Friday, July 30, 2010

trying to explain the current labor market through a historical lens

Compare this to this and this. And thanks to Memoirs of an Economics Student for the links and conversations!

(By the way, I updated my UMass econ bloggers post once again to include Anastasia -- who, judging from recent posts, is finishing this upcoming year and planning on going to grad school.)

To sum up the current links, which I would call highly indicative of general catastrophe in the field of economics: a lot of debate is going around the blogosphere about the fact that job openings seem to keep increasing while at the same time no one is hiring. Combine this with relatively good profit postings from companies and you have the makings of a quite confusing scenario. The latest reports from the Financial Times on global equity markets are also strong.

Interestingly, Greg Mankiw was one of the first in the blogosphere to take up one this topic (though a bit tangentially), on 16 July. In this thought-provoking post he notes the rise in median duration of unemployment and discusses the effects it might have on inflationary pressures. He then says we should expect to see a lot of research on this in the coming years. This is an important part of the story of the labor market: if the predicted effects of a rising median duration of unemployment are inflationary, and what we're seeing now is precisely the opposite (worries of deflation through lower-than-expected core inflation), well...
Inflation has remained low. The price index for personal consumption expenditures appears to have risen at an annual rate of less than 1 percent in the first half of the year. Although overall inflation has fluctuated, partly reflecting changes in energy prices, by a number of measures underlying inflation has trended down over the past two years. The slack in labor and product markets has damped wage and price pressures, and rapid increases in productivity have further reduced producers' unit labor costs. (Ben Bernanke, Semi-Annual Monetary Policy Report to Congress, 21 July 2010)
As an economic historian, of course my first question is: what kind of theories or historical models do we have out there to compare this situation to? Surely Mankiw's post is only tangentially related to the key concern of Krugman and others, but my suspicions are that they aren't considering enough of these tangents in their own stories.

What a weird situation.

Here is the clincher, the money question in my book: to what extent is the experience we're going through now similar to the GD? Is this structural unemployment or a cause for radical Keynesian intervention? (Or both.) I think it's safe to say that monetary policy is not a central policy question at this point, and as several liberals have pointed out, it's likely the stimulus simply was not big enough to boost AD out of the slump.

When asking historical questions (or really, any scientific question), a popular method to employ is to start off by thinking about what your "ideal data set" might look like. If you had all relevant data available to you, how would you make your argument? If I could employ any data set how would I make the argument that what we're experiencing now is very much like the case of the GD?

I'm going to put that question out there, see if anyone has thoughts after reading more about the current situation (as well as dig up my copy Kindleberger and a few other studies of the GD), and post some ideas early next week.

Thursday, July 29, 2010

bastardized keynes or keynes the ******? (part of an ongoing series)

OK, I've written too much on this blog lately about Keynes to not respond to this very insightful and compelling post by Mark Silverman over at CognitiveFootprint:

I think both Mark and Ewart (the author of the main article Mark discusses) is not really getting Keynes. I'll accept that Keynes promotes spending over saving, and this is at least partially a question of morality, given the quotes from Keynes that both Mark and the author cites. However, I'm not convinced that this is a good or even relevant critique of Keynes' General Theory (hereafter GT) because it starts from his conclusions and policy proposals instead of addressing the whole premise of his arguments -- the big reasons why he wrote the book.

The essence of my argument is this: you're focusing way too much on Keynes' views of the product market. You detach the notion of "business investment" or "spending" more generally from the labor market. Keynes' whole goal in the GT was to set out to address the problem of unemployment and what we get at the end is a recipe book for implementing full employment.

In chapter 2 of the GT Keynes is quite clear that his is a critique of labor markets. He criticizes the idea that the tradeoff between labor and leisure can adjust freely in a general situation of unemployment where savings does not equal investment, arguing that workers will not accept a fall in money wages in order to produce a market clearing in which full employment (and thus the classical model) will hold. This is the "second classical postulate", the one of which he seeks to break and then examine the theoretical implications of doing so.
But there is a more fundamental objection. The second postulate flows from the idea that the real wages of labour depend on the wage bargains which labour makes with the entrepreneurs. It is admitted, of course, that the bargains are actually made in terms of money, and even that the real wages acceptable to labour are not altogether independent of what the corresponding money-wage happens to be. Nevertheless it is the money-wage thus arrived at which is held to determine the real wage. Thus the classical theory assumes that it is always open to labour to reduce its real wage by accepting a reduction in its money-wage. The postulate that there is a tendency for the real wage to come to equality with the marginal disutility of labour clearly presumes that labour itself is in a position to decide the real wage for which it works, though not the quantity of employment at this wage.

