Economics & Marginalia: January 21, 2022

Hi all,

I once saw Meat Loaf speak at the Oxford Union (an institution and building I otherwise spent a great deal of time ignoring; considering some of the characters it has belched out into public life in the last couple of decades I made a wise choice). He was fantastic: full of good stories (ranging from buying a whole sturgeon to spite a snooty shopkeeper to picking up a hitchhiker who turned out to be Charles Manson), wit and a healthy sense of the absurdity of the occasion, which tracks well with a man whose most famous songs include “I’d lie for you (and that’s the truth)”, and “I’d do anything for love (but I won’t do that)”—apparently, he is the only writer in the world with more well-worn parentheses keys than me. Mr. Loaf died yesterday, and the world is a little bit less fun as a result. As ever, we take solace in economics.

1. At its heart, economics is quite a simple discipline. There are powerful forces that shape our lives, and the ways in which they respond to changes in the world around us, and a great deal of economics is simply about better understanding these forces. It’s instructive, though, to take a step back and just consider the incredible impact they have on our lives, which is exactly what Max Roser does in this primer on economic growth. Even if you live and breathe economics, there is something here for you. He drew me in with his very first graph, on the number of books produced each year from the 6^th Century to the 18^th century, an amazing depiction of the life-changing impact of changes in productivity.  

2. In a similar vein, it shouldn’t be a surprise that better communications networks improve lives: we can tell each other what is happening and the scope of what is local expands, and with it the economic possibilities at our fingertips. Nevertheless it is still striking just how profound the influence is: Pei Gao and Yu Hsiang-Lei have a nice write-up in VoxDev showing the impact of better telegraph networks on food price volatility. I’ve been thinking about how much basic building blocks of a modern economy matter, and how bad they still are in much of the world.

3. The pace of growth can also be dizzying, bringing with it both freedom (from family and social strictures, to pursue activities and pastimes that would be impossible without higher productivity) and challenges. Branko Milanovic reviews a new book about Dehli, using the city as a microcosm of such changes and a harbinger of a world dominated by new modes of production, just as Manchester would have been on the eve of the Industrial Revolution.

4. By the time the clocks strike midnight today, the average British citizen will have emitted more carbon dioxide than the citizens of 22 mainly low-income countries will over the entirety of 2022. In an effort to highlight the staggering hypocrisy of developed countries restricting access to finance for fossil fuels in developing countries while massively outstripping their contribution to global emissions, my colleague Euan Ritchie has developed a calendar which shows when the average Brit goes past people in poorer countries annual emissions. January is very busy indeed.

5. Tim Harford is hopeful for 2022. I am tentatively in his camp (despite Bob Saget and Meat Loaf in consecutive weeks). Let us see.

6. Lastly, the Onion captures perfectly what it’s like to be an economist in a world of mainly non-economists (or, I imagine, a statistician in a world of economists). “’Obviously, most everyone in the nation has already at least skimmed the seminal studies of psychologist Danny Kahneman on the fallibility of human thinking’… Walensky added that if Americans took away one easy lesson from the pamphlet, she hoped it would be P(H|E) = (P(E|H) *P(H))/P(E).” And if that doesn’t have you rolling on the floor laughing, here’s the cast of Derry Girls summarising famous novels in a single sentence. “I have a fringe, and cigarettes, and opinions” is better than the actual blurb on the back of The Woman Destroyed.

Have a great weekend, everyone!

R