From researchers Steven A. Altman and Phillip Bastian:
Despite recent trade turbulence, the ratio of gross exports to world GDP is still remarkably close to its all-time high. Even after falling from a peak of 32% in 2008 to 29% in 2019, this measure of global trade integration is still 20% higher than it was in 2000, twice as high as it was in 1970, and almost six times higher than in 1945. ... Globalization can go into reverse—as demonstrated by the trendlines between the 1920s and 1950s—but recent data do not depict a similar reversal. ...
[T]he world is—and will remain—only partially globalized. Globalization can rise or fall significantly without getting anywhere close to either a state where national borders become irrelevant or one where they loom so large that it is best to think of a world of disconnected national economies. All signs point to a future where international flows will remain so large that decision-makers ignore them at their peril, even as borders and cross-country differences continue to make domestic activity the default in most areas.
Economist Timothy Taylor reviews the report and offers other insights: What's Happening with Global Connectedness in the Pandemic?
The chart below is based on maternal mortality rates, the number of women per 100,000 who die from pregnancy-related causes in a year. The first bar shows how many women die each year, while the second bar shows how many would die if they had Europe's living standards. What conclusions would you draw?
The global rate is 216, while the European rate is 8. The global rate is 27 times higher! About 290,000 women die each year because they do not have the living standards of the most affluent countries.
I would hope this would spark a sense of injustice. Something is wrong with a system that creates such a disparity in outcomes. Surely, we must upend this inequitable system and replace it with something just.
Now look at the second chart. What conclusions would you draw?
Before 1800, the global maternal mortality rate was 900. Today it is 216! It has dropped by 75%. By historical standards, this borders on miraculous. Something is right about a system that radically improves human well-being. How can we preserve and extend the improvement? (Note: The global rate dropped steadily from 385 in 1990 to 216 in 2015. The trajectory continues rapidly downward.)
A holistic view of human well-being will consider this chart, including all three bars.
Some observations.
First, we would have a more equitable maternal mortality rate without the systems that developed over the past two centuries. No place on earth would have a rate of eight deaths OR 216 deaths. We would still have a very equitable world of 900 deaths. Is that "equality" preferable to today's eight vs. 216 inequality? I do not think many would agree. The eight vs. 216 differential is good relative to the historical alternative.
Second, that some locales have a rate of eight, points to the possibility of a world where this level of well-being spans the globe. Justice requires that we pursue this equitable outcome. We must look back to understand what brought us to where we are and be discerning about obstacles blocking this objective going forward.
Third, I am using maternal mortality rates as a symbol of broader improvement in human well-being in recent generations, sometimes called the Great Divergence. Appreciating this significant divergence from human history neither requires us, in some consequentialist way, to a) embrace all that has developed in the past couple of centuries nor b) to refrain from asking rigorous questions about justice going forward. There have been profound injustices and inequities in the past two centuries. There are today. And yet, the Great Divergence happened, and it continues. Lack of historical context and blindness to trajectories can lead us to snap-shot-in-time views that inspire us to well-intentioned but destructive actions, destroying good in the process. Keep what works and adjust with discernment. Neither revolution nor complacency will do.
Interesting infographic from McKinsey Global Institute. For details read Globalization in transition: The future of trade and value chains.
The following quote comes from Runaway World: How Globalization is Reshaping Our Lives. It was written in 1998, by British sociologist, Anthony Giddens.
What Globalisation is, and whether it is in any way new, are the focus of intense debate. I discuss this debate in Chapter I, since much else hangs upon it. Yet the facts of the matter are actually quite clear. Globalisation is restructuring the ways in which we live, and in a very profound manner. It is led from the west, bears the strong imprint of American political and economic power, and is highly uneven in its consequences. But globalisation is not just the dominance of the West over the rest; it affects the United States as it does other countries.
Globalisation also influences everyday life as much as it does events happening on a world scale. That is why this book includes an extended discussion of sexuality, marriage and the family. In most parts of the world, women are staking claim to greater autonomy than in the past and are entering the labour force in large numbers. Such aspects of globalisation are at least as important as those happening in the global-market place. They contribute to the stresses and strains affecting traditional ways of life and cultures in most regions of the world. The traditional family is under threat, is changing, and will change much further. Other traditions, such as those concerned with religion, are also experiencing major transformations. Fundamentalism originates from a world of crumbling traditions.
The battleground of the twenty-first century will pit fundamentalism against cosmopolitan tolerance. In a globalising world, where information and images are routinely transmitted across the globe, we are all regularly in contact with others who think differently, and live differently, from ourselves. Cosmopolitans welcome and embrace this cultural complexity. Fundamentalists find it disturbing and dangerous. Whether in the areas of religion, ethnic identity or nationalism, they rake refuge in a renewed and purified tradition – and, quite often, violence.
We can legitimately hope that a cosmopolitan outlook will win out. Tolerance of culture diversity and democracy are closely connected, and democracy is currently spreading world-wide. Globalisation lies behind the expansion of democracy. At the same time, paradoxically, it exposes the limits of democratic structures which are most familiar, namely the structures of parliamentary democracy. We need to further democratize existing institutions, and to do so in ways that respond to the demands of the global age. We shall never be able to become the master of our own history, but we can and must find ways of bringing our runaway world to heel. (3-5)
This short collection of essays has stuck with me ever since I first read it years ago. As I have reflected on the past two years American political scene, this book's insights have become ever more prescient. I see the rise of Trump nationalism as a reactionary response to globalization. (This is not conservatism vs. progressivism, as we have recently understood them.) It is the death throes of the twentieth-century world order. It may be short-lived. It may last a generation. But I suspect that it is ultimately doomed. Over the long haul, globalization is an inescapable dynamic. However, that does not mean that significant harm to human well-being and the planet will not happen during these death throes.
Since at least the eighteenth century, we have seen an unprecedented improvement in human well-being, accelerating through the nineteenth century down to the present and spreading around the world. But we should not forget that this improvement was punctuated by a retreat from globalization, resulting in two destructive world wars bracketing a global depression. One hundred years from now, I suspect global human well-being will have made substantial strides over our present living standards. I think globalization is virtually inevitable because we have amassed enough information and experience to see that a globalized world, for all its present vagaries and challenges, is the path to the mutual common good. What is much less clear is what happens in the short term. I suspect this is the most significant turning point in the world that most of us will ever experience.
The world is becoming a better place. It is not a utopia. We are not without substantial challenges. But we are becoming (as in movement along a trajectory) better (as in measurably improved according to a standard.)
The Human Development Index is a United Nations measure of well-being combining income, literacy, education, and life expectancy data. Here is the index for the world nations in 1980 and 2012. The reality is that we are living through the most astonishing transformation toward human well-being in all of history. You can find the interactive version of the chart at Our Data.
Are you smarter than a chimp? There is a good chance you are not when it comes to knowledge about global socioeconomic trends. For years, Swedish global health expert, Hans Rosling, has been giving Ted talks and making presentations about global trends. One of his favorite teaching tools is to ask people a question like this:
Globally, over the past 20 years, the rate of extreme poverty has:
Now chimps will randomly select, giving each answer a 33% chance. Yet when Rosling asks audiences, at least half will say A, a sizable percentage will say B, while a few will say C. Yet C is the correct answer! This is the case with one variable after another. Audiences routinely score worse than chimps, choosing the most negative option.
An old adage states, "It isn't what we don't know that gets us in trouble. It's what we know that ain't so." That we routinely pick the wrong answer more often than chimps shows that we have bias.
In the Ted talk, How not to be ignorant about the world, Hans' son Rosling notes that part of the problem is our education system. Teachers go to college at a particular point in time and learn the state of the world at that time. But they tend not to learn about ongoing developments. The data has often been hard to come by and hard to interpret. So teachers are biased by what they learned years ago. (Reporters have the same problem.) But there are other factors.
During our evolutionary history, our brains became wired to notice threats. Hunters walking through the brush who were attentive to the possibility of tigers lying in wait likely survived those who went about carelessly enjoying a beautiful day. So when we reflect on broad human trends, we fixate on perceived threats. What was useful for us in the wild is counterproductive as we try to interpret socioeconomic trends. If you want to outscore a chimp on an exam about global well-being, Ola Rosling suggests that you must drop your predispositions and adopt these four rules of thumb:
1. Assume most things are improving.
2. Assume most people are in the middle of a distribution, not a binary of rich and poor.
3. Assume social development precedes becoming wealthy. (Don't assume that a population must be rich before meeting basic social needs.)
4. Assume you are exaggerating the threat if the topic is something you personally fear.
Additionally, Hans, Ola, and others have been working to build the Gapminder website to provide you with data that can be presented in meaningful ways. But one of the most important contributions the Roslings have made is their collection of entertaining and informative videos. In this post, I include every video I can find with a brief annotation. (I'll add more as I find any.) Many videos overlap or cover similar data but are all well worth viewing. So here is your resource for becoming smarter than a chimp. Don't say I never gave you anything.
(This link also has links to most of these videos, including some shorts not listed here: Gapminder Video)
Hans Rosling's 200 Countries, 200 Years, 4 Minutes (2010)
If you are just getting acquainted with Rosling, I'd begin here. This four-minute presentation gives you a quick sense of what he is talking about.
Hans and Ola Rosling: How not to be ignorant about the world. TED June 2014
This is the second video to watch. The front half is Hans making his case that the world is improving, and the back half is Ola explaining, as I recounted above, why we are so disinclined to see positive change.
Hans Rosling: The magic washing machine. TED December 2010
This is the third one to watch. This is one of my favorites. While fully embracing the concern about the environmental impacts of economic growth, Rosling shows the importance of economic growth through the story of the washing machine.
THE REST ARE IN CHRONOLOGICAL ORDER
Hans Rosling: The best stats you've ever seen. TED February 2006
The TED presentation that kicked it all off. He focuses on the positive changes underway in the world. He points to his efforts to liberate, integrate, and animate data and to find ways to present data the public finds understandable.
Hans Rosling: New Insights on Poverty. TED March 2007
Rosling shows that social development tends to precede economic development. He addresses the issue that, unfortunately, economic development has always been based on fossil fuels. Higher yields, technology, and markets are key to ending poverty, but more dimensions like human rights, environment, governance, economic growth, education, health, and culture need our attention. The ending has a great surprise!
Human Rights and Democracy Statistics- Gapminder c. 2008
Rosling describes why human rights are so hard to describe and evaluate.
Yes they can! - Gapminder c. 2008
Rosling explains that poor nations will one day become prosperous, and we should welcome that.
Poor Beats Rich in MDG Race - Gapminder c. 2008
Rosling shows that countries that have developed from poverty to well-being have done so faster than Western nations. Poor countries today can make the transition much quicker because of what previous countries have learned.
