10 out of 10 for Easterly's "Africa's Poverty Trap"

This is the best short econ article I've read in the last couple of days: "Africa's Poverty Trap", by William Easterly, published in the WSJ on March 23rd (yeah, I'm reading things with a time lag...). Since you need a subscription to read the article directly on the WSJ site, here's a PDF version on Easterly's site. Some representative excerpts:

"There is a sad law I have noticed in my economics career: the poorer the country, the poorer the economic analysis applied to it. "

"There has been progress in many areas over the last 50 years -- ... yet the same poor economics on sale to Ghana in 1957 are still there today. Economists involved in Africa then and now undervalued free markets, instead coming up with one of the worst ideas ever: state direction by the states least able to direct. "

"Despite these reality checks, blockbuster reports over the last two years by the U.N. Millennium Project (led by Jeffrey Sachs), Mr. Sachs again in his book "The End of Poverty," the U.N. Development Program (UNDP), the Tony Blair Commission for Africa, and the U.N. Conference on Trade and Development (Unctad) have all reached what the UNDP called "a consensus on development": Today Africa needs another Big Push. Do they really think nobody is paying attention? "

"Africa's poverty trap is well covered in the media, since it features such economists as Angelina Jolie, Madonna, Bono and Brad Pitt. But even Bill Gates ... expressed indifference to Africa's stagnant GDP, since "you can't eat GDP." Mr. Gates apparently missed the economics class that listed the components of GDP, such as food. "

with a great 'grand finale':

"The free market is no overnight panacea; it is just the gradual engine that ends poverty. African entrepreneurs have shown what they are capable of. They have, for example, launched the world's fastest growing cell phone industry to replace the moribund state landlines. What a tragedy, therefore, that aid agencies have foisted the poorest economics in the world on the poorest people in the world for 50 years. The hopeful sign is that many independent Africans themselves are increasingly learning the economics of how to get rich, rather than of how to stay poor." [my emphasis in bold]

PS1. I wrote a bit about my excellent impression of Easterly's recent book a while ago. I had also read his earlier book and thought it was simply great! If you want to read competent development economics forget about anything else and read Easterly's books and articles.

PS2. I have a deep appreciation (for some of them, superlative!) for artists like Jolie, Pitt, Madonna, Bonno, or for business (and not only) guru's like Gates. I just don't think their competitive advantage is in economic reasoning or rather (not to speculate too much :-)), not always (certainly not when, in a trully amazing 'irrational exuberance', they all believe they can save the world with one- more- big push and thus rally around Jeff Sachs, an economist who's been rather busy lately with increasing his 'popularity' among non-economists, rather than making sure he gets credit among his fellow economists first, they being the only ones who have the expertise to verify his economics advices...).

Econlinks for 05-04-'07

• Greg Mankiw, the most popular Econ teacher in Harvard, having fun on April Fool's Day. A classic one . No wonder he is so popular :-). In any case, part of the secret is: give some attention to your students!
• One older excellent article on entrepreneurship by the most recent Economics Nobel Laureate, Edmund Phelps, in the WSJ Editorial Page. It is entitled "Dynamic Capitalism" and was published on October 10th, last year. Reminds me of a great quote from another Nobel Laureate, in Literature this time (known even better as a statesman, of course), Winston Churchill: "Some regard private enterprise as if it were a predatory tiger to be shot. Others look at it as a cow that they can milk. Only a handful see it for what it really is - the strong horse that pulls the whole cart". Amen!
• Is Freakonomics ruining Economics? An interesting discussion of Alex Tabarrok and Tyler Cowen on MR. I tend to agree with the "Levitt and Heckman" rather than "Levitt vs. Heckman" part but only as long as the freakonomics is simply not wrong (chances are- and the temptation is high- that one extrapolates those results and most often that is not possible) and does not claim to be anything else than... freakonomics. As I mentioned previously on my blog, Heckman, Rubinstein or Rust certainly have different opinions than the guys from George Mason University and much more extreme than mine :-).

