Both smoking and vaping are big business. Nicotine is well known for its addictive capacity. Once started, it is very hard to give it up again. For many decades we devote considerable efforts and costs to encourage people to give up on smoking or, better, not to start smoking in the first place. The young are particularly vulnerable as damages persist for a longer time. Progress has been made to reduce passive smoking of children and people in restaurants, at work and public spaces. The relatively recent trend of vaping instead of smoking is considered less harmful, but scientific long-term evaluations, whether these effects are lasting for several years, are still missing.
A repeated cross-section study in England (Tattan-Birch et al. 2024) has revealed that the declining trend of nicotine use has already been reversed among youth due to the rise in vaping. Vaping seems to move from the fashionable niche product to the popular mainstream among youth. The addicts are only cost-sensitive on the margin. The relative prices of smoking and vaping might play a role to put people on different health trajectories. The question is not between either smoking or vaping, but for some it is both, although it should be none of both. The question of smoking yes/no is likely to be framed as either vaping/or smoking. The re-framing of the question shows the harmful potential in the longer run. We shall have a hard time to convince people and particularly youth not to be tempted by either/or but to focus on their long-term health trajectory and potential. (Image: Extrait from Arnold Böcklin, Self-portrait with death playing the violine 1872, Alte Nationalgalerie Berlin) 
Aussensicht Innensicht
Die Sicht vom Skulpturengarten der Neuen Nationalgalerie auf die laufende Ausstellung „Zerreissprobe…“ erlaubt einen tiefen historischen Einblick in die 1980er Jahre. Die Sammlung von Postern des Künstlers Klaus Staeck zeigen die bewegenden Themen der achtziger Jahre. Frauenrechte, Umweltschutz, Sicherheit sowie Medienwirtschaft. 40 Jahre später beschäftigen uns weiterhin, Lösungen für die plakatierten Themen zu finden. Images können Themen so zuspitzen, dass Anklagen daraus werden. Texte sind im Vergleich zu der Eindrücklichkeit der Bilder ein vergleichsweise stumpfes Schwert. Es ist aber gerade die Verbindung von Bild und Text, die Eindrücke verstärkt. „Meme“ Creators sind ein standard tool das die Kommerzialisierung und die Promotion weiter befördert haben. Kunstformen hatten diesen Trend bereits vorweggenommen.
Adaptive Expectations
In economics it is important to understand the concept of adaptive expectations. We all form expectations about prices and inflation, but there is more than just simple expectations. These expectations guide our behaviors in many domains. If we expect a drastic price change for goods and/or services we shall most likely modify our behavior in response. We might want to advance a purchase to take advantage of currently lower prices in the expectation of higher costs later on. Most people would follow the price changes on a regular basis and adapt their expectations according to the updated information. It is an important process as there are millions of people who do this and this process drives price levels in many countries. In Europe we would like to see not only inflation, but also expectations about inflation to be around the target level of 2% per year. After the high price rises of energy and food (Putin’s war) as well as the disrupted supply chains (Covid-19 crisis) we were unsure, whether we would have to adapt our expectations for the coming years. The credit crunch in the last few years forced people to adapt spending plans and expenditures. We seem to have overcome these major crises due to rapid adaptive expectations. The crucial mechanism to achieve this is a timely and open communication of changes. Media have a role to play to not only spread the information, but to explain underlying reasons. This contributes to a widespread understanding of basic economic principles that helps countries to navigate stormy weather. It is like players of chess who adapt their strategy after the other player has acted or not according to their expectations. It’s simple, isn‘t it?
Bikenomics
There is a whole cluster of enterprises associated with bicycles. Selling a bike is only the first we might think of. Repair works are the most tricky part of bikenomics, a bit like bidenomics. In many cities during spring and summer it is even more difficult to get an appointment for bicycle repairs than for a doctor’s appointment, and that can be hard at times. Shortages of skilled technicians are pervasive in this sector. DIY for do it yourself is the best alternative. With the arrival of e-bikes and the digital connectivity the skill set has been enhanced recently as well. Insurance for bikes, lockers, helmets, airbag system or clothing including spectacles are part of the standard safety and security set of bicycle riders nowadays. Many, many job opportunities there and the willingness to pay for bicycles has steadily increased over the last years.
