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The economic cost of populism

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Re: The economic cost of populism

#61

Post by RandomLensman »

pydry wrote: post #55
RandomLensman wrote: post #19

Earlier quoted context omitted.

Is that even true on populist and financial crises?

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3289741 Yes. It appears that Manuel Funke, Moritz Schularick and Christoph Trebesch may not have been as conscientious as they could have been about reviewing prior literature.

Well, for starters this is newer than their initial work. Also, isn't this looking at the issue the other way around and at a single example?

Edit: post changed the paper linked, but generally my point stands.

Re: The economic cost of populism

#62

Post by toss1 »

inglor_cz wrote: post #56
toss1 wrote: post #15

Earlier quoted context omitted.

>>Are we missing something? Yes H.L.Menken: For every complex problem there is an answer that is clear, simple, and wrong. Populism is about revenge of the narcissistic dullards who are sick of the experts getting to say how things run and what to do. Just because experts also get it wrong sometimes doesn't mean that they should be thrown out, yet the populists are happy to do it (usually backed by behind-the-scenes…

Your argument somewhat hinges on supposed existence of experts who know how things run and what to do . Are there even such experts with regard to the economy? The economic academia is full of competing schools of thought which prescribe completely incompatible recipes how to run things. Which of those are experts and which are fakes? Which one of those schools would you choose to run things in your country? There wa…

There certainly ARE experts in how to implement regulations such as safety of work, airplane, railroad, highway, food, etc. etc. etc. Throwing away their advice endangers everyone and increases costs on everyone.

And again, just because the experts are sometimes wrong does not mean that you should bet against them.

The point is that when intelligent and motivated people put in massive effort to try to figure out how to understand the complexities and get it right, they are a LOT more likely to consistently produce better solutions than random opinion-holders.

It you have a software problem to fix, do you go to one of the developers, or just pick the loudest Karen/Kevin on the customer service line and have them fix it?

That is really the choice. Of course developers made the error that put the bug there in the first place, but that does not mean that the complainer has an actual fix.

Re: The economic cost of populism

#63

Post by abecedarius »

pydry wrote: post #45
mark_l_watson wrote: post #36

So what? GDP is also increased with more wars, and other activities that enrich the elites and usually do much less for middle and lower classes. I would like to see the “happiness index’ for populist vs. non-populist led countries. Since counterfactuals are used in the abstract, I will add one: normalize for each countries’ naturual resources.

This. If the populist leader reduces the GDP by 2% and decreases a high gini coefficient by 0.2 that's a hit-it-out-of-the-park economic win for the majority of people. Not according to the authors of the study, obviously. To them an extra 80 cents in a homeless guy's pocket is worse for everybody than an extra dollar in Bill Gates' pocket. Then there's the reversal of cause and effect - were those populists the caus…

The paper covers data on gini coefficients and sees no evidence of its reduction.

Re: The economic cost of populism

#64

Post by inglor_cz »

toss1 wrote: post #62
inglor_cz wrote: post #56

Earlier quoted context omitted.

Your argument somewhat hinges on supposed existence of experts who know how things run and what to do . Are there even such experts with regard to the economy? The economic academia is full of competing schools of thought which prescribe completely incompatible recipes how to run things. Which of those are experts and which are fakes? Which one of those schools would you choose to run things in your country? There wa…

There certainly ARE experts in how to implement regulations such as safety of work, airplane, railroad, highway, food, etc. etc. etc. Throwing away their advice endangers everyone and increases costs on everyone. And again, just because the experts are sometimes wrong does not mean that you should bet against them. The point is that when intelligent and motivated people put in massive effort to try to figure out how…

"work, airplane, railroad, highway, food ... software problem to fix"

Narrow fields like these are usually non-controversial. Populists don't run around screaming about abolishing the traffic lights or veterinarian checks on meat. There are exceptions like "chlorinated chicken", but these are the exceptions that prove the rule.

The controversy usually involves the macro stuff where value of expert judgment becomes questionable. Like "how many soldiers and bases worldwide do we need"? "Should we confront China/Russia or appease it?" "Is mass immigration from the Islamic world desirable and how should it be managed?" etc. These are the real flashpoints of modern politics.