What stops population growth? - Gapminder c. 2008
Small families are the key to ending population growth, and the key to small families is childhood survival.
Hans Rosling: Insights on HIV, in stunning data visuals. TED February 2009
Uses Gapminder data to show nuances in how AIDS has spread and what it takes to defeat it.
Hans Rosling: Let my dataset change your mindset. TED June 2009
This is the third video you should watch. Rosling deconstructs the dichotomy of wealthy and developing nations and challenges the idea of thinking in sweeping terms like "Africa."
The Joy of Stats with Professor Hans Rosling - Gapminder c. 2010
Rosling shows how making data available and animating empowers people to make better decisions, sometimes without realizing they are using statistics.
Hans Rosling: Asia's rise -- how and when. TED Nov 2009
Rosling forecasts when China and India will catch up with the USA and UK.
Hans Rosling: Global population growth, box by box. TED June 2010
Rosling says that child survival is the new green. This video explains why.
Hans Rosling: The good news of the decade? We're winning the war against child mortality. TED September 2010
Rosling breaks down the remarkable trends in child mortality. Education of women accounts for at least 50% of the drop.
Hans Rosling: Religions and babies. TED April 2012
Religion is not a factor in family size. There is no significant difference between Islamic and Christian countries regarding births per woman. The defining difference is economic well-being.
DON'T PANIC — Hans Rosling showing the facts about population. BBC November 2013
A one-hour investigation into the dynamics of population growth using stories about real live families interspersed with Rosling's entertaining presentation of data.
Don't Panic - How to End Poverty in 15 Years. BBC September 2015
No embed is available.
Here is a link to a series of short videos on how to use development data visually.
An introduction to visualising development data
Conversable Economist: The Rise of Remittances
"Here's a pattern showing the rise in remittances over time compared to some other international financial flows. Back in 1990, international remittances were lower than official development assistance (ODA). Flows of foreign direct investment (FDI) to developing countries were also smaller than ODA, as were flows of private debt and portfolio equity to developing countries. (The FDI flows to developing countries show here exclude China.) Remittances have been larger than development assistance for some years now, and the gap is growing. Perhaps more surprising, remittances also outstripped debt and portfolio equity flows to developing countries in recent years. The flows of remittances also look quite stable compared to other private-sector capital flows."
Conversable Economist: Americans, Led by Democrats, Get Friendlier With Free Trade
" ... I welcome the overall shift toward a more positive view of foreign trade among Americans. As I've argued on this blog before, the next few decades seem likely to be a time when the most rapid economic growth is happening outside the high-income countries of the world, and finding ways for the US economy to connect with and participate in that rapid growth could be an important driver of US economic growth in the decades ahead. In a broad sense, US attitudes over foreign trade mirror the behavior of the US trade deficit: that is, when the US trade deficit was getting worse in the early 2000s, the share of those viewing trade as a "threat" was rising, but at about the same time that the US trade deficit started declining, the share of those viewing trade as an "opportunity" started to rise.
Pew Research Center: Chart of the Week: How two decades of globalization have changed the world
(Source: Milanovic, B., Lead Economist, World Bank Research Department, Global income inequality by the numbers. Annotations by James Plunkett.)
I have seen the unannotated version of this graph several times, but the annotations really make things clear. The graph shows that much more is going on here than simplistic narratives of "The rich are getting richer, and the poor are getting poorer" (the graph discredits the second half of that statement) and the 1% versus everyone else.
1. Economist: March of the Middle Class
2. Chrsitianity Today: Poverty Is a Moral Problem - Interview with William Easterly
... The sad thing is that the field and practice of development have too often been on the wrong side of this debate. They've implicitly painted themselves into a corner where they're on the authoritarian side. Then they're backing the autocrats, backing the oppressors against the oppressed. ...
... Any advice for a 20-year-old reading this article who wants to "change the world"?
I love young people who want to change the world!
I think we need rebalancing. A large share of the effort has been going to direct technical solutions to poverty. But this has neglected the other option of advocacy and education for rights as an important moral goal. Rights also work to promote development. ...
3. BBC: Ending poverty needs more than growth, World Bank says
... "This is simply not enough, and we need a laser-like focus on making growth more inclusive and targeting more programmes to assist the poor directly if we're going to end extreme poverty." ...
4. Mashable: 64% of World's Extreme Poor Live in Just 5 Countries
... Using the most recent data from 2010, the report shows that nearly two-thirds of the extremely poor — that is, those who live on less than $1.25 a day — live in just five countries: India, China, Nigeria, Bangladesh and the Democratic Republic of Congo. ...
5. Wired: The Hyper-Efficient, Highly Scientific Scheme to Help the World’s Poor
... How did ICS know the campaign would work? It made sense in theory—free textbooks should mean more kids read them, so more kids learn from them—but they had no evidence to back that up. On the spot, Kremer suggested a rigorous way to evaluate the program: Identify twice the number of qualifying schools as it had the money to support. Then randomly pick half of those schools to receive the textbooks, while the rest got none. By comparing outcomes between the two cohorts, they could gauge whether the textbooks were making a difference.
What Kremer was suggesting is a scientific technique that has long been considered the gold standard in medical research: the randomized controlled trial. At the time, though, such trials were used almost exclusively in medicine—and were conducted by large, well-funded institutions with the necessary infrastructure and staff to manage such an operation. A randomized controlled trial was certainly not the domain of a recent PhD, partnering with a tiny NGO, out in the chaos of the developing world. ...
6. Christianity Today: How Female Farmers Could Solve the Hunger Crisis
... This gender inequality carries desperate consequences. Lack of basic tools and training means women grow and harvest significantly lower yields than men – not because they can't farm as well, but because they don't have necessary resources. In fact, female farmers do more to increase food security in rural communities than men. Women cultivate vegetable gardens and edible crops close to home, which allows them to watch their children and cook meals. In contrast, men tend to travel further from the house to grow cash crops like tobacco, coffee, and corn – crops that do little to supplement diet. ...
7. Businessweek: Have Higher Food Prices Actually Helped the World's Poor?
... Data, however, pointed in the other direction: The number of people in developing countries who reported that there had been times in the past 12 months when they didn’t have enough money to buy the food their family needed fell by hundreds of millions (PDF) from 2005 to 2009. In 2013 improved FAO estimates backed up the earlier polling reports: The numbers suggested that 842 million people in the 2011-13 period were unable to meet their dietary energy requirements, down nearly 6 percent (PDF) from 893 million people in the 2005-07 period. ...
... Heady suggests the fundamental assumption of previous poverty prediction models—that because poor people eat more food than they grow, they’re hurt by higher prices—did not account for the impact of food prices on wages. In a lot of places, as the prices of food rose, poor people earned more money. Even though they were paying more for food, their increased incomes more than made up for that and they got a little richer. In Bangladesh, for example, rural wages adjusted for the price of food increased by about a third from the middle of 2006 to the end of 2010. (Urban wages remained essentially unchanged.) ...
8. MR University: Water and common pool problem
The general logic here applies to a large number of problems in economic development, not just water. This is one of the key ideas of the theory of property rights.
9. Atlantic: How Sanitary Pads Can Help Women Improve Their Health and Education
... That's the little formula that's fueling Arunachalam Muruganantham's thriving sanitary-pad machine business, an undertaking that's not only making Muruganantham money, but one that will improve women’s hygiene in India and throughout the developing world.
Many women living in poverty use rags, newspaper, or even mud to manage their menstrual periods. None of these work very well and can introduce infections or injuries; they also circumscribe women’s movement. Often, women fear being in public without protection from blood staining. ...
10. Business Insider: Here's Why Mexico Is Increasingly Becoming A Crucial Global Manufacturing Hub...
However, another big beneficiary of rising Chinese labor costs and U.S. economic growth has been Mexico. This has come despite concerns about crime and safety.
Mexico benefits from the North America Free Trade Agreement (NAFTA). At 44, it also has more free-trade agreements than any other country. Mexico also benefits from having its natural gas prices tied to those in the U.S. where prices are substantially lower relative to the rest of the world.
Average electricity costs are about 4% lower in Mexico than in China, and the average price of industrial natural gas is 63% lower, according to a study by the Boston Consulting Group.
The same study found that by 2015, average manufacturing-labor costs in Mexico are projected to be 19% lower than in China. In 2000, Mexican labor was 58% more expensive than in China. ...
11. US AID: Full Speed Ahead on Malaria
Today, the greatest success story in global health is anchored by a continent once known mostly for famine and war. Many countries in sub-Saharan Africa are making unprecedented gains in child survival and reducing the devastating burden of malaria—a disease carried by mosquitoes and a major killer of children.
According to the World Health Organization an estimated 3.3 million lives were saved as a result of the scale-up of malaria control interventions over the last decade. Over the same period, malaria mortality rates in African children were reduced by an estimated 54 percent. ...
12. Huffington Post: Africa Is Richer Than You Think
Africa suffers from another kind of poverty: lack of accurate statistical data. And it is a tragic, messy situation. Nigeria nearly doubled the size of its economy overnight -- a whopping 89 percent -- surpassing South Africa to become Africa's largest economy and the world's 26th largest. What was thought to be a $270 billion economy one day became a $510 billion economy the next day, adding some $240 billion to its economy. To put the change into perspective, it is almost like adding Israel's economy, or more than Portugal's, to Nigeria's economy. It sounds like magic but it is not. Inaccurate economic data is commonplace across much of Africa. ...
13. Atlantic: How to Make Solar Panels Affordable—for Billions
Like the installment plans of the Great Depression, Simpa Networks' "Progressive Purchase" agreements are enabling customers in rural India to get solar power for their homes. ...
14. PBS: Capitalism in Cuba? It’s closer than the U.S. may think
... As an economist who had the opportunity to observe, first-hand, the difficult transitions of China and Russia from state to largely market-based economies, I was astounded by the counter-productive actions of my government. On its own, Cuba was well into a carefully planned transition to a market-based economy. The only impact of additional U.S. meddling would be to set back this process. ...
15. Mashable: 750 Million People Still Don't Have Access to Clean Drinking Water
... Since 1990, 2.3 billion people have gained access to drinking water from improved sources. But despite this progress, 748 million people — 90% of whom live in sub-Saharan Africa and Asia — still use unimproved drinking water sources, according to an updated report the World Health Organization and UNICEF released on Thursday. ...
16. New York Times: What’s So Scary About Smart Girls?
... Why are fanatics so terrified of girls’ education? Because there’s no force more powerful to transform a society. The greatest threat to extremism isn’t drones firing missiles, but girls reading books.
In that sense, Boko Haram was behaving perfectly rationally — albeit barbarically — when it kidnapped some of the brightest, most ambitious girls in the region and announced plans to sell them as slaves. If you want to mire a nation in backwardness, manacle your daughters. ...
