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Microeconomic Savings can convert to Macroeconomic Costs

Hanns-Jürgen Hodann
Microeconomic measures can produce counterintuitive 'emergent' effects at the macro or systemic level. The commendable act of saving money by individuals during uncertain economic times has the perverse macroeconomic effect of making a recession  worse: in aggregate there will be less money available for spending, suppressing demand for goods and services. Economists call this effect 'the paradox of thrift'. Similarly, logical efforts by companies in such conditions to reduce their wage bill or their postponement of investment decisions will reduce spending in the economy  and deepen the economic downturn.

What can be done to counteract this harmful dynamic? The missing spending can be replaced by government spending: governments have it within their power to effectively counter economic downturns!

Economy Emergent Phenomena Fiscal Spending Paradox Of Thrift

  • 3 years 7 months ago

Energy transition to lower EROI sources (v2.8)

Josh Floyd
A detailed description of all model input parameters is available here. These are discussed further here and here.

Update 6 August 2018 (v2.8): Updated historical wind and PV deployment data for 2016-2017, adding projected PV deployment for 2018. Data via and
Update 26 October 2017 (v2.7): Updated historical wind and PV deployment data for 2015-2016, adding projected PV deployment for 2017. Data via and
Update 18 December 2016 (v2.7): Added feature to calculate a global EROI index for all energy sources plus intermittency buffering (currently batteries only, but this could be diversified). The index is calculated specifically in terms of energy services in the form of work and heat. That is, it takes the aggregated energy services made available by all sources as the energy output term, and the energy services required to provided the buffered output as the energy input term.

Update 29 June 2016 (v2.6): Added historical emplacement for wind and PV capacity. The maximum historical emplacement rates are then maintained from year 114/115 until the end of the model period. This acts as a base emplacement rate that is then augmented with the contribution made via the feedback control mechanism. Note that battery buffering commences only once the additional emplacement via the feedback controller kicks in. This means that there is a base capacity for both wind and PV for which no buffering is provided, slightly reducing the energy services required for wind and PV supplies, as well as associated costs. Contributions from biomass and nuclear have also been increased slightly, in line with the earlier intention that these should approximately double during the transition period. This leads to a modest reduction in the contributions required from wind and PV.

Added calculation of global mean conversion efficiency energy to services on primary energy basis. This involves making an adjustment to the gross energy outputs for all thermal electricity generation sources. The reason for this is that standard EROI analysis methodology involves inclusion of energy inputs on a primary energy equivalent basis. In order to convert correctly between energy inputs and energy service inputs, the reference conversion efficiency must therefore be defined on a primary energy basis. Previously, this conversion was made on the basis of the mean conversion efficiency from final energy to energy services.

Update 14 December 2015 (v2.5): correction to net output basis LCOE calculation, to include actual self power demand for wind, PV and batteries in place of "2015 reference" values.

Update 20 November 2015 (v2.4): levelised O&M costs now added for wind & PV, so that complete (less transmission-related investments) LCOE for wind and PV is calculated, for both gross and net output.

Update 18 November 2015 (v2.3: development of capital cost estimates for wind, PV and battery buffering, adding levelised capital cost per unit net output, for comparison with levelised capital cost per unit gross output. Levelised capital cost estimate has been substantially refined, bringing this into line with standard practice for capital recovery calculation. Discount rate is user adjustable.

Default maximum autonomy periods reduced to 48 hours for wind and 72 hours for PV.

Update 22 October 2015 (v2.2): added ramped introduction of wind and PV buffering capacity. Wind and PV buffering ramps from zero to the maximum autonomy period as wind and PV generated electricity increases as a proportion of overall electricity supply. The threshold proportion for maximum autonomy period is user adjustable. Ramping uses interpolation based on an elliptical curve between zero and the threshold proportion, to avoid discontinuities that produce poor response shape in key variables.

Update 23 September 2015 (v2.1): added capital investment calculation and associated LCOE contribution for wind generation plant, PV generation plant and storage batteries.

**This version (v2.0) includes refined energy conversion efficiency estimates, increasing the global mean efficiency, but also reducing the aggressiveness of the self-demand learning curves for all sources. The basis for the conversion efficiencies, including all assumptions relating to specific types of work & heat used by the economy, is provided in this Excel spreadsheet.

