Saturday assorted links

1. Questions that are rarely asked: “How many who think we shouldn’t judge schools by how well students do also think we should judge companies by wages?”

2. An economist gets dessert, sort of (apologies for the video when you click on the link).

3. University of Maryland to spin off its data analytics division into a new company.  Solve for the equilibrium.

4. The grey market foods of New York City.  And Arnold Kling on Fiorina and Trump.

5. Data on Uber’s surge pricing, it keeps the expected wait time within a remarkably consistent range.

6. UK scientists apply for license to edit genes in human embryo.

7. The smart basketball.  Nein, danke, I prefer self-deception to keep me on the exercise track.


1. This has got to be one of the stupidest comments I've read in the past week. Companies don't exist to pay wages; they exist to satisfy consumers. I guess we should judge schools by how much they pay teachers.

Judging from the headline alone - couldn't that be the point? There is a high overlap in those sentiments (mostly in liberals), and both are ridiculously misguided.

Where is the evidence that either opinion is common among "liberals" or anyone else. There is some research that highly profitable firms pay premium wages but it would still be odd way to judge a company.

He has a blog post too on it. He's saying that liberals judge walmart as worse than costco because their wages are lower. However they don't control for any population differences in the employees backgrounds. On the other hand, they say that you need to control student cohorts in public vs private school comparisons (until private started winning and then we simply can't know that public schools are doing worse because too much to control for). He's pointing out that either radical skepticism or aggressive controls are only demanded when political opinions align with the cause.

It's still highly foolish. Different wages at Walmart and Costco are an effect, of different strategies. Walmart sets out to pay its employees low wages. Mix differences in schools are a cause, at least in public schools. Private schools traditionally are selective, which tends to make achieving high academic performance much easier.

By the way, it sounds like you're arguing from mood affiliation.

It's foolish to assume that the only difference between Walmart's and Costco's employees are their wages. Costco is selective, which tends to make achieving high wages much easier.

Another question people rarely seem to ask, when evaluating claims like this, is "am I arguing with a straw man?"

Or perhaps, "does the implication/veiled argument of this question satisfy me so much that I fail to evaluate the priors?"

Companies don't exist to satisfy consumers . They exist to maximize Shareholder value. As a consumer for eg I have a miserable experience with ADP , 40 minute wait times and total foul-up at times. Because of the costs of shifting and various other constraints and the fact that I have had bad experiences with their competitors , I am still their consumer albeit an unsatisfied one. And as long as I am their consumer, they are maximising their Shareholder value.
I'm sure there are many other examples: perhpas some Cable and internet companies, Some Anti-virus software companies

The more a company removes cash from the economy to build up shareholder value, the better the company because it is most successful in grabbing the maximum share of stagnant or declining GDP?

Or perhaps, the better a company is a crony capitalist lobbying government to print money and paying that to the company directly or in welfare to pay its customers so it can increase its shareholder value by accumulating cash used to buy competitors too increase monopoly profits.

Clearly, paying workers more to boost GDP growth is for fools and should be done by government.

Clearly whatever company sells you hobbyhorses is creating shareholder value and a big consumer surplus. You are the most annoying and repetitive person I have ever encountered on the Internet. We get it Ronald Reagan banged your girlfriend move on already.

I think his comment represents legitimate critiques.

If they trouble you, you should face them head on with sound counterarguments instead of personal attacks.

Companies have different functions and complete many markets.

As an employer we generally rate companies by their wages.
As a producer of good services we rate companies by their price/value.
As an investment we rate companies by their profit.

The higher their profits the more a company is bankrupting other companies by starving them of consumers paid enough for their work to keep the companies solvent?

"Companies don’t exist to pay wages; they exist to satisfy consumers."

Consumers who get all their money they spend from government?

Or are you arguing that companies exist to amass all the wages other companies pay in wages, and spent as consumers, in their coffers in order to bankrupt all other companies?

mulp, I don't think you understand the concept of the "free market". Learn a little bit about it before spouting off your idiocy.

Instead of personal attacks you could have pointed out the following:

It is universally agreed in economics that companies have a single objective: to maximize profits.

