End October Links

# What does the long term price guarantee for electricity given by the UK Government (UK nuclear power plant gets go-ahead) say about Prof Gordon Hughes's contention (at last month's International Conference on Economics of Constitutional Change [slides and paper here]) that given current high prices, we should expect energy prices to fall, and that English consumers are unlikely to want to buy low carbon electricity from a renewables-powered Scotland?

# Of academic interest:
   - The Fractal Market Hypothesis and its implications for the stability of financial markets (related to Mandelbrot's 'The Variation of Certain Speculative Prices')

# Wayhey!? Nuclear fusion milestone passed at US lab: "during an experiment in late September, the amount of energy released through the fusion reaction exceeded the amount of energy being absorbed by the fuel - the first time this had been achieved at any fusion facility in the world"

# Borrowing from the Future — Except that We Aren't: "At an individual level, borrowing is truly borrowing from the future.  At a population level, borrowing is the creation of assets and liabilities across different people.  People like King are committing a fallacy of composition. Incidentally, we are borrowing from the future.  We are shirking the investments we need to make so that our children and grandchildren can live in a habitable world with a well-educated population that enjoys a productive infrastructure.  No fallacy of composition there."

# Interfluidity say that Mobility is no answer to dispersion: "If we augment standard utility functions with plausible notions of habit formation and social reference group comparison, the case against mobility grows even stronger. The cost and shame of downward mobility dramatically outmatches the potential benefit of upward mobility...A functional polity values rising fortunes across the wealth spectrum, but it fears and resists falling fortunes much more strenuously. I would go so far as to claim this is a universal social fact, a characteristic of all polities that endure. Capitalism is always crony capitalism — and socialism tends towards crony socialism! — not because of corrupt bad actors but because human lifestyles are sticky-downward. Large social divergences can in practice be remedied smoothly only by convergence upward from the bottom. The wise course is to prevent extreme divergence from emerging in the first place. Once it has, the only way out is to hope for growth, and to direct the fruits of growth towards the bottom of the distribution."

# Great idea from Chris Dillow: Shares in people

# From the ESRC's Future of the UK and Scotland project blog: How the SNP can still win the vote for an independent Scotland "Poor rates of economic growth, high levels of emigration and appalling social and health conditions of Scotland should be difficult to defend. If independence is to be judged over the long haul, so too should the union. Yet supporters of the union have been under little pressure to defend Scotland's miserable record within it. Historians will look back on this campaign and ask why unionists were not on the defensive given this poor track record."

# George Rosie Losing the Heid - this has to describe the losses that come from being a peripheral region of a large country (as well as a peculiarly British attitude to corporate ownership). Such losses might well be simply reallocative (and may even represent aggregate efficiency gains) but they are certainly losses to those of us who live in Scotland (and north England, Northern Ireland, and Wales). I suspect once imperfect information and agency problems are included in the analysis that they likely also do not represent aggregate efficiency gains.