A Book Review on Price Controls..............

With the development of Transfinancial Economics we would get a far more accurate picture of Economy as never before in human history. It would give us vital knowledge on how advanced digital price controls (as opposed to largely manual ones) could  be successfully used to control inflation. This would be a huge step forward and as more and more capital could be transmitted into the economy to notably  to fund vital huge and small green sustainable business  projects et cetera on a colossal scale. Ofcourse, shortages may occur but they would be increasingly rare. All this would happen in a capitalist type economy. 

Transfinancial Economics

R. Searle/blogger

How Popular Misconceptions about Inflation, Prices, and Value Create Bad Policy

This edited volume debunks popular myths about the origins of inflation, the desirability of price controls, and what product prices tell us about value.

May 2024 • Published By Cato Institute

By Ryan Bourne

Was inflation’s recent spike exacerbated by corporate greed? Do rent controls really help the needy? Are U.S. health care prices set in a Wild West marketplace? Do women get paid less than men for the same work, and do they pay more than men for the same products? The War on Prices is an eye-opening book that answers all these burning questions and more, as top economists debunk popular misconceptions about inflation, prices, and value.

Market prices are under siege. The war on prices is waged most obviously with damaging government price controls and the harmful effects of central bank monetary mismanagement, as we saw with the recent inflation. Yet these bad policies are propped up by widespread, misguided public beliefs about the causes of inflation, the effects of price controls, and the inherent morality of market prices.

Breaking down these complex issues into three distinct sections―inflation, price controls, and value―this book both sheds light on long-standing contentions and brings economic theory and evidence to bear in today’s most contentious debates. Threaded through the book is a revealing truth: too many of us misunderstand the origin, role, and worth of market prices in our economy. The old insult goes that “economists know the price of everything and the value of nothing.” The War on Prices shows that good economists―and soon, you―can appreciate the value of unshackled market prices in delivering prosperity.

Praise for the book

“The United States and indeed most of the world is coming off a major bout of inflation. Fallacies have been multiplying in the media and from commentators. Ryan Bourne has edited a new volume—The War on Prices—that sets the record straight. Here is your go-to book on rising prices, price controls, and other government policies toward prices.”
—Tyler Cowen, Holbert L. Harris Chair of Economics at George Mason University and founder of Marginal Revolution

“It is not just actual prices that have risen unusually rapidly in recent years—muddled thinking about prices has grown exponentially. I do not agree with the conclusion of every chapter of this volume, but I agree with most of them. And all of them are grounded in the type of rigorous economics and empirics that are sadly missing in too much of the popular debate.”
—Jason Furman, former chair of the Council of Economic Advisers and Aetna Professor of the Practice of Economic Policy, Harvard University

“The War on Prices is a fantastic book. It comprehensively makes the case that price controls do great harm, often to the people they are supposed to help. Particularly good are the chapters on rent controls, price controls on oil and natural gas, and so-called junk fees, which are really fees to solve problems that would exist without them. If the chapter on why we should have a free market in water were taken to heart, my fellow Californians and I would be much better off. Read this book and learn.”
—David R. Henderson, research fellow at the Hoover Institution and editor of The Concise Encyclopedia of Economics

“Prices make people angry. Most of the time we feel like we are paying too much for the goods or services we consume, or are being paid too little for the labor we sell. But prices are also a miracle—they make commerce possible and convey invaluable information. We mess with them at our peril. Ryan Bourne has edited a delightful collection of essays that stand up for what is perhaps the most hated but most important of economic indicators—the market price.”
—Allison Schrager, senior fellow at the Manhattan Institute and columnist at Bloomberg Opinion

Contributors

Brian Albrecht, Pedro Aldighieri, Nicholas Anthony, David Beckworth, Eamonn Butler, Vanessa Brown Calder, Michael Cannon, Jeffrey Clemens, Bryan Cutsinger, Alex Edmans, Peter Jaworski, Pierre Lemieux, Deirdre McCloskey, Jeffrey Miron, Liya Palagashvili, Joseph Sabia, J. R. Shackleton, Peter Van Doren, and Stan Veuger

About the editor

Ryan A. Bourne occupies the R. Evan Scharf Chair for the Public Understanding of Economics at the Cato Institute and is a columnist for The Times (UK). He has written on a variety of economic issues, including fiscal policy, inequality, price and wage controls, and infrastructure spending, and is the author of Economics in One Virus: An Introduction to Economic Reasoning through COVID-19. He has extensive broadcast and print media experience and has appeared on CNN, CNBC, BBC News, Sky News, and Fox Business Network.

