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May 2024

My wish for this year’s Nobel prize in economics

I know it’s a fool’s business trying to predict who is going to win the prize every year.

But here is my wish:

Oliver Hart and/or Ben Holmstrom

For his (or their) contribution to the theory of firm.

Minsky on financial instability

Stability is destabilizing.

BBC runs a 30-minute program on Minsky and why his insights matter.

minsky bbc

Bob Shiller on bubbles and psychology

This was an interview in last December from PBS.

Bob Shiller: The whole idea that the stock market reflects fundamentals is, I think, wrong. It really reflects psychology. The aggregate stock market reflects psychology more than fundamentals.

Shiller also pointed out why economists at the Fed will not call it a bubble even when they see it – This has something to do with group think and self-censorship.


Economics of holiday gift-giving

A survey of leading economists on the following statement:

Giving specific presents as holiday gifts is inefficient,because recipients could satisfy their preferences much better with cash.


Link to the survey results


Do more choices make people happier?

It’s one of the fundamental assumptions in economics that people’s welfare will improve with more choices, and more varieties.  In the following TED video, Sheena Iyengar at Columbia challenges such view with some vivid examples.  She also offered some clever ways to avoid the problem of choice-overload.


Coase: China needs to have a free market for “ideas”

Ronald Coase, Nobel-winning economist, whose economic theory on property rights has had a profound impact on China’s economic reform in the past 30 years, prescribes medicine for China’s long-term sustained economic growth: to have a free market for ideas.

What Coase essentially argued was that China needed to have a free and open society. This would immediately mean the transformation of the current political regime.

Watch this ten-minute video:

Doyne Farmer interview: macroecnomics from bottom up

Agent-based modeling of housing market and macroeconomy, explained by Doyne Farmer:

Time perspective of human behavior

Revealing the secrets of time – How people’s perspective of past, present and future shapes people’s behavior…and to some extent, a country’s development.

(hat tip to Carlos Yepez for providing the link)