Economics - General Sandpit September 12, 2016 John Quiggin125 Comments A new sandpit for long side discussions, conspiracy theories, idees fixes and so on. Share this:TwitterFacebookLike this:Like Loading... Related
125 thoughts on “Sandpit”
In other words – Support your claims or admit you were wrong, ikon.
I agree Ikon/Crazy Horse does not know how to grok women. He is very impressed with individual women particularly those who can do maths and stuff like that but the rest of us are just background noise.
He patronises me unmercifully but I let it go over my head. I’m pretty sure that ee is doing the best he can with the old fashioned networks of associations – his priors – that inform his ability to even start to consider how women could fit into the great scheme of ordering the universe/world/phase space.
My PhD supervisor knew he was sexist and he accepted the benefits of having women on his team so he was motivated to try hard to be not sexist. We – at a lab meeting one week – worked it out that to be not-sexist he needed to rearrange pretty much all of his current neuronal structures that led to the judgements he made about things that involved women and real life as apart from looking after children.
And Paul … none of us see the whole truth; that is why we need diversity and to talk to each other. We are creating truth right now between and among the chattering class.
“the examination a Clinton candidacy is not to do with sexism (except for morons), but an effort to understand whether she is a candidate likely to run America on rationality alone, without fear or favour,”
Sheesh, that is a stupid question isn’t it? Did you expect rationality alone from any of the previous male applicants for president? Did you ever ask for it from them?
It’s interesting Julie –
According to Paul only morons are influenced by sexism
Yet less than 10% of the American legislature are female
How do we reconcile this? Does Paul think the majority of Anericans are morons? Not that long ago less than 10% of the Australian legislature were female, and not all that long ago none were, and not all that long before that women couldn’t even vote.
Were all men morons then?
Maybe instead of thinking in terms of morons, it would be useful if people like Paul and Ikon could accept that sexism, including structural sexism, exists, and think about how it could be overcome. One can hope.
I thought I was being supportive but apparently I patronise unmercifully. I apologise. You should have said something so that I would desist. I certainly will now.
I’ll take the easy one first, your 93.
True, I am neither H.C. nor JG. But it is also true that none of the people involved in the discussion in question is H.C. or J.G.
I think Paul is uncomfortable with the squabbling going on – as he sees it, fixing sexist attitudes is a lesser issue and distracts from the main game which is pointing out the faults of right wing thinking – and lots of people would like not to talk or think about the very complex issue of how women can be as free to choose as men are.
I think that the economics of childbearing has to be the starting point for a real ideology – I think it was one of Ikon’s favourite go to references, John Ralston Saul who said that neither capitalism or socialism are proper ideologies; they are just methods of organising how money is distributed or something like that.
Any ‘real’ ideology is going to have to explicitly explain the economic status of a new life and who pays.
Why did you think I needed support? Do you do that for the men who comment here?
Well, thank you Julie Thomas.
Now I am free to concur with your accurate comment that use value should precede exchange value: that the status of women and their children becomes a factor more important than the conceit, greed and arbitrary imperiousness of a petty princeling like John Stumpf, for example.
Sorry about the “mercilessly” 😦 I was venturing into creative writing there and I really did appreciate your support way back in the beginning when we had so many of those crazy libertarians who had no manners or respect for anyone.
Being as supportive as you were was one of the reasons I identify as left wing whatever that means these days and it seems to mean a difference between people who
accept as a fact that all people are basically good and will fit in with their group given sufficient opportunities to become that sort of person and the others who can’t see that would ever work.
I don’t understand what reasons do they have for arguing that people are fundamentally biased toward behaving badly.
More on Clinton from a a US FB friend, who wouldn’t vote for Trump in a snow storm; an insiders view and heavens to betsy, a woman.
Note, the writer is NOT a Trump fan, but reiterates just one or two of the many concerns I feel that others find risible:
In reply to your 92.
1. Divergence of owners’ and managers’ objective. The Fisher separation theorem states that the interests of owners and managers are separable in the sense that if managers of joint stock companies maximise shareholders’ wealth then the shareholders can allocate their wealth according to their preferences.
2. Max NPV. Where does one get the numbers from to put into the formula?  If the market were complete, then one could deduce the numbers from the prices.
