Tag: economics

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Former Crypto currency

The rationale behind a Crypto currency is quite an ancient idea. In the absence of a central bank or in addition to it, people may choose to establish their own currency or currencies. The central idea is to secure assets (currently and in the future) as well as to enable an exchange between a community of people. The Museum of the National Bank of Belgium (image below) has a “Yap stone” on display which originates from the Pacific Yap Islands. Even very heavy and big stones served as wealth storage. The idealistic value of a particular stone conveyed additional value. In the true value of the word these people were banking on stone money in a way not to distant from what Crypto currency embodies today.

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AI in Central Banks

Yes of course, Central Banks will use AI, and some do so already (Kazinnik and Brynjolfsson, 2025). Beyond the standard application of AI by its employees, there are many potentials to use AI to analyse and publish data at a faster rate or in order to detect financial crimes. Similarly, data collection based on webpage harvesting might yield new indicators of inflation, expenditure for environmental risks (heat waves, flooding etc.) earlier and in addition to the normal set of indicators. Hence, Central banks might be better and faster in forecasting inflationary tendencies using more AI tools in their daily routines. Of course, it is difficult to predict a disruptive tariffs policy of a major economic player in the world economy, but the calculation of more, even hallucinatory scenarios become more feasible. It is feasible to weigh overall risks of different scenarios to the economy.
(Image: Celtic coins, Museum of the Belgian National Bank)

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Vacation money

The budget for a vacation, depending on your destination, is subject to exchange rate adjustments. If there are several months between planning and traveling the exchange rate like between the US $ and the Euro € has fluctuated recently by 10% in favor of the €uro. Nice for those receiving salaries in € and who spend their vacation in a region using the US $ as main payment currency. International tourists frequently calculate in $ and therefore might find Europe a bit more expensive than before the return of Donald Trump in the USA.
However, for all those who live in the Member States of the Euro-area and take their vacation there as well, they no longer think in exchange rate risks to their vacation budget. Additionally, there are almost no risks to be subject to fake money transactions like in unfamiliar currencies.
In the Euro area we can use for example backlight to make sure a 50€ bank note is a real one. Happy vacation! 

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Geo-politics of Electricity

Think of a society only based on electric energy. In the 21st century this energy stems from photovoltaic cells, wind and water turbines as well as geothermal energy sources. Each region of the globe and even within a country has its own kind of access to electric power specifically originating in the geographic and geologic context. This means we are returning to a phase in which “natural monopolies” of power generation have their comeback. Rather than nation wide power monopolies, the regional specificity becomes important again. Of course, this raises a lot of geopolitical issues and maybe tensions. Local economies will develop their own electricity provision. Larger and smaller companies can reorganize their power provision themselves. Energy monopolies become outdated if the infrastructure and legal frameworks are adapted to the potential of the “All electric society” conditional on new forms of “power” sharing. Electric and political power sharing will be key in the geo-politics of electricity.

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Green trade flows

The statistics on trade flows reported by the UN Department of Economic and Social Affairs have a comprehensive data base in the background. The descriptive inspection of the raw data on trade flows comprising solar panels, batteries and electric vehicles shows a stark imbalance of how future-proof the trade between countries is. The New York Times (David Gelles et al. 2025-6-30) has put this information into an impressive graphical design to show the magnitude of the imbalance of how China trades in green products with the world and how the USA is losing out on future-proof low carbon emission trade. Despite the fact that China is still heavily emitting CO2 today due to burning coal for electrical power, the investments at home and trade with the world is moving into the opposite direction. We have seen many of these industries at risk in Europe, like solar panel production, batteries and increasingly electric vehicles, without the western countries getting organized to address crucial business and economic challenges. Falling behind in these industries and trade will shift global balances in the near future. Renovation through innovation is more promising than holding on for another decade to inefficient and more polluting energy sources. Repairs of homes and buildings have long lasting effects, which we can, nevertheless, change today.

