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	<title>Comments for Knowledge and the Wealth of Nations</title>
	<link>http://kwonbook.com</link>
	<description>A Story of Economic Discovery</description>
	<pubDate>Thu, 28 Aug 2008 16:47:53 +0000</pubDate>
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		<title>Comment on Mutual Forgiveness vs. The Merciful Padding of Blather by Karl Eschelbach</title>
		<link>http://kwonbook.com/2006/06/26/mutual-forgiveness-vs-the-merciful-padding-of-blather/#comment-493</link>
		<dc:creator>Karl Eschelbach</dc:creator>
		<pubDate>Thu, 09 Nov 2006 22:40:55 +0000</pubDate>
		<guid>http://kwonbook.com/2006/06/26/mutual-forgiveness-vs-the-merciful-padding-of-blather/#comment-493</guid>
		<description>Having just finished Knowledge, I wonder whether all those "invisible hand" economists (Arrow, Solow, Tobin, Lucas, Becker),  whose models perforce support Cato institute economics (limited government intervention, low taxes, unfettered property rights), neglected "increasing returns" for purely politcal reasons.  Did the right-wing philosophy come first only to be follwed by the equations or was it the other way around? Note that no major economist has published a detailed study of the impact of the Bush tax cuts on the cost of capital.  The reason is purely political.  The invisible hand economists supported the tax cuts (pace Greenspan) not because of some duty to economic theory but becasue the tax cuts benefited a few wealthy Republicans.  Any study would show that the owners of stocks are overwhelmingly tax indifferent (pension funds, hedge funds, private equity funds, mutual funds and 401ks) and therefore the reduction of the marginal tax on dividends and capital gains had little macro effect.  Add the impact of the alternative minimum tax and you simply have a government subsidy for a few wealthy Republican donors.  No wonder no one really wants to sudy tax policy using real data!  It might lead to the "wrong" answer and Alan Meltzer would not want that to happen.</description>
		<content:encoded><![CDATA[<p>Having just finished Knowledge, I wonder whether all those &#8220;invisible hand&#8221; economists (Arrow, Solow, Tobin, Lucas, Becker),  whose models perforce support Cato institute economics (limited government intervention, low taxes, unfettered property rights), neglected &#8220;increasing returns&#8221; for purely politcal reasons.  Did the right-wing philosophy come first only to be follwed by the equations or was it the other way around? Note that no major economist has published a detailed study of the impact of the Bush tax cuts on the cost of capital.  The reason is purely political.  The invisible hand economists supported the tax cuts (pace Greenspan) not because of some duty to economic theory but becasue the tax cuts benefited a few wealthy Republicans.  Any study would show that the owners of stocks are overwhelmingly tax indifferent (pension funds, hedge funds, private equity funds, mutual funds and 401ks) and therefore the reduction of the marginal tax on dividends and capital gains had little macro effect.  Add the impact of the alternative minimum tax and you simply have a government subsidy for a few wealthy Republican donors.  No wonder no one really wants to sudy tax policy using real data!  It might lead to the &#8220;wrong&#8221; answer and Alan Meltzer would not want that to happen.</p>
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		<title>Comment on What Is a Turnpike? by Peter McMenamin, PhD</title>
		<link>http://kwonbook.com/2006/05/26/what-is-a-turnpike/#comment-40</link>
		<dc:creator>Peter McMenamin, PhD</dc:creator>
		<pubDate>Tue, 01 Aug 2006 19:46:03 +0000</pubDate>
		<guid>http://kwonbook.com/2006/05/26/what-is-a-turnpike/#comment-40</guid>
		<description>I got my PhD in economics at Berkeley during the 1970s.  Although I had a mathematical background, at that time in my life I was shying away from the deep mathematics I could have pursued, and became interested in health care (where I've been active for 35 years now.)

