Education in Mao’s China

by on March 28, 2015 at 3:02 am in Books, Education, History | Permalink

Advancement in China’s school system was highly competitive, and the odds of reaching the top of the educational ladder were very steep.  Of the 32.9 million children who entered primary school in 1965, only 9 percent could expect to enter junior high school.  Only 15 percent of junior high school entrants, in turn, could expect to graduate and enter high school.  Among the highly selected groups that graduated from academic high schools, only 36 percent could expect to enroll in a university.  Of those who entered primary school in 1965, only 1.3 percent could expect to attend an academic high school, and only one-half of 1 percent could expect to attend university.

Of course the Caplanian point is that China managed a lot of post-1979 economic growth with what was fundamentally a not very educated generation.

That excerpt is from Andrew G. Walder’s China Under Mao: A Revolution Derailed, my previous post on this excellent book is here.

Here is one excerpt from his very interesting post:

I get and very much like the skeptical, anti-theoretical thrust of Strauss. I like his deep wariness of ideal theorizing, his exhortations to pay attention to the political life we are always already living. He’s right to see reasoning with others about about how to live as an inherently political activity. He’s right to insist on honoring the distinctive excellences of those sensitive to the texture of real political life and expert in its ceaseless negotations. He’s right that social scientific theories about politics are less politically valuable then good political judgment, and that people who think they’re going to govern “scientifically” are dangerously stupid. (Paraphrasing, here.) And, yes, when philosophy is merely a handmaiden to the dogmas of our age, pursued under the “ecumenical supervision” of the universities, it is profoundly compromised. To be a philosopher is not to have a job you clock in and out of. To be a philosopher is simply to be, philosophically, always. Right! But the Socratic life is the one very best life? The naturally right, life? Nope. Nope. I’ve read and read and never quite follow how we end up there. I mean, I think this is a great life, beyond wonderful. But nope.

Anyway, Strausseans are strangely obsessed with this idea that the philosophical life, so construed, is the best human life, full stop, and are therefore obsessed with the tension between the best life, which is in the business of exposing bullshit, and the political life, which is built on it.

I am very happy to order this book in advance, I hope Will lets me know when that is possible.

I may not follow any of your suggestions, but just thought I should ask for advice, for my dialogue with Peter next week.  I am the interviewer, he is the interviewee, more or less.  #CowenThiel

File under The Culture that is Germany.  Here is the rest of the abstract:

In this article, we investigate cosmopolitan attitudes among the people often considered the most cosmopolitan – the elite. Studying the typical class of frequent travellers provides a particularly good opportunity to study the relationship between transnational activities and cosmopolitanism. We also comprehensively investigate the link between postmaterialist values and cosmopolitan attitudes. We test our arguments using an original dataset that includes a relatively large sample of the German positional top elite in the years 2011 and 2012. A comparison between these data and data from a general population survey shows that while transnational activities affect the attitudes of ordinary citizens, increased travelling does not make elites more cosmopolitan. We discuss several reasons why this might be the case. We also observe that postmaterialist values and the ideological environment of the elite play a key role. Finally, we tentatively suggest that cosmopolitan elites do not endanger national social cohesion, as some fear they might. We show that cosmopolitanism and localism are not mutually exclusive and that members of the German elite feel even more attached to their nation than ordinary Germans.

Like my source the excellent Kevin Lewis, I wonder how much this applies to other nations as well.

At the Massachusetts Institute of Technology, a premier source of young recruits, only 9.9 percent of undergraduates went into finance in 2013, compared with the 31 percent that took jobs on Wall Street in 2006, before the financial crisis. Software companies, meanwhile, hired 28.1 percent of M.I.T. graduates in 2013, compared with 10.5 percent in 2006.

That is from Popper and Dougherty in the NYT, via Binyamin Appelbaum.

Tradeable Pollution Permits

by on March 23, 2015 at 7:37 am in Economics, Education, Film | Permalink

The latest release of our principles of economics class covers Externalities, Costs and Profit Maximization, Competition and the Invisible Hand, and Monopoly.

