I was recently asked my opinion on Islamic banking. I know next to nothing about that. I am told that it is against Islamic principles to charge interest on loans. As a liberal, I take the position that people ought to be free to do whatever they want with their property. They should be free to lend their money at whatever interest they want (including zero interest or a million percent interest.) The only condition is that there must be no coercion involved.
Therefore, anyone who is handing out interest free loans out of their own wealth will find a willing borrower in me. Although it is obvious that giving out interest-free loans is an idiotic thing to do, I don’t believe it is anyone’s business to force people to avoid folly.
In the previous post “Economics and Physics” I briefly explored why the basic explanations of physics are hard to understand and why the basic explanations of economics are easy to understand. Physics is called a “hard science”. I believe it is hard in the sense that advances in physics are made by supremely intelligent people and even comprehending them requires a good deal of training and intelligence.
Physics is also hard in that it is not some soft and squishy, namby-pamby whatever goes kind of nonsense, unlike in some other intellectual enterprises where people just make up stuff as they go along.
Nobel Prize winning New Zealand physicist Ernest Rutherford (1871 – 1937) is reported to have claimed that “all science is either physics or stamp collecting.” He evidently meant that physics is the only real science and everything else that goes under that label is just a collection of facts.
The wiki’s definition of science as “a systematic enterprise that builds and organizes knowledge in the form of testable explanations and predictions about the universe” serves our purposes. Physics is the über-science because it alone provides the ultimate foundation for all explanations related to what the natural world is about.
What makes physics not merely a heap of facts — what distinguishes it from stamp collecting — is that it is organized knowledge. The organization of knowledge is achieved through what are called “theories”. Theories are conjectures (hypotheses) about the nature, structure or working of some aspect of nature. Theories in physics are conjectures about what the physical world is and how it functions. Continue reading “Economics and Physics”
What makes for a good leader? That depends on how you define good and the context — a corporation or a nation or a social movement. How much do qualities such as morality, integrity, intelligence and other personal traits matter? Are leaders born or are they made by accidental circumstances? Can a political leader really alter the trajectory of a nation dramatically for the better?
Twenty-five years ago today, on March 23 1992, Friedrich August von Hayek died. Winner of the 1974 Nobel Memorial Prize in Economic Sciences, Hayek was an Austrian / British liberal. I consider him to be not just one of the greatest economists of all times but one of the world’s most enlightened social thinkers.
Reading Hayek makes me marvel at the heights that human intellect is capable of. Compared to him, some of the most renowned economists appear to be pygmies. I feel sorry that most people — even those who claim to be economists — have not even heard of him, let alone read him. Here are a few excerpts, from Hayek and about Hayek. Continue reading “In Celebration of Friedrich August von Hayek”
“Why India Needs a New Constitution.” is the title of the chapter I contributed to a Festschrift published in November 2016 by the Center for Civil Society in Delhi.
That idea rubs Indians the wrong way because Indians generally believe that the constitution is a fine work. Not that they have examined it for themselves. They think that it must be so because politicians praise the constitution and uncritically accept their verdict.
It is like the fable of the emperor’s new clothes, except in this case the people have not themselves seen the emperor in his new clothes. They have only heard of reports that the emperor has a new set of clothes, and experts who have seen the new clothes have declared them to be wonderful. The belief has been implanted in the people, and they will vehemently oppose any suggestions to the contrary.
I argue that the emperor’s new clothes are in fact his old clothes, and therefore the “new” clothes do an equally bad job of hiding his unsightly nakedness as his old clothes did.
Some time ago I published the draft of a “Constitution for a Free India” (click to read, right-click to download pdf) which I propose should replace the current Indian constitution. In the preamble of the draft, it says —
“… The people of India as the principals agree unanimously through this constitution to empower as their agents governments at the national and state levels which shall carry out the legitimate wishes of the people as expressed by their political choices in elections. … “
I haven’t read these books that Amazon recommended to me via email today. But I hope that within the pages of these books the authors somewhere explain the economics of textbook publishing and why these books on the principles of economics cost an arm and a leg.
Thankfully in modern times, the principles of economics is accessible to many who can’t afford those prices. It’s all there on the web. Continue reading “The Price of Econ Textbooks”
This ad is probably from the mid-1980s. A massive 26MB hard drive for only $5K. As the ad points out, that’s less than $200 per MB. Now that’s a deal you couldn’t have refused. We should note that $5K in those days is equivalent to $10K in today’s dollars. Imagine, paying $10K for storage just enough for a few mp3 songs! Continue reading “Ask me anything: I am always amazed edition.”