nhaliday + automation + war + ๐ŸŽฉ   3

How important was colonial trade for the rise of Europe? | Economic Growth in History
The latter view became the orthodoxy among economists and economic historians after Patrick Oโ€™Brienโ€™s 1982 paper, which in one of many of Patrickโ€™s celebrated phrases, claims that โ€œโ€the periphery vs peripheralโ€ย for Europe. He concludes the paper by writing:

โ€œ[G]rowth, stagnation, and decay everywhere in Western Europe can be explained mainly by reference to endogenousย forces. โ€ฆย for the economic growth of the core, the periphery was peripheral.โ€

This is the view thatย remarkable scholarsย such as N. Crafts, Deirdre McCloskey, or Joel Mokyr repeat today (though Crafts would argue cotton imports would have mattered in a late stage, and my reading of Mokyr is that he has softened his earlier view from the 1980s a little, specificallyย in the bookย The Enlightened Economy.) Even recently,ย Brad deLong has classifyied Oโ€™Brienโ€™s 1982 position asย โ€œair tightโ€.

Among economists and economic historians more on the economics side, I would say that Oโ€™Brienโ€™s paper was only one of two strong hits against the โ€œWorlds-Systemโ€ and related schools of thoughtsย of the 1970s, the other hit beingย Solowโ€™s earlier conclusionย that TFP growth (usually interpreted as technology, though thereโ€™s more to it than that) has accounted for economic growth a great deal more than capital accumulation, which isย what Hobsbawm and Wallerstein, in their neo-Marxist framework, emphasize.

A friend tonight, on the third world and the first world, and our relationships to the past: "They don't forget, and we don't remember."
imo the European Intifada is being fueled by anti-Europeanism & widely taught ideas like this one discussed - Europe stole its riches

The British Empire was cruel, rapacious and racist. But contrary to what Shashi Tharoor writes in An Era Of Darkness, the fault for Indiaโ€™s miseries lies upon itself.

Indeed, the anti-Tharoor argument is arguably closer to the truth, because the British tended to use the landlord system in places where landlords were already in place, and at times when the British were relatively weak and couldnโ€™t afford to upset tradition. Only after they became confident in their power did the British start to bypass the landlord class and tax the cultivators directly. Kingโ€™s College London historian Jon Wilson (2016) writes in India Conquered, โ€œWherever it was implemented, raiyatwar began as a form of military rule.โ€ Thus the system that Tharoor implicitly promotes, and which is associated with higher agricultural productivity today, arose from the very same colonialism that he blames for so many of Indiaโ€™s current woes. History does not always tell the parables that we wish to hear.


Indiaโ€™s share of the world economy was large in the eighteenth century for one simple reason: when the entire world was poor, India had a large share of the worldโ€™s population. Indiaโ€™s share fell because with the coming of the Industrial Revolution, Europe and North America saw increases of income per capita to levels never before seen in all of human history. This unprecedented growth cannot be explained by Britainโ€™s depredations against India. Britain was not importing steam engines from India.

The big story of the Great Divergence is not that India got poorer, but that other countries got much richer. Even at the peak of Mughal wealth in 1600, the best estimates of economic historians suggest that GDP per capita was 61% higher in Great Britain. By 1750โ€“before the battle of Plassey and the British takeoverโ€“GDP per capita in Great Britain was more than twice what it was in India (Broadberry, Custodis, and Gupta 2015). The Great Divergence has long roots.

Tharoor seems blinded by the glittering jewels of the Maharajas and the Mughals. He writes with evident satisfaction that when in 1615 the first British ambassador presented himself to the court of Emperor Jehangir in Agra, โ€œthe Englishman was a supplicant at the feet of the worldโ€™s mightiest and most opulent monarch.โ€ True; but the Emperorโ€™s opulence was produced on the backs of millions of poor subjects. Writing at the same time and place, the Dutch merchant Francisco Pelsaert (1626) contrasted the โ€œgreat superfluity and absolute powerโ€ of the rich with โ€œthe utter subjection and poverty of the common peopleโ€“poverty so great and miserable that the life of the people can be depictedโ€ฆonly as the home of stark want and the dwelling-place of bitter woe.โ€ Indian rulers were rich because the empire was large and inequality was extreme.

