Exceptional People

An interesting-looking new book has arrived, Exceptional People: How Migration Shaped Our World and Will Define Our Future by Ian Goldin, Geoffrey Cameron and Meera Balarajan. One of the 'puzzles' of economics is why, if free trade in goods and free movement of capital are seen as positive sum phenomena, the free movement of people should be seen as an exception. Yet 'economic migration' is increasingly seen as a problem, rather than an improvement.

The book takes a very long perspective on migration, describing their recurrence since pre-history, and argues that the current wave of movement in this era of globalization is another of those periodic large scale population shifts. Its conclusion appears to be that this is clearly a Good Thing as the main engine of the circulation of ideas and technology. Moreover, the tide cannot be turned but should instead be managed within an international framework. It also looks at some of the problems arising from the current mish-mash of policies and the exploitation of vulnerable people, and also at the benefits of 'brain circulation'. I'll read it with interest. My own experience as a member of the UK's Migration Advisory Committee (whose remit is to provide the economic evidence base to inform government policy decisions) is that a true general equilibrium assessment of migration is difficult indeed.

By chance, as the book arrived, so did an email offering a special collection of free articles about migration from Wiley-Blackwell journals. Let me pick out as most relevant here The Growth and Welfare Effects of World Migration and Emigration in the Long Run: Evidence from Two Global Centuries, the Hatton/Williamson survey article.

The Enlightened Economist will be on holiday for the next few days.

Innovation in publishing

Digital technologies are transforming publishing before our eyes, and I for one find the innovation exciting. The headline-grabber is the growth in e-books – bigger sales than for physical books in the US, thanks to the Kindle/iPad phenomenon. Tyler Cowen's The Great Stagnation became a bestseller although available only as an e-book (which is why I've never quite got round to reading it, although I bought it). Established publishers are becoming increasingly creative in their use of digital technologies, including intelligent blogs to build and engage with the community of readers.

But there is lots more innovation going on. This morning I sat down to note the launch of Unbound, a new site aiming to crowd-finance writing and publishing projects. It's the brainchild of John Mitchison, co-creator of QI.

A book just sent to me by a friend – J.B.Priestley's Delight – reminded me that the upsurge in new small publishing houses (it's published by Great Northern Books) is due to the reduced costs of entering the market thanks to on-demand printing and the scope for smaller print runs and much reduced stock levels, not to mention the direct access to customers via the web. In past posts on this blog I've written about the economics of this type of entry, for example in the case of the London Publishing Partnership. The same economics make self-publication more viable than used to be the case – John Kay has published a number of his own books, with great success, for example.

There's the open publishing movement – Open Book Publishers and Bloomsbury Academic have featured on this blog, and there are more and more joining their ranks. The usual pattern is that online versions are free and print-on-demand physical copies must be paid for. One variant was the conventionally published The Public Domain by James Boyle, which was nevertheless free as a download.

More and more authors are using websites as supplements to their books. A terrific recent example is Poor Economics, whose authors Abhijit Banerjee and Esther Duflo have posted photos, data and powerpoints for teachers online. There are physical innovations in books too. Recently I wrote about the impending arrival of dwarsliggers in the UK.

All in all, it's a heartwarming landscape of technology-enabled innovation and competition. Although the publishing industry is fairly concentrated and with – notably in the academic journals segment – thickets of anti-competitive and anti-intellectual practice, it seems so far to be avoiding the huge mistakes made by the recording industry in responding to the digital challenge. It's great news for readers.

China's Factory Girls – and what they tell us about China's future

Ahead of my first ever trip to Beijing next month, I'm trying to catch up on some recent books about China and just finished Leslie Chang's excellent Factory Girls: Voices from the Heart of Modern China. It's the best kind of reportage. Chang, a reporter for the Wall Street Journal, spent months living in Dongguan talking to the young women flooding out of the countryside for the economic opportunity and personal freedom offered by even the most dismal jobs in the city. She meets many and becomes close friends with two whose lives – along with Chang's own family history of exile from China – form the main narratives of the book. The first half of the book covers life in Dongguan. The second turns to visits to the countryside from which the current generation is escaping.

Each personal story is gripping in their own right, and a summary wouldn't do them justice. The personal also casts light on the changes occurring in Chinese society as a whole. One of the main dynamics is the way the struggle to escape from the tradition of maintaining harmony with others above all else, and certainly above individual choices. Lying to get a better job, cheating, taking and offering bribes – none of these things causes the people Chang talks to any moral qualms – but they can be made to feel guilty about diverging from the group.

There are also loads of other interesting insights. That China's massive cities don't have big shantytowns – in contrast to India or Brazil – because of the strong links migrant works retain to the family farm. If all goes wrong in the city, they move home. That traditional Chinese culture has a reverence for learning (albeit a static and often rote kind) and so one facet of the brutality of the Cultural Revolution was that schools and colleges were the focus of humiliation and torment. That there is a gender divide being created by mass migration to cities, with young women's expectations for themselves running far ahead of young men's expectations of what a wife will be like. I was strongly reminded of George Gissing's marvellous (and under-rated) novel of women's emancipation through the tumult in late 19th century England, The Whirlpool.

