Request for requests

What do you wish to hear about?  I know I haven’t finished all of your older requests, but I surveyed them a bit yesterday and I thought that perhaps the list has evolved since April.

Comments

I would love to hear some of your thoughts on how systems can be put into place that would better align the incentives of management and shareholders with regard to the balance between short term profits and long term appreciation. Thanks.

How come no prominent politicians carved out the underutilized political resource of opposing TARP?

I think it is great that Obama's economic advisors know a lot about the "Great Depression", but I wonder how many similarities there really are with the current situation. In particular, I believe that the quantity, quality, and timeliness of information is radically different now than it was then. I don't know how that will affect the situation, but the most obvious is some sort of over-correction. I'm also interested in whether or not we are heading into a new economic era, one dominated by baby boomer's retiring on what is left of their investments, selling more houses than they buy, and generally slowing down their spending. What sort of growth rates will we have after the stock/housing wealth effects disappear...

Assuming the economy begins to mend next year or so, what is the optimal exit strategy for all those TARP investments?

The role and future of intelligent agent modeling in economics.

What would your Wife Swap family look like?

How can we construct better incentives for more accurate assessment and reporting of financial risks?

1. What is the effect of a recession on the art market? Of course prices drop for established artists, but do buyers look for deals on good art from new artists? Are good young artists more likely "discovered" during an economic boom or an economic bust?

2. Are you signed up to be cryogenically frozen after your death? If not, why not?

Do we have any examples in history that are similar to what a failure of G.M. would look like? Do we know what happens when a company that large fails? If we've never seen anything like that before, how do we know what the effects would be?

Economic growth and the Middle ages and what this has to say for us now.

I've read a few pieces suggesting that the roles of IMF and Worldbank may be undergoing some pretty major changes. I'd love to hear your take on that situation as well as any other planned changes to finance at the global level. What exactly came of that big meeting a month or so ago, for example? I recall The Economist was pretty upbeat about progress being made, but they didn't really go into detail.

What are the costs associated with pegging one currency with another? Especially, which part of the society benefits and which suffers if the country pegging the currency is a net importer. For example, Nepal pegs its currency with India's at 1 INR = 1.6 NPR. It probably cannot maintain that peg just by fiat. What policies must Nepal employ to maintain that peg?

Any links to articles analyzing the monetary policies of countries that peg their currencies (such as Hong Kong, Ecuador) would also be appreciated.

How politicians meddle in the mortgage market.

National right to work law.

Free trade agreement with Colombia.

How to protect against massive inflation.

Are there any fun family games that boost awareness of economics?

Demographic change has led to smaller household sizes over the past years. Is there any reason to worry that these trends are easily reversible and will reverse, thus exacerbating problems in the real estate markets?

1) The level of math required in graduate econ programs. I know it's been covered somewhat but it would be interesting to delve into what effect the emphasis placed on real analysis on topology requirements will have on the people that do economic research in 5-10 years. Are economic thinkers that lack a tad in math preparation being overlooked? What percentage of academics will always ask themselves the question "How does my paper affect policy issues and what real life implications does it have?" How many times are research subjects chosen by young economists because it's likely to help get tenure or simply look good on a CV (i.e. signalling technical ability)?

2) Data availability. How much is macro research hampered by the fact that available macro data covers maybe 2 great recessions and a few mild ones with a high proportion coming from a fixed exchange rate period in a wildly different economy? In other words, how much of an advantage is the higher frequency of financial data (stocks, fixed income, FX) with intraday data compared to quarterly/annual points in macro? For instance, PPP calculations seem to need 60+ years of data to render the long term determinants of trade that the model is supposed to detect.

3) A detailed post on the Iceland case. Not just the often repeated "oversized banking system" point but what measures coul have been taken, by whom, when was it past the point of no return, etc. Banks as profit-maximizing firms don't look down the road five years to see if their speedy growth which is profitable now will become a problem then. If you were to know ex-ante that the system (central bank reserves) won't keep up with the banks and the lender of last resort function won't work, do banking agents deter growth? What public policy tools can be used (size of the economy as an indicator of the efficiency of regulators?) to analyze the case?

