Category: Economics
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The Real Sector of the Blockchain Economy
Most cryptocurrencies are now over 60% down from their December 2017 peak. While prices are still quite volatile, the trend for the last five months is decidedly downwards. While some still expect a recovery to the glorious days of last year, others see overvaluation all around accompanied by a financial bubble about to burst. Comparisons…
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Blockchain Mining Revisited
Blockchain mining cannot catch a break when it comes to environmental sustainability. This is especially true for Bitcoin mining that seemingly has an insatiable appetite for electricity. A recent paper suggests that by 2020 Bitcoin mining will consume as much energy as Australia. While these estimates are not exempt from criticism, mining does not appear…
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Democracy and Capitalism: Friends or Foes?
The post-WWII era can be arguably defined as the golden age of democratic capitalism – at least from the perspective of developed or industrialized countries. Rebuilding Europe and pumping capital into Japan triggered a prolonged economic boom until the 1980s, notwithstanding the 1973 oil crisis. The fall of the Berlin Wall in 1989 opened new…
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ICO Update: A Slowdown in Sight?
ICO data for last February is now available and shown in Figure 1 below. We can immediately see that both the number of ICOs and the total investment volume has decreased. The latter, which amounted to 1.2 billion USD for the month, is 20 percent less than the total for January this year. The same…
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Chasing ICOs (away?)
Recent events seem to suggest the cryptocurrency bubble is finally starting to deflate. Bitcoin, Ethereum and most of their crypto cousins are significantly down while regulators in several countries are finally beginning to take action on the ground. Nobel laureate economists are also speaking up against the digital currency, arguing that the new currency cannot fulfill…
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Cryptocurrencies and Development
While not the only cryptocurrency around, Bitcoin was the first to solve the well-known double-spending problem that characterizes digital currencies. Tackling the issue demanded the creation of blockchain technology (BCT) combined with a brute force algorithm known as proof of work. Created in 2009, Bitcoin is now one of the largest (and most unstable) currencies…
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The Butterfly Effect
The weather forecast indicated that heavy rain will commence overnight, lasting close to 36 hours and, in the process, dumping from 1 to 3 inches (2.5 to 7.5 centimeters) on the ground. Yes, a lot of rain was expected. But I had to find a break in the rain to be able to go out…
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Blockchain ICOs Revisited
A couple of weeks ago, Coindesk launched an ICO tracker which seems quite comprehensive and includes data starting in 2014. It has information on 164 ICOs1 I downloaded the data on 18 August but was unable to replicate some of the charts Coindesk has on its web site. The data I downloaded ends on 27…
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Tax Season 2017
Spring finally arrived but today feels more like summer. Not sure it will last but in I know New York Springs usually tend to be relatively short. Summer seems to always be extremely eager to enter the scene. In any event, the arrival of Spring is always associated with the US deadlines for submitting taxes,…
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Towards a Philosophy of Technology
Written back in 1984, the content of Albert Borgmann’s book loudly resonates today. Borgmann argues that contemporary life is shaped by technology that stamps its imprint all over the place, and can even define its whole character. However, such a pattern is not usually evident nor always utterly dominant as technology has to compete with…
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More on Measuring Human Development
In a previous blog, I examined the relationship between GDP and the Human Development Index (HDI), which the UN Development Programme (UNDP) has published annually for the last 25 years. In this post, I want to dive deeper into the latter and explore some of its potential policy implications. HDI components and calculation The HDI…
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Is Postcapitalism on its way?
For most people, including many well-known economists, the 2007 global economic crisis was a rude awakening: It seemed to have come out of nowhere, but it certainly managed to bring deep pain to billions of people – and pockets. Soon thereafter, calls to revisit Marx’s theory of capitalism became frequent from both left and right.…
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Saving Capitalism – or Democracy?
Few will doubt both globalization and technology are putting many people under economic stress. Symptoms of this in the US and other industrialized countries include raising inequality, stagnant wages, less opportunities and decreased social mobility, and little to no improvement in living standards for most. Together, they have created an environment characterized by widespread distrust…
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Measuring Well-Being and Human Development
GDP: Thanks, but no thanks A recent issue of The Economist had a couple of articles (plus the issue’s cover) on measuring prosperity, defined as advancing living standards over time. Nowadays, gross domestic product, GDP,1 We can also include here GDP’s sibling, Gross National Income or GNI. is king for measuring such progress. However, The…
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Economics Rules or Economics Rule?
After the 2008 crisis, many observers expected changes of some sort in current economic thinking and academic teaching. After all, most mainstream economists never saw the crisis coming – with some even claiming the era of crises was over. For many non-economists, the crisis demonstrated once again the perils of economics, the “dismal science”. Eight years…