by Tyler Cowen
on August 28, 2013 at 11:37 am
in Uncategorized |
1. The very real returns to education.
2. The signs for the new Swiss drive-in brothels.
3. Do military interventions reduce the killing of civilians in civil wars?
4. Where middle class jobs are vanishing the most rapidly.
5. Profile of Tim Harford.
6. Why hold cows and buffaloes?
1. That’s the wrong comparison.
People re-ask “is college worth it” every fall, never diving into flow charts or road maps for various subgroups. They’d have us think the answer is “yes,” and that’s it.
#1 and #4 make nice bookends. On the one hand, college is worth. On the other, college grads are being squeezed out of the workforce.
Not my interpretation of #4. It looks like the job squeeze is tightest in those middle-income fields where a degree is not required, while the Sci-Fi (computing, engineering, finance) fields where a degree is all but mandatory are the big growth sectors, and high-income too.
OTOH, the social sciences still look like a sucker’s field.
Huh? Because people go to college to get a manufacturing job?
#1 and #4 do make an interesting pair, although I’m not sure that the authors see it. Suppose one believes #1, which implies that middle class kids improve their incomes when they go to college. Then, in #4, we see the effect of sending large numbers of middle class kids to college: more of these kids end up in high-wage jobs instead of middle-wage jobs. One would think that high-wage job growth would be a good thing, certainly preferable to middle-wage or low-wage job growth.
One gets the impression, though, that the author of #4 and various commentators don’t think so. There seems to be some school of thought, call it the inequality school, that weaves #1 and #4 into a narrative something more like the following: “Going to college unequivocally makes one more likely to become wealthy. Thus, to alleviate inequality, we need to subsidize education of the (future) wealthy. However, we must be careful not to create too many high-wage jobs, especially at the expense of middle-wage manufacturing jobs, because that would also exacerbate inequality. Thus, we need to limit high-wage job growth (management, finance, etc.) and push these college graduates into the same middle-wage manufacturing jobs that they would have had had we not subsidized their college educations.” There is something about this line of thought that does not quite make sense to me.
The author claims to make a slam-dunk case that college raises incomes, but he draws a strange conclusion in his last sentence: “That’s why keeping [college's] price low and enrollment accessible is so vitally important.”
Actually, if college is such a great investment, then we don’t need to worry about helping students pay for it: the financial returns should more than offset the costs. We would only need to ensure financing and, again if the returns are so good, then there will be plenty of private financing from investors, attracted by the prospect of sharing in those returns. It’s like saying, “Wall Street jobs are incredibly lucrative. That’s why we need to subsidize investment bankers’ housing so that they will be able to afford taking those jobs.”
The case for public financial aid for college actually depends on establishing that the private returns to education are *not* sufficient to justify the costs, at least not for some students, but that there are sufficient positive externalities from education such that the public has an interest in seeing those students go to college, even if it’s *not* in those students own best interests.
(from a certain policy perspective, that is)
Why not use the actual title for #6, “Continued Existence of Cows Disproves Central Tenets of Capitalism?” ?
What? Is David Graeber now writing about about cows now?
Gift economy: You give David Graeber a cow. He gives you a book explaining why you should give him another cow.
The researchers have no beef with capitalism.
The authors give a number of explanations in Sec. IV of their paper about why owning cows and buffaloes might make sense. A better title for their paper might have been: “When Does ‘Local Food’ Make More Sense than ‘Big Food’?”
I believe they are referencing a great Onion title, which went something like: “Continued Existence of Edible Arrangements Disproves Central Tenets of Capitalism”
#1: At some point in the future alien anthropologists will dig through the rubble of earth and conclude what killed us off was our inability to understand the difference between correlation and causation. The assumption that college graduates would be sleeping under a bridge is ridiculous. But, the emotional investment in the myth of modern education is too much for most to overcome.
Objection: failure to distinguish correlation from causation will have been merely correlated with our demise.
I think that was abstract in the wrong way. Like “is college good” it assumes “education” is uniform stuff, buy it (or dispense it) by the quart. Actually, cost, quality, and applicability to future employment prospects vary greatly. There is not actually a single answer, and for that reason there cannot be a single causality.