This is stated in the form max(Profits) where Profits = Revenues - Costs.

"Companies don’t exist to pay wages; they exist to satisfy consumers."
Ha ha ha.

Without having read the comments, let me suggest that what is being suggested here is that *inputs matter*. That's what we hear from the left when they are explaining away failing schools. That's what we hear from teachers when they are explaining away their failing students.

Public schools are *obligated* to educate the children in their administrative district. This isn't even remotely analogous to any kind of employer-employee relationship, private or public.

Why educate students? Why not save money and raise uneducated children? Let companies teach its workers to read and do math if they need workers who can read, or do math.

Public schools seem to exist on the same principle that government should give companies factories and build the machinery to fill it so the company can make a profit. Further, government should fill the factory with robots so the company does not need to be burdened with paying wages.

Companies should have no responsibility for putting money in the pockets of consumers. Republicans have taken on that job as legislators who promise to put money in the pockets of consumers to spend.

Because then we'd be over-run by poorly self-taught cranks like you with no marketable skills, but lots of time to spend at the Public Library on the Internet. Frankly I wish libraries had stop blocking porn so you could get back to your first love.

Rich Berger,, companies exist to make money and that is how we judge them. Some make money by using highly productive and well paid labor and some use cheap,low quality labor. We need both types and should not pre-judge that one type of business organization is superior. McDonald's uses cheap labor and Microsoft uses expensive labor,
but that does not mean that one is necessarily better than the other.

On the other hand the objective of schools is to educate the students, so they should be judged on that. The complication is that it is very hard to tell how much the students learns is due to the teacher or individual school and how much the student brought with them.

You endorse cheap labor companies along with expensive labor companies because you expect the workers of cheap labor companies to get government cash so they can afford to buy the products of expensive labor companies?

And you expect the food you eat to be of low quality because almost all workers in the food value chain are cheap workers and thus of low quality so they will not exercise any care to remove bones or to not drop it on the floor or not drool or cough on it?

But do you expect the expensive labor software in your car to have security bugs so your high quality car can be hacked to cause you to crash?

mulp, you realize economies existed before any such thing as government monetary policy? Why do you think cheap workers will be of low quality? Remember, backwards-bending labor supply curve.

"Microsoft uses expensive labor"

You can still buy software in a disc, correct? Not too long ago it was the only way.

Are the people on the manufacturing line well paid? Perhaps they are.

Do the people who clean Microsoft offices get paid well? That I doubt.

Companies use a mixture of cheap and expensive labor.

It is unlikely that the people who clean the offices at Microsoft are employees of Microsoft.

No. That's not how "we" judge them. That is certainly one sensible way to judge them, especially if you are an investor or are otherwise interested in their financial performance. (Though note that even in that arena some companies are judged by matters other than sheer profitability). But it is not a universal standard, trumping all else.

"On the other hand the objective of schools is to educate the students"

I easily agree. I think the disagreement comes when discussing the extent to which we expect schools to educate students into being "good citizens", whatever that means in the broader sense, and the more narrow expectation that schools should educate students to be "good workers".

"Good citizens" need to have knowledge of history, philosophy, different aspects of one's own society and other societies, as well as basic abilities in math and knowledge of science (or the scientific method, to be precise). Language and communications skills are important in all of these.

"Good workers", however, may be able to do quite a lot of jobs with little/no knowledge of history, philosophy, society, etc., and may be indifferent between working in a Nazi regime, in unfettered capitalism, or some alternative economic setup.

A "good education" does more than simply prepare people for the job market, but I think that people of various extreme ideological/religious positions are bothered that state education doesn't bend sufficiently to their preferred ideological position. Thankfully (perhaps), these people can home school their children.

The problem with #1 is that it fudges the meaning of the word "judge." There is a difference between personal preferences and objective standards of measurement.

When it comes to companies, there are different judges, and different responses to varying judgments. An investor will reasonably enough judge a company by its financial performance, but a potential customer may, also reasonably, judge it by wages, whatever that individual's attitude towards schools is. If a consumer chooses not to shop at WalMart because it pays low wages, or to deal with some other company because he dislikes some of the company's business practices, that is a perfectly rational decision based on the consumer's preferences, just as ignoring those things and looking for the best price and service is, or ignoring them and deciding to invest is.

