Friday, 20 April 2007

Stiglitz on China and Rogoff on Wolfowitz

There are two recent and interesting Project Syndicate articles by Joe Stiglitz and Ken Rogoff.


China’s New Economic Model

China’s success since it began its transition to a market economy has been based on adaptable strategies and policies: as each set of problems are solved, new problems arise, for which new policies and strategies must be devised. This process includes social innovation. China recognized that it could not simply transfer economic institutions that had worked in other countries; at the least, what succeeded elsewhere had to be adapted to the unique problems confronting China.

As China moves away from export-led growth, it will have to look for new sources of dynamism in its growing entrepreneurial ranks, which requires a commitment to creating an independent innovation system. China has long invested heavily in higher education and technology; now it is striving to create world-class institutions.

Too many people think of economics as a zero-sum game, and that China’s success is coming at the expense of the rest of the world. Yes, China’s rapid growth poses challenges to the West. Competition will force some to work harder, to become more efficient, or to accept lower profits.

But economics is really a positive-sum game

We should all hope that China’s new economic model succeeds. If it does, all of us will have much to gain.


The World Bank at bay

Even if Paul Wolfowitz is eventually forced to resign, nothing will be gained if George Bush is allowed summarily to choose his replacement.

…Why does the world meekly go along with the status quo and let the US dictate the Bank's top position? It is a sorry tale of poor global governance. Europe does not get in America's way because it wants to maintain Europe's equally out-dated privilege of appointing the head of the International Monetary Fund, the Bank's sister institution.

Asia has little choice but to defer to the US and Europe's shenanigans because it is grossly under-represented in both organisations. As for Africa, its leaders are loath to do or say anything that might interrupt the flow of World Bank largesse.

Many people, including myself, have long complained about the leadership selection process at the World Bank and the IMF. How can the Bank and the IMF continue to go around lecturing developing economies on good governance and transparency but fail to allow change in their own houses?

And just for fun, Ken said this to Joe back in 2002:

“Joe, as an academic, you are a towering genius. Like your fellow Nobel Prize winner, John Nash, you have a "beautiful mind." As a policymaker, however, you were just a bit less impressive.

Other than that, I thought it was a pretty good book.

Sincerely yours,


It is from his open letter to Jeo expressing his discontent for Globalization and Its Discontents.




Anonymous said...

Economics as a positive sum game? reminds me of an old joke I've heard:

2 economists were walking down the road. they spot a rotten sandwich.
Economist #1 tells #2: If you eat that, I'll pay you 100 bucks.

Economist #2 says okay, and eats it.

Economist #1 pays #2 100 dollars, and they continue their walk. Then they saw another rotten sandwich on the road.

Economist #2 said: This time, I'll pay you $100 if you eat that rotten sandwich.

Economist #1 said, okay, ate it and was paid. And they continued their walk.

Economist #2 said: You know, we have the same amount of money we both started out with, and we are not any better off - in fact, we're worst off, we'll gonna get stomachaches soon.

Economist #1 replied: Yeah, sure, but you overlooked the fact that $200 of trade just took place

So much for positive sum game lol.


Anonymous said...


Anonymous said...

"Economics is the only field in which two people can share a Nobel Prize for saying opposing things." Specifically, Myrdal and Hayek shared one.

Anonymous said...

SOCIALISM: You have two cows. State takes one and give it to someone else.

COMMUNISM: You have two cows. State takes both of them and gives you milk.

FASCISM: You have two cows. State takes both of them and sell you milk.

NAZISM: You have two cows. State takes both of them and shoot you.

BUREAUCRACY: You have two cows. State takes both of them, kill one and spill the milk in system of sewage.

CAPITALISM: You have two cows. You sell one and buy a bull.

zcer said...

why do jokes have to not make sense?
sorry, but i set a very high standard for jokes. so that joke sucks.
it's like those stupid math equations that derive, women=pain or study=fail etc.
and i do have a sense of humor, all my friends can testify

and do you know why that joke scenario isn't the economy?

and what was this post about again?

Anonymous said...

you've been mixing with the wrong herd...

your friends could be just like you....without a sense of humour. its like asking UMNO wether MCA has done a good job.

im sure all of elanor's readers know why the joke isnt the economy...not only you..its just a joke...take it easy and go get a sense of humour.