#1: from the graph with green bars…….lesson #1: don’t go to college if you’re not aiming (at least) for a professional degree. licensing is good, hahaha
Reagarding #1, It looks like this comment from the WP got it right:
philshaw 11:48 AM CST
The value of a college education depends on which sort of college education it is:
Career-oriented, e.g. engineering, law, nursing, hotel management,…
Hobby-oriented: e.g. jazz performance, modern dance, theatrical lighting, art history, etc. I.e. fields in which there are only a handful of real jobs, and those few jobs are available only to the extremely talented and to those with inside connections.
For someone in their 20′s to borrow tens of thousands of dollars to pay for a career-oriented college education can be a good investment. To do the same for a hobby-oriented college education is a foolish extravagance, but colleges encourage their students to do so.
I would not trade the money/time I spent on college for the money/time now, except for the opportunity to repeat college and focus on a different degree.
I suspect that this is true for >50% of the holders of four year degrees.
I agree that college is not for everyone, it is typically overpriced, there are way too many degrees with negative returns, there is a cult of education, and so on, but let’s differentiate between a broken system and a useless product.
A quick mental exercise of the extremes, everyone with or everyone without a degree, should point out why continuing this debate is not valuable.
We need a better product, and we need to fix the system to do so.
Let’s also differentiate between luxury products and useless products. Much of higher education (and especially private, liberal arts education) are luxury goods.
One odd aspect of college is that the highly intelligent, highly motivated students, i.e. the ones who have the best chance of finding success even without a degree, are the ones most likely to be in a position to pay very little for a degree. Now, to be sure, lots of them end up paying large sums for the privilege of attending “elite” institutions, but in doing so many of them are turning down a free ride at “Large State U.”.
3. More evidence that the terrorists are right about the evil that is the US government.
They could do with some conflict resolution skills. Both of them.
Can someone remind Obama the definition of democracy is changing governments without bullets?
Google “American Revolution”
Oh. Is that what we are doing in these countries by helping install Islamists? Because I was under the impression that it was darn near the exact opposite of them setting up their own free republics.
So your statement was obviously incorrect and you countered with another flawed statement. Maybe you missed your calling as a lawyer or a social science grant writer. I thought better of you.
Transitions to democracy/republic type goverments have periods of violence. Even Ghandi’s approach didn’t eliminate violence.
Do you believe that people should able to rule themselves as they see fit as in a democracy or a republic?
Or do you think that if they choose an option you are uncomfortable with it cannot be a democracy?
Islamist governments exist because the populace supports them.
Aren’t you just proving Andrew’s point with that comment? That is, the American colonies didn’t have a democratic government, so when they wanted a change they had to fight a revolution. Afterward they set up a democracy, and they were able to get change without so much bloodshed. You’d have had a stronger argument if you’d picked the American Civil War as an example.
If you are differentiating from between a democracy and a republic, the US has never been a democracy.
The Civil War was a war that increased the federal power. Nothing to do with a change from republic to democracy.
There has never been a large scale effort to remove our representatives and replace the system with a direct vote in the US.
The definition of a democracy has nothing to do with bullets. Use dictionary.com and look up democracy.
2. I don’t understand what the point is, when Zurich has plenty of “normal” brothels (and the ability to build more if needed) where the girls could work.
Maybe some people prefer a “drive-through” brothel to a normal place with bedrooms?
Maybe it’s cheaper?
At any rate, it’s quite cute.
“Maybe it’s cheaper?”
You’d think so, but from the article:
There are some doubts, however, that the prostitutes and their customers will use the facility — which is said to have cost 2.1 million Swiss francs ($2.2 million) to build and 700,000 Swiss francs ($750,000) a year to operate.
Different market segment – drive through fast food vs. proper sit down dining.
@JWatts: yes but that is a public subsidy born by neither the prostitutes nor the johns.
this is for entrepeneurs, 1 woman brothel
“Another set of studies use a method called “instrumental variables” to isolate the effect of education. ”
Add that to the list of funny sentences.
6. My first thought is because, in India, cows are a consumption good?
and in rural farming areas a depreciating asset (milk, field labor)?
and in rural farming areas without access to finance, still a better store of value than any other option?
Cows and buffalo: is it a similar reason to why Americans have a yard that needs mowing and landscaping that requires work/and or maintenance most of the year?
Having your cow but not eating it = conspicuous non-consumption?
