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Archive for January, 2016

Always The Optimist

January 19, 2016 Leave a comment

Actually, I don’t see myself as a China optimist. I just think the most realistic view is a positive one.

I have several questions for the pessimists. When someone says:

But we do know that the vast global network of mines, roads, agricultural development, and financial speculation built on the assumption that the old Chinese economy would grow at eight percent forever is running on empty.

I have to ask: was there really a lot of money invested on the assumption of 8% growth forever? Sure, some investing is irrational and can create over-capacity. But I doubt that any really big investors used “8% forever” as their basis for decision making.

Is is possible that, having seen the Chinese economy grow quickly for a far longer period of time than expected, investors were acting rationally? That they risked over-shooting by a few percentage points rather than under-shooting because it made sense in an economy that consistently grew faster for longer than had ever happened in recent history?

And does it really matter? So what if the Chinese economy doesn’t grow at eight percent a year? If it keeps growing at all, but on an ever-increasing base, won’t a lot of that demand materialize sooner or later?

But we have not yet hit bottom. The new reality of a much slower growth in China’s demand for basic manufacturing inputs is still young and its impact is only now beginning to be felt.

But…what if it is a good thing that there is “slower growth in China’s demand for basic manufacturing inputs?” What if that just means that, as China’s productivity is growing and its economy is maturing, it’s moving out of basic manufacturing?

That would mean China will demand many more goods produced from “basic manufacturing” relative to the goods it’s producing in basic manufacturing. That sounds like lots of imports to me. Those imports will have to be produced somewhere–probably they will be spread over a number of smaller economies that are able to gain comparative advantage in the manufacture of basic goods.

Really, which is more likely: that global demand for “basic manufacturing inputs” will move from China to…nowhere? Or from China to Bangladesh, Vietnam, India, Ethiopia, Tanzania?

Will that really be a bad thing?

For anyone?

 

 

 

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Categories: China, International Trade

Domestic Market Size and Export Specialization

January 19, 2016 Leave a comment

A puzzle:

Exports have been growing, and China’s global market share has been rising until very recently. So China has generally been steadily becoming a more successful exporter. But as this has happened it has not shown much sign of becoming more specialized in particular types of products, which is usually one of the things that happens in countries that are successful exporters.

A possible explanation:

But perhaps, as Carsten suggests, the issue is more fundamental, and one we have not really encountered before: China’s export industries might already large enough, relative to total world demand, that even a very successful export performance will not show up as much specialization. This is one to ponder further.

(I really want to teach International Economics again.)

Categories: China, International Trade

Great Video on Growth Rates

January 18, 2016 Leave a comment

How do I work this video into a class?

The subject is just too important to ignore. If you want more health care, more nutrition, more education and more resources for protecting the environment, it’s crazy not to discuss the central role of economic growth:

 

Categories: Videos

Predict The Unintended Consequences, Part…

January 17, 2016 Leave a comment

Bernie Sanders wants to impose price ceilings:

Speaking just blocks from Wall Street, Sanders vowed…an array of new protections for consumers. Among other steps, the Vermont senator called for capping interest rates on credit cards at 15 percent and capping ATM fees at $2.

I think I know who he’s trying to help. But hopefully my freshmen students can use what they’ve learned and predict some unintended consequences of these price ceilings.

Categories: Price Controls

Another Good Thing About On-Line Education

January 16, 2016 Leave a comment

As much as I like teaching students in person, I am also a big fan of online education, for many reasons.

Here’s another one: it reduces grade discrimination based on attractiveness.

Professors differ on how much their grading should be based on tests, written assignments, labs, class participation and other factors.

But students’ looks? Most faculty members would deny that physical appearance is a legitimate criterion in grading. But a study presented Monday at the annual meeting of the American Economic Association finds that — among similarly qualified female students — those who are physically attractive earn better grades than others. For male students, there is no significant relationship between attractiveness and grades. And the results hold true whether the faculty member is a man or a woman.

