On SubStack's Notes failure mode. I left Twitter for a reason and Notes doesn't seem to be giving me a reason to come back to a similar format. What I would have hoped for from Notes is the ability to follow respectful discussions between interesting writers, maybe with some ability to influence the content by suggesting topics, say.
On practical economics and benefit-cost analysis. Who even teaches this anymore? I agree everyone THINKS economists learn this, but I doubt that even 1 in 100 have ever actually done it aside from the most basic IRR hw problem in a managerial econ book. Agricultural economists still work out the nuts and bolts, but even at Davis, students would learn it working with an Extension economist, not in a classroom. Someday I would love to sit down w you representing an elite econ dept and I representing your unwashed state u cousin and have a real conversation about what the Hell our profession thinks our comparative advantage really is? My kid is going off to college and wants to study econ. I told him, yeah, it's a great major, I get that, but make it useful by taking accounting and finance too.
Regarding content creation, I think it is digital art value that plunges to zero. However I do believe that physical art -- paintings, sculptures, stage performances-- should still retain value. I think there should be sharper distinction between media art and the real. Same goes for the economy, that is, recognizing what is durable.
Perhaps MBA schools are looking for more macroeconomics. The economy is the economy and the government, via Keynesian spending is just one more factor, and a powerful one, which drives certain industries and certain geographies. As this is the new reality, perhaps these students will realize that rewards will be found by tapping into those areas, even if tangentially.
I think it is true that many administrators in colleges of business feel that economics has nothing to offer to managers in training. I had more than one Dean make slighting comments about our discipline. However, with some trepidation, I must disagree with you and them. I taught MBA students Managerial Economics for a number of years. When I started most texts were Intermediate Micro with an overview of regression and input-output. I didn't find that course very satisfactory and neither did the students. When I modified the course to include insights from the modern theories of the firm. That is make or buy decisions, incentives provided by different organizational structures, etc. My students valued that course as did I
One of the biggest mistakes American firms ever made was listening to economists insisting that all they had to do was maximize profits. In economic theory this is true. However, managements interpreted this as basing their decision-making solely on financial metrics. But a management isolated from their firm's production activities cannot make good decisions between internal investment and exterior purchasing. That's how much of American manufacturing ended up being performed in China.
DeLong on Farrell: "Aside from that, Mrs. Lincoln, how did you enjoy the play" :)
And on business schools: What other discipline teaches "econometrics" which firms can certainly use and probably do not use nearly enough compared to "the boss thinks ..."
Yes, Bryan Ferry and Co. Great! When you get time, see this one. https://www.youtube.com/watch?v=9zzDnAyD00E Arcade Fire, Rock en Seine 2007. Power Out + Rebellion. That whole concert, available on Youtube is worth watching. And this was well before the Suburbs.
3. Maximilian Grimm, Òscar Jordà, Moritz Schularick & Alan M. Taylor: Loose Monetary Policy and Financial Instability: Brad, haven't they changed the goalposts on what should be seen as a "loose" or a "tight" monetary policy? And are their goalposts correct or am I missing something? I thought inflation expectations (or a next-best inflation substitute) was the appropriate guidepost, not the gap between a current policy interest rate and (an unobservable) natural interest rate. Japan, for instance, could have a zero current policy interest rate, but that monetary stance would still be too restrictive (thus, tight) if deflation or its expectations were persistent. Likewise, Brazil could have a very high policy interest rate, but that policy would not be restrictive enough (thus, loose) if inflation and its expectations stayed persistently high. Scratching my head. My concern is that the analysis in this paper would/could lay the blame at the feet of monetary policy when the policy may be appropriate for the (inflation) circumstances and something else might be driving the risk-seeking behavior they document. Unless, the periods when r < r* matches with periods when inflation expectations are high and periods of r > r* matches with times when inflation expectations are subdued. In which case, why bother with the new goalposts and estimate (problematically) an r*?
On SubStack's Notes failure mode. I left Twitter for a reason and Notes doesn't seem to be giving me a reason to come back to a similar format. What I would have hoped for from Notes is the ability to follow respectful discussions between interesting writers, maybe with some ability to influence the content by suggesting topics, say.