I am especially fond of our video, Trading Pollution, which explains the economics of tradeable pollution permits. Tyler and I worked with the incredibly talented team at Tilapia Film for a long time on a montage involving jigsaw puzzle pieces that’s near the middle of the video. The montage is only a few seconds long but I think it’s a beautiful way of illustrating how the price system draws upon information that is dispersed across many minds. There is a lot of deep economics behind the visual metaphors.

Addendum: For those of you using our textbook, this video and others are available directly from the textbook (using QR codes) and also available with assessment in our course management system, Launchpad.

The article is here, by Lauren Pelley, here is one excerpt:

“It’s great news to hear,” echoed Ganesan Sugumar, CEO and director of Saravanaa Bhavan Canada, an Indian vegetarian restaurant chain. (Cowen’s tour group visited the location near McCowan Rd. and Finch Ave. East.)

“This is honestly the best cuisine, I could say, in Canada,” Sugumar added. “We have so many ethnic restaurants.”

The article also has a useful map of all the places we visited.  My original blog post was here.

There is an interview with me by Emily Hare in the latest issues of Contagious, a glossy British marketing periodical.  Here is one bit:

Q: What should marketing do to ensure it lives up to its potential?

A; This is what I see happening and this may be disquieting for some of your readers.  The people who are really good at marketing in this new environment are typically not formal marketers, they are not called marketing agencies, they have not studied marketing.  They are people who know some areas very well and then they teach themselves a kind of marketing on the fly.  A good examples if Facebook.  Mark Zuckerberg is not in any formal sense a marketer, but he’s actually one of the most brilliant marketers that the world has seen in the past few decades.  General principles are not that useful anymore.  What is paying off is incredibly detailed, context-specific knowledge of particular areas.  that’s what it takes to craft unique messages.

At all levels we’re seeing this takeover by the content people and everything is supposed to look authentic, so in a sense, authenticity is the new inauthenticity.

Marketing has never been more important, but life has never been tougher for at least some of the marketers.

I do not believe there is a version of this on line.

The highly esteemed and extremely proficient Thomas MaCurdy has a new piece in the JPE (jstor) on exactly that question.  The news does not surprise me:

This study investigated the antipoverty efficacy of minimum wage policies.  Proponents of these policies contend that employment impacts are negligible and suggest that consumers pay for higher labor costs through imperceptible increases in goods prices.  Adopting this empirical scenario, the analysis demonstrates that an increase in the national minimum wage produces a value-added tax effect on consumer prices that is more regressive than a typical state sales tax and allocates benefits as higher earnings nearly evenly across the income distribution.  These income-transfer outcomes sharply contradict portraying an increase in the minimum wage as an antipoverty initiative.

MaCurdy also writes:

About 35 percent of the total increase in after-tax benefits goes to families with income less than two times the poverty threshold, a common definition of the working poor or near-poor; nearly 13 percent goes to families principally supported by low-wage workers defined as earning wages at or below 117 percent…of the new 1996 minimum wage; and only about 14 percent goes to families with children on welfare.

Unlike most public income support programs, increased earnings from the minimum wage are taxable.  Over 25 percent of the increased earnings are collected back as income and payroll taxes…Even after taxes, 27.6 percent of increased earnings go to families in the top 40 percent of the income distribution.

File under “Scream it From the Rooftops!”  I do not see an ungated copy, but here is an earlier 2000 paper (pdf) by MaCurdy, with O’Brien-Strain, with broadly similar conclusions.

From that same JPE issue, cream skimming effects seem to be pretty small when it comes to school choice.

Sentences to ponder

by on March 16, 2015 at 3:07 pm in Data Source, Economics, Education, Medicine | Permalink

Overall, our findings suggest that correlations observed in affluent, developed countries between (i) wealth and health or (ii) parental income and children’s outcomes do not reflect a causal effect of wealth.

The paper is here, commentary from Arnold Kling is here.

You can sign up for rsvp or the live stream here, the chat with Peter Thiel is March 31, 2-3:30 p.m. EST, held at the Arlington campus of George Mason University.  It is part of a new event series Conversations with Tyler.