Anonymous said...

btw, there is not only one genre when it comes to jokes....

lighten up...your pants are too tight

Anonymous said...


since you claim to have a sense of humour, and a high standard for tell one...

zcer said...

are you kidding? the only good jokes are shifts of perspective or context, like meta or analogical jokes. although sophistication has an aesthetic value, so does elegance. but any joke that satisfied the previous criteria is as good. and ANY joke that violates logic SUCKS

you are likely not to get it. logic doesn't constrain at all. For example, on somebody introducing you to her bedroom and you see it's so big. You say, "this is not a bedroom, this is a hall!". Hall? Room? They are fuzzy categories. Unlike popular jokes which owe their existence only to the SLOPPINESS in thinking of those who created the jokes. Psychologically, jokes are funny precisely because they are unexpected YET have a sense of logic. You simply find logic defying jokes funny because you suck at reasoning. ((No? If my friends didn't have a sense of humor why did they laugh at my jokes?(also note that i didn't say you didn't have a sense of humor. just that your sense of humor is inferior and inappropriate, possibly even dangerous)

Someone is recommending you a thing. You say you probably won't like it. She says, "do not condemn the shoe you havent tried", you reply, "do not condemn the slut you haven't fucked"

And why are both my examples circumstantial? Because contrived jokes are contrived. It's like masturbation. Or modernist art. Or binary clocks. Whatever...

Proust wrote: "The real voyage of discovery, consists not in seeking new landscapes, but in having new eyes"

In short the world is boring, but fantasy even more so. Real fiction, real jokes, reinterpret reality in novel, yet satisfying ways.

But yeah, you're right, even kitsch is art.

Benkaiser said...

Economics is simply our daily lives, from individual to aggregation.

Being pragmatic could be the best path for economics.

Anonymous said...

No? If my friends didn't have a sense of humor why did they laugh at my jokes?

answer: they could have been laughing at your lameness and stupidity....sometimes you are the joke..get it?

just that your sense of humor is inferior and inappropriate, possibly even dangerous)

i can say the same about you..being too one dimensional. Jokes are open to subjective interpretation. As i said...your pants are too tight....and too high.

btw, i appreciate all types of jokes...logic defying or otherwise. Both can lead to humour. Dont be so hard up and rashly classify my humour inclinations.....i know u did it for yourself but dont do it for others....relax....release...and tell a joke from your school of thought...share with us....

Anonymous said...

OMG temperature rising high here, Elanor.


zcer said...

don't worry feliz, this is just a game!

"they could have been laughing at your lameness and stupidity....sometimes you are the joke..get it?"

yeah, provided i'm pathetically STUPID. or delusional.

And i'm not trying to define humor. ANYTHING at all that makes ppl laugh is humor. Some jokes are simply better than others.

If you didn't notice, i already did include quite a number of jokes in my previous comment. They are just not jokes you can tell like you would a story. I don't like those jokes. And btw, you are supposed to imagine how such the scenarios would be funny. It is impossible to reproduce their funniness here.

Just look at the joke you first posted, did you really naturally laugh out loud? Perhaps, but probably you thought "ooh, this is a clever and sophisticated joke, it should be funny!" And then you somewhat forced a laugh. I personally cringe at such contrived jokes. One more example would be, Chewxy's fantasies of elanor.

And really, did I say your sense of humor was WRONG? I'm just putting forth MY opinion on what jokes are good.

Notice also, you have accused me either of idiocy or autism. And I merely voiced out my opinion of a joke that wasn't even yours.

I think I also need to make clear what I mean by jokes that defy logic. Take a look at the link above to chewxy's post. Has the joke at all have anything to do with economics? No, it merely uses economic words with different senses. Let's say there is no such thing as economics. And he plucked the words out of thin air. Would it then be funny? Would it even make sense? A true jokes transcends language.

What i do NOT mean by logic-defying humor OTOH, is like that of cartoons where the character runs off a cliff and gravity is delayed until the character realizes it. It plays with our understanding that the laws of physics don't depend on our awareness of them. We know EXACTLY what is violated. I don't think you anybody who truly understands the non-zero sumness of economics, can REALLY find that joke funny (she may consciously think that it should be funny). What's more, that scenario has NOTHING whatsoever to do with economics being non-zero sum! Can you tell me what is violated there?

Anonymous said...

you said that the joke sucks and of low standards and gave a very in depth but very subjective explanation about jokes.

dont compare when it comes from a different genre which you dont appreciate. Not everybody is like you and must be like you, so dont be so cynical.

At the end of the day, you are entitled to your opinions and im entitled to mine....i've not violated anything either. Lets end the debate about jokes and get back to economics......

ok, your pants aint tight...problem settled

zcer said...

sigh, fine. I was hoping you would defend your taste of jokes rather than attacking me. This could have been more interesting.
And genre not equal taste. Of course everyone is entitled to their own opinion. We all know that. But we should also try to understand each other's viewpoints. Tolerance not equal ignorance. And violation means violation of usual thought patterns. Not violation of some Law of Jokes. Jokes tickle our brains you see, when they present a non-standard but logical perspective on the usual. It's Isaac Asimov's theory of jokes. Yeah, it's not that unobscure, sorry.

I'm sure though, that the joke is being used by a good professor somewhere that is explaining economics to his class. So, it's a useful joke at that.

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