What Economists Could Learn from George Costanza(nytimes.com)
nytimes.com
What Economists Could Learn from George Costanza
https://www.nytimes.com/2024/12/23/opinion/what-economists-could-learn-from-george-costanza.html
5 comments
I used to think along these lines until I saw some "data" and then I wasn't so sure my habits were sound
https://en.wikipedia.org/wiki/Economic_complexity_index
In particular, it seems interesting to think in terms of pairs of countries (UK,US) but also (RU,UA)
Except for Argentina or Japan, of course
>the ECI is a more accurate predictor of GDP per capita growth than traditional measures of governance, competitiveness (World Economic Forum's Global Competitiveness Index) and human capital (as measured in terms of educational attainment). ECI also shows a strong negative correlation with income inequality, suggesting that more knowledge intense productive structures are more inclusive in terms of income distribution, and providing a statistically more powerful explanation of cross-national variations in income inequality than Kuznets Curve.[3]
https://en.wikipedia.org/wiki/Economic_complexity_index
In particular, it seems interesting to think in terms of pairs of countries (UK,US) but also (RU,UA)
Except for Argentina or Japan, of course
>the ECI is a more accurate predictor of GDP per capita growth than traditional measures of governance, competitiveness (World Economic Forum's Global Competitiveness Index) and human capital (as measured in terms of educational attainment). ECI also shows a strong negative correlation with income inequality, suggesting that more knowledge intense productive structures are more inclusive in terms of income distribution, and providing a statistically more powerful explanation of cross-national variations in income inequality than Kuznets Curve.[3]
https://surplusenergyeconomics.wordpress.com/2024/12/06/294-...
>The critical marker for this process is the Energy Cost of Energy, a measure of the proportion of accessed energy which, being consumed in the energy access process, is not available for any other economic purpose.
Sounds suspiciously close to the classic definition of entropy, if you ask me :)
The Costanza strategy for economists is therefore to teach physicists something instead of just learning from the 19th century ones
[Looking at you, https://en.wikipedia.org/wiki/Francis_Ysidro_Edgeworth ]
>The critical marker for this process is the Energy Cost of Energy, a measure of the proportion of accessed energy which, being consumed in the energy access process, is not available for any other economic purpose.
Sounds suspiciously close to the classic definition of entropy, if you ask me :)
The Costanza strategy for economists is therefore to teach physicists something instead of just learning from the 19th century ones
[Looking at you, https://en.wikipedia.org/wiki/Francis_Ysidro_Edgeworth ]
The economist who wrote this article could learn quite a bit from George too.
The wider article focuses on trade deficits and almost assumes they are inherently bad. Though, honestly, are they? Essentially, America gets away with giving smaller amounts of its output to other countries than these countries give America. If someone gives me $2 worth of goods for every $1 worth of goods I give them, I’m not complaining. Why should America?
It’s also not like this is a new thing. America has run a trade deficit every single year since 1975 (and plenty of years prior to 1975 were deficit years). Now isn’t even the highest it’s been; the highest was in 2005. Taking the last 20 years as a timetable, the deficit is pretty normal right now.
Also, do people actually look up what the deficit is? Because it’s 3.77% of GDP. The way people talk about it, you’d think it was in the 10s of percentage points, but it’s not… it’s honestly pretty minor.