Research Briefs

 

“Ireland Can Show Greece a Way out of the Crisis”

“The competing fiscal and Keynesian analyses of Greece’s financial problem both miss the point: Greece will have to export its way out of its crisis, writes Ricardo Hausmann. But it can’t devalue its currency to make its exports more competitive, and it “does not have what it takes to be as rich as it is,” Hausmann writes. In The Atlas of Economic Complexity, Hausmann and his coauthors calculated the productive knowledge (the know-how to make goods and the ability to grow and prosper) of more than 100 countries. Greece had the biggest gap between its current income and the productive knowledge of its exports. The good news is that Greece is second only to India in its ability to move to exporting more complex goods. “Putting resources into creating the productive base for a more prosperous future is more important and less painful than wasting them in protecting an unsustainable past.””

Ricardo Hausmann, “Ireland Can Show Greece a Way out of the Crisis” Financial Times

“The Collapse of the Soviet Union and the Productivity of American Mathematicians”

“The fall of the Soviet Union in the early 1990s had enormous consequences for the world. One small one affected mathematics: In the wake of the collapse, 336 mathematicians moved from the former Soviet Union to the United States. This phenomenon provided George Borjas with a unique opportunity to study the area of knowledge production and the impact of immigration on it. “In the period between the establishment and fall of communism, Soviet mathematics developed in an insular fashion and along different specializations than American mathematics,” Borjas and his coauthor write. They found that American mathematicians whose research overlapped with that of the Soviets suffered a reduction in productivity, were more likely to move to lower-quality institutions, and stopped publishing research earlier in their careers. “There is no evidence, however, that there was a substantial increase in the size of the American mathematics pie as a result of the Soviet influx.”

George Borjas, “The Collapse of the Soviet Union and the Productivity of American Mathematicians” National Bureau of Economic Research

“Spending Won’t Fix What Ails U.S. Infrastructure”

“President Barack Obama’s six-year, $476 billion transportation bill, included in his 2013 budget, shows the national penchant for transportation projects and the popularity of the notion that the United States has to continue building big if it is to resist China’s assault on its lead power status. “But success in middle age — for people and nations — requires wisdom and cunning more than pumped-up brawn,” writes Edward Glaeser. Glaeser suggests seven ways to improve transportation in the United States: Let users pay; implement congestion pricing; defederalize transport spending; institutionalize maintenance funding; promote private-public partnerships; cherish the bus; and split up the Port Authority. “U.S. transportation does have problems — traffic delays in airports and on city streets, decaying older structures, excessive dependence on imported oil — but none of these challenges requires the heroics of a 21st-century Erie Canal. Instead, they need smart, incremental changes that will demonstrate more wisdom than brute strength.”

Edward Glaeser“Spending Won’t Fix What Ails U.S. Infrastructure” Bloomberg News

“What Have We Learned”

“As America’s nineyear adventure in Iraq draws to a close, a final accounting can begin. More than 2 million U.S. troops served in Iraq, with 4,486 killed and 32,000 wounded in action. The cost of the war will be at least $4 trillion, writes Linda Bilmes, and that figure could climb much higher depending on how many veterans require long-term care. (More than a third of recent veterans report having a service connected disability, Bilmes notes.) “Amid this gloomy picture it is timely to ask what lessons the war should hold for America,” Bilmes writes. Among them: the unpredictability of the costs of war; the need for a system to track military and war spending (government accounting offices have complained repeatedly that we lack the basic accounting system necessary to understand where money is spent); an overhaul of the system for transitioning U.S. troops back into civilian society; and a provision for funding the ongoing costs of caring for war veterans.”

Linda Bilmes, “What Have We Learned” The Boston Globe

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