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Learning by using

Is learning by using different from learning by doing? In an economic model to test the employment/unemployment impact of AI in the USA, Wang & Wong (2025) suggest an important impact of employees’ productivity due to learning by using AI. In terms of the traditional language of economics the employees who use AI in their work shall have comparative advantage to those who don’t.
In a model of job search in the economy there is the additional possibility, similarly to robots previously, that certain tasks maybe influenced by the, more or less, plausible threat of an employer to replace the employee by training an AI system to perform the tasks. The credibility and acceptability of such threats are likely to impact wage claims and unemployment risks. All these effects do not happen instantaneously, but evolve over time with varying speed. Hence, calculations of effects have high error margins. The resulting model yields oscillations of “labor productivity, wages and unemployment with multiple steady states in the long run”.
Learning by using seems to be a good description of what occurs at the micro level (the employee) and at the macro level of an economic sector or the economy as a whole. Society may guide the use cases of AI just as much as the business case to use AI, for example in the creative industries as infringements of copyrights may occur on a massive scale. However, learning by using is not free of risks to society at large. Just like allowing people to use automotive vehicles has lead and still leads to thousands of deaths annually, learning by using produces external costs. Overall, this is another case for a benefit/cost analysis for businesses, the economy and society.

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Pervasive waste

From time to time waste from so-called highly developed countries is making headlines and then it is forgotten again. Huge amounts of plastic waste gets shipped for example from the USA to Malaysia in containers regularly (NYT 2025-7-1). The dumping of waste in other countries where it is cheaper to waste the waste is a cynical practice. Not only is the potential for reuse and a circular economy disregard, the little control that is exercised how the waste is treated afterwards is neglected. Some might just end up in our oceans later on or find its way in our food chains. The recent discovery of lots of nuclear waste at 5000 m depth in the sea in another extreme example of this practice to dump waste affecting all of is when profits have been accumulated inn the hands of a few enterprises and states. Such external effects as they are called in economic theory are part of the standard economic thinking. The challenge is to detect such behavior, persecute or better prevent it. This calls on countries who produce the waste to check for the contamination potential and treat their own waste. Fukushima has lots of barrels of nuclear waste waiting. The pervasive nature of this waste will make it last for thousands of years. “Beggar thy neighbor” with your waste is a major default of our current economic and social model. It remains an unresolved puzzle why mankind continues to work towards its own extinction. (Image: Le grisou, Constantin Meunier, MRBAB, Brussels). 

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History coined

It is an ambitious project to frame history of a country or continent according to the succession of coins. In the KBR such an attempt is currently on display in 2025. The history of a country in the center of Europe is reflected sometimes through different occupying forces who imposed their currency onto the occupied territories. The Greeks and Romans had an overriding impact on the development of coins in human history and society.  Precious metals were used as basis to embody lasting value into coins. The images on coins are also a way to reiterate the dominance of a new ruler or governance. From the Roman occupation there are nice specoin the KBR collection as Julius Caesar named one part of the 4 occupied territories “Belgica” beyond what we define as borders of Belgium in the 21st century. Control of your own currency means also to be able to produce unique pieces in your own foundries. The history of coins is also a history coined by those in power to enforce their political power onto the economy. (Image: KBR, The history of Belgium illustrated through coins, 2025).

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Home financing

For most people the biggest investment decision during their entire life course is the decision how to finance their home. The calculation of the costs of a bank loan over 10, 15 or 20 years to finance the acquisition of a home is a necessary part of basic financial literacy. The contract of monthly installments over years, considering economic uncertainties like inflation and interest rate payments, necessitates some basic knowledge of calculus and maybe the use of a spreadsheet to prepare payment plans with different scenarios. According to the Wall Street Journal of 2025-6-25 many home owners in southern states “slipped under water” in recent months in the USA. In short, buying a house when they are most expensive with a high interest loan and little down payment puts you at high risk if the prices for homes decline, for example like in a recession or stagnation. You can find yourself in the situation that the mortgage you have to pay suddenly exceeds the value of your home at actual prices. It is really important to be aware of the overall economic situation and risks of changes, like interest rate or inflation spikes due to a changing policy on tariffs. Reading and learning about financial risks should really enter into the school curriculum, but not left to maths classes as this will frighten off many students to take this topic seriously enough. 

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Robot repairs

Robots have been used mostly in industry for assembling, transport or sorting tasks. There is also a role in disassembling to enhance circularity. To repair electric or mechanic devices there is an enhanced version needed which starts with a diagnosis of the problem. Algorithms can sort out promising from dead end routes of repairs. However, the recognition of objects into things that can be repaired and those without repair potential is a worthwhile assistance. Beyond the economic and ecological rationale for repairs, there is an emotional or nostalgic sense to it as well. Maybe, from a life course perspective any object related to the teenager years of a person qualify for nostalgic value. Even simple robots or AI-assisted objects may qualify for this in future. Artificial friends will be like tamagotchis in need of repairs.

