Surviving ‘post-truth’

Yesterday I took part in an IdeaFactory session at the annual OECD Forum titled: ‘A Survivor’s Guide to a Post-Truth World’. The jury is out on whether experts (including economists) are going to be survivors, even after the session I think. As ever, though, it was fascinating, the discussion in our breakout group, really making me think above all about my personal actions: do I make enough of an effort to listen to people whose views I disagree with? or enough of an effort to overcome confirmation bias when I read things online? Another message I took away was to think about the relationship between online debate and face-to-face interaction, and the role of physical social and family networks. For example, if there are subjects on which we disagree with people close to us IRL that we can’t discuss, how on earth is that debate supposed to happen in any public forum?

Anyway, plenty of interesting books were mentioned. Matthew D’Ancona, one of three recent books called Post Truth (the others are by Evan Davis and by James Ball) was a speaker. (His point was that there’s nothing new about the production of lies but the consumption possibilities and behaviours have changed.) So was Brian Cathcart, co-author of Everybody’s Hacked Off (and once a colleague of mine), and philosopher Vincent Henricks, co-author of Infostorms. Other titles mentioned – ones I’d not heard of – were Joi Ito’s Whiplash and Joshua Cooper Ramo’s The Seventh Sense. Oh, and Durkheim came up in conversation. All round, plenty to think about.


Bringing back welfare economics

I recently read a 2001 paper by the late, missed, Tony Atkinson, The Strange Disappearance of Welfare Economics. He wrote: “Despite the prevalence of welfare statements in modern economics, we are no long subjecting them to critical analysis.” And he’s right. Economics, macro and micro, is stuffed with statements about ‘optimality’. The article continues: “One cannot help noting the sharp contrast to [an] example used in a 1930s discussion of welfare criteria: the repeal of the Corn Laws, where conflicting interests are central to the analysis. A representative agent model would indeed have appeared extraordinary to classical economists.” One cannot help noting, either, that if (macro)economics had not disembowelled itself of the ability to focus on conflicts of interest, we as a discipline would have paid more attention to the consequences of globalisation and technical change since 1980. But that takes us into counterfactual history territory.

It’s with some smugness that I’ve read (in the recent past, not in my millennium ago student days) the three key books on welfare economics cited in Atkinson’s article: Will Baumol‘s Welfare Economics and the Theory of the State, J de V Graaff‘s Theoretical Welfare Economics and IMD Little’s A Critique of Welfare Economics. The Baumol is the most recent, updated in 1965. I got that from the library store, the Graaff second hand online and the Little was donated to me by Andrew Sentance, who said it was mouldering in his garage so I could have it.

Sixteen year’s after Atkinson’s article, it’s time for economists to look seriously at welfare economics again. It affects everything from environmental policy (discounting the future??) to macro (budget rules, optimal saving….) to national income accounts (my pet obsession – any aggregation has an implicit set of ethical assumptions).


Live long and prosper – economists and Vulcans

I’ve very much enjoyed Manu Saadia’s Trekonomics: The Economics of Star Trek. Many economists are fans of science fiction, detective fiction, or both (as I long ago described here) and I’ve long been a fan of Mr Spock, indeed posting this sticker in the front of my copy of Theil’s Principles of Econometrics. Paul Krugman made a similar link in his well-known account of being drawn to economics by Isaac Asimov’s Foundation series.

IMG_4148Trekonomics joins Star Trek: The Human Frontier by Michele and Duncan Barrett as an excellent book about what the franchise says about society. It’s an interesting, enjoyable riff about the economics of the series: the implications of abundance, what work means, the absence of money, the implications of the replicator. I most enjoyed a rant about the anti-humanism of Paul Ehrlich’s 1968 The Population Bomb (and besides, it was completely wrong), and a section about the psychology of people in a society where there is no poverty, and no inequality of access to material resources (reputation and Star Fleet rank being another matter). There is also a chapter about the tragedy of the commons which might well turn up in my teaching next semester. This is a problem not even the wise and benign Federation can solve.

Manu Saadia argues that the calm and rationality of Vulcans, and indeed the humans in later series of Star Trek, are hard for 21st century humans to empathise with. We don’t care about these perfect characters, he writes. Maybe it’s because I’m an economist, but it’s Spock, not Kirk or any of the humans, who is my hero. The Vulcan greeting could be an economist’s motto.

Live long and prosper!


Things and Beyond

I’ve been reading Frank Trentmann’s Empire of Things: How We Became a World of Consumers, from the 15th century to the 21st, which has taken a while as it’s 600+ pages. It has been an enjoyable read but with two flaws – more on these later.

The book does what it says in the subtitle, drawing on a major research programme, and is truly impressive in its scope and detail. It traces global (and genuinely so although with a strong tilt to the West) trends in consumption through the long sweep of history. It links these trends in behaviour to trends in thought about personal and social ethics, and the individual in the family and in society. It addresses the entire chain of production and consumption from resources to waste. It draws on a wide array of disciplinary knowledge, including philosophy, history, sociology and even some economics.