17. Businessweek: The Relentless Rise Of Global Happiness
... The rest of the world, however, is different: The average surveyed person planet-wide reports greater happiness than 10 years ago—which was happier than many reported 30 years ago. That said, it turns out that the factors that lead people to self-report as happy aren’t as obvious as you might think. And this suggests the limits of using happiness as a guide for making public policy. ...
... The World Values Survey presents an additional conundrum: While the share of the world population reporting itself happy has climbed since the 1980s, the average score on a question asking people if they are satisfied with life seems to have declined marginally. ...
18. Atlantic: Having Kids Probably Won't Destroy the Planet
An overpopulated planet is not necessarily doomed. What matters most is how those billions of people choose to live. ...
1. AEI - James Pethokoukis: What MinuteClinics and Google Fiber teach about crony capitalism
... Andy Kessler explains how established Internet service providers are trying to block Google from deploying Google Fiber, its superfast, gigabit broadband service. His solution: “The FCC can change this overnight. Instead of allowing municipalities to dictate onerous terms and laws that lock in (slow) incumbents, the FCC can mandate right-of-way rules similar to those granted Google Fiber to all credible competitors. If only the federal regulator would promote progress and focus on what’s best for the U.S. economy rather than for those it regulates.” Regulation should promote innovation and competitive churn, not protect revenue streams of existing players.
There is a big difference between being pro-business and pro-market. One does the bidding of incumbents, with the result being a static economy. The other promotes competition. Safety nets are for people, not businesses. The result is innovation and dynamism. Right now, America has too much of the former, not enough of the latter.
2. Economist: The politics of poverty. Another two cents.
... Within this miscellany [of the Ryan budget] there are some clues as to the future direction of Republican anti-poverty policies. Mr Ryan recently gave a speech in which he praised Britain’s Universal Credit, a plan to roll lots of government anti-poverty programmes into one. In some ways Britain is a strange place to seek inspiration: the British scheme is hopelessly behind schedule, a victim of the kind of IT snafu that has hobbled the Affordable Care Act. But the thinking behind it is sensible.
The other initiative that looks to have Mr Ryan’s blessing is the expansion of the Earned-Income Tax Credit (EITC) to people who do not have children (at the moment the childless are eligible for this credit but there is a low cap on the maximum payment they may receive). Marco Rubio has already spoken in favour of this. The report from the House budget committee cites plenty of evidence on the power of EITCs to boost the number of people in work. The president’s budget, published on March 4th, includes an expansion of this programme too. ...
3. Bloomberg: Free-Market Bashers Aren't Helping the Poor
... There's a more basic flaw in the thesis that markets have done nothing to help the poor while government programs have done a lot: Where does the government get the money to fund these programs? Economic growth is what enables Social Security checks to get fatter over time. Unless you're prepared to argue that the government is responsible for 100 percent of economic growth and markets for none, markets have to get some of the credit for whatever good government does. ...
... Both markets and government are necessary to improve the lot of the poor, and we ought to reform government programs so that they do a better job of helping the poor participate in markets. That's just common sense, and no study or statistic has given us a good reason to reject it.
4. AEI - James Pethokoukis: Has America finally reached peak food-stamp enrollment?
5. Carpe Diem: US household net worth increased to a new record high of $80.6T in Q4, fueled by stock market and housing gains
6. Bloomberg: Decoupling Happened: U.S. Stocks Soared, China's Shrugged
The idea that emerging markets could keep growing smartly despite the collapse of the U.S. was something romanced quite a bit in recent years. Decoupling, as it’s called, was at least numerically possible. After all, China, Brazil, India, and Russia—the planet’s four biggest emerging economies, which chipped in two-fifths of global economic growth in the year leading up to Wall Street’s 2008 collapse—stood out as the least dependent on exports to America. Upwards of 95 percent of China’s double-digit growth was attributable to domestic demand.
Turns out a decoupling did transpire in the five years since peak meltdown—only it’s the U.S. market that seems to be doing fine while China founders. It’s a divergence of fortunes few would have predicted. ...
7. Slate: The “Made in China” Fallacy
... But are iPhones really “made in China”? More than a dozen companies from at least five countries supply parts for them. Infineon Technologies, in Germany, makes the wireless chip; Toshiba, in Japan, manufactures the touch screen; Broadcom, in the U.S., makes the Bluetooth chips that let the devices connect to wireless headsets or keyboards.
Analysts differ over how much of the final price of an iPhone or an iPad should be assigned to which country, but no one disputes that the largest slice should go not to China but to the U.S., where the design and marketing of such devices take place at Apple’s headquarters in Cupertino, Calif. The largest source of an iPhone’s value—and this goes for thousands of other high-tech products—lies not in its physical hardware but in its invention and the work of the individuals who conceived, designed, patented, packaged, and branded the device.
Taking these facts into account would leave China, the supposed country of origin, with a paltry piece of the pie. The Asian Development Bank estimates that as little as $10 of the value of every iPhone or iPad actually ends up in the Chinese economy.
Now magnify this across hundreds, even thousands of finished goods. Those Nike shoes that count as imports from China, all those flat-screen televisions, Android phones, clothing, furniture, Disney toys and figures. Almost all are the result of ideas generated in the U.S. (or Japan, or Germany, or Korea, and so on), with parts sourced globally and then assembled in China to be sold elsewhere. ...
8. Project Syndicate: The Poverty of Renewables
... Forcing everyone to buy more expensive, less reliable energy pushes up costs throughout the economy, leaving less for other public goods. The average of macroeconomic models indicates that the total cost of the EU’s climate policy will be €209 billion ($280 billion) per year from 2020 until the end of the century.
CommentsView/Create comment on this paragraphThe burden of these policies falls overwhelmingly on the world’s poor, because the rich can easily pay more for their energy. I am often taken aback by well-meaning and economically comfortable environmentalists who cavalierly suggest that gasoline prices should be doubled or electricity exclusively sourced from high-cost green sources. That may go over well in affluent Hunterdon County, New Jersey, where residents reportedly spend just 2% of their income on gasoline. But the poorest 30% of the US population spend almost 17% of their after-tax income on gasoline. ...
9. New York Times - Economix: Q. and A.: A Development Expert on Narrowing Inequality
Branko Milanovic has been studying income inequality around the world for a long time. ...
... Inequality calculated among all individuals in the world, as if they were part of one single nation, has been edging slightly downward over the past 10 to 15 years, mostly thanks to very high growth rates in China and India. These relatively poor giants (particularly India) have pulled quite a lot of people out of poverty and into something that can be called “the global middle class.”
That is the key factor behind the decline of global inequality: The distance between their incomes and the rather stagnant incomes of the middle class in rich countries has diminished. Yet global inequality is still extremely high by the standards of any single country. It is, for example, significantly higher than inequality in South Africa, which is the most unequal country in the world. ...
10. Prospect: “I started off as a libertarian economist, but I’ve come full circle”—Gregory Clark on social mobility
... If you look at England, for example, what we measure is whether you were at Oxford or Cambridge; how long you live, which is another good indicator of social status; occupational status; are you a member of parliament? Now one of the interesting findings here is that it doesn’t really matter which measure you use. For the families we’re looking at, all these things are actually highly correlated. The wealthy at any time are also the educated, members of parliament, those who live long. What the book shows is that there’s an underlying physics of social mobility which all of our political efforts seem to have no effect upon. And the startling conclusion is that we may never be able to change social mobility rates. ...
11. Business Insider: Every 25-Year-Old In America Should See This Chart
12. Business Insider: 13 Money Lies You Should Stop Telling Yourself By Age 40
... By the time you hit 40, rationalizing away your bad money management habits starts to have a serious impact on your financial future (not to mention age you).
Here are some of the top money lies that you should stop telling yourself by age 40: ...
13. Huffington Post: 5 Tools to Tackle Finances in Your Twenties
Your twenties are hard enough already: matriculating from college, finding your first "real" job, moving out on your own, learning how to pay bills for the first time and learning how to navigate adult relationships without the structure of college or free flow of alcohol. It is a scary and awkward time, no one disputes that -- but mastering your finances in your twenties will reduce your stress and increase your net worth in the long run. Below are 5 tools you need to tackle finances in your twenties. ...
1. Quartz: Globalization really means countries just trade with their neighbors
2. Business Insider: Europe's Share Of Global Profits Is At A 28-Year Low
3. USA Today: Europe widespread corruption 'breathtaking'
... Meanwhile, the report, which was the first published by the EU to detail people's perceptions of corruption in the union, also said that 76% of Europeans think corruption is widespread, with another 56% saying they thought the level of corruption in their country had increased over the past three years.
"I think the perception is almost as important as the reality of how much corruption there is because if people feel that the national or EU institution is corrupt, it clearly is an indication of a lack of confidence, a lack of trust and a lack of respect for those governing institutions," said Ben Tonra, a professor of European foreign, security and defence policy at University College Dublin. ...
4. National Review: Welfare, Here and Abroad
How bad have things become? The British newspaper the Telegraph recently looked at the growth in welfare spending in industrialized nations and found that such spending (including health-care and pension programs) had grown faster in the United States since 2000 than in any country in Europe except Ireland, Spain, and Portugal.
Of course, European welfare states were larger to begin with, but the Telegraph’s report is reflective of an important trend. While the Obama administration presses forward with efforts to combat “income inequality” by expanding the American welfare state, the European nations and other industrialized welfare states are moving in the other direction.
A few examples: ...
5. Economist: The parable of Argentina
There are lessons for many governments from one country’s 100 years of decline ...
... Why dwell on a single national tragedy? When people consider the worst that could happen to their country, they think of totalitarianism. Given communism’s failure, that fate no longer seems likely. If Indonesia were to boil over, its citizens would hardly turn to North Korea as a model; the governments in Madrid or Athens are not citing Lenin as the answer to their euro travails. The real danger is inadvertently becoming the Argentina of the 21st century. Slipping casually into steady decline would not be hard. Extremism is not a necessary ingredient, at least not much of it: weak institutions, nativist politicians, lazy dependence on a few assets and a persistent refusal to confront reality will do the trick. ...
6. Matt Ridley: Few people know that global inequality is falling and so is poverty
... None of this is meant to imply that people are wrong to resent inequality in income or wealth, or be bothered about the winner-take-all features of executive pay in recent decades. Indeed, my point is rather the reverse: to try to understand why it is that people mind so much today, when in many ways inequality is so much less acute, and absolute poverty so much less prevalent, than it was in, say, 1900 or 1950. Now that starvation and squalor are mostly avoidable, so what if somebody else has a yacht?
