Mexicans and Brazilians generally hate any comparisons of one another, and indeed, they’re very different in many ways: different colonizers, different histories, and they’re thousands of miles apart on different continents. Also, Brazil has a large share of government spending/transfers in GDP, while Mexico has a small share: Brazil barely under 40%, like a developed Western European/OECD country. On the other hand Mexico’s share is much lower at about ¼. This is lower even than the USA’s ~36-7%. ... Read more

Yesterday, minding my own business on Twitter, I came across an article that made me, as well as about half of the internet, furious. Someone was wrong on the internet. It turned out that an undergraduate was wrong on the internet, and despite the generally low esteem I hold for Quillette as a publication 1 and the generally acute contempt I hold for Thomas Sowell as an intellectual — his mediocre oeuvre is conspicuously overrepresented in the footnotes of the essay — I didn’t really want to dunk on an article written by an undergraduate. ... Read more

How much should workers get paid in a country going through (or aspiring to) broad-based economic growth? the economist asks. She quickly explains her use of should refers to an equilibrium solution rather than a moral sense of ideal, but her historian friend is still not convinced. What is relevant, the historian says, is why in some places and times in the past workers got a larger slice of the cake than in others. ... Read more

What kind of rich people do poor countries need? 1 The wrong kind of rich person, after all, can be incredibly bad for growth. Money buys power, and power is, if not exactly zero-sum, at least usually highly restricted in supply. If elites spend most of their wealth in preventing other people from gaining power at their expense, then they can seriously hold back broad-based economic growth. For example, they might discourage the poor from getting an education, as Jörg Baten has demonstrated with a series of coauthors. ... Read more

On paper, federations generally seem like a good idea. A federal state can pool the resources of what would otherwise be separate economies to provide public goods more efficiently, which is what states are there for, at least from an economist’s perspective. Public goods, to expand Samuelson’s 1954 definition a little bit,1 are those which can be enjoyed in common, either because they can be consumed by each individual without detracting from anyone else’s consumption (e. ... Read more

So the genie comes out of the economic history lamp and you ask for vast green pastures, or plentiful oilfields, or something along those lines. But as usual with genies and wishes there is a catch, or several. First of all, the genie’s gift can be irritatingly resource-specific: you end up with a grassland economy that produces food for ten times its population but has no domestic fossil energy sources—like Uruguay—or with a desert country that has unparalleled oil reserves but relies on imported food to keep workers fed—like Saudi Arabia. ... Read more

Neither Egypt nor Russia is Denmark, and you can tell because Egypt and Russia are in Group A in the World Cup and Denmark is in Group C. In the shorthand used by economic historians, however, in which “Denmark” is more adjective than noun—”why isn’t country X Denmark?“—the short answer is that neither Russia nor Egypt, despite considerable growth in the 20th century, is rich enough to be considered “Denmarkish”. ... Read more

Australia and France share both a well-recognised maritime border as well as a substantial if somewhat less recognised land border (in Antarctica, but who’s counting). And yet despite this proximity, merchandise trade between France and Australia, at least in the important products, defies economic gravity: Belgium received $438 million of French cheese in 2016, while Australia, despite having an economy almost three times as large as Belgium’s, only got $24 million of the stuff. ... Read more

There was a time when saying Spain versus Portugal was a shorthand for Western expansion overseas, inter-imperial competition (as well as cooperation), and new worlds below the Tropics full of spices, sugar, and silver. The Iberian peninsula was, in the sixteenth century and beyond, the Janus-faced prow of Europe towards the Atlantic. But the Iberian rivalry was not merely about whose flag would be flying over which harbour—it was also a struggle between two models of empire. ... Read more

When the French parliament, including colonial representatives, was discussing the framework of a new relationship between French Africa and the metropole, a slight plaintive note could be detected in the contributions of the representatives of Côte d’Ivoire and Gabon. Respectively, these colonies were the largest economies of the federations of French West Africa (Afrique occidentale française, or AOF) and French Equatorial Africa (Afrique équatoriale française, or AEF). The white Ivorian planter Gaston Lagarosse said: ... Read more