ECU'nomist 2015-2016 Issue 2 by Economie Combinatie Utrecht 1992

The ECUâ&#x20AC;&#x2122;nomist February 2016, YEAR 24, ISSUE 2

What on EARTH are we doing? Help! The Robots are Coming! Pretty (expensive) in Pink Drug revolution Taste Before You Waste UCLA Exchange Dr. Loek Groot interview

Letter from the Editor

The ECU’nomist, November 2015

Dear readers, And here we are, rolling into third period and a new year. I hope you all enjoyed the first issue as we’ve put a lot of effort into it. If you’re not already struggling to stay afloat your books, papers, and articles, I sincerely hope this copy of the ECU’nomsit will be a breath of fresh air. But before you start taking paracetamol for the headache and bewilderment ensuing the psychedelicfoodwaste-world-domination-pink-tutu Robot on the front cover–no, it doesn’t bite–I’d like to summarise what can be expected in the following pages. This year’s informal committee theme–aside from pink flamingos and cocktails (see previous issue)–is something I discovered be dear to my heart. We all share a love for music, which is common and yet individual in its detail. Common because a few notes can make us rejoice shoulder to shoulder, hand in hand, and finish the notes into a complete melody. Individual because we all choose the melodies we like best and express ourselves through them. These melodies become rather personal. On that note, below are the article topics of this issue. The first article this issue is written by our very own Aleksander Tase. With COP21 just past, Aleksander writes about climate change and warns us against the future price hike in swimwear and water related toys. Linda Kunertova takes us back to Woodstock and tells a story about the rebirth of research in psychedelics. Research arising from recent government deregulation and reduced stigma. Marouschka Blahetek on the other hand speaks about the colour pink, and how its glamour properties shockingly reflect its price. Have you ever thought/nightmare’d of the world being dominated by Robots? That’s just around the corner according to Sjoerd van Alten, and apparently it will affect all of us. As for myself, I wrote a piece about food waste and a very friendly initiative here in Utrecht and Amsterdam: Taste Before You Waste (TB4YW). A big welcome back to Annette Aprilana, tanned by the warm California sun. Annette was last year’s editor in chief and now that she’s back from exchange, she takes us on a tour of UCLA, so make sure to check the exchange article! As a carry-on guest writer from the last issue, we have Cem Pedrar who writes about Turkey and its love-hate relationship with the European Union. Additionally Sjoerd reviewed the Dijsselbloem event, “Is the Euro back on track?” and as a continuation, you will find some more committee introductions in the University life section. Finally, we’ve dedicated a few spreads to Aleksander Tase for his photographic debut. Aleks’ Utrecht Street Photography will be available in the middle pages so take them out of the issue and hang the photos up on your wall. It’s really exciting to see the ECU’nomist take shape this year, especially because this is the most content we’ve had in the magazine thus far. Working to create harmony takes effort, but once you start listening to each other you hear the results, and they sound pretty good! I will be Bach,

Filippo Ricci, Editor in Chief

Letter from the Board

The ECU’nomist, November 2015

Dear readers, The second period is completed and you have finished your exams . We hope that you passed all your courses with good grades. If so, come celebrate with us on the Karaoke B.O.M.B. on the 8th of February and if not, come drink and sing away your tears with us. For ECU’92, the exam period and the retake week mean weeks of peace and quietness. In these weeks we are preparing all the events that are still to come, such as the Conference on February 17th, an honours activity, drinks, dinners and the Dies festival from the 21st till the 24th of March to celebrate our 24th birthday! Halfway through the academic year, it is time to draw up the balance. During the next weeks, we’ll be evaluating the past half year and write our semi-annual report. Then we’ll look forward and think of new ways to organize the best activities for you and to represent your rights at the university. Besides, we try to broaden the supply of career events by involving small and medium enterprises and by offering you soft skill workshops. We’re open to all ideas that increase the attractiveness of your membership at ECU’92. It seems that every day it gets more important for individuals, businesses, institutions and associations to work together. Increasingly more activities such as lectures, career events and parties are organized in collaboration with other organizations. At ECU’92, this is reflected in Project SiX on the 12th of May, the REBO career nights from the 23rd till the 26th of May and the lasting collaboration between U.S.E. and ECU’92. Luckily, the current Board of ECU’92 is a board that likes to work together and meet new people. If you’re in an organization or you have a plan that concerns ECU’92, feel free to talk to one of us to find out what’s possible. To end my introduction, on behalf of the 25th board of ECU’92, I want to wish you a successful and instructive third period. Once more, I want to invite you to the Dies Festival to mark the 24th birthday of ECU’92. We offer all kinds of different activities, free lemonade, coffee & tea and on the 24th of March (the date we were founded) we hand out free pie. Mark this week in your agenda, because there won’t be any time to study.

On behalf of the XXVth Board of ECU’92,

Luuk Wagenaar Chairman ECU’92

Contents

The ECU’nomist, November 2015

The World

Food for Thought

6 8 23

To trip or not to trip? Taste Before You Waste (TB4YW) Pretty (expensive) in Pink

Lecture: Jeroen Dijsselbloem

Current Affairs

Is the Euro back on track?

10 On the cover: Our friendly robot represents the articles featured in this issue. Environmental damage, world domination, drug research, gender marketing, and food waste.

Help! The robots are coming!

Europe and the World

What on EARTH are we doing?

Interview Loek Groot:

Dr. Loek Groot explains post-productivism, the Welfare State, and BI.

Guest Writers

Turkey vs. the EU

Following COP21 there was consensus, but that might not be enough for Earth.

Post-productivism, the Welfare State, and Basic Income

University Life

Exchange Story:

California: UCLA

Committee Introductions:

OpenMic Club ECU’92 Honours Discussion and Lecture S.E.C.U. StudyTrip Conference

14 Utrecht Street Photography 12 ECU’92 photo page

The rebirth of psychedelic research which was due decades ago.

www.ecu92.nl ecunomist@ecu92.nl Published by Issuu

Europe and the World

The ECU’nomist, November 2015

Current Affairs

What on EARTH are we doing? A story about climate change Aleksander Tase

ACH GENERATION OF HUMAN HISTORY HAS HAD MAJOR CHALLENGES TO OVERCOME, in some cases them being the main driver of ingenuity and political awareness which have brought development to society as a whole. The World Wars, The Great Depression, cultural battles, sociopolitical transitions, all influenced and in a way defined generations of the past which had to overcome great hardships and be uniquely ingenuitive. Those ancestors are etched in our collective memory as inventors and revolutionaries, warriors and leaders, all shoes which we might be reluctant to fill considering the easygoing, high-speed lifestyle of our generation Y. In fact, under the protective wing of newly established treaties and unions such as Nato, European Union, United Nations and many others, the possibility of chaos and disruption as our great-grandparents knew it is far from likely; the world seems closer than ever! But what must be realized is that our predecessors were all fighting temporary social battles, lasting at most decades and requiring individual perseverance, all the while contributing little by little to the first truly unique (not in a good way) problem plaguing a human generation; the environment and climate change. So don’t worry fellow consumerist generation sharers and gas guzzling graduates, not only do we have an issue to worry about and solve, but it’s going to take more than weapons and wars, and best of all; it’s a present from our ancestors! I say we’re faced with a unique challenge because for the first time in our history it’s not merely a matter of current social-eco-

nomic prosperity or safety. It’s a non-social problem begging for long-term thought and solutions, something we’re not very good at comprehending in the first place, let alone cooperating to solve. Since the industrial revolution we’ve burned fossil fuels, cut down trees and just about indulged ourselves in every natural resource the earth’s buffet has to offer like it’s the end of the world (literally). The so called greenhouse gasses which are our way of contributing to global warming have more than doubled since the invention of the locomotive in 1804 and the main contributor to their release, fossil fuels, contribute to 95% of most country’s energy needs. According to the World Resources Institute, more than 80% of the world’s forests have been destroyed (which ironically use up greenhouse gasses), the average global temperature has increased by an amazing 0.7 degrees. Sea levels have increased by 25 centimeters and are accelerating fast (bad news low countries) It’s pretty obvious that we’ve acted as a virus to the planet, not understanding that by harming the natural environment which we have distanced ourselves from, there will come a point where our way of life will be in jeopardy as well. But how will we feel nature’s bite first? Its human nature to understand the full scope of the issue at hand only after it has some real context or coherence in our own lives. Taking a European perspective, I’ll assume no actions are taken towards helping climate change and people have to miraculously adapt to the new circumstances of a hypothetical future in only 100 years. The ice caps have potential to raise sea levels by 7 meters

