Manhattan Reborn 1978

Houston, Texas.

It's approaching evening~

West of downtown, 19 Piney Point Village, Piney Point Village, Memorial District.

David stood at the door and saw off Mr. Longhorn. When he returned to the study, he saw his mentor, Professor Bartley, and smiled.

"I am back."

"Um.."

Professor Bartlet put down the manuscripts in his hands, glanced at the remaining pages on the table, and asked.

"How does the house look?"

"not bad."

“I went to see two houses nearby that were on the market and decided to buy them both!”

"Buy them all?"

"Correct!"

David waved to Toby, asking her to go out and rest for a while, and explained with a smile.

"The two houses are located at 86 and 89 Pinewood Avenue. They happen to be at the same intersection."

"No. 86 Pine Forest Avenue is a bungalow with only one floor + basement + oversized backyard and utility room. The indoor area is about 400 square meters. The interior decoration and furniture are all new. You can move in directly."

"No. 89 Pine Forest Avenue is a double-storey house with a basement, a slightly smaller backyard and an attic. The single-storey area is about 160 square meters. The interior decoration is very old. The floors, stairs and some furniture need to be replaced and repainted. Check in only once.”

"Hmm..." Professor Bartlet looked at the excited David and asked again feeling a little strange.

"Didn't we just say at noon that we will go back to New York together in a few days?"

"You want to buy them just for temporary residence?"

"Of course not~"

David moved closer to his mentor, clasped his fingers and continued to explain.

"You also saw my dad's leg..."

"He didn't know how to take good care of himself when he was young. In recent years, whenever the weather turns cold, some old problems with his leg will relapse."

"My mother and I accompanied him to the hospital for a check-up. The doctor said that this was a sequelae left after the bones re-healed. Apart from taking some oral medicine to relieve Rheumatoid Arthritis (RA), there was no good way. .”

"ra?"

"Correct!"

David shook his head with regret and said, "The doctor from New York-Presbyterian Hospital told us~"

"In 1966, the American College of Rheumatology classified rheumatoid arthritis (ra) and ankylosing spondylitis (AS) into two independent diseases."

"Before this, they were named peripheral rheumatoid arthritis and axial rheumatoid arthritis."

"Today I asked Elena to go to Houston Methodist Hospital to visit a professor who has extensive experience in diagnosing and treating RA. I hope he can help my dad diagnose the disease and formulate an effective treatment plan."

"If he can treat my dad's condition or relieve his pain, I'm willing to give it a try!"

"Yeah..." Professor Bartlet smiled and nodded after listening.

He was just worried that David would spend money frivolously, and wanted to ask and persuade him~

I didn’t expect this child to be sick for his father. .

"You went out just now, and I found this when I was looking through the manuscript...?"

"What is it?"

Professor Bartley picked up the "new discovery" just now from the table and asked David.

When David saw the chart picked up by his tutor, he blinked and smiled: "I expanded this based on the formula of Robozinski's theorem and some real economic data collected..."

"Tadeusz Robozinski?" Professor Bartlet frowned and said an almost forgotten name.

"Yes, that's him!" David gave a thumbs up to his mentor.

"His name is so hard to remember, I can't even remember it..."

"Tadeusz Rybczynski proposed Rybczynski Theorem (Rybczynski Theorem, referred to as r theorem) in "Factor Endowments and Relative Commodity Prices"."

"Robozinski's theorem means that under the premise that the relative price of commodities remains unchanged, an increase in a certain factor will lead to an increase in production in the sector that intensively uses that factor, while the production in another sector will decrease."

David found a pen and white paper from the table and explained while drawing.

"The practical significance of Robozinski's theorem is that for countries with a relatively increasing capital stock, it can be expected that the scale of their labor-intensive industries will tend to shrink; for developing countries with a tendency to increase the supply of labor factors, capital-intensive development will not be appropriate in a timely manner. In large-scale industries, it may lead to the loss of comparative interests, etc."

"Because the comparative interests of a country are not static~"

“An increase in the factors of production that produce importable goods will reduce the demand for imported goods, thereby improving their terms of trade.”

“The increase in production factors required to produce export goods will increase the supply of export goods, leading to a deterioration in their terms of trade.”

"This is particularly important for export-oriented companies or countries."

"So while increasing exports, they must pay more attention to the possible negative impact on trade conditions and seek advantages while avoiding disadvantages."

David pushed the picture he drew aside, found his notebook on the table, and said.

"Almost since last year, I have occasionally seen reports on TV news and newspapers about the economic difficulties in the Netherlands."

"The Netherlands is a very typical small country in Europe. Most of its territory is plain terrain. About a quarter of the land is lower than sea level. The natural conditions for agricultural production are not good."

