This Is Tomorrow – Day 3: Economics
Economists don’t eat pastries; they have “morning goods” instead. A stack of them – muffins and mini-croissants and fruit Danishes – sits on a table next to the obligatory iron coffee pot and yet another bowl of UHT milk sachets.
This is the other side of This Is Tomorrow: serious eating and drinking. Every night, after a whirlwind day of big ideas, there’s a hefty three-course meal with a selection of academics we’ve met that day. Three days down the line and the worry is that both our brains and our stomachs might burst.
However, these dinners aren’t merely cavalier indulgences at which taxpayers’ money is scoffed and guzzled. They’re also a crucial part of the whole process. It’s here, at the dinner table more than in the department, that the day’s ideas start to concretise, conversations begin to flow both ways and laughter – more of a social lubricant than even alcohol – gets shared.
Because the days themselves are quickfire, dizzying headspins made jittery by excess caffeine. One minute you feel as if you might just have half-grasped a concept and the next you’re swimming around in another, frantically trying to get to grips with a new set of heavyweight terms and a new presence in the room. None come thicker and faster than Economics. Every half hour, bang on the dot, another economist comes through the door, with their own set of ideas to impart. It’s a conveyor belt that never lets up for a second. Overrun – as we inevitably do, trying to snatch questions at speed – and any hope of a break evaporates. While this isn’t a typical day in the department, it nevertheless seems like a world run to high-pressure targets. One of the lecturers is still talking as the door half-opens – only as far as it needs to, mind – and the authoritative voice of Abhinay Muthoo, head of the department, booms in: “Rocco! You need to come now.” Bring on the next economist.
That’s how it feels; like a headless interview process, like Dragons’ Den in double-time. Academic enters, waits for a colleague to finish, plugs in a laptop, delivers a lecture, takes questions and disappears. Bring on the next economist. I suspect, beneath the expediency, there’s a little bit of fun being had: a policy to bombard the artists, see how much they can take, see when they pop.
In fact, there’s a lot to be said for that. After all, it’s what makes an impact that’s important here, what sticks around in someone’s mind. They won’t all end up working with every academic met and every idea delivered. What fades from view later on isn’t really important here. What sticks around, what scratches away for weeks on end might just be. At some level, this week is about ideas competing, jostling and entwining in artists’ brains. So, for all that it’s hard going and the lack of processing time is frustrating, that’s part of the week’s design. Eat now. Think later.
Now, we shouldn’t be surprised by the brutalist efficiency of the economics department. The day starts – after coffee and morning goods, of course – with an introduction to the subject from Muthoo himself. It’s as surprising as it is commonsensical. “Economics is not about money,” he starts with a bombshell; a perfectly provocative pitch opening, one that instantly grabs your attention by inverting a received idea. Instead, it’s about the allocation of finite resources. Apply that to the day in his department, without a second left to waste, and you start to see what’s going on.
But, hang on, Muthoo could also be talking about drama. Finite resources plus excessive demands equals conflict, right? And, as every A Level Theatre student knows, drama equals conflict too. “Every single thing he said is in the play I’m making and I had no idea it was about economics,” Alecky Blythe says, with a note of astonishment. That’s the thing with economists; they’re academic imperialists. “Any arena of life,” asserts Muthoo, “we’re there.” That’ll be expressed in a slightly different way later on by Robin Naylor. He emphasises the aggressive or invasive quality implied as well as the all-conquering ubiquity that results. (Is that the same aggression that exists in our relentless schedule? Is it the same aggression that leads Irene Ng’s corporations to horizontal expansion?)
So, that machine-gun schedule. Here goes:
It starts in the Soviet Union, with Mark Harrison on the economics of a society that prizes secrecy. “There is no right to know. There is only need to know.” Secrecy is both effective and inefficient. It works, but spools layer after layer of costly bureaucracy to check up on the secrecy of secrets. It’s the human edge to this, unsurprisingly, that excites some: What did those little chats about loyalty entail? How do you bring up your kids? But what are the implications of costly secrecy against our society’s giving data away so freely.
Bring on the next economist. Thijs van Rens. Unemployment. Economics often assumes people are the same. They’re not. We retain some choice over our work, albeit affected by the need to earn. Most models, therefore, assume that unemployment is also a choice: I don’t want to work in x, so I abstain. But what if I’m not cut out for or don’t have the requisite skills for x? Why, in other words, don’t unemployed construction workers retrain as much-needed nurses? Incentives – the wages aren’t high enough to outweigh the benefits of pay in construction, even if only employed half the time. Charlotte Vincent challenges van Rens on his choice of image: a white male YMCA-style builder and a black female nurse. It’s strange because they’re singing from the same hymnsheet. Van Rens distinguishes between the positive market (ie as is) and the normative one (as ought). The market sometimes needs correctives. Raise nursing wages.
Bring on the next economist. Rocco MacChaivello. What role does trust play in transitions? To be honest, at this pace, three days in, you have to make some choices. Are you in or are you out? With this much information – all of it new, some of it totally alien – flying your way, you can’t be in at all times. We end up doing shifts; sitting forward, sitting back based on whether something clicks. This time, I’m out. Charlotte Vincent isn’t, though. Nor is Alecky Blythe. MacChaivello’s research into the coffee trade matches some of her own. Our ways in are often through personal experiences: ex-partners, old projects, friends. The door opens just as much as it needs to. “Rocco! You need to come now!”
