The Economics of Uncertainty [TTC Video]
13 August 2015, 03:44
Course No 5523 | M4V, AVC, 2000 kbps, 640x360 | AAC, 128 kbps, 2 Ch | 24x30 mins | + PDF Guidebook | 11.13 GB
Economies are deeply complex systems. The global marketplace—even national, state and local economies—involve many economic actors behaving in rational and irrational ways, sustaining a dizzying array of interconnected activity. Because of the number of participants involved in this global exchange, the unpredictability of their actions, and the sheer variety of possible actions, some degree of economic uncertainty is inevitable.
In one of the most dramatic displays of economic uncertainty in our times, a wave of toxic loans almost brought down the American financial system in 2008-2009, and with it jobs and savings. Few experts forecast this catastrophe, which stands as a lesson in the power of economic forces to defy our predictions. This event may have been exceptional, but every day we are all at the mercy of economic uncertainty in matters such as these:
- Stock market: Although the stock market has a long-term upward trend, short-term volatility can wipe out a large fraction of an investor’s wealth in a single day.
- Careers: No job is safe from the constant assault of domestic competition, offshoring, innovation, downsizing, government regulation, and other factors.
- Insurance: The types of insurance products have skyrocketed to the point that you could easily spend all of your earnings to cover possible disasters.
- Retirement: Is your retirement secure if you live to be 100? What if you suffer a debilitating chronic disease? How will your nest egg fare if inflation soars?
Uncertainty also plagues us in smaller ways. For example, everyone is familiar with rising prices, but the Internet now makes it possible for online shoppers to be charged more based on their buying history, adding a new level of unpredictability to pricing. And anytime you hire someone for a service—from roofing to dentistry—you face the principal-agent problem, in which the person hired may take unethical advantage of your lack of expertise.
Indeed, these large and small risks are so pervasive that it is all too easy to conclude that nothing can be done. But economic uncertainty is like the weather: you can’t stop storms from happening, but understanding how and why they happen allows you to be prepared. In the same way, economic uncertainty is beyond our control, but we’re in a much better position to respond if we know what’s happening and why.
In 24 practical and empowering half-hour lectures, The Economics of Uncertainty takes the mystery and dread out of uncertainty, giving you the tools to deal with risk in every phase of your life. Your guide is Professor Connel Fullenkamp, an acclaimed economist and award-winning teacher at Duke University, where he is Professor of the Practice and Director of Undergraduate Studies in Duke’s nationally ranked Economics Department.
Deepen Your Knowledge of Economics
Gearing his presentation to novices as well as those with a background in micro- and macro-economics, Professor Fullenkamp shows that the study of uncertainty sheds light on a wide range of phenomena, including:
- financial markets
- business cycles
- inflation and deflation
- free trade
- strategic thinking
- career development
- family financial planning
The course also introduces fundamental ideas in probability, statistics, and game theory that give deep insight into the world of risk and require only high-school level mathematics. In addition, the critical thinking skills you acquire in The Economics of Uncertainty have broad applications beyond economics. For example, the decision tree approach to problem solving, presented in Lecture 7, can come to the rescue whenever you need to find the optimum path to any goal, whether it is selecting your next vacation destination or choosing the best college options for your child.
Enjoy the Expertise of a Personal Advisor
Governments and large financial institutions rely on teams of experts to steer them through the perilous waters of uncertainty. In The Economics of Uncertainty, Professor Fullenkamp serves as your personal advisor, explaining in detail how uncertainty works and providing valuable tips such as these:
- Think critically: Knowing the two types of probability—frequency-based and subjective—helps you judge the claims of people who appeal to probability to convince you to take a particular action.
- Weigh risk vs. benefit: When you have to choose between risky alternatives, start from the least risky choice and decide how much extra risk you can tolerate for a given amount of increased benefit.
- Mix it up: Since you can’t negotiate prices when shopping online, be unpredictable. Don’t always take the first price you’re offered. Put some items in your shopping cart and then log off without buying them.
- Cultivate your career: Companies thrive by having a comparative advantage over their competitors. Do the same in your job by identifying what you do better than most people. Then cultivate that strength.
Learn How to Survive and Thrive
The trick to surviving and thriving in an uncertain economy is to know the sources of risk and how much of a threat they pose. It also helps to have a guide as experienced, eloquent, and engaging as Professor Fullenkamp, who, in his consulting work, has designed and led training courses for bankers and government officials for the International Monetary Fund in Washington, D.C. With The Economics of Uncertainty, it is your turn to experience his fascinating seminars, covering topics such as these:
- Black swans: Popularized by best-selling author and risk analyst Nassim Taleb, a black swan is a rare, baffling event with great impact. Professor Fullenkamp analyzes the 2008 financial crisis in light of this intriguing theory.