On practical economics and benefit-cost analysis. Who even teaches this anymore? I agree everyone THINKS economists learn this, but I doubt that even 1 in 100 have ever actually done it aside from the most basic IRR hw problem in a managerial econ book. Agricultural economists still work out the nuts and bolts, but even at Davis, students would learn it working with an Extension economist, not in a classroom. Someday I would love to sit down w you representing an elite econ dept and I representing your unwashed state u cousin and have a real conversation about what the Hell our profession thinks our comparative advantage really is? My kid is going off to college and wants to study econ. I told him, yeah, it's a great major, I get that, but make it useful by taking accounting and finance too.
RE: One Video: Bryan Ferry, sounded a lot like "Canned Heat", for a trip in the way back machine here's - Let's Work Together https://www.youtube.com/watch?v=YavThhrC1ik
And for those who don't mind YouTube, here's a more recent sweet voice Gillian Welch - Pass You By
https://www.youtube.com/watch?v=A8S9VeYscQ4
Regarding content creation, I think it is digital art value that plunges to zero. However I do believe that physical art -- paintings, sculptures, stage performances-- should still retain value. I think there should be sharper distinction between media art and the real. Same goes for the economy, that is, recognizing what is durable.
Perhaps MBA schools are looking for more macroeconomics. The economy is the economy and the government, via Keynesian spending is just one more factor, and a powerful one, which drives certain industries and certain geographies. As this is the new reality, perhaps these students will realize that rewards will be found by tapping into those areas, even if tangentially.
I think it is true that many administrators in colleges of business feel that economics has nothing to offer to managers in training. I had more than one Dean make slighting comments about our discipline. However, with some trepidation, I must disagree with you and them. I taught MBA students Managerial Economics for a number of years. When I started most texts were Intermediate Micro with an overview of regression and input-output. I didn't find that course very satisfactory and neither did the students. When I modified the course to include insights from the modern theories of the firm. That is make or buy decisions, incentives provided by different organizational structures, etc. My students valued that course as did I
One of the biggest mistakes American firms ever made was listening to economists insisting that all they had to do was maximize profits. In economic theory this is true. However, managements interpreted this as basing their decision-making solely on financial metrics. But a management isolated from their firm's production activities cannot make good decisions between internal investment and exterior purchasing. That's how much of American manufacturing ended up being performed in China.
DeLong on Farrell: "Aside from that, Mrs. Lincoln, how did you enjoy the play" :)
And on business schools: What other discipline teaches "econometrics" which firms can certainly use and probably do not use nearly enough compared to "the boss thinks ..."
Yes, Bryan Ferry and Co. Great! When you get time, see this one. https://www.youtube.com/watch?v=9zzDnAyD00E Arcade Fire, Rock en Seine 2007. Power Out + Rebellion. That whole concert, available on Youtube is worth watching. And this was well before the Suburbs.
3. Maximilian Grimm, Òscar Jordà, Moritz Schularick & Alan M. Taylor: Loose Monetary Policy and Financial Instability: Brad, haven't they changed the goalposts on what should be seen as a "loose" or a "tight" monetary policy? And are their goalposts correct or am I missing something? I thought inflation expectations (or a next-best inflation substitute) was the appropriate guidepost, not the gap between a current policy interest rate and (an unobservable) natural interest rate. Japan, for instance, could have a zero current policy interest rate, but that monetary stance would still be too restrictive (thus, tight) if deflation or its expectations were persistent. Likewise, Brazil could have a very high policy interest rate, but that policy would not be restrictive enough (thus, loose) if inflation and its expectations stayed persistently high. Scratching my head. My concern is that the analysis in this paper would/could lay the blame at the feet of monetary policy when the policy may be appropriate for the (inflation) circumstances and something else might be driving the risk-seeking behavior they document. Unless, the periods when r < r* matches with periods when inflation expectations are high and periods of r > r* matches with times when inflation expectations are subdued. In which case, why bother with the new goalposts and estimate (problematically) an r*?