In pre-colonial India the rulers, both Mughal and Maratha, extracted _anywhere from one-third to one half of all gross agricultural output_ and most of what was extracted was spent on opulence and the armed forces, not on improving agricultural productivity (Raychaudhuri 1982).


The British were awful rulers but the history of India is a long story of awful rulers (just as it is for most countries). Indeed, by Maddisonโ€™s (2007) calculations _the British extracted less from the Indian economy than did the Mughal Dynasty_. The Mughals built their palaces in India while the British built most of their palaces in Britain, but that was little comfort to the Indian peasant who paid for both. The Kohinoor diamond that graces the cover of Inglorious Empire is a telling symbol. Yes, it was stolen by the British (who stole it from the Sikhs who stole it from the Afghanis who stole it from the Mughals who stole it from one of the kings of South India). But how many Indians would have been better off if this bauble had stayed in India? Perhaps one reason why more Indians didnโ€™t take up arms against the British was that for most of them, British rule was a case of meet the new boss, same as the old boss.

more for effect on colonies: https://pinboard.in/u:nhaliday/b:4b0128372fe9

INDIA AND THE GREAT DIVERGENCE: AN ANGLO-INDIAN COMPARISON OF GDP PER CAPITA, 1600-1871: http://eh.net/eha/wp-content/uploads/2013/11/Guptaetal.pdf
This paper provides estimates of Indian GDP constructed from the output side for the pre-1871 period, and combines them with population estimates to track changes in living standards. Indian per capita GDP declined steadily during the seventeenth and eighteenth centuries before stabilising during the nineteenth century. As British living standards increased from the mid-seventeenth century, India fell increasingly behind. Whereas in 1600, Indian per capita GDP was over 60 per cent of the British level, by 1871 it had fallen to less than 15 per cent. As well as placing the origins of the Great Divergence firmly in the early modern period, the estimates suggest a relatively prosperous India at the height of the Mughal Empire, with living standards well above bare bones subsistence.

but some of the Asian wage data (especialy India) have laughably small samples (see Broadberry & Gupta)

How profitable was colonialism for various European powers?: https://www.reddit.com/r/AskHistorians/comments/p1q1q/how_profitable_was_colonialism_for_various/

How did Britain benefit from colonising India? What did colonial powers gain except for a sense of power?: https://www.quora.com/How-did-Britain-benefit-from-colonising-India-What-did-colonial-powers-gain-except-for-a-sense-of-power
The EIC period was mostly profitable, though it had recurring problems with its finances. The initial voyages from Surat in 1600s were hugely successful and brought profits as high as 200%. However, the competition from the Dutch East India Company started to drive down prices, at least for spices. Investing in EIC wasnโ€™t always a sure shot way to gains - British investors who contributed to the second East India joint stock of 1.6 million pounds between 1617 and 1632 ended up losing money.


An alternate view is that the revenues of EIC were very small compared to the GDP of Britain, and hardly made an impact to the overall economy. For instance, the EIC Revenue in 1800 was 7.8m pounds while the British GDP in the same period was 343m pounds, and hence EIC revenue was only 2% of the overall GDP. (I got these figures from an individual blog and havenโ€™t verified them).


The British Crown period - The territory of British India Provinces had expanded greatly and therefore the tax revenues had grown in proportion. The efficient taxation system paid its own administrative expenses as well as the cost of the large British Indian Army. British salaries were lucrative - the Viceroy received ยฃ25,000 a year, and Governors ยฃ10,000 for instance besides the lavish amenities in the form of subsidized housing, utilities, rest houses, etc.


