Very frequently, economic analysis must compare future and present magnitudes. Say that under policy A, the stream of payoffs for today and next year is (10, 10), while under policy B it is (13, 6). The total of payoff is higher under A, but policy B results in higher payoffs sooner. If later payoffs are […]
In this article I summarize the recently published paper by José Alcalde . In this article, the author discusses the current matching mechanism that is used in Spain to assign medical graduates who pass the MIR exam to residency positions. The system works as follows. Students are ranked according to their marks in the MIR […]
Ravallion (2018) questions the thesis that globalization has been a major driving force of inequality. While this is the conclusion of two recently published books (Bourguignon, 2016 and Milanovic, 2016 ), Ravallion argues that their interpretation of the data is not well supported and that is even contradicted by the economic research. Here is a […]
Let me leave aside for a moment our talk about scientists and papers, and bring up a topic that, at first sight, might seem totally unconnected: Ronald Coase’s economic theory about the firm and the allocation of property rights. As in the case of the problem we mentioned in our last entry (why scientists share […]
Conspicuous consumption can be broadly defined as the type of consumption that does not satisfy a direct need or want, but rather, a desire to be regarded as someone that occupies a higher position in a hierarchy. For example, I buy a Picasso not because I particularly like the painting, but because, hanging on a […]
One of the topics of discussion within behavioral economics is the motivation of effort. Although the typical economic model usually assumes monetary incentives, they do not preclude the existence of other factors, like preferences for being first or psychological and economical benefits from reputation. The growing experimental literature on this area will help to determine […]
In the two previous entries (1, 2) of this series I described the different diagnoses that Marina Garcés and Steven Pinker make of humanity’s current predicament, without concealing my sympathies for the latter’s: with up and downs, with unequal division of the benefits, without bringing us a literal paradise, with lots of problems still to […]
In many group decisions unanimity is required to ensure that a reform will be adopted only if it benefits all its members. Multinational organizations may be the best example of this. However, when members have incomplete and private information about the convenience of the reform, a majority rule with veto power performs better in the […]
Are we in the best of the times, as Steven Pinker asserts? Or do we live in a ‘posthumous’ society, to say it with the favourite image of Marina Garcés? As I told in the previous entry, it is not easy to make a direct comparison between the ideas of both authors, because they follow […]
Keep in mind the word Enlightenment , because it’s very likely that it will be one of the most fashionable concepts within the next months. At a global level, Steven Pinker’s new book, Enlightenment now , will probably carry the lead in terms of sellings, comments and criticisms. But by a fortunate coincidence, its publication […]