The traditional theory maintains, in short, that the wage bargains between the entrepreneurs and the workers determine the real wage...
There are two main things I want you to notice about this quote. First, observe the overall emphasis on labor. This is not going to be a "theory of spending", no matter how much you want to twist the logic -- this is a theory about the determinants of employment, interest, and money (with a particular emphasis on employment). Second, note the underlying acceptance of the neoclassical model! He's using their terms! This is not meant to displace anything big! Check out all of the book reviews by economists such as Leontief and Keynes' responses -- it is remarkable how easily this can be viewed in the orthodox framework. Of course, as I've argued before, this fact makes the GT no less profound, but I think it's important to understand this in the history of economic thought.

From the premise laid out in chapter 2, we begin to explore his thought process -- his analysis of consumption (brief and not that interesting), of investment and his exploration of the relationship between interest rates and the marginal efficiency of capital (not new!). We get to the discussion of financial markets and expectations, and we begin to approach the core punchlines of the theory -- how investment drives income and how it all relates back to the problem of jobs in the economy. For example, why were corporate profits rising in the mid-1930s when unemployment was not getting much better? We can appreciate these types of stylized facts only once we understand the implications of Keynes' argument for understanding both investment AND labor markets.

This post is already getting quite long and I don't have too much more to say. But, I'd like to take up some of Josh's points regarding tracking this morality view of spending into his other works.

While I already included this quote from "Economic Possibilities" in a previous post I'm posting it again because it identifies very clearly Keynes' fundamental acceptance of the Judaeo-Christian, classical model of the economy:
I feel sure that with a little more experience we shall use the new-found bounty of nature [once we are at the stage of technology at which we can solve the 'economic problem'] quite differently from the way in which the rich use it to-day, and will map out for ourselves a plan of life quite otherwise than theirs. For many ages to come the old Adam will be so strong in us that everybody will need to do some work if he is to be contented.
In other words, Keynes still fundamentally accepts this labor-leisure tradeoff which is at the core of a Judaeo-Christian ethical model of the economy.

I conclude with one more quote on work to show what alternative views ARE out there. As David Spencer notes in a recent paper in Labor History:
People were required to work in order to meet their basic material needs but they also benefited from the challenge and difficulty of work itself. Marx suggested that human beings were drawn to work as a means to realise their 'species being' and he considered the participation in work as the basis for a contented and fulfilled life. ("The 'work as bad' thesis in economics: origins, evolution, and challenges," Labor History Vol. 50, No.1 [Feb. 2009]: pg. 48)
This is clearly not how Keynes sees labor.

Monday, July 26, 2010

living vicariously through mark frauenfelder

Mark Frauenfelder, one of the editors of the blog of all things quirky, BoingBoing, recently went on vacation. Apparently his vacation is spanning continents and his latest landing spot was Tokyo. In a post earlier today he documents his trip to the Studio Ghibli museum which is apparently set out in the suburbs and you have to take a train and then a bus to get there. Being a huge fan of mostly the movies Miyazaki directs for SG, as well as a few others, I loved looking through all the pictures he took.

The post is here. Enjoy! By the way, I'm not sure but I think the cuneiform he mentions is from Castle in the Sky.

The latest SG film was released on 17 July in Japan, titled Borrower Arrietty. It seems to be a hit in Japan, however, there is no scheduled U.S. release. The last SG movie, Ponyo, took a full year to make it to U.S. shores.

Here is a small piece I did on Miyazaki last October which includes links to an interview with him and an article with really interesting facts about his political background:

Sunday, July 25, 2010

umass econ bloggers

This is certainly exciting news.

