RE: why Iraq? here's one theory
Interesting. A Neo-Marxist Conspiracy Theory, from an economist's perspective, "It's all about OIL(Euro's)." My degree is in Political Science, with an emphasis on International Relations. What we learn in the Social Sciences is that things tend to be "over-determined," many not one cause. I think the conflict with Iraq falls within this description. I am sure that economics plays SOME role, but not the dominant role. I would posit that Saddam Hussein's actions since 1980 provide all the justification necessary for apprehension and care necessary, by his neighbors and the United States, without recourse to discussions of "Langley and Washington" and geo-strategic analyses of oil. His invasions of Iran and Kuwayt suggest the Ba'athist regime in Baghdad is an expansionist one. The continued flouting of UN Resolutions suggests that the belligerence of the regime has not abated. We might debate the merits of preemptive action, on moral andpractical grounds, butI do not think it is necessary to advance a "Big Finance-Big Oil" basis to for discussion or opposition. To me, it seems, this is merely "No Blood For Oil" tarted up in academese. It is a non-starter when chanted on a street corner and it isn't much more convincing when advanced in a news group. "1. The Real but Unspoken Reasons for the Iraq WarW. Clark ([EMAIL PROTECTED]), 10:36pm Fri Jan 31 '03 (Modified on 10:39pm Fri Jan 31 '03)Although completely suppressed in the U.S. media, the answer to the Iraq enigma is simple yet shocking. The upcoming war in Iraq is actually an OIL CURRENCY war. The Real Reason for this upcoming war is this administration's goal of preventing further OPEC momentum towards the euro as an oil transaction currency standard. However, in order to pre-empt OPEC, they need to gain geo-strategic control of Iraq along with its 2nd largest proven oil reserves. (This is a long essay)The Real Reasons for the Upcoming War with Iraq: A Macroeconomic and Geostrategic Analysis of the Unspoken Truth"
Re: income and substitution effect
So far we have that i. and s. effects are useful to a) teach Marshallian demand b) teach difference between nominal and real income c) students going on to graduate school d) useful but for reasons that can't be remembered! :) e) useful as a hurdle/signal f) not useful at the intermediate/mba level Regarding Marshallian demand this is true but just raises the question what is the use of Marshallian demand at an intermediate level? (Note almost all textbooks discuss i. and s. effects but most do not teach M. demand.) As I said in my post, for welfare analysis, income and substitution effects become important but this is not taught at the I. level. I don't see how i. and s. effects teach nominal and real income but am willing to be enlightened. c) is possible but it means that teaching i. and s. effects is a waste for most students. Surely there are enough useful things to teach that are also difficult? thus i. and s. effects is not needed for the hurdle. Thus the bulk of the posts, and a number I have received offlist, increase in my mind the hypothesis that this material is a waste of time (relative to other things that could be taught). Alex -- Alexander Tabarrok Department of Economics, MSN 1D3 George Mason University Fairfax, VA, 22030 Tel. 703-993-2314 Web Page: http://mason.gmu.edu/~atabarro/ and Director of Research The Independent Institute 100 Swan Way Oakland, CA, 94621 Tel. 510-632-1366
Re: Cost benefit analysis
Depends on what you mean by used in making policy. As far as I know there are no decisions which are based solely on cost-benefit analysis. Budgeting is done by legislatures so if CBA plays any role there it is in influencing the decisions of legislators. CBA is most commonly used in making regulatory decisions. Even there it is seldom the only criteria, but it is common for regulators and those contesting NPRMs (notice of proposed rule making) to present CBAs. - - Bill Dickens William T. Dickens The Brookings Institution 1775 Massachusetts Avenue, NW Washington, DC 20036 Phone: (202) 797-6113 FAX: (202) 797-6181 E-MAIL: [EMAIL PROTECTED] AOL IM: wtdickens [EMAIL PROTECTED] 02/11/03 11:15PM Does anyone know how often CBA is actually used in making policy? What percent of the federal budget (or state or local) has been determined by CBA? Cyril Morong
Re: income and substitution effect
I'm not disagreeing, but I am curious: what would you teach instead? __ Do you Yahoo!? Yahoo! Shopping - Send Flowers for Valentine's Day http://shopping.yahoo.com
Re: income and substitution effect