Silly question, in other words.

If a company refuse to hire the graduates of US schools and goes to Germany for its workers, that's ok because the US government will pay the living costs of the unwanted US grads, in prison if necessary?

Is it a good thing to stop supporting the ExIm bank because the banks who have so much cash they pay zero to negative interest can do the job, but refuse to take on the risk, so Boeing is moving its factory to France where the government will replace the ExIm bank role in exchange for Boeing paying French workers high wages.

The big picture is the role of government and who it serves relative to the role of the private sector and who it serves. Can the private sector not serve all the people? Can government not serve all the people?

mulp, you're being even less clear than usual here. Go away with your pathetic nonsense.

"potential customer may, also reasonably, judge it by wages"

Nothing "reasonable" about judging by wages.

Price, product quality and service are the only reasonable ways to judge whether you should be a customer.

"Judging by wages" is just social signaling, that "I care". Its a luxury that only "activists" and idiots [but I repeat myself] engage in.

Nothing “reasonable” about judging by wages.

Why not? Just because that doesn't reflect your value system doesn't make it wrong. The idea that "maximizing one's economic circumstances"is the definition of "reasonable behavior" is foolish.

I'm talking here about the decision a consumer makes as to who to do business with. There is absolutely nothing unreasonable about considering non-economic factors.

Tell us, Bob, how you judge Volkswagen.

4 Kling on Tyler on Republicans as musicians

I guess the Republican debates are like a death metal concert. We are doomed and surrounded by death and death is the answer.

Kasich got on the bill thinking it was going to a happy Reagan concert.

Yeah, it's a really stupid question.

Schools can't be judged on outcomes so directly linked to cognitive ability and innate personality. Not that this stopped anyone before.

What schools should be judged on is whether their charges are safe. I'm not sure anything else is possible. We could judge them on whether the charges are progressing along a vertical or horizontal path--that is, learning more or learning how to do more with what they know--but we can't do that without acknowledging that students differ in ability.

Recently, reformers have gotten into a tizzy because they've realized, finally, that increasing fourth grade test scores has no impact on high school ability. This data has been coming at them for years (I wrote about it here 3 years ago), but for some reason the declining SAT scores, coupled with a decade of 4th grade increases, has forced it to sink in. Not that SAT scores are a perfect gauge of ability, but then someone inevitably mentions the stagnating 17 year old NAEP scores. Meanwhile, while the new Common Core scores were pretty dismal for 4th and 8th graders, the falloff for high schoolers on college readiness weren't dismal, but about the same. Which is, oddly, good news.

Maybe we are coming to an end of the magical belief that schools are successful by how much more, earlier, we stuff into kids' heads, given the quantum leap in difficulty high school expectations represent.

But until then, safety is about the only thing we can accurately and fairly judge schools for.

So why paying the premium to pretend teaching them instead of spending just enough to keep them safe and out of the streets (I guess it is the whole point, otherwise they could just stay at home)?

A critic of Educational Testing Service remarked a generation ago that their press agents were forever arguing in the alternative: "there is no problem; the problem has been corrected; the correction made no difference". It's a vice of people in a certain trade with a certain disposition.

Of course, we might just ask why we have public agency provision of educational services. Educational services are not analogous to public works or the military. They can function perfectly well as a fee-for-service enterprises. The justifications for not doing so would be information deficits in the market and distributional questions, one of which can be solved through state administered examinations and published league tables and one of which can be solved by voucher distribution. Of course, if you blew up the NCATE - teachers' college - labor meathead - public interest bar nexus, some vested interests would be offended, and those vested interest man the phone banks for Democratic pols. So it will never happen.

Yeah, I kind of thought that we incorporate police forces and fire departments for the safety thing, but maybe that's just my low cognitive ability, or something like that.

Why? Because the second most important part of education is the creation and maintenance of a population of middle-class government employees and reliable Democrat voters.