Europe and the World

The ECU’nomist, November 2015

and assuming they do, we’ll have to say bye to Denmark, Venice, the Netherlands and about 10% of the rest of Europe, so be ready to move because real estate prices are going way up. Global warming is likely to increase the number of “climate refugees”—people who are forced to leave their homes because of drought, flooding, or other climate-related disasters. Mass movements of people and social disruption may lead to civil unrest, and might even spur military intervention and other unintended consequences. When thinking of a place to move, imagine that what is considered the Mediterranean today, will be a massive sand-covered dry beach with practically no rainfall, only suitable for winter trips and solar panels (which we should have thought of utilizing sooner). That leaves everything south of the Alps only suitable for camels. So say hello to your new home; the beautiful warm beaches of the Scandinavian or the Mediterranean areas of Northeastern Europe. Assuming you’ve found a place to live which isn’t underwater or affected by constant sandstorms, it’s probably time to start looking for a job. With the current economic development and population increase, it’s estimated that the world supply of crude oil will run out at about the year 2080 (tough luck Shell). This means no cars, planes or globalized economy in any way. Every man is for himself. The best choice is to be a farmer in this out-of-necessity agrarian society. With most grape producing areas now out of the picture, it seems bleak for the future of the wine industry. Though wine is not essential to human survival, wine is an important product of human ingenuity. All agricultural activity is decidedly dependent upon and inherently interconnected to climate and weather; grapes are no different. Though grapes are grown worldwide, premium wine grape production occurs within a very narrow climate ranges. Unfortunately this climate range has now been turned into a desert, but not all is lost. An area ranging from the Alps to Poland and into mainland Russia is now the new Bordeaux of Europe! Europe isn’t seeing its brightest days. A dystopian, agrarian society of anarchy fueled by constant wine drinking because not much else can readily be produced in the once fertile continent. We all know such a future for the most “intelligent” species on earth isn’t likely to happen. But how can it be stopped? Last year in December, the United Nations Climate Change Conference (COP 21) was held in Paris. The conference negotiated the Paris Agreement, a global agreement on the reduction of climate change, the text of which represented a consensus of the representatives of the 196 parties attending it. The agreement will become legally binding if joined by at least 55 countries which together represent at least 55 percent of global greenhouse emissions. The

agreement is unique because for the first time it sets legally binding rules even to the top economies of the world, assuming it is ratified. According to the organizing committee at the outset of the talks, the expected key result was an agreement to set a goal of limiting global warming to less than 2 degrees compared to pre-industrial levels. The agreement calls for zero greenhouse gas emissions to be reached during the second half of the 21st century. In the adopted version of the Paris Agreement, the parties will also “pursue efforts to” limit the temperature increase to 1.5 °C. The 1.5 °C goal will require zero emissions sometime between 2030 and 2050, according to some scientists. Although many countries are starting to see the light and the general outlook is towards mending what we have caused, it’s the top polluting countries (which also “coincidentally” happen to be the ones with most economic power) which have most say in the future of the environment. The turning point came in another momentous meeting where President Obama and General Secretary Xi Jinping agreed to limit greenhouse gases emissions, setting the example for many other polluting states. Although faced with one of the most complex problems, brewing for many generations in a row, and looming over the future of a grim lifeless planet, I have faith our ingenuity will not fail us yet. Utilizing alternative energy sources and sacrificing a little luxury is something many European countries are doing already in hopes for a better future. And the future does look bright, after all, it would be very sad if the demise of such an intelligent society came from just that; its lack of intelligence.

“The ice caps have potential to raise sea levels by 7 meters and assuming they do, we’ll have to say bye to Denmark, Venice and the Netherlands”

Europe and the World

The ECU’nomist, November 2015

Current Affairs

To trip or not to trip?

The revival of the research of pychedelics as a medical treatment Linda Kunertova

S IT HAPPENS TO BE, after decades of absolute institutional disapproval and strict restrictive laws we might finally be standing on the frontier of a fantastic psychedelic revolution and a renaissance of extensive psychedelic drugs research could be within the reach. A recently published extensive text about psychedelics in The New Yorker magazine, reviewing, summarizing and contributing to the most important experiments and lab testing carried out in the sixties during the times of the ‘drug revolution’ and hippie era, has stirred up a debate about the magical potential these substances have to offer. The topic has been heavily discussed in academic fields for years, but has started taking shape just now within broader society. More and more scientists agree that psychoactive drugs could become a groundbreaking asset in a clinic mental-disorder treatment. A considerable number of experiments and studies taking place throughout the world is now re-examining the medical benefits of substances like LSD, psilocybin or ketamine. The variety of mental diseases that could be supposedly curable by

psychedelics ranges from different kinds of psychosis, clinical depressions, addictions or anxieties to cluster headaches. So far the ongoing medical studies have brought nothing but positive, if not astonishing results. Ketamine proves to have an exceptional alleviating effect even on patients suffering from such depressions that cannot be treated by standard antidepressants. Hallucinogens such as LSD and psilocybin, a compound which can be found in magic mushrooms, have been tested in dozens of clinical trials as means of anxiety and existential stress relief for patients diagnosed with cancer. In the experiment participants were carefully examined in order to eliminate risk of a negative reaction to the drug and prevent them from a ‘bad trip’. In some extreme cases, the presence of psychedelics in the organism can even activate schizophrenia, that’s why a primary screening and therapeutical supervision is necessary. Those who met the requirements received a single dose of psilocybin and were observed during the whole process while the body was getting ‘intoxicated’ by the psychoactive substance. The results were incredible. Due to the chemical composition

of hallucinogens someone’s reaction to them cannot be predicted and is rather individual; however, overwhelming majority of the patients described their experience as something unique, lifechanging, mystical and highly spiritual that altered their lives in a profound way. Many cancer patients reported that during their trip they had encountered their illness and death itself, which subsequently helped them to reconcile with their diagnosis and to reach peace of mind. Those who were terrified of death stopped worrying. Although all the participants experienced and were confronted with different visions and psychedelic journeys, they all came down with an intense feeling of spirituality and better, if not complete, understanding of their existence. LSD is believed and proved to have the same, maybe even more excessive effect. Similarly, researchers are planning to test psilocybin as an alcohol and smoking addiction treatment, and judging from the excitement, the phenomenon arouses amongst scholars and scientists. It’s presumable that once this revolution starts, it will not stop with psychiatric research, but will spread to

Europe and the World

The ECU’nomist, November 2015 other medical fields such as neuroscience. In reality, these discoveries are nothing new under the sun. Looking back to the sixties there are many names associated with efforts to use psychedelics as a medical treatment. A famous writer, Aldous Huxley, the author of the transcendent work “The Doors of Perception” and more famously, his both utopian and dystopian novel “Brave New World”, was the first one to propose such a research project that would involve administering LSD to terminal cancer cases with the hope of making dying a more spiritual process. Another well-known name from the history of hallucinogens is Amanda Feilding. Her passion for consciousness, mysticism and psychology started in her twenties when she was first introduced to psychedelics that shaped the rest of her life. After illegalization of psychedelic drugs, the British aristocrat has spent years on reversing this proscription and formed the Beckley Foundation, organization, which strives to reform international drug poli-

cies in favour of psychedelics as well as to conduct research and collaborate with various influential scientific institutions on experiments with psychoactive substances. ‘The father of LSD’, a Swiss scientist Albert Hofmann, dedicated his whole life to research of the therapeutic benefits of this substance. To prove society wrong when prohibiting it he published hundreds of scientific articles and numerous books regarding effects of psychedelics in psychoanalysis, calling LSD “medicine for the soul”. However from today’s point of view it almost seems like the suppression of the first wave of psychedelics research in the sixties and putting LSD and other hallucinogens on the list of dangerous drugs was inevitable. As psychedelics carried so much unexplored spiritual potential that could positively change lives and improve overall well-being not only of sick patients, but also of ordinary people, soon after their discovery substances leaked from laboratories to the streets and the situation got out of hand.

Within a few years LSD was freely distributed to the crowds at the Woodstock festival and became a widely used recreational drug particularly popular in the movement known as hippie movement. Even though the hallucinogenic substances are not toxic, thus the drugs themselves cannot cause death, their careless usage under no supervision could mean a traumatic or even devastating experience. In other words, not every trip is necessarily a good trip. The threat that these spiritual drugs posed to puritan society accustomed to strict hierarchal structures was too huge to ignore and eventually psychedelics got banned practically in every country in the world. Furthermore, as hallucinogens became associated with the hippie movement whose anti-war philosophy came to the direct conflict with American war policy (the United States were in a war with Vietnam at that time), rather than the dangers of psychedelics, it was a combination of society-wide panic and political reasons which shut ultimately shut down research for the following decades. Society wasn’t ready. A question that arises is: are we ready now? The truth is that after all these years psychedelic drugs are still a taboo. Instead of sensible and factual discussions, most politicians and institutions remain blind to what appears to be obvious. The fact that psychedelic drugs could be a revolutionary contribution to modern medical-health science is inarguable. What we need to do is to step out from the shadows of past, thoroughly raise general awareness so the public will have detailed information about both positive and negative properties which psychoactive drugs possess and figure out the best legal ways and enforcements to ensure that the mistakes from the sixties won’t be repeated again.

