains from their hoard to developed countries.
Indonesia for example has $50bn hoarded away for a rainy day which earns near nothing year on year. As 'Sarapan points out, $50bn * 5% = 2007's budget deficit.
But that's nothing, China has almost $1000bn hidden away for a rainy day when it will have to defend its currency peg. Something like 20% of the income the whole of China generates a year. The peg is kinda nice, because we outside China can exchange less paper to get more fun electronics and cool clothes etc. The Chinese end up being the with the paper! - suckers!!
Of course China is doing well, but they are doing well because of their huge labour force and general stability, not because of their hoard of US dollar and TBills. Non economists worry too much about money, money is just an illusion, don't hoard it, get rid of it!
http://pgpblog.worldbank.org/almost_a_free_lunch_lawrence_summers_at_the_world_bank
http://sarapanekonomi.blogspot.com/2006/09/lending-to-world-at-low-real-rates.html
Saturday, August 12, 2006
Freedom of Movement
While in Indonesia last March, the juxtaposition of poverty and wealth was shocking. If you're wealthy you breath pure air conditioning 24/7. If you're poor you, your wife and children could make a living begging at traffic lights or rummaging through the rubbish dump you happen to live on, and breathe the toxic fumes of the world's most polluted city.
Last year Bob Geldof did Live Aid 2006. There was one thing that Bob said which really struck me: "in a world of plenty it was intellectually and morally absurd that people should be starving to death" (paraphrase).
I don't think Live Aid and the Glen Eagles G7 summit has done all that much to help. Politicians don't really care about poverty in other countries - they care about taxation and unemployment, because their electorate does.
If a couple of hundred thousand of people are starving in Africa, they should be able to travel to Europe / America etc. and allowed to starve on our doorsteps.
Aid handouts will never work. Governments need real motivation. Economic emigration should become a human right.
This will likely never happen - because of that least endearing of human traits, selfishness. There is no end in sight of human starvation in a world of plenty.
Last year Bob Geldof did Live Aid 2006. There was one thing that Bob said which really struck me: "in a world of plenty it was intellectually and morally absurd that people should be starving to death" (paraphrase).
I don't think Live Aid and the Glen Eagles G7 summit has done all that much to help. Politicians don't really care about poverty in other countries - they care about taxation and unemployment, because their electorate does.
If a couple of hundred thousand of people are starving in Africa, they should be able to travel to Europe / America etc. and allowed to starve on our doorsteps.
Aid handouts will never work. Governments need real motivation. Economic emigration should become a human right.
This will likely never happen - because of that least endearing of human traits, selfishness. There is no end in sight of human starvation in a world of plenty.
Thursday, August 03, 2006
Holy Imperfection
There's a theory in economics which basically says that no contract can cover all facets of an arrangement. There will always be outcomes which will throw up ambiguities.
That's why we have lawyers, and why they get paid so much!
But when you apply this line of thinking to Holy books (the Bible, the Koran etc.) you realise that:
a) they are not "perfect" messages (from God) - at best they are general hand waving.
and
b) these books need humans to figures out the ambiguities, the tough answers aren't self evident
(/Humans/ are the integral part of our understanding of God)
I suppose all this is already clear. When you hear Taleban legal eagles proving how their actions have been OKed by God and the Koran, and Saudis getting 3 week "marriages" in Indonesia just so they lay their consciences to rest... (http://thejakartapost.com/detailheadlines.asp?fileid=20060803.A07&irec=6). Needless to say there are tons of Christian examples...
That's why we have lawyers, and why they get paid so much!
But when you apply this line of thinking to Holy books (the Bible, the Koran etc.) you realise that:
a) they are not "perfect" messages (from God) - at best they are general hand waving.
and
b) these books need humans to figures out the ambiguities, the tough answers aren't self evident
(/Humans/ are the integral part of our understanding of God)
I suppose all this is already clear. When you hear Taleban legal eagles proving how their actions have been OKed by God and the Koran, and Saudis getting 3 week "marriages" in Indonesia just so they lay their consciences to rest... (http://thejakartapost.com/detailheadlines.asp?fileid=20060803.A07&irec=6). Needless to say there are tons of Christian examples...
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