Tag Archives: review

What a spectacle

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The subtitle of Alex Preda’s The Spectacle of Expertise is ‘why financial analysts perform in the media.’ I was interested because the everyday perception many people have of economists is shaped by seeing City economists talking about markets up, exchange rates down, inflation either up or down…. whereas of course most economists don’t do financial or macroeconomics. Yet the financial markets and commentary on them define the subject for so many.

Anyway, the book is rather interesting. It’s a sociology or ethnography largely based on fieldwork in Hong Kong, where there are many, many more financial programmes to be filled with expert commentary, and it seems that for many people working in the markets there is pretty much a full time career phase of going around the studios performing. The best known even get hired to advertise other products – a new hair conditioner being a ‘good investment’ for instance.

Prada describes the whole spectacle (yes, Debord, hello), a performance requiring a team – the expert talking head but also their research assistants back on the trading floor, the programme anchor, the producer and their team, the make-up artists and sound technicicans. All in the interest of selling more finance products and growing the sector. In the financial realm of exchanging digitised symbols, the embodied reality of a persuasive talker with good make-up and a Bloomberg screen accessible on their phone is central.

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Not engineering

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This week I read Herbert Simon’s The Sciences of the Artificial, first published in 1969, and must confess to not knowing what to make of it. He contrasts ‘the artificial’ to ‘the natural’ but also more specifically applies it to complex systems designed to adapt to their environment, and compares arenas such as economics, management, and engineering systems. The point is then to analyse what properties they have in common, on the basis of information theory. The aim is evidently to present a common analysis of the various types of system considered. So far, so good. And as Professor Google tells me, the book was very influential in the design of computer systems and design theory more generally.

Beyond that? Well, I asked Bard, which said:

“The book argues that artificial systems can be studied scientifically, just like natural systems. Simon defines an artificial system as “a system that has been brought into being by human design.” He argues that artificial systems are not just imitations of natural systems, but are in fact a distinct class of systems with their own properties and laws.

Simon then goes on to discuss the various aspects of artificial systems that can be studied scientifically. He covers topics such as the design of algorithms, the nature of problem solving, and the role of heuristics in decision making. He also discusses the relationship between artificial systems and human intelligence.”

Very timely, then. But I’m hard pushed to summarise what the conclusions are, and allergic to the strong positivism of it. As readers of Cogs and Monsters will know, I think economic systems differ from engineering systems in important ways, and are not amenable to exactly the same kind of ‘scientific’ analysis. The ‘sciences of the artificial’ seem like they do well in analysis of algorithmic systems, but not so much – contrary to the claim in the book – for education, art and architecture, or indeed economics.

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Then and now

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Two of my latest reads have been Melvyn Bragg’s memoir of growing up in mid-20th century, working class Cumbria, Back in the Day, and Alwyn Turner’s canter through early 21st century British politics, All In It Together. They make quite an instructive contrast. Bragg’s warm perspective on postwar optimism – despite material hardships – complements his own story of academic success through grammar school and Oxford scholarships. Turner’s jolly but fundamentally pessimistic account of a materially far richer country is a contribution to the large and sadly still-growing literature on the UK’s decline. Both good reads, although as a working class kid from the north west who clambered the social ladder via grammar school scholarship and Oxford (albeit 20+ years later) I particularly enjoyed Back in the Day: pick according to your mood.

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European elegy

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My non-econ reading lately has been Timothy Garton Ash’s Homelands: A Personal History of Europe. I describe it as an elegy because of its melancholy narrative trajectory: from the 2nd world war and ‘never again’, through the ups and downs of the EU project, to today’s brutal invasion of Ukraine, “illiberal democracies” tearing up the hard-won freedoms, and the pressures of mass immigration – which will only get more intense as climate change leads to conflict and destruction.

Like the author, I mourn the way our European citizenship has been stripped from those of us in the UK, by a slender margin, by voters who were lied to by mendacious and greedy politicians and businessmen. And at the same time recognise the challenges the EU itself needs to address. No wonder the book ends by quoting Gramsci on pessimisim/optimism. But also Vaclav Havel: “Hope is not prognostication. It is an orientation of the spirit, an orientation of the heart. …. It is not the conviction that something will turn out well, but the certainty that something makes sense, regardless of how it turns out.”

So, not a cheering read, at least for those likely to pick up a book about Europe. But a compelling read, by someone who had a ringside seat at many of the key meetings and ‘where were you when…’ events (above all the fall of the Berlin Wall) of the past 40 years.

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PS For those who haven’t read it, Garton Ash’s The File: A Personal History is a must- read.

Saving liberalism

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I liked Thomas Aubrey’s short book, All Roads Lead to Serfdom: Confronting Liberalism’s Fatal Flaw. It could alternatively be called, Confronting the weaknesses of the Anglo-Saxon economic model. But it does this in a thoughtful way, contrasting the utilitarian tradition of UK/US economic policy with (West) Germany and the “underlying ordoliberal principle of power dispersion.” It is quite a philosophical book, which concludes that private and public power must be dispersed across labour markets, product markets and the activities of the state (as well as the liberal market basics of secure property rights and a stable currency). As well as stressing the importance of ideas, though – and I wholeheartedly agree – the book calculates power dispersion indices (“to provide a potential alternative framework to the current utilitarian welfarist approach”) and has a serise of proposals for how to disperse power in the three domains.

The empirics turn out broadly as you might expect. Canada, Switzerland, Denmark and Sweden turn out to have widely dispersed state power, as does the US, and the Scandinavian countries cluster near the top of all three rankings. The UK is near the bottom of all three rankings, while the US is near the top for state power dispersion but not labour or product markets. This seems to me to understate the traction economic power delivers in terms of political power, albeit through sometimes indirect channels.

The book’s compare and contrast with the German model is interesting although Aubrey concludes Germany itself has not delivered on ordoliberal ideals. I rather agree with its final conclusion: “If liberalism is to have a future, it will require those who believe in liberal values to make the case for an alternative ethical foundation; one where freedom and equality can be contsnatly manufactured by the continuous dispersal of public and private power.” Ideas are indeed important for winning hearts and minds. The naive utilitarianism underlying the eocnomic policy playbook of the past 40 or 50 years has lost hearts and minds. But I’m not sure framing what’s needed in terms of ‘ordoliberalism’ with all its free market and Hayekian baggage will be an easy sell, hearts and mind-wise. (And the book has been priced only for libraries by its publisher, Bristol University Press, so it won’t even get much chance to influence people.)A1e0JCBaNuL._AC_UY436_QL65_