Utrecht Food for Thought

Taste Before You Waste Filippo Ricci

S DEFINED by the Dutch government, food-waste is any food that is intended for human consumption but somehow removed from the value/supply chain. Households in the Netherlands buy circa 368 kgs of food annually. Out of these 368 kgs, 19 kgs is unavoidable food loss which means about 347 kgs are edible food. This is the per capita average. Each person wastes about 47 kgs of food per year (32 kgs via household waste, and approx. and 15 kgs arising from other sources of waste—think about all those house-parties). This comes to about 105 kgs per household per year. For the Netherlands, this amounts to .8 billion kgs of food wasted by consumers every year (Van Westerhoven, 2013). And as John F. Kennedy once said “Consumers, by definition, include us all (93 - Special Message to the Congress on Protecting the Consumer Interest. (March 15, 1962). They are the largest economic group in the economy, affecting and affected by almost every public and private economic decision.” Hold it there. I mean certainly we cannot be this

The ECU’nomist, November 2015 wasteful! I’m quite certain that at least I am somewhat doing better than these figures show—psychology tells us that a lot of us think we’re somehow behaving better than the average. What happened there was a behavioural anomaly, I systematically underestimated a negatively valued event (i.e. one which doesn’t benefit but actually reduces welfare). This kind of anomaly is not uncommon, even amongst university professors—I’ve seen professors claim they wasted considerably less than the average, and baffle themselves after having calculated how much food they’ve wasted in a given week. I’m not going to delve into how our intuition misfires, because you could write a book on that topic alone—and books have been written. However, I will start by introducing you to the world of surplus we live in as you haven’t experienced it before, and maybe mention how us, the consum-

ers, can get involved into not making things worse and take advantage of this system. Amongst the most wasted products, we have the Dairy “queen”, bread, veggies, fruits, sauces/oils and meats. In last place i.e. the smallest component of food-waste, we have Cheese, which I think says something about the Dutch and their love for cheese. (CREM van Westerhoven, 2013). For those internationals who haven’t seen a Dutchie use a cheese knife, I would highly recommend it. Environmental concerns aside, this food-waste has more implicit prices; Dutch consumers spend an annual €2.5 billion on the food they dump in the trash. This comes to €340 per household and roughly €150 per person (most Dutch households “hold” two people.) (CREM Van Westerhoven, 2013). In developing countries, most of the food-waste happens at earlier stages of the value chain, i.e. produc-

“In the Netherlands, each person wastes about 47 kgs of food per year”

Crates of bananas, tomatoes, and paprika prior to being salvaged. Some stores in Lombok caught on with TBYW and started selling at low prices prior to the veggies’s earthy demise.

Utrecht

The ECU’nomist, November 2015 tion, initial distribution et cetera, whereas in developed countries like the Netherlands, food-waste happens primarily at consumption—don’t worry, you will not get arrested, yet. This means that energy has already been expended into the processing, transport, and packaging. The moment you step into Albert Heijn, Jumbo, Plus, Nettorama and the rest of the merry bunch and reach for those chocolate chip cookies, 85%90% of the energy has already been used. In simpler words, cooking the food at home uses only about 10% of the total energy expended in the food product’s production. Intuitively we can see that our options for recycling are limited, in part due to the size/quantity of food we waste at a

What is being done in Utrecht? After that four paragraph long guilt trip, you might finally be able to read on. Aside from what you can do to reduce your own food waste, Taste Before You Waste started only a few years ago by Luana Caretto in Amsterdam to reduce other’s food waste! The aim of the project was to provide healthy food for free, whilst educating about food waste. The project quickly expanded to Utrecht, starting up from the International Campus. Poppy Phelps, a UCU student from the Utrecht branch explains: “All the food is prepared from food which can no longer be sold, as it no longer meets buyer standards, but it is still perfectly edible.” Francesca Alì, a volunteer and U.S.E. student, explains that today, “the main purpose behind Taste Before You Waste is to raise awareness and educate on the issue of food waste.” This happens namely via internally organized public events such as free food markets at ACU (Apolitiek Cultureel Centrum Utrecht), or organizing a free soup lunch on Koningsdag. They also catered several events at the University College (UCU), Kargadoor, dinners for refugees and even the recent student demonstrations in Utrecht! The idea behind organizing and catering events is that it involves the consumer rather than simply accusing her. It gets people to talk about the issue of food waste whilst they munch away on food which is “too yummy to resist”, as said by Lucille Kok, also from the Utrecht branch. This is a “pretty powerful experience as opposed to simply pointing fingers and hoping to change their behaviour.” After all, it is true that

time; leaving a little “pulp” on the carrot’s butt isn’t that big of a deal in comparison to the inventory losses a supermarket makes… This means that there’s more to food-waste than meets the eye. The energy that was put into its cultivation, packaging, transport, refrigeration, and preparation is all lost. Almost sounds like the reverse of a GDP calculation, instead of adding the value you subtrack all the lost “added” value. This means we throw away energy; to put things into perspective, every kilo of food we dump means we are also throwing away 1.3 liters of petrol (Milieu Centraal, 2012). It would be interesting to see everyone’s behaviour if they could somehow visualize the energy, money, and time that went

albeit we often hear about food waste, we are not always exposed to what is being done about it, and better yet, we are seldom eating a free lunch which increases overall welfare. Ultimately, the problem is overproduction in our society, although TBYW doesn’t tackle this itself as it doesn’t target the structural issues in the value chain. What is being done in the short term is redistribution of food which would be otherwise thrown away. As as a bonus, TBYW enforces everyone’s right to food and breaks the wall of hypocrisy which divides the less privileged from consuming healthy food; they serve “fresh, healthy, vegan food for free and like to support socially responsible events.” What TBYW does do is something that could potentially help Utrecht as a whole. Once a lot of people take advantage of this surplus—namely in Lombok neighbourhood as a lot of supermarkets do not allow their food to be redistributed and is thrown out—the decreased demand for food that stores will face could reduce the size of inventories. This means that hopefully, TBYW will act as a “visible hand” and drive food surplus down, effectively reducing food-waste. Whether this happens or not depends on how much food can be salvaged and how many people actually do take part in this adventure. You can join TBWY’s facebook page to keep in touch, and you can head over to Lombok on a Tuesday or Thursday morning before noon, as the stores start putting their surplus food on the street before it is collected by the Municipal garbage. Will you be the superhero Utrecht needs, or the one Utrecht deserves?

into making our favourite chocolate chip cookies. Considering the climate impact, our three culprits boil down to Meat, Dairies and Vegetables. Vegetables are flown in or grown in heated greenhouses, which has a substantial impact on the climate. These three account for 50% of the total waste on climate. Combating waste on these product groups would mean higher climate benefits. Waste throughout the value chain: FAO studies show us that 1.3 billion tonnes (Billion tonnes, that’s 12 zeros…) which turns out to be about a third of total food production (Gustavsson et al., 2011). Further research by Wageningen University and Research center (WUR), commissioned by the Ministry of Economic Affairs, challenged the previous figures detailed in the article. “The amount of food waste in the Netherlands in 2009 was between 83 and 151 kg per capita and in total amounted to 1.4-2.5 million tonnes.” This figure differs in calculation, as it is inclusive of the whole value chain in the Netherlands (also what is wasted in restaurants, supermarkets, et cetera), while the 47kgs mentioned in prior referred to per capita household waste. The most important finding however is perhaps that, in relative terms, the consumer is the largest food-waste-r throughout the entire value chain—that’s the hippy-police knocking on your door. (Soethoudt and Timmermans, 2013).

Do you want to be part of the next ECU’nomist? Are there pressing issues on hand that you want other people to think about? You can write about interesting literature, inspiring people, current and historical events, anything that the scope of economics encompasses or that you think economists will find interesting. If you are interested, then send your piece to: ecunomist@ecu92.nl Happy writing!

World

The ECU’nomist, November 2015

Food for Thought

Help! The robots are coming!