But not for online education:

The researchers then took advantage of Metro State’s significant online offerings, which appeal to many students who also take courses in person. Comparing similar groups of students, the study found that the grade punishment for unattractive women disappears in online education….The online success of the less attractive students suggests, the paper says, that their lower grades in in-person classes can’t be attributed to some factor that might make them legitimately earn lower grades.

 

Categories: Education, Microeconomics

Final Microeconomics Course Grades (Preliminary)

January 15, 2016 Leave a comment

It’s late, so I need to double-check these, but it’s looking like this:

Student: 2103, Total Points: 640, Grade: A

Student: 4416, Total Points: 590, Grade: A

Student: 4845, Total Points: 575, Grade: A

Student: 8816, Total Points: 564, Grade: A

Student: 7114, Total Points: 555, Grade: A

Student: 5812, Total Points: 553, Grade: A

Student: 2744, Total Points: 551, Grade: A

Student: 8697, Total Points: 546, Grade: A

Student: 7190, Total Points: 539, Grade: A

 

Student: 7088, Total Points: 523, Grade: B

Student: 9860, Total Points: 520, Grade: B

Student: 4762, Total Points: 483, Grade: B

Student: 9750, Total Points: 483, Grade: B

Student: 2516, Total Points: 482, Grade: B

Student: 1763, Total Points: 481, Grade: B

Student: 8557, Total Points: 478, Grade: B

Student: 2214, Total Points: 467, Grade: B

Student: 8262, Total Points: 463, Grade: B

Student: 2662, Total Points: 462, Grade: B

Student: 2522, Total Points: 454, Grade: B

Student: 3891, Total Points: 453, Grade: B

Student: 2379, Total Points: 442, Grade: B

 

Student: 7690, Total Points: 424, Grade: C

Student: 6195, Total Points: 416, Grade: C

Student: 9041, Total Points: 406, Grade: C

Student: 5280, Total Points: 398, Grade: C

Student: 2924, Total Points: 391, Grade: C

Student: 5432, Total Points: 379, Grade: C

Student: 8755, Total Points: 379, Grade: C

Student: 6555, Total Points: 364, Grade: C (median student, tie)

Student: 9996, Total Points: 364, Grade: C (median student, tie)

Student: 6157, Total Points: 362, Grade: C

Student: 3227, Total Points: 361, Grade: C

Student: 6335, Total Points: 337, Grade: C

Student: 6320, Total Points: 329, Grade: C

Student: 1752, Total Points: 314, Grade: C

Student: 2872, Total Points: 299, Grade: C

Student: 2793, Total Points: 299, Grade: C

Student: 2376, Total Points: 286, Grade: C

Student: 4577, Total Points: 274, Grade: C

Student: 1828, Total Points: 274, Grade: C

Student: 6369, Total Points: 273, Grade: C

Student: 3074, Total Points: 271, Grade: C

Student: 6710, Total Points: 259, Grade: C

Student: 6170, Total Points: 255, Grade: C

 

Student: 2338, Total Points: 240, Grade: D

Student: 3608, Total Points: 233, Grade: D

Student: 7829, Total Points: 230, Grade: D

Student: 8861, Total Points: 230, Grade: D

Student: 1234, Total Points: 228, Grade: D

Student: 6332, Total Points: 210, Grade: D

Student: 7090, Total Points: 195, Grade: D

Student: 7418, Total Points: 187, Grade: D

Student: 1417, Total Points: 171, Grade: D

Student: 2812, Total Points: 156, Grade: D

Student: 6934, Total Points: 156, Grade: D

Student: 5695, Total Points: 149, Grade: D

 

Student: 7145, Total Points: 136, Grade: F

Student: 9501, Total Points: 128, Grade: F

Student: 6023, Total Points: 104, Grade: F

Categories: Grades

Results of the Microeconomics Exam

January 14, 2016 Leave a comment

Below, the number after “points” is what I will add to your final class score, posted here under Grades Going Into Final Exam. The highest possible number of points you could get from this final is 135.