The chat with Jeffrey Sachs is April 7, 3:30 to 5 p.m., again EST in Arlington.  There will be more to come in the Fall.

I will host and talk with guests, but without formalities.  I won’t ask “So tell us about your new book,” or any of the usual soporific chit-chatty questions.  I will try to replicate the conversations I would have with these same individuals in a private setting, except that you all get to listen.  That means launching into substance immediately and seeing how far the back and forth can be pushed.  It also means asking questions that not everyone listening will understand and willing to let parts of the audience suffer in their confusion.  I want these dialogues to be as smart as possible, based on the premise that each guest, no matter how renowned he or she may be, is nonetheless a radically underrated thinker.

The goal is to be never hostile or combative, but always probing.  I’m aiming for the chat to be 1/3 me vs. 2/3 guest, more or less, but about the ideas and contributions of the guest most of all.

The Open Borders Manifesto

by on March 16, 2015 at 7:30 am in Economics, Education, Law | Permalink

In honor of March 16, Open Borders Day, here is the Open Borders Manifesto to which I am a signatory.

Freedom of movement is a basic liberty that governments should respect and protect unless justified by extenuating circumstances. This extends to movement across international boundaries.

International law and many domestic laws already recognise the right of any individual to leave his or her country. This right may only be circumscribed in extreme circumstances, where threats to public safety or order are imminent.

We believe international and domestic law should similarly extend such protections to individuals seeking to enter another country. Although there may be times when governments should treat foreign nationals differently from domestic citizens, freedom of movement and residence are fundamental rights that should only be circumscribed when the situation absolutely warrants.

The border enforcement status quo is both morally unconscionable and economically destructive. Border controls predominantly restrict the movement of people who bear no ill intentions. Most of the people legally-barred from moving across international borders today are fleeing persecution or poverty, desire a better job or home, or simply want to see the city lights.

The border status quo bars ordinary people from pursuing the life and opportunity they desire, not because they lack merit or because they pose a danger to others. Billions of people are legally barred from realising their full potential and ambitions purely on the basis of an accident of birth: where they were born. This is both a drain on the economic and innovative potential of human societies across the world, and indefensible in any order that recognises the moral worth and dignity of every human being.

We seek legal and policy reforms that will reduce and eventually remove these bars to movement for billions of ordinary people around the world. The economic toll of the modern restrictive border regime is vast, the human toll incalculable. To end this, we do not need a philosopher’s utopia or a world government. As citizens and human beings, we only demand accountability from our own governments for the senseless immigration laws that they enact in our name. Border controls should be minimised to only the extent required to protect public health and security. International borders should be open for all to cross, in both directions.

See here to join as a signatory.

What sport should your kid play?

by on March 11, 2015 at 12:45 am in Education, Sports | Permalink

After I requested requests, Trey Anastasio asked me:

If a parent were to pick a sport for their child to play competitively, what would you suggest? (factoring in cost, commitment, personal development, opportunities provided in life)

I take this to refer to stardom in high school or college, but not beyond.

I am inclined to select tennis.  It doesn’t cost so much, and you can play for most of the rest of your life, without needing a team to back you up.  It is unlikely to injure you very seriously, although arguably it cultivates an attitude of selfishness.  Various areas of track would be reasonable picks too.  If this is restricted to major team sports, I say baseball, mostly to minimize risk of injury or violence.

That said, my overall sense is that levels of competition in all of these areas have become higher than is socially optimal.  Little League success will suffice for a lot of the gains in terms of learning leadership, discipline, and teamwork.  So I would not wish any of these upon a child.  These endeavors have become academic fundraisers where levels of competition are pushed as high as the talent allows, and too often they have become all-consuming pursuits, in violation of Aristotle’s edicts about moderation.  Sports have gone from a very cheap way of educating your child to a very expensive way, yet another example of unmeasured declining productivity in education.

Even though the Greek electorate has elected left-wing leaders, the “the Greek government” hasn’t actually changed all that much.  It is still dysfunctional, corrupt, and very protective of special interests in nationally harmful ways.  Yet I find that if I criticize the Greek government on Twitter I receive many angry, self-righteous comebacks, often but not always from Greeks and usually with a left-wing slant.