With a new entry into the blogosphere, UMass economics now has (to my knowledge) 9 10 independent bloggers writing about various topics. Definitely check these out.

A few of the Chinese students in our department have started up a collectively-run blog on politics and economics (in Chinese!), which you can find here:

Mark Silverman, philosophy and economics:

Tomas Rotta, Marxism for the 21st century (in Portugese!):

Anastasia, interests in behavioral economics:

Amit Basole, Indian political economy and social movements:

James Miehls, Marxian theory, post-modernism and baseball:

Ian Seda, part of Los Expatriados, a group writing on contemporary political economy in Puerto Rico:

Josh Mason, Macro and international economics:

Joe Rebello, politics, political economy and basketball:

Harry Konstantinidis, Greek basketball and politics, art, political economy:

UPDATE: Thanks to Tomas for reminding me that he also has a blog. If I'm missing anyone else, please leave a comment!

Thursday, July 15, 2010

how does economic inequality induce political economic instability? assorted links

Raghuram Rajan breaks down some of the channels through which these two concepts are related, including some history, in this Project Syndicate piece.

A more nuanced view with more interesting implications (and great accompanying style!) by David Harvey is here.

Other Marxist interpretations with an emphasis on inequality are those of Rick Wolff and David Kotz.

And actually, I had a student in my American Economic History class who wrote an amazing paper on how inequality is related to the Great Crash of 1929. I think he reads this blog too -- Rob V., feel free to offer comments on your view of this! I believe he used Kindleberger, an article by Eugene White on the Crash, and possibly even Lichtenstein's State of the Union.

Tuesday, July 13, 2010

keynes our lord and master

I thought a little more about how I would fit my discussion of the causes and consequences of unemployment into a nice clean argument and framework for students of macroeconomics. In the process I realized how great the beast I had summoned really is. Because it turns out that you need a full appreciation for how investment ties into the economy to really understand the interplay between politics and investment (political conditions influence investment which influence government policies which influence political conditions...). And then to tie it all back to unemployment... I certainly need to think about these ideas some more.

Nevertheless, this blog is making a clean break from tradition with these posts. Normally I've presented ideas which have been long in the making and had a great deal of thought behind them. But I get the feeling that these posts dealing with teaching over the course of the next month are going to be significantly informal, representing works in progress undoubtedly containing a few logical gaps. Hopefully it makes reading them more interesting! And as always, I welcome criticism and comments.

So, here's one of these "crazy" posts, for sure.

This post is related to teaching but it is once again highly experimental. I started to rethink unemployment, focusing simply on the idea of unemployment, how social perceptions of it have changed over time, and what it might all mean for understanding Keynes' views. I started thinking about how society has treated the unemployed, past and present. This thinking led me back to Keyssar's book, which is why I posted a quote from it earlier. And when I started thinking about the history I realized a few things.

First, I realized that society has always been concerned with the unemployed in some way or another to an important degree. Second, Keynes' model has much stronger implications for the role of state policies than almost anyone realizes (including obviously the New Keynesians, but even some of the "truer" Keynesians such as Krugman). The ultimate implications of this thesis are huge. Keynes' program for investment-led stabilization, fueled by a desire to solve the "unemployment problem," are a modern example feudalism in which the state becomes something like a feudal lord and the workers serve the role of peasants. In this (twentieth century!) model, the state becomes the direct appropriator of the profits from investment (through the planned system) in order to maintain as close to full employment as possible.

This post is a sketch of the two-pronged argument made above, which I hope to elaborate on very soon. The end goal is to arrive at a synthesis of unemployment with Keynes' views on investment by constructing some powerful continuities between the two concepts, driven by a history of social concerns for the unemployed.

Our story, interestingly, begins in fourteenth century England.

After the Black Death had pretty much run its course through England, the Statute of Artificers was passed. Reacting to the drastic cut in labor supply and the consequences which come with it (such as a better position for laborers to bargain for higher wages), the statute was meant to do two things. First, keep every able-bodied person working -- either for wages, serving under a lord, or serving as an apprentice in some trade. Actually it was considered a crime if you weren't working. Second, the statute placed a ceiling on wages and regulated several other terms of the labor contract. The statute called for regulation of wages by allowing town governments to determine "fair values" (as they were also doing for food such as bread and other goods at the local market).

