Who cares?. As Bryan points out, this sort of study confounds ability with learning, which makes it uninteresting. What would be more compelling would be a finding that students whose CLA scores rose the most during college had the best employment experience. That would come closer to saying that the students learned something, and that what they learned affected employment outcomes.
What adds to the frustration is that the authors had the data. That is, they had the data on growth in CLA. However, they stuffed it into another variable:
Academic engagement/growth is a summary measure including taking courses with reading and writing requirements, hours studying and demonstrated growth on the CLA.
I should add that, in general, creating an index out of variables instead of entering the variables separately is bad practice. You are starting from a situation in which the dependent variable, Y, might be determined by X and Z (assuming linearity) as
Y = aX + bZ
where a and b are unknown coefficients. When you create a "summary measure" that combines X and Z, you are imposing a ratio a/b that is based not on the data but instead on your arbitrary assumptions. Unless you have some strong theoretical or empirical reason to impose a specific ratio (which is very unlikely to be the case here), doing so produces statistically biased results.
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too elementary for most MR readers but it is well executed and would make a good gift for anyone needing an introduction to economic reasoning.
1. The price is very attractive. I saw it on Amazon in paperback for under $11.
2. I have a specific purpose in mind for the book. I want something that students who sign up for my AP economics class can read over the summer to give them background in economics terminology. I believe that it suits this purpose, although I will recommend only selected chapters. That was not the purpose for which the book was designed, but considering point (1) I think it will do.
3. I think that Timothy Taylor's comparative advantage is blogging. That is, I am more impressed by his blog than by the book. I mean that as praise for his blog, not criticism of the book.
4. Taylor is a hard-core two-handed economist. He makes the case for government intervention and the case for skepticism about government intervention. His case against government rests on the principal-agent problem. That is, government as agent may not serve the public as principal. Thus, he brings in Public Choice.
5. However, to my taste, he does not make the case for skepticism as well as he might. In his earlier chapter on markets, he invokes "I, pencil" and the ability of markets to process information. In the chapters on government, he does not circle back and talk about the knowledge problem or the socialist calculation problem.
6. More importantly, Taylor does not stress two factors that are important in shaping my skepticism. One factor is the sheer power of exit as compared to voice. The other factor is dynamic learning. Markets, by rewarding success and punishing failure, are relatively effective learning mechanisms. Government, with its much weaker accountability, is a relatively ineffective learning mechanism.
7. Finally, if I were writing this sort of book, I would make very clear the failure of the "intention heuristic" in describing government. When proponents of government intervention make their case, it is nearly always in terms of intent. "X is bad, Y would be better, and we need government intervention to get Y." The fact that government intervention often yields Z, and Z is worse than X, is forever being overlooked.
8. Taylor's attempt to explain mainstream macroeconomics is sincere and competent. However, as you know, I have come to view mainstream macro as a crock. Still, I would include several of the macro chapters in my summer reading assignment, because the AP macro exam is based on this crock.
]]>How would your career have been different if you had failed all the classes you've totally forgotten?According to the human capital model, failing (i.e., never knowing) course material should have exactly the same career consequences as forgetting (i.e., no longer knowing) course material. Either way, you lack the skills - and the labor market should treat you accordingly.
As it happened I was also debating Bryan Caplan, who I thought and still think, would admit that one's actual level of conscientiousness is probably genetically determined. And, further that this personality attribute underlies most of what the normal world would call "laziness."Actually, I've explicitly disavowed genetic determinism for any interesting behavioral trait. So does every behavioral geneticist. The proof is simple: if genetic determinism were true for any trait X, identical twins would have exactly the same value of X. They almost never do. Conscientiousness is a case in point; heritability estimates are typically 40-60%. None approaches 100%.
[I]f one is sympathetic towards those born blind does it not follow that one should be sympathetic towards those born lazy?
Now, that having been said I recognize that there will be a huge visceral aversion to this line of reasoning. And, so I want to do what I can to calm that aversion.
My point was that the reason we feel so differently about disabilities like blindness as opposed to disabilities like laziness, is that its really difficult to fake being blind. Thus there is much less concern that the blind person is taking advantage of you by lying about their blindness.
Its much more difficult to confirm laziness. So much so that people are hesitant to think of it as not a innate property of the person at all. However, our psychological research strongly suggests that this is not true.
But laziness is totally different from blindness: laziness is a choice, and blindness isn't. Karl ably explained my reasoning during the debate: Laziness, unlike blindness, responds to sufficiently extreme incentives, and something can only respond to incentives if you are able to do otherwise.
