Poverty and inheritance

There’s an old Pelican on my shelves, [amazon_link id=”0804614679″ target=”_blank” ]The Economics of Inheritance[/amazon_link] by Josiah Wedgwood, nicely musty and yellowed. It was first published in 1929; I have the revised 1939 edition.

[amazon_image id=”0804614679″ link=”true” target=”_blank” size=”medium” ]The economics of inheritance,[/amazon_image]

It begins with a discussion of poverty and inequality, including this section.

“Material welfare has no significance except in its relations to men’s feelings and as one element in the psychological state called happiness. And the extent of a man’s happiness depends on the number and intensity of the desires which he is able to satisfy relative to he number and intensity of those which he is not able to satisfy. For this reason, certain religious teachers have striven to achieve happiness by eliminating all desires save those which they believed were capable of complete and permanent satisfaction. By contrast, in the search for material welfare, our modern civilisation under conditions of industrial progress is continually manufacturing new and previously unwanted sources of pleasure, so that old luxuries become new necessities, alike for those who can and cannot afford them. …

“`Though the amount of good and services enjoyed by the poor man in 1924 may be enormously greater than those enjoyed by his predecessor in 1824, the former’s poverty is probably little less tedious and unpleasant to him than an actually more grinding poverty was to the latter.”

There is a very thoughtful review of Julia Unwin’s book [amazon_link id=”1907994165″ target=”_blank” ]Why Fight Poverty?[/amazon_link] on 3am Magazine by the philosopher Richard Marshall (he reviews the whole Perspectives series). Lee Crawfurd also reviews Unwin’s book and takes issue with the idea of relative poverty, expressed above by Josiah Wedgwood.

[amazon_image id=”1907994165″ link=”true” target=”_blank” size=”medium” ]Why Fight Poverty? (Perspectives)[/amazon_image]

Incidentally, I’m pleased to see OUP is bringing out a collection of Richard Marshall’s essays, [amazon_link id=”0199969531″ target=”_blank” ]Philosophy at 3:am[/amazon_link] very soon.

[amazon_image id=”0199969531″ link=”true” target=”_blank” size=”medium” ]Philosophy at 3:AM: Questions and Answers with 25 Top Philosophers[/amazon_image]

As for Josiah Wedgwood, the second half of his book recommends inheritance tax (at 60% or so) and a gift tax, as well as progressive income tax. He wrote: “The ethical arguments in favour of claims to inherit… are extraordinarily weak.” Parents should support their children to give them a good start until they reach adulthood. He rejects the idea of any right to bequeath property. It’s a radical read in today’s climate – but that’s why we have a new gilded class. Like so many others, I’m keen to read Thomas Piketty’s [amazon_link id=”067443000X” target=”_blank” ]Capital in the 21st Century[/amazon_link].

[amazon_image id=”067443000X” link=”true” target=”_blank” size=”medium” ]Capital in the Twenty-First Century[/amazon_image]

GDP and all that jazz

Tyler Cowen has reviewed my new book, [amazon_link id=”0691156794″ target=”_blank” ]GDP: A Brief but Affectionate History[/amazon_link] for the Washington Post – favourably, I’m relieved to say, as he’s such an astute reader. I’m halfway through the other book he covers, Zachary Karabell’s [amazon_link id=”1451651201″ target=”_blank” ]The Leading Indicators: A Short History of the Numbers that Rule Our World[/amazon_link]; and will be reviewing that myself in due course.

[amazon_image id=”0691156794″ link=”true” target=”_blank” size=”medium” ]GDP: A Brief but Affectionate History: A Brief Affectionate History[/amazon_image]   [amazon_image id=”1451651201″ link=”true” target=”_blank” size=”medium” ]The Leading Indicators: A Short History of the Numbers That Rule Our World[/amazon_image]

There are surprisingly few books about GDP, but two came out soon after I submitted my manuscript, very different from each other (and mine). One is [amazon_link id=”1780322720″ target=”_blank” ]Gross Domestic Problem [/amazon_link]by Lorenzo Fioramonti – self-explanatory. Here is my take. The other is [amazon_link id=”019976719X” target=”_blank” ]Beyond GDP: Measuring Welfare and Assessing Sustainability[/amazon_link] by Marc Fleurbaey and Didier Blanchet which is far more technical but well worthwhile if you’re interested in the issues – here’s my review. Its introduction covers the argument of the book in a non-technical way.