The economic consequences of massive robotization Sjoerd van Alten

N AS LITTLE AS TWENTY YEARS, the way we produce goods in our economy might be totally different. Staggering progress in especially the field of artificial intelligence and robotics gives reason to believe that in the near future, many of the jobs that now have to be performed by human beings will be performed by robots. In a 2013 study, Oxford researchers Carl Frey and Michael Osborne investigate which jobs are under risk of being completely automatized. They have developed a model to estimate the probability of automatization of 702 widely spread jobs. If you look at the table of probabilities this results in, you must conclude that technological advancement will radically change our world. Imagine a night of clubbing in which your drinks are served by robot bartenders (probability: 0.77), your pizza kebab is prepared by a robot cook (probability: 0.81) and after which you are not taken home by a taxi driver, but in a driverless car (probability: 0.89). All in all, Frey and Osborne estimate that, in the US economy, 47% of all jobs is likely to be computerized within the next twenty years. For Europe this estimation is slightly lower, although still surprisingly high: 35% in the UK and 40% in the Netherlands. All that have seen films like ‘Terminator’, ‘I, Robot’, or ‘Robocop’ will have little reason to cheer at the thought of a world in

which robots play such a significant role. Indeed, much of the breakthroughs happening in the world of AI result from the fact that robots become more and more self-learning, which gives reason to fear that robots could, in theory, become smarter than man. This however, is not a problem that is of concern to economists. Their worry lies in the possibility of the labour market as we know it falling apart. Basically, economists fall into two camps when analysing this problem; there are those that claim that during the course of history, technological progress has always destroyed jobs, but also created new ones in return (Telephone operator is an occupation long forsaken, but call centre operative is relatively new) , and there are those that claim this time will be different. Their main argument is that the few new jobs that are created as a result of computerization and

Graph 1: Average annual hours worked, 1970-2011

robotization (these jobs mainly include ‘supervising’ the robots), require a high level of skills and education that is not reachable for many people, leaving those lower educated people without a possible job. The fear is not only that the many jobless people will be a great burden for society, but also that great inequality will arise, since the gains on capital as a result of robotization will be so much higher than the gains on labour, and it’s the capitalists that will own the robots. Although economists seem to be divided on the upper matter, there is one thing they cannot disagree on: The application of robots will result in an immense boost of labour productivity. Robots can produce and provide services 24/7 and do not complain about colleagues they dislike and therefore would rather not work together with. Furthermore, when designed correctly, they are way faster and precise than us daft humans. Shouldn’t such a huge increase in productivity be considered a blessing rather than a threat? It means there is more goods to divide between all of us but we all have to put less effort into producing them! The pie gets bigger, no matter how it’s sliced. The fact that many economists are initially afraid of a bigger pie seems of course paradoxical, but it is not that illogical, given how modern society is organized. The only known way to efficiently allocate the available goods to the majority of people seems to be through an efficient job market. An economy that is unable to provide masses of capable and willing people with a job is therefore a horror scenario to economists. This still does not fully explain the fuss: If fifty percent of all demanded hours of labour disappears, but the increase in labour productivity more than offsets this, so total GDP increases, then why not half the hours

World

The ECU’nomist, November 2015

that go into a full time job? In this case, everybody willing to work would have to work only twenty hours a week at the same (or preferably a higher) wage as somebody working a 40-hour week nowadays. In fact, this would bring us close to fulfilment of a prediction made by Keynes back in 1930. He expected that, by 2030, productivity would be between four and eight times higher than in the thirties and therefore people would only have to work 15 hours a week to satisfy all their needs, leaving society left with nothing but the problem of too much leisure. T h e 2030 that Keynes’ portrays must sound like a paradise to many: If we let the robots do all the work, there will be little left for us to do and we can all spend our time doing those things that make life worthwhile, instead of wasting our lives in boring offices. Indeed, if massive robotization will have taken place in Western economies before 2030, productivity per person will be even more than eight times higher compared to one hundred years’ earlier. So Keynes’ prediction can be considered pessimistic! However, unfortunately, it is no foregone conclusion that we will work less. The last decades saw a huge

increase in labour productivity, most significantly due to computerization. The effect of this increase in hours worked however, has been ambiguous for different countries, as is shown in figure 1. Hours worked have remained constant in the US and decreased only a little in the UK, whereas in Japan and Germany they decreased more significantly. Especially the result for the US is striking because labour productivity increased with more than 40% during this period, suggesting that the Americans spent most of this income on extra consumption instead of working less. This conclusion is a bit too short-sighted however, because, during this period, inequality in the US increased as well. As a result, real median household income only increased with 10% since 1970. Thus it is the upper class that has mainly reaped the benefits of the increase in productivity, preventing the common man from decreasing his working hours. The part of extra wealth that did find its way into the workers’ pockets, seems to have been spend on extra consumption instead of extra leisure time. Until the 1970s, increases in productivity came along with quite a rapid decline in hours worked in developed economies. From the late 1970s until now however, this relation is much less clear. Are the developed economies stuck in a 40-hour work week? The question why people have become less likely to transform increased productivity in extra leisure time is puzzling, and many an economist has tried to find an explanation for it. Some argue that people choose not to work less, because they actually enjoy their work. These kind of people will have a hard time once they get replaced by a robot of some sort, even if they will somehow manage to maintain their income. Another interesting explanation is that technological progress not only increases labour productivity, but also increases our possibilities of consumption. Progress does not only help us satisfy our desires, it also creates new ones! Products that are now only available to the happy few, or are not available at all, like driverless cars and robot house workers, might very well be in reach for people with a

“Robots can produce and provide services 24/7 and do not complain about colleagues they dislike and therefore would rather not work together with. When designed correctly, they are way faster and precise than us daft humans”

more modest income in the future, and people will want to work a few extra hours a week to be able to afford them! This is a cycle that can only end once society has progressed so far that no new cool stuff can be invented at affordable prices and thus everyone’s needs are truly satisfied. If the massive robotization that is ahead of us will indeed lead to the end of many jobs while new ones are not created, chances are that either massive unemployment will be a result, or people will ‘share’ their jobs because there will be a reduction of working hours. In a well-functioning labour market, this should not reduce the monthly income of every worker, but in reality, this is a possibility because inequality might be a result of robotization, leaving workers worse off. The last decades however have shown that labour productivity increase and shorter working weeks do not go hand in hand, which might lead to many people still working 40 hours a week in the future, while many others remain unemployed. The fear of unemployment might lead to increased competition between the employed, with even more average hours worked as a result. Less hours worked per person is however what should be desired. This leads to less unemployment and more leisure time for the employed, making sure everyone will be able to enjoy the fruits of the remarkable technological advancements that are ahead of us.

will a robot be doing your dreamjob in the future? Eager to know if the career you are pursuing is robot-proof? Smart decision makers plan ahead! BBC News has created a fun info-graph that will tell you the chance your dreamjob will get automated. Find it at http://www.bbc.com/news/technology-34066941, or by scanning the

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The ECUâ&#x20AC;&#x2122;nomist, November 2015

Utrecht

The ECU’nomist, November 2015

Utrecht Street Photography Aleksander Tase

“A picture is worth a thousand words”... but which thousand words?

HOSE SPOKEN RECKLESSLY from the slurring mouth of a street musician, or the eloquent, forceful ones from a writer’s manuscript. How can one compare the words describing a quaint autumn day during sundown with the ones required to portray the details in the face of passers-by, or the potency of a poet’s short verse to the sophistication and intricateness of a novel? It’s impossible to equate a picture with any collection of a thousand words. That is why I believe that the whole point of taking pictures is so that you don’t have to explain things with words. 15

The ECUâ&#x20AC;&#x2122;nomist, November 2015

The ECU’nomist, November 2015

hen tasked with the project of taking pictures of our city, I immediately swapped my books and laptop for my camera and lenses, seizing the opportunity and finally having an extra motive to explore Utrecht with another eye. I would leave my house with nothing more than my camera and my bike, yearning for at least 8 hours of shooting time… Who am I kidding, with this weather, I’m lucky my camera lasted even 8 minutes. Walking down the same streets as always, not spending a single euro and accompanied by my bike only, I tried to keep in line with my predetermined ideas and street theme.

University Life

The ECU’nomist, November 2015

Exchange to Exchange Article

Annette takes us on a tour of her exchange to UCLA (University of California Los Angeles) in the Fall semester of ’15. Annette Aprilana

ny for a good reason because LA perpetually has good weather and it always emanates the laid-back and easy-going California vibe. I was sure to reserve my accommodation early so that I get to live on campus and not have to worry about commuting. LA is a big urban sprawl extending its reach to nearby smaller cities that all make up part of the greater LA county. If you don’t own a car, getting to places is highly challenging because everything is so far away, and using public transportation isn’t the most efficient or safest (especially for a girl travelling alone) method of travelling in the city. But I managed by relying on friends who have cars or using Uber or Lyft. UCLA’s campus is beautiful. I always felt like I was in summer school as opposed to actually doing a semester when I walk around campus. The atmosphere is always positive with students walking briskly to and from class, the usual skateboarders whizzing past and the occasional cyclists wheeling by. The standard dress code would always be shorts and a t-shirt even until early November, which I still find unbelievable. But I’m not complaining because I loved that the sun was always out. The nice weather is also a reason why exchange students always go out often to experience what LA has to offer. From going on hikes in the mountains to relaxing in Santa Monica beach, there’s always plenty of things to do. LA is also known to have extremely good food. I particularly enjoyed the variety of Asian cuisine I could get from Koreatown, China town and Little Tokyo, they were all truly delicious. But even on campus there was a lot of variety of food. Going into a dining hall with buffet style food ready to be served saves plenty of time and it also means I don’t have to go grocery shopping or do any dishes whatsoever. What about the university itself and their system you may ask? UCLA is a university that uses the quarter system. It’s slightly different to U.S.E.’s quarter system because what’s worth two semesters for us is three quarters for UCLA, with the fourth quarter as