Consequentialists naturally tend to misinterpret this statement as saying, "We should punish laziness in order to reduce laziness." But my point is about philosophy of mind, not policy. The responsiveness of laziness to incentives shows that being lazy is a choice.
Of course, you could just bite the bullet and insist that what appear to be choices are never "really" choices. But that goes against all mental experience, and should be dismissed as absurd.
One last point: Many people (Scott Sumner among them, I fear) would be tempted to complain that I stubbornly cling to whatever moral intuitions I deem to be "obvious," while Karl actually tries to prove his moral conclusions. My reply: Karl rests all of his moral conclusions on a single utilitarian premise. And what is that premise? If you say, "Just another intuition," you're being generous. The utilitarian intuition is a paper tiger, subject to a long-standing list of devastating counter-examples. Utilitarians' standard replies are to (a) change the subject by denying the empirical importance of the counter-examples, and (b) dogmatically accept every absurd implication of their view while criticizing the "dogmatism" of everyone who demurs. If this isn't ridiculous enough, utilitarians proceed to continuously violate their own ethic by failing to spend all their spare resources on desperate strangers.
I'm not saying that human happiness isn't morally important. I'm saying that human happiness is one morally important thing on a long list of morally important things: desert, justice, honesty, achievement, truth, beauty, and liberty are merely the beginning. The only way to weigh them against each other is with clarifying examples and reflection. Morality would be a lot simpler if utilitarianism were true. But it's better to be broadly right than simply wrong.
]]>The format consisted of 4-minute opening statements followed by one-minute responses to questions. It makes for lively entertainment, but not so much for serious discussion. Welch and Goldberg mostly played it mostly for laughs, which is all that the silly format really allowed.
1. Welch was optimistic that Republicans were willing to compromise with libertarians (he cited Jim DeMint's recent outreach efforts, not all of which are on the record.)
2. Both assumed that Mitt Romney will be the Republican nominee, thereby ducking the question of how libertarians might respond to a Santorum candidacy. Is there daylight between Santorum's brand of conservatism and W's? I would like to have gotten an informed answer, but no one asked the question.
3. Welch said that the demographics of Republican primary voters and caucus-goers is skewing very old. I am wondering if 2012 will be the swan song for voters born before 1960. I still think that the future of the Republican Party looks very dim. The last time a Republican establishment candidate suffered a meltdown during the nomination campaign, it did not turn out well for the GOP.
4. Welch and Goldberg took the view that the cascading U.S. debt will drive libertarians and conservatives into one another's arms, just as the Cold War battle with Communism did. I wonder how they would react to the conversation with Garett Jones, who believes that the debt problem will only be solved by a Democratic victory.
5. Both agreed that immigration is an issue where some libertarians (e.g., Ron Paul) and many conservatives take a stance that is more hostile to immigration than is morally or politically wise overall. But I would say they are overlooking the stridency of the Republican base on the issue. They make it sound as though it is an accident that the Republican candidates are not playing up the benefits of immigration. But I would say that this is where the influence of the Tea Party is decidedly not libertarian.
6. Welch tried to say that the Occupy movement has a healthy opposition to bailouts, but Goldberg was having none of it. His line was that the Occupiers are not opposed to bailouts; they just want to get their own bailouts, rather than have the money go to Wall Street. I tend to agree with Goldberg--I think you are kidding yourself as a libertarian if you think that shared opposition to bailing out Wall Street is the basis for some sort of alliance.
7. Goldberg made at least two other points that I appreciated. The first one is that "the libertarian in the room asks the right question: Why is this a job for government?" Without the libertarian in the room, I would say that the question does not get asked.* The second one is that politicians always are a disappointment to their supporters. If nothing else, the pressure to win votes limits their ability to stick to principles.
*What I would say (Goldberg put it differently) is that without the libertarian in the room to question the role of government, the conversation proceeds more along the lines of the joke, "Something must be done. This is something. Therefore, it must be done."
[update: Glenn Reynolds has two related links.]
]]>It is a good discussion, but quite depressing. A naive view of federalism is that it encourages robust competition at the state and local level. Unfortunately, the reality is that competition gets suppressed, and the incentives are rigged in favor of government expansion.
]]>Reihan has some post-interview thoughts, including:
At the very least, colleges and universities should be required to release data on whether or not students demonstrate a significant improvement in learning between enrollment and graduation -- and if they don't, they should be barred from receiving federal student loan money.
[UPDATE: podcast version.]