1. There must be a substantial number of college graduates or dropouts who have a lot of student loans and found, over their time in college, that college was not for them (didn’t like lecture format, didn’t like the materials, wanted to do something else). Some of these young people surely want to become electricians, plumbers, and etc. and can make a very good living doing so and their loans are a burden.
Our desire to encourage everyone to go to college is nice and we don’t feel like elitists for discouraging some. But it can also be elitist to think that the “good life” is almost always found via a white collar job after a college degree rather than as a humble electrician or plumber (who makes 6 figures) after vocational training or apprenticeship.
Ideal, fantasy compromise path: a future electrician goes to college to enjoy the once in a lifetime social experience and to broaden his/her mind. And he minimizes his loans by, e.g., working during school.
But how many young people know what they want to do after college? Some will say college will open options. Others will say the loan burden will be crushing and the liberal arts degree will open few doors. I say go to college, but try your best to minimize loans and explore various careers during school.
#1. Answers a different question than it asks. The question it answers is “Do college graduates earn more than others?” That doesn’t say anything about whether college is worth it. If college cost each student $1 million, college graduates would still be making more money than others with a lot more debt to repay. Would anyone say then that college was worth it?
This is a false debate. Very few people are arguing that college graduates make less money. What they’re saying is college costs too much for what it delivers, that too many people go to college that shouldn’t and too many employers require college degrees for tasks that don’t need it.
#6 My father owns about 50 cows and uses tax breaks (farm equipment writeoffs). for any chance of profit. Why? Because its in his blood and makes him feel like John Wayne.
My father owns about 50 cows and only profits thanks to tax writeoffs. Why? Because its his tradition and makes him feel like John Wayne. It’s very hard to profit off beef without an operation of massive scale.
#1. The article makes a good case that having a college degree increases earnings, but makes a weak case against signaling.
More importantly, I find it odd that the discussion in US revolves around going to college instead of studying a specific subject. I think the debate would be much better if we compared earnings of different majors.
The subject that one studies is a lot less important than the type of college that one goes to (4-year vs 2-year; elite vs open-admission), which in turn is a lot less important than the question of going to college at all.
The military-industrial complex and our military superiority makes us believe too much in the power of military intervention to effect improvements in people’s lives. I am reminded of Tyler’s Blogging Heads interview with Peter Singer and Tyler’s point about immigration being perhaps the best instrument for raising dispossessed people’s welfare. Maybe the best thing the world/UN/US could do is welcome the Syrian refugees in Jordanian camps and anyone who makes it to a border.
I like this is in theory but while republics are capable of absorbing a lot of voters from places with bad institutions, there are limits to how much of that is possible before their own institutions are degraded to the point you’ve destroyed what you were trying to offer.
If I were in charge of designing the pictograms for the drive-in Swiss brothels, I’d add another sign, this one aimed at the hookers who work at the facility: a women’s razor with a red slash across it.
1. I think there’s a big problem with this that he doesn’t address — people of various educational attainment have certain characteristics in similar degree to said attainment, characteristics that also lend themselves to earning higher incomes. Information is very decentralized and very easy to acquire today, probably most of those people could have achieved the same education without paying tens of thousands of dollars (say, by utilizing things like MRU).
Aside from signalling to employers (which is valuable), perhaps the largest value college offers re employment today is a truly collegiate one — learning to work with others?
The good will hunting argument. It’s obviously possible to learn things by just sitting in a library (or on the internet) and reading like crazy. But that is extremely difficult. College makes it much easier. If you were to have sat a young Urso in front of a fully stacked law library and said “learn the law” I wouldn’t have known how to begin. What to read first? How to organize this mass of information? And if I start going down the wrong direction, who is there to guide me back? Intellectual autarky is a difficult thing.
Well, that kind of data organization now exists outside traditional college thanks to online courses like Udacity and MRU.
High school Grad earnings: $28,000/year
College Grad earnings: $49,000/year
Colleges total per student cost per year: $30,000/year
Student’s forgone earnings : $28,000/year
Total cost including forgone earnings: $240,000
Total return state pensions estimate to stock ownership : 8% (I know that it is ridiculously high but this fun).
Return on college degree: $21,000/year
Return on $240,000: $19,000/year
Getting close, and if you are studying subjects like sociology, history or psychology (which you can study for free in your free time)it is probably better to forgo college.
Tyler’s point about immigration being perhaps the best instrument for raising dispossessed people’s welfare.
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