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Repairs again

Trying to repair electric or mechanic devices is confronted with multiple obstacles. Spare parts are hard to come by and many pieces needed are no longer in stock. Hence, in many instances the remaining option is to use recovery pieces from other broken or discarded devices. Whereas this is still common for repairs of vintage cars, for example, this is rather rare for consumer electronics like stereo music players or television sets. An aging clientele of the repair market is very used to a specific device and is often reluctant to change habits. 

An additional element in the repair process is access. Only in thinking repairs into the engineering and design of the device will make repairs feasible later on. An economy and business model which is based upon a high turnover as the basis for profitability has no interest in engineering for repairs later on. This makes a preservation of resources tricky. Disassembling is a necessary but not sufficient condition for the repair sector to thrive. At least the basic materials enter into a circular economy as a first step. Further steps consist in preserving the skills needed to disassemble and/or repair more. The habit „buy a new one and throw away the old one“ is hard ro change. 

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Permanently anxious

„There’s a set of forces that want us to be permanently anxious“, is the phrase chosen by Tony Cokes in the exhibit just outside the „Palais Populaire“ in Berlin in 2025-5. International politics and the economic upheaval caused by Trump’s tariffs contribute to the already existing other sources of anxiety like nuclear energy and warfare. Global warming causing more extreme weather events add more man-made reasons for anxiety. The next generations will have to foot the bills we have left to them unpaid. Our current shortsightedness increases anxieties which previous generations have not known of a similar kind or in that combination. 

Community building and solidarity are ways to overcome such overwhelming anxieties. Supranational organizations like the European Union have an even stronger role to play to reassure its people with credible signs of solidarity. We are not alone in the struggle to overcome the anxiety that is creeping up around us. We are certainly stronger together than individually dealing with unspecified fears. „We shall overcome …“

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Marx Home

The home of an influential philosopher, economist and political scientist is not easily presented like a home of a musician, a composer or an author. However, the home of Karl Marx in Trier on the Moselle river succeeds to present the biographical links of growing up in a historic city, the bourgeois upbringing of the young Marx and his formation as an independent and even revolutionary thinker of the economy and society. In 2025 the home is a museum supported by the Friedrich Ebert Foudation with a great online guide and access to additional scientific material. For authors like Karl Marx it is always of interest to follow not only the origin and evolution of the thought process, but also the shifts in the reception of his writings by subsequent generations. This part of the exhibition and an audio guide (downloadable as App).

In 2025 with an apparently ruthless capitalism at work in the biggest economy of the globe, the reminder that the economy is best to be understood as a political economy, which focuses on self-interest and profitable business deals, we find in Karl Marx still a worthwhile reminder of economic development even in the 21st century. The note-taking and studies in Exile in London are well documented in the tiny home and museum. Studying the misery of exploitation in supply chains and international commerce remains a topic of continuing interest as well. 

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Retirement Plans

There are debates about the best organization of retirement. The major fault lines lie between public pension systems and systems that are built based on mainly private provision. Retirement plans in either system are subject to constraints. The recent stock market turbulence has increased the amount of uncertainty people face who invested in 401K plans in the US. Some had to take an unannounced hit to their retirement savings due to the loss after Trump’s back and forth policies on tariffs (OECD Pension Outlook). High volatility of stock market prices creates an additional constraint that you are less inclined to retire when your retirement investments have overall a reduced value. You are a bit at the mercy of capital markets even in your retirement decision, irrespective of the difficulty to predict what your retirement funds will yield as returns. Quite an important lesson to keep in mind when comparing retirement systems in OECD countries. It has been all too easy to blame public pension systems for maybe lower short term interests on pension savings. Being subject to an American president concerning your retirement plans is probably not what many countries would like to have. Trump’s choices on tariffs may have consequences we did not expect to affect us so directly.

