Comments on Richard Holden "Economic theories that have changed us: efficient markets and behavioural finance", 3/07/2015
You seem to say that both the efficient market theory and the behavioral finance they are backed by evidence. So how do you reconcile the two theories, if they have quite different implications? It is not right that two contradictory are both right?
Or this is similar to the wave and particles dual theory?
Showing posts with label economic thinking. Show all posts
Showing posts with label economic thinking. Show all posts
2015-07-04
Asymmetric information and public goods
Comments on Richard Holden "Economic theories that have changed us: asymmetric information", 3/07/2015
Asymmetric information is inevitable in reality, but appropriately providing public goods (social infrastructure) such as consumer protection laws as part of social infrastructure that can reduce the impact would be a more economical way to go.
Of course, it may take time to have relevant laws or regulations to be developed, particularly in developing countries.
Asymmetric information is inevitable in reality, but appropriately providing public goods (social infrastructure) such as consumer protection laws as part of social infrastructure that can reduce the impact would be a more economical way to go.
Of course, it may take time to have relevant laws or regulations to be developed, particularly in developing countries.
2012-02-07
Reward practical solutions to significant issues
Comments on Dick Smith's population award, 7/02/2012, see http://dicksmithpopulation.com/2010/08/11/wilberforce-award-announced/
This is my second time to visit this
page about this award and my urge has become stronger that the age
restriction would not be helpful to finding real and the best
solution to the population sustainability issue.
While it is clearly good to encourage
young people to think about it, the smaller feasibility area does
constraint the optimal results, unless the best result in the
unrestricted optimisation coincides with this smaller feasible area
optimisation.
If Mr Dick Smith is not only interested
in encouraging young talent but also in finding the best solutions,
then the award should not be restricted to young persons aged 30 or
below.
Having said that I would have to say
that Mr Smith's setting up a award for such a social and policy issue
is outstanding thinking and should be highly commended.
Australia will definitely be a better
place if more awards for solutions to important social and policy
issues, such as mitigation of floods and bush fire damages in
Australia, practical and optimal taxation and social welfare,
Indigenous education, health and economic participation, optimal
monetary and fiscal policies (i.e. why Australians have to pay so
high interest rates), why Australians have to pay so much higher
prices for virtually many things (i.e. the price differences between
here and that in the US)?
It would be nice to award practical
solutions and people who make outstanding contributions to practical
solutions to important social and policy issues.
Both the public sector (government) and
the private sector including private citizens should join such effort
to improve Australians' welfare and well beings.
The public services and bureaucrats
have their roles, but experience shows that many real constraints
(such as political, operational and organisational constraints) have
put a significant limit to their roles.
2010-05-07
Preferences - extreme contrast versus harmony
Comments on Andrew Elek “Strategic choices for APEC in 2010 and beyond”, 6/05/2010, http://www.eastasiaforum.org/2010/05/06/strategic-choices-for-apec-in-2010-and-beyond-2/
I have to confess from the outset that I am not familiar with the real niceties of the different schools of thought in regionalism, so I am not necessarily an enemy or a fried to any schools, although some of my former supervisors may feel disappointed in hearing this.
But I think that may not necessarily be shameful, because better progresses may be made when one takes all knowledge including being taught or heavily influenced by his teachers’ thoughts and still be able to analyse and approach issues with an independent mind. And the teachers should be proud of such students. An independent, not necessarily equally beautiful, mind for thinking should be welcomed.
Having said that, I find it extremely interesting to note that Elek's preference for the two extremes in the spectrum of his discussion over Bergstan's seemingly somewhat middle ground, unless I have profoundly misunderstood Elek's point.
For a layman to the different schools of thought like me, Bergstan's approach appears to be a mix of the advantages of the APEC and WTO. However, Elek is arguing that APEC members should go either what they have been doing or are used to do, that is, a loose and non legalistic approach to economic matters concerned to them and within them, or to the more difficulty WTO and legalistic enforceable approach, nothing should stand in the middle ground that might take the advantages of the two approaches and come to a compromise and suggesting a possible evolution of APEC business.
I assume it is the case that both the APEC way and the WTO way coexist and APEC members subscribe to both of them if they are also members of WTO. Then to me it is possible for them to also accept some compromises in between, unless of course their “preferences” are for extremes but harmony!
That is how I find Elek’s posting interesting, AND thought provoking.
I have to confess from the outset that I am not familiar with the real niceties of the different schools of thought in regionalism, so I am not necessarily an enemy or a fried to any schools, although some of my former supervisors may feel disappointed in hearing this.