Student: 2103, Correct Answers: 256, Points Added: 128

Student: 2744, Correct Answers: 248, Points Added: 124

Student: 8816, Correct Answers: 242, Points Added: 121

Student: 4416, Correct Answers: 238, Points Added: 119

Student: 4845, Correct Answers: 235, Points Added: 117.5

Student: 7088, Correct Answers: 230, Points Added: 115

Student: 5812, Correct Answers: 227, Points Added: 113.5

Student: 7114, Correct Answers: 225, Points Added: 112.5

Student: 2522, Correct Answers: 221, Points Added: 110.5

Student: 8697, Correct Answers: 220, Points Added: 110

Student: 7190, Correct Answers: 219, Points Added: 109.5

Student: 1763, Correct Answers: 214, Points Added: 107

Student: 2214, Correct Answers: 212, Points Added: 106

Student: 5280, Correct Answers: 211, Points Added: 105.5

Student: 9860, Correct Answers: 209, Points Added: 104.5

Student: 2516, Correct Answers: 209, Points Added: 104.5

Student: 2662, Correct Answers: 198, Points Added: 99

Student: 8262, Correct Answers: 197, Points Added: 98.5

Student: 7690, Correct Answers: 195, Points Added: 97.5

Student: 2379, Correct Answers: 194, Points Added: 97

Student: 4762, Correct Answers: 194, Points Added: 97

Student: 9041, Correct Answers: 193, Points Added: 96.5

Student: 6195, Correct Answers: 186, Points Added: 93

Student: 9750, Correct Answers: 184, Points Added: 92

Student: 8557, Correct Answers: 173, Points Added: 86.5

Student: 5432, Correct Answers: 171, Points Added: 85.5

Student: 2924, Correct Answers: 155, Points Added: 77.5

Student: 6157, Correct Answers: 154, Points Added: 77

Student: 9996, Correct Answers: 153, Points Added: 76.5

Student: 2872, Correct Answers: 152, Points Added: 76

Student: 8755, Correct Answers: 152, Points Added: 76

Student: 6320, Correct Answers: 148, Points Added: 74

Student: 3227, Correct Answers: 146, Points Added: 73

Student: 2793, Correct Answers: 146, Points Added: 73

Student: 6555, Correct Answers: 141, Points Added: 70.5

Student: 1752, Correct Answers: 135, Points Added: 67.5

Student: 3891, Correct Answers: 134, Points Added: 67

Student: 6335, Correct Answers: 131, Points Added: 65.5

Student: 6710, Correct Answers: 120, Points Added: 60

Student: 1828, Correct Answers: 119, Points Added: 59.5

Student: 8861, Correct Answers: 118, Points Added: 59

Student: 1234, Correct Answers: 118, Points Added: 59

Student: 4577, Correct Answers: 118, Points Added: 59

Student: 3074, Correct Answers: 113, Points Added: 56.5

Student: 6332, Correct Answers: 112, Points Added: 56

Student: 2376, Correct Answers: 110, Points Added: 55

Student: 7829, Correct Answers: 109, Points Added: 54.5

Student: 6934, Correct Answers: 108, Points Added: 54

Student: 6369, Correct Answers: 104, Points Added: 52

Student: 6170, Correct Answers: 100, Points Added: 50

Student: 7418, Correct Answers: 82, Points Added: 41

Student: 7090, Correct Answers: 75, Points Added: 37.5

Student: 2338, Correct Answers: 69, Points Added: 34.5

Student: 1417, Correct Answers: 69, Points Added: 34.5

Student: 3608, Correct Answers: 67, Points Added: 33.5

Student: 5695, Correct Answers: 67, Points Added: 33.5

Student: 7145, Correct Answers: 66, Points Added: 33

Student: 6023, Correct Answers: 61, Points Added: 30.5

Student: 9501, Correct Answers: 52, Points Added: 26

Student: 2812, Correct Answers: 37, Points Added: 18.5

Categories: Grades