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Tariffs Trade Deficits

US Tariffs target the US trade deficits across the globe. For a start on the topic it is helpful to take a look at the data. The US bureau of census publishes this time series regularly. Currently, you can compare monthly or annual data across countries from 1985 to 2025. The worsening of the trade balance is obvious just looking into some examples like trade with the EU, China, Japan, South Korea or Switzerland. we might calculate some rough indicators of trade deficits of the US with countries by the size of the country, which would make Switzerland look really bad relative to many much more populous countries. This probably explains why Switzerland is threatened by higher tariffs than the EU. However, this hints towards the “hidden” agenda of tariffs on countries. The major targets are multinational companies that produce in countries outside the US and particularly in those with low corporate taxes, like Ireland and Switzerland. Importing products from such countries worsened the US trade balance over decades.

Another factor to study more precisely is the sectoral pattern driving the trade deficits with countries. Exports in for example health-related products have soared due to Covid-19 pandemic starting in 2019. Where did the US buy face masks, ventilators, medicines and pharmaceuticals?  These countries will now also be penalized by higher tariffs. The tariffs topic is a complex interconnected business issue, which is not solved by blunt measures. The real danger is that with each month trust in US will erode further. For decades this has been an underestimated currency of international business. Eroding trust is likely to be the major fallout of the tariff and trade deficit nexus. It takes decades to build, but can be destroyed within a few days or weeks. (Image: Mont des arts Brussels February 2024, celebration of surrealism).

 

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Value destruction

The destruction of economic values as they are embedded in quotations on national and international stock exchanges has reached levels after the US tariffs announcements of unprecedented levels. Only the banking crisis had reached similar levels and bursting speculation bubbles. Whereas professional investors might have seen this coming, the normal small investors who had hoped for a positive effect of Trump’s economic policies on shareholder values, which occurred right after the election has been wiped off already. For those people who rely on stock market investments for their pensions have to digest heavy losses now. The second round effects of reduced consumption of pensioners who have lost 10% of their retirement savings will further aggravate the situation for this group of people. Paired with higher expected inflation the economy will be forced into a recession caused by Trump’s tariff announcements and enactments. As this will lower prices of oil and gas as well as other raw materials, his electoral base of tycoons following a « drill baby drill » device experience also losses. A lot of damage all around him leaves millions of people in the US with losses to digest. Probably even more across the world, particularly in the poorest countries of the world. Such a real world macroeconomic experiment is like playing poker on a global scale. However, many countries may build new alliances that may wither the storm better than Trump anticipated. Hence, the game of poker will reenter economic textbooks again in addition to game theory and maybe chess strategies. (Image winter sunset).

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Rich richer

The US economy under Biden had continued to make Americans richer. In an article by Talmon Joseph Smith in the New York Times from 2025-4-3 p. 7 the puzzle that Americans have grown richer, but don’t feel it, has been well explained. The large share of households owning their homes albeit with mortgages from low interest periods have witnessed their increased wealth. However, inflation is eating into their cash available for daily purchases. With another round of tariffs and additional inflationary pressure caused by those, the average person or household doesn’t fell much better off than some years ago. Economic anxiety and our preference for loss aversion or loss avoidance make us react with consumption restrictions to prepare for increased risks as well increased uncertainty about the directions of the whole economy and our very private wealth and consumption patterns. How and when the US economy will get back on track remains to be seen. Higher uncertainty usually reduces investments and with increasing interest rates again the economic recovery might be protracted. The NYT p.7 cites business owners with statements like “we’re not putting our foot on the brake, but we’re taking our foot off the gas.” Betrayel of working class people due to rising unemployment after 3 years of very low unemployment is likely to widen wealth gaps in the US population even further. The rich will get richer, but at high costs to the population as a whole. (Image: ceiling painting in Petit Palais, Paris).

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Tariffs trumped

Economists are used to differentiate between micro-and macro-level effects of tariffs. For each buyer of a car, import tariffs raise expectations about prices for a product. Many consumers will then decide to buy lower quality at the same price or postpone buying a new or replacement product for some time. For cars it might mean that many people will then decide to buy rather later than sooner. If thousands of people do so, the market will fall into recession overall and it will take months or years to come back to the same or a higher level. A political economy perspective has taught us that eager politicians are in favor of a short recession immediately after an election which increases the chances of re-election once the economy gets back to normal or catches up on lost growth. 

