I find this part interesting as countries are impacted to different extents as a result of an economic crisis depending on their institutional effectiveness.

Thailand, Russia, and Brazil were all developing economies in the late 20th Century. Hence, they are less measures and resources to be able to cope with extraordinary circumstances, compared to a developed country like the US.

This highlights the development gaps between MEDCs and LEDCs. When a crisis of any form comes in, the gap becomes further exacerbated as LEDCs are much more severely impacted. This connects to the contemporary example of the economic crisis caused by the COVID-19 pandemic, which impacted low-income countries due to reasons such as vaccine distribution, healthcare quality, and foreign direct investment inflows.

This really connects to behavioral economics, showing how different ways of calling LEDCs can impact people's perceptions towards these countries and ultimately their willingness to invest money into them.

The name "third-world countries" creates a negative connotation of extremely poor countries in the eyes of people, especially the less-educated ones, from wealthy countries such as the United States, making them less inclined to invest in these "poor" countries that would put their money at risk.

However, the term "emerging markets" creates a positive connotation of growing economies with high future potential, with examples such as China and India most likely coming to mind. Once again in the eyes of the uninitiated from the US, they think of such countries not as poor, chaotic, and unreliable but rather as developing rapidly and behind only the well developed MEDCs like the US.

Hence, it is quite astounding to imagine a simple name change can have such an impact on people's attitude towards making investments, which has significant implications.

I found this comparison really interesting because we traditionally compare people within similar contexts to ensure fairness in our comparison. For example, US colleges do not compare students at SAS to those attending school in rural India simply because the large differences between the two places in resources and opportunities make such comparison unjustified.

However, in the context of economics, such comparison is specifically made to highlight the inequality and imbalance of development and wealth between places. Although different places are invariably unequal due to many factors, these factors are identified to produce solutions, hence justifying such seemingly unfair comparisons.

Not only do Yichen and Renfu differ from Mark and Stephanie in national origin, they also come from different backgrounds within their respective countries. These factors cause them to both start and end at different places in life. Here, the author is making explicit comparisons between their life outcomes, which many deem unfair, but it is precisely this difference that economists are interested in.

This lens is definitely of new exposure to me, but nonetheless, I completely agree with it. No one has control over the circumstances in which they are born into - it is all a matter of "incarnation." Although such term is improper in the sciences, its idea is perfectly encapsulated by this concept of accidents of birth.

These "accidents" determine our starting points in life, and as I know from watching F1, where one starts often to a large extent deduces where he finishes. I find this to be a great analogy that explains the phenomenon of inequalities in life as a result of inequalities predetermined at birth. Underprivileged people can work hard, they can seldom "overtake" the privileged people because they too are working hard. This further perpetuates the poverty trap through another lens.

This is perfectly consistent with an article I read about on the positive correlation between SAT and income. This makes sense because wealthier parents have more money to buy them resources such as tuitions and practice materials, which, given the same amount of time and dedication, would necessarily lead to increased SAT scores. Therefore, such scores are sometimes poor indicator of a low-income student's true capability and potential, potentially costing his chance at selective universities (of course, prior to the test-optional policies brought forth by COVID) and further exacerbating education inequality.

This is consistent to an article I read about regarding the detriments of climate change on productivity of many sectors that depend on land (especially natural ones) over other factors of production. Such sectors include agriculture and fishing. Knowing the importance of such sectors in the lives and livelihoods of developing countries as well as every scenario being different, this cost-benefit analysis focusing on abatement level is very beneficial to ensure that environment and, consequently, the resources do not degrade.

This got me thinking how public benefits are always compatible with public opinions. Sometimes, people are irrational about prioritizing economic growth over environmental protection, especially in developing regions where people are less educated and desire rapid development. In this regard, I question whether the “ideal policy makers” would truly be ideal to the people, especially if he knows the right actions to take that may be unpopular amongst the people. This relates to the social contract theory: to what extent do people give up certain rights in exchange of their governors protecting their other more important rights.

The concept of specialization has long been taught as an almost flawless idea courses I have taken in history and economics; however, I learned about the weakness of specialization being the lack of substitution ability causing all stakeholders who depend on an entity who exclusively specializes in a particular area.

With regards to China, I understand the argument that China can take advantage of the pandemic to increase its international power; however, I do not agree with this. Because China has the willingness and ability as a large economy and initial survivor of the COVID-19 pandemic, it feels as though it is duty-bound to aid less-developed countries. Therefore, I agree with this article that China is helping other nations for the sake of helping them alleviate their crisis. The government invested billions of dollars to assist those countries and calling for other more-developed countries to aid the less-developed countries. Here, China sets an example as a role model for taking initiatives.

This really juxtaposes normal and unusual circumstances like the COVID-19 pandemic. In different circumstances, firms enact different strategies to manage productivity. This is really interesting because in theoretical economics, we know that firms try to maximize productivity in order to maximize profit, and a huge way in which they foster productivity is through resource management. Given the law of diminishing marginal returns, each additional unit of capital, especially human capitals, has progressively less impact towards the firm’s productivity. At one point, it starts to make negative impacts. Hence, there is an ideal threshold level beyond which resources become underutilized or conflict against one another, both of which hinder the firm’s productivity. Hence, it makes sense for firms to eliminate redundant resources under such models.

However, what these theories do not take into account is that the world economy is constantly changing, and the developers of those models could not have taken unforeseen events like the COVID-19 pandemic into account that dramatically shake up the economy in unprecedented ways. Hence, firms who follow these models and eliminate present redundancy, despite their successes under normal circumstances, risk vulnerability in their production capability in a time of unexpected crisis that is otherwise unseen without the pandemic. They have no back-up resources in reserve, nor alternative business models under which to adjust to, for example, a drastic surge in demand, like what happened to the healthcare sector.

And under globalization, the dependence of firms, sectors, and countries on one another further exacerbates this vulnerability. If one entity fails under the pandemic due to the aforementioned reasons of rigid operation structure that only works in normal circumstances, other stakeholders who depend on this entity would have their benefits at stake.

That said, one entity who responded effectively against the pandemic is China, due to its well-established economic autarky and factor endowment. As a result, it not only sustained itself through this crisis but also was of valuable assistance in various resources to other countries in need. While this increases China’s international power to an extent, it is ultimately beneficial to many countries who are less capable of dealing with the pandemic, as China is willing and able to offer its helping hand to alleviate their crisis, such that the international community can minimize the economic disruptions brought forth by COVID-19.