The short answer is that surely we always have and always will care more about relative than absolute differences. This is no surprise to evolutionary biologists. The reproductive rewards went not to the peacock with a good enough tail, but to the one with the best tail. A few thousand years ago, the bloke with one more cow than the other bloke got the girl, and it would have cut little ice to try to reassure the loser by pointing out that he had more cows than his grandfather, that they were better cows, or that he had more than enough cows to feed himself anyway. What mattered was that he had fewer cows.
7. Huffington Post: A Post-GDP World? How to Measure Real Progress in America
... GDP actually tends to rise with societal problems such as crime, pollution, household debt, commuting time, and family breakdown. As a short-term measure of economic output, it increases with the depreciation of machinery and the extraction of finite resources, while failing to reflect the long-term contributions of education and entrepreneurship.
In light of these shortcomings, we seek to answer an overarching question in a report to be released in spring 2014: How should the US government institute supplemental national accounts that better reflect the well-being of the nation? The question, like the broader push for GDP reform, stems from a central premise that new comprehensive indicators would lead to better-informed policymaking, and, in turn, genuine advances in the nation's prosperity. We do not presume to replace GDP, which still serves an important although limited purpose, but to supplement it with modern measures of progress. ...
8. Business Insider: Half Of US GDP Comes From The Orange Spots On This Map
9. Legatus Magazine: Business and the option for the poor
... What does living out the option for the poor mean in practice? We must engage in works of charity — those activities that often address specific dimensions of poverty in ways that no state program ever could. And this means giving of our time, energy, and human and monetary capital in ways that bring Christ’s light into some of the darkest places on earth.
Yet this does not mean that Catholics are required to give something to everything, or even that Catholics must give away everything they own. As Fr. James Schall, SJ, writes, “If we take all the existing world wealth and simply distribute it, what would happen? It would quickly disappear; all would be poor.” Put another way, living out the option for the poor may well involve those people with a talent for creating wealth doing precisely that.
The option for the poor, however, does not rule out any form of government assistance to those in need. Yet lifting people out of poverty — and not just material poverty but also moral and spiritual poverty — does not necessarily mean that the most effective action is to implement yet another welfare program. There is no reason to assume that the preferential option for the poor is somehow a preferential option for big government. Often, being an entrepreneur and starting a business which brings jobs, wages, and opportunities to places where they did not hitherto exist is a greater exercise of love for the poor (and usually far more economically effective) than another government welfare initiative. ...
10. New York Times: Can Marriage Cure Poverty?
... “It isn’t that having a lasting and successful marriage is a cure for living in poverty,” says Kristi Williams of Ohio State University. “Living in poverty is a barrier to having a lasting and successful marriage.” ...
... In an economy that offers so little promise to those at the bottom, family planning in the name of upward mobility doesn’t make much sense. “Engaging in family formation by accident rather than by design, you get a story of low-opportunity costs,” says Kathryn Edin, the poverty researcher at Johns Hopkins. “We’ve created the situation where pregnancy is not the worst thing that can happen to you. It can be seen as a path to redemption in an otherwise violent, unpredictable, hopeless world.”
Similar forces might also spur some young couples not to get married, even if they want to. Many poor women opt not to marry the poor men in their lives, for instance, to avoid bringing more economic chaos into their homes. And the poor women who do marry tend to have unstable marriages — often to ill effect. One study, for instance, found that single mothers who married and later divorced were worse off economically than those who did not marry at all. “These women revere marriage, they want to get married,” Williams says. “They aren’t making an irrational choice not to marry.” ...
11. Atlantic Cities: How Anti-Poverty Programs Marginalize Fathers
... U.S. government programs designed to help such families, however, haven't evolved with the population. Based on decades-old stereotypes that single mothers are raising children alone and single dads are "deadbeats," the majority of United States anti-poverty programs almost exclusively serve women and children, says Jacquelyn Boggess, co-director of the Center for Family Policy and Practice,* a Wisconsin-based think tank that focuses on supporting low-income parents. The welfare system, as a result, can become a muddled mess of rearranging rather than relieving poverty. Single, non-custodial fathers bear the brunt. But dads don’t suffer alone. Because the poor pull together to support one another, everyone absorbs the pinch. ...
12. Investors: Low-Wage Hours At New Low As ObamaCare Fines Loom
... It's impossible to know how much of the drop relates to ObamaCare, but there's good reason to suspect a strong connection. The workweek has been getting shorter in many of the same industries where anecdotes have piled up about employers cutting hours to evade the law's penalties. ...
13. Business Insider: Very Few American Workers Actually Make The Minimum Wage
... "We do not know the share of individuals (or wages) who are just above the minimum wage and whose wages might also rise with an increase, but we do know that it is likely still a small proportion," they write.
"The current minimum wage is well below the economy-wide average. Even for low-paying sectors like retail trade and leisure and hospitality — where the average hourly wage in 2013 was $13.50 and $16.60, respectively — the current minimum is a fair bit lower. These data also suggest a relatively small share of total wage income that would be directly impacted by any increase in the federal (or various state) minimums."
So while the minimum wage debate may be a hot-button political issue, it is somewhat irrelevant from an economic perspective.
14. The Atlantic: Liberals Need to Think Beyond the Minimum Wage
A new report from the Congressional Budget Office says a hike would help the working class, but less than many might hope. ...
15. New York Times: Evaporating Unemployment
Before the recession, in December 2007, about 63 percent of American adults had jobs. Six years later, in December 2013, less than 59 percent of adults had jobs.
And a new analysis says that the recession has very little to do with it.
The study, by two economists at the Federal Reserve Bank of New York, asserts that workforce participation is in long-term decline. If the recession had never happened, or the economy had since returned to complete health, the authors estimate 59.3 percent of adults would have jobs, instead of 58.6 percent. ...
16. Business Insider: Why 12.7 Million Americans Dropped Out Of The Workforce
17. Conversable Economist: Halfway to Full Economic Recovery
... In short, although the prediction is that the U.S. economy is roughly halfway from the end of the recession to a full economic recovery, this is a case where the glass is actually half-full, rather than half-empty, because the heartier period of economic growth is coming. Here are a few of the details. ...
19. Forbes: Charitable Giving Grew 4.9% In 2013 As Online Donations Picked Up
... Charitable giving revenue grew 4.9% in 2013, the largest gain since the 2008 recession. U.S. based organizations with annual fundraising over $10 million saw 5% growth. Those that receive $1 million to $10 million in gifts gained 3.8% and the smallest nonprofits – less than $1 million raised annually – grew 3.6%. ...
... The tables, however, turn with online giving revenue which, at 13.5% growth overall, had its second consecutive year of double-digit gains. ...
20. NPR: Economist Says Best Climate Fix A Tough Sell, But Worth It
... "When we did our first calculations, they actually spun out these 'shadow prices,' " he says. "And I remember looking at them and trying to think ... what in the world does that mean?"
The shadow prices, he realized, actually represented the cost of putting carbon dioxide into the atmosphere. And with that, climate change suddenly became a problem that could be attacked with the tools of economics.
"Actually from an economic point of view, it's a pretty simple problem," he says.
If people would simply pay the cost of using the atmosphere as a dump for carbon dioxide, that would create a powerful incentive to dump less and invest in cleaner ways to generate energy. But how do you do that?
"We need to put a price on carbon, so that when anyone, anywhere, anytime does something that puts carbon dioxide in the atmosphere, there's a price tag on that," he says.
His colleagues say that inspiration — now taken for granted — makes Nordhaus a prime candidate for a Nobel Prize. A lot of his work has been figuring out how big a price we should pay, and what form it should take. ...
21. New York Times: Your Ancestors, Your Fate
Inequality of income and wealth has risen in America since the 1970s, yet a large-scale research study recently found that social mobility hadn’t changed much during that time. How can that be?
The study, by researchers at Harvard and Berkeley, tells only part of the story. It may be true that mobility hasn’t slowed — but, more to the point, mobility has always been slow.
When you look across centuries, and at social status broadly measured — not just income and wealth, but also occupation, education and longevity — social mobility is much slower than many of us believe, or want to believe. This is true in Sweden, a social welfare state; England, where industrial capitalism was born; the United States, one of the most heterogeneous societies in history; and India, a fairly new democracy hobbled by the legacy of caste. Capitalism has not led to pervasive, rapid mobility. Nor have democratization, mass public education, the decline of nepotism, redistributive taxation, the emancipation of women, or even, as in China, socialist revolution.
To a striking extent, your overall life chances can be predicted not just from your parents’ status but also from your great-great-great-grandparents’. The recent study suggests that 10 percent of variation in income can be predicted based on your parents’ earnings. In contrast, my colleagues and I estimate that 50 to 60 percent of variation in overall status is determined by your lineage. The fortunes of high-status families inexorably fall, and those of low-status families rise, toward the average — what social scientists call “regression to the mean” — but the process can take 10 to 15 generations (300 to 450 years), much longer than most social scientists have estimated in the past. ...
1. Brookings: Prospects for Ending Extreme Poverty by 2030
2. Carpe Diem: World trade and output both reached new all-time record highs in November and are nearly 10% above previous peaks
3. PBS Newshour: More than 200 million people were unemployed in the world in 2013
Worldwide, the number of unemployed people rose by 5 million in 2013 to 202 million, according to the International Labor Organization’s Global Employment Trends report. The global unemployment ratio of youth to adults has reached a new high. The jobless rate for 15- to 24-year-olds hit 13.1 percent in 2013 (or 74.5 million), nearly three times the adult rate.
The organization predicts unemployment will worsen, with 215 million jobless by 2018. Roughly 40 million net jobs will be added each year, the ILO estimates, but that won’t be enough to absorb the 42.6 million people expected to enter the labor force each year. ...
4. Conversable Economist: Limited U.S. Power in a Globalizing Economy
Just to be clear, the U.S. economy is not becoming a economic minnow like Belize or Burundi. But 65 years ago, as the high-income countries climbed out of the wreckage left by World War II and today's emerging economies had not yet engaged in the global economy, the U.S. economy had an extraordinary time of dominance. For a time in the 1960s, it was common to hear that the planned economy of the USSR would outstrip the U.S. economy. In the 1970s and into the 1980, Japan was going to rule the world economy. Around 2000 and the launch of the euro, there was talk about the economic rise of the European Union. But now, we are seeing the rise of a multipolar and distributed world economy, with faster growth happening in the emerging economies, but with stronger linkages of trade and global supply chains reaching across the world economy. The U.S. can certainly be an active and leading participant in shaping the world's economic future. But neither the U.S., nor some combination of high-income countries around the world, has the power to dictate what configurations will emerge.
5. Business Insider: Here's A Chart Of Interest Rates Going Back To 3000 BC
6. PBS: Is the famous ‘paradox of choice’ a myth? Barry Schwartz
"Paradox of choice" is tha notion that too many choices become overwhelming and make life decisions less satisying.