For me, this is really the beginning of the modern story of the relationship between the state and unemployment. Why? Because the American colonies were not much different -- settlers imported many institutions from Britain, including the Statute of Artificers (and later, in the 16th century, the Statute of Laborers). Towns regulated wages and enforced the assize on bread, coerced people to work when needed, and took care of their poor through either workhouses or some other local welfare system.

And obviously the Revolution would change some of these feudal institutions, but not all of them. The change was far from a radical shift, contrary to what some histories of the Revolution may suggest. Surely a republican society was indeed no place for shackled workers and regulated wages. And some of these institutions slowly began to fade away, particular.y unfree forms of labor in the North, as the ideological contradictions with the South grew. But the simple fact that the North was comparing their free (I would say, "relatively free) labor markets with the South should set off some bells and whistles. For example, controls on unemployment stuck pretty well. Overseers of the Poor in local towns were still prevalent, housing the poor and handling apprenticeships when needed (and compelled by statute). Workhouses, another British-inspired institutions, were quite prevalent in early America.

Poor relief took on a new, private character as we moved further into the nineteenth century. At the same time (and arguably, as a result), workers increasingly looked toward institutions on the state (and later federal) level for aid, and this included aid for unemployment. As Keyssar argues in Out of Work, a variety of forces acting on labor markets particularly after the Civil War made unemployment a more acute problem, leading to crime and other social problems. In turn, unemployment itself was considered a crime just like it had been five hundred years ago through various tramping laws passed in the 1870s and 1880s. Such a contradictory state of policy, where the state had a hand in both punishing the unemployed and (marginally) helping workers out through workplace investigations and reform!

And then in the early twentieth century we have the pamphlet which is mentioned in the quote from my previous post, setting out an expansive program for state policy in addressing unemployment. So there we are, early 20th century and we are faced with how to solve issues of unemployment. In several ways, as I noted above, things sound quite familiar. But Keynes, I would argue, added a remarkable twist.

However, this post is already too long. The second half (really only two parts I promise) coming soon! But to sum up so far and bring back my main argument:

The Keynesian welfare state, specifically in its state-led investment policies, isn't much different from the landlords of 14th century Britain who kept their serfs bound to the land and working, appropriating any surplus value directly from the workers without markets in between to intervene and reallocate. But just because it's an old institution does not mean it is insignificant or even wrong. But viewing the intersection of unemployment policy and investment theory, we can see the true scale of Keynes' plans.

the moral and economic imperative of full employment

From Alex Keyssar, Out of Work (Cambridge University Press, 1986).
To preserve American capitalism, enhance the well-being of workers, and restore the health of the social and political order, the men and women who belonged to the AALL [American Association for Labor Legislation] and the Massachusetts Committee on Unemployment advocated a multipronged approach to the problem of joblessness. They urged both that steps be taken to prevent unemployment from occurring and that the state assume responsibility for aiding and subsidizing those workers who did lose their jobs. John B. Andrews's Practical Program for the Prevention of Unemployment in America, an extremely influential manifesto first published in 1914, called for public employment exchanges, the expansion of public works projects during depressions, alterations in the productive rhythms of seasonal industries, and state-sponsored unemployment insurance. Andrews's Practical Program, which was the intellectual starting point for reform agitation in Massachusetts and elsewhere, also advocated a reduction in the hours of labor, an immigration policy sensitive to the dangers of an oversupply of labor, the stimulation of an agricultural revival in the United States, the development of industrial training programs, and the prohibition of industrial employment for boys and girls under the age of sixteen. By acting on most or all of these fronts, reformers believed that state and federal authorities could dramatically reduce the incidence and impact of unemployment.
EDIT: I should have given some reasons why I posted this. First, it shows that Keynes' policy prescriptions were not contingent on the forces occurring during the Great Depression. Second, it identifies very nicely the conservative character of full employment policies. Third, it demonstrates nicely why and how the state attempted to interact with labor markets prior to the New Deal. Finally, does it not prove how old some of these ideas are? Shouldn't we be searching for a new set of policies that might actually change workers' positions to really alleviate them of the ails of unemployment or other system-related problems?

