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Thursday, June 29, 2006


Prof. Krishna Kumar, in his adieu mail reminded us of a quote attributed to Confucius:
Every truth has four corners: as a teacher I give you one corner,and it is for you to find the other three.”
One day before the mid terms, I am in a frame of mind where I find it difficult to manage the 1st corner of the "truth", in our case "Global Economics". I was under the impression that Global Economics was relatively easy, until I tried to think deeply into the graphs and curves that describe the nature of macroeconomics.
Jargons are confusing too. For every real X, there exists a nominal X. And to add to the conceptual depth, there will be complicated relationship linking the two. X has a very wide range and can be used to assume seemingly simply stuff like "interest rate" (mind you, seemingly is a very powerful word) to perceptibly complicated jargons like "capital rental rate". Another word which economists have always loved and liked to play with is "marginal". Phrases like "Marginal Product of Capital" and "Marginal Product of Labor" have proved to be very powerful in explaining various global concepts related to capital and labor.
Certain concepts like "Convergence Effect in the Solow Framework", Cobb-Douglas Production function, Ricardian Model of Trade" have made economics look like more of Mathematics to me.
But one thing, that is so striking about Economics is the depth of the topic and its power to explain every minute phenomenon that is visible in global environment.
Really interesting subject..... I am sure my search for the other "three corners" will continue even after I leave ISB.

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