The above came from a link which appeared in the following article. Unfortunately, the link does not work at present. 

https://www.ft.com/content/63934a18-e71e-457a-be7f-8d93c75f13f2

Chris Giles on Central Banks  Central banksAdd to myFT Why Kamala Harris’s price proposals could be damaging for the US economy Presidential candidate’s economic plan is good politics but its impact is likely to be underwhelming 

The Big Data revolution can revive the planned economy

The following is an article from the Financial Times (September  2017)which is both novel, and important. It has a special  relevance  to Transfinancial Economics which may well be the economics of the future. Big Data plays a vital role in it.  See Blogger Link https://wiki.p2pfoundation.net/Transfinancial_Economics













There are several theories why the Soviet Union collapsed: imperial overstretch, economic inefficiency, ideological bankruptcy. Take your pick or mix all three.
But in his book Homo Deus, the Israeli historian Yuval Noah Harari suggests a more prosaic reason: planned economies (and authoritarian regimes) are rubbish at processing data. “Capitalism won the cold war because distributed data-processing works better than centralised data-processing,” he wrote.
How could any central planner sitting in Gosplan’s offices in Moscow hope to understand all the moving parts of the Soviet economy across 11 time zones?
The lunacy of that system was best explained to me by Otto Latsis, the late Russian economic journalist. He recounted how he once visited a Soviet roof tile manufacturing company, which had big expansion plans. He discovered that all the investment was being sunk into a separate plant to destroy discarded, imperfect tiles to stop them being sold on the black market by the factory’s workers.
As with most Soviet factories, the planners had set demanding targets for the new plant, focusing on quantity rather than quality, creating perverse incentives to smash up near-perfect tiles. It is hard to think of a starker example of the value destruction that wrecked the Soviet economy.
But the explosion of data in our modern world could — at least in theory — inform far better managerial decisions and reduce the information imbalances between a planned and a market economy. Central planners are rapidly acquiring the tools to process data a lot more effectively.
All our connected devices are pumping out oceans of data about our real-time economic activities, demands and desires. Properly harnessed, that data could mimic the price mechanism as a means of matching demand and supply.

Recommended

For the past few decades, free market economists have been stomping on the grave of the planned economy. Might it rise again in a radically new form?
Some seem to think so in China, which remains wedded to Communist ideology — no matter how loosely applied in practice — and is developing one of the most vibrant data markets in the world.
Last year, Jack Ma, founder of Alibaba, the online platform with some 500m users, argued new technologies provided the means to gather and process data on a near-unimaginable scale.
Applying artificial intelligence to those data sets was deepening our real-time understanding of the world. “As such, Big Data will make the market smarter and make it possible to plan and predict market forces so as to allow us to finally achieve a planned economy,” he told an economic conference.
Some Chinese economists have gone further. In a recent paper Binbin Wang and Xiaoyan Li argue that a hybrid economy could be built on a “market-based, plan-driven” model.
The freer flow of data could counter many of the ills that disfigured planned economies: excessive concentration of power, rent-seeking corruption, and irrational decision-making. The granular detail provided by masses of data could also enable planners to offer consumers more personalised choice.
The authors argue that the online platform monopolies resemble central planning institutions. It would be more “legitimate and rational” for the state to become a “super-monopoly” platform.
Such state-owned platforms could operate like an airport directing market-driven traffic. The airport manages capacity, sets aviation standards, balances the demands of safety, the environment and the movement of goods, and serves the needs of
operators, passengers and retailers.
There is no doubt that Big Data can improve the efficiency of managerial systems, both corporate and governmental. It might also lead to more rational resource allocation, whether in terms of planning long-term infrastructure or managing healthcare systems.
But while this hybrid economy may be neat in theory, two big doubts hang over its viability in the real world.

