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October 13, 2008

Blogger wins Nobel prize in economics

I hear he also writes for a newspaper…

(Congratulations to Mr. Krugman! I guess telling the truth and being right occasionally pays off.)

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September 29, 2008

Fiscal physics

From Greg Mankiw‘s blog:

From a freshman physics quiz given at Princeton a few days ago:

Problem 1. A famous thought experiment in economics involves dealing with a financial crisis by dropping money from a helicopter.

Ben Bernanke, Federal Reserve Chairman and former Princeton Economics Professor, decides to try this out over his old hometown. With his helicopter flying 1.0×10^1 m above the center of Fine Tower and in the direction of Nassau Hall, Ben gently releases a briefcase containing $1 million. Using the information that (i) Fine Tower is 6.0 × 10^1 m high, (ii) Nassau Hall is 1.5 × 10^1 m high and (iii) the centers of the two buildings are 3.0 × 10^2 m apart, and ignoring air resistance as you normally would:

a. [2 pts] How fast should Ben’s helicopter fly so that the briefcase lands in the center of the roof of Nassau Hall?

b. [1 pt] How long is the briefcase in the air?

c. [1 pt] How fast is the briefcase moving when it hits the roof of Nassau Hall?

d. [1 pt] How much faster would the financial relief have reached Nassau Hall if the briefcase had contained $2 million instead?

Thanks to Princeton Professor Shivaji Sondhi for sending this along.

Greg is an economics professor at Harvard.

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September 21, 2008

The Bank Surge

I don’t understand economics or the current crisis. I thus don’t trust my own judgments about who to believe. But Paul Krugman’s concerns and analysis strike a chord. So do Eric Hovde‘s in the Washington Post.

Since I lack the education and background to understand the crisis and its context, I find myself thrown into rudderless thinking, where I find myself swayed by people who I already tend to agree with (= Krugman), who are able to pain a coherent picture, and whose broad premises seem in line with mine. In short, I feel pretty helpless not just about the crisis about even how to understand the crisis.

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September 5, 2008

[AE] Yochai Benkler

Yochai says he wants to leave the question: Can free culture survive systematization? [Trying to keep up with Yochai. Failing. Posting without proofreading or spell checking. Caveat lector.]

In 1835, it cost $10K (modern dollars) to start a daily newspaper. Now it costs millions. The startup cost causes a bifurcation between passive audiences and professional, commercial producers. The industrial structure of mass media characterizes the modern age. But, consider that [email protected] dwarfs the computing power of the supercomputers created in industrial ways. This is a radical decentralization of inputs and processes: material, processing, storage, communication, creativity, wisdom. For the first time, the most important inputs are broadly distributed in the population.

This takes social action that’s always been there, and moves it from being important socially and peripheral to the economy, to being at the core.

In Wikipedia vs. Britannica, the core issue isn’t price. It’s authority. The most important part of the Nature comparative study of the two was the editorial that urged scientists to update Wikipedia, sharing traditional authority with the new medium.

Yochai shows a 2×2: centralize or decentraliced vs market-based and non-market. Now we have a four-way interaction among all the old players, from traditional to social-sharing non-profits.

This engages distributed sensing of opportunities for action, solutions, experimentatino, adaptation. You get new and exciting possibilities. The increasing complexity and speed of change has been pushing businesses to go beyond the old technique of hiring what they need. “We can learn faster by loosening the structure of who gets to be effectively active in the world.”

But Yochai wants to focus on participatory culture and democracy. “Critical to the success and power of social production … is the decentralization of practical capacity to act…but also locating authority to act where the capacity to act resides.” This is where commons-based resources are important: We can act on them without permission. This is also where peer production systems (people cooperating without firms) matter because it allows people to work together without permission. “Ownership no longer equals or entails authority.” We get a more diverse , more transparent, and maybe a more critical self-reflective culture (although here he leaves a question mark).

Yochai shows a kickass video of a guy in a suit figuring out how to play the drums, followed by another guy in a split screen plahing piano. By someone named Lasse something? If you have the url, could you post it in the comments? He tells the story of the Daily Prophet, a 14 yr old who poste Harry Potter stories, and seven years later has started a distributed projeto t scan in fantasy illustrations from old books. Also, the site Learning To Love You More’s project of collecting photos of bed underneaths. Also, Also, And And distributed reportage (“Bomb bomb bomb, Iran”). “Yes We Can.”

YouTube lets individuals create and post. Revver and Metacafe tries to find ways to get artists paid. But, “once they introduced money, they introduced distrust.” Kaltura enables editing and has worked on engendering trust via open sourcing. Everything will be kept free. It binds its organization to a set of institutions that are free and open.

Politics isn’t just about politicians. It’s also about meaning. What things mean and how they mean.

So, human creativity decentralized can create a more democratic system, but it threatens the industrial model. For the past decade there’s been a rough stalemate over IP. But the most important actions have been social/cultural: Sharing practices. Increasingly institutionalized, e.g., Free Software Foundation, Creative Commons.

We’re seeing new models of market-cultural society relations: Credible commitment mechanisms, self-binding licenses, transparency, participation, styles of leadership. Authenticity and conversation become central. New ways to build trust, fairness, reciprocity.

He ends by taking Jonathan Coulton as an example. [What about Brad Sucks? :) ] He shows the Code Monkey videos.

“This is invoking a fundamentally different normative framework than ‘This is mine and you can’t have it.'”

The basic question: Can we create new social cultural spaces in the overlap of market and social relations, sustainable and not based on control and authority but on social and cooperative models? [Tags: ]

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July 6, 2008

Short reality!

Bloomberg reports that Mattel’s market cap, “helped by rising sales of Matchbox and Hot Wheels toy cars,” is now larger than GM’s. [Tags: ]


June 13, 2008

Oil prices: The spreadsheet

Here’s a table of oil prices since 1984, day by day. You can also download it as a spreadsheet, and then you can graph it, in order to get a visual display of quantitative information that confirms that gas prices have pretty much gone up overall.

Alternatively, you could take your car in for a fill-up.

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