Conceeding that your schitck is use alt-right buzz words to insulate teachers unions from alt-right criticism, if what you say is true then let's just hire a bunch of PE teachers and dispense with the charade. Are you willing to accept the subsequent diminuation in status and salary that will entail for your profession? Or do you think teachers shouldn't have to sacrifice anything in exchange for completely reconfigured expectations? I'm fine with treating teachers like day-care workers as long as they get paid like them. And we should probably look into eliminating summer break then too. Day-care is year round.

"Conceeding that your schitck is use alt-right buzz words to insulate teachers unions from alt-right criticism"

I think it's "conceding". Not sure what "alt right" is, but if you mean HBD and the like then I think you are saying that I am interfering with your usual response?

"Are you willing to accept the subsequent diminuation in status and salary that will entail for your profession? "

I have high status and salary? I grant you I'm making more than I thought I would, but status? High school teachers are the peasants of the cognitive elite--and of course, many would dispute the "elite" status, but I think over the 50% mark in college grad SAT scores qualifies.

"So why paying the premium to pretend teaching them instead of spending just enough to keep them safe and out of the streets (I guess it is the whole point, otherwise they could just stay at home)? "


", if what you say is true then let’s just hire a bunch of PE teachers and dispense with the charade "

You are both confusing "teachers don't have any impact on academic outcomes" with "teaching is unnecessary."

Leave 100 6 year olds out on the street without school for 4 years. No instruction at all, home or otherwise. They will be illiterate. (A few geniuses will figure out how to read and self-educate, maybe).

Put those 100 6 year olds in school for instruction. At the end of those 4 years, the academic outcomes will vary based on their cognitive ability. Not the school or the teacher. But all of the kids will be reading to the best of their ability, within reasonable variation.

In other words, teaching has to be done. While people have fantasized for a century or more that we can automate the process of instruction, we've had very little success. Think of teaching as a form of performance art, with a huge range of ability that counts as adequate for the purpose. The vast majority of kids have to be taught, and that teaching process seems to work, ideally, by giving someone the responsibility of transmitting that information. And no one has of yet come up with a better way of doing that for the masses than putting them in classrooms and giving someone the responsibility of transmission.

So teaching is still necessary. But how much information is communicated and consumed is entirely based on cognitive ability.

As for how much we're paid, that's very much a matter of the market. People would understand more about teaching if they grasped that administrators spend much more energy worrying about hiring teachers than firing them.

"I kind of thought that we incorporate police forces and fire departments for the safety thing, but maybe that’s just my low cognitive ability, or something like that. "

If parents are legally required to send their children to schools, then the schools must be responsible for maintaining a level of safety within the schools. Which is not a given in many urban environments.

However, in the sense you mean it--that is, public safety--teachers are a whole lot cheaper, literally, than both cops and prison guards.

I guess and MEd. degree does not include instruction in composing paragraphs.

the academic outcomes will vary based on their cognitive ability. Not the school or the teacher. But all of the kids will be reading to the best of their ability, within reasonable variation.

I think if you'd like to offer the thesis that outcomes are not particularly sensitive to the quantity and quality of inputs, others might find your contentions (which are arguments from authority in these fora) more cogent. Careering into Judith-Rich-Harris territory gets you chuckles.

I don't want advice, and wouldn't take it from you for money. You're not even good for chuckles.

As for the rest, there's plenty of data supporting my assertions. Here, I was just demonstrating why it's rather ridiculous to hold schools responsible for academic outcomes.

Maybe you should take his advice. Based on his posting habits he doesn't seem to have to work for a living.

So, you're arguing that teacher quality pretty much doesn't matter for outcomes? Doesn't that mean we should pay teachers even less, because who cares if the good ones leave?

You should read my comment again, since I answered that question.

We don't pay for good teachers, but for *any* teachers. Turns out that getting college graduates who can pass a credential test and a criminal check who are also willing to spend 6 hours a day in front of children with limited bathroom breaks is a tough thing to do.

So if you paid teachers less, you wouldn't get enough warm bodies for the classroom.

Now, supply problems are a bit varied, because we set the bar lower in elementary school in order to pick up some black and Hispanic teachers, leading to an oversupply of EL teachers. Meanwhile, we pay teachers roughly the same regardless of credential test requirements, which leads to an undersupply of math teachers in particular. And special ed is a brutal life that no one really wants to do--but then, it doesn't make much of a difference.