Monday, July 12, 2010


This is certainly the most impressively abstract and challenging Mario level I've ever played. From Super Mario Galaxy 2. Enjoy!:

Thursday, July 8, 2010

recipe book for cooking up a delicious anti-mankiw, chapter on unemployment

I decided to use my teaching job this summer to catch up on some Anti-Mankiw- related ideas. So you can consider these posts to be part-notes part-critique and part-solution as I group some of these ideas into a workable form.

Unemployment: definition, causes, and consequences

What really amazes me about introductory textbooks in economics is their simultaneous acceptance and rejection of politics as having anything to do with the variables in question. For example, when discussing unemployment dynamics, Krugman addresses one of the most compelling questions in economics with the answer that, well, it depends on "the nature of labor markets" (2e, pg. 206). Mankiw is not much different (4e, pg. 622 where the causes of unemployment are almost the same as the ones Krugman advances, though Krugman is less thorough).
The compelling question cited above is simply put in Bowles' Understanding Capitalism: "[o]ne of the hardest things to understand about our economy is the fact that there are often (a) factories lying idle while at the same time (b) a significant number of people are looking for work, and (c) many human needs are not being met" (403).
I want you to seriously think about that for a minute before reading further. Think hard. How would you answer -- is it a natural trilemma? Is there any way to change it? Is it necessarily a bad thing? Leave comments with your ideas!

I don't feel like getting into all the details here, but it's clear that for Krugman and others, it's just about "the nature of labor markets" -- let economists analyze the market forces and how they might be channeled toward more optimal ends.

Such a response is the knee-jerk, fake, and uncritical reaction of one whose worldview is based on a highly simplified and simply wrong model of the labor market.

I'm not sure who is worse on this issue either -- Krugman or Mankiw. Krugman passively presents the "consensus among most economists" (it is a common theme in his text) that collective bargaining and minimum wage legislation cause structural unemployment and therefore interfere with a natural market order (2e, pg. 210). Mankiw at least acknowledges other views, but, for example, refers to the theory of the reserve army as an "old Marxist idea" (4e, pg. 633). Right -- as though the vision of a perfect market order "disturbed" by rigidities such as minimum wage laws were not old.

So, in presenting unemployment and inflation as the two "great evils" of macroeconomics (199), Krugman seems to be accepting some sick variant of the new Keynesian synthesis of the 70s and 80s, forgetting some crucial points along the way: first, macro theory arguably began not with treating the "evils" (???) of unemployment and inflation but rather with Keynes, who in the 1930s focused on how variables such as investment dynamics influence the labor market; second, macro policy founded on the "dual mandate" of price and growth stability is far from a politically neutral category of political economy (Krugman has nice separate pictures of Reagan and Clinton in his unemployment chapter! cute); third, and perhaps my biggest problem with this treatment -- analyzing the labor market as though it were in some kind of temporary disequilibrium.

I hope I don't need to say anything else about the first point (I mean, is this really how history of thought ought to be treated in an intro text? At least get the historical sequence straight if you're going to be superficial). The second point is very relevant given the historical origins of the Federal Reserve as well as the ownership of said institution by a collection of private banks. And, let's not forget, among many other examples, Greenspan's The Age of Turbulence where we get to see in painstaking detail the level of intimacy which characterized his relationship with free market thinkers and ideas during his ten-plus year tenure as Chairman. The third point is addressed by Keynes in Chapter 2 of his General Theory -- that is, it's the whole reason he wrote his book! He argues that breaking the classical postulate concerning the equilibrium character of labor markets is similar to breaking the parallel postulate in Euclidean geometry. Everything explodes. See my own post on this here.

In summary, implicit in both Krugman and Mankiw's first treatment of unemployment in their textbooks is an underlying model which completely separates labor market issues with other factors in the economy. You don't have a job because of high search costs (frictional unemployment) or your skills are relatively high in demand at this point (structural unemployment). Linkages with real macroeconomic dynamics and issues or politics is eschewed.