Annette and roommate in the neighbourbood near campus

WAS BEYOND HAPPY when I found out that my University of California (UC) campus placement was in Los Angeles. All the UC hopefuls were warned that most students never usually get the top three campus choices that they want. But I am honoured that I received my number one choice. There were plenty of things to take care of including visa preparations, housing, course selections and coordinating the practicalities of my move from Utrecht to Los Angeles. Although in the end it did turn out to be a lot of work, it was well worth it. I was excited to begin my adventure by attending one of the best public schools in America as well as experience the city that is the centre of the American entertainment industry. After a full two months of internship plus a couple of extra weeks of holiday, going back to school felt more nerve-wracking than ever. I finally arrived in sunny LA after a very long 21-hour flight from Jakarta. I was very lucky to have several high school friends going to university in LA that helped me out a lot when I first started settling in as well as the entire time I was there. I do say sun-

Overlooking the Golden Gate Bridge in San Francisco

University Life

The ECU’nomist, November 2015

UCLA against UC Berkeley Football Game an optional summer quarter. This means that the teaching period and exam week occurs within 12 weeks. Classes are fast-paced and very content-dense. The material isn’t necessarily harder than in U.S.E., it all depends on the classes you take. But workload is slightly heavier because the standard amount of classes to take is three, which is the amount I took. Each class was worth 4 units, the equivalent to 8 ECTS. Some people take four classes but as an exchange student, even the exchange coordinator in UCLA didn’t recommend us to do this. “Stick to the 12 units minimum requirement for visa purposes, otherwise you won’t get to enjoy LA”, he said. That was great advice. I took one economics course called Introduction to Urban and Regional Economics and two management courses (both on entrepreneurship), taught by the Anderson School of Management, the very prestigious graduate management school. I enjoyed both of my management classes very much because it was a more in-

timate setting with only 40 students in the class in a conferenceroom type setting and the content, discussions and materials that we covered were highly relevant to the latest start-ups with very interesting additional case studies. My economics class was larger at around 100 students and provided less chances for interaction. This setting was rather difficult because the content of the course was quite difficult and though the professor accepted questions during his office hours, there were no extra tutorials designated. I was also lucky not to have classes on Fridays, which gave me an opportunity to do weekend trips to cities nearby like San Francisco, Monterey, Berkeley, Santa Barbara and San Diego. But even within LA I managed to see all the touristy places including going to Disneyland, Six Flags, Griffith Observatory, LACMA, Rodeo Drive, Hollywood and Highlands, and many others. In addition, as an exchange student, I attended at least one football game - American football that is - which is a must-go experience. The game I attended was UCLA against UC Berkeley and you had to really be there to feel the strong college spirit and intense rivalry between the universities. College pride and spirit is innate in most students attending American colleges. UCLA’s archrival university is the University of Southern California (USC) and these two even go as far as vandalising their respective mascot statues. Our “Bruin Bear” was even protected by a box the week of the football game against USC so that no damage could be imposed on the bear. Despite the occasional inter-college drama occurring on campus, the facilities and amenities that UCLA offers are remarkable. For example, two of the main libraries allow you to borrow MacBooks and iPads that you can use either for classes, group meetings or even for your personal use during the day. In addition, UCLA hosts a lot of events and it helps that they have an extensive network from which to invite guest speakers. I once attended a UCLA Venture Capital Fund event that invited Uber co-founder and CEO Travis Kalanick, who also happens to be a former UCLA student, to share his journey as an entrepreneur. All in all, my exchange experience was fulfilling and enrich-

University Life

The ECUâ&#x20AC;&#x2122;nomist, November 2015

Royce Hall, UCLA ing. I attended a well-known university, I travelled both the West and East coasts of America, I was enlightened by the knowledge I gained and I achieved the American college experience that I was always curious about. So if you want to escape the rainy and gloomy Dutch weather to have the complete opposite of never-ending sun and warmth, then LA is the place to be. If you want to attend a reputable university that has a beautiful campus with many great facilities and opportunities, then UCLA is your target school. For me, UCLA was genuinely a priceless journey and tops as one of the best moments of my life. Go Bruins!â&#x20AC;

Disneyland Los Angeles

Echo Mountain, Altadena, CA

World

The ECU’nomist, November 2015

Food for Thought

Pretty (expensive) in Pink Marouschka Blahetek

he disparity in marketing for women’s and men’s products becomes most obvious in the toys aisle. A strict divide still seems to be made between gender; pink is for girls, blue is for boys. A new study shows that this disparity is not limited to marketing, but is prevalent in pricing as well. A 2015 study from NYE Consumers Affairs concludes that, in New York, women pay on average 7% more for similar products than their male counterparts. This difference in gender pricing (also referred to as ‘pink tax’) raises an important question. Should we regard these differences as the natural workings of the market place, or do they produce undesirable effects which should be mitigated? I believe producers should be free to benefit from differences in willingness to pay, just like consumers should be free to choose which products to buy. That being said, given the limitations that societal constructs place on gender, it is important for consumers to be aware, enabling them to make better-informed purchasing decisions and persuade companies to change their strategies. So where does gender pricing come from? Is it a devious attempt by cigarsmoking old boys to keep women down? Probably not. Gender pricing is a rational response by producers to maximize shareholder value by exploiting differences in the willingness to pay. Producing products in for example a pink color, enables producers to sell these products at a premium. Being able to sell these products at a higher price in the market indicates that women must have a higher willingness to pay, and perceive products that are marketed especially to women as having a higher value. According to the research, products marketed to women are priced higher 42 percent of the time than similar products marketed to men, whereas men pay a gender-specific premium in 18% of cases. There may also be other reasons for price differentiation. Production costs of similar products with slightly different visual features may vary, something which the study does not take into account. Secondly, consumer demand may also influence production costs. If market demand for pink products is smaller, they may marginally cost more than the male equivalents due to a lack of economies of scale. In short, businesses may increase prices to profit from higher willingness to

pay, although the cost structure of a product can also play an important role in gender pricing. Businesses make rational decisions about how to price their products, so shouldn’t consumers make equally rational decisions about products which are similar in function but different in price? Unfortunately, gender constructs in contemporary society may impose constraints on the freedom of choice of consumers. A lot of marketing aims to sell a product to you on the basis of self-concept; who am I? In the case of gender pricing, products which are specifically marketed to men or women promise to help you become your ideal self and how you would like for society to perceive you. Whilst this basic premise of marketing cannot be regarded as negative per se, phrasing the question differently will show a bit more of a darker side; who do I not want to be or be seen as? By offering products only in a male or female specific version, negative consequences are attached to choosing a possibly cheaper version of a similar product (“You don’t want to smell like a boy now, do you?”). These marketing tactics force you to reason within a very established framework of gender identity, which can be hard to ignore even for the most rational person. So free choices might not be so free after all. What should happen if we deem gender pricing as undesirable? Our beliefs about the market mechanism should determine our course of action. If we believe

that the market will not solve these price differences, then we should put regulations in place. However, with increasing awareness and attention paid to this phenomenon, it would seem wise that businesses change marketing tactics in accordance with new consumer demands. Some proof of changing tactics can already be found within certain brands and department stores, with Selfridges being a good example. Selfridges has launched a concept store named Agender, which creates “a unique genderless shopping experience”. Although only a few businesses are picking up on this trend, the growing awareness of gender pricing creates opportunities to cater to the demand of a new, genderless, group of consumers. Since the study did not elaborate on the cost structure of the researched products, the story remains mostly one-sided for now. The next step should be to look at the production costs of male versus female products to identify other possible drivers behind gender pricing. However, even without being able to pin-point precise causes, price differences might diminish due to growing consumer awareness and demand for genderless products. Increased awareness returns power to consumers by helping them make better-informed choices and it might persuade companies to venture into a new profitable market segment. So the next time you (mostly the ladies) step into a retail store, ignore the pink and blue, and have a look at what the other side of the aisle has to offer.