The freer flow of data could counter many of the ills that disfigured planned economies: excessive concentration of power, rent-seeking corruption, and irrational decision-making

The first is that accumulating data and using them in sensible ways are two very different propositions, as shown by any number of failed governmental IT projects around the world.
The second is how innovative such an economy could ever hope to be. It is hard for consumers to signal a data demand for a product that does not yet exist. In some respects, it would be like trying to drive into the future by staring into the rear-view mirror.
As Apple’s co-founder Steve Jobs famously said: “Consumers don’t know what they want until we’ve shown them.”
If you are a subscriber, add John to myFT in order to receive alerts when his articles are published. To do so, just click the button “add to myFT” which appears beside his name on this page. Not a subscriber? Perhaps you want to follow John on Twitter @johnthornhillft.
john.thornhill@ft.com

Corbynomics has not been thought through seriously

Blogger Ref http://www.p2pfoundation.net/Transfinancial_Economics

Sir, We wish to register our opinion that the economic policies sketched by Jeremy Corbyn are likely to be highly damaging, and send this message to counter the impression that might be got from the previous letter of “41 economists” that Mr Corbyn’s policies command widespread support in the mainstream of the discipline.

Renationalising industries is highly unlikely to improve the performance of its targets, and very likely, if history is anything to go by, to make things worse. If compensation is paid, it will be a waste of fiscal space, even unaffordable; in case it is not, it will be extremely damaging to the climate for enterprise in the UK as other companies fear the government would get a taste for it.

“People’s QE” would be a highly damaging threat to fiscal credibility, and unnecessary, since at this time of very low interest rates and tolerable debt/GDP public investment — in many areas much needed — can be financed conventionally. Figures put on money that could be found from ending “corporate welfare” and combating tax evasion are almost unbelievable and add to the sense that Mr Corbyn’s plans have not been seriously thought through.

Paul Levine
Professor of Economics,
University of Surrey
Tony Yates
Professor of Economics,
University of Birmingham
Wouter den Haan
Professor of Economics,
London School of Economics
John van Reenen
Professor of Economics,
London School of Economics
George Magnus
Associate, China Centre,
University of Oxford
Ronald MacDonald
Professor of Economics,
Glasgow University
Cristiano Cantore
Senior Lecturer in Economics and
Deputy Head of School, University of Surrey
Joe Pearlman
Professor of Economics,
City University
Kent Matthews
Professor of Economics,
University of Cardiff
Costas Milas
Professor of Economics,
University of Liverpool
Akos Valentinyi
Professor of Economics,
Cardiff University
Valentina Corradi
Professor of Economics,
University of Surrey
Alex Mandilaras
Senior Lecturer in Economics,
University of Surrey
Cian Twomey
Lecturer in Financial Economics,
National University of Ireland, Galway
Miguel Leon-Ledesma
Professor of Economics,
University of Kent
Alexander Mihailov
Associate Professor of Economics,
University of Reading
Peter Sinclair
Professor of Economics,
University of Birmingham
Christopher Martin
Professor of Economics,
University of Bath
Richard Disney
Professor of Economics,
University of Sussex and Institute for Fiscal Studies
John Fender
Professor of Economics,
University of Birmingham
Chris Florakis
Associate Professor of Finance,
University of Liverpool
Philip Rothman
Professor of Economics,
East Carolina University
James Foreman-Peck
Professor of Economics,
University of Cardiff
Juan Paez-Farrell
Lecturer in Economics,
University of Sheffield
Mike Wickens
Professor of Economics,
University of York
Michael McMahon
Associate Professor of Economics,
University of Warwick
Michael Ben-Gad
Professor of Economics,
City University
George Bratsiotis
Reader in Economics,
University of Manchester
Dr Rebecca Driver
Economist, Analytically Driven
Phillip Booth
Professor of Insurance and Risk Management,
Cass Business School
Theo Panagiotidis
Professor of Economics,
University of Macedonia, Greece
Ali Al Nowahi
Professor of Economics,
University of Leicester
Manthos Delis
Professor of Financial Economics and Banking,
Surrey Business School, University of Surrey
Martin Ellison
Professor of Economics,
University of Oxford
Christopher Spencer
Lecturer in Economics,
University of Loughborough
Alastair Milne
Professor of Economics,
University of Loughborough
Tom Holden
Lecturer in Economics,
University of Surrey
Patrick Minford
Professor of Economics,
University of Cardiff
Mark Koyama
George Mason University,
Washington DC, US
Ettiene Farvaque
Professor of Economics,
University of Lille
Stephen Hall
Professor of Economics,
University of Leicester
Stephen Wright
Professor of Economics,
Birkbeck College, University of London
Ray Barrell
Professor of Economics,
Brunel University
Ben Ferrett
Senior Lecturer in Economics,
University of Loughborough
Roy Zilberman
Lecturer in Economics,
University of Lancaster
Richard Dennis
Professor of Economics,
Glasgow University
Peter Doyle
Former senior manager,
International Monetary Fund
Todd Kaplan
Professor of Economics,
University of Exeter
Bob Rothschild
Emeritus Professor of Economics,
University of Lancaster
James Davidson
Professor of Economics,
University of Exeter
George Kapetanios
Professor of Economics,
Queen Mary College, University of London
William Tayler
Lecturer, University of Lancaster
James Malley
Professor of Economics,
University of Glasgow
Kitty Ussher
Managing Director,
Tooley Street Research
Geraint Johnes
Professor of Economics,
University of Lancaster
Ethan Ilzetzki
Lecturer in Economics,
London School of Economics








