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09/24/2018

Comments

Zainab Abiza

When dealing with complex issues relating to development, there is always a number of moving pieces that contribute to the problem. Models are not perfect and don’t always fully capture the problem. Instead, they are based on a number of assumptions that should hold in order for the model to "work". We saw this in the Lewis Two-Sector model which is based on the two main assumptions that surplus labor exists in rural areas while there is full employment in urban areas and that the rate of labor transfer and employment creation in the modern sector is proportional to the rate of modern sector capital accumulation. Although these are both strong assumptions, it doesn't mean that we should discard the model as a whole. Most economic models, despite their flaws, do help us understand complex issues and do have an added value. Therefore, rejecting economic models because they are too simplistic is not the solution. Instead, one should be aware of the assumptions behind it and be able to address its limitations.

Clair Spotts

As many have said before me, this article did a great job of contrasting the distrust of the use of economic models (as opposed to hard science models) with the importance of their use in the field of economics. As someone who is not an economics major, I have always found it very hard to trust models. I can understand their utility in many instances, however, I don’t like the idea of delegating human experience to patterns and predictions that cannot always be properly reflected in models. Nearly every day in class, the answer to whether one cause will lead to one outcome is “it depends.” Humans don’t always follow the most rational path and presenting the behavior of large groups of people in a model is hard. While there is valid use of looking at a graph or other model in order to understand the basics of a situation, so many situations are much more complex. Fultz’s dish-pan can be accepted as a model and not be criticized for its lack of attention to every detail because no one is being overlooked when the earth is represented as flat. On the other hand, when economic models simplify human behavior, and are then taken as fact and adopted without taking into consideration the assumptions being made in the model, people can be harmed. While working in a refugee resettlement organization, I was puzzled to learn that some of our clients would willingly return home to places they had fled. They would give up the possibility of US support and citizenship in favor of a sense of social security in some of the most dangerous places in the world. Rationally, it was the wrong choice, but it was the choice they made, and they had the freedom of being part of a developed country to make it. Models are important, but must be used carefully so that they do not detract from the freedom of those they are representing.

Jordan Watson

This paper is very insightful about the history of development economics while also going into detail about “high development theory” and the role of models in the social sciences. His broad overview of different development theories reinforced what we read from Chapter 3 and discussed during class this week.

When discussing high development theory, Krugman mentions the necessity of the concept of economies of scale at both the producer level and in relation to the size of the market. Individuals will become more productive in the modern sector as long as the market is large enough to compensate for paying higher wages to the individuals that left the traditional sector. Therefore, modernization must be started on a sufficiently large scale to be self-sustaining. While this claim makes perfect sense, I did question the adverse effects that happen in the long run because of diseconomies of scale where firms begin to see an increase in marginal costs when output is increased. This makes me think of the rapid modernization and growth case of China that we bring up consistently in class. In the past couple of decades, China has made major strides in its overall development, which can be partially attributed to its strict limit on the number of people that can migrate from the traditional sector to the modern sector.

Eduardo Corona


I enjoyed reading this article and found it very interesting and well written. Ever since reading Krugman in Professor Goldsmiths Social Issues course, I have enjoyed his writing style and how much of his opinion we get unlike some papers that seem like they are all numbers and no voice.
In terms of the content, something that immediately caught my attention was his Africa map example and how he related it to the field of Economics. At first, I did not know how he was going to tie it in, but after reading more, it seemed to be the perfect anecdote. Another part that stood out was how he mentioned that “Economics, of course, has become vastly more mathematical over time,” which tied in well with our discussion this week about modern day economists using math for the sake of making it seem more intellectually advanced. I then liked how he tied the mathematical argument with some well known development economists and how they have used it to advance their theories. A final aspect of this paper that I would like to point out was his emphasis on the importance of models. A quote that stood out as interesting is the following: “Economic theory is essentially a collection of models. Broad insights that are not expressed in model form may temporarily attract attention and even win converts, but they do not endure unless codified in a reproducible -- and teachable -- form.” I think this is a great point and I liked how he highlighted the importance of models being teachable because it seems like in the end, that is the most important part so that they can be expanded.

Suha Abdulmalek

I find Krugman’s piece very rich and interesting. It was sort of challenging to digest his argument at the beginning as he mentions a number of concepts and theorists that I wasn’t familiar of however this is one of the reasons why I believe his paper was very informative. I also liked how it touched on many of the issues regarding economic development history and theories that were discussed in class.
I have always found economics interesting because it is the social science discipline which uses mathematics in analyzing and forecasting economic phenomena which are directly related to humans’ life at the individual level and global level. However, as an econ student I never actually thought of model construction as a complex process as I usually come across them when learning a certain concept, yet I have always wondered whether the simplifications made in studying a certain economic concept actually provides us with reliable results that can give us useful insights for decision or policy making processes. Krugman’s piece provided me with an answer to my concerns as well as drawing my attention to the importance of economic models. I also liked how The African map analogy explained his argument clearly and made me wonder what if there are different aspects to the development research that are not exploited yet

Harry Shepherd

Paul Krugman brought up some very interesting and thoughtful points throughout his commentary. I really enjoyed and found especially interesting the heavy use of economic models for the development of a nation/economy. While there have been some criticisms on the over-reliance of models in economics, I do believe that generally they provide the simplifications necessary to make goals achievable and sensical. Generally, I believe models give the user a "close enough" estimate towards what would actually happen.

The model Krugman provides give us a simple breakdown of each variable and the assumptions behind it, while also telling us the factors that they must meet for the assumptions to be held valid. Additionally, the model is extremely simple and easy to understand, benefitting all who use it.

I also enjoyed reading Krugman's thoughts on the developments/failures of the development economists. Not only was this paper informative, but it also gave the reader insight to how Krugman thinks. By adding personal anecdotes and commentary upon the general field of Economics, the paper stayed interesting and thought-provoking.

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