Re: The economic cost of populism

#65

Post by pydry »

RandomLensman wrote: post #61
pydry wrote: post #55

Earlier quoted context omitted.

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3289741 Yes. It appears that Manuel Funke, Moritz Schularick and Christoph Trebesch may not have been as conscientious as they could have been about reviewing prior literature.

Well, for starters this is newer than their initial work. Also, isn't this looking at the issue the other way around and at a single example? Edit: post changed the paper linked, but generally my point stands.

This paper was just released.

Re: The economic cost of populism

#66

Post by toss1 »

inglor_cz wrote: post #64
toss1 wrote: post #62

Earlier quoted context omitted.

There certainly ARE experts in how to implement regulations such as safety of work, airplane, railroad, highway, food, etc. etc. etc. Throwing away their advice endangers everyone and increases costs on everyone. And again, just because the experts are sometimes wrong does not mean that you should bet against them. The point is that when intelligent and motivated people put in massive effort to try to figure out how…

"work, airplane, railroad, highway, food ... software problem to fix" Narrow fields like these are usually non-controversial. Populists don't run around screaming about abolishing the traffic lights or veterinarian checks on meat. There are exceptions like "chlorinated chicken", but these are the exceptions that prove the rule. The controversy usually involves the macro stuff where value of expert judgment becomes qu…

>>Narrow fields like these are usually non-controversial.

These were just obvious examples, and you are correct that populist politicians may not primarily campaign specifically on reducing regulation, but they consistently DO mention it in campaigning and consistently do it once in office, because they're usually sponsored by moneyed/corporate interests.

>>"how many soldiers and bases worldwide do we need"..."Should we confront China/Russia or appease it?"

Yes, the populists are consistently gong for appeasement and the "why should we spend money abroad", and opting to allow (or in the 2017-21 admin, actively curry favor with) authoritarians, because populist leaders are almost always authoritarians (whether rightists or leftists), as populist leaders want the simplistic solution of "strongman leaders".

This consistently leads to far worse results within a decade or two. Short term, less is spent overseas. But then the authoritarians make gains and start creating problems that cannot be ignored, and the cost of pushing back has grown far higher. That's the problem with authoritarians; they DGAF about words of concern or condemnation. If they break international law and only get words of condemnation and slap-on-the-wrist sanctions, they read this as approval to go further. Then they do. This is exactly what happened with Putin. He bombed civilians and/or illegally "annexed" territory in Chechnya, Syria, Georgia, Crimea, Donbas, etc. and got no real pushback. So, the thought it would be OK to invade all of Ukraine. This is a rolling disaster for everyone, brought about by failure to push back in earlier administrations (including the 2009-17 admin failing to push back in Syria & Crimea).

Re: The economic cost of populism

#67

Post by RandomLensman »

pydry wrote: post #65
RandomLensman wrote: post #61

Earlier quoted context omitted.

Well, for starters this is newer than their initial work. Also, isn't this looking at the issue the other way around and at a single example? Edit: post changed the paper linked, but generally my point stands.

This paper was just released.

Yes and no. This is work a few years old. And as I said, the paper you cite is looking at the situation from the other end, i.e., economic effects on governments.

Re: The economic cost of populism

#68

Post by synecdoche »

FrustratedMonky wrote: post #48
LAC-Tech wrote: post #21

Earlier quoted context omitted.

Essentially a meaningless term then. Everyone in mainstream politics has to present some kind of simple solution that ignores the complexities of the problem, because you can't pass a complex solution through a media filter and get voters out the other side. So everything is populist. Again which makes the term meaningless.

That is correct. To communicate a leader must boil down complex issues. To explain effectively. It probably comes down to a word count and what can be chanted. Take immigration, very complex. Populist "Build a Wall". Super simple, can be chanted. A more Capable Leader might take several sentences, or paragraphs to digest such a difficult subject. Still simplified, still glossing over a lot, but trying to convey some…

Generally, even though an issue is complex it doesn't necessarily follow that the conclusion or solution, after analysing all possible aspects, must be complex. It may be simple. Or, conversely, that if a conclusion is simple to implement, it doesn't necessarily follow that the issue or analysis was simple.
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