Economics & Marginalia: May 13, 2022

Hi all,

Ok everyone, it’s clear where your time should go today. After five (loooong) years, during which his music became the soundtrack of one of the most important social movements of the century, Kendrick Lamar’s new album dropped today and you cannot start listening too soon. Within the first 90 seconds of kicking off, it’s apparent that his writer’s block has been definitively defeated, and this is another classic. It’s also surprising, even for him: Beth Gibbons is on it! In case you needed distractions today (and it’s definitely been that kind of week, with UK politics descending to new levels of stupid every day), you’re welcome; and if rap isn’t your thing, then there’s some economics too.

1. Stefan’s new book is doing the rounds, and as a result, he’s popping up in media we’re not used to seeing him in: first on twitter and now on a podcast. He talks with the FT’s Africa Editor, Dave Pilling here on the Rachman Review (transcript), and it’s very good. Pilling pushes him, at one point suggesting that his development bargains theory might itself be elitist, denying agency to most of the country; and Stefan, perhaps controversially given his long-time role in one of the largest aid providers in the world, says: “Aid has become a very small part of development in general. Aid for most countries in the world has actually not been a big force for change.” He qualifies this, but it’s clear that in his view, aid is a small part of the solution for development. In fact, there is much about the book that challenges common notions about how we think about and do development. I wrote about four of these challenges here.
2. Inflation is in the news and in my bank account, behaving like Pac-Man; Penny Goldberg, whom we should always listen to, suggests that fighting it requires we re-embrace openness, free trade and globalisation. She is right. Resilience doesn’t come from hoarding your resources, but by getting as many people as possible to commit to exchanging them to diversify your risks, increasing the chances that idiosyncratic shocks in one part of the network aren’t affecting all the rest, even at the risk of contagion. Also on Project Syndicate, Dani Rodrik takes a different tack, suggesting that hyperglobalisation is to be left behind, and something better could rise from its ashes.
3. Very nice Tim Harford piece on the importance of those parts of the economy we can’t see or touch. He’s dead right about the corrosive effect of the lack of trust in Hong Kong. I grew up there, and the change in the last three to five years has been dramatic and tragic.
4. Stephen Bush has an interesting piece on why democracies struggle to innovate through experimentation and exit from failed experiments, but I think it paints far too rosy a view of experimentation as a source of policy. It’s not just that many experiments don’t replicate, which he alludes to early on; nor even that some things simply can’t be experimented with for ethical or practical reasons. The problem he elides, endemic to every Government I’ve worked in or with, is that we have actually quite limited capacity to carefully define exactly which problems we want to solve, nor on what terms we would judge success or failure. It might be obvious that an employment policy should reduce unemployment, but think slightly deeper and it gets more complex. Do we care over what time horizon it works? Do we care only about the level of unemployment, and not its distribution? How do we think about trade-offs in welfare across different groups. We often know better policy when we see it, but that doesn’t help us design experiments ex ante.
5. Closely-related: a really nice discussion by David McKenzie of a section of Chris Blattman’s Why We Fight, about why there is so little genuine policy experimentation, and why ideas usually start big and only iron out little kinks, even when a complete junking of them might be better. McKenzie goes through a number of reasons why, in his experience, this is difficult, but the most powerful is this: “It can be really hard to say ‘give me money and let me tinker for a while.’”
6. Nice write-up of new work by Jenny Aker and Kelsey Jack (both great researchers) which shows that information alone is enough to help dramatically improve uptake of a welfare-improve agricultural technology. I’m usually sceptical of information-only interventions, so it’s nice to see one proven.
7. Kendrick isn’t the only hotly anticipated new release that dropped this week: I also managed to see Dr. Strange in the Multiverse of Madness, and with no spoilers let me just say, thank god they let Sam Raimi cook. There are callbacks to the Evil Dead, the first genuinely creepy moment I’ve seen in a Marvel movie and a proper villain. Raimi last exited the Marvel world in a riot of glorious idiocy, but  Dr. Strange also reminds us he was responsible for probably the greatest scene in the whole genre, too. And, if like me you cannot get enough of superhero movies (someone suggested they’re like Westerns—a once dominant genre that died out, as these will too. That’s fine. I love Westerns too), this Ringer piece suggesting the perfect place to drop an F-bomb in every PG Marvel movie is for you.

Have a great weekend, everyone!

R