- Asymmetric information: Often one party in a transaction has a monopoly on information—for example, in a used car sale. Discover how this problem affects every sector of the economy through adverse selection and moral hazard.
- Compensation: Getting a job done well is often a matter of how the payment is made and what performance incentives are offered. Evaluate the risks and rewards of several approaches to compensation contracts.
- Gambling: Even if you’ve never bought a lottery ticket or set foot in a casino, you gamble every day. Learn how to address economic decisions with a seasoned gambler’s knack for separating good bets from bad.
One of the most important lessons about uncertainty is that it’s built into the world. At times, the economy may seem like it’s careening out of control, but we are simply living through the fluctuating uncertainties that have always been with us. There’s no reason to despair, since uncertainty is a phenomenon that can be understood and managed. “Knowledge is power,” says an old proverb. After taking this invaluable course, you’ll have the essential background to manage your economic life toward a more secure future.
- Man, Nature, and Economic Uncertainty
- Turning Uncertainty into Risk
- Five Ways to Face the Unknown
- Probability: Frequency or Belief?
- How We Misjudge Likelihood and Risk
- The Reward in Risk
- Decision Science Tools
- Gambling Economics
- Game Theory: Reveal or Conceal?
- Adverse Selection: Hiding in Plain Sight
- Moral Hazard: Whom Do You Trust?
- The Principal-Agent Problem: When Mice Play
- Compensation Traps
- Caring, Sharing, and Risk Bearing
- Mayhem! Insurance Protection
- Uncertainty in the Numbers
- The Business Cycle's Wheel of Fortune
- The Danger of Inflation
- Extreme Markets
- Regulation, Innovation, Excess
- Global Trade in Employment
- No Limits to Growth
- Hedging Business and Personal Risks
- Stress Testing Your Finances
Foundations of Economic Prosperity [TTC Video]
13 August 2015, 03:28
Course No 5642 | MP4, MPEG4, 818 kbps, 426x320 | AAC, 96 kbps, 2 Ch | 24x30 mins | 4.81GB
Prosperity has transformed the world. Defined as the ability to afford goods and services beyond basic necessities, prosperity is now a way of life for most residents of developed countries—so commonplace that few people realize what a rare and recent phenomenon it is.
A mere two centuries ago, most people lived at a subsistence level, in or near the edge of poverty, as the overwhelming majority had since prehistoric times. Then the Industrial Revolution began and per capita income shot up. It is still rising today.
But the story of prosperity is far from simple—or complete. Many people in the developed world fear that their children will be less prosperous than they are. Meanwhile, new economic titans such as China and Brazil enjoy year after year of rapid growth and an ever-rising standard of living. Elsewhere in the world, millions are still trapped in poverty, despite the best efforts of organizations such as the World Bank to help lift them out of it.
Fostering and sustaining economic prosperity—whether at the individual, national, or global level—is a multilayered endeavor that reaches far beyond economics into the political and social spheres. The complexity of the phenomenon raises equally complex questions:
- Why is prosperity distributed so unevenly?
- Why isn’t the path to prosperity predictable?
- What, if anything, can be done to lift more people out of poverty?
Foundations of Economic Prosperity gives you an unrivaled overview of one of the most pressing issues of our day, in 24 half-hour lectures taught by Professor Daniel W. Drezner of the prestigious Fletcher School of Law and Diplomacy at Tufts University. Professor Drezner takes you behind the headlines and into the debates to dispel some common myths about prosperity and get at deeper truths.
In this stimulating, wide-ranging course, Professor Drezner shows that achieving prosperity involves more than economics. Psychology, sociology, political science, and history also come into play. By taking this broad view, he leads you to fundamental insights about how the modern world works and a deeper understanding of the functioning of the U.S., European, Chinese, and other major economies, as well as an appreciation for the special problems faced by underdeveloped nations.
Mysteries and Myths of Prosperity
Foundations of Economic Prosperity begins with an explanation of basic economic concepts. These are then applied to an increasingly wider sphere, covering prosperity on individual, national, and global scales. Noting that prosperity is surprisingly difficult to understand, Professor Drezner addresses some of the mysteries that surround the subject, including these:
- Why England? The Industrial Revolution started in England, but scholars disagree about why, since other nations were also primed for change. Was England’s position in world politics the key factor? Or its institutions? One theory argues that the distinctive demography of the British gave them a crucial edge.
