Could You Purchased Knowledge?

Today I finally put aside the unfinished task to chase discounted books at Gramedia Grand Indonesia. The 35 percent discount is just too much too ignored for a bookworm like me. I arrived a bit after 10 am and finish the shopping before Friday prayers so I managed to beat the crowd.















One things that struck me is how books is a elastic goods. There are certainly more than 35 % increase in people coming (and the amount of purchase they make). More like 5 fold increase, and my friends told me yesterday and tonight is even more packed.

Elastic goods should get more revenue if they reduce price by getting larger sales volume. So why the bookstore doesnt hold sales more often?

Or maybe because this feel like a onetime only so people are more willing to splurge on it? Why there is a massive coordination failure when what is needed is to put a list of books we want to buy with friends, pooled our money and take turn reading the book? Where have all the library gone?

Even more systemic, why govenrment not following the steps of India and China by forcing major book published to print the book locally or buy the copyright (yes, some also just ignore it). Thus. reducing the price significantly.

Some people (like me) still believe that buying books will make them more knowledgable. Bad news, only reading will. So asked me what I learn after I finish the pile of books above, if ever.

Death, tax and alcohol

They say that the only certain things is death and tax.

I found an article in Freakonomics blog (click here) that after crack down on illegal trading and closing of an incompetent license holder there is only one legal importer of alcohol in Indonesia

So what happened when a supply is lower than demand? the price increase. In this case, when year end as the excuse of excessice drinking is nearing, four fold. (complete article here).

Another article in CNN report a study between death and alcohol tax (click here). Now we know the price to pay to reduce (alcohol-reated) death.

Isn't economics a great (if a bit gloomy) science?

We can't explain why the story is not reported in Indonesia newspaper though. Please comment and send the link if you find any

Creative monetary policy

Found a 2004 paper with Bernanke (yup, the Fed chairman) as one of co-author.

It listed alternative policy when the rate cut is neither feasible nor having impact (click here to read in full).

America is so lucky to the someone so prepared for the crisis at in charge of the monetary policy. BI still have a lot of ammunition to cut rate but its good to be prepared.

All you need is marketing

The maker of shoes thrown to Bush is surprise to see the demand for Ducati model 271, soon be renamed “The Bush Shoe”, sky-rocketed after the incident.

Click here for the full article in Bloomberg.

The shoe-cide managed to send a sock-and-awe and in-your-face moment in marketing.


P.S.
If you need some weekend diversion, click here or here

Rural is down but even more for urban

Very interesting article in Jakarta Post (click here) by Chris Manning, director of indonesia project at ANU and Sudarno Sumarto, director of top notch Smeru research institute.


The highlight

Overall, compared with 1998, the looming economic slowdown may have a greater impact on less flexible urban labor markets than in rural areas, where small-scale enterprises are much more common.

To Keynes or not to Keynes

Well, the question is more of how much than either-or.

I am arguing that fiscal only interpretation of Keynes is not suitable for Indonesia since we still have room for monetary expansion.Read the article in The Jakarta Globe here.

Too bad the editor cut creative liquidity measures that I proposed.

The Political Economy of Iedul Adha

I am currently reading a couple of Ha-Joon Chang's books. The Korean-born and lecturer at Cambridge has fascinating analysis of globalization today and how we got to it; not by free market but selective industrial policy and protectionism.

In East Asia Development Experience. he cited import restriction of luxurious goods in South Korea as strenghtening national unity and work ethics. The rich and powerful are not seen as splurging with expensive imported goods while the worker is working his ass. The common practice is to used locally produce car as official car of government head (Proton in Malaysia, Toyota in Japan and Hyundai in Korea).

So what Iedul Adha has to do with all the above?

Ramadhan and Iedul adha is an amazing pair. In the first, all eligible population (rich or poor) is going through thirst and hunger together. While on the second, the richer population is getting the poor population some good and meaty meal; it even forbidden to fast on Iedul Adha. How is that for solidarity.

Maybe Indonesia should consider to restrict import of >1 billion car and >10 millions handbags in the spirit of Iedul Adha

US-led Global Capitalism is Dead! Long Live US-Led Global Capitalism!

The first part is the title and opening while the second is the ending line of my today's article in the Jakarta Globe.

The editor change the title and cut the opening/closing line, I guess to make it more sexy and rebelling. Hope the careful reader still get my intended meaning.

The system of buying and selling with market is still the preferred option when it is the best means to increase welfare but stronger transparancy and government regulation is needed more than ever. The same with the role of US, they are still there in pedestal but maybe not much longer if they stumble again.

Roller Coaster, Sutainable & Stability

Indonesia must not have a roller coaster economy,
we need sustainable development"
-Prof Emil Salim in today's FEUI seminar-

"Stability is a public good"
-Title of Tony Prasetiantono's book-