3. Corporate finance and the problem of divergence of owners and managers objective: Incentivice managers to act in the interest of owners by making them owners (give them equity at zero price or equity options, KPI criteria). Outcome: CEO ‘remunerations’ up, share prices down. …… GFC. Problem: It is actually very difficult to design incentive compatible mechanisms.
4. Corporate finance, management incentives and ‘riks’. Initially call options written on equity were advocated (makes sense intuitively, maybe, but is not necessarily incentive compatible because the value of options is a positive function of the variability of the price of equity. Variability of equity prices can be influenced through the management’s decision on how much debt is taken on).
5. Some years before the GFC, some finance academics advocated issuing put options to management to encourage risk taking. Think about this one (1)
6. More on corporate finance: ‘Market for corporate control’. Another ‘market’ solution approach followed in response to the divergence of interests between owners and managers: If, so the argument goes, managers do not act in the interest of shareholders (not maximise value), then they face the risk of a take over. They call this ‘the market for corporate control’. You and I may reason differently – why would the next lot of managers (those of the acquiring corporation) not simply increase the value of the corporation by say $1 and take $0.99 for themselves. How? reduce the headcount (their terminology for number of employees).
Enough for today? (Oh, maybe you want to know how a more than 70 page paper, still quoted primarily in the accounting literature, rests on one error. How does one pick it? If the paper is on the reading list and one has only limited time to prepare for the lecture – one looks for the jagular – no?)
 On a practical level, the numbers can be approximated for very small scale and short term projects by using current market prices and knowing that if the numbers turn out to be wrong, only a negligible small segment of ‘the economy’ fails. But not for large scale long term projects this doesn’t work.
Incentivice (?) I think it takes an s in the second last spot. I want to say: Provide an incentive.
Bother. Please make all the obvious corrections in the text (eg the last sentence, (1) instead of (?), etc.
Exactly. There is no feasible way to get even a 1/1000th good President in the USA. They are all horrendously corrupt. This won’t end well.
Paul, that link was emotional gibberish. I despair. Maybe in the same way that Australia had to elect Tony Abbott to realise just how bad he was, America will have to elect Trump to see how bad he is. But in the meantime, inequality will continue to increase and the world will roll on towards a climate catastrophe. I’m not a doom-sayer, I’m normally an optimistic person, but I can no longer cope with all this.
If you or anyone else thinks that electing Donald Trump is the same as electing Hillary Clinton, you are in the grip of a delusion and there is nothing I can say to you. Policy actually means something – the platforms parties or candidates put out tell you what they plan to do. I absolutely urge you, read the policies of the two candidates before you comment again.
Three and a half years years ago, I tried to tell people on this blog that their continued unbalanced criticisms of Julia Gillard were not helping the Labor party and were helping Tony Abbott. Then in 2013, the Abbott government was elected and the key reason was that Labor was perceived as chaotic and disunited.
Now I am seeing a similar thing re the USA elections – people who feel such a strong need to attack the female candidate that they entirely distort the true picture and pave the way for Trump. It’s watching a slow motion train wreck all over again. I try to reason with people, I make emotional appeals, I lose my temper – none of it makes a difference.
My only hope is that there are enough sensible people in the USA to see that Trump is a genuine serious threat to the future of a socially or ecologically sustainable society, and that the best way to counter him, at this time, is to vote Clinton, imperfect as she undoubtedly is.
When you see people heading into disaster, you have to warn them, but in the end if they won’t listen, you can’t stop them. Trump would be a disaster.
Emotional gibberish indeed, Val, but unequivocally believed and supported by Ikono, and maybe even Paul. I do not understand how this situation arises, or why Ikono, who as we both acknowledge can be very reasonable, should believe this arrant nonsense with such implacable hostility to a modestly capable and modestly flawed, individual.
In fact Bill Clinton is more of what Ikono objects to than ever Hillary was, is, or will be, and he was POTUS for 8 years and neither America nor the world, suffered major collapse or even damage. Nor did the USA make war on Iraq as it had under Bill’s predecessor and as it did again under Bill’s successor. You’d be tempted to think that maybe that fact should have some importance, but no, all it seems to do is to confirm indubitably that Hillary is a “a neoliberal warmongering corporate crony“.