The above comes from the  

“Strip private banks of their power to create money”: Financial Times’ Martin Wolf endorses Positive Money’s proposals for reform

Written by Ben Dyson (Positive Money) on April 24, 2014.

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Positive Money’s proposals have just been advocated by Martin Wolf, the chief economics commentator at the Financial Times, in an article entitled “Strip private banks of their power to create money“:

“Printing counterfeit banknotes is illegal, but creating private money is not. The interdependence between the state and the businesses that can do this is the source of much of the instability of our economies. It could – and should – be terminated.”

Wolf highlights the fact that the ability of banks to create money requires governments and taxpayers to underwrite the banking system:

“Banking is therefore not a normal market activity, because it provides two linked public goods: money and the payments network. On one side of banks’ balance sheets lie risky assets; on the other lie liabilities the public thinks safe. This is why central banks act as lenders of last resort and governments provide deposit insurance and equity injections. It is also why banking is heavily regulated. Yet credit cycles are still hugely destabilising.”
“What is to be done? A minimum response would leave this industry largely as it is but both tighten regulation and insist that a bigger proportion of the balance sheet be financed with equity or credibly loss-absorbing debt. … A maximum response would be to give the state a monopoly on money creation.“

The article then refers to Modernising Money, the book that we published in early 2013, and gives an overview of our proposals (summarised below):

• The state, not banks, would create all money. Customers would own the money in transaction accounts (which would never be put at risk), and would pay the banks a fee for providing payments services.
• Banks would also offer investment accounts, which fund loans. But banks could only lend money that was actively invested by customers. They would no longer be allowed to create new money out of thin air.
• The central bank would create new money as is necessary to promote non-inflationary growth.
• Decisions on how much money would be taken by a committee independent of government (much like the Monetary Policy Committee).
• Finally, new money would be injected into the economy via a) government spending, b) tax cuts, c) to make direct payments to citizens, d) to pay down existing debts – national or public, or e) to make new loans through banks or other lending firms (such as peer to peer business lenders).

Wolf highlights some of the benefits of this reform:

“The transition to a system in which money creation is separated from financial intermediation would be feasible, albeit complex. But it would bring huge advantages. It would be possible to increase the money supply without encouraging people to borrow to the hilt. It would end “too big to fail” in banking. It would also transfer seignorage – the benefits from creating money – to the public. In 2013, for example, sterling M1 (transactions money) was 80 per cent of gross domestic product. If the central bank decided this could grow at 5 per cent a year, the government could run a fiscal deficit of 4 per cent of GDP without borrowing or taxing. The right might decide to cut taxes, the left to raise spending. The choice would be political, as it should be.”

He points out only 10% of UK bank lending actually goes to businesses, meaning that restricting the level of bank lending doesn’t have to mean that businesses will suffer. (Speculative credit to property bubbles and financial markets could be restricted whilst preserving credit to businesses).
Wolf summarises by saying that:

“Our financial system is so unstable because the state first allowed it to create almost all the money in the economy and was then forced to insure it when performing that function. This is a giant hole at the heart of our market economies. It could be closed by separating the provision of money, rightly a function of the state, from the provision of finance, a function of the private sector.”

Wolf concludes that the although this change won’t come about immediately, we should remember the possibility of making these changes, because “When the next crisis comes – and it surely will – we need to be ready.”
Naturally, we’ll be working to try to bring about this change before the current system causes another crisis.

