On Sunday in Global Trends, we will discuss the rise of new technologies. This part of the class affords an opportunity to discuss a wide range of topics related to disruptive technologies. We start with a discussion of monetary and financial innovations, including crypto. We then move to a discussion of automation and AI. And we conclude the day with a wide-ranging discussion of inequality trends around the world, and the possible solutions to rising inequality in many countries. So this is the perfect opportunity to bring to your attention additional resources on these matters:
1) On cryptocurrencies. I highly recommend a new episode of Allison Schrager's Risk Talking podcast. In this podcast episode, Dr Schager interview Perry Mehrling, a professor at Boston University who is an unabashed skeptic when it comes to cryptocurrencies. I am not quite as negative on the prospects for useful functions of crypto, but I have to say that Professor Mehrling brings up good points (some of which are echoed in recent posts on our Global Trends discussion forum). More generally, Risk Talking is a welcome addition to the growing list of good economics-oriented podcasts now on offer.
2) On automation. Self-driving trucks, which will form the subject of our case discussion for Module 5, are in the news again. One of the remaining players in this space, TuSimple, is in the hot seat because of an accident involving one of its trucks, last April. The WSJ has all the details. Whenever an autonomous vehicle is involved in an accident, it becomes the subject of a huge amount of public scrutiny. Of course, no comparable public scrutiny is applied to accidents that occur when a human is driving, despite evidence that these accidents are much more common, per mile driven (this evidence, however, is still contested). Such a bias against novelty is quite common, and applies to many new technologies (more so even outside the US, which has a culture more accepting of technological disruption than most other countries).
3) On inequality. As the module makes clear, many countries around the world have experienced increases in income inequality over the last few decades. The US is a case in point. But the evidence is not without its critics, because inequality is hard to measure: do you use pre-tax or post-tax inequality? How to you take into account the changing quality of goods that a dollar of income affords? Are the price indices that apply to rich and poor people the same (the rich tend to consume more of the goods and services whose prices have risen steeply in recent times, such as healthcare, education and housing)? From the Journal of Political Economy comes the latest salvo in this debate. The authors of this study argue that while income inequality has risen in the US, consumption inequality has not, at least not to the same degree - when you measure things right. Other good news on this front include data from Thomas Piketty's World Inequality Database (WID). I blogged about this a few months ago. Of course, these two resources are about the US, and trends in other countries, particularly fast-growing emerging markets like China and India, may differ. Data for these other countries are easy to find on the WID website.