Finance at the speed of light: Is faster trading always better?

Marius Zoican 20 September 2014

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Few activities embraced the computer age so actively as trading. Loud and hectic pits have been progressively replaced by silent computer server rooms. Transactions are no less dynamic for it, however. A London-based trader can buy stocks in Frankfurt within just 2.21 milliseconds.1 Light needs 2.12 milliseconds to travel the same distance. Welcome to the age of algorithmic and high-frequency trading!

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Topics:  Financial markets

Tags:  high-frequency trading, algorithmic trading, technology, liquidity, spreads, price discovery, adverse selection, exchanges, competition-stability trade-off

Endowments for war in 1914

Avner Offer 19 September 2014

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World War I was a mistake. Its consequences were not part of anybody’s expectations (excepting Stead and Bloch 1899) – certainly not of those who set it off, although there was an undertone of fatalism in their decisions (Offer 1995). If one side had possessed an unassailable superiority, then there would have been no call for war. The war’s duration indicates that the sides were matched, that the outcome was uncertain, and that instigating war was therefore a colossal gamble – and, as it turned out, a bad one. The decisions for war were irresponsible, incompetent, and worse.

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Topics:  Economic history Energy

Tags:  WWI, World War I, war, imperialism, nationalism, energy, Agriculture, technology, technological change, innovation, conscription, Inequality, rationing

Why the US and EU are failing to set information free

Susan Ariel Aaronson 14 July 2014

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Tim Berners-Lee, the architect of the World Wide Web, taught us that the internet we have is a function of the choices we (users, companies, policymakers, etc.) make about information flows. For example, in 1995, Berners-Lee chose not to patent his work on the World Wide Web because he feared patenting it could limit its universality and openness. He continues to advocate this. In March 2014, he called for an online bill of rights and created a new organisation to ensure that the web would remain the “web we want” – open, free, and neutral.

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Topics:  EU policies Global governance International trade

Tags:  US, EU, WTO, information technology, trade, technology, internet, Human rights, national security, Information, free trade agreements, data protection, privacy

Are large headquarters unproductive?

Masayuki Morikawa 19 June 2014

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The role of headquarters

Headquarters – the core service sector inside companies – conduct a wide range of highly strategic activities, including:

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Topics:  Productivity and Innovation

Tags:  productivity, Management, ICT, Japan, technology, headquarters, centralisation

Are large headquarters unproductive?

Masayuki Morikawa 26 August 2014

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The role of headquarters

Headquarters – the core service sector inside companies – conduct a wide range of highly strategic activities, including:

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Topics:  Productivity and Innovation

Tags:  productivity, Management, ICT, Japan, technology, headquarters, centralisation

Net neutrality: A simple goal with some difficult implementation ahead

Joshua Gans 11 June 2014

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Net neutrality has a simple goal – to ensure that consumers face an undistorted choice in choosing where to devote their attention on the Internet. The rationale for that goal is to ensure a ‘level playing field’ for those who provide content, applications, or anything else via the Internet.

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Topics:  Competition policy Industrial organisation Microeconomic regulation

Tags:  US, technology, market power, regulation, internet, price discrimination, net neutrality, Federal Communications Commission

Did the internet prevent all invention from moving to one place?

Chris Forman, Avi Goldfarb, Shane Greenstein 23 May 2014

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Reading the technology press, it often seems as if the media think all high-tech invention happens in Silicon Valley. This parochial viewpoint highlights the ‘agglomeration’ advantages that the Valley provides to inventors because so many technology firms are located in the same place. These advantages include easier access to funding from local venture capitalists, sharing of fixed costs such as specialised patent lawyers, and easier exchange of ideas between researchers.

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Topics:  Frontiers of economic research Productivity and Innovation

Tags:  patents, information technology, technology, agglomeration, internet, economic geography, invention

Newspaper readership, civic attitudes, and economic development: Evidence from the history of African media

Julia Cagé, Valeria Rueda 14 May 2014

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Poor governance due to lack of political accountability is often cited as an explanation for the low level of economic development in sub-Saharan Africa. Lack of political accountability can emerge when voters do not choose their candidates according to their expected performance. In sub-Saharan Africa, voters often use the ethnic profile of a candidate as an informational shortcut for the candidate’s political agenda (Ichino and Nathan 2013). As a consequence, politicians rely on tribal allegiances that deliver the votes of co-ethnics irrespective of performance (Casey 2013).

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Topics:  Development Economic history Institutions and economics Politics and economics

Tags:  development, democracy, Africa, religion, technology, media, voting, accountability

US electrification in the 1930s

Carl Kitchens 29 January 2014

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In 1930, fewer than 10% of farms in the US had access to electricity. By the mid-1950s, almost every farm in the country had electricity. While the US was able to extend electricity to its rural locations rapidly over a 25-year period, much of the developing world still remains without electricity today. In 2012, 1.3 billion people lived without electricity worldwide.

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Topics:  Development Economic history

Tags:  growth, Agriculture, technology, investment, subsidies, electricity, infrastructure, electrification

Is technological progress a thing of the past?

Joel Mokyr 08 September 2013

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Technological progress has been at the heart of economic growth for two centuries. Some authors, however, have suggested that product and process innovation are running out of steam:

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Topics:  Productivity and Innovation

Tags:  technology, technological progress

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