Econintersect: Every day our editors collect the most interesting things they find from around the internet and present a summary "reading list" which will include very brief summaries (and sometimes longer ones) of why each item has gotten our attention. Suggestions from readers for "reading list" items are gratefully reviewed, although sometimes space limits the number included.
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Articles about events, conflicts and disease around the world
As Tons of Bug-Infested Rice Rots, El Nino Threatens More Damage (Bloomberg) A rice glut that sent prices slumping more than a year ago is shrinking, just as El Nino arrives to parch paddies across Asia. Global inventories were already heading for an eight-year low, including stockpiles so spoiled that top exporter Thailand may sell most for industrial use. Now, the first dry-weather pattern since 2010 is threatening crops in the Philippines, Indonesia and India. Follow Sig Silber's weekly global weather and climate report to keep up with what happens with El Nino going forward. Note graph below which shows the historically unusual (recently) situation of a rice production deficit at the present time. See also next article.
The China Bubble is Going to Burst (Bloomberg) It’s no longer a question of whether China’s stock-market rally is a bubble, but when the bubble will burst. That’s the refrain from a growing number of analysts as valuations climb to levels that by some measures already exceed the peak of China’s last equity mania in 2007.
Chinese Uber Rival Will Raise Funds at $15 Billion Valuation (Bloomberg) Taxi applications backed by Alibaba Group Holding Ltd. and Tencent Holdings Ltd. are seeking to raise funds that value the company at $12 billion to $15 billion, people familiar with the matter said. Xiaoju Kuaizhi Inc. is raising at least $1.5 billion to fend off Uber Technologies Inc. in China.
What was the wealthiest society in history, with the least income inequality?(Quora) Answer from Prof. Alex Tabarrok, Professor of Economics, George Mason included the following graphic. There appears to be a trend from upper left to lower right. However, even through we do not have the raw data to calculate the best fit regression line (trend line) we can make a judgmental estimate that the correlation coefficient would not be sufficiently large to convince us of the quality of the trend line. (We would want greater than 0.7 to feel any confidence that there could be a primary relationship between decreasing inequality and GDP per capita; and R > 0.8 for more reliable result. We would be very surprised to find that R > 0.5 for the scatter displayed.) However there a pattern in the data which encourages us to think there might be such a relationship. In the second graph below we have drawn the boundary lines for the scatter plot data and these boundaries do suggest a possibe relationship is contained within the data but overall correlation may be diminished because of additional variables not controlled across all the data point conditions.
Other Economics and Business Items of Note and Miscellanea
Richard Thaler and the Human Side of Economics (Bloomberg View) Thaler began his career as an economist who asked the sorts of questions that gave his academic advisers fits. He was fond of identifying where actual human behavior differed from how economists theorized people behaved. The distinction between real people and homo economicus was so stark that a new field of economics was born. His new book, "Misbehaving," documents the rise of the field he helped found. Listen to a Barry Ritholtz interview.
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