Proposed alternative discussion

Because no one likes a summary critique without a positive turn on things, it remains to show how these ideas might be collected into a better treatment of the causes and consequences of unemployment. For the moment, let me push aside the -hate part of my love-hate relationship with Keynes and accept the fact that he as well as Marx both made valuable contributions to our study of investment behavior and aggregate demand, and how both of these variables influence unemployment.

The conditions of the business investment climate include class power, future viability of the economy (made almost completely ambiguous by uncertainty), taxes, and pro- or anti-labor governments. The conditions of political dynamics, on the other hand, are based on investment decisions (see my post on the investment theory of politics here) as well as some autonomous factors.

These two spheres of activity -- politics and investment -- feed each other dialectically in an advanced capitalist economy. Both are central for a story of strong economic growth as well as for an understanding of the politics of the business cycle -- bailouts and so on.

These ideas are not hard to swallow. But it does take some time to work out the dynamics because they are certainly complicated. And I really mean they are governed by dialectics. But it should be fun! There are a lot of contemporary connections to make, and as long as it all relates back to how business and politics feed off of each other, I think the "big picture" can be advanced easily.

History is also important here. Yeah yeah... I know I'm always talking about it! But I think it's important to see how the relationship between the state and investors started, it gives students a good sense of how it all started or at least matured. A perfect point of introducing the historical origins of these dialectics is encapsulated in some big-time government-capital moves of the twentieth century: the creation of the Fed and of course, the creation or founding of the Welfare State during the Great Depression. Seeing the politics of these institutions and the original motivations for their invention allows the student to see the ideas of the "great evils" as historically contingent and therefore politically-motivated and not permanent. (By the way, I think using the term "evil" in these contexts, as some economists are wont to do, is disgustingly non-rigorous and politically deaf.)

So, there you have a general outline. If your students want to learn about unemployment, start with the definitions, point out some curious aspects of these definitions such as their reference to equilibrium and complete ignorance of some of the core issues about why unemployment occurs, and then explore how unemployment is influenced, and in turn influences, the political dynamics of investment. Introduce some history to show them that these ideas are contingent on a specific constellation of the political forces -- that way they understand the political non-neutrality of the economic policies as well as some lessons about how they arose in the first place. In this way, they gain an understanding of unemployment that is also informed by the historical, social, and political dimensions of the issue.

Aside from that, the other topics of the unemployment chapters in Krugman and Mankiw definitely need to be addressed, such as job search, collective bargaining, and efficiency wages. But there is no reason why these subjects couldn't be covered in the context of the above dialectical relationship which I outlined. It would just take some work to reframe the issues. For example, there are some great stories connected to Ford's 5$ day and Bismark's welfare model. Use them! (Or email me, and I can suggest some ways to use them.)

Tuesday, July 6, 2010

final fantasy 13 - first impressions: on the razor's edge

This is a bit late for "first impressions" since I'm pretty far through the game already. Let me begin with a comparison to another game in the series which enjoys a more significant consensus view about its quality. I am hoping that this will show that FF 13 is truly on a razor's edge.

Final Fantasy (FF) 7 deserves the praise. Most of the criticism which came years after it was released is unwarranted -- it can be seen as a byproduct of the game's extreme success and popularity as truly one of the best games ever. FF 13, on the other hand, deserves both praise and criticism. It is a heavily experimental game which walks fine lines on most of the major elements in a game: gameplay, storyline, and music.

FF 7 was certainly new but it didn't challenge the major tenets of the series: Nobuo Uematsu continued as the main composer of its music after the excellent FF 6 soundtrack; the gameplay was still largely based on levelling up and turn-based battle strategies; and in the end it was all about becoming as powerful as possible and getting the best weapons through sidequests. There were novel elements, but they were mostly due to the drastic change in technology from the SNES to the PS -- the story was certainly more cinematic and other elements were simply heightened given the better graphics and more memory the PS offered.

FF 13 is quite different. Uematsu is no longer the main composer, and it shows. The Chocobo theme, for example, is now played with lyrics. (?!). Music repeats itself in areas quite often early in the game and therefore fails to give each environment a unique feeling. There are some good songs which draw on experimental jazz and electronica, but I wish there were more classical pieces -- especially for some of the grander environments (I can't say exactly which environments since some would contain spoilers for the plot).