[amazon_image id=”019976719X” link=”true” target=”_blank” size=”medium” ]Beyond GDP: Measuring Welfare and Assessing Sustainability[/amazon_image]

Macroeconomics – a pile of tsundoku?

The in-pile is suddenly teeteringly large  – thanks to Bookshelf Porn, I now have the japanese word tsundoku:

Thank goodness for a lot of travel coming up.

One that just arrived and is very tantalising is [amazon_link id=”0262019736″ target=”_blank” ]Big Ideas in Macroeconomics: A non-technical view[/amazon_link], by Kartik Athreay, flagged up to me by a comment on this blog. Regular readers will know that I’m a macro-sceptic, so it will do me good to read what looks like a sympathetic account of modern macro. Noah Smith has blogged about the book already, and my prior is that I’ll agree with him, although Herb Gintis has a friendly quote on the back cover. Naturally I’ll keep an open mind!

[amazon_image id=”0262019736″ link=”true” target=”_blank” size=”medium” ]Big Ideas in Macroeconomics: A Nontechnical View[/amazon_image]

The borrower from Hell

A book has arrived that will probably have to wait until my summer holiday, or at least Easter, but it has me mightily intrigued. It’s [amazon_link id=”0691151490″ target=”_blank” ]Lending to the Borrower from Hell: Debt, Taxes and Default in the Age of Philip II[/amazon_link], by Mauricio Drelichman and Hans-Joachim Voth.

[amazon_image id=”0691151490″ link=”true” target=”_blank” size=”medium” ]Lending to the Borrower from Hell: Debt, Taxes, and Default in the Age of Philip II (The Princeton Economic History of the Western World)[/amazon_image]

I know, I know. But if I’d not quixotically decided to apply to study Philosophy, Politics and Economics at Oxford (to further my ambition of spending my life being a philosopher like [amazon_link id=”0007203942″ target=”_blank” ]Simone de Beauvoir[/amazon_link] in a Parisian cafe), and if I hadn’t got in, and if I’d not had a brilliant economics tutor in Peter Sinclair and so ended up being an economist, I would have done a history degree instead. At school we studied 16th and 17th century Europe – these were the days before British schools only taught the Tudors and the Nazis – and what times they were! [amazon_link id=”0099439832″ target=”_blank” ]Q[/amazon_link] by the Italian writing collective Luther Blisset gives a good flavour of it.

And as the intro to this book points out, in extraordinary times like 2008 and its aftermath, the long history of debt and default might hold useful lessons. Economists in general should pay more attention to economic history. History should be reintroduced as a requirement in all Econ PhD courses – I benefited greatly from courses by Barry Eichengreen and Steve Marglin in mine, possibly grumbling at the time, but young people don’t entirely know what’s good for them.

[amazon_image id=”0099439832″ link=”true” target=”_blank” size=”medium” ]Q[/amazon_image]

I’ve read the first three pages of [amazon_link id=”0691151490″ target=”_blank” ]The Borrower from Hell[/amazon_link] and am going to have to tear myself away….

Economists and our responsibilities to society

Do social scientists (including economists) have a responsibility to engage in public debate? Yes, said Nicholas Kristof in the New York Times. Academics have become too marginalised and – with honourable exceptions – he said: “Ph.D. programs have fostered a culture that glorifies arcane unintelligibility while disdaining impact and audience.”

Paul Krugman weighed in specifically on economics: “In my field there is indeed a problem with abstruseness, with the many academics who never even try to put their thoughts in plain language.” He concluded that economists who can’t explain what they’re doing probably don’t understand what they’re doing. Krugman supports the use of mathematical models but – echoing many great economists of the past like Marshall and F.Y. Edgeworth – argues that what we always call ‘intuition’, or non-mathematical explanation, matters too.

I like Edgeworth’s analogy best: the maths is like the scaffolding essential for putting up a building. You have to have it, and you have to take it down at the end.