One reason the Greek government is so popular with “the Left” has to do, I think, with theories of social change.  I often read or hear it suggested that, if only the truth is spoken in forthright, galvanizing terms, beneficial social change will follow.  This was a common meme in Krugman’s columns for instance over the years.  The claim was that Obama needed to be more like FDR and mobilize a coalition around a commonly articulated series of truths.  I don’t think it was ever promised this would succeed right away, due to Republican intransigience, but it has been portrayed as a good long-run investment in political change through the education of the citizenry.

The new Greek government of course has done this and more.  They have rather flamboyantly staked out extreme positions, insulted their opponents, and warned of the doom that will follow if renegotiations were to run along the lines of EU law rather than the New Old Keynesian economics.  They told their citizenry how much they were standing up for them, and how much this was a moral clash of progressive good vs. austerity evil, with the values of democracy and national sovereignty (supposedly) on the side of good.

The thing is, it’s turned out to be a total catastrophe.  As I had suggested early on, there is, in the ruling Greek coalition, no Plan B.  Germany and especially Spain just held tight on the negotiations and the Greek government more or less had to fold, not even wanting to vote on the negotiated plan.  That plan then failed to receive European approval, nor has Greece drummed up much general support from the other peripheral countries, and now no one knows what to do next.  The ECB, IMF, and others still have Greece “by the balls,” to cite one colloquial expression.  They’re still trying to spin that “the institutions” are not the Troika, but they don’t talk much about liberating the economy as a means of increasing exports.  It seems Emergency Liquidity Assistance may be up for review.  Oops.

The Greek government also riled up its citizens and now doesn’t know how to deliver anything satisfactory to them, to the detriment of political stability.  The latest irresponsible plan is to threaten a referendum on a new government, a new economic plan, or in one case even a referendum on euro membership was mentioned.  Message discipline is scarcely to be seen.

All of that is simply painting the Greek government into a corner all the more, since a referendum will simply heighten the demands for mutually inconsistent outcomes.  Signs of broader eurozone recovery, and the relative success of QE in talking down the value of the euro, have almost completely removed the bargaining power of Syrizas, or so it seems as of early March.

As I’ve said before, these people ruling Greece are The Not Very Serious People, and they are increasingly acquiring a reputation as such within the rest of the EU and eurozone.

All of this reminds me of the wisdom of Dani Rodrik and his propositions about the incompatibility of democracy, national sovereignty, and global economic integration.  Angry words won’t undo those constraints and they are not something you will hear the Greek government mention very often.

Krugman a few times has praised Syrizas for renegotiating the required primary surplus figures, but it seems this is hardly mattering.  Due to plummeting tax collection, the primary surplus is gone in any case, and the agreement with “the institutions” [read: Troika] is not even the main driver of the action here.  Greece needs to take steps to reestablish a higher [read: positive] primary surplus in any case.

The broader lesson is this: if politicians are not “speaking the truth to power,” there are usually some pretty good reasons for that.   As a political strategy, it doesn’t typically work and it is worse than irrelevant as it very often backfires.

The situation is still not beyond repair, but the Very Serious People are serious for a reason.

That is a recent question from Michael.  I am a biased source, but I say yes for three reasons:

1. A master’s in economics, or for that matter many other areas, is of considerable value if you are working in the DC bureaucracy and trying to scale the ladder.

2. A master’s in economics can be of value in a non-profit organization.  It shows you understand the material, and can in some way help promote it, even if you are not producing the research yourself.

3. As Bryan Caplan will be chronicling, there is an increasing demand for degrees and advanced degrees in many endeavors, even when the degree appears irrelevant to the nature of the work.  Having a Master’s can set you apart from the crowd.

4. If you study more economics, you actually learn something.

Those of you with the highest of elite aspirations should opt for a Ph.d of course, but still the Master’s in economics will be making somewhat of a comeback.  I mean this as something above and beyond the terminal Master’s often given to those who, for whatever worthy reason, do not finish their Ph.d degrees.

I do not readily find good data on line about the economics Master’s, do any of you know of good sources?