The US under Trump apparently gambles with such an economic rationale. Short term inflation is already rising, interest rates stay high before the upheaval caused by tariffs starts to settle. 

There is, however, another alternative mechanism at work as well. Thorstein Veblen long ago hinted towards what is not called in economics the Veblen effect. Some fancy cars for example can raise prices well above others because of their cleaving image. Just because they get even more expensive the buyers of such products gain additional attention as part of a social class which does not have to care much about their additional spending. The consequences of tariffs will most likely widen the gap between those saving dearly and those able to splash out cash despite increased tariffs. The most felt consequences, therefore, will be on social inequality within the US (compare WSJ 2025-4-24 A2 by Juliet Chung, “Richest of Rich Gain §1 Trillion”).

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Design skills

The is a huge B2C or C2B market in connection with home design and adaptations. Nowadays people are inspired by instagram, pinterest, YouTube and TikTok. Additionally, many play around with Apps to create their own images of how they would like to arrange or rearrange their home. Some have taken first steps to include measurements of their home in the design. The compatibility with professional software of the construction sector, however, is a drawback that delays or leads people to go to enterprises that take into account the prior efforts of young lay designers. It is a little bit like an own contribution in home building quite popular among new home builders to alleviate the upfront cash needed for first home acquisition. The younger generation could offer some of their “digital native” skills to bridge the gap in construction and home design. Of course, reworking and precise measurements on the location will still be required as construction has a lot of legal liability issues involved. Cooperation is a form of burden sharing to advance faster and/or with lower costs.

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Unwinding USA

Stock markets move largely due to expectations. Therefore, the mixing of economics and politics can create lots of signals, which are likely to raise price expectations. Inflationary pressures will call for central banks to increase interest rates which will reduce economic activities that are largely financed through the credit market.
The unwinding of the economy reduces turnover and most likely also profits of companies. The fate of Tesla cars in the last 2 months (Link) and the stock market value of Tesla shares (Link) have plummeted. The unwinding of shareholder value and inflation on the rise as well are a the effects of the MAGA narrative and Musk‘s appointment in politics as chief of GOPE.
The „home made recession“ in the US and the choice to prioritize own products might work in the long run, but the costs of the short-term induced inflation will affect vulnerable consumers more than the people who buy many products that show few price increases. The unwinding of the economy of the USA is likely to cause shock waves rippling through the global economy.
Image: Prices to charge e-cars with solar energy in Germany according to sunshine.

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Corruption Caught

In fraud or corruption it is primordial that the probability to be caught is very high to deter potential fraudulent activity. The new Trump administration has enacted as one of the first executive orders that the FCPA stops to take on new cases of suspected corruption as well as reconsider some of the running procedures. In the same vein, the Corporate Transparency Act (CTA) has been silenced so that American companies to not have to disclose ownership information that fall under the CTA until 2025-3-21 until a major reform will be published.
These policy shifts concern more than just US citizens. The competition between countries will be effected because as companies trading with the US which used US bank accounts were also liable under this legislation and subject to prosecution. The FCPA has been an important example for other countries to follow at least within the Member countries of the OECD. The shift in priorities of the Trump administration might open doors again to corruption which we believed were shut with lasting effect.
In conjunction with the rapid increase in military spending when the capacity for the production of military equipment is slow to increase might increase the risks of corruption talking hold again. Market economies build on fair competition, but less prosecution of corruption introduces a bias into negotiations which works against innovation and competitiveness. We have a hard time to understand any kind of logic in such economic and legal strategies.
Image: Bridge collapsed due ro material defects. Archive Berlin Tempelhof Schöneberg.