knowing what i and s effects are all about teaches people to evaluate which types of tax cuts will entail higher production - and which types of tax cuts will do the reverse... jacob braestrup danish taxpayers association So far we have that i. and s. effects are useful to a) teach Marshallian demand b) teach difference between nominal and real income c) students going on to graduate school d) useful but for reasons that can't be remembered! :) e) useful as a hurdle/signal f) not useful at the intermediate/mba level Regarding Marshallian demand this is true but just raises the question what is the use of Marshallian demand at an intermediate level? (Note almost all textbooks discuss i. and s. effects but most do not teach M. demand.) As I said in my post, for welfare analysis, income and substitution effects become important but this is not taught at the I. level. I don't see how i. and s. effects teach nominal and real income but am willing to be enlightened. c) is possible but it means that teaching i. and s. effects is a waste for most students. Surely there are enough useful things to teach that are also difficult? thus i. and s. effects is not needed for the hurdle. Thus the bulk of the posts, and a number I have received offlist, increase in my mind the hypothesis that this material is a waste of time (relative to other things that could be taught). Alex -- Alexander Tabarrok Department of Economics, MSN 1D3 George Mason University Fairfax, VA, 22030 Tel. 703-993-2314 Web Page: http://mason.gmu.edu/~atabarro/ and Director of Research The Independent Institute 100 Swan Way Oakland, CA, 94621 Tel. 510-632-1366 -- NeoMail - Webmail
Re: income and substitution effect
I do agree that one of the few applications of i. and s. effects is to labor supply (this was mentioned in my first post). (This is because labor is one of the few goods where the income effect is likely to be large.) Hence that is the context in which I teach the material. It is appalling, therefore, that most textbooks teach i. and s. effects early on and leave labor supply to an entirely different part of the text. Bill, do you really mean to say that you think that Giffen goods are a real phenomena???! Even the classic, Irish potato famine has much better explanations (e.g. Rosen recent JPE) than in terms of Giffen goods. As to what to teach instead there are many choices e.g. most intermediate classes don't cover the Coase theorem or any law and economics, finance is another topic that could be taught more at the i. level. Alex -- Alexander Tabarrok Department of Economics, MSN 1D3 George Mason University Fairfax, VA, 22030 Tel. 703-993-2314 Web Page: http://mason.gmu.edu/~atabarro/ and Director of Research The Independent Institute 100 Swan Way Oakland, CA, 94621 Tel. 510-632-1366
Re: Fw: why Iraq? here's one theory
On Tue, Feb 11, 2003 at 10:34:40PM -0500, William Dickens wrote: Should OPEC set oil prices in Euros and hold their cash reserves in Euros what would be the real consequences for the US? 1. A tiny increase in risk wrt oil prices (we know its tiny because the cost of currency hedging is minimal). 2. A tiny loss of income for the Fed from being able to print cash and create reserves as cash is repatriated and foreign banks accounts in dollars are reduced. 3. Some tendency for the dollar to depreciate which can be completely offset by slower money growth (this and 2 are really the same thing). Perhaps slightly more foreign exchange risk for companies doing business with countries that cease to peg to the dollar. Is it possible for another government to manipulate the US dollar in a way that the Fed can't effectively counteract? OPEC switching to Euros may not do it, but is it vulnerable in general? Have there been cases in the past where countries tried to destablize the currency of others on purpose?
Re: income and substitution effect
Hi Alex, I cannot point with conviction to any example of a Giffen consumption good and I don't consider it to be a very important consideration. My claim was not that any demand curves _do_ slope up, but that you want your students to know that it is a logical possibility and what is required for it to be true if for no other reason than to innoculate them against arguments that they may later here that assume only income effects. Also, I always make a point of mentioning Veblen goods since I do think that that is a real (though not very important) phenomena. I always found that if I didn't mention Veblen goods someone in the class would always raise the issue of snob appeal. When I taught principles I would always integrate policy relevant examples into all my discussions and not wait to the end of the course to cover topics. For every concept I would give them a real world application of it. For is I did labor supply and income taxes. - - Bill William T. Dickens The Brookings Institution 1775 Massachusetts Avenue, NW Washington, DC 20036 Phone: (202) 797-6113 FAX: (202) 797-6181 E-MAIL: [EMAIL PROTECTED] AOL IM: wtdickens [EMAIL PROTECTED] 02/12/03 12:36PM I do agree that one of the few applications of i. and s. effects is to labor supply (this was mentioned in my first post). (This is because labor is one of the few goods where the income effect is likely to be large.) Hence that is the context in which I teach the material. It is appalling, therefore, that most textbooks teach i. and s. effects early on and leave labor supply to an entirely different part of the text. Bill, do you really mean to say that you think that Giffen goods are a real phenomena???! Even the classic, Irish potato famine has much better explanations (e.g. Rosen recent JPE) than in terms of Giffen goods. As to what to teach instead there are many choices e.g. most intermediate classes don't cover the Coase theorem or any law and economics, finance is another topic that could be taught more at the i. level. Alex -- Alexander Tabarrok Department of Economics, MSN 1D3 George Mason University Fairfax, VA, 22030 Tel. 703-993-2314 Web Page: http://mason.gmu.edu/~atabarro/ and Director of Research The Independent Institute 100 Swan Way Oakland, CA, 94621 Tel. 510-632-1366
