Tuesday, October 03, 2006
My five day econometrics examinnation is going to start in 50 minutes. I'm shitting in my pants. Going by my earlier exams, it would imply I'm going to be staring at the questions for 3*40 hours instead of 3. The Macro paper yesterday was just brilliant. I've never faced such a challenging paper in my life. Not even those olympiads I used to take in Bangalore..But it was fun nonetheless. I required thinking. That I might get a zero is a good possibility, but then as some dumbass(who never gave Prof Hoon's Macro paper's) said".."It's not whether you win or lose, it's how you play the game"..
[Please skip this portion, until the end..it's dead boring]
Oh Economics is such a wonderful subject. You always work at it backwards. For example, after a great deal of calculation, the equations in the end show that the level of Capital per labour, the wage rate and the effective wage rate are all independent of this thing called "theta", which denotes the proclivity to consume more and more leisure.
After the math is done, some of us more used to equations than intuition are fairly happy..Until, some who generally prefer math to accompanied by intuition, ask,"But why should it be independent of theta". This is where the gas begins..
It's a lot of fun coming up with various hypothesis:
1) there is no direct relation and that is all that counts.
2) An indirect relation exists and must be accounted for..so in that case maybe it's a set of two opposing forces that cancel of the effect of theta
3) Assuming the second to make more sense, go ahead in more and one way to "invent" the two opposing effects.
As lets say leisure increase,more people at the beach than in the office, implies, supply falls, implies, wage rate increases... therefore as theta rises, wage rate rises.
Now, what could possibly be the reason for an opposing effect. Start theorizing again. What variable have we left out?..interest rate!! technology shock, theta rises,leisure rises, interest falls, MPK falls, Investment falls, demand falls, wage falls..AHA!!
This is how most of economics works. You figure what it is you want to prove and there's such got to be a way to do it.
30 mins for Exam to start. I really ought to be revising..
Like yesterday, Martin(my cubicle neighbour) and I were walking back home and as usual disagreeing about something. It started with how marting eats an egg in the morning everyday. I said the yolk as cholestrol, which is not good for the heart. I said at home we always throw away the yellow.
He gave the usual, we should not waste things when there are so many poor. I said inaddition to it being wierd to give just the yellow to the poor, I always believe, that if you've paid for it, whether the thing goes into the bin or your body, economically speaking, it's the same, it's not wasted. You paid for it!
Then that started a discussion on capitalism etc. Then surprisingly he gave me an example, of a story in china where there was a poor family, and it was poor because nobody bought how much was created..so then, it's the circle again. Buy extra,not good. Buy less, not good.
Gotto go catch lunch now.
[Please skip this portion, until the end..it's dead boring]
Oh Economics is such a wonderful subject. You always work at it backwards. For example, after a great deal of calculation, the equations in the end show that the level of Capital per labour, the wage rate and the effective wage rate are all independent of this thing called "theta", which denotes the proclivity to consume more and more leisure.
After the math is done, some of us more used to equations than intuition are fairly happy..Until, some who generally prefer math to accompanied by intuition, ask,"But why should it be independent of theta". This is where the gas begins..
It's a lot of fun coming up with various hypothesis:
1) there is no direct relation and that is all that counts.
2) An indirect relation exists and must be accounted for..so in that case maybe it's a set of two opposing forces that cancel of the effect of theta
3) Assuming the second to make more sense, go ahead in more and one way to "invent" the two opposing effects.
As lets say leisure increase,more people at the beach than in the office, implies, supply falls, implies, wage rate increases... therefore as theta rises, wage rate rises.
Now, what could possibly be the reason for an opposing effect. Start theorizing again. What variable have we left out?..interest rate!! technology shock, theta rises,leisure rises, interest falls, MPK falls, Investment falls, demand falls, wage falls..AHA!!
This is how most of economics works. You figure what it is you want to prove and there's such got to be a way to do it.
30 mins for Exam to start. I really ought to be revising..
Like yesterday, Martin(my cubicle neighbour) and I were walking back home and as usual disagreeing about something. It started with how marting eats an egg in the morning everyday. I said the yolk as cholestrol, which is not good for the heart. I said at home we always throw away the yellow.
He gave the usual, we should not waste things when there are so many poor. I said inaddition to it being wierd to give just the yellow to the poor, I always believe, that if you've paid for it, whether the thing goes into the bin or your body, economically speaking, it's the same, it's not wasted. You paid for it!
Then that started a discussion on capitalism etc. Then surprisingly he gave me an example, of a story in china where there was a poor family, and it was poor because nobody bought how much was created..so then, it's the circle again. Buy extra,not good. Buy less, not good.
Gotto go catch lunch now.
# posted by qq @ 8:11 PM 