I confess that I think if America elected Trump, it would merely be well merited ‘poetic justice’ (Obamacare would be killed off very quickly, for instance), but like a lot of people, I don’t think I’d ever like to see the nuclear codes in the hands of Trump. Having one set of them in the hands of Putin is bad enough – he’s no Kruschev by any stretch – but even Putin comes across as way more sane than Trump.
At least you didn’t use ‘incentivation’.
Yes, quite enough for today, though I am pleased that the groking is proceeding. However, I will have to let it reverberate around in the echo chamber inside my skull for a while.
But thank you so far – very interesting.
Incidentally, the problem of “management incentivisation” was a major topic for Peter Drucker (of being sacked as consultant at General Motors by Alfred P Sloan, and also of Management By Objectives, fame), so I’ll see if I can just have a quick read of his pronouncements – my vague recall is that he tackled some of the issues you’ve raised.
Val, you and your fellow leftists have only yourselves to blame, both for the rise of Trump and the apparent uptick in misogyny. I think Lionel Shiver said it best:
The whole article is worth reading.
Pleasure. Reading your posts, those by Ikon and Paul Walter, and of course JQ’s will hopefully improve my rather atrophied vocabulary – never been a great novel reader. I am getting the idea of groking and grok, I believe. Love JQ’s headers – more often than not they contain the kernal of the subject matter of the thread.
“Implacable hostility” – that’s the expression I was looking for. It was the same for Julia Gillard as for Hillary Clinton. There was no balance or reason, no weighing up their positive or negative qualities – just a fixed determination to see the worst in them. I’ve puzzled over it, but I don’t really understand it – it does seem driven by emotion though, and the accusing others of being blinded, etc, does seem like projection. Anyway enough said.
Hmm. Can’t say I’ve actually thought of you vocabulary as “atrophied”, it’s always seemed more than adequate to the interlocution task at hand.
Nor am I much of a novel reader nowadays either. Nor am I much of a Robert Heinlein fan – his writing, in general, was far too simplistically libertarian for mine (eg Starship Trooper). But Stranger in a Strange Land came out in 1961 and it sort of became a ‘cult classic’ for a while. For mine, it was basically ‘groking’ – terrible word but powerful meaning – that stuck in my mind. Though I think the element of 1960s “sexual revolution” was what endeared it to many at the time.
In the meantime, I am just beginning to take notice of the differences between ‘systemic incompetence’ (eg ‘incomplete market’ and/or ‘imperfect competition’) and ‘individual incompetence’ (eg the kind of stunted decision making that led to Masters and Dick Smith). And I do still look at “Chainsaw Al” Dunlap as a prime example of ‘management incentivisation’ – especially during his stint at Kerry Packer’s empire (1991 – 1993 I believe) where his skills at reducing headcount were very amply demonstrated. Supposedly he had ‘mentored’ James Packer in London in the late 1980s before his Consolidated Press gig.
I presume I’m to blame for misogyny in the same way a victim of domestic violence is to blame for domestic violence, right?
We’re not behaving the way you think we should, so we deserve to be punished.
I am implacably hostile to f a s c i s t s. I make no apology for that. There is a misconception that because a politician faces domestic democratic election, he or she cannot be a f a s c i s t. This neglects assessments of actions towards people outside his or her polity. Minister Dutton is a f a s c i s t towards refugees placed in Australia’s Pacific gulags. The US political establishment is f a s c i s t towards peoples of the M.E. Bush, Obama, H. Clinton, B. Clinton and D. Trump, to name a few, all exhibit f a s c i s t aspects towrds non-US citizens and indeed US citizens now. Just witness the bipartisan support for the Patriot Act. If some people actually understood these realities they would not get their politics, including their gender politics, so seriously mangled as to call a man sexist for critcising a female f a s c i s t (while never saying “boo” when male f a s c i s t s) are criticised. The misandrous double standard is blatant and appalling.
Note: I have to space one word to avoid auto censorship.
Ikon – what was Kevin Rudd then? He considerably worsened the Labor party’s position on refugees and off shore detention, but I’ve never heard you criticise him in the way you criticised Gillard.
I’ve never heard you criticise Barack Obama in the way you criticise Hillary Clinton either.