Berlin has just seen its 48th bicycle demonstration in 2024-6 on roads including 2 motorways with several ten thousands of participants. In a star like fashion multiple tracks met at the city center. The final meeting with stands and information was at the Deutsche Technik Museum with refreshments and repairs. The exhibition of cargo bikes and taxi bikes or “rickshaws” was another highlight. We need to rethink our mobility concepts and try to get the sharing to work more comfortably. For different purposes and activities you need a different bike. Ownership of each is no longer adequate as for example with aging alone your preferences for mobility with bikes also changes. Sharing is caring and this is also part of bikenomics.
Cars electrified
It is not only cars, but the whole automotive industry that got somehow electrified. The U.S. have imposed a 100% tax on electric cars produced in China recently. Europe is feeling the heat as well (compare Fressoz in Le Monde 31.5.2024). Production of cars is not a for fun activity. It is firmly embedded in our economic system which believes in profit maximization even at high environmental costs. Therefore, the production of cars follows the logic to build cars that generate the highest profits. Bigger cars yield bigger profits and this has been known for decades. Why should we expect our car producers to deviate from this logic. Investors push hard in this direction as well. Small e-cars generate small profits. This can only be economically valid if large numbers are produced. China’s home market has the market size and air pollution levels that make this a viable strategy also for the lower income people. If not sold in the US or Europe, the home market is able to absorb huge amounts of electrified cars. Downsizing of cars needs to happen particularly in inner cities. The implementation of this is not going to be easy and without resistance.
Killing me softly
The problem with pollution is, it is killing you softly from inside. It is almost impossible to escape air pollution as it is pervasive in cities, but also in the countryside where you do not expect it that much. This is the result of the study by Kuzma et al. (2024) published in “The Lancet Regional Health Europe”. Based on a data set of 8 million persons from Eastern Poland the effects of air pollution on myocardial infarction incidence was analysed. The use of the “European Union’s Earth Observation Programme” contributed data on air pollutants like PMs, BaP (benzo(a)pyrene), SO2 and NO2 concentrations. The multi-level data of 5 voivodeships, 101 counties, and 709 communities in Poland allows to differentiate the effects of damage to the heart tissue on cardiovascular disease. The other well-known factors are arterial hypertension, diabetes, obesity, chronic kidney disease, hyperlipidaemia, and smoking as most of us know already. The effects of BaP (benzo(a)pyrene) is shown for rural areas despite the lower observed traffic density in these areas. The killing occurs softly from within our bodies by just breathing in and out, and in and out continuously. The disease burden in these regions is observed with “recorded 63,154 hospitalizations and 5921 in-hospital deaths (9.4%) due to STEMI; and 76,543 hospitalizations and 4079 (5%) in-hospital deaths due to NSTEMI”. In short, the need to reduce air pollution further is an urgent demand that saves lives eventually.
(Image from public domain wikipedia or “do-it-yourself” here).
May 1st
More people take to the streets on the 1st of May in Germany. The costs-of-living crisis with high inflation has increased the claims for pay rises for workers and adjusted wages for employees. We all have observed “greedflation”, i.e. excessive company profits in several sectors. Additionally, “shrinkflation” has affected consumers in their daily shopping experience. Political efforts to curb inflation have taken a long time to come about and most initiatives have ended already (Energy sector). This spurred a new drive for trade unions to come out in huge numbers to protest and claim adequate wage increases to cover the increased costs of living. In Germany the DGB informed on the annual 1st of May demonstrations across the country about a strong new entry movement of members of 400.000 persons. It is higher than the loss of members of the large baby boomer cohorts who retire.
Through a broad and engaged membership the pressure on higher wage settlements will persist. Companies have used the crises to generate extra profits. It is only fair that those employees who largely contribute to the success of a company will claim their share as well.