Mungiu-Pippidi despre MAE

Nu am mai citit de mult un articol peste medie scris de Alina Mungiu-Pippidi (iertata sa-mi fie constatarea; poate ca sunt singur in aceasta opinie :-)), dar in sfarsit am gasit unul cvasi-excelent. Si chiar despre un subiect fierbinte care a condus (indirect) la implicatii si mai fierbinti: MAE. Titlul ar fi putut fi mai bine ales, dar oricum incheierea compenseaza magistral pentru asta: "In loc sa ne fi intrebat daca era apt dl Cioroianu pentru slujba, mai bine ne intrebam daca slujba asta mai este apta pentru cineva.". De nota 10 observatiile privind "substanta politicii externe" si rolul...inexistent al echipei MAE anterioare in asta (PDF-urile respective chiar lipsesc, go & check it out for yourself :-)) si analiza referitoare la confuzia obiectivelor cu mijloacele (unde as preciza ca nu suntem chiar singuri, avem vecini care au facut si fac in continuare acelasi lucru...desi asta in nici un caz nu ar trebui sa ne consoleze). Bine!

Song of the day: "White Rabbit" by Jefferson Airplane

Intro: without any direct connection a priori (though, thinking again about it, perhaps I was in a psychedelic state to give Marie-George Buffet 5 points...), I recalled the song I propose as today's song following a short discussion in the comments section of my friend Dan's post about the French candidates to presidency (you should do that politiquiz as well: as for myself, I got Sarkozy and Bayrou on the top places with 10 points both- never mind whom I got on the third place :-)- and I trust the French will be smart enough to do likewise in their fast approaching elections...).

But to get to the gist of this post. Today's song is a classic by a band that belonged (to some extent) to the "oldies" category already by the time I was born (notwithstanding that they had two successor bands and thus "continued" far in the 90's...). And that happened quite some time ago :-). Nevertheless, this band (co)pioneered the whole psychedelic rock movement and managed to create some immortal and superb (or, even better: immortally superb) songs. If you haven't yet realized (shame on you! :-)) which band I am talking about, this is the folk-rockers band Jefferson Airplane, of course! Their wikipedia entry is almost exhaustive this time and these guys are probably very well known anyways, hence I don't think there is any scope for me to write more about them here. Instead, let me put some links to clips from YouTube (by now, this should clearly come forth as my favourite place online!) with Jefferson Airplane performing some of their masterpieces. And let me start with my favourite from them and today's song and probably their most famous creation (song written by singer-songwriter Grace Slick): White Rabbit (with a great live performance at Woodstock, 1969!). The wicked lyrics for this song are here- and I leave it to you to figure out what Grace is singing about :-). An equally popular hit was Somebody to Love (yet again from Woodstock '69), written by Grace's brother in law (it was all in the family...) or try this version from Monterey, 1967. In my opinion these two musical gems mentioned above outweigh everything else from Jefferson Airplane, but there are also other very interesting songs from them, such as: Today, Volunteers, Crown of Creation. Listen also to the beautiful instrumental piece they played very late in 1996, Embryonic Journey- with the occasion of their induction in the Rock and Roll Hall of Fame (and this should say a lot: they were inductees in the same year as superlative musical phenomena like Pink Floyd and David Bowie, who are my all time favourites, so there you go, I shared this secred with you- but I'll talk about them with many other occasions...). Enjoy Jefferson Airplane's masterpieces for now!

Econometrics: A few reasons to use Ox over Gauss

...though I am definitely going to try Gauss as well and learn it better than I know it at the moment (and I certainly think one should try many programming languages; each of them could have particular comparative advantages in specific routines etc.). Below I place some excerpts from some very interesting discussions on an ox discussion list that I consult quite frequently. I will leave the names of the authors out since everybody can trace the fragments on the list linked above (more precisely, we are talking about the archive for April, so here) and keep only what I consider the essential excerpts (I will also place links to the full messages at the end of the respective fragments ). They pretty much contain what I would have to say over the subject as well (obviously I am not so experienced as most of the researchers who answer here; as a personal note, I particularly like the references over the power of the BFGS log-likelihood maximization routine- that came clear, inter alia, in part of the research for a paper I co-authored, and of course the easy extension using C/C++, programming language which I learned far before I ever got to learn/do econometrics- ok, so I might be somewhat biased when preferring an object-oriented, modular, econometrics software :-)).