Nonetheless, it was impossible not to be aware that there was controversy and interest in development theory, especially with the work on turnpike theorems.  But having come from the East and having spent a junior year at the LSE, I was always curious about the naming of these parts.  Lionel McKenzie points to Samuelson, who of course was from the East, in fact, Cambridge, Mass.  Anyone who had grown up with the Ivy League, of course, would have turned to the Mass Pike and the Connecticut Turnpike for an analogy for the faster routes.  But if Samuelson had spent more of his academic life in New York, would he have proposed a highway theorem?  Would a meandering path to development have posed a parkway problem?  And if he had headed out to the West Coast to Berkeley or Stanford maybe he would have developed a series of freeway theorems.  Could we all get to the steady state via an interstate?  Actually, had he been at that other Cambridge would the topic be known for its dual carriageway theorems?</description>
		<content:encoded><![CDATA[<p>I got my PhD in economics at Berkeley during the 1970s.  Although I had a mathematical background, at that time in my life I was shying away from the deep mathematics I could have pursued, and became interested in health care (where I&#8217;ve been active for 35 years now.)</p>
<p>Nonetheless, it was impossible not to be aware that there was controversy and interest in development theory, especially with the work on turnpike theorems.  But having come from the East and having spent a junior year at the LSE, I was always curious about the naming of these parts.  Lionel McKenzie points to Samuelson, who of course was from the East, in fact, Cambridge, Mass.  Anyone who had grown up with the Ivy League, of course, would have turned to the Mass Pike and the Connecticut Turnpike for an analogy for the faster routes.  But if Samuelson had spent more of his academic life in New York, would he have proposed a highway theorem?  Would a meandering path to development have posed a parkway problem?  And if he had headed out to the West Coast to Berkeley or Stanford maybe he would have developed a series of freeway theorems.  Could we all get to the steady state via an interstate?  Actually, had he been at that other Cambridge would the topic be known for its dual carriageway theorems?</p>
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		<title>Comment on Early Notices by Philippe L</title>
		<link>http://kwonbook.com/2006/05/13/early-notices/#comment-11</link>
		<dc:creator>Philippe L</dc:creator>
		<pubDate>Fri, 26 May 2006 16:13:27 +0000</pubDate>
		<guid>http://kwonbook.com/2006/05/13/early-notices/#comment-11</guid>
		<description>The review by Krugman was indeed terrific but it does take issue with the prominence and weight you assign to Romer 90 (although this misrepresentation does not detract from the overall value of the book, in Kruman's opinion). Since the importance of Romer 90 as a pivotol moment is central to your book, I am hoping you will use this blog to respond to Krugman. Or is your focus on Romer 90 just a device to write about new growth theory? Thanks.

DW: As happy as I was with Paul Krugman's review (and that of The Economist), neither had much to say about the argument of the book.  So yes, at some point, I will address his doubts on this page. I'll mull it over for a bit. I am not much of a blogger at heart!  </description>
		<content:encoded><![CDATA[<p>The review by Krugman was indeed terrific but it does take issue with the prominence and weight you assign to Romer 90 (although this misrepresentation does not detract from the overall value of the book, in Kruman&#8217;s opinion). Since the importance of Romer 90 as a pivotol moment is central to your book, I am hoping you will use this blog to respond to Krugman. Or is your focus on Romer 90 just a device to write about new growth theory? Thanks.</p>
<p>DW: As happy as I was with Paul Krugman&#8217;s review (and that of The Economist), neither had much to say about the argument of the book.  So yes, at some point, I will address his doubts on this page. I&#8217;ll mull it over for a bit. I am not much of a blogger at heart!  </p>
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		<title>Comment on By Way of Introduction by Tom Moran</title>
		<link>http://kwonbook.com/2006/04/29/by-way-of-introduction/#comment-8</link>
		<dc:creator>Tom Moran</dc:creator>
		<pubDate>Sat, 13 May 2006 06:37:48 +0000</pubDate>
		<guid>http://kwonbook.com/2006/04/29/by-way-of-introduction/#comment-8</guid>
		<description>Just finished the book. Very interesting and illuminating. You point out the importance of mathematical language, while, of course, writing a "literary" book. As a former math major I'd appreciate a pointer to a description in/of the math involved.     TM

 
I'm not aware of a gloss on the nonconvex analysis of romer's thesis, which is one reason I didn't attempt anything myself in the book.  Martin Weitzman has a book just out called &lt;em&gt;Income, Wealth and the Maximum Principle&lt;/em&gt; in which he develops a "standard" version of dynamic optimization techniques for economic problems, using mainly calculus at the level of an advanced undergraduate undergraduate.  But the background of convex analysisis from which the departure too place probably is not what your interested in.  I'll call around and see if I can elicit a proper answer.            DW</description>
		<content:encoded><![CDATA[<p>Just finished the book. Very interesting and illuminating. You point out the importance of mathematical language, while, of course, writing a &#8220;literary&#8221; book. As a former math major I&#8217;d appreciate a pointer to a description in/of the math involved.     TM</p>
<p> <br />
I&#8217;m not aware of a gloss on the nonconvex analysis of romer&#8217;s thesis, which is one reason I didn&#8217;t attempt anything myself in the book.  Martin Weitzman has a book just out called <em>Income, Wealth and the Maximum Principle</em> in which he develops a &#8220;standard&#8221; version of dynamic optimization techniques for economic problems, using mainly calculus at the level of an advanced undergraduate undergraduate.  But the background of convex analysisis from which the departure too place probably is not what your interested in.  I&#8217;ll call around and see if I can elicit a proper answer.            DW</p>
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		<title>Comment on New Argonauts, Different Fleece by Clay Wescott</title>
		<link>http://kwonbook.com/2006/05/01/new-argonauts-different-fleece/#comment-6</link>
		<dc:creator>Clay Wescott</dc:creator>
		<pubDate>Sun, 07 May 2006 11:22:35 +0000</pubDate>
		<guid>http://kwonbook.com/2006/05/01/new-argonauts-different-fleece/#comment-6</guid>
		<description>Your mention of Saxenian's work prompts this comment.

