The thing that you have to understand about Economists is that they’re generally an optimistic bunch, but they’re really annoyed by the complications of…reality. They love models: models are perfect and simple. Because they omit externalities and oddities, they work perfectly. The simplest of models involve but two variables: wine and cheese, money and time, socks and shoes, and so on. As you progress further in your studies of the dismal science, you must heartbreakingly accept that in the real world, there is almost no application for a two-variable model.
It’s heartbreaking because in the sterile simplicity of Economics, the world works perfectly. Everyone who wants a job, has one; everyone who wants to borrow money, can; if you want time off work, you just work fewer hours. In the world of Economics we are all Utility Calculators, and we’re very good at what we do. We scan the job market for opportunities, spot them, and train to be the next Michael Jordan, Bill Gates, or Homer Simpson, depending our utility/salary demands (shockingly, no one ever chooses to be homeless, or a drug addict, or unemployed in this model).
In the world of Economic models, not only do we all have jobs, but we all have jobs that we’re good at, so we make a lot of money. On top of that, we enjoy our jobs. In other words, if you simplify the model enough, you can actually create the conditions for perfect Human Capital Allocation.
My point is this: there are a few differences between the skills in this world, and where they are most needed (likewise, the low-skill human labor, and where that’s needed). It’s just of a pain in the butt that these two groups can’t find each other more easily. If they could, so theorizes Robert Guest, we could solve most if not all of the world’s problems. In a perfect Economic World, every product has the perfect price, there is no Economic profit, and everyone is maximizing their happiness. How adorable.
This is a book about the growing importance of Diasporas, and what it means for all of us (regardless of which country we hail from). So what’s a Diaspora, anyway?
1.any group migration or flight from a country or region. Synonyms: dispersion, dissemination, migration, displacement, scattering. Antonyms: return.
2.any group that has been dispersed outside its traditional homeland, especially involuntarily, as Africans during the trans-Atlantic slave trade.
So what happens when the simplicity of Economics smashes head on into the stone cold reality of governments, politics, culture, religion, racism, language, and other barriers? Koreans can work in the USA if they’re willing to learn English and speak it 24/7. No shock there. Americans can work in Paris if they can learn French and take up smoking. Anyone (for example a Mainland Chinese) who doesn’t have the right Passport, can’t leave the country without an invitation letter from Harvard. So, this is the world we live in: some privileged few can re-allocate their Human Capital if they’re willing to overcome real barriers, but many cannot. Robert Guest (big shot at The Economist) is suggesting that if we didn’t have…er…countries, we wouldn’t have all these problems. You could take it a step further and suggest that if we didn’t have ownership/territory/property and all the resulting wars, the world would be a much nicer place. But that isn’t going to happen anytime soon either. Once again, the model, beautiful as it is, crumbles when we touch it with our clumsy human hands.
Real Economic development still comes from the top: great countries with great leaders instilling the big three (education, health and wealth) in a populace in a balanced distribution. But there are a few things we can spread across the world without a visit to the Chinese Consulate: ideas (this might explain why some of the most totalitarian states monitor and block Internet access to ‘radical thinking’). The great thing about Diaspora Networks is that they’re usually made up of the best and brightest. The Mainland Chinese who got into Ivy League schools still make up some of the brightest the country has to offer. With their experience abroad, they represent a fine blend of East and West. They can pick and choose what they like and what they don’t like about both. And maybe, just maybe, they can return to their home country and report, and share, and improve things. For that there are three requirements: first, you must leave your home country; second, you must return to your home country; third, you must love your home country enough to want risk everything (your career, your family, your friendships) to change it.
“Currency Wars” by James Rickards (Review)
“Grand Pursuit: The Story of Economic Genius” by Sylvia Nasar (Review)
“Exceptional People: How Migration Shaped Our World” by Ian Goldin (Review)
“Models.Behaving.Badly” by Emanuel Derman (Review)