Fiesta or Fiasco?

The Economist has a special on the Spanish economy... highly recommended! It also has an interview with the Prime Minister, Jose Zapatero. It doesn't exactly make me optimistic about the quality of economic decision-making in the pipeline.

Start the Academic Year with Jeff Williamson

Jeff Williamson, the only-just-retired Laird Bell Professor of Economics at Harvard and one of the pioneers of quantitative economic history, gave the speech opening the academic year at UPF. This is meant to introduce undergrads to what economics is about, and it would be hard to think of a better speaker for this - beautifully clear, ambitious without being technically arcane, and in pursuit of big answers to big questions. Jeff talked about divergence in the 19th century. Terms of trade shocks should have favoured the then-developing world, but it didn't help - why? Coming hot on the heels of one of the biggest commodity price booms in the last few decades, it was a highly topical paper to deliver. Jeff argues that terms of trade moving the right way was not enough - volatility mattered, and it undermined the chances of the periphery to develop. As we watch the current meltdown following the recent spike in commodity prices, I hope this has less predictive power than economic history normally does.

Slavery and Trust

We just had Nathan Nunn (Harvard) visiting UPF and CREI for a week. Nathan is an outstanding example of a new breed of economic historians, using data from the more distant past to shed light on present-day problems. He has written quite a bit on the effects on slavery. As a graduate studen (so Nathan told the story to our doctoral students), he noticed that many growth regressions used an Africa dummy. He got curious, and has done much to link the importance of that dummy with the history of slavery. In his latest work, he uses data from Afrobarometer - a survey - to show that in areas where many slaves were caught for shipment, the level of interpersonal trust today is still remarkably low. Even close family members are not very much trusted. It is easy to see how this will undermine economic efficiency, limiting market transactions etc. What I would like to see is how the distributions differ between areas in which many slaves were caught vs. the others -- if it is true that trusting parents produce trusting offspring, then the difference in means that Nunn finds should be driven by the most trusting part of the population "missing" in the areas most affected by the slave trade...

Student blog

Our students are an energetic bunch, and apparently liked what we did with the ITFD blog. Here is the link to their blog (which they run without guidance or control from faculty or administrators). I think it gives a good idea of what student life is like around here...