Conversion of self power demand to energy services demand for each source is carried out via a reference global mean conversion efficiency, set as a user input using the global mean conversion efficiency calculated in the model at the time of transition commencement (taken to be the time for which all EROI parameter values are defined. A learning curve is applied to this value to account for future improvement in self power demand to services conversion efficiency.**

The original "standard run" version of the model is available here.

Energy EROI Economy

  • 2 years 10 months ago


Hanns-Jürgen Hodann
​In a recent report, the World Economic Forum considered that the use of robots in economic activity will cause far more job losses in the near future than there will be new ones created. Every economic sector will be affected. The CLD tries to illustrate the dynamic effects of replacing human workers with robots. This  dynamic  indicates that if there is no replacement of the  income forgone by the laid off workers, then the economy will soon grind to a halt. To avoid disaster, there must be enough money in circulation, not parked in off-shore investments, to permit the purchase of all the goods and services produced by robots. The challenge for the government is to make sure that this is  case.  

Robots Economy Social Employment

  • 4 years 3 months ago

The Dynamic that shows that Government Deficits benefit the Private Sector

Hanns-Jürgen Hodann
When people talk about a government deficit, they forget that this is only one side of the ledger. On the other is a corresponding non-government SURPLUS. The money the government spends is not lost but shows up in the private sector as income. When one talks only of the deficit then one can understand that many think it should be reduced or even converted into a surplus, but reducing the government deficit reduces private sector income and a government surplus forces a deficit on the private sector with a potentially devastating effect on private sector wealth and economic activity.  Unless the economy is overheating, government deficits are usually healthy. For countries that run traditionally a trade deficit, such as the US they are necessary to maintain economic activity. Consider this fact: for almost all of past 40 years the US and the UK have run deficits without any harmful effects!
This video by professor Stephanie Kelton contains evidence that supports the modle.

Government Deficit Economy Private Sector Wealth

  • 3 years 5 months ago

Top 5 Best Moisture Wicking Bras for Sweaty Boobs

Proff R
Do you often have sweaty boobs during summer or on any normal days? Sweaty boobs can make you feel uncomfortable, especially if you feel itchy or scratchy. Sometimes excessive sweating can cause infection, especially if you have a sensitive skin. You may have tried the ordinary bras but nothing works. You find yourself sweating profusely. You may need to try out the following best moisture wicking bras for sweaty boobs. They are recommended and approved to prevent excessive boob sweating because they are breathable, meaning they wick away moisture and sweat from your skin. Here they are:
  • Victoria's Secret Strappy Plunge Sport Bra

This is a moisture wicking sport bra that will keep you extra comfortable while you do your exercises or gym, and yoga. It wicks away moisture like a charm.

  • Wacoal T-Back Seamless Underwire Bra

This bra is well designed with moisture wicking technology. This entails special mesh-like material that helps keep air flow going as you jog, do yoga or lift weights in the gym. It is perfect for someone who wants to remain trendy and still super dry and fresh.

  • Hanes Women's ComfortFlex Fit Wire-Free Bra

If you want to enjoy every little bits of your summertime, you need to buy this breathable bra that not only wicks away moisture, but also keeps you looking fly and sexy on the sassy beaches.

  • Olga Play It Cool Wirefree Contour Bra

This is one of the best moisture wicking bras that are in fact made with a special technology - Chill FX lining that keeps you cool all day long. You won’t want to throw your bra away after a long day.

  • Bonds Flex It Bra

This is a preferable bra that is super lightweight with light padding. It is the best breathable bra for sweaty boobs in summer.

Boob sweat should not worry you considering that there are many best moisture wicking and breathable bras for women. Most of them are trendy and sexy, meaning that you will be comfortable wearing them. If you love doing yoga, jogging, or exercises, you need to buy the one or two of the above breathable bras for women and see how they prevent sweaty boobs.

What are you waiting for? You can also check out the following moisture wicking bra selections and buy yourself the best bra that fits you perfectly and stops excessive boob sweat.