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Betrayal Politics

Most economists would hold that in free market economics there is no room for moral statements. Betrayal, therefore, is left out of most standard text book economics courses. However, more advanced courses that include strategies based on so-called “game theory”, where actors may breach prior commitments, betrayal has entered economic science. A “tit-for-tat” strategy is frequently the best “game-theoretic” solution to such strategic behavior to deter also repetition of defecting on agreed rules or bargaining outcomes. For real world applications beyond the simple strategic advice, the maths involved are quite challenging. We’ll check soon, how AI is changing that game.
Another popular economic theory is one of “gift exchange”. You gift a sum of money (or weapons for self-defense to a country) with no explicit consent that the money should be repaid (through rare earths) in peace time. A betrayal occurs, if a country suddenly asks things in return for the previous gifts. For politicians that understand themselves as “market marker” and “deal maker”, there will be a tendency to claim back a gift in order to come to some kind of gift exchange rather than an altruistic donation.
William A. Galston wrote in the WSJ (2025-2-26) naming the US political action of the 2nd Trump administration a “betrayal of Ukraine and American values”.
If free markets mean making ruthless use of “tit for no possible tat” and “gifts are always a gift exchange”, we move back to mercantile and medieval practices, where settles could claim land at gun point.
What way out of this? Adam Smith, champion of classical economics, wrote before his famous book on “The Wealth of Nations” a lesser known, precursor book on “The Theory of Moral Sentiments”. Actually, he was convinced that the one would not work without the other.
Maybe, going back to classical economics is much better than a Trump administration version of neo-classical economics in a new era of political economy 3.0.

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More BRICS

The move towards a multipolar world order is in full swing. With the USA retreating from a primordial international role discarding UN institutions and the defense of major elements in the fight for individual freedom, the diplomatic order of the last 80 years has changed. The liberation of the concentration camps in Germany and the 80 years of the end of the 2nd World War on 1945-5-9 had forged an alliance in which the common enemy was defeated and the the next major confrontation in Europe or on the globe had to be warded against. 

The evolution of peace in Europe has been marked by the Cold War and a bipolar world order which confronted the USA and Russia at various places. The rollback of Russia has seen its high time with the Northern and Eastern extension of the EU and NATO. This goal of US strategic interests has been largely accomplished. 

In the shadow of this bipolar relationship the BRICS have moved towards greater economic power and therefore influence in the international arena. Economic data on the biggest economies in the world over the last years show the rise of the BRICS, bit mainly China and India. Their population sizes create enormous and largely shut off internal markets. All these developments create new challenges to the previously relatively stable world order. Technological advances have been narrowing more rapidly than before since the access to the best available knowledge spreads fast and more equally across the globe through the internet. 

The ugly face pf imperialism is returning front stage and attempts to change the previous versions of imperialism into a new hegemonic world oder. Updated views of economic power and influence zones let us look with a rational perspective on the new power play. Due to the containment of Russian influence, the USA has China as the major power to confront, a major shift as of the 2020s. The China-driven Silk road project with strategic landing points across the globe has „trumped“ American efforts to align BRICS to human rights values over the last decades. European diplomacy will have to recognize that we entered another phase of „Realpolitik“ due to major economic shifts over several decades. (Image: extract from Max Klinger, The walkers, ambush, 1878 in Berlin SPK).

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Sustainable Food

Climate change has a severe impact on sustainable food production. The OECD reports annually on the evolution of volumes of production and monitors the resources and subsidies allocated to the agricultural sector of the economy. The sector and the whole nutrition chain are frequently perceived as a major driver of shrinkflation, greedflation and cheatflation.
Changes need to be introduced with a medium and long-term perspective in order to allow for smooth adaptations of the sectors involved and to avoid so-called hog cycles.
Most economic debate is focused on the quantity of production. The loss of production due to climate change and Russia’s war in Ukraine has been and continues to be substantial causing starvation and premature deaths. Another issue is the lower quality of food due to droughts. Repeated events call for adaptations. Certainly the adaptation of more resistant crops is part of the answer. However, the other side of the same coin consists in the consumer’s readiness to buy products that suffered during a drought. Just as the reduction of fertilizers and less water in the production of droughts reduces the size of fruit, for example, we, the consumers will be systematically challenged in our purchasing habits of fresh food.
Price-sensitive consumers will have to choose the products that have reduced prices due to drought quality loss. Other consumers may choose the drought affected product if a “resilience message” is attached to such products. Solidarity with climate affected farmers, just like bio-farmers’ products in ecological production, opens up another perspective to more sustainable consumption and farming.