And of course, let me point out again that there's a difference between "teaching is unnecessary" and "teaching trumps cognitive ability". Both are false statements. Teaching is necessary, but when we look at test scores and blame teachers--at this point, there's no evidence that teachers make a huge difference in long-term academic outcomes, and very little difference in short-term ones.

"I was just demonstrating why it’s rather ridiculous to hold schools responsible for academic outcomes."

And do you believe it is likewise ridiculous to draw any conclusions from "comparisons of Walmart’s raw average pay to Costco’s"?

"How acceptable is a black-white pay gap versus a black-white test score gap? You hear that schools can’t be held responsible for fixing this, but I’m guessing most who say that wouldn’t accept a firm who tried to say it’s not their problem to fix."

I'm not sure what this even means. If you're trying to identify some sort of hypocrisy, I'm basically a Republican so probably don't think what you think I think.

Making school all P.E. would be a vast improvement over the current situation.

"Schools can’t be judged on outcomes so directly linked to cognitive ability and innate personality."

Why not? Seems to me if we do what you claim we are not, i.e. "acknowledging that students differ in ability. " then we can, we just have to take into account the difference in ability.

I dont have deep thoughts on education, really, but if the most you have to offer is "your kid is safe, nothing more" then perhaps you can see why people are looking for alternatives, be they school choice or standardized testing or what have you.

Education Realist actually notes a difficult problem with "adjusting for ability". For instance we have all these programs to close the black/white gap when children are young. However, when they hit puberty all the gains go away, mostly because puberty has a different effect on different biologies. So did the teacher who raised 4th grade test scores make a difference in the students lives worth emulating. Or was it ultimately a waste of time. Should that students high school teacher, who appears to be losing all those gains he was handed, be punished for the fact that black kids don't go through puberty as well?

This is terribly ironic considering the massive strides that have recently been made in evaluating teacher performance. It's quite basic to isolate the teacher influence, removing the student quality from the equation. Not easy to do, but the obvious thing to do and now they are succeeding.

"It’s quite basic to isolate the teacher influence"

Not really. First, it's impossible in high school, given that the kids are taking a different course every year and you can't measure "growth". Even in elementary school, however, the ability of a teacher to move the needle depends on the overall classroom ability level and the motivation of the kids. At best, VAM accounts for very little of achievement.

"then we can, we just have to take into account the difference in ability."

Great. So you have an algebra class, half of whom have a 6th grade math ability, a third of whom are actually ready for pre-algebra, and a sixth of whom are ready for algebra. The test will cover algebra. I did a before and after one year, just on broad numbers. Look at the difference in entering ability level, to say nothing of age difference and incentives, and notice that most kids stayed within the same broad range. You really want to say that these teachers, with the vastly different class abilities, could be rated and ranked?

"Making school all P.E. would be a vast improvement over the current situation."

In fact, NAEP achievement scores have risen for most grades over the past 40 years. Except at the high school level, which suggests that our expectations, not the teaching, is the problem.

When teachers are told to teach to a test, they will teach to a test.

I would be surprised to find that this ever (perhaps only rarely) leads to higher performance in the long run.

So, I conclude that standardized tests should be given to evaluate performance, but teachers should not be encouraged to "teach to the test".

Tyler, we have a mulp infestation, please call someone!

Judging by the comments regarding #1, the answer, alas, is far too many. Maybe I'm just suffering from MR fatigue and need a sabbatical.

Re: #1...the Huffington Post for one:

"I have been forced to comply with mandates that are not in the best interest of kids. I am tired of having to perform what I consider to be educational malpractice, in the name of "accountability." "

"According to Glassdoor, on average, a cashier at Costco makes $15.20 an hour. In contrast, a cashier at Sam's Club, a Walmart-owned version of Costco, makes $9.37 an hour on average. At Target, that figure is $8.18 an hour. Costco isn't hurting from its generous pay and benefits. While Sam's Club suffers from weak sales, Costco is on solid footing, bringing in close to half a billion dollars in profits last quarter."