Bring on the next economist. Robert Akerlof and I am SO in. What role does anger play in the cycle of economic decision-making? Muthoo had warned us at the economists were starting to factor in emotion. Theoretical economics might think in terms of pure, unfettered rationality, but humans don’t make decisions like that. Understand how we make decisions, what corrupts that pure reason, and you enhance your algorithms. Akerlof, who must be the chirpiest person ever to have studied anger, is doing just that. He talks in dressed up formal logic. Player one follows a rule. Player two enforces a rule; a behaviour based on whether he or she thinks player one has behaved reasonably. Player one’s compliance is based on two factors: the cost of compliance (ie how easy is it to comply) and the cost of non-compliance (ie what do I stand to lose by non-compliance). Then, you can chuck in a sense of duty – ought I to comply. To player two, add the possibility of anger, making punishment of irrational non-compliance more likely. Anger then increases compliance. However, if player one feels he or she has been unfairly treated, punished excessively or irrationally, you end up with a vicious cycle, a feud.
It’s interesting that the artists need concrete examples here. Alecky Blythe asks Akerlof to apply it to the riots. What, I wonder, does it infer about banker-bashing: public anger over the economic crash? That anger isn’t connected to the ability to punish – it’s both a (weak) form of punishment in itself, pariahship, and impacts on the enforcer’s decision-making process. But then time’s up.
Bring on the next economist. Kimberley Scharf on the economics of charitable giving. At first I’m out, but it hooks me back. Turns out that the more Facebook friends you have, the less money your online charitable campaign will pull in. What emerges is a fascinating sense of churning data around to explore different factors at play and how logically one set of data leads to another. Does this mean that two marathon applicants with differing numbers of Facebook friends will have different chances of securing a place? In short, yes. But it’s also interesting how much data is missing; how much we can’t quite conclude just yet.
Bring on the next economist. Emotions again and Daniel Sgroi on happiness. In a photonegative of chipper Akerlof, Sgroi cuts an ironically gloomy figure at first glance. He turns out to be coyly amusing. Anyway, he uses us as subjects – dishing out a survey to rate our own happiness, height and political slant in relation to the rest of the group. Flawlessly we prove the theory; that one assumes others to be like ourselves. Secondarily, he demonstrates his current research into happiness and productivity. Show people a comedy clip and, generally speaking, they get better and faster at mental arithmetic. Who knew? Hold up; here’s an argument against arts funding cuts if ever there was one.
Bring on the next economist. We’re running late and the turnarounds are speeding up. Michael McMahon on the who, how and why of monetary policy. It’s the first time economy proper – Newsnight’s economy – has cropped up. McMahon, a brilliantly engaging teacher (the department’s best, apparently), runs us through how inflation works. Printing money reduces the value of money. Only the government benefit, turning out a £50 note for a cost of 5p – good return. He runs us through hyperinflation in Zimbabwe, when inflation rose to 98% per day. At that rate, it matters whether you get paid at 3pm or 4pm. Schoolkids skip school to pick up their parents’ paychecks and immediately run to the shops. A half-hour delay has tangible effects on how much you can buy. In two years. In 2007, you could get a $1,000 bill. In October 2008, a $50,000 note enters circulation. Three weeks later, $1 million. A month on, $100m, then, 8 days afterwards $500m. A week later, it’s up to $10bn, then $50bn a month after, and only four days later $100 trillion. Just as they’re about to produce a $200tn note, the currency is scrapped. Astonishing.
Bring on the next economist. Robin Naylor steps in. He’s got no PowerPoint and no plan. He wants to let us step outside the information overload. He wants to know how we would like this session to run. He talks about grade inflation and the reasoning behind positive discrimination in the university application process. Most of us have stopped taking notes by this stage. My memory of the details is hazy.
At this point, I step out to finish writing up the previous day. The rest of the group stay on for another three such sessions. So, in the course of eight hours, 12 academics whizz through their research. I detail this to give a sense of the bombard, of what it was to be in that room, going stir-crazy as argument on argument, presentation on presentation is fired at your brain.
But it’s worth introducing another point. At dinner that evening, Muthoo jokingly looks ahead to any potential collaboration or work that might follow in due course. Economics are ready to give the artists whatever they need down the line, he explains. They’re in. This sort of goes against the core principle of This Is Tomorrow – that the artists are under no pressure to deliver off the back of it. However, it’s worth noting that its economics that have already inspired the first concrete show from last year’s This Is Tomorrow: Theatre Rites’ Bank On It, a co-production between Warwick Arts Centre and the Barbican that kicks off this summer.
So, another concept: Impact. Universities are measured for impact. Departments have to provide tangible effects of their research. The artists are, potentially, those tangible effects. So am I. So is this.
A thought then. If I’m the head of a department, I want an artwork for my impact ratings. I have a single day with the artists – a limited amount of time, a finite resource. So, how do I best allocate my resources. What do the artists need? Do they need to fully understand? No. They need to have their interest piqued. Once. The rest can follow.
So. A strategy. I need to expose the artists to as many ideas as possible. Those ideas need to have the best possible chance of connecting with an artist. I line up the most left-leaning, emotion-heavy, peoplecentric ideas at my disposal, leaving out the dry fiscal policy stuff that’s the meat and veg of economics. Where I stray into that territory, its because I’ve got a teacher engaging enough to make it stick. I limit them to half an hour each – just enough time for a few questions – and I hope that something sticks.
And that, ladies and gentlemen, is Economics.