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Existence as Eggsistence

Artists have their own ways of hallucinating. They don’t need an AI to generate ideas beyond the normal, even allowing for 2 standard deviations off the usual. As a result of the thorny question about your existence, Ram Katzir came up with the impressive statement about his „eggsistence“ being subjected to a squeezed experience. Ever increasing shares of the labor force would subscribe to this statement about the modern workplace. Each turn of the screw risks to crack up the egg‘s shell. Rather focus on the egg, try to get a grip on the screw. There are thousands if not millions who crack up under the excessive pressure of economic and political circumstances. The new platforms of food, grocery and parcel delivery at home have become the latest example of AI-assisted and algorithmicly managed screws. What is driving your eggsistence. It is about time to  ask fundamental questions again. (Image: Eggsistence, by Ram Katzir 2021 in Brussels, Galilas Collection Belgium)

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Corridorisation Connectivity

In some cities, “I love Paris” (Jazz Song), we admire the “breath-taking” large corridors, right in the centre of the city. This has been the outcome of the urban planning in the 18th century. Haussmann designed large parts of Paris with huge corridors despite the medieval narrow streets in some of the arrondisements”. Ease of traffic, fewer riots and representative housing became the new mantra of urban planning and superb boulevards.
In the 21st century it is about time to question the notion and social process of corridorisation. This has been accomplished in a paper by Fatima Tassadq et al. (2025). Modern infrastructure like fibre-optic cables, energy or water networks are easiest to deploy in urban spaces with large corridors than the complex narrow inner cities with supposition of different kinds of network layers. The grand ideas of the 18th century should be questioned from time to time and some districts that have escaped the corridorisation might well have a particular charm about them, maybe just because they seem to escape the rational approach of making and structuring space by means of large corridors. Large corridors separate city districts and they are a major driving force of gentrification.
The rationality of corridors has some roots in maths or physics of complexity. A recent paper by Shanshan Wang et al. (2024) reports the surprising finding that the transport corridors in several cities across the globe allow for a 1.3 times the distance of transport networks compared to the so-called direct linear “bird’s flight line”. Hence, corridorisation is (has been) a rather pervasively applied model of urban planning.
Alternative approaches advocate in favor of the 15-minutes walking distance city. All amenities like shops, schools, maybe work and services should be reachable within a 15 minutes walk. This does include “walking corridors” that facilitate (social) connectivity in inner cities. Cyclists also claim their corridors or fast lanes across cities, which underlines the pertinence to take corridorisation seriously and apply the concept with care.
In any case, social connectivity is key. The big social media platforms operate similar to the traffic infrastructure in the 21st century and provide huge corridors to knowledge and people. We only realize this once a service (for example tiktok) or the internet altogether gets disconnected. We have moved from (social) categorisation to (social) corridorisation as technology and rationalisation have taken the upper hand to structure our (social) lives.

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Cheatflation

There are many ways to study inflation. You may start by looking through your collection of bills. Economists like to swear by the consumer price index or indices, if you are even more into inflation. In textbooks like “economics for dummies” we learn about rational behavior and price adjustment mechanisms through the “invisible hand” to find some sort of equilibrium.
Advanced economics courses will teach you about strategic behavior inspired by game theory and the effectiveness/ineffectiveness of cheating. For advanced economists it is, therefore, inevitable that “cheatflation” should be part of the economists’ vocabulary. Of course, a profit maximizing entrepreneur is likely to way the risk of being found out contributing to cheatflation against the potential gains.
How to cheatflate? Too easy. Any producer of a product can cheat by using, for example, other ingredients than those printed on the product label, usually cheaper ones. Instead of fruit juice (wine) you may just sell colored water with lots of sugar (ethanol) in it, but still label it fruit juice (wine) and get away with this, until a consumer protection group makes a fuzz about it. A more sophisticated way is to sell investments in ESG-rated funds, but then include dirty stocks without proper notification in the fund, which probably increases profits based on wrong labels.
There is a specific quality to cheatflation, which makes it different from shrinkflation or enshittification. The drive to “obtain unfair advantages” through cheating across a whole country or region makes cheatflation an economy-wide process and subverts general fairness rules as well as trust in a society.
(Image Saccharometer, DTM Berlin 2024)

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Californication

In a song by the „Red Hot Chili Peppers“ the term californication appeared for the first time as far as I remember. This song is rather critical of the superficial californian way of life. The belief in the dream that you may get rich quickly in California has suffered another blow wit the thousands of homes burned in the wild fires in January 2025. Dry and arid areas are spreading and the lack of water makes it very hard for firefighters to protect homes, particularly in difficult to reach valleys. Stormy weather adds to the speed of fire spreading. All these elements are predictable additional risk of climate change. Californication is the old and new word to describe a trend of acceptance of increasing climate risks by at the same time neglect of environmental precaution. Hollywood is just around the corner there and the film industry might come up with some other narratives than just the previous californian dream. Get rich fast, then run away. Sustainability is a more difficult concept and yet it keeps getting more and more attention.

