David R. Henderson  

Bryan Caplan is Not Like Warren Buffett

PRINT
The Magic of Education... Markets for Everything: Managi...

In his critique of education--I have been urging Bryan to call it schooling, but have had no apparent effect on his wording--Bryan Caplan lays out how government pays him to school people and how what he teaches them has little effect on their ability to perform jobs other than academic ones.

Bryan ends as follows:

My conscience, however, urges me to blow the whistle on the system anyway. Education is not magic. Professors can't make students better at whatever job awaits them with learned lectures on arcane topics. I'm glad I have a dream job for life. I worked hard for it. But society would be better off if taxpayers saved their money, students spent fewer years in school, and sheltered academics like me finally entered the Real World and found a real job.

A perceptive reader, Joe, wrote:
Bryan: "It would be better for society if I were fired, but until then I'm gonna keep my dream job."
Commenters: "Hear, Hear"

Warren Buffett: "It would be better for society if I were taxed more, but until then I'm gonna keep my money."
Commenters: "You should just pay more yourself."


I thought someone might step in and defend Bryan from the comparison to Buffett, but so far, no one has.

So I will. The difference is this. If Buffett were to give more money to the U.S. government, the government would have more money. Joe's analogue seems to be that Bryan should quit his job. But if Bryan were to quit his job, I can virtually guarantee that someone else would replace him. Quitting would not save the taxpayers any money. Government spending would fall by zero.


Comments and Sharing





COMMENTS (18 to date)
david writes:

If someone else replaced Caplan, then it would not be better for society if he were fired (assuming Caplan's signalling argument, etc.). For there to be an aggregate improvement, obviously the context is that Caplan is fired and the dream job is eliminated.

David R. Henderson writes:

@david,
Precisely.

I don't think Bryan should quit his job, but if he did he would probably be succeeded by someone more junior and therefore cheaper, saving a little money on the margin.

andy writes:

I understood Bryan's point differently: it's more like it worked for him, but for 99% of people it's waste of time. So there's no point in Bryan leaving the school, it's more like the 99% of people should find a way to do without the school, because it doesn't benefit them; and that works even ex-ante, most people don't study chool in order to become proffessors.

BTW: public choice in credentialism-plagued EU - the state is ramping up requirements who should have at least Bc (e.g. kindergarten teachers). What happens? Well, they ultimately get their degree. How? Well, we just got one scandal regarding paid degrees....and some people teaching at universities told me it's getting more a rule than exception.....

The best way to ruin your education system is requiring a degree for people who absolutely don't need the education.

Jehu writes:

I don't see Bryan framing the issue as a moral imperative, rather mostly one of efficiency. Accordingly I'm inclined to cut him a lot more slack than Buffett.
It's akin to saying that society really ought not to leave tons of money all over the ground on Wall Street after helicopter Ben makes a pass while collecting said cash with janitorial equipment as your day job.

Gene writes:

The crack dealer at my kindergarten completely agrees.

PrometheeFeu writes:

Actually if Bryan quits his job, the supply for professors will go down. That will drive prices up.

Bob Murphy writes:

There should be an animated series, "Man at Work," that chronicles the alternative-universe saga in which Bryan Caplan is a garbage man. Caplan stumps his fellow garbage men at lunch with such zingers as:

"Why do all these people recycle? Is it some weird 'duty' to Mother Earth? What if the government said it would chop people's hands off if they didn't recycle? How much would that increase our equilibrium earnings from bribes?"

UnlearningEcon writes:

Well they are both silly premises. Even Buffet's money would be a rounding error, whereas he is calling for systemic change.

Ted Levy writes:

I'm not sure I agree, David. Why do you say if Buffet paid more in taxes the government would have more money? Don't we typically argue that no matter how much is collected in taxes the political incentives are to spend all of it and more? So why in this case would the government end up with more money?

joeftansey writes:

Unless there are a bunch of unemployed econ PhDs waiting on the sidelines, Bryan's job would go unfilled for a while. So Bryan could reduce the amount of "education" supplied in the short run.

But if his job allows him to do research and write books that helps reverse the whole system, I think its probably worth it.

David R. Henderson writes:

@Ted Levy,
I said that the government would have more money, not that it would end up with more money.
@joeftansey,
Good point. But he would have to stop writing about having more kids and write the book, well, the book that he actually is writing. :-)

Keith writes:

David,

Perhaps Bryan could find a job with greater social value. At least, that's how I understand the excerpt of Joe's comment--as dealing with total social value, not with government funds.

Ari T writes:

What is this with commenters engaging in personalities. I saw this kind of an argument on Marginal Revolution recently, that is, redistributionists should maybe do more charity. I saw a good response on Finnish blog by Tiedemies, so I'll translate it here.

Say f(x) is the function of society's state after some policy, g(x) = c(x) + p(x) is the function of goodness of its state, h(x) is the function of state of the society that is chosen regardless of our choice, c(x) is the collective benefit and p(x) is the personal benefit.

If we know that c(h(f(x))) = c(f(x)) at good accuracy, there's no need to calculate a value for c(h(f(x)) since we know that maximizing p(h(f(x))) maximizes g(h(f(x))). Thus it makes sense to support such policy that maximizes h(x), that would result in different optimal result for personal benefit, and maximize personal utility.

Besides, the marginal benefit of eg. helping poor with $1000 every month is much less than losing $1000 a month.

Thus it makes sense not to give to charity and to support redistribution or work at government but not support it. Trying to moralize these people is very likely unjustified.

liberty writes:

"Bryan: "It would be better for society if I were fired, but until then I'm gonna keep my dream job."
Commenters: "Hear, Hear" "

The irony I see here is that there are commenters agreeing that it would be better for society if Bryan quit. If he has commenters (read: customers) then isn't it good for society that he keeps his job? Customers include commenters, students, readers of his books, etc. So long as he has happy customers why should I believe that it would be better for society if he quit? I understand education is subsidized, but if people enjoy his work enough to buy his (unsubsidized) books, it seems he is creating real value.

Otherwise I would agree with the comparison - if you really think it's bad for society, then the moral imperative would be to quit - just as Buffet should give away his money without being forced to. To say "someone else would fill my shoes" is equivalent to saying "If I didn't mug the old lady someone else would - it's a bad neighborhood, she shouldn't be out at night", etc.

Joe writes:

@Keith

You are indeed correct. I was talking about social value, government funds only come in to play in Buffett's case.

Steve Roth writes:

If I propose that we do a potluck but we don't agree to do so, my showing up with a dish will not result in a potluck happening.

It's called collective action, it requires ex-post agreement (and enforcement) to prevent free-riders, and as Tyler Cowen points out (using far too many words), it's a concept that most bright kids grasp in their teens.

Sorry to self-link, but the longer (though rather obvious) explanation and links are here:

http://www.asymptosis.com/why-doesnt-warren-buffett-give-all-his-money-to-the-government.html

Mike Williams writes:

I think we may be missing an important point; why can't professors make students better? What is stopping Bryan from evaluating what he teaches and then modifying it to create value for students? Has he asked his previous students if he contributed any value to their future jobs? I think we may, sometimes, take short sighted view of what does and does not prepare students for future jobs. I know from you, David, I learned a valuable lesson in incentives (that surprisingly, or not, is extremely applicable in the US Army Acquisition Corps) and second and third order effects, etc. So instead of throwing in the towel on making students better at what ever job awaits them maybe one should look at what they teach, ask students (past and present) what has helped them and then EDUCATE them instead of schooling them. Just my two cents.

Comments for this entry have been closed
Return to top