Archive for May, 2009

Got to run

May 28, 2009

Am in Delhi being trained by my new company. No time to blog. Be back in two weeks.

Link above for The Lark Ascending. Thanks to Sylvia Jacobs for all the great music!


Technological change

May 26, 2009

The old toasters used to work fine.  They had long lives if you treated them well, and they made fine toasts.  There were no solid state components.  We had a red Murphy Ravi toaster that lasted, what, over twelve years?

The new toaster we bought in Bangalore did not even last a year.  And when it blew, and I took it to the repairwalla, he said the electronic components had failed, and the toaster would have to be junked.  Which it was.

Why can’t we have the simpler, better, older model of toaster?

From my notebooks-III

May 26, 2009

Written on 17.5.2002

There was a man who made a pact for his soul with the Devil.”Make me irresistable to all women, and you can have my soul.”  The Devil agreed and promptly turned the man into a baby.


May 24, 2009


Say, for sake of argument, I am an economist and you are a businessman producing widgets.

You employ me to answer the question:  How much do my workers need?  How much should I pay them?

So I approach the problem from a scientific perspective

I first get a guppy in a fish bowl.  I feed it two spoons of fish food everyday.  It lives for ten days, and then dies.  Then I go over to the nearest fish scientist, and ask him: what is the normal lifespan of a guppy?  He has done research on guppies who live free in the pond, where they can eat as much or as little as they want or need or desire, and from the results of his research I discover that guppies live on an average of 40 days (again, for sake of argument.)  I then give my new guppy three spoons of fish food a day, and find that it lives for 43 days.  I make a table like so:

Amount of fish food daily (spoonfuls) : Life span (days)

So now I know what a guppy needs

Then I get a cat.  And I do the same thing, only this time with cat food (guppies).  I end up with another table:

Amount of food (guppies):Life span (months)

Then having found what a cat needs, I can either get a dog, or a human.  Now you ask, what age of human?  I answer, of working age, of course.  So I have one table for 16 year old males, one for 16 year old females, one for 25 year old males, one for 25 year old females, and so on till my table for 60  year old males.  I give them a 200 sq ft house, rice, dal, and vegetables, then I measure how long they live (this data I can get from insurance companies).  I also measure each worker’s output of widgets.  I easily have my answer to how much a worker needs.  And I give him just that, because that is my profit maximizing level of costs.  I try and compress a worker’s consumption bundle, until the level at which widget production begins to suffer.

Thus have I answered your question and I can gratefully take my compensation (fee) for this from you.

<<From each according to his ability to each according to his needs>>

One essay type question

May 23, 2009

I am told labour is cheaper in India than in the US, and cheaper still is Chinese labour.  Why is this so?

From my notebooks-II

May 23, 2009

Arthur C. Clarke’s epigram in Rendevous with Rama:

<<To Sri Lanka, where I climbed the stairway to the Gods.>>

From my notebooks-I

May 23, 2009

Attributed to William Blake:

<<The road of excess leads to the palace of wisdom.>>

Experiencing volatility

May 22, 2009

All disciplines have their proprietary vocabularies (Film making, mathematics, physics, economics, finance are some fields whose lexicon I know and love.)  And the terms of art have their outer and inner alternate meanings.

Three days into my new job, I feel I must report on a phenomenon that I have been experiencing since my college days in NY.  This is the fact of stress and the consequent volatility of the mind space.  Any seemingly trivial contingency seems to spark off an escalation of mind, which is further enhanced by what I can only describe, in the language of optimal control, as positive feedback.  The mind accelerates into levels of feeling (embarrassment, shame, even unto panic) which are far away from equlibrium (that state so loved by economists).

Yet now that I am at home, those states of mind seem farfetched and uncalled for.

Is it only me, or does this happen to everybody?  People higher up in the organization, do they experience even greater volatility, and thus are presumably paid much more in compensation?  Where is the locus of control, or the control sphere in the organization?  How does one model what appears to be a hive mind?

Still more on needs

May 20, 2009

On further reflection, one begins to wonder if the distinction between needs and wants is tenable at all.  It seems to end up with one person passing judgement on all others’ preferences.  This smacks of totalitarianism.

I remember once reading a leading sunday paper writer who reported on a conversation she had with a Very Rich Man.  She asked him, all these cars, yatchs, houses,…why do you buy them?  And this rich man replied: I need them.  And perhaps he does-denied these, he would quite possibly sink into a fatal depression.

What from a middle class perspective seems to be luxury, from another class perspective may seem like a necessity.

Economists traditionally shy away from normative propositions.  Thus they practice what they like to call positive economics, value free economics.  But I wonder if this is at all possible.  The push and pull and shoving over the net product of society (or the world) is the domain of politics, economists say.  Thus reducing economics to a branch of politics.  But Marx taught roughly that the “mode of production constitutes the economic structure of society, the real basis from which a juristic and political superstucture arises.  To it there corresponds a specific form of social consciousness.[…] It is not the consciousness of man that determines his mode of existence, but conversely, his social state that determines his consciousness.”

Have to think more and clearly about the chain of determinations in i) the real world ii) the realm of theory.  (I used to know this stuff, but don’t know it anymore.  A chicken and egg type confusion.  As the sardar perspicaciously put it – jo pehle order kiya, woh hi pehle aya.)

More on needs

May 19, 2009

This is what Keynes has to say about needs in the  essay “Economic Possibilities for our Grandchildren” (Essays in Persuasion (1931), the entirety of the piece is worth reading):

Now it is true that the needs of human beings may seem to be insatiable.  But they fall into two classes-those needs which are absolute in the sense that we feel them whatever the situation of our fellow human beings may be, and those which are relative in the sense that we feel them only if their satisfaction lifts us above, makes us feel superior to, our fellows.  Needs of the second class, those which satisfy the desire for superiority, may indeed be insatiable; for the higher the general level, the higher still are they.  But this is not so true of the absolute needs-a point may soon be reached, much sooner perhaps than we are all of us aware of, when these needs are satisfied in the sense that we prefer to devote our further energies to non-economic purposes.

Now for my conclusion, which you will find, I think, to become more and more startling to the imagination the longer you think about it.

I draw the conclusion that, assuming no important wars and no important increase in population, the economic problem  may be solved, or be at least within sight of solution, within a hundred years.  This means that the economic problem is not-if we look into the future-the permanent problem of the human race.