... Often people choose on the basis of essentially irrelevant features of plans, just because the relevant features are too complex to evaluate. Has anyone ever suggested that the sensible alternative to too many options is a single option? Absolutely and unequivocally not. Psychology has known about “single option aversion” for a half century. With too few options, there is the risk that none will be satisfactory, whereas with too many, there is the risk of paralysis, confusion and dissatisfaction.
The trick is to find the middle ground — the “sweet spot” — that enables people to benefit from variety and not be paralyzed by it. Choice is good, but there can be too much of a good thing. Adam Grant and I recently published a paper suggesting that this “too much of a good thing” phenomenon is pervasive in psychology. ...
7. TED: Paul Piff - Does money make you mean?
"It's amazing what a rigged game of Monopoly can reveal. In this entertaining but sobering talk, social psychologist Paul Piff shares his research into how people behave when they feel wealthy. (Hint: badly.) But while the problem of inequality is a complex and daunting challenge, there's good news too. (Filmed at TEDxMarin.)"
8. Forbes: Downton Abbey Makes A Powerful Case For Economic Freedom
... One of the great things about Downton Abbey is that it allows fans to escape their worries and fantasize about life on a luxurious estate in early 20th century England. But the truth is, few of us could tolerate what we’d be forced to live with, and live without, in that world. ...
9. Carpe Diem: The middle class is shrinking ... because they are moving into the upper class! Census data on income distribution reveal evidence of rising income levels for a rising share of American households
10. AEI: This chart shows how tough it is for the poor to recover from a bad start in life
11. Business Insider: Millennials Are The Most Financially Conservative Generation Since The Great Depression
... According to a new report from investment banking company UBS, Millennials are the most financially conservative generation to come around since the Great Depression. The report, which focused on investors between the ages of 21 and 36, found that Millennials are risk averse when it comes to investing — dedicating 52% of their investment portfolios to cash, compared to 23% cash for other investors. They are also more likely to believe that working hard (69%) and living frugally (45%) puts you on the path to success rather than long-term investing (28%). ...
12. NPR: The Middle Class Took Off 100 Years Ago ... Thanks To Henry Ford?
January 1914 was a frigid month in Detroit — much like January 2014 has been, but nonetheless thousands lined up in the bitter cold outside to take Henry Ford up : $5 a day, for eight hours of work in a bustling factory.
That was more than double the average factory wage at that time, and for U.S. workers it was one of the defining moments of the 20th century. Five dollars in 1914 translates to roughly $120 in today's money. While many economists say today's employers could take some pointers from Ford, they also say 2014 is a totally different world for U.S. businesses and workers. ...
... "It was mainly to stabilize the workforce. And it sure did," Kreipke says. "And raised the bar all over the world."
He says to understand why Ford thought this was a smart move in January 1914, you have to go back to another huge shift that happened a few months earlier: By 1913, Model T production totaled 200,000 — a feat made possible by the creation of the first moving assembly line. Conveyor belts transported small parts to workers, each of whom performed a specific task.
This tremendously sped up production, but Ford still had a problem: While he had standardized production, he hadn't standardized his workforce. Now, he didn't need particularly skilled workers; he just needed ones who would do the same repetitive, specialized tasks hour after hour, day after day.
Kreipke says there was chronic absenteeism and lots of worker turnover. So Ford gambled that higher wages would attract better, more reliable workers. ...
... "Today, overwhelmingly employers view the lowest wage as the most competitive wage," Shaiken says.
These days, global supply chains feed a hypercompetitive auto industry where no one wants to give up even an inch of ground, and keeping up with technology takes precedent over stabilizing the workforce. This just isn't Henry Ford's economy anymore, Shaiken says.
"There are very real economic pressures out there that push down on wages," he says. "So it's not a simple story, but that doesn't mean that there isn't a core truth into what Ford found." ...
13. Business Insider: An Economist Explains Why Wage Growth Is Poised To Take Off
14. Conversable Economist: U.S. Household Finances Rebound
15. Greg Mankiw: Does income inequality increase mortality?
Angus [Deaton] writes the following (emphasis added):
Darren Lubotsky and I 7 have investigated the relationship between income inequality, race, and mortality at both the state and metropolitan statistical area level. In both the state and the city data, mortality is positively and significantly correlated with almost any measure of income inequality. Because whites have higher incomes and lower mortality rates than blacks, places where the population has a large fraction of blacks are also places where both mortality and income inequality are relatively high. However, the relationship is robust to controlling for average income (or poverty rates) and also holds, albeit less strongly, for black and white mortality separately. Nevertheless, it turns out that race is indeed the crucial omitted variable. In states, cities, and counties with a higher fraction of African-Americans, white incomes are higher and black incomes are lower, so that income inequality (through its interracial component) is higher in places with a high fraction black. It is also true that both white and black mortality rates are higher in places with a higher fraction black and that, once we control for the fraction black, income inequality has no effect on mortality rates, a result that has been replicated by Victor Fuchs, Mark McClellan, and Jonathan Skinner9 using the Medicare records data. This result is consistent with the lack of any relationship between income inequality and mortality across Canadian or Australian provinces, where race does not have the same salience. Our finding is robust; it holds for a wide range of inequality measures; it holds for men and women separately; it holds when we control for average education; and it holds once we abandon age-adjusted mortality and look at mortality at specific ages. None of this tells us why the correlation exists, and what it is about cities with substantial black populations that causes both whites and blacks to die sooner.
In a review of the literature on inequality and health, I note that Wilkinson's original evidence, which was (and in many quarters is still) widely accepted showed a negative cross-country relationship between life expectancy and income inequality, not only in levels but also, and more impressively, in changes. But subsequent work has shown that these findings were the result of the use of unreliable and outdated information on income inequality, and that they do not appear if recent, high quality data are used. There are now also a large number of individual level studies exploring the health consequences of ambient income inequality and none of these provide any convincing evidence that inequality is a health hazard. Indeed, the only robust correlations appear to be those among U.S. cities and states (discussed above) which, as we have seen, vanish once we control for racial composition. I suggest that inequality may indeed be important for health, but that income inequality is less important than other dimensions, such as political or gender inequality.10
16. Pew Research: There's More to the Story of the Shrinking (Gender) Pay Gap
17. The Daily Beast: No, Women Don’t Make Less Money Than Men
... In its fact-checking column on the State of the Union, the Washington Post included the president’s mention of the wage gap in its list of dubious claims. “There is clearly a wage gap, but differences in the life choices of men and women… make it difficult to make simple comparisons.” ...
... Much of the wage gap can be explained away by simply taking account of college majors. Early childhood educators and social workers can expect to earn around $36,000 and $39,000, respectively. By contrast, petroleum engineering and metallurgy degrees promise median earnings of $120,000 and $80,000. Not many aspiring early childhood educators would change course once they learn they can earn more in metallurgy or mining. The sexes, taken as a group, are somewhat different. Women, far more than men, appear to be drawn to jobs in the caring professions; and men are more likely to turn up in people-free zones. In the pursuit of happiness, men and women appear to take different paths.
But here is the mystery. These and other differences in employment preferences and work-family choices have been widely studied in recent years and are now documented in a mountain of solid empirical research. By now the President and his staff must be aware that the wage gap statistic has been demolished. This is not the first time the Washington Post has alerted the White House to the error. Why continue to use it? ...
18. Atlantic: How When Harry Met Sally Explains Inequality
A new study says that educated people marrying each other has increased inequality by 25 percent.
19. Reuters: The real future of U.S. manufacturing
... The assertion that the United States, or any nation, requires continued investment in the technologies that will drive future production is indisputable. On that score, at least, the Obama White House is fighting the proverbial good fight.
The contention, however, that these technologies and the factories that harness them for production will be sources of well-paid, solidly middle-class jobs, is flawed. In our political debates, we maintain the comforting fiction that a manufacturing revival can and will go hand-in-hand with a jobs revival. Yet, as Obama’s initiative shows, the two can be — and increasingly are — uncoupled.
The issue is not the hollowing-out of manufacturing as defined by less production. Yes, many less expensive, simpler products are now made more cheaply elsewhere and are unlikely to be made in the United States anytime soon — even with the “on-shoring” of manufacturing. Though China ceases to be the place of low-cost production, Vietnam, the Philippines and who knows where else (even Mexico) will be more attractive for apparel, furniture, electronics and anything plastic for a long time to come.
The high-end production that these new U.S. innovation hubs seek to promote is indeed in demand around the world. It is something where, as yet, China and other low-cost manufacturing centers have not excelled. This is why China actually imports considerable billions of higher-end equipment – particularly from Japan and Germany. So it is true that the United States could have a competitive advantage, especially given the plethora of research universities and the wealth of highly-educated talent that can be used for just this type of production.
But all this is not the same as a job creator for a workforce of at least 120 million and counting in nation of more than 320 million people. These high-tech factories might employ hundreds of people in conjunction with industrial robots, using sophisticated software systems for design and production. These factory workers bear little resemblance to the 1950s line workers doing rote tasks. They are more like Silicon Valley engineers or lab technicians. These are high-skill jobs — and not nearly as plentiful as the factory jobs of the past. ...
Related: Bloomberg - Factory Jobs Are Gone. Get Over It
... In 1953 manufacturing accounted for 28 percent of U.S. gross domestic product, according to the U.S. Bureau of Economic Analysis. By 1980 that had dropped to 20 percent, and it reached 12 percent in 2012. Over that time, U.S. GDP increased from $2.6 trillion to $15.5 trillion, which means that absolute manufacturing output more than tripled in 60 years. Those goods were produced by fewer people. According to the Bureau of Labor Statistics, the number of employees in manufacturing was 16 million in 1953 (about a third of total nonfarm employment), 19 million in 1980 (about a fifth of nonfarm employment), and 12 million in 2012 (about a tenth of nonfarm employment).
Service industries—hotels, hospitals, media, and accounting—have taken up the slack. Even much of the value generated by U.S. manufacturing involves service work—about a third of the total. More than half of all people still employed in the U.S. manufacturing sector work in such services as management, technical support, and sales. ...
20. PBS: Paul Soloman on Man vs the Machine: Will Human Workers Become Obsolete?
21. Huff Post: The End of Capitalism
Interesting thoughts. I don't know if he has it just right, but I do think he is correct that we may be on the verge of something as transformative to capitalism as industrialization was to agricultural societies:
... The location of creation has switched. Under industrial capitalism, machines operating centrally created riches. James Watt perfected his steam engine, but then the machines took on a life of their own - the machines themselves, and machine-like corporations built around them, churned out money. People danced around the edges, enlarging and improving the machines, putting them together in large mills or mines to turbo-charge productivity, adapting their pace of work to that of the machines. The machines and the capitalists were in charge.