So, we start here, with the question:

"Dear Ox Users, I am a PhD student who tries to choose between Gauss and Ox. I have tried to ask some people which one to choose, I have read some documents to guide myself in chossing between the two, but still could not make myself clear on which one to choose. [...]" Link.

And some answers I particularly liked were:

"I think that trying to find "the best econometric software" is the wrong way to think about statistical/econometric programming nowadays. 15/20 years ago, people used to learn only one or two econometric software ,but I think that the things are very different now. Even if Gauss highly used in finance, both Gauss and Ox are great software, but sometimes Gauss is better and sometimes Ox is better. I simply depends on what you do. [...] If you are new to econometrics programming, I would say that Ox is easier to learn than Gauss, it is very powerfull (especially if you do arfima, markov models and panels) and it's free for universities." Link.

"[...]I think Ox has an excellent syntax based on C (with its extensions the most used programming language, there must be a reason). I think it is easy to read and to learn. Ox, if you want it, is also object oriented, and it is very easy to make reusable code or packages to share with others. There is not so much documentation on Ox as for Gauss for two reasons: 1) Gauss is still more widespread, 2) the official documentation of Ox is Excellent and public (on the web). Graphs in Ox just look better and are very easy to integrate into LaTeX documents. Ox is fast, but also Gauss is pretty quick. Ox may be extended in C. It is easy to make simple GUIs with Ox." Link.

"[...] 1) Gauss got there first, and is American. Hence it has a huge user base, and lots of code written for it. Alas, it is a poorly designed language. It's too unstructured, and it's easy to write incomprehensible spaghetti code. 2) Ox got there second, and is British. It has, inevitably, a more modest user base. It is, however, a beautifully designed language, combining all the power of matrix programming with the logical structure of C. (It is actually a lot simpler to write than C.) If you follow the recommended coding conventions (naming, indenting) then it is easy to write elegant, compact and self-documenting programs. It's got object-orientation and classes if you are into that, but you don't need to be. So - no contest frankly. If you want to learn a new language for your research, you will not regret starting with Ox. Try Gauss later when you are ready for the worst." Link.

"[...]I used Gauss for econometric programming in the past, and I have to say I did not like it. I oftentimes ended up with"incomprehensible spaghetti code". For starters, the language is not case sensitive, which bothers me. Ox is great. Its syntax is similar to C, it's fast, it has an excellent numerical library, and so on. Just try to do some Monte Carlo where you numerically maximize a log-likelihood function using BFGS in Gauss and Ox, and you will notice the difference. Additionally, please note that you can run Gauss code using Ox. Finally, Ox is free (for academic research and teaching), which is a huge plus in places like Brazil, where we don't have access to university wide site licenses. " Link.

PS. It should be said that, to be completely fair, one should also listen to the viewpoints of the people on a Gauss-users list :-). If anybody has such references, I'd be happy to link them here.

The wine of the months for April: I go with the choice of vinul.ro

Excellent choice on vinul.ro (site in Romanian) for the months of April (and not only because I just tasted this excellent wine last week :-)): Missiones de Rengo 'Reserve Carmenère'. The description of the Reserve Carmenère type in English, taken from the very well designed site of the "Viña Misiones de Rengo":

Our Reserve Carmenère is of an intense violet-red colour, with scents of wild flowers and berries. Its mouth-taste is delicate, complete and elegant, with touches of spices, typical of this variety. Enjoy it with barbecued red meats, spiced pasta, game fowl.

