Archive for category Growth

Briefing: Economic Complexity - of Robots, T-Shirts and Iron Ore

Of Robots, T-Shirts and Iron Ore

complexity_detail

Have you ever wondered what goes into the making of a t-shirt, business shirt or blouse – like the one you are most likely wearing right now?

Obviously there are the raw materials – cotton most probably, some plastics perhaps – but what else is important when making a piece of clothing? Most probably the shirt was made with a sewing machine; in a factory; which sat at the end of a road-way or a train-line enabling the raw materials to arrive at the factory gate, and the shirts to leave for sale; the factory probably ran on electricity; the workers were trained to use the sewing machines, in the company culture and values; whilst other workers generated the design and plans for each shirt; whilst still other workers focused on efficient management, incentive schemes, productivity improvements, finance, risk analysis, marketing, sales and surveys.
As you can see, there is a lot going on to make the humble t-shirt.

But what about something more complicated, like a production-line robot? Or something less complicated to find, but just as complicated to make commercially available like iron ore? Robots need similar inputs to t-shirts – labour, raw materials, designs, electricity roads and so on – but they need different raw materials, and more precise scientific knowledge. Iron ore needs mining equipment, engineering knowledge, and of course, an endowment of iron ore to discover and extract.

Now consider the fact that t-shirts, robots and iron-ore are not made in the same place, by the same country. A likely source for your shirt is Pakistan, whilst the manufacturing robotics comes from Germany, yet Australia is the home of global iron ore production. It is worth pausing to consider why should that be? Why should some countries produce only some goods or services to the exclusion of others?

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Pietro Peretto (Duke) on The Economics of Prosperity on a Finite Planet

Pietro Peretto (Duke)

Pietro Peretto (Duke)

Pietro Peretto, Professor of Economics, Duke University, is tackling the very biggest topic in Economics — How can humanity experience increasing living standards in a world of finite resources? Or more particularly, does the stabilisation of population levels imply the cessation of economic prosperity gains? Professor Peretto is a theorist who has been developing analytical models of human output and interaction with the environment. Professor Peretto was in Melbourne recently for the 17th Australasian Macroeconomic Workshop, at Monash University.

Read the paper on which this Podcast is based: Peretto, Pietro F. and Valente, Simone, Growth on a Finite Planet: Resources, Technology and Population in the Long Run (June 29, 2011). Economic Research Initiatives at Duke (ERID) Working Paper No. 103.

Or download the podcast here: download (mp3)

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Markus Brueckner (U of Adelaide) on Economic Growth, Foreign Aid and Causality

Markus Brueckner (University of Adelaide)

Markus Brueckner (University of Adelaide)

Markus Brueckner is a senior lecturer at the School of Economics, University of Adelaide, and has research interests including economic growth, political economy and applied econometrics. Along with a number of articles published in highly respected academic journals, Dr Brueckner has written for the New York Times, The Economist and the Wall Street Journal.

In his most recent work, Dr Brueckner has been looking at the link between foreign aid and growth, or more specifically growth and foreign aid. I began our discussion for EconomicsNow! by asking Markus to outline the present consensus view amongst academic economists on the relationship between foreign aid and economic growth.

Read the paper on which this Podcast is based: “On the Simultaneity Problem in the Aid and Growth Debate.” Journal of Applied Econometrics (Forthcoming).

Or download the podcast here: download (mp3)

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Keynes vs. Hayek: round 2 “Fight of the Century”

Another brilliant EconTv video from Keynes and Hayek. This time, the stage is as a Congress House Committee to analyse whether or not the US stimulus package was a good thing after all. Predictably, Keynes argues on the basis of ‘managing’ volatile markets with low information, whilst Hayek argues for more humility, saying that the economic system is complex, and so far better to let individual economic agents decide where, when and how to spend, rather than ‘the few’ in the government to do this job. Fascinating stuff:

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More BOOM and Bust!

Well, given recent events in global markets, it’s about time that the coolest, hippest rappers of modern economics put their pens back to the page and fired up the beat-box! If you haven’t seen the first installment of Boom and Bust then watch that first. … It will make this update all the more fascinating. … Though, as my good friend and co-author, Dr Ben Waterhouse aptly says, you can’t get much better than the line in the first rap where they manages to rap “invective” and “Austrian perspective”!

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Putting the BOOM back into Economics

OK, I know, at times Economics and Economists get some bad press about their image, their character, their long explanations, their poor predictions .. their long sentences … ahem… But one thing that is not disputed is that the world still puts a lot of store in their advice. And particularly so when it comes to very big economic fluctuations. You will no doubt have seen claim and counter-claim on the benefits and costs of following this policy or that when it comes to ‘fixing’ the world economy after the latest recession.

Two names loom large in that debate: Hayek and Keynes. And now, thanks to the superb script and deft direction of the folks over at Econ Stories, Economics eduction now, literally, raps it to the masses. Watch and learn, folks. Watch and learn …

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Africa has to find its own road to prosperity (FT opinion)

(Thanks to Ben Hirons) With respect of Dambisa Moyo’s thoughts on Dead Aid here is another President of an African nation, this time, Paul Kagame of Rwanda making a case for leading Africa out of poverty by innovation rather than systemic ‘plans’, or ’strategies’. As Kagame says, Rwanda faces enormous challenges, both geographically, politically, historically, and in terms of education and health, and yet, the optimism he displays is both courageous and determined.

Read his comments here:

FT.com / Comment / Opinion - Africa has to find its own road to prosperity.

Note: Kagame’s target of a four-fold increase in per-capita incomes in ‘a generation’ (or around 20 years), requires a GDP/cap growth rate of 7%. Considering that Rwanda has a projected population growth rate of just under 3%, this will require a GDP growth rate of 10%. And there, if ever, is the African challenge.

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Jakob Madsen on Models of Economic Growth

Jakob Madsen, Professor of Economics at Monash University has spent many years in Macro-economic research. He has a particular interest in long-run growth, the models that have been used to explain it, and the data that aims to test these models. In his recent work, he is examining so-called ’second-generation’ endogenous growth models, such as the Schumpeterian growth model. In this interview, Professor Madsen talks about some of his recent work on economic growth and how this bears on economic policy for development in the world’s poorest regions.

Or download the podcast here: download (mp3)

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Tim Hatton on Height and Health in Britain 1880-1950

Professor Tim Hatton of the Economics Program at the Research School of Social Sciences (ANU) spoke to us about his research on health and height (stature) in turn-of-the-century Britain. What is interesting about his work, is that his data set comes from the 1937 study by Sir John Boyd Orr of working class children in 16 locations in England and Scotland and allows the study of the famous `quality, quantity tradeoff’. The interview begins by asking Tim to explain exactly what this means.

Or download the podcast here: download (mp3)

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Greg Clark on Social Darwinianism and the Industrial Revolution

Greg Clark (U.Cal at Davis)

Greg Clark, Professor of Economics at University of California, Davis and author of A Farewell to Alms was recently in Australia to present a seminar on his controversial theory of Social Darwinianism to explain the industrial revolution in England. Prof. Davis, was kind enough to speak to EconomicsNow! about this work, the Malthusian Trap and why doing Economic History is well worth the effort!

Or download the podcast here: download (mp3)

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