In 2001, Shoshana Zuboff coined the term ‘surveillance capitalism’ for what once was a panacea in the wake of the dot-com bust, which now has emerged as a form of capitalistic accumulation of behavioral data.
As history repeats itself, capitalism reinvents itself in different shapes and forms. Capitalism, as defined by Marx, is a socio-economic relation between the proletariat and the bourgeoisie. It was not only the exchange of commodities but the advancement of capital to generate profits.
Although Marx believed that capitalism, due to its internal contradiction, will stagnate and eventually be replaced by socialism, history has witnessed capitalism reinvent itself over and over again. In its present form, capitalism has yet survived on our behavioral data as its capital and the tech giants, Google, Facebook, Microsoft, Amazon, Apple, to name a few, as…
Human capital accumulation is equally essential to the production process in an economy, as is physical capital formation. The article outlines the evolution of economic growth theory — from homogeneous labor to human capital.
For long, economic growth theories and models centered on physical capital accumulation, ignoring human capital and its contribution to the production process.
Human capital formation is an essential factor of not only economic growth but development. Not to forget, the Asian miracle of economic transformation of nations like Japan, South Korea, Taiwan, and China relied on human capital formation.
The neoclassical growth theory, pioneered by Solow Model (1956), assumed competitive markets and excluded externalities. The economic value of factors of production — the marginal product — equaled their social value. Although it included physical capital, labor remained a homogenous commodity…
A Universal and Unconditional Basic Income is a disincentive to employment and financial sovereignty that ought to do more harm than good in the long run.
The idea of a Universal Basic Income is to provide unconditional universal cash transfer without having to fulfill any qualifications. It is an income for all, irrespective of one’s income, education, or work. This idea has entered the public discourse, now and then, due to rising inequalities between the developed and developing nations.
The proposal resembles Milton Friedman’s idea of negative income taxation, according to which citizens earning below a threshold receive a cash transfer instead of paying taxes. The Universal Basic Income contrast with this idea as it does not exclude anyone from its ambit.
An unconditional income to…
Sparing the technical details of what happened, the article draws lessons from the GameStop frenzy and comments on the growing financialization of the world economy and its implications on the state of present-day capitalism.
And it happened yet again.
When a group of Reddit-obsessed amateurs short-squeezed hedge funds and billionaire investors, an investing company, Robinhood conveniently restricted stock purchases. The firm, though, in doing so, does not stand up to its name. Robinhood, the heroic outlaw in those long-lost folktales, used to rob the rich and provide for the poor.
However, present-day Robinhood ensures prosperity and power remain concentrated in the hands of wealthy investors and funds. When smaller investors use the same techniques, these methods become inappropriate (let’s say, inadvertent for the market-makers). On the face of it, capitalists have monopolized finance leading…
A theory to explain causal pathways of anticipated impact after initiating an intervention, used in monitoring and evaluation methods, in development economics.
To conduct experimentation in development economics, practitioners use the method of monitoring and evaluation. These processes involve administering interventions to a target sample to measure impact after a pre-determined period. The theory of change is a tool used to define the research hypothesis for experimental or non-experimental studies. It is a mechanism that would cause the initial conditions to change.
While correlation is a relationship between the initial conditions and outcomes, causation — the theory of change — specifies ‘how’ and ‘why’ these interventions lead to impact. It is the initial conceptualization, a roadmap, or a blueprint for development research.
While the governments and policymakers set development goals, they often neglect the privations of rural areas. The article talks about Michael Lipton’s Urban Bias Thesis, illustrating this phenomenon and its present-day relevance.
Urban-rural dynamics are predominant for economic growth and development. While the rural areas provide labor, capital, and the agricultural surplus to establish factories in urban states, urban areas produce machinery and durables for rural lands. Their co-existence is a driving factor of economic prosperity and human development.
The rural or agricultural sector, the foundation of an economy, in general, houses the poor, the illiterate, and the traditional. On the other hand, the urban or industrial sector is wealthy, highly skilled, and modern. …
In the face of climate change, nudging human behaviors with more transparent and symmetric information might be a way to protect the environment from severe damage any further.
What if electric vehicles were the new status symbol? People who could afford to get a new car would consider buying an electric one instead. On the other hand, people who are less likely to make such a change immediately would be curious to try out the popularity-struck option and plan their purchase. Economists describe this mechanism as signaling as it signals people to buy a product when in fashion.
When green is the new gold, people become less hesitant to get their hands on it regardless of their concern for the environment. …
Market power, often calculated by the Herfindahl-Hirschman Index, has increased, within several industries, with the advent of globalization and digitization. But does more power mean more efficiency in market outcomes?
With industrial development, technological advancement, and globalization, markets have become more concentrated and less competitive. Further, excessive regulations, or the lack thereof, play a part in increasing concentration. Evidence on markets and firms suggests that while the concentration of power has increased in the United States and Japan over the years, European firms follow a relatively mixed market structure. (OECD, 2018)
The microeconomic theory of market structures provides an analysis of the concentration of players in an industry. It does so by comparing their prices, outputs, and profits. …
This article outlines a theory of economic development and the inequities of profits, consumption, and savings by different socio-economic classes.
Why are some nations rich and others poor? These inequalities — whether economic, social, or political — are the by-products of many inequities persisting in the under-developed and developing economies.
In an essay titled Economic Development with Unlimited Labor Supply (1954), Arthur Lewis, a development economist, employed the Classical assumptions of unlimited labor supply at subsistence wages to conceive rural-urban dynamics. This assumption explains the condition of surplus labor to achieve economic development in Marxist literature. It makes for a fundamental presupposition to formulate this model of distribution, accumulation, and growth.
An under-developed economy is, primarily, agrarian society with an…
Fields of psychology and sociology dominated the study of criminology until economist Gary Becker introduced the role of preferences in the theory of criminal behavior and how punishment can influence these preferences.
While the root cause of crime is a topic of perpetual debate, the increase in criminal activity in a polity is usually associated with a downturn in the economy. This correlation is not accurate at times. Even if it is, the causal relation is spurious.
According to Pew Research, post-1990s, there has been a decline in violent and property crime rates in the United States, even during the 2006 financial crash and recession.
In the book Freakonomics: A Rogue Economist Explores the Hidden Side of Everything, the authors analyze the decline in crime rates in the 1990s as a result…