Now it is not machines or their owners, but creative individuals who are center-stage. People not only invent new technology - they are the new technology. As sociologist Manuel Castells says, "For the first time in history, the human mind is a direct productive force ... Computers, communication systems, and genetic decoding and programming are all amplifiers and extensions of the human mind."
In the West, knowledge has become personalized. Open innovation requires it. The effect of open innovation is to transfer initiative and wealth from established corporations to new ones, and from shareholders to individuals. From thought to action, individuals are at the heart of creation, including wealth creation. Every element of the unique human personality takes part in creation - intellect, imagination, emotion, calculation, empathy, and the ability to evoke enthusiasm from other seriously talented people. Each person does it their way. Steve Jobs may not have been the nicest person in Silicon Valley, but he got amazingly talented people to distort reality and create previously unimaginable products. The individual is everything.
In all kinds of ways, therefore, we are moving away from capitalism, from an economy centered on capital and large, established, hierarchical corporations. But we are not moving from private hierarchy to public hierarchy, from capitalism to socialism or communism. Free enterprise is alive and well - arguably too alive and well. The new system is even more market-oriented than capitalism, and much more decentralized. It is as decentralized as any system can possibly be, because it is decentralized to individuals, and above all to a tiny minority of new superstar individuals. Welcome to the personalized economy. ...
22. Carpe Diem: Cash for kidneys will solve the organ shortage, save money spent on dialysis, and then we’ll wonder why it took so long
(Not necessarily agreeing here. Just reporting.)
Economists Gary Becker and Julio Elias make the case in today’s WSJ that a market for organs and donor compensation of about $15,000 would eliminate the growing kidney shortage. As the chart above shows, the kidney waiting list has nearly doubled from 50,000 in 2001 to almost 99,000 today, while the number of annual kidney transplant operations has increased only slightly from 14,279 in 2001 to fewer than 17,000 in 2013. Over the last eight years, kidney transplants have remained stuck at slightly below 17,000 per year, while the kidney waiting list has swelled by almost 30,000. Therefore, there an additional 30,000 patients today (99,000) than in 2006 (69,600) competing for the same number of transplants. And that’s why, as Becker and Elias point out, the average waiting time for a kidney has increased to 4.5 years from 2.9 years a decade ago. The authors argue that “Paying donors for their organs would finally eliminate the supply-demand gap.”
Isn’t donor compensation immoral? No, according to Becker and Elias (emphasis added: ...
Atlantic: Will There Be Any Poor Countries Left in the World in 20 Years?
Bill and Melinda Gates Foundation:
We hear these myths raised at international conferences and at social gatherings. We get asked about them by politicians, reporters, students, and CEOs. All three reflect a dim view of the future, one that says the world isn’t improving but staying poor and sick, and getting overcrowded.
We’re going to make the opposite case, that the world is getting better, and that in two decades it will be better still. ...
... By 2035, there will be almost no poor countries left in the world. Almost all countries will be what we now call lower-middle income or richer. Countries will learn from their most productive neighbors and benefit from innovations like new vaccines, better seeds, and the digital revolution. Their labor forces, buoyed by expanded education, will attract new investments.
Washington Post: 40 charts that explain the world
Our friend and colleague Max Fisher over at Worldviews has posted another 40 maps that explain the world, building on his original classic of the genre. But this is Wonkblog. We're about charts. And one of the great things about charts is that they show not just how things are -- but how they're changing.
So we searched for charts that would tell not just the story of how the world is -- but where it's going. Some of these charts are optimistic, like the ones showing huge gains in life expectancy in poorer nations. Some are more worryisome -- wait till you see the one on endangered species. But together they tell a story of a world that's changing faster than at arguably any other time in human history. ...
As the author notes, we have challenges but hardly descend into a global dystopia. I think these charts give a pretty holistic view. Here are three examples.
It was commonly believed that primitive societies were more peaceful and that modern civilization gave rise to unprecedented violence. This chart compares death rates by war in primitive societies as calculated by anthropologists to those for Europe/USA in the 20th century.
And then there is this:
The graphs point to environmental protection and adaptation as the biggest problems in the days ahead. Those challenges are not insurmountable. Energy sources like natural gas and nuclear power can be used in the interim on the way to practical renewable technologies. Genetically modified crops can help to reduce water consumption, increase yield, and improve hardiness. Innovations in fields like biotechnology, nanotechnology, and 3-D printing promise to revolutionize the world economy into a less wasteful and more affordable human existence for everyone. There is work to do, but there is also much reason for hope of a better world.
1. Business Insider: Meaningful Work — Not Money — Makes People Happy
... Decades of research have boiled human happiness down to just three factors: genes, events, and values. About half of how happy you feel is hardwired into your genetic make up, according to the article. Meanwhile, one-off events like getting married or landing a big promotion can contribute up to 40% of your happiness, but tend to offer just a temporary boost that lasts a few months. ...
2. Atlantic Cities: The Hidden Beauty of a Walmart Store
[4 minute video] A short documentary follows an artist as he paints the inside of the supermarket chain.
3. Atlantic Cities: The Paradox of Diverse Communities
... Their simulations of more than 20 million virtual “neighborhoods” demonstrate a troubling paradox: that community and diversity may be fundamentally incompatible goals. As the authors explain, integration “provides opportunities for intergroup contact that are necessary to promote respect for diversity, but may prevent the formation of dense interpersonal networks that are necessary to promote sense of community.” ...
... After 20 million-plus simulations, the authors found that the same basic answer kept coming back: The more diverse or integrated a neighborhood is, the less socially cohesive it becomes, while the more homogenous or segregated it is, the more socially cohesive. As they write, “The model suggests that when people form relationships with similar and nearby others, the contexts that offer opportunities to develop a respect for diversity are different from the contexts that foster a sense of community.” ...
4. Time: Globalization Isn’t Dead, It’s Only Just Beginning
Once upon a time, globalization simply meant the export of Western culture to the rest of the world. Now the world is turning the tables. ...
... In the past, globalization was to a great degree a one-way street — from the developed to the developing world. Money and technology flowed from the U.S. and Europe into China, India and other low-income countries, drawing them into the global trading system. The process was the same with ideas (democracy, capitalism, Marxism) and culture (popular music, social networking, fast food, Hollywood movies). Emerging nations had few connections between themselves, and limited influence over world politics and finance.
Now, though, the rise of China, India and other emerging economies is shifting that old, one-way globalization into a new, vibrant multilateral globalization, with major consequences for how our world works.
Look at what’s happening in the global economy these days. ...
5. The Interpreter: Unfriending: Japanese public opinion on China <http://www.lowyinterpreter.org/post/2013/01/22/Unfriending-Japanese-public-opinion-on-China.aspx?>
6. Atlantic: Countries With Higher Math Scores Have Unhappier Kids
Is there be a relationship between math and misery? Economist Justin Wolfers runs the math. The variation is pretty large (Eastern Europe seems egregiously unhappy, while southeastern Asian students seem to be having a unduly good time in class), but the correlation is statistically significant.
7. BBC: Modern life 'turning people off sex'
A once-a-decade poll of 15,000 Britons found those aged 16-44 were having sex fewer than five times a month.
The figure compared with more than six times a month on the last two occasions when the official National Survey of Sexual Attitudes and Lifestyles was carried out, in 1990-91 and 1999-2001.
The study's authors say modern life may be having an impact on libidos. ...
8. Atlantic Cities: Across Europe, a Growing Sense That Legalized Prostitution Isn't Working
... France is not alone in its fresh efforts to curb prostitution. The move follows similar bans in Sweden and Norway, while other European countries are also scaling back laissez-faire prostitution policies. Germany is poised to change its liberal sex trade laws, while Ireland is also debating a measure similar to France's. Is the end of legal prostitution in Europe in sight?
It may partly depend on how well France's new laws work. Unlike historical prostitution bans that penalize sex workers, the new laws target customers, making the purchase of sex illegal rather than its sale. Anyone caught paying for sexual services in France will be subject to a fine of €1,500, rising to a maximum of €3,750 for repeat offenders. This follows a model established in Sweden in 1999, but no country as large as France has yet tried anything similar. ...
9. Atlantic: Modern Moms Aren't as Busy as 1960s Moms Were
Moms now spend more time on activities like TV and the computer than on housework, playing with kids, and exercising combined.
10. NPR: Forget Golf Courses: Subdivisions Draw Residents With Farms
When you picture a housing development in the suburbs, you might imagine golf courses, swimming pools, rows of identical houses.
But now, there's a new model springing up across the country that taps into the local food movement: Farms — complete with livestock, vegetables and fruit trees — are serving as the latest suburban amenity.
It's called development-supported agriculture, a more intimate version of community-supported agriculture — a farm-share program commonly known as CSA. In planning a new neighborhood, a developer includes some form of food production — a farm, community garden, orchard, livestock operation, edible park — that is meant to draw in new buyers, increase values and stitch neighbors together. ...
11. Gallup: Majority in U.S. Say Healthcare Not Gov't Responsibility
12. Business Insider: Americans Don't Trust Each Other Anymore
... These days, only one-third of Americans say most people can be trusted. Half felt that way in 1972, when the General Social Survey first asked the question.
Forty years later, a record high of nearly two-thirds say "you can't be too careful" in dealing with people. ...
13. Atlantic: Homelessness Is Up in New York City, But It's Down Everywhere Else
14. Archaeology: Top 10 Discoveries of 2013
15. Business Insider: 25 Books That Changed The Course Of History
Every reader knows that a book can change your life.
But what about the lives of an entire generation? Can a book change the future?
Miriam Tuliao, assistant director of central collection development at the New York Public Library, helped us come up with a list of 25 books that changed the course of history.
From the Torah to Orwell's "1984," these 25 titles have had a major impact (listed here in alphabetical order).
16. Seth's Blog: What do we get when we give to a good cause?
Why on earth would a rational person give money to charity--particularly a charity that supports strangers? What do they get?
A story. ...
... If people aren't donating to your cause, it's because you're not telling a story, or telling the wrong story to the wrong people (in the wrong way). Non-profits make change, and the way they do this is by letting us tell ourselves stories that nurture our best selves.
17. Also on the topic of giving, here is some practical advice. Forbes: How To Give Away Money When It Feels Like You Don't Have Any
Atlantic: All the Countries That Contribute to a Single Jar of Nutella
A great map that gives insight into how the global market works. As I read this, the stories of "I, Pencil" and "I, Smartphone," which I've previously blogged about here, illustrate the amazing complexity of market economies and how things are coordinated.