But I think that may not necessarily be shameful, because better progresses may be made when one takes all knowledge including being taught or heavily influenced by his teachers’ thoughts and still be able to analyse and approach issues with an independent mind. And the teachers should be proud of such students. An independent, not necessarily equally beautiful, mind for thinking should be welcomed.
Having said that, I find it extremely interesting to note that Elek's preference for the two extremes in the spectrum of his discussion over Bergstan's seemingly somewhat middle ground, unless I have profoundly misunderstood Elek's point.
For a layman to the different schools of thought like me, Bergstan's approach appears to be a mix of the advantages of the APEC and WTO. However, Elek is arguing that APEC members should go either what they have been doing or are used to do, that is, a loose and non legalistic approach to economic matters concerned to them and within them, or to the more difficulty WTO and legalistic enforceable approach, nothing should stand in the middle ground that might take the advantages of the two approaches and come to a compromise and suggesting a possible evolution of APEC business.
I assume it is the case that both the APEC way and the WTO way coexist and APEC members subscribe to both of them if they are also members of WTO. Then to me it is possible for them to also accept some compromises in between, unless of course their “preferences” are for extremes but harmony!
That is how I find Elek’s posting interesting, AND thought provoking.
2009-07-30
A need for an effective world central bank
Comments on Suman Bery “The wisdom of Professor Calvo”, 30/07/2009, http://www.eastasiaforum.org/2009/07/30/the-wisdom-of-professor-calvo/
There seems a badly need for an effective world central bank.
Professor Calvo’s points, like the one on national international reserves, are profoundly thought provoking, particularly in the mist of what many countries are now worrying how to manage their international reserves to avoid potential losses if the US dollar devalues, due to its ever increasing budget deficits and government debts. One can have quite different perspectives for the same issues when looking in a different scope.
That is important in terms of thinking among competing “theories” for both economic or financial theorists and policy makers alike.
In addition to that, one might look at issues from an international perspective as opposed to a national perspective for managing the so called “sudden stop” of international capital inflow to a country. This would require a “world central bank”, an international last resort, to manage a sudden change in sentiments, similar like a run on a bank. It could provide emergence loans in whatever currencies to a country with reasonable prospects of success. Such loans can be quasi commercial, with reasonable interest rates.
The need for such a world central bank should be strong, because now international capital flow in and out of a country can be very large and the impact of a sudden change is very dramatic for most country to deal with along, simply because it is out of the capacity of any single country.
The Asia financial crisis in the late 1990s and the recent world financial crisis all prove the need for such a world central bank. The responses of some Asian countries following the Asia financial crisis was for individual countries to increase their international reserves and some attempts to establish an Asian regional financial institution with roles similar to those of the IMF with a focus on Asia. The latter is in the right direction, although the former has been said to have contributed to serious international imbalance.
Further, a private bank may be insolvent and bankrupt and be out of business forever, but a nation or country will stay in “business” forever, if you like. So it will have the ability to pay back any reasonable debts it incurs when in such emergence.
There seems a badly need for an effective world central bank.
Professor Calvo’s points, like the one on national international reserves, are profoundly thought provoking, particularly in the mist of what many countries are now worrying how to manage their international reserves to avoid potential losses if the US dollar devalues, due to its ever increasing budget deficits and government debts. One can have quite different perspectives for the same issues when looking in a different scope.
That is important in terms of thinking among competing “theories” for both economic or financial theorists and policy makers alike.
In addition to that, one might look at issues from an international perspective as opposed to a national perspective for managing the so called “sudden stop” of international capital inflow to a country. This would require a “world central bank”, an international last resort, to manage a sudden change in sentiments, similar like a run on a bank. It could provide emergence loans in whatever currencies to a country with reasonable prospects of success. Such loans can be quasi commercial, with reasonable interest rates.
The need for such a world central bank should be strong, because now international capital flow in and out of a country can be very large and the impact of a sudden change is very dramatic for most country to deal with along, simply because it is out of the capacity of any single country.
The Asia financial crisis in the late 1990s and the recent world financial crisis all prove the need for such a world central bank. The responses of some Asian countries following the Asia financial crisis was for individual countries to increase their international reserves and some attempts to establish an Asian regional financial institution with roles similar to those of the IMF with a focus on Asia. The latter is in the right direction, although the former has been said to have contributed to serious international imbalance.
Further, a private bank may be insolvent and bankrupt and be out of business forever, but a nation or country will stay in “business” forever, if you like. So it will have the ability to pay back any reasonable debts it incurs when in such emergence.
Subscribe to:
Posts (Atom)
Posts