Europe and the World Interview

The ECU’nomist, November 2015

Post-productivism, the Welfare State, and Basic Income: Interviewing U.S.E.’s one and only, Loek Groot

Filippo Ricci

HIS IS AN EXCITING YEAR for the Netherlands and in particular our beloved Utrecht. Amongst others, Utrecht will see the launch of a social assistance experiment, among which one group with a basic income. For those who don’t know, Basic Income (henceforth BI) is an unconditional amount of money (income) the government redistributes to all its citizens on a monthly basis. And while we hear so much talk of Basic Income, the ECU’nomist prepared an interview with Loek Groot himself, Associate Professor here at U.S.E. The interview will branch off productivism and its counter-doctrine, post-productivism. In short, Productivism gives a privileged status to paid work. In contrast, post-productivists are not anti-productivist, but they assert our economy can flourish also without full employment, full-time for everyone. Productivism is the backbone of current welfare states, for it implies that in order to redistribute to the worse off, we must still maintain production as high as possible. A postproductivist state would say that that is not necessary. Basic Income in fact is, as Loek puts it, “a rather extreme way to realize a post-productivist welfare state”. Along with enlightening us on these welfare experiments and post-productivism, Loek will give us sound advice for prospecting careers, U.S.E.’s new Minor programme, Economics & Social Sciences and some cool economo-political blogs to check out.

Could you tell us a little bit about yourself and your professional background? I studied Economics at the University of Amsterdam, and then I worked for three years at the University of Maastricht. I was working there at the Research Centre for Education and the Labour Market. What we basically had to do there at the institute was to produce labour market predictions for people in high school, and the kind of study they would want to follow up with. They could see after we made these labour market predictions, whether they would decide to study Psychology, Sociology, or something else; these students could see in what type of occupations you might end up and what the labour market perspectives are. How were these labour market predictions made? What sort of variables were included in determining these models? As you probably have noticed, the Netherlands is a very well organised country. We know the exact number of students for each faculty, e.g. sociology, psychology, prospective doctors and nurses, you name it. But we also know the age structure for each occupation. So you do know if you make a prediction for the next 5 years, all the 60-somethings will probably retire within that time. You also do know how many lawyers or nurses are in this group, and by compiling all these numbers, we are able to say something–a raw indication–about the job

prospects. I do remember, at that time that one of the best professions you could choose, with respect to job prospects, was to become a priest. Because the age structure of the priests and the priests facing retirement is known, within 5 or 10 years time, about 1/3 of all the priests would retire. After three years I was a bit fed up with that work, and I made a radical decision. I decided to go back to school and I studied philosophy full-time for three years in Leuven, Belgium. I managed to finish the study in three years and wrote my PhD afterwards, entitled Basic income and unemployment. In my PhD, I combined political philosophy and economics. After my PhD I worked for two years at the Political Science department of the University of Amsterdam, where I focused on voting and so called Voting Advice Applications. We do have nowadays some Internet applications which ask you a bunch of questions. After you’ve answered all these questions, the voting indicator app says “based on your answers, political party X is nearest to your opinions”. I have written a few pieces about these voting indicators. At the same time I worked with Robert-Jan van der Veen. You know his name from class. I worked with him on the topic of post-productivism and the piece that we wrote was published in the British Journal of Political Science The basic idea is that it is a political choice whether you want to arrange society in a more productivist way rather than a post-productivist way. These are almost two completely different doctrines. Actually, could you tell us what the distinction between Productivist and Post-productivist is? We are very used to rank countries in terms of income inequality. We do know that in England and the USA, the income distribution is much more unequal than in countries like Sweden or the Netherlands. How equal or unequal the income distribution is, is to a large extent a political choice. However you can also rank countries according to the productivist/post-productivist dimension, which in the end is also a political choice. That’s a little bit of a new perspective I think. For example, to grant a paid parental leave is post-productivist, but also to waive the duty to apply for jobs to single parent families on welfare with children under age 4. Sometimes, as a society, there are good reasons not to strive for a maximum insertion into paid work. For a postproductivist, full-time is not necessarily better than part time and part-time not necessarily better than being non-employed. In our study among OECD countries we find the USA, Australia, Finland and Denmark to be the

Europe and the World

The ECU’nomist, November 2015 most productivist, the former two by means of economic pressure, that is strong financial incentives to do paid work, the latter two by means of what we call policy pressure, that is all kind of active labour market policies to bring people on welfare back to the labour market. The Netherlands, Norway and France are most post-productivist. This is very interesting as it is somewhat relevant to another article in the ECU’nomist’s current issue: “Help! The robots are coming”, is about robotisation and the resulting unemployment. As I understand, one of the major arguments for basic income is that there might not be a possibility for developed economies to even employ their full labour force. How strongly do you believe in this claim? Good question. My PhD is entitled Basic Income and Unemployment and basically what I say is that if the unemployment problem is there and cannot be solved, then and only then, BI (Basic Income) is an idea worth to be taken seriously. I did however, in retrospect, make it a bit too easy. I departed from the assumption that there is no full employment, if this is so, then the political philosophical justification for BI becomes much more easy, also from an economic point of view. However, at the time of my PhD, robotisation was not yet a big issue, so if I would have to start all over I would definitely take that topic on board. I do not know much about it, I have read some book reviews about it. It sounds like a huge transition problem. By looking at history however, around the mid-18th century, 95% of the labour force was working as a farmer or day labourer. And then we had the industrial revolution and a transition to manufacturing. Last century there was a transition to services. Every time this happened, many claimed that jobs would disappear and the result would be unemployment. So I do expect that even with this robotisation, many new jobs that have never being thought of will start to become viable. We heard a lot about BI recently especially in Utrecht and in Finland. What can you tell us about these experiments? I will meet the project leader for Finland this weekend as he’s visiting the Netherlands. In Finland, the government has decided to endow a research institute called Tänk with 10 million euros in order to set up a real BI experiment. They do not know yet exactly how they will do it, however the government has decided already and endowed this institute with the money. The idea is about implementing a BI of about 800 euros per month per person; before they do this, they want to know how it might

work out. In the Netherlands they designed welfare experiments in Utrecht, Wageningen, Tilburg, and Groningen. The media portrays the Utrecht experiment as a BI experiment, but it is not. Why not? Because with a full-fledged BI experiment, there should also be people in the experiment who are already working part-time/fulltime, and you want to know how they will react to being endowed with a BI. Moreover, if they earn money, the tax rate they face will be higher than the one they face now. In all the experiments within these four cities this is not the case. So strictly it is not a BI experiment. For Utrecht City, it is basically an experiment about what works and what doesn’t with respect to the provi-

indeed argue that if you were to have such a BI, people would indeed be more autonomous and more free to do what they want to do in life. My take on the issue is that in times of unemployment, it is very difficult to achieve compensatory justice, the idea that people doing unattractive jobs should be duly rewarded. By providing a decent fall-back option in the form of a basic income, low skilled workers have the power to say no to shitty jobs. From this point of view, the working poor in the USA are simply the flip side of a very stingy welfare state. To tolerate parasitism , the option that people cash in their basic income and do nothing in return, is maybe a price worth paying to achieve compensatory justice in

sions of a social assistance benefit. Is it a good idea to simplify the conditions for receiving welfare benefits? What difference does it make whether or not to maintain the requirement that people receiving these benefits have to apply for jobs?

the labour market

So as I understand it will work primarily as a benchmark and if I’m correct it targets the low income/unemployed members of the labour force. In Utrecht we are targeting the group of people who have been at least 6 months on welfare. How does this contrast with true BI however, under which we hope people become more autonomous and therefore, seek to fulfil their true ambitions? I’m currently reading a yet-to-be-published book by Philippe van Parijs and Yannick Vanderborght with the title, “The instrument of freedom: why we should all receive an unconditional basic income”. They do

Which all ties in with post-productivism. Yes, indeed. BI would be one, rather extreme, way to realize a post-productivist welfare state. By the way, I am not saying that a post-productivist welfare state is better than a more productivist one, but that it is a political choice, with all kinds of tradeoffs. What do you think is most interesting in the design of the Utrecht experiment? What we are also trying to test here in Utrecht’s welfare experiment is something which we obtain from behavioural economics. In this experiment, among the six groups, there will be two groups, one group receiving €150 extra only if they do some sort of social service. Whereas the other group will already see these €150 on their bank account at the start of the month, on top of their welfare benefit, but it is withdrawn if the social service condition isn’t

Europe and the World fulfilled in due time. So the first group sees the €150 as a reward and the second group as a punishment, as a withdrawal or loss. As we know from the behavioural economics literature, people are much more concerned with loss aversion than realising a gain. We do expect to see the people who already see these €150 on their bank account to do much more to prevent this money from being withdrawn compared to the other group. From a rational economic perspective, both are the exact same endowment. Interesting books on these issues, besides of course Kahneman’s Thinking Fast and Slow, is “Misbehaving: the Making of Behavioural Economics” by Richard Thaler and also Enlightenment 2.0 by Joseph Heath, which I think is the best book I’ve read in the past two years. These books have convinced me that it is quite strange to assume as economist all the time that people behave in a rational way. To a large extent our behaviour is rational only to the extent of and because the rationality is embedded

The ECU’nomist, November 2015 in all kinds of institutions in a broad sense that shape our behaviour. To assume rationality right away is simply too huge an assumption. When you read these books, you realize that more and more, humans are product of evolution, and we are often using System 1 and acting impulsively...