- Riddle of the two Koreas: Few nations vary so radically in prosperity as North and South Korea. Yet both have the same natural resources, ethnicity, and culture. For the first 25 years of their existence, both countries showed remarkably similar growth patterns. What caused them to diverge so dramatically?
- Easterlin paradox: A controversial finding by economist Richard Easterlin shows that there is no correlation between increasing prosperity and happiness in the developed world. How accurate is this conclusion? Does the effect change with levels of affluence? How much happiness can money buy?
In his quest to uncover the principles that guide the accelerating improvement of material life, Professor Drezner also refutes widely believed myths about prosperity, among them:
- Myth—China is prosperous: China is economically powerful, but the view that it is prosperous is mistaken. By several different standards, China is still a developing country, ranking with nations such as Jamaica, Turkmenistan, and Belarus in per capita income, health, education, and other measures of prosperity.
- Myth—Character is all: While individual behavior matters a great deal, people can’t entirely control their own economic destiny. National and global conditions matter. For example, Steve Jobs could not have built Apple Computer in a country that did not offer educational opportunities and a technology infrastructure.
- Myth—Prosperity is self-sustaining: The idea that once achieved, prosperity is self-sustaining is a misconception. Many factors can derail prosperity, from pandemics to financial crises. Professor Drezner uses Argentina as a case study of a once-prosperous nation that went into a prolonged economic decline.
Successes and Failures
Foundations of Economic Prosperity follows dozens of case histories that illustrate what works and doesn’t work in the drive to increase economic growth. A superb storyteller, Professor Drezner reaches back to examples such as the statue-building culture of Easter Island that prospered centuries ago, until its mammoth public-works effort destroyed the island’s ecosystem—a cautionary tale to all developed societies. In another lesson from the past, Professor Drezner describes the economic policy called mercantilism that trapped European powers in growth-killing trade practices from the 16th to 18th centuries.
You will also learn about the following intriguing examples of prosperity won or lost:
- Financial bubbles: The Dutch tulip mania in 1637 saw the value of a single tulip bulb rise to 45 times Holland’s per capita income. The price soon crashed in a boom/bust scenario that has been replayed many times, for instance in the “dot com” bubble in 1999–2000 and the housing bubble that led to the 2008 financial crisis.
- Globalization: The trend toward an integrated world economy is not a recent phenomenon. The era of globalization that started in the 1850s and ended with World War I brought far more dramatic changes than those seen today—in communication, transportation, productivity growth, and financial innovation.
- Politics versus prosperity: After the breakup of the Soviet Union, many economists predicted a bright economic future for Ukraine—because of its well-educated workforce, heavy industry, and productive farmland. But Ukraine did not do well. The missteps made by its politicians illustrate the enormous power of the state to get things wrong.
Prosperity Tips You Can Use
How can individuals capitalize on long-term trends in the growth and distribution of prosperity? Professor Drezner—whose experience extends beyond academia to include positions with the U.S. Department of the Treasury and the RAND Corporation, as well as extensive international travel and consulting—is full of insight on this question. He suggests, for example, that developments since 1980 underscore the increasing importance of human capital over physical capital—the value gained from investing in people over physical assets. Human capital is the product of education in all its forms, from elementary literacy to job training to undergraduate and graduate studies, and it is more important than ever to a person’s economic prospects.
As a start on your own road to greater prosperity, take this step to invest in an unparalleled explanation of the prerequisites to achieve it in the Foundations of Economic Prosperity.
- The Foundations of Economic Prosperity
- Does Economic Prosperity Make You Happy?
- Varieties of Entrepreneurship
- Individual Prosperity—The Developed World
- Individual Prosperity—The Developing World
- Foundations of National Prosperity
- Perils to National Prosperity
- Political Foundations of Prosperity
- Mysteries of the Industrial Revolution
- Sources of Poverty
- Reducing Poverty with Economic Development
- National Prosperity in the Developing World
- National Prosperity in the Developed World
- Can Prosperity Be Lost?
- Inequality and Prosperity
- Globalization and Global Prosperity
- Great Powers and Global Prosperity
- The Washington versus the Beijing Consensus
- Political Challenges to Global Prosperity
- Financial Challenges to Global Prosperity
- Will the Developed World Stagnate?
- Global Prosperity and the Environment
- Ideological Challenges to Global Prosperity
- The Ethics of Global Prosperity
Meaning from Data: Statistics Made Clear [TTC Video]
13 August 2015, 03:19
Course No 1487 | AVI, XviD, 510 kbps, 368x256 | MP3, 128 kbps, 2 Ch | 24x30 mins | + PDF Guidebook | 3.69GB
Who was the greatest baseball hitter of all time? How likely is it that a poll is correct? Is it smart to buy last year's highest-performing stock? Which hospital has the best outcome for a given procedure? When is it a good idea to buy a product's extended warranty?