I recently led a research project on the increased use of associations of highly skilled expatriate nationals in knowledge exchange and capacity development, and on the policies and level of awareness among Asian countries to capture the benefits of such practices. The emphasis is on knowledge exchange rather than knowledge transfer, since the former suggests the two-way knowledge flows increasingly evident: from host to home countries (e.g. advanced technology) and from home to host countries (e.g. reputational advice on potential business partners). Detailed reviews of such knowledge exchanges were carried out in the Philippines, People's Republic of China (PRC), and Afghanistan to explore innovative means of improving policies and using networks for knowledge exchange that might otherwise be carried out by non-diaspora, expatriate professionals. Such knowledge exchanges can increase the development impact of remittances, and are valuable in their own right. The studies were carried out in consultation with the respective diaspora organizations, and were completed in 2005.

Other researchers have attempted to conceptualize these practices with respect to diasporas under the rubric of “transnationalism”, “scientific diaspora”, and “brain circulation” (Saxenian). Another line of research suggests that the strong family ties linking traditional overseas Chinese business networks are morphing into much larger and more dispersed networks with weak ties. These weak tie networks, which include many of the emerging networks among overseas professional diasporas, are less costly to maintain than strong-tie networks, and are good for casting a broad net for unique and novel information. However, weak tie networks are less effective for transferring complex, non-codified knowledge, i.e. tacit knowledge that isn’t written down, and derives from personal, practical know-how, nor for transferring knowledge that is dependent on other hard-to-access knowledge.

For a summary of the research, see "Promoting Knowledge Exchange through Diasporas", in Government of Australia, Proceedings of G-20 workshop on Demographic Challenges and Migration : 265-308. &lt;a href="http://www.g20.org/Public/Publications/Pdf/2005_workshop_proceedings.pdf"&gt;&lt;u&gt;&lt;font color="#0000ff"&gt;http://www.g20.org/Public/Publications/Pdf/2005_workshop_proceedings.pdf&lt;/font&gt;&lt;/u&gt;&lt;/a&gt;

--
Clay G. Wescott
Asia Pacific Governance Institute
Manila, Philippines
632-810-7931
skype cwescott
email cwescott@post.harvard.edu</description>
		<content:encoded><![CDATA[<p>Your mention of Saxenian&#8217;s work prompts this comment.</p>
<p>I recently led a research project on the increased use of associations of highly skilled expatriate nationals in knowledge exchange and capacity development, and on the policies and level of awareness among Asian countries to capture the benefits of such practices. The emphasis is on knowledge exchange rather than knowledge transfer, since the former suggests the two-way knowledge flows increasingly evident: from host to home countries (e.g. advanced technology) and from home to host countries (e.g. reputational advice on potential business partners). Detailed reviews of such knowledge exchanges were carried out in the Philippines, People&#8217;s Republic of China (PRC), and Afghanistan to explore innovative means of improving policies and using networks for knowledge exchange that might otherwise be carried out by non-diaspora, expatriate professionals. Such knowledge exchanges can increase the development impact of remittances, and are valuable in their own right. The studies were carried out in consultation with the respective diaspora organizations, and were completed in 2005.</p>
<p>Other researchers have attempted to conceptualize these practices with respect to diasporas under the rubric of “transnationalism”, “scientific diaspora”, and “brain circulation” (Saxenian). Another line of research suggests that the strong family ties linking traditional overseas Chinese business networks are morphing into much larger and more dispersed networks with weak ties. These weak tie networks, which include many of the emerging networks among overseas professional diasporas, are less costly to maintain than strong-tie networks, and are good for casting a broad net for unique and novel information. However, weak tie networks are less effective for transferring complex, non-codified knowledge, i.e. tacit knowledge that isn’t written down, and derives from personal, practical know-how, nor for transferring knowledge that is dependent on other hard-to-access knowledge.</p>
<p>For a summary of the research, see &#8220;Promoting Knowledge Exchange through Diasporas&#8221;, in Government of Australia, Proceedings of G-20 workshop on Demographic Challenges and Migration : 265-308. <a href="http://www.g20.org/Public/Publications/Pdf/2005_workshop_proceedings.pdf"><u><font color="#0000ff"><a href="http://www.g20.org/Public/Publications/Pdf/2005_workshop_proceedings.pdf" rel="nofollow">http://www.g20.org/Public/Publications/Pdf/2005_workshop_proceedings.pdf</a></font></u></a></p>
<p>&#8211;<br />
Clay G. Wescott<br />
Asia Pacific Governance Institute<br />
Manila, Philippines<br />
632-810-7931<br />
skype cwescott<br />
email <a href="mailto:cwescott@post.harvard.edu">cwescott@post.harvard.edu</a></p>
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