“Because it is a choice whether you want to arrange society in a more productivist way rather than a postproductivist way. It’s a political choice. ”

The emotional tail is wagging the rational dog. Yeah! However, rational thought is possible, but it takes time, we must concentrate, it’s slower. We can do so, but it is not natural to assume that people behave that way all the time. We can do so, but it is special, we must concentrate, put away our cell phones, focus, et cetera. When I had read these books I was convinced we should take this Behavioural Economics seriously. Since then I’ve

been reading more and more of these books. Do you have any advice for our fellow U.S.E. Students? Well, it’s a little bit biased *chuckles* because I am the coordinator of the Master in Economic Policy, which I would recommend highly, since we have now included Behavioural Economics and Public Policy as a course. I would say for the bachelor students, the main motivation to choose this master is getting a job, but not just any job. A job in which you have a bit the feeling of a moral high ground, that you can contribute to a better world. The other advice, and this is also biased since I’m also the coordinator of one of the approved optional minors–and we have reformed last year all the minors. There is now a new minor: Economics and Social Sciences, and the good thing is that if you do this minor, you are really being lectured by people from the Psychology department, from the Sociology department et cetera. We offer courses such as Psychology and economic behaviour, Behavioural economics and Doing multidisciplinary research in the social sciences. The last course are weekly seminars offered by myself and other lecturers involved in multidisciplinary research. These are all researchers who have shown that they are able to combine and integrate different disciplines. In addition, I would advise U.S.E. students to regularly visit weblogs like Paul Krugman’s Conscience of a Liberal, or John Cochrane’s Grumpy Economist, to learn more about policy debates among economists. As a year theme, we thought of asking this following question: do you have a favourite song, genre, or artist you’d like to share? In my formative years, so when I was 16 or 17 years old, it was a bit of the Punk era *chuckles*. It never caught me, nor did any other pop music genre. Nowadays I’m listening to what people call minimal music. The most famous composer is probably Philip Glass, but the one I like most is a composer from Belgium, Wim Mertens. So what I like the most are Modern Classical composers in the genre of Minimalist music, so Philip Glass, John Adams, Wim Mertens and Michael Nyman. And my number one Political Philosopher at the moment is... May I take a guess? Please! Joseph Heath? Yes it’s Heath *laughs*. Did you know he wrote a book The Efficient Society? What more can an economist wish for?

Europe and the World

The ECU’nomist, November 2015

Guest Article

A long history of 57 years: Turkey vs European Union Cem Perdar

HE REPUBLIC OF TURKEY has been pursuing since its establishment, a peaceful, realistic and consistent foreign policy guided by the principle “peace at home and peace abroad” set out by the Turkish leader Mustafa Kemal Atatürk. Turkey conducts a foreign policy generating security and stability in its region and beyond based on its democratic and secular political system, vibrant economy and its tradition of reconciling modernity with its cultural identity. After the collapse of Ottoman Empire’s 500 years rule in Europe, Middle East and Africa, young Turkey was founded in 1923 by Mustafa Kemal Atatürk. Since then, many improvements have been made by Turkish governments. Some these improvements such as the abolition of the sultanate, the transition to secular political system, creating a multiparty system, safeguarding women’s rights, improving literacy etc. However, in order to catch the harmonisation with Western countries, more changes needed to be made. In order to actualise its continental border safety, Turkey has became the member of NATO in 1952. With this important membership, Turkey was giving the message of securing their territorial integrity to the world. It was time for Turkey to fulfill this security and improvements in European Economic Community as well. Thus, Turkey chose to begin close cooperation with the fledgling EEC in 1959. It was July 1959, Turkey completed its membership application just after the establishment of the European Economic Community (Now it is called EU). The

EEC’s response to Turkey’s application in 1959 was to suggest the establishment of an association until Turkey’s circumstances permitted its accession. The ensuing negotiations resulted in the signature of the agreement creating an association between The Republic of Turkey and the European Economic Community (the “Ankara Agreement”) on the 12th September, 1963. This agreement, which entered into force on the 1st of December 1964, aimed at securing Turkey’s full membership in the EEC. After that time Turkey had started to improve itself in regards to technological, educational, and human rights angles. However the relations between two sides were suspended due to the military coup of 1980. On the 14th of April, 1987, Turkey submitted its application for complete membership into the European Union. The European Union confirmed Turkey’s eventual membership. But soon after, the poor relations with Greece and the big Cyprus problem became a persistently big handicap during the negotiations. On 1st of January 1997, Turkey accomplished its first two phases of candidacy by being a part of European Custom Union. So the goods which are being produced in Turkey were being shipped through European borders freely. However, in 1997 the candidate status of Turkey was declined due to the fact that Turkey did not accept Greece’s requests, problems with Cyprus, and some historical incidents with Armenia. The situation was reversed in the EU Helsinki

council in December 1999. Finally, it was declared by EU that official membership negotiations would’ve started with Turkey on the 3rd October, 2005. As Turkey did not acknowledge the official existence of Cyprus as a sovereign country, the negotiations were suspended within 8 chapters by EU on 11th of December 2006. And in 2010, 13 chapters were activated by EU to proceed the negotiations between the two sides. In 2011 the Turkish Government established the EU Ministry. Their aim is to show Turkey’s eagerness in being a part of the EU. Since that time, many summits and negotiations have and are being done mutually. According to President Erdogan, Turkey will complete the period of candidacy by accomplishing the necessary reforms, improvements and finally become an official member in 2023, on the anniversary of 100th year for Turkish Republic. Why has Turkey encountered so many difficulties during its candidacy period? Let’s find out the answers from the past. Since the foundation of Ottoman Empire, Turks have dominated the European geography time to time. Especially until the beginning of 1800s, the Turks had an important place in European policy and geography due to its military power and geopolitical situation. However, by missing the industrial revolution, technological developments and 200 years of delay of the printing press, the Empire had dug its own grave. But real collapse had started after the 1850s. Many wars with Russia, the Balkans and Western countries did not give any chance to the Ottoman Empire to improve itself in regards to its education, industrial, and scientific areas. After all those war years, leader Mustafa Kemal Atatürk improved the young Turkish Republic in order to catch the Western civilisation after 1923.

World In my opinion, one of the most important contrast between Turkey and the EU is a religion issue. At the moment in the EU, there are 28 official members and all of them are Christian, however Turkey is a muslim country. Although it is a secular country (not being ruled by Islamic rules), there are some small to big differences between their cultures. What are those cultural differences? Differences such as those in lifestyles, family habits etc. Apart from the religion issue, economic uncertainty, the fragile structure of its institutions create another important problem on Turkey’s way for the EU. In particular, the community would not accept another country who has uncertainties in economy like its members Greece, Spain and Portugal. Despite the fact that economy of Turkey is growing with better figures than EU average, we can not predict the figures of following years. Turkey has around 80 million inhabitants and a very young population. So this may create a perception that Turkish people will hold major chairs in the EU parliament due to its population size. Who knows? Additionally, Ottoman Empire had ruled some important parts of Austro-Hungarian Empire and all Balkan area including Greece and Cyprus; this certainly doesn’t bring back any good memories from the past. After the global economical crisis in 2008, some EU member countries have bankrupted. Ireland, Greece, Portugal, Spain and Cyprus.opportunities. Due to globalisation, the world is getting smaller and smaller. Precious information is moving from West to East. At the moment, China, India, Indonesia, Taiwan, Argentina, Brazil, and Turkey are becoming important in industrial markets due its competitive costs and qualified labour forces. During my visits I have had several chances to evaluate the labour force quality in the Czech Republic, Slovakia and Poland. These countries have improved substantially in automotive assembly the since 90s. At this point, we may see that money is migrating from West to East. Nowadays sanctions in Iran are being removed. Probably in a couple of years, Iran will be the shining star of Middle East and all Eastern countries. All things considered, we have seen the contrast since the beginning of the 2000s. This contrast is Europe’s big recession in opposite to East’s growth including Turkey. In the first quarter of 2015, Turkey’s growth rate was 2,3%. However this ratio for EU zone was 1,5% and 2,7% in USA. From that we may see although Turkey is not a member of EU, it can maintain its economic growth by itself and stay above the better figures of the EU. According to the IMF’s

The ECU’nomist, November 2015 economic growth forecasts in 2016, the EU will reach 1,8% and Turkey will be at 3,4%. So should Turkey be allowed accession to the EU or not?In my opinion, yes. The EU will be stronger with Turkey’s participation, which has improved both economically and industrially. The point which we shouldn’t forget is “Union constitutes strength.”