Design the perfect ponzi scheme to scam your friends and neighbors of $50 billion. How long could you keep it going?

More directed readings of classic economic texts, as you are doing now with Keynes. How about one of the Austrians next time?

Since you seem to be one of the few skeptics on the effectiveness of fiscal policy, I would like to see a follow-up on that.

Also, what do you think of Arnold Kling's idea that mortgage securitization would never have survived in a free market? I may have missed it, but I haven't seen other people comment on this.

Having been recently diagnosed with cancer at the age of 29, I'm interested to hear anything you have to say about:

- healthcare and the way insurance companies work.
- cancer rates/probabilities and treatment success stories.
- cancer related to nutrition (I've been doing alot of reading on this lately and wondering why our dairy industry has been allowed to exist as such for so long).

I would like to hear you discuss the likely movement of the dollar. Do we want it to get stronger (to make our debts more bearable) or do we want it to get weaker (to help our trade deficit)? More interestingly, how much power do you think the U.S. government/Treasury/Federal Reserve have to affect the strength of the dollar?

Happy Holidays to all MR readers!

Cuban Embargo.
Hurts or helps us from an ECONOMIC perspective?

What's the practical difference between a repo and a secured loan? Aren't all these repos just postponing the inevitable?

Are you an inflationista or a deflationista?

An explanation of the neutrality of money vs. deflationary spiral contradiction. I still don't get why some form of monetary policy can't tackle deflation? Econ 101 tells you that governments that try to pay off debt by printing money get inflation, which sounds resonable.

How come the fed can't do some of that when the threat of deflation increases? If there isn't legislation that allows a version of it then pass a bill. Even if regulator's attempt to increase money in circulation gets clogged up in banks, doesn't that imply a free lunch for the banking system? As I see the current argument, if the fed were to print 100 USD and "give" it to Citi, then Citi would just hold on to it and it would stop there without boosting anything. But if you give more money and to more banks then the incentive must be for the banks to get it out there? The "gift" vs. loan argument obviously comes in to play but there must be ways around that?

What do you think of the work of Amartya Sen?

Should I go to Recife Brazil, or Buenos Aires for the period Feb 2009 - May 2009?

Your (revised) views on the global savings glut.

I've heard a number of people say things l like the net effect on GDP of our continued use of our broken customary system is about $1 trillion/year (the accumulated cost of things like lost revenue due to not using the system of measurement used by the rest of the world, conversion errors (lost space probes, over purchase of carbon credits and medical errors by congress for example), extra labeling and just the time lost due to having to do conversions all the time).

I'd be quite interested in your thoughts on the effect on our economy and the recovery from our current situation.

If you could provide a nice little compare and contrast bit on experimental and behavioral economics, I would read a good portion of the post.

@Paul

I can answer your question - Buenos Aires. My pal got his 'chute when Bear went down and he's made a nice soft landing in between some Latin starlets and a couple of French students, if his Facebook pix aren't totally Photoshopped. Srsly. BsAs is incredible now. I know a few people who went there and just never come back.

I would like to glom onto the currency pegging question. The Iceland case remains fascinating as well.

Labor costs comparison/contrast in US/EU with regard to immigration seems like a still ripe topic if interesting variables can be isolated.

I would like to hear about the middle east economy. After the oil melt down, some of those countries are having real issues: what can we expect? What are the economic aspects of some of the (sorry) dumb policies (S. Arabia waiving women as workers is one example). Many thanks!

How about a round-up recommendations list of the best/most important currently-applicable books on development economics, accessible to the layperson? Could just be Amazon links and a sentence or two about why each is good and/or important.

Regarding Krugman's unconvincing criticism of "overhang theory," why can't overhand theory and Keynes be compatible? Overleverage followed by a liquidity crisis.