"In 1959, Europe's largest natural gas field was discovered near the northern Dutch city of Groningen, with estimated total reserves of more than 7000 billion cubic meters."

"The Dutch government began to vigorously develop natural gas fields in the 60s, resulting in a sharp increase in exports, a surplus in the balance of payments, and a prosperous economy."

"However, although the booming natural gas industry has made the Dutch government more profitable, it has also severely hit the Dutch agriculture and other industrial sectors, weakening the international competitiveness of the export industry."

David quickly wrote a sentence on the chart in front of Professor Bartley with a pen: "The r-theorem tells me that for countries with a relative increase in capital stock, we can expect that the scale of their labor-intensive industries will tend to shrink. "

“Capital stock is all the existing capital resources of an enterprise or country.”

“Capital resources refer to the sum of various material resources including natural resources, such as land, rivers, mountains, tidal flats, mineral deposits, factories, machinery and equipment, infrastructure and raw materials, etc.”

"So while the Dutch government continues to develop natural gas resources and earn foreign exchange through exports, its total domestic agricultural exports and industrial product exports have shown a downward trend year by year~"

"But this trend, which has lasted for about ten years, seems to have failed to attract the attention and attention of the Dutch government~"

"It wasn't until 71 that the dollar was decoupled from gold, and the Dutch guilder implemented a floating exchange rate that appreciated significantly. Its domestic high-welfare + high-income policy allowed ordinary people to truly experience what it means to be inhumane."

"However, the appreciation of the Dutch guilder has also seriously affected the domestic export-oriented industry, which has become weaker and weaker. The labor costs of organizing production have continued to increase, and export revenue has continued to decrease. In the end, we have no choice but to implement batch layoff plans. Reduce the company’s labor costs..."

"The oil crisis that broke out in 73 was nothing more than adding fuel to the fire for the Netherlands' rapidly weakening economic situation..."

"The oil crisis caused the most severe inflation in the history of the Netherlands. The total export trade volume hit new lows, the total import trade volume hit new highs, and the unemployment rate also hit a historical low since records began after World War II."

David wrote a few lines of words on another piece of white paper and said to the mentor who looked thoughtful.

"I tried to divide the Dutch economy into three sectors, namely: the tradable manufacturing sector, the tradable resource export sector and the non-tradable sector."

"The non-tradable sectors are mainly sectors such as construction, retail trade and services."

"Assuming that the Dutch economy is initially at full employment, if a certain natural resource (natural gas) is suddenly discovered or the price of natural resources rises unexpectedly, it will lead to two consequences~"

"First, as labor and capital shift to the resource export sector, the tradable manufacturing sector now has to spend more to attract labor. The rising labor costs in the manufacturing industry first hit the competitiveness of the manufacturing industry."

"At the same time, the increase in foreign exchange earnings from exporting natural resources (natural gas) has led to the appreciation of the local currency, which has once again hit the export competitiveness of the manufacturing industry."

"I call it the resource transfer effect, that is, under the influence of the resource transfer effect, the manufacturing and service industries decline at the same time."

"Secondly, rising revenues from natural resource exports will also continue to increase demand for products from manufacturing and non-tradable sectors."

"But at this time, the increased demand for manufacturing products was met by importing similar and cheaper manufactured products from abroad."

"This is another huge disaster for the Dutch manufacturing industry."

"However, increased demand for products from non-tradable sectors cannot be met through imports."

"We will find that the tourism and service industries in the Netherlands have become prosperous again in recent years."

"This is a very research-based situation. I call it the spending effect."

"The expenditure effect means that when the cost of a certain product is larger or accounts for a larger proportion of household income, consumers are more price sensitive."

“The higher the price of an item, the more benefits customers can gain from careful selection.”

"This is why consumers tend to spend more time and energy comparing and selecting expensive products."

"As for some lower-priced daily necessities, they are less willing to spend more time and energy selecting them."

"For example, my mother struggled for a long time about whether to buy a color TV produced in the island country."

"When my dad goes to the town stores to buy low-price daily necessities, most of them don't carefully select and compare..."

"Haha~" Professor Bartley shrugged with a smile, looked at David and sighed.

"Are you going to put this chart into the book?"

"No!"

David shook his head and laughed: "I have no intention of putting it in the book."

"This resource industry's price inflation during boom times is an economic phenomenon at the expense of other industries."

"It may also appear again when foreign exchange investments want to flow out in large quantities!"

"So it will be a common disease that many countries may suffer from."

"I call it, Dutch disease."

"...Dutch disease?"

"Hahaha~" Professor Bartley was amused by David's "bad taste" attitude in casual naming~

While David was laughing with his instructor, he was also secretly relieved~

What should come, always will come!

It would be better to wait for it to come in fear every day. .Take the initiative!

(ps: I’m too sleepy today, so I’ll keep it short. Sorry!)