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"One of the presentations was by Ole Peters, from the Department of Mathematics at the Imperial College of London. His presentation compared time series analysis with ensemble analysis. Time series analysis takes one realization of a process and runs it over a very long time period and then looks at the distribution over the course of that run, whereas ensemble analysis creates many copies of the process and runs these over a shorter period, and then looks at the distribution of those results. Time series analysis is what you see over many years in one universe, ensemble analysis is what you see when you take many universes and integrate across them to look at the distributional properties.
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"There it is. Job creators hate future taxes, and unemployment insurance has left our workforce weak, so don’t expect unemployment to come down anytime soon.
For all the fancy math, this logic is very similar to Fisher. ”Now suppose that, for the reasons just mentioned, p fell by 10 percent in the past three years and z increased by 0.05 during this period” is about as close to a “gut” feeling and “gut” reasoning as you can get. This appears to be how one of the most powerful people in the world for determining the future of the United States’ economy is determining his dissent from Bernanke’s position."
"Our results show that the marginal effect of financial development on output growth becomes negative when credit to the private sector surpasses 110% of GDP. This result is surprisingly consistent across different types of estimators (simple regressions and semi-parametric estimations) and data (country-level and industry-level). The threshold at which we find that financial development starts having a negative effect on growth is similar to the threshold at which Easterly et al. 2000 find that financial development starts increasing volatility."
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Our results show that the marginal effect of financial development on output growth becomes negative when credit to the private sector surpasses 110% of GDP. This result is surprisingly consistent across different types of estimators (simple regressions and semi-parametric estimations) and data (country-level and industry-level). The threshold at which we find that financial development starts having a negative effect on growth is similar to the threshold at which Easterly et al. 2000 find that financial development starts increasing volatility. This finding is consistent with the literature on the relationship between volatility and growth (Ramey and Ramey 1995) and that on the persistence of negative output shocks (Cerra and Saxena 2008).
"The American Human Development Project provides easy-to-use yet methodologically sound tools for understanding the distribution of well-being and opportunity in America and stimulating fact-based dialogue about issues we all care about: health, education, and living standards."
"In short, what ails the U.S. economy is primarily a structural problem, not a cyclical one that can be effectively dealt with through the magic of short-term Keynesian stimulus. Unless we find a way to dramatically increase the size and scope of the tradable sector, Spence says, we're in for an extended period of slow job growth and rising inequality. And make no mistake: at the heart of this problem is globalization."
"Essentially, economic policy has not supported good jobs over the last 30 years or so. Rather, the focus has been on policies that were thought to make consumers better off through lower prices: deregulation of industries, privatization of public services, the weakening of labor standards including the minimum wage, erosion of the social safety net, expanding globalization, and the move toward fewer and weaker unions. These policies have served to erode the bargaining power of most workers, widen wage inequality, and deplete access to good jobs. In the last 10 years even workers with a college degree have failed to see any real wage growth."
"With exports from low-wage countries like China on the rise, the question of what this means for trade and jobs in developed countries is a furious war of words. This column, using firm-level data for France between 1995 and 2005, shows that competition from low-wage markets actually boosts the sales of high-quality goods – but it concedes the benefits are not universal."
"We estimate that between 2005 and 2010, nearly half a billion people escaped extreme hardship, as the total number of the world's poor fell to 878 million people. Never before in history have so many people been lifted out of poverty in such a short period. The U.N. Millennium Development Goals established the target of halving the rate of global poverty between 1990 and 2015; this was probably achieved by 2008, some seven years ahead of schedule. Moreover, using forecasts of per capita consumption growth, we predict that by 2015, fewer than 600 million people will remain poor. At that point, the 1990 poverty rate will have been halved and then halved again.
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" Typically, linear per capita indicators are used to characterize and rank cities. However, these implicitly ignore the fundamental role of nonlinear agglomeration integral to the life history of cities. As such, per capita indicators conflate general nonlinear effects, common to all cities, with local dynamics, specific to each city, failing to provide direct measures of the impact of local events and policy. Agglomeration nonlinearities are explicitly manifested by the superlinear power law scaling of most urban socioeconomic indicators with population size, all with similar exponents (1.15). As a result larger cities are disproportionally the centers of innovation, wealth and crime, all to approximately the same degree. We use these general urban laws to develop new urban metrics that disentangle dynamics at different scales and provide true measures of local urban performance. "
"In an article this month in PLoS ONE, Bettencourt and his team created a way to measure how exceptional cities are by comparing their characteristics with what mathematics would predict for their size. The team then ranked the exceptionality of 300 U.S. cities based on personal incomes, gross metropolitan product (GMP), number of patents and number of violent crimes. "
This is a draft of an incomplete first-year Ph.D. econometrics textbook.
in list: Economic Crisis
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Negative numbers are bigger than positive numbers
The first problem with measuring a first derivative is that negative percentage changes have statistically greater effect than positive percentage changes. Let me give you an example. Say GDP starts at 100 and it drops 20% to 80, if it rises 20%, you get back to 96, not 100. The 20% down move is the equivalent of a 25% up move. So, in a country like Latvia, where GDP is down 20% annualized, you need an even large push to the upside of 25% to get back to even. Net, net, this means recovery has to be either stronger or longer than the recession to get back to the pre-recession level of production. -
Now, if you think about this in the context of what I just presented, it makes it pretty clear that you don’t need to build inventories to get an uptick in GDP growth. All you need to do is purge fewer inventories. Subtracting a less negative number is the same as adding a positive number. And I doubt we will be purging an annualized $136.8 billion in inventories going forward.
on the Index of Coincident Indicators. Current recession worst than every other since WW2, except 1973-5. Employment losses already the worst in post-war period.
in list: Economic Crisis
Note by contrast that the period of gung-ho globalization, which we may date from the early 1990s on, presented no improvement over the preceding post-war arrangements.
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