My top 10 music videoclips, among the ones I talked about

Since two charming ladies asked me a few days ago which were my favourite music videoclips among the ones I had already talked about on my blog, I see myself without any other choice but to answer :-). So here it is, my current top 10, but, again: only counting videoclips from artists/songs I talked about on my blog so far, either in my "song of the day" and/or in my "music" categories (the next ones will be, of course, at least as good!- so stay tuned :-)). And it also goes without saying that we are talking about original music videoclips, so no live performance footage or ex-post created videos to match a song and the like :-). Let us see how much of an outlier I am :-). The top is dominated by Yann Tiersen videoclips, for a starter...

• Monochrome, music by Yann Tiersen, voice Dominique A.; I talked about the clip here
• Le Quartier, music by Yann Tiersen; I talked about this clip here
• Twist, music by Goldfrapp; I talked abïut the clip here
• Legyen Igy, music by Anima Sound System; I talked about the clip here
• La Boulange, music by Yann Tiersen; I talked about the clip here
• La Donna Cannone, music by Francesco de Gregori; I talked about the clip here
• Eu beu, music by Pavel Stratan; I talked about the clip here
• O Labirinto Parado, music by Madredeus; I talked about the clip here
• I cried for you, music by by Katie Melua; I talked about the clip here
• In the death car, music by Iggy Pop and Goran Bregovic; I talked about the clip here

Almost made my top 10 (random order starting from here): Libertango- the clip with sequences from the movie Tango Lesson, music by Piazzola (featuring Yo Yo Ma), I talked about the clip here; A quai and Rue des Cascades, music by Yann Tiersen, I talked about the clips here and here, respectively; Desaparecido and Clandestino, music by Manu Chao, I talked about both clips here; Number 1 and Strict Machine, music by Goldfrapp, I talked about the clips here; '68 and Revolution, music by Anima Sound System, I talked about the clips here; Zece, music by Florin Chilian, I talked about the clip here; When the Lady Smiles and Quiet Eyes, music by Golden Earring, I talked about the clips here. More: I also thought that the following two videoclips were absolutely great and in perfect harmony with the corresponding music, despite the fact that they were not the original videoclips of the song (I think they should be recognized as such :-)): Dark Waltz- sequences from The Phantom of the Opera movie, music by Hayley Westenra, I talked about it here and respectively (to end with Yann Tiersen, of course!), Comptine d'un autre été - a self-made animation as far as I understand, with music by Yann Tiersen, I talked about this here.

Update, 4th of April: After Edina draw my attention to a huge flaw of mine (see comments section) :-), I apologize and add the videoclip and details here. It is not in my top 10, but could have made it :-). And we are actually talking about two videoclips of the Magyarorszag song. I have talked about both of them here. The original videoclip is here, music by Olah Ibolya; the one I like better (but not the intro to it!) is the "collective one" from here, with many Hungarian artists and Olah Ibolya being the last to sing.

Quote for the week 1st to 7th of April '07

I've decided something: Commercial things really do stink. As soon as it becomes commercial for a mass market it really stinks.

Andy Warhol

Quote for the previous week.

Despre (si pentru...) cercetatorii romani din Romania

Nu este prima oara cand primesc asemenea email-uri (si intuitia imi spune ca nu va fi nici ultima...). Mai precis, am primit pana acum 8 (opt) astfel de mesaje (le pastrez pe toate), in ultimii 3 ani, pe acelasi topic, de la cadre didactice universitare din Romania. Pentru a lasa mesajul sa vorbeasca de la sine, preiau parti din acest email ajuns la destinatie ieri seara:

Stimate domnule Ioan Sebastian Buhai,

Ma numesc [nume persoana retras] si sunt lector la [nume universitate si facultate retras].