Of course I agree with the general point that academics – especially social scientists! – have to engage with society. Not just engage with as in discuss one’s research in intelligible language, but understand how academic research and teaching interact with society, influence it and are influenced by it. (This was the theme of my 2012 Tanner Lectures, The Public Responsibilities of the Economist (link near the bottom of the page), which looked at the role of economics in the formation of modern financial markets, among other things.)

In the UK, this issue is now described by the shorthand of ‘impact’, with universities required to demonstrate their impact as part of the 2014 Research Excellence Framework, which will determine the allocation of funding. I’m playing a small role in the assessment exercise.

What impact do economists and other social scientists actually have? Is it by being ‘public intellectuals’? Or are there more ‘impactful’ channels? I’ve been reading a very interesting new book, [amazon_link id=”1446275108″ target=”_blank” ]The Impact of the Social Sciences: How academics and their research make a difference[/amazon_link], by Simon Bastow, Patrick Dunleavy and Jane Tinkler.

[amazon_image id=”1446275108″ link=”true” target=”_blank” size=”medium” ]The Impact of the Social Sciences: How Academics and their Research Make a Difference[/amazon_image]

It analyses in some detail evidence from data collected on hundreds of UK-based social scientists and researchers in the ‘STEM’ subjects (science, technology, engineering and maths). The first surprise is how many more students and researchers (and funding) there are in STEM subjects than the social sciences, which in turn dwarf the humanities and the creative arts and design: in the UK, the STEM subjects get 80% of total research funding, social sciences 14%, humanities 4% and creative arts 2%. Student and staff numbers are slightly less skewed, but the figures still make one doubt the often-made (by scientists) claim that STEM needs more.

On the impact question, the book argues that the tide has begun to turn on the inward-looking shift in academia, and on disciplinary silos which , the books says, were ‘concreted in’ by the late 1960s. This must be a good thing. What’s the point of fabulous climate science research if social scientists are not fully engaged in analysing how society might or might not change? Surely scientists – and research funders –  do appreciate that people do not necessarily believe what they’re told by academics? Trust in scientists and researchers is high but that isn’t the same as accepting them as legitimate decision-takers.

Using the data set on academics’ channels of influence built for the research, the book assesses the character of the ‘outputs’ of the academics (which varies quite a lot between disciplines) and looks at two arguments about academics’ impact. One is that there are ‘popularisers’ who can communicate but do little valuable research, and academics of course tend to sneer at this group. Another is that there are superstars who do the best research and are brilliant communicators. The truth is in between – most of the group are middling at both research output and public communication.

In general, though, social science research has a big influence on government, think tanks, civil society and business. The book traces many channels of engagement. The area where there is perhaps less influence – certainly less than the natural sciences – is in the media and social media. If Nicholas Kristof thinks the US lacks public intellectuals, he should feel sorry for the UK: the book suggests Stephen Fry as our leading public intellectual at least in terms of number of Twitter followers – a brilliant polymath but not a social science academic. Academics, in my experience, are often either reluctant to engage with the media (for several valid reasons such as time, deadlines, simplification…); or lack understanding of the conventions and constraints.

One example of highly effective collaboration cited here is the Great British Class Survey, between an academic team of sociologists and the BBC. There was huge public engagement and interest internationally, and it was a successful ‘co-production’ of social science between academics and the public. But no doubt there are some academics who see this as excessive popularisation.

The book ends with a discussion of what the authors call a ‘dynamic knowledge inventory’, a constantly updating repository of our current understanding of society. They commend ‘broad front’ social science and integrating social science with the STEM disciplines. I like the quotation from [amazon_link id=”0571270123″ target=”_blank” ]Tom Stoppard[/amazon_link] in the final chapter: “I don’t think writers are sacred but words are. They deserve respect. If you get the right ones in the right order, you might nudge the world a little.”

[amazon_image id=”0571270123″ link=”true” target=”_blank” size=”medium” ]The Real Thing[/amazon_image]

The LSE website link to the podcast of the launch event is broken but there are some slides available here.

Update: podcast link is here.