Saturday, October 24, 2009

Afghanistan and the two period economic model

Two-period models are often used in economics to study what deicisions people will make if there are only two periods in the life of a person. We study a lot of stuff this way-- inflation, taxation, investment. Sometimes we wonder whether these are an oversimplication. Perhaps there are more than two periods when we are making decisions about, for example, whether to spend more money after a tax rebate (for which we will be taxed in the next period). Reading See You Soon, If We're Still Alive I kept on thinking that the problem with Afghanistan is that a two-period model would be an over complication of reality.

Repeatedly, van Linschoten and Kuehn, write about this lack of predictibility of life, some excerpts of which I provide here:

The social effects of this constant bombardment -- literal and figurative -- are deeply corrosive. A common saying on parting company these days is, "I'll see you soon, if we're still alive." The assumption that you might be killed at any moment is one of the most pervasive and disruptive of mentalities. It means that you cannot think forward more than a day or two. The biggest gain in the shortest amount of time is the usual attitude to most things. With this mindset, it is almost impossible to work, let alone try to build any sort of political consensus.
But no matter how bad or good things become in the city, in the end the war is being lost -- and will be lost -- in the villages, especially those of the four overwhelmingly rural provinces that make up Loy, or greater Kandahar. Attempts to "protect the people" along belts of security in the cities are perhaps honorable by intention, but they will not end the conflict. Real security -- whether behind blast walls in Kabul, inside armored vehicles, or beneath Kevlar flak jackets -- remains an illusion. In Kandahar, the simple rule is that everything is ok until it is not.
It is impossible for us to expect the Afghan populace to engage in activities other than violence when the unpredictability of life means that there is no reason to save, or invest, to educate or be educated.The problem is that there is no two-period model. It is flat-- tonight you will be alive, maybe, and if you are, you might be--with a reasonably high chance-- dead tomorrow morning, or afternoon, or at the wedding party tomorrow night. Now I may not be smart enough to recommend to anyone how this war on and in Afghanistan will end, but this is for sure-- until people know that they have a good chance of living in that second period, or being able to reap investments, their utility maximization Lagrangian will spout only results like fight, kill, saveyourself.

No comments:

Post a Comment