[alte informatii de natura personala retrase]

Am gasit informatii biografice despre dumneavoastra pe Ad Astra si Generatia Asteptata si am citit cateva articole in romana ale dumneavoastra in revista Cotidianul. Inainte de toate va felicit pentru realizarile dumneavoastra si va doresc mult succes mai departe in cariera dumneavoastra academica! [parte nerelevanta retrasa] Am avut ocazia sa vizitez [numele universitatii retras] si sa inteleg diferenta dintre facultatile de la noi si cele din strainatate, in special cele din Statele Unite ale Americii sau Uniunea Europeana. Din pacate am fost nevoit sa ma intorc in Romania [parte nerelevanta retrasa] si acum incerc sa gasesc orice bursa sau pozitii temporare de cercetare oriunde in afara. As prefera [numele tarii retras]. Va scriu pentru a va ruga sa ma ajutati sa gasesc asemenea pozitii. Dumneavoastra fiind in mediul academic din afara si cunoscand foarte bine situatia cu pozitiile universitare stiti fara indoiala mai bine decat noi in Romania.

[parte mai putin relevanta retrasa]

Multumesc pentru orice ajutor si imi cer iertare pentru inconvenientele provocate,

Cu multa stima,

[nume persoana retras]

Dupa cum am raspuns si persoanei in cauza (si celor 7 anterioare...), "ajutorul" meu nu poate consta in altceva decat in informatii (in plus, nu sunt deocamdata decat doctorand, deci in mod sigur ati primi informatii mult mai precise si implicit, mai utile, de la altii, cu mult mai multa experienta- sunt destui romani in academe-ul economic, in SUA sau EU). Mai departe depinde doar de aplicant. Esential este background-ul personal, CV-ul cu care te prezinti si, sine qua non, publicatiile stiintifice in subdomeniul tau, pentru orice aplicatie. Din pacate, varsta aplicantului conteaza si ea, destul de mult, mai ales pentru pozitii de inceput in ierarhia academica (postdoctorand sau lector="assistant professor"), mai ales cand nu exista deja publicatii de calitate in jurnale peer-review recunoscute (caz in care persoana ar fi putut deja aplica pentru diverse posturi oriunde in lume fara sa ajunga sa mai intrebe in dreapta si in stanga...). Anunturi despre diferite posturi din academia (si nu doar academia) in economie exista pe foarte multe site-uri online (am incercat o compilatie a celor pe care le consider foarte bune, pe website-ul meu, de exemplu, dar mai sunt si altele; mai multe referinte generale pentru "economistii" din academia sunt aici ). Desigur discutia ar trebui sa includa si situatia cercetarii din Romania, in particular in economie si in alte stiinte sociale (am mai vorbit despre asta) dar si faptul ca foarte mici progrese (epsilon...) s-au facut in ultimii ani. Mult prea putine insa. Deci inteleg foarte bine sentimentul exprimat in mesajul de mai sus. La un moment dat am scris chiar un eseu mai lung pe tema asta- in PDF (acelasi eseu este online si aici, in HTML, cu un rezumat la inceput)- ar trebui sa-i fac un update pentru ca e destul de vechi, dar mare parte din el inca e de actualitate (din pacate...).

PS. Corectie: Nu am decat un singur articol in "revista" Cotidianul, scris la repezeala si acela, deci nu e posibil sa fi citit mai multe articole ale mele acolo :-). In general nu consider ca la inceputul carierei lumea ar trebui sa piarda prea mult timp scriind pentru publicul general, ci ar trebui sa se ocupe de cercetare stiintifica, la propriu. Ca au mai scris ei despre mine (mai mult de bine decat de rau :-)), e altceva.

Song of the day: Best song of all times by the best artists of all times!

Neither the artists nor the song for today need any introduction for they're true Classics! Moreover, as many of my Tinbergen Institute former and current PhD colleagues can, for instance, testify, I can myself (yes, yes, this is not a joke!) perfectly interpret the main (and most complex, the lyrics are definitely almost impossible to remember!) part of this masterpiece (here, with a great live performance on YouTube)!

PS. Specially requested by (and therefore, dedicated to) Anna :-)

Update, 2nd of April '07: All right, for those of you who really did not get it :-). It was 1st of April yesterday, hello!! But I still think Mana Mana is a very funny song that I can sing perfectly. And that Mana Mana muppet is really my alter ego :-).