Classical economics and the Great Irish Famine:A study in limits

The Great Irish Famine resulted from two massive failures: the blight that destroyed the potato crop and the non-interventionism of the English government. The first failure, which also occurred in other European countries, was devastating for the Irish who depended on the potato as their main source of nourishment. The second failure was a human failure because English government policy was instructed by classical economics to let the market clear the surplus population from the land and was reinforced by the anti-Irish racism common in England at the time, even among classical economists, notably Nassau Senior and J.S. Mill. For most of the 19th century, the English answer was to ignore the hate and crush the crime which [the land system] produced. In the forty years before 1870 forty-two Coercion Acts were passed. During the same period there was not a single statute to protect the Irish peasant from eviction and rack-renting.—Winston Churchill, The Great Democracies,p. 343. It is commonplace in economic research to assume that the investigator has removed all traces of personal values from his/her work. As Becker (1961, p. 10) implies, that could be a serious error. For that reason, let me state at the outset that I am a first-generation Irish-American, holding dual citizenship in the United States and the Republic of Ireland. My mother and father both were born and raised in County Mayo—the poorest county in western Ireland, where the toll in human lives lost during the Great Famine was staggering. I do not know how many of my own Irish ancestors suffered and died during the Great Famine. What I do know and acknowledge is that my selection of this topic clearly is related to that family background which also very likely influenced the way I have interpreted the evidence presented herein. I concede that someone else sifting through the evidence might come to different conclusions, but I know of no other way to proceed. Supportive comments by Hans Jensen and Peter Danner on earlier drafts are gratefully acknowledged, as are the suggestions made by the editor and an anonymous referee. Any remaining errors are entirely mine.     

Higher education in flight: a new direction for international assignments research

This paper draws attention to the significant internationalisation of the higher education sector and role of international assignments in supporting and driving this. The paper then proceeds to identify the similarities and unique features of the sector in the context of international assignments which we argue, primarily revolve around alternative forms, namely international frequent flyers and short-term assignments. Finally, a model is proposed that may facilitate higher education institutes in more effective international assignment utilisation.     

Societal costs of multiple sclerosis in Ireland

Aims: This paper evaluates the impact of multiple sclerosis (MS) in Ireland, and estimates the associated direct, indirect, and intangible costs to society based on a large nationally representative sample.

Materials and methods: A questionnaire was developed to capture the demographics, disease characteristics, healthcare use, informal care, employment, and wellbeing. Referencing international studies, standardized survey instruments were included (e.g. CSRI, MFIS-5, EQ-5D) or adapted (EDSS) for inclusion in an online survey platform. Recruitment was directed at people with MS via the MS Society mailing list and social media platforms, as well as in traditional media. The economic costing was primarily conducted using a ‘bottom-up’ methodology, and national estimates were achieved using ‘prevalence-based’ extrapolation.

Results: A total of 594 people completed the survey in full. The sample had geographic, disease, and demographic characteristics indicating good representativeness. At an individual level, average societal cost was estimated at €47,683; the average annual costs for those with mild, moderate, and severe MS were calculated as €34,942, €57,857, and €100,554, respectively. For a total Irish MS population of 9,000, the total societal costs of MS amounted to €429m. Direct costs accounted for just 30% of the total societal costs, indirect costs amounted to 50% of the total, and intangible or QoL costs represented 20%. The societal cost associated with a relapse in the sample is estimated as €2,438.

Limitations and conclusions: The findings highlight that up to 70% of the total costs associated with MS are not routinely counted. These “hidden” costs are higher in Ireland than the rest of Europe, due in part to significantly lower levels of workforce participation, a higher likelihood of permanent workforce withdrawal, and higher levels of informal care needs. The relationship between disease progression and costs emphasize the societal importance of managing and slowing the progression of the illness.     

Monitoring mortality: a state-space approach

"A state-space model is developed which provides estimates of decrements in a dynamic environment. The model integrates the actual unfolding experience and a priori or Bayesian views of the rates. The estimates of present rates and predicted future rates are continually updated and associated standard errors have simple expressions. The model is described and applied in the context of mortality estimation but it should prove useful in other actuarial applications. The approach is particularly suitable for dynamic environments where data are scarce and updated parameter estimates are required on a regular basis. To illustrate the method it is used to monitor the unfolding mortality experience of the retired lives under an actual pension plan."     

Optimal Portfolio Selection with Transaction Costs

Abstract

This paper examines the lifetime portfolio-selection problem in the presence of transaction costs. Using a discrete time approach, we develop analytical expressions for the investor's indirect utility function and also for the boundaries of the no-transactions region. The economy consists of a single risky asset and a riskless asset. Transactions in the risky asset incur proportional transaction costs. The investor has a power utility function and is assumed to maximize expected utility of end-of-period wealth. We illustrate the solution procedure in the case in which the returns on the risky asset follow a multiplicative binomial process. Our paper both complements and extends the recent work by Gennotte and Jung (1994), which used numerical approximations to tackle this problem.     

Optimal design of equity-linked products with a probabilistic constraint

There is a rich variety of tailored investment products available to the retail investor. These products combine upside participation in bull markets with downside protection in bear markets. Examples include the equity-linked products sold by insurance companies and the structured products marketed by banks. This paper examines a particular contract design for products of this nature. The paper finds the optimal design from the investor's viewpoint. It is assumed that the investor wishes to maximize expected utility of the terminal wealth subject to certain constraints. These constraints include a guaranteed rate of return as well as the opportunity to outperform a benchmark portfolio with a given probability. We derive the explicit form of the optimal design assuming both constraints apply and we illustrate the nature of the solution using some specific examples.     

Bill Waters on Schumpeter

Bill Waters’ dissertation “Entrepreneurship, Dualism, and Causality: An Appreciation of the Work of Joseph A. Schumpeter” completed at Georgetown University in 1952 is significant for two reasons. The first is clear enough from the very beginning: Schumpeter and the entrepreneur. The other comes to light through hindsight: Bill brings to bear an understanding of economic affairs which is personalist rather than individualist or collectivist in nature. In short, Bill sees as the main activating force in economic affairs not the impersonal forces of the market, not the central planning board, but the person who innovates, who acts bolding in economic affairs, the banker who creates credit, and the capitalist who supplies old funds. Thus the Waters’ dissertation says much not only about Schumpeter but also about Bill himself. His dissertation is his only book-length publication.     

The duty of the firm in selling to the poor: A question of the person,justice, and subsidiarity

Mainstream economists do not address the question of the duty of the firm in selling to the poor. To them the issue is normative, and they have taken pains to delimit economics as a positive discipline. They separate value and fact, and engage themselves in questions relating to what is and not what should be. Forensic economists hold a different view. Firms are liable for damages due not just to deception and fraud but to negligence as well, and governments have consumer protection agencies to examine cases involving the duty of the firm well beyond deception and fraud. Social economists reject the argument based on libertarianism and individualism that the firm has only one purpose: increasing shareholder value. Social economists view the firm as having several constituencies — shareholders, managers, workers, customers, suppliers, neighbors, partners — and duties associated with each one. Those duties are grounded in the virtue of justice: to render to another that which is owed. The firm has a duty to its customers, its suppliers, and its employees deriving from the principle of equivalence; to its shareholders and employees from the principle of distributive justice; to its competitors and neighbors from the principle of contributive justice. This article argues that the firm has a special duty in selling to the poor which is grounded in the person of the one who is poor, the three principles of economic justice, and the principle of subsidiarity. Mainstream economists address poverty apart from consumer behavior as if the two were unrelated. This article brings the two together and in so doing helps throw light on the question of the duty of the firm in selling to the poor.