Double Standard

I guess it's my day to rant and rave, but I couldn't stop myself when bumping onto today's BBC Greek story. I'd like to turn your attention to BBC's informative graph above, which beautifully illustrates that in fact, Greece leads the EU countries with largest percentage of debt out of GDP ... (drum roll please) second only to Italy. Why is then Greece and not Italy getting the ironic "preferential treatment" in the press these days? What's so special about Greece that isn't happening in Italy? Or Spain & Portugal for that matter? Why not treat them as a unit, as the PIGS* they truly are?

*PIGS = Portugal, Italy, Greece and Spain

Census in Wonderland

As soon as I eyed the bright, clear white envelope from the 2010 Census, I rushed upstairs, tore it open and hardly contained my enthusiasm to find out what all the commotion has been about. Everyone seems dissatisfied these days and there is an inexhaustible amount of opportunities to aim this discontent at the government. Here comes the Census and before even officially having been distributed, there are already outcries far and large how race-intensively the questions are molded. I couldn't help but wonder, how did they know???

 'Tis true. There is no denying it, nevertheless I felt excited to make my tiny contribution to the population census as I do believe in the principle wholeheartedly. I filled out the shiny bluish pages with a trembling hand focusing really hard not to make a silly mistake in my DOB or to misspell my name. In less than three minutes, it was all over and I sighed proudly with a sense of accomplishment such as after a long, standardized test.

Then it hit me. Oh, no! Who's going to count me in the Bulgarian Census (the next one is to be expected next year, I presume, as the last one was in 2001) when I'm not there? The blessing and the curse of having dual citizenship strike again. Well, there's nothing I can do now. I can only hope that my poor grandmother can figure out how to add us to the official record for I do not wish to be reduced to nothing. I'd much rather be a mere statistic than a nonexistent one.

Does anyone know how such questions are settled? Is the brain drain data overly exaggerated or on the contrary, quite understated? Alice understood the situation all too well: "'But it's no use now,' thought poor Alice, 'to pretend to be two people! Why, there's hardly enough of me left to make one respectable person!'"

The World of Fab.

I have been under the weather for too long so I decided to blog of something fab (for a change). I cursed myself for having forgotten to take a pen and paper (yes, I still take notes the old school way unlike you tech-savvy gurus out there) during this mind-opening lecture I attended last week. To no avail, I forcefully tried to take mental notes as I was outlining this post in my head. I have fallen behind on memory exercising and my brain is failing me today. Or perhaps it can be attributed to the weather once again or to the caffeine withdrawals I've been suffering from lately.

Anyhow, enough about me. Turning into a phenomenon slightly more Fab than myself, namely the Labs! I'll leave for you to convince yourself of the useful and innovative (although innovation is a tricky word as the creator himself, Dr. Gershenfeld, admitted) Fab Labs. Unfortunately, the program's website is still very much in progress and the wiki page is too short, but to be honest, grasping the concept is not that challenging. With the lecture hall packed to the fullest capacity with an audience ranging from toddlers to senior citizens, the overwhelming majority were information-hungry young and old adults looking for the next big thing.

I know for myself I had many questions during the Q&A session, and after the session ended, I was left with many others. Sure, there can be no clear cut solution even when answers were given in the most eloquent, evidence-full and parallel-rich manner. Needless to say, my biggest worry is how to get these labs started. It still seems that after the tough step of overcoming financial hurdles, the rest comes naturally and easy. There is no dispute over the benefits of education in all shapes and forms (and the need for education reform, but that is the topic of another blog post). Yet when underdeveloped, still backward in terms of industrialization pattern countries are faced with the question how to move beyond the backwardness and make progress a reality, there is a divide among policy makers whether to finance innovation and focus their reforms on building human capital AND/OR to let the same old catching up, conditional convergence Solow story take care of the development gaps in order to provide a sound foundation for all sectors to improve upon. According to the Fab team, gaps can be jumped over and overcome. That is their huge, central idea. But there remains the need for a broad educational and state reform and for a type of micro financing that in turn remains unattainable to most developing countries on a larger scale. And it is this larger scale debate that remains the main critic of the team. For now, economies of scale are not Fab Lab’s concern. They try to promote the acquisition of skills to build (almost) anything you won’t be able to find in the store. Cleverly, these skills are similar to if not the same as those used to create the things that are available to the mass consumer. In a sense, education bridges the gaps between developing and developed nations. In fact, many of the developed nations we often point as examples are hardly any more developed as a whole than the rest of the world they are compared to.

The question I end with today will not be how to get started and get the entire globe involved in this completely worthwhile project, but when? When will policy makers start moving in the right direction where there is no need to define space and boundaries, where accreditation of awarded degrees is not based on a single location where the studying took place, but on achievement, where innovation happens limitless in terms of resources, communication and worldwide engagement?

Let's Talk Politics

Shifting alliances among parties in a multiparty system: one of the main causes of political and social instability.

Examples include but are not limited to South and South-Eastern Europe (since Bulgaria and Italy are my favorite case studies). I have often doubted the efficiency of the bipartisan system, however, could the US be on the right track?

Comparative vs. Absolute

After four difficult years, I can finally say I understand comparative advantage. I don't mean simple calculations or the basic concept behind the fancy technical term. Well, I do mean both, but what I mean to stress is that I understand it. I might just pop up open that bottle of champagne I've been saving for special occasions. Or just have a glass of cold water to wake me up from my temporary excitement and get me started on yet another problem set nearing its deadline. Either one will do.

I can't be certain if it was me falling asleep in the majority of classes, or the way professors try to explain things and often fail, or both, but I am finding out only now that I have confused Smith and Ricardo's absolute and comparative advantage up to this very moment. Who knew that absolute is absolute and comparative is based on comparison?! OK, enough silliness, but as obvious it is to most of you, the notion that by flipping a fraction, the comparative advantage pattern will be reversed holds true every single time (unless the fractions are equal, duh!) had not crossed my mind!!

Full credit and my deep gratitude goes to my online textbook resource (since I refuse to buy actual Econ textbooks anymore) that got me through the basics of my Master's International Trade and the current International Economics classes. Sadly, I took the former before the latter and thought that after passing the more difficult one, I'd dance my way through the other. I couldn't have been more wrong...

The Games People Play

Read this, read this, read it!!!

I.T., a friend at MIT, casually sent me the article, adding that one of the main reasons why he enjoys economics is that this particular field of study toys with people through experiments. In my mind's eye emerged the image of a puppet show - a marionette guided by two giant hands - and I could not help but share my fears with him. I told him that economic policies often serve the interests of few and thus, inequality is brewed. From inequality spur jealousy, violence, conflicts and instability. Envy is not a deadly sin for nothing.

Then I was reminded of a recent discussion on inequality and how it was time to change my stubborn attitude towards the phenomenon. While some level of inequality and unequal distribution of income is required for growth, too much of it most likely creates more problems than solutions. One must keep an open mind when it comes to social policies, but remain focused on the goal of encouraging investment and entrepreneur opportunities.

"You never know what policy is going to be effective for what group of people," my friend elaborated. And this is what I find most curious (and frustrating, sure) about economics. A single policy has so many variables for all of which it is impossible to control, so many possible and hardly foreseeable outcomes. Case studies can be helpful and we can learn from past mistakes, but who knows if the same economic theory can apply universally without catastrophic consequences.

I suppose this is where sociology and psychology come in handy. Or as my friend cleverly pointed out, "The more you know about people, the easier it is to manipulate them."

Thought for Food

Sarkozy at Davos for video, and the full text of the speech here.