1. Here's The Chart That Destroys What Republicans Are Saying About The Deficit
2. The 10 Most Popular Charts On The World's Most Amazing Economics Website
Here is one example: Nominal GDP (3.1% growth year over year in Q2):
3. Global trade volume and world industrial production both reached new record highs in July
4. Gas prices dip to eight-month low despite Middle East tumult
Gas prices are at the lowest they've been since late January despite continued unease across the Middle East. Much of the decline in gas prices is part of the seasonal change in supply and demand, but it also reflects a shifting global oil market.
5. 19 Charts That Will Restore Your Faith in the World Economy
Here is one example. Some economists see the Baltic Dry Index as one of the best indicators of global trade and economic vitality:
6. Here Are The Countries That Collect The Most And Least In Taxes
7. Commentary: Robots Taking All Our Jobs? Ridiculous
... If technology enables the same amount of work to be done with fewer people, the argument goes, then it must be bad for employment. More sophisticated variants of this thesis further claim that accelerating technological change has created too much churn in labor markets, and robots are now storming the last few bastions of scarce human abilities.
This tale is not new. The original British Luddites rose up in the early 1800s to oppose mechanization of the textile industry and went so far as to destroy looms that were replacing workers. In the two centuries since, whenever unemployment rates have risen there have been some who blamed the machines. Many even argued that we were heading toward mass permanent unemployment. ...
... Fortunately for workers and for those who understand the potential of new technologies, these ideas are essentially misguided speculation. They fly in the face of years of economic data as well as current trends.
They all fall into what economists call the "Lump of Labor" fallacy, the idea that there's a limited amount of labor to be done. In reality, labor markets aren't fixed. If jobs in one firm or industry are reduced, they're replaced by jobs in other areas of the economy. This is why we did not see massive unemployment as agriculture mechanized in the early 20th century -- the workforce shifted to other professions. ...
8. The Global Economy In 17 Beautiful Maps
For example:
9. Is Innovation Leading to a New Age of Productivity in the U.S.?
... So-called intelligent machines increasingly communicate among themselves and with people. Mobile devices allow round-the-clock interconnectivity. Computers crunch terabytes of data. Such innovations have convinced some economists that the stage is set for a wave of productivity gains to rival the one spawned by the 10-year Internet boom that began in 1995. "I'm quite optimistic," says Erik Brynjolfsson, a professor at the Massachusetts Institute of Technology's Sloan School of Management. Leaps in productivity would allow faster growth without generating higher inflation. Companies could pay their workers more while still enjoying healthier earnings. Rising tax revenue would make it easier for the U.S. to cut its budget deficit. ...
1. Did living standards improve during the Industrial Revolution?
... So, while the Industrial Revolution ultimately led to big increases in wealth, progress was unsteady. For much of the period, the average person was not reaping the benefits of economic change.
So much for wages. Other measures of standard of living should be considered. ...
This a great piece highlighting the methods economic historians use to evaluate standards of living.
3. Robert Reich on free markets
... In reality, the "free market" is a bunch of rules about (1) what can be owned and traded (the genome? slaves? nuclear materials? babies? votes?); (2) on what terms (equal access to the internet? the right to organize unions? corporate monopolies? the length of patent protections? ); (3) under what conditions (poisonous drugs? unsafe foods? deceptive Ponzi schemes? uninsured derivatives? dangerous workplaces?) (4) what's private and what's public (police? roads? clean air and clean water? healthcare? good schools? parks and playgrounds?); (5) how to pay for what (taxes, user fees, individual pricing?). And so on.
These rules don't exist in nature; they are human creations. Governments don't "intrude" on free markets; governments organize and maintain them. Markets aren't "free" of rules; the rules define them....
All true, but the rules were not arbitrarily written yesterday. Centuries of trial and error are reflected in the rules. That doesn't make them all just or above modification, but neither are they a game thrown together at a whim. To claim there are no free markets because government frames elements of exchange is like saying there is no such thing as free speech because government frames elements of public dialog.
4. American Farmers Say They Feed The World, But Do They?
... So I called , an economist at Cornell University who studies international agriculture and poverty.
They're both right," he says, chuckling. "Sometimes the opposite of a truth isn't a falsehood, but another truth, right?"
It's true, he says, that bigger harvests in the U.S. tend to make food more affordable around the world, and "lower food prices are a good thing for poor people." ...
... But Mellon is right, too, Barrett says. The big crops that American farmers send abroad don't provide the vitamins and minerals that billions of people need most. So if the U.S. exports lots of corn, driving down the cost of cornmeal, "it induces poor families to buy lots of cornmeal, and to buy less in the way of leafy green vegetables, or milk," that have the key nutrients. In this case, you're feeding the world, but not solving the nutrition problems. ...
5. Why the U.S. Needs to Fall Out of Love With Homeownership
... Less developed countries have consistently higher levels of homeownership, while more advanced nations combine higher levels of economic development with substantially lower levels of homeownership. (The correlation between the two is -.40 overall and it rises to -.58 when she removed outliers Singapore, Norway, Luxembourg and Switzerland). American political rhetoric tends to equate rising homeownership rates with strong economic development. Instead, the opposite is true. The rate of homeownership declines as nations get wealthier.
One reason for this may be because people in less developed nations have fewer options of where to put their money. In agrarian economies, land ownership is the basic source and measure of wealth. In more advanced capitalist economies, people have many more investment options. Many of the places with the highest rates of homeownership are in former Communist nations of Eastern Europe. ...
... And numerous studies have found that excessive homeownership significantly distorts the economy, diverting investment away from much more needed areas like technology and knowledge.
Homeownership continues to make sense for many Americans. But for those whose income is limited or who are still building their careers, a house can be an anchor than limits their ability to move to where jobs are. ...
6. Household Incomes Remain Flat Despite Improving Economy
7. Brazil's New Middle Class: A Better Life, Not An Easy One
Tens of millions of Brazilians have risen out of poverty over the past decade in one of the world's great economic success stories. The reasons are many: strong overall economic growth, fueled by exports. A rise in the minimum wage. A more educated workforce. And big government spending programs, including direct payments to extremely poor families.
But becoming middle class in Brazil means a better life, not an easy one. The new, lowest rung of the middle class is what in the U.S. would be called the working poor, with monthly incomes of between $500 and $2,000.
Yet this group is driving consumer spending in Brazil as they cobble together enough money to buy a television, a cell phone or pay for their children to go to a private school. ...
Finances Online: How iPhone Is Made: A Surprising Report on How Much of Apple’s Top Product is US-manufactured
... In this infographic we trace the iPhone supply and manufacturing chain. We’re providing snippets of information on both of the existing flagship model plus early breaking rumors for the next-gen iPhones. Did you know, for example, that 90% of all the rare-earth minerals used on an iPhone 5’s circuitry, screen, speakers, and glass cover are mined in China and Inner Mongolia? And did you know that Foxconn might soon be overtaken by Pegatron as Apple’s biggest manufacturing partner in China?
What does the rest of the world contribute to the making of the iPhone? Let’s find out!
These articles caught my eye this week. First, in the Atlantic: Bash Brothers: How Globalization and Technology Teamed Up to Crush Middle-Class Workers
Globalizationandtechnology is often referred to like a monolithic thing. A new study shows they're very separate. Globalization increases joblessness. Computers increase inequality.
The article is reporting on a recent economic study: Untangling Trade and Technology: Evidence from Local Labor Markets
... Here's the bumper sticker version of their conclusion: Globalization increases unemployment; technology increases inequality.
Globalization: The authors found that metros with more exposure to Chinese trade -- mostly concentrated in the swoosh of states extending from Indiana down to the Gulf of Mexico and up through North Carolina -- saw significant job losses, both in manufacturing and overall. For every $1,000 increase in imports per worker, the share of people with jobs declined by 0.7 percentage points -- and more for non-college grads. As manufacturing jobs declined, demand for local services would decline, and thus job losses could extend into areas like retail and hotels.
Technology: The computerization of certain tasks hasn't reduced employment, the authors find. But it has reduced the availability of decent-paying, routine-heavy jobs. Middle-class jobs, like clerks and sales people and administration support, have disappeared as computers gradually learned to perform their routines more efficiently. But as those jobs disappeared, cities saw an increase in both high-skill work and lower-paid service sector work, leading to little overall change in employment. ...
CNBC has an article (published at Huff Post) Where The 1 Percent Really Get Their Money:
Much of the debate over taxing the wealthy focuses on taxing giant salaries.
But a new study from the nonpartisan Tax Policy Center found that the real money for the wealthy is made from investments and business income—not compensation. ...
And Mark Perry recaps this article in the Journal of Economic Perspectives: Stunning new study dismantles Obama's "1% vs. 99%" inequality argument.
The JEP article is here: It's the Market: The Broad-Based Rise in the Return to Top Talent
Perry summarizes:
In their paper, Kaplan and Rauh conclude "it's the market" rather than some class-wafaresque malfeasance at play. Here's why:
1.The increase in pay at the highest income levels is broad-based: Public company executives, private company executives, hedge fund and private equity investors, Wall Street bankers, lawyers, and pro athletes have all experienced big jumps in pay over the past few decades. ...
2. Typical measures of high-end income inequality are incomplete. Inequality alarmists typically point to data from Thomas Piketty and Emmanel Saez which show the share of taxable income accruing to the top 1% up markedly since 1980 and at levels not seen since the Roaring '20s. Yet once you add back transfer and taxes, as the Congressional Budget Office does in its analysis, you find that government policy — including the tax code — has already been restraining the rise inequality. Kaplan and Rauh: "In the most recent data from 2009, the aftertax, after-transfer income share of the top 1 percent was around the same level as in 1987–1988, 1996, and 2001."
3. The superrich are getting that way through effort and education — particularly in industries where tech and globalization play a big role — rather than through inheritance: ...
It has long been my suspicion that a central player in the rise of inequality is the ongoing race between technological innovation and human capital development. During times of rapid increase in productivity through technological changes, owners of the technology race ahead. Worker education and the formation of human capital are slower to adapt. But technology can only go so far before it must have plentiful workers who have adapted. As this gain from technology runs its course, the demand for new workers increases labor begins to race ahead. I'm no expert on these matters, but it seems that something like that is happening today. It isn't just the U.S. that experiences this, but the whole industrialized world. Something more systemic appears to be afoot.
I skipped Saturday Links last week due to the holiday weekend. I'm catching up this week.
"... Selke, now 36, is part of a vanguard of young Christians who believe that God uses not only the church and formal ministry but every sphere of society, including business and free markets, to advance his work of shalom. Selke parlayed his experience analyzing companies, creating spreadsheets, and evaluating profitable opportunities for an investment bank into helping social entrepreneurs—people who create organizations in order to benefit society.
