The Unassuming Economist

From Branko Milanovic and the Globalist:

“Under the influence of Amartya Sen, we have been “nudged” towards a reassessment of the relative merits of “The theory of moral sentiments “ (TMS) and “The Wealth of Nations” (WN). Sen has done a lot to bring Smith’s early work out of relative obscurity where it was consigned by two centuries of success of The Wealth of Nations.

What remains true is that many people around the world continue to have a remarkably distorted view of The Wealth of Nations. Not much beyond the (in)famous “invisible hand of the market.”

Bad government

In reality, there are no “good guys” in The Wealth in Nations. Of course, the government comes in for special criticism.

Smith argues against its rapacity in putting up high tariffs, its foolishness in following mercantilist policies, its pettiness in constraining the system of “natural liberty,” its attempts to decide where people should live (the law of settlement, a hukou-like system was then in existence in Britain).

(…)

Bad businessmen

But businessmen are no better. As soon as they are given half a chance, perhaps just after having gotten rid of some particularly nefarious government regulation, they are back to plotting how to “restrain” the market, to pay suppliers less, destroy competitors, cheat workers (see today’s IT companies, Walmart, Amazon).

In the famous quote, “people of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices” (Book 1, Ch. 8).

In their mad ambition, they try to rule the world (see Davos): “…the mean rapacity, the monopolizing spirit of merchants and manufacturers, who neither are, nor ought to be, the rulers of mankind” (Book 4, Ch. 3, p. 621).”

 

Read the full article here.

On cross-country:

• Property still beats a pension, say retirement savers – Financial Times
• A Driverless Future Threatens the Laws of Real Estate – Bloomberg
• Yes to Affordable Housing in My Backyard – Project Syndicate

On the US:

• Booming Home Prices Spur Spending on Public Education – NBER
• America’s New Metropolitan Landscape: Pockets Of Dense Construction In A Dormant Suburban Interior – BuildZoom
• Is Rent Growth Finally Slowing? – Harvard Joint Center for Housing Studies
• America’s Other Housing Crisis: Undercrowded Suburbs – The Atlantic
• The Affordable Housing Crisis Is About to Get Worse – New York Times
• Navigating the Turbulent Economic Waters of the 2007 Great Recession and the Crash of the Housing Market – University of South Florida
• The Towers Came Down, and With Them the Promise of Public Housing – New York Times Magazine
• The Impact of TOM on Prices in the US Housing Market – The Journal of Real Estate Finance and Economics
• A Bid to Solve California’s Housing Crisis Could Redraw How Cities Grow – Wired
• Tech Wealth Turns Attention to Affordable Housing in Seattle – Wall Street Journal

On other countries:

• [Canada] Canadian mortgages held by foreigners grow, says housing agency – Reuters
• [Canada] Home Equity Extraction and the Boom-Bust Cycle in Consumption and Residential Investment – Bank of Canada
• [Canada] New CMHC study sheds light on rising house prices – CMHC
• [Canada] Canada’s housing market flirts with disaster – Financial Times
• [China] Beyond homeownership: Housing conditions, housing support and rural migrant urban settlement intentions in China – Cities
• [China] China developers retreat from Hong Kong property market – Financial Times
• [Germany] Demographic Changes and House Prices: A case study of the German Detached Houses – Journal of Regional & Socio-Economic Issues
• [Nigeria] Sub-standard housing and slum clearance in developing countries: A case study of Nigeria – Habitat International
• [Norway] Can monetary policy revive the housing market in a crisis? Evidence from high-resolution data on Norwegian transactions – Journal of Housing Economics
• [South Africa] Drought Dulls Thirst for Some of Africa’s Most Expensive Homes – Bloomberg
• [Sweden] Banks Pile Into Sweden’s Housing Market – Bloomberg
• [Turkey] Determinants of Residential Real Estate Prices in Turkey – European Journal of Business and Social Sciences
• [United Kingdom] UK house prices: Looking far into the past and into the future – VOX
• [United Kingdom] A Day of Reckoning for UK Housing – New Economics Foundation
• [United Kingdom] Sellers accept big discounts on top-end London property – Financial Times

Photo by Aliis Sinisalu

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