Indian eminent intellectual, Dadabhai Naoroji wrote how the British systematically ensured the draining of Indian economy of its wealth and his theory is famously known as โ€˜Drain of Wealthโ€™ theory. In his book 'Poverty' he estimated a 200โ€“300 million pounds loss of revenue to Britain that is not returned.

At the same time, a fair bit of money did go back into India itself to support further colonial infrastructure. Note the explosion of infrastructure (Railway lines, 100+ Cantonment towns, 60+ Hill stations, Courthouses, Universities, Colleges, Irrigation Canals, Imperial capital of New Delhi) from 1857 onward till 1930s. Of course, these infrastructure projects were not due to any altruistic motive of the British. They were intended to make their India empire more secure, comfortable, efficient, and to display their grandeur. Huge sums of money were spent in the 3 Delhi Durbars conducted in this period.

So how profitable was the British Crown period? Probably not much. Instead bureaucracy, prestige, grandeur, comfort reigned supreme for the 70,000 odd British people in India.


There was a realization in Britain that colonies were not particularly economically beneficial to the home economy. โ€ฆ [more]
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june 2017 by nhaliday
Interview: Mostly Sealing Wax | West Hunter

- conformity and Google, defense and spying (China knows prob almost all our "secrets")
- in the past you could just find new things faster than people could reverse-engineer. part of the problem is that innovation is slowing down today (part of the reason for convergence by China/developing world).
- introgression from archaics of various kinds
- mutational load and IQ, wrath of khan neanderthal
- trade and antiquity (not that useful besides ideas tbh), Roman empire, disease, smallpox
- spices needed to be grown elsewhere, but besides that...
- analogy: caste system in India (why no Brahmin car repairmen?), slavery in Greco-Roman times, more water mills in medieval times (rivers better in north, but still could have done it), new elite not liking getting hands dirty, low status of engineers, rise of finance
- crookery in finance, hedge fund edge might be substantially insider trading
- long-term wisdom of moving all manufacturing to China...?
- economic myopia: British financialization before WW1 vis-a-vis Germany. North vs. South and cotton/industry, camels in Middle East vs. wagons in Europe
- Western medicine easier to convert to science than Eastern, pseudoscience and wrong theories better than bag of recipes
- Greeks definitely knew some things that were lost (eg, line in Pliny makes reference to combinatorics calculation rediscovered by German dude much later. think he's referring to Catalan numbers?), Lucio Russo book
- Indo-Europeans, Western Europe, Amerindians, India, British Isles, gender, disease, and conquest
- no farming (Dark Age), then why were people still farming on Shetland Islands north of Scotland?
- "symbolic" walls, bodies with arrows
- family stuff, children learning, talking dog, memory and aging
- Chinese/Japanese writing difficulty and children learning to read
- Hatfield-McCoy feud: the McCoy family was actually a case study in a neurological journal. they had anger management issues because of cancers of their adrenal gland (!!).

the Chinese know...: https://macropolo.org/casting-off-real-beijings-cryptic-warnings-finance-taking-economy/
Over the last couple of years, a cryptic idiom has crept into the way Chinaโ€™s top leaders talk about risks in the countryโ€™s financial system: tuo shi xiang xu (่„ฑๅฎžๅ‘่™š), which loosely translates as โ€œcasting off the real for the empty.โ€ Premier Li Keqiang warned against it at his press conference at the end of the 2016 National Peopleโ€™s Congress (NPC). At this yearโ€™s NPC, Li inserted this very expression into his annual work report. And in April, while on an inspection tour of Guangxi, President Xi Jinping used the term, saying that China must โ€œunceasingly promote industrial modernization, raise the level of manufacturing, and not allow the real to be cast off for the empty.โ€

Such an odd turn of phrase is easy to overlook, but it belies concerns about a significant shift in the way that Chinaโ€™s economy works. What Xi and Li were warning against is typically called financialization in developed economies. Itโ€™s when โ€œrealโ€ companiesโ€”industrial firms, manufacturers, utility companies, property developers, and anyone else that produces a tangible product or serviceโ€”take their money and, rather than put it back into their businesses, invest it in โ€œemptyโ€, or speculative, assets. It occurs when the returns on financial investments outstrip those in the real economy, leading to a disproportionate amount of money being routed into the financial system.

