Tag Archives: economics

Global Economic History

Global Economic History: A Very Short Introduction (2011) by Robert C Allen is an excellent overview of the world’s economy. Allen is a professor of economic history and clearly knows his subject in depth. The book is well written and provides an excellent overview of global economics.

The chapters are The Great Divergence, The Rise of the West, The Industrial Revolution, The Ascent of the Rich, The Great Empires, The Americas, Africa, The Standard Model and Late Industrialisation and big Push Industrialisation.

The book has a standard model for economic development from the 19th century. Mass education, transportation improvements, a national bank for stable currency and tariffs to protect nascent industry.

The book is actually more than the sum of the parts. The combination of Allen’s expertise, the subject and the requirement for succinctness is really quite something. Allen’s stating of various theories and his own ideas about what helped and hindered economic development in the varying specific cases is really good. It would be hard not to learn quite a bit from the book.

Global Economic History is a surprisingly successful book on a big subject. Allen writes well and provides a really excellent overview of the subject.

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Selfish Reasons to Have More Kids

Selfish Reasons to Have More Kids: Why Being a Great Parent is Less Work and More Fun Than You Think (2011) by Bryan Caplan is a Libertarian Economist’s view of why people should have more kids than they think and his views of parenting.

Caplan thinks that people should have more kids because kids are really good to have when they are 30 and that people spend too much time trying to get everything right for their kids and over protecting them with helicopter parenting and such.

He looks at the very strong evidence of twin studies that shows that genetics dominate in what people become with environment being fairly haphazard. It’s really very strong, identical twins show far more similarity than fraternal ones and adoption makes little different in outcomes. Except, for as Caplan states and is true, whether your kids like you. Care for your children reasonably but try and make time for what you enjoy as well. Don’t make yourself a slave is what he is saying because the evidence indicates that it isn’t worth it.

Unfortunately Caplan doesn’t discuss the best bit of evidence against this – ‘Tiger Mums’ and East Asian parenting and achievement. Or would he argue that something genetic in East Asians makes that group perform better academically?

The book goes through lots of solid evidence about twin studies and genetics and the fact that environmental randomness isn’t controllable. He also summarises ‘Free Range Parenting’ and shows that there is very strong evidence for allowing kids to walk to school at a fairly young age and to be as independent as possible.

The book also echoes arguments about why having kids isn’t that bad for environmental reasons and makes the important point that people are Julian Simon’s Ultimate Resource.

The book is well written and fairly clear. It’s not a great book but it is worth a read and provides food for thought.

Bullshit Jobs: A Theory

Bullshit Jobs: A Theory (2018) by David Graeber is a really interesting book that looks at how people perceive their jobs as pointless and what Graeber thinks. Graeber describes himself as an an ‘anarchist and anthropologist’.

Graeber wrote an essay in 2013 ‘On the Phenomenon of Bullshit Jobs’ which was very popular online. After the book was written he solicited and obtained many accounts of people who found their jobs to be a waste of time and how they dealt with them. This book is the result. Graeber combines these accounts with his theories of anarchism and how society and the economy works. The accounts are remarkable and often very amusing as well as genuinely interesting. Graebers theorizing as to what work is productive and how things should be organised is far less compelling.

It would be hard to find people who have either experienced or seen people working in jobs which were, essentially pointless but that were often quite well paid. Graeber suggests that people who work in communication, HR and corporate lawyers are anyone who works in finance as working in jobs that don’t need to be done and that they know do not need to be done.

Graeber takes issues with other people who have defined jobs that don’t need to be done to include telephone sanitizers and hairdressers, including Douglas Adams and thinks that instead many private sector and administrative jobs are the ones that truly don’t need to be done.

He certainly has a point. There are undoubtedly many people writing reports that are ignored and even most economists would agree that the finance sector has expanded beyond what is productive. Graeber classifies BS jobs as ‘Flunkies’, ‘Goons’, ‘Duct Tapers’, ‘Box Tickers’ and ‘Taskmasters’. When asked in an online UK YouGov poll 37% of respondents said that they were sure what they did made no meaningful contribution to the world. This is extrapolated by Graeber to suggest that at least a third of the workforce isn’t really doing anything useful and they know it.

Many of the accounts of people with BS jobs are fantastic. People given jobs on projects known to be pointless is a remarkable thing. That many firms and governments have done this is quite something. Graeber points out that many accounts of these things happening largely in the public sector are wrong. Although even he can’t help pointing out some incredible examples in the public sector where people even stop going to work and continue to get paid for years. He also does suggest, but downplays that people who have a BS job in many places can convert it to a useful job once they are inside an organisation.

Graeber goes on to provide his theory of how society and the economy should be organised and this is fairly weak. Instead of acknowledging that markets have provided unprecedented prosperity for many people he states that the whole system needs to be dismantled. The idea that markets have changed the world dramatically for the better but that they are still often terribly wasteful and that with some thought perhaps working hours might be substantially reduced is not even discussed and instead various classes in conflict are proposed. He goes on to suggest that a universal basic income UBI would stop people doing pointless work and make us all better off. Graeber blithely seems to think that the pointless jobs can be easily identified and that UBI would happily work.

Bullshit Jobs is a genuinely interesting book. Hopefully lots of people read it and think about the myriad of inefficiencies that it points out. However, the theories and answers offered by Graeber are far less strong.

 

 

 

Triumph of the City

Triumph of the City : How our Greatest Invention Makes Us Richer, Smarter, Greener, Healthier and Happier (2011) by Edward Glaeser is a really good, though provoking book about cities and how they work. It’s also very readable.