Born in Istambul, Cem Perdar has been working as a Key Account Manager since 2010. He came to Utrecht University as a visiting student for Entrepeneurship and Finance classes. He completed two masters, one in Finance and one in Business Administration in Rome and Marmara respectively. See guest contact list for more information and photos: cperdar@gmail.com

Lecture

Is the Euro back on track?

Attending Jeroen Dijsselbloem’s lecture Sjoerd van Alten

URING HIS SPEECH, minister Dijsselbloem mainly attempted to convince the audience that the European monetary union has a bright future. He started off by indicating how countries from outside the EU enviously scrutinize the unique form of collaboration that the European Union is. The minister was delighted that all Euro countries, except for the Eurozone’s problem child, Greece, have returned back to the path of economic growth. He saw the construction of the banking union in 2012 as a great effort in reducing the risk of worthless financial assets in the banking sector. At the same time Dijsselbloem stated to be aware that potential growth in the Eurozone was still far too low, and that many risks remain. The minister concluded by saying that: “Looking back, construction errors were made, and we’re [making] that right.” During a thirty minutes Q&A session, the minister took the time to give in-depth answers to students’ questions. Students were interested to hear Dijsselbloem’s opinion on a big range of topics, such as the crisis that is possibly emerging in China, his view on how he handled the Greek crisis,

Dutch government selling ABN-Amro bank and what his typical day looks like. The seminar concluded with a panel discussion. Claire Economidou, associate professor of macroeconomics at the University of Piraeus in Greece, introduced the discussion with a presentation on the EU’s future, in which she proposed that the only possible futures for the EU were either ‘muddling through’ or an even closer union. In this respect, she mainly claimed that a fiscal body would be of great help to stabilize the Eurozone. In his speech, the minister had claimed that there is no firm evidence this is necessary. Sandra Phlippen, editor-in-chief at ESB, started off her contribution to the panel by stating that risks have to be privatized in the Eurozone. She is worried that the current economic growth will lead to the false belief by politicians that reforms are not necessary anymore. She also stated her worry about the democratic legitimacy of major reforms taken at a European level. In her belief, the public has to be convinced about the bright future Europe could have first. Arnoud Boot, corporate finance professor at the University of

University Life

The ECU’nomist, November 2015

Amsterdam, also stated that he was worried about the lack of democratic legitimacy that holds the European Union back from taking necessary major steps. In his view, the only reason to resolve this is by convincing the new generation of the benefits of the Eurozone, because the older one is a lost cause in this respect. Boot also indicated that the financial sector was the EU’s main problem. Society and financial sector have to become more independent from each other. Victor Cramer, the head of the EUdivision of Dijsselbloem’s ministry, agreed that convincing the public of the Eurozone’s benefits is vital. He emphasized the importance of competitive member states in order to afford the advanced social model that characterizes EU-countries. A capital markets union should be an important step to diversify risk in the financial sector. Martin Visser concluded the panel discussion by stating that more European collaboration seems to be the road the Eurozone is taking towards stabilization.

Events and Committees

OPENMIC COMMITTEE

On the 29th of February ECU, together with Study Association Alias, is organising an Open Mic evening at café Hofman. During this evening you can use the stage to show your creativity to your fellow students, on your own or as part of a group. Are you an exceptionally good guitar player, incredibly funny, or a great dancer, storyteller or both? Apply for the open mic evening! Of course, it is possible to just watch and drink a beer. Practical matters: - Send a discription of your act + things you’ll need/bring to openmic2016@gmail.com - Acts may take 20 minutes max. - The Open Mic will be in English, but Dutch acts are allowed - Pre-sale tickets € 3,We will keep you updated through our Facebook event: Open Mic

University Life

The ECU’nomist, November 2015

CLUB ECU’92 Dear ECU’92 party animals, We, Annemarie, Ben, Roza, Mariëlle and Tim, members of the most awesome committee called Club ECU’92, hope you enjoyed the parties we organized so far this year. We are working hard to make the upcoming Club ECU’92-nights at least as awesome! The DIES-party will be the best one Utrecht has ever seen: We will combine all the great ideas we have come up with up until now to make it an unforgettable night. Do you have a great idea yourself? Do not hesitate to contact us! Furthermore we would like to let you know we did enjoy the parties very much: Thank you all for coming and for making them worth the visit. Please make sure you do not miss out on the next ones. With you guys every single one of them will definitely be awesome! We hope to see you all very soon! Lots of love, Club ECU’92 2015-2016

HONOURS COMMITTEE At the beginning of the academic year in 2014, students of the USE Honours Program expressed their desire to have some sort of prestigious overall body, representing both the Utrecht School of Economics and the honours students. Their wishes were granted by study organisation Ecu’92, who founded the Honours Committee last year. Consisting of honours students from every bachelor year, the committee began their journey. This year, seven enthusiastic individuals continue the journey with more events, more speakers and more fun! Ranging from social activities to career events and symposia, it will be a busy year. The grand finale will be in June, when we have the honour (pun intended) to organise the USE closing academy. We’re looking forward to make 2016 the best honours year yet! All the best, Arlinde, Eni, Gabriela, Jihun, Joris, Lucas and Ruben

University Life

The ECU’nomist, November 2015

DISCUSSION AND LECTURE COMMITTEE After a slow start, it is time to make this year a blast! This year the Discussion and Lecture Committee is set on surprising you all with some fantastic lectures upcoming alongside a few other exciting events. The committee itself is a nice mix of international students with a very different point of view on certain topics. However, most conflicting opinions do not concern the topics of upcoming lectures. Somehow we can never set to agree on a date for a fun activity! We managed to have our first dinner at the beginning of January and hopefully we will be able to do some more teambuilding in the following months. Of course, besides one cancelled event, there have also been successes. The first lecture with Harold Goddijn attracted so many visitors that we had to upgrade the venue at the very last moment! Hopefully we will be able to get you just as enthusiastic about our upcoming events, as we can’t wait to announce what else we have in store for you… Kind regards, Gligor, Marc, Antoinette, Martijn, Dennis, Natascha and Anastasia

S.E.C.U Hi all! We are Sietske Kamsma (Chairman), Nina Lemmens (Secretary), Jasmijn Bolt (Treasurer), Bobby Cornelisse (Coordinator Promotion), Mando Kort (Study Manager), and Inge Scholman (Coordinator from the Board). Together we are S.E.C.U. and as you can see we are a committee that really likes to have fun together. We even went on a weekend together, where we got to know each other on a whole new level! Along with the fun we take care of the book sale every period, to make sure everyone gets his or her books on time. Since we like “fun” we thought of a way to share this positive vibe with all of you, therefore we give away nice gadgets at every book sale. Next to this we started a summary service so more people can make use of summaries when studying for exams and in this way we try to make your lives a bit easier. We are now brainstorming about the idea of enlarging this service and thinking about new opportunities for S.E.C.U.. In this way we try to improve our services and especially the book sale. We are looking forward to see you there and we hope you are as well! 31

University Life

The ECU’nomist, November 2015

STUDY TRIP COMMITTEE Hi there, Study Trip Committee here! We are Erik (Co. from the Board), Erika (Co. Acquisition/ Co. Promotion), Kas (Secretary), Tom (Co. Accommodation), Nina (Co. Scenariobook), Eva (Treasurer) & Simone (Chairman) (left to right, top to bottom) and we are planning this year’s Studytrip to the Baltics! As a committee, we have already been planning this trip since September and you can imagine that we are extremely looking forward to it, we even had a dinner with some local dishes! However, we can’t do it without you! Some practical information: The trip will take place in the retake week in April and cost about €360,-. What do you get for this money? An amazing 8-day trip with 32 students in which we will visit various cities and their highlights, an embassy, some companies, a university and we’ll of course also explore the Baltic nightlife. So sign up February 16th, be on time (8.30am) and secure your spot for the Studytrip of 2016! P.s. If you have any questions regarding the trip, please don’t hestitate to contact studytrip@ecu92.nl or ask one of the committee members!

CONFERENCE COMMITTEE We have been working on it for more than one year and we are almost done with the preparation of the upcoming conference of ECU’92. It was a lot of work to arrange everything but with the help of the network of our university we think that we created an interesting program for you. We are very honoured with all the speakers, of which most especially visit the Netherlands to speak at our conference. The topic of the conference is: ‘Breaking Barriers: Envision the Future’. Four speakers from different angles will share their ideas about the future of our economy. One of the speakers will share his ideas about ‘Basic Income’, for more information see page 24 of this ECU’nomist. We are looking forward to welcome all of you at our event at the Academic building on the upcoming 17th of February! (reservation is required, see ECU92.nl) Chair of the Conference Committee, Gerben Hiemstra

The ECUâ&#x20AC;&#x2122;nomist, November 2015

Jouw studievereniging wil het je zo voordelig en makkelijk mogelijk maken. Dus hebben ze een boekenleverancier die daarbij past.

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