These questions all involve the interpretation of statistics, as do a surprising number of other mysteries, including: Is the "hot hand" among sports players real? How can you tell if Shakespeare is the probable author of a newly discovered poem? What is a guilt-free way to get someone to admit to cheating? And, how does a tax assessor calculate the market value of a house?
Meaning from Data: Statistics Made Clear is your introduction to a vitally important subject in today's data-driven society. In 24 half-hour lectures, you will explore the principles and methods that underlie the study of statistics. You have probably heard such terms as mean, median, percentile, quartile, statistically significant, and bell curve, and you may have a rough idea of what they mean. This course sharpens your understanding of these and scores of other statistical concepts and shows how, properly used, they can extract meaning from data.
Become Statistically Savvy
These challenging yet accessible lectures assume no background in mathematics beyond basic algebra. While most introductory college statistics courses stress technical problem solving and plugging data into formulae, this course focuses on the logical foundations and underlying strategies of statistical reasoning, illustrated with plenty of examples. Professor Michael Starbird walks you through the most important equations, but his emphasis is on the role of statistics in daily life, giving you a broad overview of how statistical tools are employed in risk assessment, college admissions, drug testing, fraud investigation, and a host of other applications.
Professor Starbird is a master at conveying concepts through examples. Some of these include:
- When is a Lottery not a Lottery? When it is not truly random. The 1969 Vietnam War draft lottery assigned young draft-age men a ranking for induction based on their birthdays, which were placed in capsules and drawn from a container, supposedly at random. But by computing the statistical correlation for the order-of-draw, it's clear that a nonrandom variable was at play. The most likely explanation is that the capsules with the dates were not thoroughly mixed.
- The Birthday Challenge: What is the probability that out of 50 random people, two of them share the same birthday? The chances are much higher than most people think.
- The Chicken Soup Method: How can 1,000 randomly chosen people serve as a predictor for the behavior of hundreds of millions of voters? This is the essence of a political poll, and its effectiveness should be no more surprising than the fact that that a single taste of chicken soup is enough to predict the overall saltiness of the batch, whether the batch is in a cup or a giant vat.
- Beware of Fallacious Reasoning: At the O. J. Simpson murder trial, Simpson's lawyer Johnnie Cochran countered evidence that Simpson had beat his wife with a statistic that only 1 in 1,000 wife beaters go on to kill their wives. Therefore, Cochran argued, there was only a 1 in 1,000 chance that Simpson went on to commit the murder. Professor Starbird discusses the fallacies in this argument, including the fact that a wife was actually murdered in this case, so the relevant question should be: What is the probability that she had previously been beaten?
- Who Really Won the 1860 Presidential Election? Establishing the will of the people in an election can be tricky, especially when three or more candidates are involved. Professor Starbird shows how the results of the four-way presidential race of 1860 can be interpreted as giving victory to each of three candidates, depending on the voting scheme employed. Abraham Lincoln won according to the rules in place, but given other equally valid rules, the victor—and history—would have been very different.
Statistics Is Everywhere
Statistical information is truly everywhere. You can't look at a newspaper without seeing statistics on virtually every page. You can't talk about the weather forecast without invoking statistics. Statistics obviously arises in business and social science but even enters the arts in analyzing manuscripts. And you'd better not go to a casino without understanding statistics. "It's really harder to find somewhere where statistics isn't important than to find the places where it is," says Professor Starbird.
- Describing Data and Inferring Meaning
- Data and Distributions—Getting the Picture
- Inference—How Close? How Confident?
- Describing Dispersion or Measuring Spread
- Models of Distributions—Shapely Families
- The Bell Curve
- Correlation and Regression—Moving Together
- Probability—Workhorse for Inference
- Samples—The Few, The Chosen
- Hypothesis Testing—Innocent Until
- Confidence Intervals—How Close? How Sure?
- Design of Experiments—Thinking Ahead
- Law—You’re the Jury
- Democracy and Arrow’s Impossibility Theorem
- Election Problems and Engine Failure
- Sports—Who’s Best of All Time?
- Risk—War and Insurance
- Real Estate—Accounting for Value
- Misleading, Distorting, and Lying
- Social Science—Parsing Personalities
- Quack Medicine, Good Hospitals, and Dieting
- Economics—“One” Way to Find Fraud
- Science—Mendel’s Too-Good Peas
- Statistics Everywhere