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Sociolegal Circularity

At times legal systems feel like going round in circles. Legal procedures move from one stage to the next and they may get referred back to the previous instance to resolve a particular issue or restart the procedure. This has good reasons with the aim of “doing justice”. Sociolegal circularity, however, begins before the, right at the beginning and negotiation of legislation on which all legal systems are based in democracies, that is. Hence, the legal definition of waste, recycling as part of the circular economy and society is rather crucial.
Circularity is a complex sociolegal issue as the example of PFAS in plastics demonstrate. In economic theory the existence of externalities invites profit seeking of the kind like: “the sea in large part is owned by us all and there is no price attached to the (ab)use of it. Dumb PFAS into the sea, because the costs of cleaning up will be shared by all of us”. In order to limit the extent of this economic logic, we have to rely on sociolegal processes. The precise definition of property rights and liabilities beyond the PFAS issue have to be well-defined. It is an intergenerational topic as well, not only in view of deferred payments.
Parliaments have to be rather competent to look through all the complex issues of producing and recycling of materials to make sound provisions in law including future generations. Going round in circles in parliament is yet another element of necessary condition of circularity in a rather broad sense.
The air we breathe and the water we drink have become part of this “economic externality”, which is a very internal, inside of our body kind of sociolegal affair. Who is responsible for the bad air we breathe and the contaminated water we drink? Air and water have for a long time become marketable products. The more your local water is polluted, the more we are forced to buy water. The more the air in inner cities is filled with fine dust particles, the more medical doctors, hospitals and rehabilitation facilities we need to construct.
For GDP calculations these are win-win-win situations, although they make us all worse off. Society and politics are in charge to define and redefine (yes, circles again) the legal basis with a lot of precision and scientific detail. Sociolegal circularity is key. You just have to turn it in the right direction.
(Image, Palais de Justice, Brussels view from Forest district).

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Socioeconomic Circularity

Some sectors of the economy receive a lot of attention, for example sectors selling fancy cars. Other sectors, like the ones regrouped under the name of circular economy, receive much less attention and show up little in headlines. In fact, the circular economy is a great example of this. There are thousands of waste and rubbish collection, sorting and recycling centers, several hundreds of waste-to-energy plants, composting sites across the European Union. Of course, there is also a European Federation of the sector (FEAD). On the last FEAD conference in Brussels 2024 it became clear that Europe is finally waking up to the challenge of recycling costly raw materials.
The narrative concerning the sector needs to change further: what used to be subsumed as costly nuisance is in fact a potential profit center for companies and society at large. We do no longer want to import lots of raw materials from countries with dubious social and environmental records as part of our supply chains for raw materials. Time to act. This, however, is a rather complex socioeconomic challenge of circularity. The price mechanisms are not fully functional in most Member States, let alone across the EU. Additionally, the social practice to recycle varies greatly between countries. Distributional issues matter as well. It is rather obvious that dumping waste from one region/country in another one has huge implications (nuclear waste), but if one country values waste more than another one, due to innovative recycling techniques, the matter takes a marketable turn. Regulation should carefully distinguish categories of materials as we do for hazardous materials in production, consumption and for health and safety purposes of employees.
Metal, battery, cement, plastic and wood recycling pose challenges, but also opportunities to improve the European material import/export balance sheets. However, first in the circle of circularity is the use of materials. There we are clear that “less is better”. Less input of raw materials, most of which we import in the EU, reduces our dependence on other countries. This is the tricky social question of circularity. Mainstreaming of more conscious use and reuse of resources is a huge social issue, which we tend to relegate to a task for the education system. The awareness that supposed waste is also a valuable resource is spreading and the growth of the sector a business and employment opportunity for many. Circularity is the new sexy sector of the 21st century.
What have you recycled today? and myself? Well, scientific online publications. Now think of ChatGPT and the AI gold mines of 2024. There is lots of value in recycling.
(Image FEAD conference Brussels, 2024)