More generally, why is there an aversion in economics to real causes in favor of analysis in terms of accounting identities? Or can accounting identities say anything about the real economy?

I think there might be one question in there.

Financially, the more I look at Australia, the more I like it. Low debt, modern financial systems, highly educated population and a supplier of goods to ever-growing China. What am I missing? What's their future look like to you?

What are your thoughts on a single, global currency? Will it ever come into existence, and would it be a good or a bad thing if it did?

I was going to ask this some months ago, but never got round to it. It seems all the more relevant today.

Micro seems to be largely settled, amongst economists, as to its major assumptions and conclusions. (aside from behavioural results that are hard to replicate outside the lab)

Macro on the other hand seems to be subject to much hostile debate. Clearly since the 'rescue' and 'stimulus' debates this has come to the fore, but to this lay-observer it has always been thus.

I can think of 3 explanations:
1. Rational behaviour assumptions often work, but often do not, confirmation bias keeps us thinking its okay, harder to do with country wide data

2. Micro results can be quickly and accurately measured, with macro there is just too much noise to actually measure things

3. Governments and media want macro theory, and are willing to pay for it until it meets their ends, micro on the other hand is not (quite) so open to manipulation.

If my whole premise is wrong, I'm sure you will correct me.

What's the deal with oil prices? What do you think of this:

http://www.energybulletin.net/node/47523

What do you think Milton Friedman would recommend as far as government and federal reserve policy in our current environment?

Ken

Has there been a Tyler and Alex fundamental worldview post? It might help explain what each sees as blogworthy, and in the myriad of opinions they express.

Sure, readers can try to piece it together by themselves, but errors are likely. Might as well lay it out for us to see.

That being said, I'd love to get the same from those moderate democrat economists, too.

Are there limits to the US's debt load?

Even given the financial meltdown and recession, is there still a "global savings glut"? What are the implications if Americans begin to contribute more meaningfully to global savings?

I read in 2007 about complexity and sand piles (from Mark Buchanan discussed in a John Mauldin email). How would you shape monetary and fiscal policy to avoid devastating critical states? Would it even be possible or desirable to "shake the sandpile"?

Simple question (with fun intro...):

In my view, the success of biology has been based on a dedication to often painful, often misleading, empirical research: experiments and data-gathering.

Is is possible or desirable that economics enter a phase in which there is a lot of data-gathering?

(I apologize for essentially making the same point in my response to the agent-based modeling post...)

Mark

Apart from teaching duties, how should the optimal number and quality of a unversity department's faculty be chosen? What economics tell us about this question?

In regard to your earlier post:
"We're in a race to see whether politics will become the dominant means of allocating financial wealth in this country. That could be the single biggest domestic issue today, but too few economists are speaking up about it."

We will always argue about how to redistribute wealth, but that may become a secondary consideration if GDP falters for long. I am more interested in factors affecting the rate of growth of aggregate wealth, and whether the regulatory environment can affect it in positive ways. Can you comment on the models of Ireland and New Zealand in regard to that question? Are there policy implications in regard to subsidizing certain kinds of businesses vs. others? Is this in fact the main reason for deregulation? Who is doing the most work in this area?

why is it so difficult to find scientific information on child learning/development on the web?

The monetarists believe that central bank can prevent depressions by providing liquidity. The keynesians believe the same can be done by fiscal stimulus. It seems to me that both will be tried in this experiment of global size. What if they are both wrong? How will that change macro-economics and where would you look for a new hypothesis?

Additionally, if I've understood correctly, government spending is taken as an exogenous variable in the basic macro calculus. But if the depression is world wide and all governments use stimulus, it cannot be an external variable, right? How does that affect the economic calculus? Could it be that Keynesian approach actually does have an effect in a local case, in which there is capital that can be imported from elsewhere, but not in the global case?

You once threatened a post on the contribution of Sraffa to economics. And how about Marx?

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