Makes you wonder why Costco doesn't hire away all the Walmart and Target employees to open more stores, or at least it should.

Costco pays Walmart and Target employees $0/hr, the same amount that Walmart's critics pay. It's time for Walmart's critics and for Costco to do their part in lifting workers' wages by hiring all of Walmart's employees.

#4 Those lambda's in place of capital A's are a gratuitous distraction I hadn't encountered before, which perhaps was the point.

1. The reason the question is rarely asked is because it is an idiotic, nonsensical question.

#1. Few people believe we should not judge schools by how much the students learn (although that is difficult to do, but so are the alternatives) and few believe that we should judge companies (exclusively, mainly) by the wages they pay. I don't get the tweet.

I believe the tweet is directed at the many people that do, in fact, believe that schools, and particularly unionized teachers, should not be judged by student performance (or anything else, it seems). Many such people happen to have Left-leaning, pro-union beliefs and so happen to also judge companies by the wages they pay.

I am a liberal, have lots of liberal friends, live in a liberal neighborhood of a liberal city not far from where Tyler teaches ;) and have never heard anyone say teachers should not be judged or that schools should not be judged by how well they educate,

In a way this is not surprising I often read on the Internet about things that liberals supposedly believe which leads me to believe that people who write such, even taking account of a much wider range of views among liberals than among conservatives, have never actually had a conversation with a real live liberal. I even have a theory about where these supposed beliefs come from. My guess is that Conservative X hears about some idea he disagrees with and immediately conjures up the stupidest reason for supporting that idea he can come up with and projects that on the mysterious collective, "liberals." .

Have you ever asked? Im not being snarky here, this is the sort of thing which might not come up much without prompting. If i were the type who did believe that teachers should not be judged on the outcomes of my students, i dont think i would go around advertising that fact.

Try asking some teachers

"'When you hear someone talking about evaluations and getting rid of teachers, right away that's a non-starter,' said Michael Mulgrew, the president of the United Federation of Teachers" []

It would be difficult to be unaware of this, I imagine. Not sure how ThomasH missed the memo?

"...have never heard anyone say teachers should not be judged or that schools should not be judged by how well they educate."

Read the posts by education realist above:

"I was just demonstrating why it’s rather ridiculous to hold schools responsible for academic outcomes."

"My guess is that Conservative X hears about some idea he disagrees with and immediately conjures up the stupidest reason for supporting that idea he can come up with and projects that on the mysterious collective, “liberals.” "

LOL. Yeah. The trend seems to have reached new heights in recent years.


Put down the pipe. Buy a dog. Name it "clue"......then you'll have one

#5 People would have to act pretty funny for this not to be the result. This is a dog bites man story not a man bites dog story.

You are not surprised by the result because you happen to be economically literate. Many economically illiterate or economically dishonest people would claim that surge pricing is pure exploitation ("price gouging") that has no beneficial effect, raising minimum wages produce no negative employment effects, high tax rates have no negative incentive effects, etc., all examples of denying that price signals affect quantity demanded and supplied and/or that price movements help equilibrate supply and demand.

Having said all that, these results should not necessarily be completely predictable even to the economically literate. The surge pricing algorithm is an Uber invention. Uber didn't necessarily have to do a good job in properly setting the surge prices. It's not as though the surge prices are derived (directly) from two-way auction markets. The fact that wait times (and completion rates) remain stable shows that Uber was able to figure out a good algorithm. (If only central banks could similarly figure out a "surge money supply" algorithm to keep NGDP growth stable...)

Uber has a strong incentive to come up with a good algorithm. I'll bet the one evaluated is not the first one they tried.

I'm sure monetary authorities could stabilize the trend increase in NGDP if the incentives were right.

#4...Kling...Has anyone ever done a study of how the field of candidates influences the primary process? For instance, could we imagine a person entering the early debates with no chance to win, but whose presence in the debates is to savage or provoke one candidate to help another candidate, for future considerations, say? Or could candidates team up like Nascar drivers ?

The "University of Maryland" article is about University College, which is the continuing education campus for part-time and online students ("night school"). It is often confused with the flagship College Park Campus.

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