Economics & Marginalia: April 26, 2024

Hi all,

The links are back after a two-and-a-half week break in Argentina, and to be honest, my brain is still not fully re-engaged. Argentina is a hard place to be an economist: announcing your profession begets many questions, some of them hostile, and all of them difficult. It's an amazing place: friendly, with good food and wine and incredible birdlife and an absolutely ludicrous economic model. I spoke to many people about how things are going (badly, for the most part), and how they can be fixed (with great difficulty, or not at all, for the most part), and their predictions for the future (also not the most optimistic). As a Sri Lankan, I felt very at home with garrulous, family-oriented culture, diverse avifauna and insane public policy environment; the English part of me noted both the signs and graffiti proclaiming 'Las Malvinas Son Argentinas' and the fact that most of the graffiti and iconography of Maradona (still much more prevalent than that for Messi everywhere except Rosario) chose the Hand of God moment over the moment he actually lifted the World Cup. A complicated, fascinating place; I can't wait to go back.

1. I had something like one thousand articles and blogs backed up on my reader to work through on my return, not all of which made a full impression on a jet lagged and heavily vinified brain, but this piece by Mark Miller was excellent and provocative. BII, the UK's development finance institution, was in the news recently; the complaint was that they were investing in the wrong kinds of thing: frivolities like lipstick and a dating app (the latter something they didn't actually invest in, but was standing nearby one of its investments, inducing a sort of guilt-by-association). Mark, correctly, points out that this is completely ludicrous. Making frivolous crap *is* economic development. You make stuff, and sell it to people richer than you, then you diversify and make more stuff. It would be one thing if BII was distributing lipstick to people and calling it development, but making it is very obviously a good thing to do. Mark's point-that if you replaced 'lipstick' with 'cars' or 'pencils' we'd hail it as a great thing-is quite right, as is the bigger point he makes: too much energy and attention is being spent by the UK development sector on how our aid looks, and not nearly enough on what it achieves. This is a general problem: we are obsessed with inputs and process for their own sake. Of course they matter, and can matter for their own sake, but the prominence they get, to the exclusion of the bigger question of what actually changes in a developing country as a result of our support is entirely unreasonable.
2. And while we're on provocative and interesting, Duncan Green's blog learning from failure (or rather, catastrophe and humiliation, as he puts it) is fantastic. Duncan relates mistakes large and small that he has made, and what he learnt from them. It's both funny and thought-provoking, like John Cleese before he left funny behind and just became a provocative crank. It made me think of my own most egregious failures and mistakes; I don't think I'm quite ready, as Duncan did, to turn them all into a blog, but it was uncomfortably easy to think of mistakes I've made and things I've changed my mind over, quite significantly. What's hardest is that when I can remember the thought process that led me to the mistakes, I can see where it came from, but also how I would quite possibly walk down the same wrong turns of judgment and logic that led me astray the first time. Perhaps that means I haven't learnt enough from some of them yet.
3. Ken Opalo is singing my song here (in fact, we're singing in harmony with Vij Ramachandran, Todd Moss, Charles Kenny, Hannah Ritchie and others): energy poverty is a horrific thing; a life-shortening, opportunity-limiting, outrage. The climate strategy that works for the world is not simply the one that finds the fastest path to zero carbon, but the one that finds the fastest path to zero carbon that enables us to end energy poverty. Growth, including in countries that currently consume very little energy is part of the solution to energy policy; it is largely the solution for development. He discusses the use of solid-fuel cookstoves and their effect on health outcomes in Africa and says something I have also recently pointed out: if we want people to change their cooking habits to improve their health, helping them get rich is pretty much the answer. We can spend a lot of time and effort making it possible for them to do better while we try and improve their incomes (and we absolutely should make these efforts, building on recent successes), but ultimately, as for many things, prosperity solves a lot.
4. While we're on climate, I also really enjoyed this, from Euan Ritchie and Martha Getachew Bekele, on defining climate finance.
5. Branko Milanovic on Keynes's failure to take inequality seriously is great. It's a novel perspective (well, not entirely novel: he cites a paper from 1937 that makes much the same point), and one that had, shamefully, never occurred to me. I've read Keynes in the original and a huge amount of secondary writing about him, and his obvious and glaring failure to discuss inequality and its role in aggregate demand had never previously hit me. I can sort of understand where it came from (though this is perhaps a post-hoc justification given my admiration of Keynes), but that doesn't make it less striking.
6. And Keynes's distant relative, Soumaya Keynes, has a very good piece in the FT about the failure of economists to make the most of their learning and professional knowledge to improve public policy, a topic I hope to write more on in the future; relatedly, Oliver Hanney has a superb and comprehensive round-up of the work he's been reading on how economists (and evidence more broadly) can influence policymakers. This topic is having a moment, and deservedly.
7. Finally, one of the most fascinating and horrifying things I've read in a long time: Elle Griffin on how few people read most books. She uses data and information released as part of the Penguin Random House antitrust suit to look at how poorly-read most books are, how heavily publisher depend on a few hits, and how much of the market for books is made up of a small selection of readers (of which I presumably am one). It's really interesting; I also felt it somehow missed the mark (though again, my own love of books may be clouding my judgement here). Not all books are meant to sell well, and not all success can be measured in the number of people reached. The publication of a wide catalogue of books is a good on its own terms; the availability of a range of perspectives, ideas and stories matters for their own sake. Perhaps self-publishing can replicate this; but I rather think that the gatekeeping and quality assurance rather contributes to that value. And I love physical books. I cannot imagine living in a house where I couldn't look at the walls and pick something up on a whim to explore. A digital rental option (which, she suggests, would end the publishing industry as we know it) just isn't the same. I thought we lost something when music became so digital for much the same reason; and perhaps that makes me a technophobe, but I think there's more too it than that.

Have a great weekend, everyone!

R

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