NB: Also check out the best car seat sweat covers & protectors and best sweat suits for men

Economy Population Technology Health

  • 10 months 1 week ago

Why Affiliate Marketing is The Best Option for Kenyans Locked by CoronaVirus Pandemic

Proff R
Have you ever heard of earning passive income while you sleep or while you concentrate on other jobs, including full-time employment, and especially now that many Kenyans have lost their jobs due to Covid19 pandemic and are forced to work from home?

This is affiliate marketing or simply niche marketing. With your blogging and marketing skills, you can write good product reviews and guides that attract willing buyers, who purchase the products you promote on your website, by clicking the links that transfer them to the merchant site where they pay and receive the products.

What is Affiliate Marketing?

Affiliate marketing can be described simply as a business where you promote products belonging to other people via an affiliate network for a commission. It is a way of making some money by selling products through your website to the merchant website. Often, you are provided with a unique id that is found on the links you place on your site, which track the number of sells made through your website successfully to the merchant site. You end up sharing the profits made from selling the product through your website.

What are the Examples of Merchants or Affiliate Networks?

There are many merchants and affiliate networks available for you in Kenya. Of course, you can consider joining the merchant overseas, for example, Amazon, Clickbank, Share a Sale, Click Junction and many more. Personally, I joined the Amazon Associates Program, and I am planning to join other programs as well to build on my commissions. I blog about products that provide solutions to people diagnosed with Hyperhidrosis or excessive sweating on my website Always Sweating? Find a Fresh Solution Today.

There are still other locally available merchants and affiliate networks that you can explore. To find them you need to check for companies that sell different products at a large scale, sort of an online supermarket and you will find that they have an affiliate department where you can join and help promote their products for a commission in exchange. You can also check for sites that offer deals in Kenya and join their affiliate programs at a commission. Some of the examples to check include Jumia.

How can I Join Affiliate Marketing?

Affiliate marketing has been in existence for some time now, especially in Kenya. Mostly, whenever we hear of online writing or online employment opportunities, we tend to think that they only come from overseas. However, with a clear understanding how you can join affiliate marketing in Kenya, then you will know how to seize this opportunity.

First, if you own a blog or a website that attracts high traffic or if you are willing to build a blog that will attract high traffic, you can join an affiliate network and begin promoting products assigned for a commission. It is simple, just like joining Facebook or opening a new email account. Most of the times, the affiliate networks or merchant sites do not charge a thing to join. Only what you need to have is your email, personal details, information about your website, the content of your website, the traffic, and the niche or the industry that you have specialized in. At times, you can be that blogger who tackles different niches or topics on your blog. No worries, you still can join. However, it is advisable to select one niche, which will help you become a pro or a professional in that niche. An authority niche receives high ranking as Google interprets that you are an authority in this niche.

How can I get Started with Affiliate Marketing in Kenya, Yet I am a Newbie?

If you are new and intend to start affiliate marketing, then worry not. All you need is to do some research on the most favorable industry you can blog about. An industry that you have knowledge or experience writing about is advisable as this will be easy to write about forever without getting bored. Find out whether many people have written about it or are talking about it. This will help you know how competitive it is to venture into that industry. If it is not competitive, you need to buy a domain, for example, on NameCheap, which is really cheap, about Ksh1000 or USD10 per year and you can pay for hosting for example with Site Ground, which charges about $50 per year or even locally, for example with Kenya Web Experts, who have packages that start from Ksh2100 per year, and build your website with Word Press, and off you go. Start blogging now. However, before you blog, the secret to rank highly is doing what we call keyword research to find keywords that are not competitive. You can use the Google Keyword Toolkit to help you find less competitive keywords to use in your articles.


Overall, affiliate marketing pays well, especially now when you need money the most. If you learn a little bit of search engine optimization, which is a technique for ranking your website on search engines, then you will be better placed in making passive income. You can later turn niche marketing into your full-time carrier and live entirely on the internet, as we always put it.

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Business Ecommerce Marketing Finance Economy Technology Management COVID-19

  • 1 year 1 month ago

Irrational rejection of ''Modern Monetary Theory''.