The gameplay is completely oriented around the notion of time. This makes battles extremely fast-paced. That sounds strange so let me explain. In previous FF's, there have been MP costs for magic, as well as other issues to take into consideration such as enemy's susceptibilities to various magics or status effects. These were the central aspects of the strategy. In FF 13, everything comes down to how much time it costs vs. how much time you have. Magic doesn't cost MP, it costs ATB bars. Over time your ATB fills up, and according to how much it has filled up, you can cast this or that spell. Haste is one of the very last spells you learn, which contributes perfectly to my thesis about the centrality of time.

Enemy encounters, in turn, are all about time. It's not simply about figuring out some enemy's weakness. It's about figuring it out and then pounding it with the appropriate magic in order to reach the point of stagger as quickly as possible. At the point of stagger, enemy defense lowers and you are able to, for a brief period, relentlessly assault your foe to cause massive damage. Effectively utilizing stagger can mean the difference between victory and defeat even on regular enemy encounters, and is certainly a central part of taking down the bosses.

Grinding means nothing to approximately 3/4's of this game. This is a huge difference from previous games. Love it or hate it, I at least would have liked some more choice, since the linearity of the game pushes you constantly forward leaving you little freedom to grind or build even if you wanted to.

The story is excellent but yes, as I just mentioned above, it is very linear. In order to make it feel less linear, for the first 3/4's of the game you switch different parties over the course of each chapter. Thus, the gamer is able to gain a sense of different personal conflicts among the members of the party. When areas finally open up later in the game, it's an extreme opposite of the previous chapters.

And so on. The game is intense but it pulls the gamer in such extremes that it is hard to develop a solid love or hatred for the game. And thus I won't be able to give it full points for a full review (which this has basically become!). But the game is definitely a must-buy and most fans will find something in it which they like. I for example really really enjoy the battle system and the story. I honestly feel they are some of the deepest the series has offered. At the same time, I can't get over the linearity of the plot and levels, as well as the horrible music.

Since I've basically given a full review here, I will confine later comments to more discussion of the battle system since it impressed me so much. For the story, you're just going to have to find out for yourself! But I certainly welcome emails if you want to discuss anything, as I think the connections this game makes with religion are some of the most powerful we've seen in an FF.

Sunday, July 4, 2010

what do you mean by capitalism?

A fellow grad student sent me an email after reading my most recent post, asking me a question about what I mean by tracing the evolution of capitalism.

For better or worse (honestly I can't decide which), there have been many debates over the necessary and sufficient conditions for capitalism. One of these debates occurred in the context of the moral economy debates in U.S. history, something I teach in an upper level course on American Economic History (Econ 362 at UMass). The central question of those debates is, when do we see the widespread growth of capitalist institutions in U.S. history?

One of the most compelling and interesting studies in the moral economy debate is Winifred Rothenberg's From Market-Places to a Market Economy which, as the title suggests, is an analysis of markets and market behavior. Prior to 1750, markets certainly existed, but they were generally confined to the local town and the prices and wages were set by local institutions. But as consumer mobility (as well as a host of other factors) increased after 1750, barriers between the local towns began to break down, leading market prices in each town to converge to one another -- leading eventually to an approximately equal price across all markets and towns. Thus Rothenberg argues convincingly that what we see in the century between 1750 and 1850 is the gradual breakdown of traditional institutions which hindered market integration. This is strong evidence for market integration and, Rothenberg argues, an empirical sign for the rise of a market society (signaled here by price convergence -- a hypothesis originally put forward by nineteenth century British economist Alfred Marshall).

We can extend this thought a bit further. The convergence of market prices is a strong sign that what we have between 1750-1850 is the rise of the liberal-minded citizen fully engaged in economic relations and quick to cast off his or her mercantile roots. It is a sign that government began to play less and less a role in the economy. The true radicalism of the Revolution, as famed historian of the period Gordon Wood has argued, was precisely this explosion of laissez-faire capitalist society and democratic institutions, such as markets, the press, and religion.