Pop Up Economics/ Tim Harford

Tim Harford's new Radio 4 series Pop-Up Economics tells stories about fascinating people and ideas in Among the stories he tells are those of Al Roth, who created a clearing-house for kidneys, the cold war game theorist Thomas Schelling and Bill Phillips, who he argues was the 'Indiana Jones of economics'.
Phillips worked as a busker, a gold miner and a crocodile hunter before studying at the London School of Economics where he used a system of water pumps and valves to create the first working model of the British economy or indeed of any economy.
Pop-Up Economics is broadcast on BBC Radio 4 on Wednesdays at 8.45pm from 16th Jan to 13th Feb. You can listen again online by downloading the podcast.



The following is some background info on Harford. He is essentially a populariser on "Economics," and ofcourse, does not offer anything really new, and important as far as economics per se goes. Wikipedia entry may be of interest all the same. RS

From Wikipedia, the free encyclopedia

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Tim Harford

Born	1973
Alma mater	Brasenose College, Oxford[1]
Awards	Royal Statistical Society Excellence in Journalism, Bastiat Prize

Tim Harford (born 1973) is a English economist and journalist, residing in London.^[2] He is the author of four economics books and writes his long-running FT column, "The Undercover Economist", which is syndicated in Slate magazine, revealing the economic ideas behind everyday experiences. His new column, "Since You Asked," offers a sceptical look at the news of the week.
Harford studied at Aylesbury Grammar School and then at Brasenose College, Oxford, gaining a BA in Philosophy, Politics and Economics^[1] and then an MPhil in Economics in 1998. He joined the Financial Times in 2003 on a fellowship in commemoration of the business columnist Peter Martin. He continued to write his column after joining the International Finance Corporation in 2004, and re-joined the Financial Times as economics leader writer in April 2006. He is also a member of the newspaper's editorial board.
In October 2007, Harford replaced Andrew Dilnot on the BBC Radio 4 series More or Less. He is a visiting fellow at Nuffield College, Oxford.

Contents  [hide]  1 Awards 2 Publications 3 References 4 External links

[edit] Awards

• More or Less won the Royal Statistical Society's 2010 award for statistical excellence in broadcast journalism^[3]
• More or Less won Mensa's award for promoting intelligence in public life^[4]
• Harford was awarded the Bastiat Prize for economic journalism in 2007 (shared with Jamie Whyte)^[5] In 2010 he again drew with Whyte, in second place.

[edit] Publications

• The Market for Aid (2005) with Michael Klein, ISBN 978-0-8213-6229-7
• The Undercover Economist (2005), ISBN 978-0-345-49401-6
• The Logic of Life (2008), ISBN 978-0-8129-7787-5
• Dear Undercover Economist: Priceless Advice on Money, Work, Sex, Kids, and Life's Other Challenges. New York, Random House. 2009. ISBN 978-0-8129-8010-3
• Adapt: Why Success Always Starts with Failure. New York, Farrar, Straus and Giroux. 2011. ISBN 978-0-374-10096-4

[edit] References

1. ^ ^{a b} "Passed/Failed: An education in the life of Tim Harford, writer and economist". http://www.independent.co.uk/news/people/profiles/passedfailed-an-education-in-the-life-of-tim-harford-writer-and-economist-410282.html.
2. ^ Harford, Tim. "The random side of riots". http://timharford.com/2012/08/the-random-side-of-riots/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+TimHarford+%28Tim+Harford%29. Retrieved 4 August 2012.
3. ^ Royal Statistical Society awards Accessed June 5, 2010
4. ^ More or Less Honoured Accessed June 5, 2010
5. ^ Fifth Annual Bastiat Prize awarded jointly to Tim Harford and Jamie Whyte Accessed June 5, 2010

[edit] External links

• Tim Harford's personal webpage with RSS Feed
• Harford's column at the Financial Times with RSS Feed
• He was a founder of PSD Blog - The World Bank Group's Private Sector Development Blog
• All is fair in love and war and poker - details of the first episode of "Trust me, I'm an economist" (BBC)
• More or Less BBC website
• Columns at Slate
• Blog at the FT, which began October 2007
• Video (and audio) of interview of Tim Harford by Will Wilkinson on Bloggingheads.tv
• TED TALKS Tim Harford: Trial, error and the God complex
• An interview with Tim Harford about The Logic of Life on The Marketplace of Ideas
• An interview with Tim Harford about Adapt on The Marketplace of Ideas

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