The book sets up a tension through all of this material: “The view that being and having are opposites … has a very long history. But so has an alternative trajectory that sees people as only becoming human through the use of things.” Among other forces, technology keeps this tension alive over time, as new things keep on appearing. And it’s interesting to see that certain things are particularly compelling – stockings for one. The 17th century knitting framemade better, cheaper stockings possible, and the early national accountant Gregory King estimated in 1688 that 10 million pairs a year were purchased. This reminded me of the tidal wave of nylon stockings sold by Dupont – 800,000 pairs on 15 May 1940, the first day of sale, alone.

Consumption clearly depended on rising incomes, and the book traces a switch to “the creation of value through consumption, not just production” from the 19th century – it argues that consumer society has its roots in the Industrial Revolution rather than as is often argued the post-war boom. There’s an interesting couple of sections – in the light of the way technology is currently blurring the previously sharp consumption/production divide – on the role of consumer durables. I disagree with Trentmann’s suggestion that, “The appeal of goods such as the automatic washing machine was far from self-evident.” He notes that the aggregate time spent on household work was not reduced significantly by such consumer durables – and then observes in passing and ignores the class distinctions. Middle class women were decreasingly likely to have servants and did more of their own housework. Working class women – like my mother and Hans Rosling’s – were truly given hours of time by automatic washing machines. John Kenneth Galbraith (I’m sure he never did an iota of laundry in his life) said consumer durables enslaved women; but even if – as he argued – easier washing meant more washing to have cleaner clothes, why is this not a better outcome?

Turning back to that original tension – does our relationship with things dehumanize us or the opposite? Is consumerism basically bad or good? – I’m with Hume. As Trentmann describes the Humean view: “An encounter with a new object was one way in which intelligence and feeling were inspired and strengthened.” (And isn’t this one of the big questions about AI and consciousness – can intelligences without sense perceptions become conscious?)

The modern no-growther’s disdain for consumption seems to me to be of a piece with the instinct in the past that gave us sumptuary laws. Rich folk thought poor folk should stay in their place, dressing up the restrictions on the purchases the masses were allowed to make in moralising garb. But as Adam Smith put it, it was, “[T]he highest impertinence and presumption for kings and ministers to watch over the economy of private people, and to restrain their expense, either by sumptuary laws, or by prohibiting the importation of foreign luxuries. They are themselves always, and without any exceptions, the greatest spendthrifts in society.” Of course we need to pay far greater attention to resource use and to waste, but it is the affluent who are cavalier about the importance of growing real incomes and consumption – Janan Ganesh in his column today describes them as ‘too-rich-to-care bohemians’.

There is lots to enjoy in Empire of Things, therefore; I’m exactly the kind of reader who likes detail of the sort its pages are packed with.

I would have liked more economics, and more figures. There is a nice section on the mutual interaction of prices and tastes, as with the switch in British taste from coffee to tea in the later 1700s: a chart of tea and coffee prices would have been nice. But I have two bigger criticisms. One is that the book seriously needed an edit. The argument gets swamped in detail and it should have been 25% shorter. Some sections, especially those on non-western trends, fall between two stools – insufficiently detailed in themselves but enough to distract from the flow.

The biggest issue I have, however, is that the book never addresses the distinction between material and non-material consumption. It puts really a great deal of emphasis on the physical nature of consumer goods – and then skips to a discussion of some non-material aspect of consumption such as public health measures or public education, or leisure activities like the cinema. The issue of increased expenditure on services and intangibles is dismissed in just over two separate pages (out of 690), by saying that spending on housing, transport and food combined accounts for the same proportion of the household budget in 2007 as in 1958; and that in the OECD as a whole material consumption rhas continued to rise. Yet people are spending a growing proportion of their incomes on warmth, space, travel, variety, quality, entertainment as they grow richer. The immaterial is embedded in the material, and there is absolutely no reason to be complacent about the environmental footpring of the global economy; but (even knowing I may be biased about this) it is surely a significant development in the history of consumption (albeit a transition of affluence) that value is being created largely by the non-material now? (The forthcoming Capitalism without Capital by Jonathan Haskel and Stian Westlake addresses this.)

Still, it’s probably a good sign when a huge book leaves you more inclined to ask for more rather than wishing there had been less, and the balance tips that way for me despite it being in need of a blue pencil in parts.






Autumn books

I’ve already posted about the new season catalogue from Princeton University Press. Now the Harvard and MIT presses have sent their tantalising autumn/winter catalogues. Harvard is offering A Century of Wealth in America by Edward Wolff; Eli Cook on The Pricing of Progress: Economic Indicators and the Capitalization of American Life (this really looks my kind of book); and Giacomo Corneo’s Is Capitalism Obsolete? A Journey Through Alternative Economic Systems.

At MIT Press, The Chinese Typewriter by Thomas S Mullaney (“how Chinese characters triumphed over the QWERTY keyboard and laid the foundation for China’s information technology successes today”) looks tempting. I’m intrigued also by Robot-Proof: Higher Education in the Age of Artificial Intelligence by Joseph E. Aoun; and Once Upon an Algorithm: How Stories Explain Computing by Martin Erwig. (“How Hansel and Gretel, Sherlock Holmes, the movie Groundhog Day, Harry Potter, and other familiar stories illustrate the concepts of computing.”)

As it’s been one of those busy periods when I buy books because it allows me to fantasize about long, idle days sitting in the sunshine reading (hah!) (and I just spent three days at the Hay on Wye book festival), people really need to stop publishing interesting new titles for a while so I can catch up.