Above all, though, that this extraordinary social and economic phenomenon in China can no more be unravelled than a new down duvet can be stuffed back into its shrink-wrap packaging. I hadn't really appreciated the scale of the movement, the biggest human migration in recorded history. Factory Girls has certainly whetted my appetite to read more. I've lined up some of the books recommended by The Browser, but other recommendations gratefully received.

What's worst about being in the 'squeezed middle'?

Yesterday saw the publication of a first report, Growth Without Gain, by the Resolution Foundation's Commission on Living Standards. The Foundation focuses its efforts on people on low to middle incomes rather than the very poor – the group described as the 'squeezed middle'. The report is a first step towards understanding the economic circumstances of households in these low to middle deciles of the income distribution, and will be followed by more detailed research and interviews with families in this category, with a final report next year.

I took part in a fascinating panel discussion of the report yesterday with the Commission's secretary, James Plunkett, LSE economist Steve Machin, and author and guru Will Hutton (I believe the vodcast will be posted here in due course). The debate centred mainly on the labour market trends that probably explain the pressure on living standards – the higher return to high academic attainment and the hollowing out of middling jobs, due to technical change and globalisation, and the failure of education and training to match the changes in labour demand.

However, one chapter of the report to attract my attention was the differential impact of inflation on this group of households. The report looks at inflation in different categories and the share of spending different types of household incur in each category. What's more, in a time of inflation, these groups with little labour market bargaining power never manage to keep their wages growing in line with prices. This is something I know about from experience, having grown up in the 1970s when UK inflation reached around 27%; we went short of some things, and my mother used to hoard foodstuffs such as sugar and tea because they would be much dearer later.

Gavin Kelly, the Resolution Foundation's chief executive, noted that in the interviews with families they've started conducting, people spontaneously mention the effect of rising prices on their standard of living, not the effect of tax and benefit changes. UK inflation is already too high and there is no sign that either the Bank of England or the Treasury is really taking it seriously yet. Although the current 4.5% is well below 1970s rates, and one should not exaggerate the current situation, the authorities should remember that inflation is socially corrosive – and that the measure of inflation expectations they track has climbed from 3.3% in February 2010 to 4.4% in February 2011.

Inflation also redistributes wealth randomly (especially from ordinary savers) and makes all but the richest feel worse off. In a brilliant book, When Money Dies, first published in 1975 and recently reissued, Adam Ferguson traces the impact of German hyperinflation on subsequent political extremism. All of central Europe was affected, and the interwar social and political order – such as it was – fatally undermined by the phenomenon. (The brilliant wiki image shows banknotes being swept off the street in Budapest after the sudden replacement of the pengo in order to end the hyperinflation there.)

Of course we are nowhere near hyperinflation or even worrying ordinary inflation, but it would be reassuring to see signs that the Bank was thinking about where the vast quantities of money it's printed since 2008 have sloshed away to. A number of the comments at the event yesterday concerned the unskilled jobless and prospect-less young men as a source of political instability – the event's chair, Faisal Islam, raised this issue – and that's surely true. It is unforgivable to be churning so many boys through school without equipping them with any relevant employment skills. But there's more than one aspect of the current economic conjuncture threatening instability.

Redesigning Leadership

Leadership books are usually well worth avoiding but for some reason Redesigning Leadership by John Maeda caught my eye. It's short, beautifully designed and produced, and was sent to me by someone whose judgment I trust, so I gave it a whirl. It was a quick read, easily done in a flight or train journey, and very much worth it. There's none of the usual guff that afflicts the genre. Instead, clear crisp prose, a lot of common sense, and some points that were either new to me or worth reaffirming. Here are some of the ones I picked out – others would pick up different ideas, depending on their own background. Oh, and Maeda also tweets, and includes some of these as part of the books structure – he's @johnmaeda on Twitter.

Leading by walking around is valuable, to acquire information unavailable in any other way and to hear what concerns people.

The more important you are, the less likely people are to say what's on their mind, so you have to ask explicitly. Maeda asks at the start of meetings: “How am I doing?”

In complex organisations and environments, data visualisation is essential. Maeda recommends Processing, which I'd not come across before.

Not everybody has an analytical way of thinking (I know it's obvious, but I do and know I assume others are the same); visual approaches matter too, and “stories trump statistics”.

Transparency doesn't ensure clarity – people have to understand

Make sure there are relevant differences – in ways of thinking, experiences – in your team (this is very important – see Scott Page's terrific book, The Difference).

Free pizza is the best way to get people to come to meetings – and then they talk when they are there.

“Having a sufficiently big ego means you're comfortable enough not to have one at all.”

He also ends the book by thanking the reader, which is actually a strikingly effective courtesy, and one I must remember.