In 2010, Selke co-founded Hub Ventures, an accelerator in San Francisco investing in entrepreneurs launching companies that produce a social good. The 12-week program provides up to $20,000 in seed funding, mentorship, workshops, and access to investors in exchange for an average of a 6 percent ownership stake. What separates Selke's program from other business accelerators en vogue in Silicon Valley is the focus on "entrepreneurs building technology solutions for a better world," Selke says. ..."
2. The Global Low Fertility Panic: Just a Phase?
"...Our new book, The Global Spread of Fertility Decline: Population, Fear, and Uncertainty (Yale University Press, 2013) analyzes these trends and the demographic, political and economic consequences and uncertainties as low fertility has become a global phenomenon. Like other facets of globalization, low fertility rates are by no means universal: High fertility persists in sub-Saharan Africa and in parts of the Middle East, but elsewhere low fertility is more the rule than the exception. These underlying trends in childbearing mean that in the near future the rate of population growth both in Europe and Asia are likely to decline. The world is not on a path of unrestrained demographic growth, as some believe. People all over the world have hit the brakes.
Thirty years ago only a small fraction of the world's population lived in the few countries with fertility rates substantially below the "replacement level" - the rate at which the fertility of a hypothetical cohort of women would exactly replace itself in the next generation - normally set at 2.1 children per woman for populations with low mortality conditions. Fast forward to 2013, with roughly 60 percent of the world's population living in countries with such below-replacement fertility rates.
The consequences of these changes are striking. ..."
3. Immigration and Entrepreneurship
According to a Small Business Administration-commissioned report in 2012 by Robert W. Fairlie, an economics professor at the University of California, Santa Cruz, the business ownership rate is higher for immigrants than the native-born, with 10.5 percent of the immigrant work force owning a business compared with 9.3 percent of the native-born work force.
4. Graft Is On The Rise Around The World
5. Job-Stealing Robots Go Global
Asian workers have scored some victories in rising wages, but many are learning something the West has known for some time: Employers will seek out the cheapest labor on offer, and machines are even cheaper than an underpaid human. In the late 20th century, manufacturing jobs shifted from America to China, then from China to Southeast Asia, and now even those are being automated.
For America, at least, this trend shouldn't be so disconcerting. After all, it's developed economies like ours that are designing the robots Nike is now using. Low-wage manufacturing jobs are drying up, but they're being replaced by jobs in building, operating, and repairing the tech in question. Increasingly, companies will be likely to "onshore" these jobs to America, when shipping and distribution becomes much easier and cheaper. Manufacturing, it seems, will come full circle.
6. Economist Mark Perry with a provocative claim: Yes, the middle-class has been disappearing, but they haven't fallen into the lower-class, they've risen into the upper-class
7. Co.exist with what they see as 4 Bogus Claims About Why Walmart Can't Pay A Living Wage (I'm not in full agreement but they make they present their side articulately.)
8. Gallup Has Never Seen So Many Americans Sitting Out Of The Stock Market
9. K-State study: Arguments about money best predictor of divorce
"Results revealed it didn't matter how much you made or how much you were worth," Britt said in the university statement. "Arguments about money are the top predictor for divorce because it happens at all levels."
She said couples should seek a financial planner as part of premarital counseling, and talk about finances.
10. How the Dismal Science Got Its Name (It had nothing to do with Thomas Malthus or scarcity ... or even with students who have suffered through Econ 101 classes.)
11. Matt Ridley writes I may follow the crowd, but not because it's a crowd
"... My friend objected that I seemed to follow the herd on matters like the reality of evolution and the safety of genetically modified crops, so why not on climate change? Ah, said I, but I don't. I agree with the majority view on evolution, not because it is a majority view but because I have looked at evidence. It's the data that convince me, not the existence of a consensus. ..."
12. Dan Lewis debunks the myth that the end of the telegraph is here: The Spread of a False Fact
13. PC sales see 'longest decline' in history
Global personal computer (PC) sales have fallen for the fifth quarter in a row, making it the "longest duration of decline" in history.
14. Time of 'Incredible Violence': Historian Gives Readers Glimpse of Medieval Life
15. Farming Got Hip In Iran Some 12,000 Years Ago, Ancient Seeds Reveal
Archaeologists digging in the foothills of Iran's Zagros Mountains have discovered the remains of a Stone Age farming community. It turns out that people living there were growing plants like barley, peas and lentils as early as 12,000 years ago.
The findings offer a rare snapshot of a time when humans first started experimenting with farming. They also show that Iran was an important player in the origin of agriculture.
16. LGBT group finds acceptance at evangelical college
"... Fuller's community standards states that "sexual abstinence is required for the unmarried" and marriage is between one man and one woman.
Nevertheless, Fuller's decision not to push back against OneTable is a critical step toward acceptance for gay evangelical students, said Justin Lee, the executive director of the Gay Christian Network, which tracks the burgeoning movement. An increasing number of young people have been coming out on Christian campuses nationwide, whether they are accepted or not, and Fuller's move acknowledges that and provides a touchstone for students who would otherwise keep their sexuality a secret, he said. ..."
17. New generation activists build bridges
A traditional organizing approach makes opponents into 'enemies,' but a new crop of union and other activists is using love and empathy to create alliances and new possibilities.
Some weeks the pickin's are thin. Not this week.
1. Asians are now the largest immigrant group in Southern California: New Suburban Dream Born of Asia and Southern California
2. Surge in unwed mothers: Deep in the stats, it's not what you think
According to the US Centers for Disease Control, 42 percent of children will have lived with cohabitating parents by the time they are 12 years old, almost twice as many who will have divorced parents. And this particular sort of family structure is on the rise, a number of studies show.
3. In a sharp trend reversal, highway fatalities rise
"The news, while disheartening, is not surprising," said Barbara Harsha, executive director of the Governors Highway Safety Association. "With the improving economy and historically low levels of motor vehicle deaths in recent years, we expected deaths to increase. Highway deaths have been declining significantly in recent years."
4. We live in a house that is 105 years old. IMO, most houses built after 1940 are boring. How Americans' Taste in Houses Has Evolved Over the Last Century
5. Are we purging the poorest?
In a new book, MIT urbanist Lawrence Vale examines the downsizing of public housing.
6. Eric Schmidt and Jared Cohen have been popping up everywhere promoting their new book, The New Digital Age: Reshaping the Future of People, Nations and Business. Here is a PBS interview:
Watch Google's Schmidt, Cohen Describe a 'New Digital Age' on PBS. See more from PBS NewsHour.
7. Love this story: Alleviating Poverty with a Washing Machine Powered by Your Feet
The GiraDora uses the principles of a salad spinner to make cleaning clothes less back-breaking and time-consuming work for millions of people in poverty.
8. Amen to this article. Good charities spend more on admin but it is not money wasted
The popular idea that charities fritter money on unnecessary admin has been proven wrong. You must spend to be effective.
9. Why US firms are turning to Mexico, leaving China behind
... Mexico has more international trade deals than any other country, and exports as many goods as the rest of Latin America combined.
There has always been an electronics manufacturing hub in Tijuana, but Chinese competition damaged its business a decade ago.
Now rising wage costs in Asia and a higher exchange rate are prompting many companies targeting the US market to take another look at Mexico. ...
...The new Mexican President Enrique Pena Nieto wants to put a new spin on the country with the image of a booming economy and as a good place to do business.
Security and the drugs problem still dominate talks between the US and Mexico, but its southern neighbour's increasing importance in the global economy is changing the relationship. ...
10. The Manufacturing Cost Components For A Bunch Of Different Things
11. Five Innovative Technologies that Bring Energy to the Developing World
12. No-Wash Shirt Doesn't Stink After 100 Days
13. Craig Stanford, 'Planet Without Apes' Author, Says Eco-Tourism Could Save The Primates
A slice of the money that tourists pay can run $500 an hour at some of the sites in East Africa and goes to build hospitals and hire teachers." Although it's not philosophically or altruistically driven, the bottom line is the animals are more valuable alive than dead, since there's an incentive to protect them.
14. Approaching Nutrition From An Investor's Mindset
How does one succeed in nutrition when nobody seems to agree on anything? How can one get the benefits that arrive in the early stages of a diet without staying too long and compromising their health? What has worked well for me is thinking about nutrition like an investor thinks about investment opportunities.
15. The Lies You've Been Told About the Origin of the QWERTY Keyboard.
The QWERTY configuration for typewriters can be traced, actually, to the telegraph.
16. Money Buys Happiness and You Can Never Have Too Much, New Research Says
Here again we have to revisit the differences between happiness, joy, meaning, and satisfaction.
Watch Baseball and Religion on PBS. See more from Religion & Ethics NewsWeekly.
18. Why Older Minds Make Better Decisions
Recent research has already challenged what we thought we knew about the capability of the brain. What has become clear, says Dr. Gregory Samanez-Larkin of Vanderbilt University, one of the network's co-directors, is that despite a decline in some types of cognitive function, "older people often make better decisions than younger people."
19. Moon Landing Faked!!!—Why People Believe in Conspiracy Theories
New psychological research helps explain why some see intricate government conspiracies behind events like 9/11 or the Boston bombing.
20. Scot McKnight answers the question So What's an Anabaptist?
21. Beneath the stereotypes, a stressful life for preachers' kids
22. When and Where Is It Okay to Cry?
23. 10 Reasons Why Humor Is A Key To Success At Work
24. Scientists May Be On Brink Of Major Discovery In Hunt For HIV Cure
Danish scientists are expecting results that will show that "finding a mass-distributable and affordable cure to HIV is possible."
They are conducting clinical trials to test a "novel strategy" in which the HIV virus is stripped from human DNA and destroyed permanently by the immune system.
Quartz: The world’s middle class will number 5 billion by 2030
Millions of newly affluent people in emerging economies are reshaping and resizing the global middle class. The world’s middle class will swell from 2 billion to almost 5 billion by 2030, with most of that growth coming from developing countries, according to the Organisation for Economic Co-operation and Development. The world population in 2030 is expected to be about 8 billion.
The OECD defines “middle class” as making $10 to $100 a day, adjusted for the purchasing power of each currency. Today, people in developing countries make up almost 30% of the world’s consumer spending, up from 18% a decade ago as they become middle class. This change, what the US National Intelligence Council called a ”tectonic shift,” is one the most important trends for the next several decades. ...
Atlantic: Showing the American Manufacturing Worker Is Suddenly an Incredible Bargain
This month's Atlantic magazine predicts that we are on the verge of a U.S.-based manufacturing renaissance, as companies see the advantages to making more goods at home, such as more control over the final product, lower energy costs from moving goods across an ocean, and a falling "wage gap."
Simply put, U.S. factory workers are a much better deal than they were just ten years ago. ...