Bad day for Lehman Bros.
Good day for everyone else, then.
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may 2017 by nhaliday
Educational Romanticism & Economic Development | pseudoerasmus


Did Nations that Boosted Education Grow Faster?: http://econlog.econlib.org/archives/2012/10/did_nations_tha.html
On average, no relationship. The trendline points down slightly, but for the time being let's just call it a draw. It's a well-known fact that countries that started the 1960's with high education levels grew faster (example), but this graph is about something different. This graph shows that countries that increased their education levels did not grow faster.

Where has all the education gone?: http://citeseerx.ist.psu.edu/viewdoc/download?doi=




The Case Against Education: What's Taking So Long, Bryan Caplan: http://econlog.econlib.org/archives/2015/03/the_case_agains_9.html

The World Might Be Better Off Without College for Everyone: https://www.theatlantic.com/magazine/archive/2018/01/whats-college-good-for/546590/
Students don't seem to be getting much out of higher education.
- Bryan Caplan

College: Capital or Signal?: http://www.economicmanblog.com/2017/02/25/college-capital-or-signal/
After his review of the literature, Caplan concludes that roughly 80% of the earnings effect from college comes from signalling, with only 20% the result of skill building. Put this together with his earlier observations about the private returns to college education, along with its exploding cost, and Caplan thinks that the social returns are negative. The policy implications of this will come as very bitter medicine for friends of Bernie Sanders.

Doubting the Null Hypothesis: http://www.arnoldkling.com/blog/doubting-the-null-hypothesis/

Is higher education/college in the US more about skill-building or about signaling?: https://www.quora.com/Is-higher-education-college-in-the-US-more-about-skill-building-or-about-signaling
ballpark: 50% signaling, 30% selection, 20% addition to human capital
more signaling in art history, more human capital in engineering, more selection in philosophy

Econ Duel! Is Education Signaling or Skill Building?: http://marginalrevolution.com/marginalrevolution/2016/03/econ-duel-is-education-signaling-or-skill-building.html
Marginal Revolution University has a brand new feature, Econ Duel! Our first Econ Duel features Tyler and me debating the question, Is education more about signaling or skill building?

Against Tulip Subsidies: https://slatestarcodex.com/2015/06/06/against-tulip-subsidies/




Most American public school kids are low-income; about half are non-white; most are fairly low skilled academically. For most American kids, the majority of the waking hours they spend not engaged with electronic media are at school; the majority of their in-person relationships are at school; the most important relationships they have with an adult who is not their parent is with their teacher. For their parents, the most important in-person source of community is also their kidsโ€™ school. Young people need adult mirrors, models, mentors, and in an earlier era these might have been provided by extended families, but in our own era this all falls upon schools.

Caplan gestures towards work and earlier labor force participation as alternatives to school for many if not all kids. And I empathize: the years that I would point to as making me who I am were ones where I was working, not studying. But they were years spent working in schools, as a teacher or assistant. If schools did not exist, is there an alternative that we genuinely believe would arise to draw young people into the life of their community?


It is not an accident that the state that spends the least on education is Utah, where the LDS church can take up some of the slack for schools, while next door Wyoming spends almost the most of any state at $16,000 per student. Education is now the one surviving binding principle of the society as a whole, the one black box everyone will agree to, and so while you can press for less subsidization of education by government, and for privatization of costs, as Caplan does, thereโ€™s really nothing people can substitute for it. This is partially about signaling, sure, but itโ€™s also because outside of schools and a few religious enclaves our society is but a darkling plain beset by winds.

