L'Information est d'Or

To celebrate my 100th post on this blog, what would be more appropriate than to write about the great economist Paul Samuelson who died last week? So what did Samuelson actually do? I could not write any better than Paul Krugman, who was a fellow economist at MIT (they actually shared the same desk at one point), and who describes in his NYT blog what his great contributions to economic science have been: "1. Revealed preference : There was a revolution in consumer theory in the 1930s, as economists realized that there was much more to consumer choice than diminishing marginal utility. But it was Samuelson who taught us how much can be inferred from the simple proposition that what people choose must be something they prefer to something else they could have afforded but don’t choose. 2. Welfare economics : What does it mean to say that one economic outcome is better than another? This was a blurry concept before Samuelson came in, with much confusion about how to think about in...

Aujourd'hui, j'ai pris l'iDTGV pour la premiere fois. Intrigue par ce nouveau concept (est-ce simplement du marketing?) , je demande a une employe de la SNCF: qu'est ce que c'est que l'iDTGV? Elle me répond que c'est comme le TGV normal - même train, même service, mêmes destinations - mais le prix est plus bas. En somme, me dit elle, c'est le "low cost" du TGV. Eh bien non, car les couts (rames, trains, personels, gares, commercial) sont les mêmes. C'est simplement un "low price"! Si la politique tarifaire de l'iDTGV est meilleure que celle du TGV, pourquoi ne pas la faire aussi profiter au TGV normal? Je me demande qui a trouve ce concept économiquement idiot. Cyrille

Interesting comparison of Google and Apple's mobile OS strategy in AppleInsider. While Apple's strategy is established and clear (integrated platform, tight control and brand management), Google has still to find a winning formula. Comparison of business models with technical presentation

Willem Buiter of the Financial Times seems to beleive so in the following article: Time for the ECB to get serious about the overvalued Euro Also an interesting question is should the ECB intervene on the FX market? What's sure is that no other Central Bank has any incentive to devalue the Euro.

From Yoram Bauman , sooo funny (and true :)

The World Economic Forum (WEF) released a new ranking of the most trade-friendly economies. Those are the countries that should benefit most from a World recovery when it occurs. The top ten is composed of financial centres - of which openess is a raison d'être - like Singapour or Hong Kong and North European countries - which have long had a tradition of trade - like Danemark or Sweden. It is interesting to note that 7 out of 10 most trade-friendly economies are European. It is good news for Europe. Or could it be a natural bias from an institution based in Europe (Geneva)? I have noticed with a lot of amusement that when the Indian Economic Times covered the story, they have put a picture of Russia (Moscow I think) to present Norway :) http://economictimes.indiatimes.com/articleshowpics/4750684.cms The full ranking is the following: 1. Singapore 2. Hong Kong 3. Switzerland 4. Danemark 5. Sweden 6. Canada 7. Norway 8. Finland 9. Austria 10. Netherlands

This is a historic decision by the Central Bank of Australia. They decided today to increase their policy rate from 3% to 3.25%. Since the begining of the financial crisis, this is the first bank to make such a move. They will likely be followed by other Central Banks, although maybe with a significant delay. This decision is proof that what used to be the biggest risk - deflation - is now beaten and we can start looking forward. The massive monitary response (lowering of interest rates, quantitative easing and stimulus packages) has worked but we now need to start looking at how to manage the adverse consequences: a monetary policy too accomodating and huge debt. It will be a fine and difficult tuning for central bankers to stop monetary easing at or after there are clear signs of recovery and impending inflation. Some economists, like Paul Stiglitz beleive that we are not out of the woods yet. They invoke the fact that: - unemployement is big and rising, putting a drag ...