Sounds pretty convincing, right? In this model capitalism is shown to be an outgrowth of a liberal democratic population. But not so fast. As Wood himself has noted, capitalism does not necessarily equate with a market society. But whatever capitalism might mean, Wood points out, it's evident from studies such as Rothenberg's that it was a democratic process. Hm. An alternative view is argued by Marx, who stresses the social relations that change in capitalism. That is, it's not so much about market integration as about people's roles in the economy which change due to that market integration.

This was the approach more or less taken by Michael Merrill in the late 70s, and others in the 80s, who sought to show the importance of social relations in the story of the rise of capitalism. By searching deeply in the historical records for qualitative evidence (instead of simply focusing on quantitative data, as Rothenberg did), these historians partly argued that not only were social relations much slower to change (and even the change itself was quite uneven), but the process was not a natural "smoothing out" of the relevant market rigidities.

This latter observation is particularly important and, I would say, the main contribution of the leftists to this debate. (Even if the debate itself is debatably misdirected and unsubstantial, which I tend to believe.) The integration of market society is pretty well-documented in Rothenberg's amazing analysis of the data. But the leftists win in the end for showing that the process is not ahistorical.

And here, in short, we arrive at my approach. I am interested in the rise of the factory as a new system of production. That, for me, is what capitalism is all about. I want to know how contracts changed (or stayed the same) as a result of the breakdown of the traditional master-apprentice relationship, or even the small-manufacturer relationships more characteristic of some industries such as textiles. I am interested in the legal aspects of the evolution of private ownership of the means of production, and their economic implications.

And I can tell you one thing: it was not natural!

Friday, July 2, 2010

reflections on research, part one of an ongoing series

Two weeks ago I found myself face-to-face with theory in the most direct sense. It was a beautiful and disgusting experience. I finally realized that what I knew about capitalism in the modern world was not sufficient for understanding the world. Because to understand the world you need to know how we got here. Ideas that had resonated with me for months, years, were reduced to the faintest glimmer when observed under the scope of history. And yet -- at the same time -- those ideas gained a new weight of truth when reconsidered and adjusted according to experience.

This is a story of dismay, discovery, and despair. It is a story of realizing that a key idea lies in a story personally uncovered years ago, and that what I'd been reading all along and never fully comprehending is in fact what I had agreed with and found most complex and interesting from the beginning. In short, it's a story about research.

I should have taken myself more seriously months ago when I called for (yes, here on this very blog!) an evolutionary model of the state and capitalist society. But I suppressed these ideas when I began to think about the American Revolution as a bourgeois revolution -- the story of one set of elites replacing another, legitimated by a new economic order founded on the capitalist mode of production.

But in the end, it is the evolutionary model which is key, because to understand the state in modern capitalist society one must explain the origins of the key concepts -- legitimization of class relations, state suppression of capital-labor conflict, and other key ideas of the modern theory. These concepts simply did not materialize out of the bourgeois notions of economy manifested from the Revolution. So, partly what my research is focused on is searching for the origins of modern state institutions in a time when such institutions did not exist. This requires explaining why they didn't exist, as well as what forms bureaucracy took in the intervening period between (arguably) 1776 and the 1850s.

Nevertheless, as I'm sure you can tell, such questions require looking far outside what the economist normally concerns her or himself with. And then to translate it all back into economic implications -- these were some of the biggest ideological challenges I faced.

Never did I even think of Barrington Moore's thesis which claimed that the true bourgeois revolution was the Civil War. I was caught up in showing how, during the early Republic period, the state had spurred a nascent capitalist order into becoming, on the eve of the Civil War, a volatile and viscious beast, an enemy of the people. I rejected all individualist-motivated scholarly case studies of the evils of democratic capitalism. Democracy in America? Surely these were bourgeois notions that defined a "freedom to trade" (as I believe Castro put it) and not much else. Democracy had little political meaning to the people of the Revolution. Supposedly.

I will write more in the coming weeks about these ideas (though of course I will not disclose all of my secrets), but let me just leave you with this: it is a complex yet highly intriguing story which requires significantly rethinking the place of the state in capitalism.