As a layman, not an economist, I found Portfolios of the Poor fascinating. It certainly exposed some of my own stereotypes of the world’s poor, but I do have two reservations. First, two of the countries under study (India and Bangladesh) share a number of historical and geographical similarities. I wonder if another Asian country, say Cambodia, might have revealed something else. And, as far as African goes, South Africa is in many ways atypical of most countries south of the Sahara. If Zambia or even Nigeria had been used instead of South Africa, would the conclusions about money management have been the same? Thus, in part I wonder if other countries had been chosen would the “encouraging” conclusions have been the same.
Second, what about those at the very bottom who certainly live from hand-to-month? The day I finished reading Portfolios of the Poor, I read a lengthy article in The Washington Post (“Pakistan’s Kiln Workers Bricked in by Debt,” by Pamela Constable, 3 July 2009), which certainly presents a more horrific picture of people at the bottom. From what I’ve observed in my travels, too many people are stuck at the very bottom.
Still, it’s difficult not to be impressed by Collins, Morduch, Rutherford, and Ruthven and their important work.
“Back in the spring, I hinted that I would be willing to produce a top ten list of must-read books on the international political economy/global political economy (IPE or GPE for those in the know), provided there was sufficient demand.
Judging by the e-mail response, the demand is robust and quite persistent. So I’ve decided… to postpone that list for another month or two.
Because you’re not ready yet.
Let’s face it, if you have read this far in the post, it means you’re either:
* A curious professor ready to minimize this page if anyone walks in;
* A grad student seeking the keys to success in the profession;
* An intense undergraduate student who really wants to study IPE.
(Blog Editor’s Note - he curiously leaves off eager publicist/editor curious to see if any of OUR books make the cut)
Before you are ready to ready the ten books in IPE that you have to read, you should first read these ten books on global economic history.”
So, which Princeton University Press titles made the cut? More after the jump…
Timothy Geithner is having trouble selling his house. The Daily Show calls upon “legendary housing economist” Bob Shiller, author of The Subprime Solution and Animal Spirits for advice… on Geithner’s bathroom tiles. Enjoy the clip below.
by Jessica Pellien | Filed in: Economics | 1:51pm EST
What we need now is a debate about how to break up the Fed—and some of the sprawling financial institutions it supervises—in order to make both the regulator and the regulated more manageable and accountable,” writes Amar Bhide in an opinion piece for the Wall Street Journal.
Read the piece and then click over to Fox Business to watch Amar on today’s Opening Bell talking about the article and the future of the Fed.
“Many fans are in denial, but the reality of professional sport is that money buys success: spend enough and the balance will tip in your favour. Of course, there are no guarantees, but year after year the teams that spend the most on player salaries tend to end up at the top of the league and those that spend the least end up at the bottom. This is not only true for football. The New York Yankees have won baseball’s World Series 26 times (the nearest rival has won it only 10 times) and no one doubts that the financial muscle of the Big Apple lies behind this feat.”
In another realm of the online world, David M. Gordon, reviews the book on The Deipnosophist, remarking after including a quote from the book:
“And with that last quotation, you have the first glimmerings of what elevates this book above others — the economics of sport (and, I dare add, all economics) does not rise from a vacuum, but is of a piece with the prevailing social, spiritual, financial, and moral zeitgeist. Szymanski’s non-elaborated notion places his book with the best art history, for art also is a creature of its time.”
Economists at the World Bank calculate that 2.5 billion people live on $2 a day, but what exactly does that mean? In the developed world, living on so little would be almost unthinkable. For 40 percent of the global population, $2 a day is a reality that must, somehow, be made to work.
In Portfolios of the Poor, Daryl Collins and co-author Jonathan Morduch uncover the surprisingly complex financial lives of the most destitute people.
Riccardo Rebonato, global head of market risk and global head of quantitative research and quantitative analysis at the Royal Bank of Scotland and author of the prescient PLIGHT OF THE FORTUNE TELLERS: Why We Need to Manage Financial Risk Differently, discussed the weaknesses of mathematical finance models and their over reliance by quants as we’ve witnessed during the economic collapse last week on the very popular blog Econtalk. Listen to it here. This lively chat provides an insight into the managing of risk by one of the industry’s top players.
PLIGHT OF THE FORTUNE TELLERS was published in the autumn of 2007, well before the economic downturn.
This morning, Tom Ashbrook, the host of On Point (WBUR) spoke with researchers Stuart Rutherford and Daryl Collins and one of their survey participants Lufefe about what it really means to live on $2 a day. Lufefe, along with hundreds of others, participated in a year-long survey of the poor’s financial practices. Rutherford and Collins, along with Jonathan Morduch and Orlanda Ruthven, gathered meticulous financial diaries that demonstrate not only don’t the poor live hand-to-mouth, but they manage their money well enough to save for life’s big emergencies and celebrations. If you visit WBUR’s site, you can listen to the program and also view a series of photos taken in the Langa Township where Lufefe lives and where much of the research was conducted.
Collins and Rutherford’s research is available in Portfolios of the Poor. Visit the book’s web site here: http://www.portfoliosofthepoor.com/
Image Caption: A participant in the “financial diaries” research in Madhupur, Bangladesh, March 2009. Photo: Robin Saidman /VitalEdgeAid.org
The House that George (and Michael) Built: New capitalism and Subprime Baseball
As we are entering a new era of capitalism, with tighter regulation of bankers and banking, federal oversight of the auto industry and public demand for higher moral standards from our business leaders, will the nation’s monopoly sports franchises start to come under pressure to clean up their act? Public reaction to the new Yankee Stadium is instructive. First, while the Steinbrenners claim that, unlike so many city funded stadiums and arenas, they are picking up the bill themselves, there was been widespread opposition to the deals that allowed them to issue $1 billion tax exempt bonds (entailing a tax subsidy of between $250 and $500 million) and to repay the bonds in lieu of (property) taxes. Moreover, there have been investigations claiming that the stadium was deliberately and misleadingly overvalued in order to make the deal to go through. Second, now the stadium is open, punters are baulking at paying the $2500 price tag attached to the premium seats, attendance figures are weak and there is talk of serious price discounting. Could the mighty Yankees, like a subprime borrower, end up being unable to pay their way?
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Riccardo Rebonato, global head of market risk and global head of quantitative research and quantitative analysis at the Royal Bank of Scotland and author of the prescient 
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