Thursday, April 26, 2007

New Economist Blog

Dani Rodrik has a new blog. You know it's going to be a good one when there's an entire category for blogposts titled "Economists' blindspots"

Speaking of which, he has some interesting thoughts along those lines today:
The [previous] thought experiment clarifies, I think, why the archetypal man on the street reacts differently to trade-induced changes in distribution than to technology-induced changes (i.e., to technological progress). Both increase the size of the economic pie, while often causing large income transfers. But a redistribution that takes place because home firms are undercut by competitors who employ deplorable labor practices, use production methods that are harmful to the environment, or enjoy government support is procedurally different than one that takes place because an innovator has come up with a better product through hard work or ingenuity. Trade and technological progress can have very different implications for procedural fairness. This is a point that most people instinctively grasp, but economists often miss.
Thought-provoking stuff.

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