'Lead Essay' Category Archive

How the World Got Modern

by Stephen Davies
Lead Essay
November 2nd, 2009

In this month’s lead essay, historian Stephen Davies tackles one of the biggest of big questions: How did the world we live in — the modern world — so radically and rapidly diverge from the world of our pre-modern ancestors? Davies starts with a multitude of proposed explanations and winnows them down to three: the advent of empirical science and engineering, a shift in cultural attitudes toward commerce and trade, and the development of the Westphalian system of nation-states. Yet these factors emerged over a century before modernity really took off. Why the lag? Davies argues that the missing ingredient was the unique climate of competition between ruling elites in Europe in the 17th and 18th centuries, which combined with the other elements to produce the scientific innovation and economic growth that created the modern world.

Read: How the World Got Modern

Economic Inequality and the Mirage of Injustice

by Will Wilkinson
Lead Essay
October 12th, 2009

In his lead essay, Will Wilkinson observes what he believes is a poor chain of reasoning: Income inequality is rising; it is also a measure of injustice. To fix this injustice, we should redistribute incomes. Wilkinson attacks this reasoning on several fronts: Income inequality is less important than consumption inequality, and consumption inequality is probably lessening. But if income inequality is a problem, it is so only as a symptom of a different problem: substandard schools, perhaps, or our high incarceration rate, or CEOs who conspire to overpay one another. Rather than redistributing income, we should identify the underlying problem and fix it directly. This may well lessen income inequality, and it will also fix an undoubtedly serious problem somewhere else in our society.

Read: Economic Inequality and the Mirage of Injustice

The Real Problem was Nominal

by Scott Sumner
Lead Essay
September 14th, 2009

In this month’s sure-to-be controversial lead essay, Bentley University economist Scott Sumner argues that almost everything economists and economic policymakers thought they knew about the role of monetary policy in the recent recession and financial collapse is wrong. Sumner contends that the resources of monetary policy were not exhausted, as many economists believed, but were barely used. Flying in the face of conventional wisdom, Sumner maintains that monetary policy in the run-up to the finacial crisis was not highly expansionary, but was in fact disastrously contractionary. Sumner offers a short history of monetary economics to put into historical perspective the role of allegedly failed monetary policy in the financial crisis and recession. He proposes a strategy for central bankers — targeting forecasts of nominal GDP — that might help avert future crises. In conclusion, Sumner warns of the political dangers of misdiagnosing the crisis: unless the record is set straight, free markets will once again take the fall for a failure of monetary policy.

Read: The Real Problem was Nominal

A U.S. War with Mexican Consequences

by Jorge Castaneda
Lead Essay
August 5th, 2009

In his lead essay, Jorge Castañeda observes that the consequences of the U.S. drug war fall unevenly on Mexico. The U.S. taste for drugs — and for prohibition — are the chief causes of drug-related crime in Mexico, he asserts. This creates a problem that Mexico cannot solve on its own. U.S. assistance has been insufficient, and Mexican resources are too few to take on the drug cartels effectively. Even if the resources were available, the militarization of life in Mexico would be politically unacceptable to most Mexicans, who have enjoyed a relatively tranquil military in contrast to many other Latin American countries. Another approach to the war on drugs would simply be decriminalization, but again, Mexico cannot unilaterally decriminalize, because it would face severe diplomatic consequences from the United States and possibly become a refuge for addicts. The United States must lead the way toward solving this problem, which is of its own making.

Read: A U.S. War with Mexican Consequences