The wealth of nations

[Enzo]

In a recent Science News, I found this article interesting.

http://www.sciencenews.org/articles/20070901/bob9.asp

It describes a way of applying an apparently novel metric to world commerce. Seemed reasonable to me, but I have no way to put in in the context of the field.

As our resident economist, KOS, would you be willing to tell me if these guys have their heads screwed on right?

Has a groovy graphic:

[Мастер]

In a recent Science News, I found this article interesting.

http://www.sciencenews.org/articles/20070901/bob9.asp

It describes a way of applying an apparently novel metric to world commerce. Seemed reasonable to me, but I have no way to put in in the context of the field.

As our resident economist, KOS,

I wouldn't describe myself that way, although I did study economics. I'm more of an inter-disciplinary guy...

would you be willing to tell me if these guys have their heads screwed on right?

Has a groovy graphic:

Well, as a descriptive tool, I don't know that there's anything wrong with it. The fact that it is appearing in Science - well, I don't know if that's because they wanted it in Science, or because they couldn't get it in an economics journal. Both these people are from the Kennedy School, which is public policy, and that gets to what is slightly troubling to me about this. The web article (and this is the web article, not the actual article, maybe it misrepresents things) talks about using this analysis to help governments decide where to invest. If they're talking about infrastructure, that's one thing, if they're talking about actually investing in this, that, or the other industry, the fact that the government is deciding which industries investment dollars go to might go a long way in explaining why these countries have failed to develop...

So I guess my feeling is, this could be an interesting descriptive tool, but I don't know that I would want governments to base investment decisions on it (for the simple reason that I don't want governments making industrial investment decisions - infrastructure investment decisions are inevitable). But I've got nothing against it. #1 evil thing coming out of the Kennedy School remains Michael Sandel's article arguing that, although pollution trading schemes are economically efficient, they are immoral because they blur the distinction between right and wrong and dim the spirit of shared sacrifice. Prof. Sandel does not specify how much more greenhouse gas should be emitted or how much living standards should be lowered so that he doesn't have to see horrible shades of grey instead of nice clear black and white.

[Enzo]

Not Science, but Science News. Science is a big deal prestigious thing. Science News is a weekly 16 page news for the informed layman.

Thanks.

The impression I got was infrastructure, not simple investment.

[Мастер]

The impression I got was infrastructure, not simple investment.

OK, I've got no problem with that then :)

Although the history of economics is littered with spurious correlations, and the if-you-build-it-they-will-come approach doesn't always work out.

Not a development economist (although I know some, I could ask them what they think), but my feelings are, what most countries need to do to improve their economies is not some big secret. They just don't do them, usually because they threaten some powerful entrenched interest...