Hanns-Jürgen Hodann
Modern Monetary theory (MMT) has shown how modern monetary systems actually work. It has shown  that governments that issue their own currency, such as the US, can never run out of money or be forced to default on debt issued in their own currency. It has also demonstrated that government spending to stimulate the economy is logical and that the resulting deficit is irrelevant - the government always has the monetary means to eliminate it. This directly contradicts neoliberal doctrine that wants to limit government spending and posits that deficits destabilize the economy. Neoliberalism often constitutes a 'worldview' and 'personal identity'. Those who hold such strong beliefs cannot be persuaded to abandon them using rational arguments and facts - psychological reasons usually impede it as research has shown. The worldwide dominance of the doctrine, vested interests and psychologically grounded opposition suffocate MMT and rational arguments showing its superiority are seemingly of no avail. 

Economy MMT Neoliberalism Finance

  • 4 years 2 weeks ago

Model of Covid-19 Outbreak in Burnie, Tasmania (Yue Xiang 512994)

Yue Xiang
Simple epidemiological model for Burnie, TasmaniaSIR: Susceptible to infection - Infected - Recovery, Government responses and Economic impacts  

Government policy is activated when there are 10 or fewer reported cases of COVID-19. The more people tested, the fewer people became infected. So the government's policy is to reduce infections by increasing the number of people tested and starting early. At the same time, it has slowed the economic growth (which, according to the model,  will stop for next 52 weeks).

COVID-19 Coronavirus SIR Model Government Economy Burnie Tasmania UTAS BMA708

  • 8 months 3 hours ago


Hanns-Jürgen Hodann

Wealth can be seen as the factories, infrastructure, goods and services the population of a nation dispose of. According to Tim Garrett,  a scientist who looks at the economy from the perspective of physics, it is existing wealth that generates economic activity and growth. This growth demands the use of energy as no activity can take place without its use. He also points out that the use of this energy unavoidably  leads to concentrations of CO2 in the atmosphere.  All this, Tim Garrett says,  follows from the second law of thermodynamics.  If wealth decreases then so does economic activity and growth. The CLD tries to illustrate how wealth, ironically, now generates the conditions and feedback loops  that  may cause it to decline. The consequences are  inevitably economic  stagnation (or secular recession?). 

You can read about the connection Tim Garrett makes between 'Wealth, Economic Growth, Energy and CO2  Emissions' simply by Googling 'Tim Garrett and Economy'.

Economy Global Warming Resource Depletion

  • 4 years 2 months ago

Model of COVID-19 outbreak in Burnie(Yafei Shi 489576)

Yafei Shi
This is a system dynamics model of COVID-19 outbreak in Burnie which shows the process of infections and how  government responses, impact on the local economy.  
First part is outbreak model, we can know that when people is infected, there are two situations. One is that he recovers from  treatment, but even if he recovered, the immunity loss rate increase, makes him to become infected again. The other situation is death. In this outbreak, the government's health policies (ban on non-essential trips, closure of non-essential retailers, limits on public gatherings and quarantine )  help to reduce the spread of the COVID-19 new cases. Moreover,  government legislation is dependent on  number of COVID-19 cases and testing rates. 
 Second part: the model of Govt legislation and economic impact. Gov policy can help to reduce infection rate and local economy at same way. The increase of number of COVID-19 cases has a negative impact on local Tourism industry and economic growth rate. On the other hand, Govt legislation also can be change when reported COVID-19 case are less or equal to 10.

COVID-19 Burnie Tasmania BMA708 Economy

  • 8 months 4 hours ago

Fallacy of Spending Cuts

Hanns-Jürgen Hodann
The upper diagram shows the principal factors that have an influence on the budget deficit and indicates what needs to be done to correct it. But this is not the full story. The diagram below shows that  cutting public expenditure reduces aggregate demand and  increases unemployment. The reduction of aggregate demand  reduces  economic activity which has the effect of reducing  tax revenue.  In addition, the state has to pay out funds as there is a need for more unemployment benefit payments.   The result of these austerity measures  is often the opposite of their intended purpose: they can increase rather than decrease the budget deficit.

There is plenty of empiric evidence to show that this has happened time and time again. For instance, a report from UNCTAD (United Nations Conference on Trade and Development) found that between 1990 and 2000 in all the  cases examined where cutbacks in public spending and tax increases were used, the fiscal situation did not only not improve but worsened. Despite such repeated evidence, unfortunately calls for  austerity measures continue to be heard. 

Economy Economics

  • 7 years 5 days ago