Nobel in Economics

So as you know this year's prize goes to Krugman and rightly so. But it is also interesting to see that the Nobel committee is not above popular perceptions. In awarding the prize for work in international trade it conveniently forgot Jagdish Bhagwati and Avinash Dixit.

Bhagwati should have got it in his own right, though its diffcult to put your finger on one particular contribution. Dixit should have got it becasue Krugman would not have got it in first place if Dixit did not write that paper with Stiglitz!

So its important to do good work, but its probably more important to make your presence felt!

Economics of free labor mobility!

Ever wonder what would happen if humans moved freely across borders as against just goods and capital? Jess Benhabib and Boyan Jovanovic of the NYU have something interesting to say on this. They ask what level of migration would maximize world welfare. Welfare is assumed to be a weighted average of the utilities of the world’s various citizens. Using a calibrated one-sector model they find that unless the weights are heavily biased towards the rich, the extent of migration that would be optimal far exceeds the levels observed today. The claim remains true in a two-sector extension of the model.

Of course, political considerations and constraints are paramount in formulating an immigration policy; be it allowing in geeks or non-geeks! Notwithstanding this, the Benhabib-Jovanovic paper is definitely an interesting thought and simulation exercise in a relatively unexplored area of modeling and policy analysis.

Click here to read the article.

A Tale of Twenty Cities!

The National Council of Applied Economic Research (NCAER) has recently published a report titled, "The Next Urban Frontier: Twenty Cities to Watch". NCAER definitely expects the report to be a cash cow given that its priced at Rs.100,000 (approximately $2200)!

But that does not mean that you have to go without reading it. Here is a PowerPoint presentation based on the report. Relax, the numbers do all the talking!

McCain or Obama: What do economists think?

This recent article in the Economist gives interesting statistics on what Economists think about the two presidential candidates. Interesting points to note:

1. Economists either identify with the democrats or abstain from identification. Very few identify with the republicans.
   
2. A significant proportion of economists think that elections will influence the economic policy in years to come.

India-US Nuclear Deal

This controversial deal for trade in nuclear reactors targeted for civilian use has finally come through. All the downside apart, it will be great to have the energy problem solved in a much cleaner way. Read the coverage in the Financial Times for details.

However, given that the nuclear deal is for non military purposes, there is nothing ironic about it coming through on October 2, as FT would like us to believe!

Supreme Court, Hussain & Hindu Morality

The recent Supreme court's stand on M F Hussain's nude portrayal of Bharat mata as being a piece of art could come as a surprise to some. Of course the so called "Hindutva" brigade is not at all happy and the so called left- secular lobby could not but betray a smile!

Now are Hindu's really not used to having their gods and goddesses scantily or not clothed at all? The answer is no. Through out history we as people living beyond the Sindhu river have never been moralizing about nudity or overt displays of love and sex. We celebrated love, life and bodily pleasures. Look at the walls of Khajuraho or Konark temples or the various statues of fertility goddesses. To have a glimpse of how common people viewed these things read Gatha Saptashati. Now I know this is gross simplification and also anachronism, but you get the point right!

Hindu values (or the way VHP and likes would like to think about it) have changed a lot in the last two centuries and now resemble more the Victorian ideals of morality. So are they not real? Actually they are- we as Hindus today believe in Victorian ideals of morality as being the essence of being a Hindu. There is no problem with that. The problem is believing that it has always been like that or allowing politicians in fooling you to believe that way.

So is M F Hussain wrong in painting Bharat mata nude? As I said, some three hundred years back we would not have thought of it as wrong. But today we are different and we would react in a different way. Would every body join the bandwagon? I do not think so. There are still some people who see things differently or a have a more balanced perspective because of reading history.

Having said that, it is also notable that M F Hussain has never used his artistic expression to portray Islam or Christianity. It would be interesting to see how he would do it and how these religious groups react to it.

The so called left liberals and secularists are a different creed altogether. For e.g., I did not read any news about the secular brigade criticizing the Christian response to Dan Brown's Da Vinci Code in India. So its the art of politics that they have mastered or what we would call engaging in selective empiricism!

China and inflation in rich countries

This recent write up in The Economist gives some more arguments on why China cannot be blamed for the recent inflation in rich countries.