Glaeser is a Harvard economics professor and a former New Yorker and his book is quite something. He looks at how cities have changed over the past 100 years, what they enable, how people are priced out of them today and what is makes a low C02 emitting city.

Glaeser did some fantastic work calculating the ‘zoning premium’ and includes it in the book. It shows how zoning has caused housing prices to be far higher than necessary by not allowing people to build up and out as they would if land use were not restricted.

The book also has some really interesting points about how cities have enabled people to be far more productive and are better in many ways for the environment than living in less technologically advanced ways that use more space.

Triumph of the City really is an excellent book that anyone interested in economics and cities and how it can all work.

The Tyranny of Metrics

The Tyranny of Metrics (2018) by Jerry Z Muller is an interesting look at problems caused by misusing metrics. It’s impressively short and Muller has read widely and pondered the problems caused by over relying on poor metrics.

Muller outlines why metrics have been used. It looks at increasing costs and people wanting, wisely, to improve productivity. Metrics were also seen as a way of resolving the principal / agent problem. They were also seen as a way of doing something objective to assess outcomes. Looking at numbers and working on productivity also helped manufacturing improve. Applying similar ideas to services, wars, education, health, police and other areas seemed like a good idea.

In practice, however, using metrics has led to many perverse outcomes. In education, just getting more people to go to University and get good grades has led to more people just going, many of whom don’t gain much from their education and also to US ‘grade inflation’. Their professors, meanwhile pump out more papers and join paper citation circles to pump their ‘impact factor’.┬áIn war ‘body counts’ as a measure of success in Vietnam contributed to the US failure there. In medicine it’s led to doctors avoiding difficult cases. Optimising for short term profits has even harmed many businesses.

Muller concludes by providing a guideline for when and how to use metrics.

Muller isn’t against all metrics, but he is making a very good case that they are often misused and that people need to be very careful about how and where they are used. The book is very much worth a read for anyone interested in policy or economics.

The Case Against Education

The Case Against Education: Why the Education System is a Waste of Time and Money (2018) by Bryan Caplan is a fascinating read that questions the mantra that ‘more education is always good’. Caplan is a highly credentialed Professor of Economics at George Mason University. The book is heretical in that it takes on the belief that ‘more education = more better’ that is incredibly prevalent with policy professionals and politicians of all ideologies and with the public at large. The book has provoked a considerable response including headline reviews in The Economist.

The book looks at what students use and remember from their education. Caplan demonstrates solidly that this is not much. Few people do math in their job beyond high school level math and very, very few people use their knowledge of foreign languages, poetry or history.

Given that people remember and use little of their education Caplan then goes on to explain why education appears to yield such substantial economic benefits to those who have it. He answers this question by looking at the ‘sheepskin effect’, that is the effect of getting a certificate on earnings compared simply to additional years of learning. If it is very high, which it is, then it shows that it is the signalling effect of education rather than what is learn that is important. In effect employers use High School completion and degree completion as simple filters when hiring. It no doubt leads to some bad hires and some bad misses but overall it works well enough that most employers do this.

This has the result that education is worthwhile for individuals, provided they complete their degree, but as something subsidized massively by government it’s actually a fairly poor investment.

Caplan makes the poses the thought experiment of who would we expect to earn more, someone who had a certificate from a highly rated University without having learnt the subjects or someone who had done all the work but who had no certificate. It’s hard not to imagine the certificate being of more value in earning more.

The book also looks at the fantastic amount of high quality learning material that is now available online and says that because the most important effect of a University education is the signalling value that he believes that it won’t have that much impact. He points out that high quality paper testing has been available for decades but is rarely used by employers. One thing he doesn’t address though is that if the credentials for online courses do become even a bit more respected and more people shift to doing online degrees it may become a way of getting certification that is good enough more cheaply.

Some people say that while some University is clearly not useful but that STEM subjects are. Caplan addresses this by pointing out that a large percentage of STEM graduates do not use what they have learnt in their degree and that instead it appears that hard STEM courses are a signal of high levels of ability.

The one form of education that Caplan does approve of spending on is vocational education that he believes to have a reasonable demonstrable return.

The book covers a lot of the material of Alison Woolf’s Excellent book ‘Does Education Matter’ that looks at the impacts of education. Woolf is more skeptical of vocational education because she has seen the limited success of attempts to improve it in the UK.

Against Education is a very good book and Caplan has spent years thinking about and researching his ideas. What he presents is quite compelling. For anyone with an interest education policy the book is definitely worth reading. It’s also very well written and easy to read.

 

 

 

Cold War : A History from Beginning to End

Cold War : A History from Beginning to End by Hourly History (2016) is a very short, very silly history of the Cold War that is better to skip.

The book starts off by detailing the terrible repression that lead to the Cold War. This was, interestingly enough, in the US. It was allegedly furthered by the US just attempting to thwart Communist Revolutions that were happening around the world.

Russia apparently escaped The Great Depression via Communism. It must have been a great time there apparently, unless, possibly if you were one of the millions who died in the Holodomor. But this book, of course, doesn’t mention them. Russia apparently had a booming economy in the 1930s.

The book goes on to describe how Communism sprung up in Eastern Europe but allegedly the Americans tried to thwart and undermine this too. This led the Russians to become upset.

There is almost no mention of the massive repression in Communist states. There is no mention of the Great Leap forward where Communism caused at least 30 million people to starve.

This isn’t to say that the US’s behaviour was always good and that they didn’t support vicious, despicable dictators and regimes around the world in the fight against communism and that this did go against America’s ideals. However, to fail to look at the real horror of Communism and it’s economic failure when discussing the Cold War is laughable.

The book is really completely nonsense. I was hoping for something like the often excellent ‘short introduction to’ books but instead this book is completely fantastical.