]]>For Frum, the "hurricane" is stagnant or falling wages for half or more of the population:To understand what Murray does in Coming Apart, imagine this analogy:
A social scientist visits a Gulf Coast town. He notices that the houses near the water have all been smashed and shattered. The former occupants now live in tents and FEMA trailers. The social scientist writes a report:
When he publishes his report, somebody points out: "You know, there was a hurricane here last week." The social scientist shrugs off the criticism with the reply, "I'm writing about housing, not weather."The evidence strongly shows that living in houses is better for children and families than living in tents and trailers. The people on the waterfront are irresponsibly subjecting their children to unacceptable conditions.
Across the developed world, we see the wages of the bottom half (and in some cases more than half) have stagnated, even as gains have accrued to the top 20%, bigger gains to the top 5%, and the biggest gains to the top 1%.But Frum's story makes little sense. Divorce, out-of-wedlock births, and low labor force participation are expensive. If you're worried about being poor, you'll studiously avoid them. So how could economic distress be their "root cause"? To rewrite Frum's hurricane analogy:
My point: The hurricane should have made people more careful with their food. Yes, they experienced a natural disaster. But instead of prudently adjusting their behavior, they're being bizarrely short-sighted and irresponsible. And it makes you wonder: If this is how they act after a hurricane, would their behavior would have been even worse if the hurricane had never hit?A social scientist visits a Gulf Coast town. He notices that the houses near the water have all been smashed and shattered. The former occupants now live in tents and FEMA trailers. They're also malnourished because they keep leaving their food on the beach, where the evening tide quickly carries it out to sea. The social scientist writes a report:
When he publishes his report, somebody points out: "You know, those hungry people could keep their food in their tents at night." The social scientist shrugs off the criticism with the reply, "I'm writing about malnutrition, not food storage."The evidence strongly shows that the hurricane is causing severe malnutrition. Back when these people had houses they kept their food inside. The government is turning its back on the indirect effects of natural disaster.
Whether politicians ignore the poor and pander to the middle class or scare the middle class into thinking they are as bad off as the poor, the result is likely to be the same. Most of our policies will continue to be mis-targeted, as analyses by the Pew Economic Mobility Project and CFED have demonstrated. In turn, they will explode the deficit, leaving less money to promote upward mobility among the poor. And those policies that take the form of tax breaks for investing in savings or education will further price the poor out of markets for mobility-promoting assets--whether higher education or homes--by subsidizing investment the non-poor would have made even without tax incentives. Think "mortgage interest deduction".
Timothy Taylor has more on the politics of tax reform. We could make our tax system more progressive and more efficient at raising revenue. But it is always in the interest of political entrepreneurs to claim that the affluent are threatened as it is, so we cannot take away their precious mortgage interest deduction or make the tax breaks for education expenses and health insurance less regressive.
]]>First, note their use of the word "forced." That panic didn't force the federal government to do anything. The feds chose to intervene. But by using the word "forced," the reporters make it sound as if the regulators are trying to avoid ever being "forced" into something again.
Second, the panic arose because, in 2008, the money market funds were trying to hold on to a $1 per share value and it looked as if they might not be able to. So many people, including me, quickly took their founds out at the $1 per share value to avoid a small haircut. But shares in money market funds are not, repeat, are not like checking accounts or savings accounts. The people who own the funds have no legal obligation to give $1 when you redeem. If earnings fall enough, they might be able to afford only 99 cents or 98 cents or 97 cents. This is called "breaking the buck."
Had the feds not intervened by shoring up the money-market funds, some of the money-market funds would probably have had to cut to a number like 98 or 97 cents. That would have stopped most of the panicked withdrawals. And many people would have learned, or been reminded of, the difference between a checking account and a money-market fund.
Instead, the SEC proposes to stick with moral hazard and add the further regulation that government-caused moral hazard often leads to.
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We can't seriously think that people are narrowly and permanently self-interested, because the costs of enforcing agreements and constantly guarding against fraud or theft would be overwhelming.
We might grant the alternative simple view as describing the intentions of most political actors. Still, representative democracy may do a poor job of arriving at good results, because intentions do not necessarily map well to consequences.
Suppose we are looking at Energy Secretary Steven Chu's granting of government-guaranteed loans to energy companies. As Robert Murphy explains, such loans are bad economic policy even if there are no defaults, and even if there was no political favoritism involved.
When political actors are motivated by the public interest to allocate resources, we should not jump for joy. Instead, we should shout in protest.
]]>Robin has spent decades proposing unconventional policy deals. His track record is an abysmal failure.None of this means, however, that Robin himself is an abysmal failure. I don't judge a scholar by the deals he manages to push through. I judge him by his discovery of important truths. By this standard, Robin is a great success. His work on betting markets, health economics, and futarchy leaves me in awe. Even his errors are fruitful. The fact that policymakers consistently ignore Robin is their abysmal failure, not his.