Monday, August 25, 2014

Pilkington: Economists – An Anthropological View

While Pilkington is a bit leisurely in setting the stage for his anthropological take on the economics tribe, rest assured that the post is both amusing and instructive.
By Philip Pilkington, a London-based economist and member of the Political Economy Research Group at Kingston University. Originally published at his website, Fixing the Economists
Life Among The Econ‘ is a satirical paper written by the economist Axel Leijonhufvud and published in 1973. In the paper Leijonhufvud refers directly the great work of cultural anthropology The Savage Mind by the French Structuralist anthropologist Claude Levi-Strauss. Before moving on to the paper it is probably best to understand something about Levi-Strauss’ work as I think that the content of the paper would otherwise be lost on many economics-oriented readers.

Our Bloomberg Op-Ed: “How Your Pension Fund Became a Casino”

We have an op-ed just published at Bloomberg, “How Your Pension Fund Became a Casino.” The article discusses changes to ERISA, the law that governs how retirement investments passed 40 years ago to professionalize the management of pension funds. Unfortunately, the Labor Department, which administers the law, reinterpreted some of its provisions in 1978 in responses to pressure from the financial services industry to allow pension funds to take greater risks. The piece explains how naive adoption of newer principles of investment, particularly modern portfolio theory, has blinded pension trustees to risks of entire types of complex investment, such as subprime securitizations and private equity, leading to losses and oversight failures.