Economics – Page 18

Private Information or (and?) Local Thinking during the Housing Bubble

A few weeks ago I came across a research paper named “Wall Street and the Housing Bubble” by Cheng, Raina and Xiong (2012). I found it while I was reading the always-interesting (and diverse) blog “Nada es Gratis”. In here, you can find (in spanish) a thorough synopsis of what the article is about. The paper analyzes whether the experts in securitization were aware of the housing bubbles and the possibility of the collapse of housing prices in the US. Namely, they test the “Inside Job” view, popularized by the film of the same name which held the view (among other things) that insiders were aware of the financial bubble during 2004-2006 and its inner workings. At first glance their results are at least thought-provoking.

Continue reading “Private Information or (and?) Local Thinking during the Housing Bubble”

How (not) to explain the stability of marriage with economic models.

The last couple of months we have been breathing, eating, sleeping and dreaming of Economics. Very quickly words and phrases such as optimization, consistency, “my function of studying has a negative first derivation since monday”, “there is no Nash equilibrium in our restaurant choices” entered our every day communication. Most popular Google searches and old bookmarks were replaced by blogs about econometrics and game theory, and reading the news came down to skipping to the Economics and Finance section. There was nothing to complain about, as Bukowski put it “if you are going to try, go all the way”, and there was no other way to do a Masters in Economics. But when it came down to economic models trying to explain love, I was not going to give in so easily.

For Economics followers, the Nobel Prize in Economics is a bit of an Oscar’s. Continue reading “How (not) to explain the stability of marriage with economic models.”

Some Death Ought to Jump-Start the Economy

Some thoughts on the course: The Rise of the Global Economy taken in the first term as part of the International Trade, Finance and Development (ITFD) program.

How much of economic history stretching from hunter gather to modern day financial crisis can one really learn in five weeks? As it turns out, one can learn rather a lot. As anyone who braved Pro Voth’s course will tell you, economic growth as we know it is a very recent phenomenon. Up until before the Industrial Revolution, economic growth had remained stagnant for hundreds of years. This is a thought that should fester when considering that during the lifetime of the likes of Leonardo da Vinci, Galileo, Gutenberg etc. incomes and living standards remained essentially unchanged. As such, The Rise of the Global Economy set out to answer the questions: when did growth occur, why did it take so long, what finally caused it and what did we do with it.

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How High Will You Get If Marijuana Is Freely Available?

Marijuana Consumption Among International Students In Amsterdam

Kelvin Ong

Adapted from a simple observational study done by Herrmann, Ong and Piovesan (2009). Available upon request.

It might surprise many that Cambodia and North Korea are the trailblazers when it comes to liberalizing pot laws, and while many European states have already loosened or are loosening their pot laws in response to changing social mindsets and ineffective drug policies, the United States is just beginning to follow suit, with the electorate of Colorado and Washington voting to legalize marijuana consumption without a doctor’s recommendation. They are joining California, who since 1996 have already begun liberalizing their pot laws. Continue reading “How High Will You Get If Marijuana Is Freely Available?”

A Quick Overview of Thailand

Kelvin Ong

Written in Thailand 2011, adapted from devac.org

Thailand has a rich history spanning nearly 800 years now, and throughout this time, it has never been colonised by a Western nation, which is unique among Southeast Asian countries. Thailand has the second largest economy of Southeast Asia, after Indonesia, and it has historically enjoyedhigh rates of growth, at least before and after the currency crisis of 1997. Its industrial sectors contributes 43.9% of GDP, coming in second-most important after its services sector, which accounts for 44.7% of GDP.

The past decade has been full of challenges for Thailand. The tsunami of 2004 has destroyed parts of it, taking many lives and property, and throughout 2008-09, the political unrest due to bickering political factions in its capital Bangkok has adversely affected the tourism industry (which makes up 6% of its GDP). Later in the decade, the avian flu crisis that affected Southeast Asia did not spare Thailand. However, it’s economy is still sustaining its growth at a good rate.