To Be Titled

“Currency Wars Rap Battle” [HT: FP Passport]

(Source: youtube.com)

Disciplinary boundaries matter, unfortunately. When an economist tries to sound insightful, the “insight” sounds banal to political scientists:

What do we learn from this? It’s not the global mechanisms that are wonky. It’s the weakness of the national governments pulling the levers. This would be as true of a plurilateral trade deal as of a multilateral, of course. There is no technocratic solution to the Doha round. It’s a political problem.

Whether the reasons are environmental or economic, the movement toward shopping local stuff has both a progressive side and a regressive side. The movement is purportedly for improving local and global welfare but doing so in a way that turns communities less interdependent and more autarkic. [From The Economist]

But Andree Garcia, the owner and chef of Les Iles en Ville, says the EU ban has been “great advertising” - and as a result has moved up seal dishes from occasional specialities to a daily regular.

“Seal has become extremely popular since everybody started talking about it,” she said. “We have Canadian diners who want to support the seal industry and we have tourists who had never heard of it before. We get a lot of customers from Europe and they all want to taste seal.”

I’m guessing that most trade disputes—even highly publicized ones—don’t have this aspect, where the dispute increases the demand for the product in dispute. I just have one question at this point: Does it taste like chicken?

The measured trade-cost rise is estimated to be similar in the two events, yet tariffs have not risen in today’s crisis in anywhere near the extent to which they did in the 1930s. This seems to indicate that a good fraction of today’s trade drop is due to non-tariff trade policy and other trade frictions – e.g. evaporating trade credit, credit constraints in the market for consumer durables, and other reported changes in policy have been of equal magnitude (see Ferrantino and Larsen 2009 on the latter).

The best evidence we have on new trade barriers, the Global Trade Alert initiative, does not suggest a rise in measured protectionism anywhere near that observed in the 1930s. There must be something else driving the rise in trade frictions. Perhaps the protection is so murky that even GTA cannot document it? Perhaps the trade credit problem is the culprit and thus more important than many argue (Chauffour and Farole 2009)?

Another way to interpret this finding is that the decline in trade is not due to either of the traditional factors that we think as affecting trade—technology and trade policies.

A united Korea — combining Asia’s fourth biggest economy with one of its poorest — could surpass that of Germany or Japan in economic might in the next 30-40 years, U.S. investment bank Goldman Sachs said on Monday.

To the extent that this is true, the choices pose an interesting dilemma for the neighboring and other powers in the world: promote a divided Korea with belligerent DPRK as part of the picture or promote unification leading to a rising regional hegemon.

Clay Shirky on collaborative arrangements replacing traditional institutions—e.g. firms, journalists, etc.—given the right information infrastructure. What he argues is happening at the domestic level seems to be how international institutions (e.g. the GATT/WTO) have long functioned—by decentralizing implementation and enforcement. In that sense, international institutions have always been closer to collaborative arrangements than traditional institutions at the domestic level. This is especially true since whatever collective outcomes that international institutions seek to generate, the state-level behaviors have to be self-enforcing like Flickr users voluntarily choosing to tag their photos with certain keywords in Shirky’s example.

An interesting question is whether international institutions will better utilize the information technology infrastructure that has emerged and is evolving. The best example so far of such an attempt seems to be http://www.globaltradealert.org/

As reported in today’s Wall Street Journal, the Samoan prime minister has ordered a switch from driving on the right (a la the U.S. and most of the rest of the world) to driving on the left (a la Britain and its former colonies). The idea is that because Australia and New Zealand do it in the British style, the switch will make it easier and cheaper for Samoans to purchase used cars.

I’m pretty sure this is an under-analyzed aspect of international relations. There is definitely at least an article to be written on this phenomenon.

As most parents of small children will reluctantly admit, nothing can occupy a child quite like television. Unfortunately, the scientific evidence suggests that using the boob tube as a babysitter has its price: the more time babies spend sitting in front of the screen, the more their social, cognitive and language development may suffer. Recent studies show that TV-viewing tends to decrease babies’ likelihood of learning new words, talking, playing and otherwise interacting with others.

A previous director of the State Department’s Policy Planning Staff said that the U.S. government did not fully understand (or seek to analyze) the consequences of U.S. foreign policy on other countries’ domestic politics. President Obama’s attempt to forego the two-level game and to speak directly to Iranian people is certainly interesting. We will see how the message is received. [Via FP Passport]

Update: The official White House link to the message.