This doesnโ€™t mean that we should leave Caplanโ€™s critique on the shelf. Much of education is focused on an insane, zero-sum race for finite rewards. Much of schooling does push kids, parents, schools, and school systems towards a solution ad absurdum, where anything less than 100 percent of kids headed to a doctorate and the big coding job in the sky is a sign of failure of everyone concerned.

But letโ€™s approach this with an eye towards the limits of the possible and the reality of diminishing returns.

The real reason the left would support Moander: the usual reason. because heโ€™s an enemy.

I have a problem in thinking about education, since my preferences and personal educational experience are atypical, so I canโ€™t just gut it out. On the other hand, knowing that puts me ahead of a lot of people that seem convinced that all real people, including all Arab cabdrivers, think and feel just as they do.

One important fact, relevant to this review. I donโ€™t like Caplan. I think he doesnโ€™t understand โ€“ canโ€™t understand โ€“ human nature, and although that sometimes confers a different and interesting perspective, itโ€™s not a royal road to truth. Nor would I want to share a foxhole with him: I donโ€™t trust him. So if I say that I agree with some parts of this book, you should believe me.


Caplan doesnโ€™t talk about possible ways of improving knowledge acquisition and retention. Maybe he thinks thatโ€™s impossible, and he may be right, at least within a conventional universe of possibilities. Thatโ€™s a bit outside of his thesis, anyhow. Me it interests.

He dismisses objections from educational psychologists who claim that studying a subject improves you in subtle ways even after you forget all of it. I too find that hard to believe. On the other hand, it looks to me as if poorly-digested fragments of information picked up in college have some effect on public policy later in life: it is no coincidence that most prominent people in public life (at a given moment) share a lot of the same ideas. People are vaguely remembering the same crap from the same sources, or related sources. Itโ€™s correlated crap, which has a much stronger effect than random crap.

These widespread new ideas are usually wrong. They come from somewhere โ€“ in part, from higher education. Along this line, Caplan thinks that college has only a weak ideological effect on students. I donโ€™t believe he is correct. In part, this is because most people use a shifting standard: whatโ€™s liberal or conservative gets redefined over time. At any given time a population is roughly half left and half right โ€“ but the content of those labels changes a lot. Thereโ€™s a shift.

I put it this way, a while ago: โ€œWhen you think about it, falsehoods, stupid crap, make the best group identifiers, because anyone might agree with you when youโ€™re obviously right. Signing up to clear nonsense is a better test of group loyalty. A true friend is with you when youโ€™re wrong. Ideally, not just wrong, but barking mad, rolling around in your own vomit wrong.โ€
You just explained the Credo quia absurdum doctrine. I always wondered if it was nonsense. It is not.
Someone on twitter caught it first โ€“ got all the way to โ€œsliding down the razor blade of lifeโ€. Which I explained is now called โ€œtransitioningโ€

What Catholics believe: https://theweek.com/articles/781925/what-catholics-believe
We believe all of these things, fantastical as they may sound, and we believe them for what we consider good reasons, well attested by history, consistent with the most exacting standards of logic. We will profess them in this place of wrath and tears until the extraordinary event referenced above, for which men and women have hoped and prayed for nearly 2,000 years, comes to pass.

According to Caplan, employers are looking for conformity, conscientiousness, and intelligence. They use completion of high school, or completion of college as a sign of conformity and conscientiousness. College certainly looks as if itโ€™s mostly signaling, and itโ€™s hugely expensive signaling, in terms of college costs and foregone earnings.

But inserting conformity into the merit function is tricky: things become important signalsโ€ฆ because theyโ€™re important signals. Otherwise useful actions are contraindicated because theyโ€™re โ€œnot doneโ€. For example, test scores convey useful information. They could help show that an applicant is smart even though he attended a mediocre school โ€“ the same role they play in college admissions. But employers seldom request test scores, and although applicants may provide them, few do. Caplan says โ€ The word on the streetโ€ฆ [more]
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april 2017 by nhaliday

bundles : dismality โ€ง econ โ€ง guvnor โ€ง stars

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