For society as a whole it is important to consider that the discrepancy between managerial pay and shop floor wages do not increase further. The social fabric of societies is in danger if perceived injustices grow. More radical forces can all to easily exploit this causing a severe danger for democracies. Meeting people on the 1st of May and joining forces across sectors and trades ensures that a society continues to build and rely on solidarity. High inflation times are a great reminder of the economic basics of societies in history as well as today. 
Comparative Advantage
In economics all students go through the calculus of comparative advantage. People, regions or whole countries tend to apply comparative advantage to their production systems and ensuing internal or external trade. The basic rationale developed by David Ricardo has not changed that much over 200 years. The fields of application, however, are continuously expanded. Lindsay and Gartzke (2020) have applied the comparative advantage rationale to military strategy. The paper quotes 26 times Clausewitz and demonstrates the links of strategy to the basic economic and social rationale of comparative advantage. It is the politics of production that even the presence of trade may override the rationale of comparative advantage to favour local production of “operational domains” or military equipment.
In Russia’s aggression and war against Ukraine own production and trading of weapons has returned to the forefront of the concerns. In addition to the production of ammunition, the provision of drones has dominated the international arms trade related to the Russian aggression. Resources and time for production are additional factors that have an impact on availability of weapons at the right time at the right place and with the sufficiently trained persons to operate them.
The strategies that cross domains or combine domains seem the most promising. The careful analysis of your own comparative advantages or disadvantages needs to be the basis of any strategic decisions. This has been known for 2 centuries at least and is still valid in many fields of application. Additional considerations for “home production” might add to the complexity of the issue. Sustainability has also found its way into the field of comparative advantage at last. This may alter the analysis of comparative advantage of operational domains as well. Lots of unresolved puzzles still around. It will need years to sort this out despite the urgency of the Russian aggression on Ukraine.(Image: AI Copilot.2024-4-30 2 political leaders deal weapons. One has a comparative advantage in ships. The other one has a comparative advantage in aircrafts. they deal together)
AI Disruption
Many scientists started to question the disruptive potential of AI in, for example, the military’s domain. The Journal of Strategic Studies featured 3 papers on AI and autonomous systems more generally. The major argument by Anthony King is the reliance of autonomous systems on other systems mainly human operators even in the background to get these systems off the ground and maybe back again. Not only logistic support but also satellite communication is needed to guide and protect the operations. In quoting Clausewitz, Anthony King stated that war is a “collision of two living forces”. Strategy and counter-strategy will co-evolve as will attack and defence.
Jackie G. Schneider and Julia Macdonald (2024) advocate the use of autonomous and unmanned systems for their cost effectiveness. Economic costs as well as political costs are lower for these new strategic weapons. Mass fire power from swarms of drones is much cheaper than nuclear warheads and the home electorate is assumed to be more willing to accept and support limited and more precisely targeted unmanned missions. The disruption potential of AI is huge but it is most likely an addition to the arsenals than replacing them. (Image 2 swarms of drones fly in the air above tanks, created by AI – copilot-designer 2024-4-29).
Fertility Growth
The first association of fertility and growth is likely the growing of fertility rates in a country or region. Only macro economists associate the growth or decline of fertility with the macroeconomic consequences of more or less economic growth. Countries with higher fertility rates in most cases have higher growth rates as parents spend more on food, clothes, mobility and education. Accommodations are changed, adapted and refurbished. Estimates of increased consumption per child by economists range from 500.000 to almost 1 million in the highest developed countries. Children are a country’s wealth, but they also cost a fortune in monetary terms. Good news for the economy if families keep spending independent of economic cycles. More children keeps dedicated shops running or even a whole sector of the economy. In recessions the downward pressure in this sector becomes an additional challenge not only for the families but with ripples-on effects for the whole economy and society. If you see shops closing which has sold furniture for children for the last 15 years then the realization of an economic downturn becomes also more real. Sometimes the parallels in the news of declining fertility and increases in pensions do not square well with the fitness for the future or the future orientation of a society. Democratic voting rights that give families more weight in elections could change this. It is not yet on the political agenda.
