Arbitrage, by economics departments

Foreign STEM graduates (the acronym stands for science, technology, engineering and mathematics) can get visa extensions for three years of practical training (ie, work). Those from other disciplines are allowed only a year.

Two more years working in America means more earnings. It also means a better chance of finding an employer willing to sponsor an application for an H-1B visa, the main starting-point for skilled foreign workers who hope to settle permanently. In 2012 the Department of Homeland Security expanded the list of STEM courses. Now any reasonably crunchy economics degree can count as STEM with a tweak to its federal classification code, from economics (45.0601) to econometrics and quantitative economics (45.0603).

Economics departments appear to be catching on. Yale and Columbia have both changed the code for their economics major in the past few months; five of the eight Ivy League Universities have now done so. Students at Pennsylvania and Cornell are agitating for a switch.

Here is more from The Economist.


Yup. It's a smart thing colleges are doing. More H-1B visas would be best, say almost all employers and colleges. But you know that.

But what I really want to know is where do you get time and energy to write so many posts, interview people, teach, etc.? It's a prodigious amount of effort. My hat is off to you.

Clearly economists understand that fraud, cheating, lying, is highly incentivized in a free market, and they quickly compete by lying.

Oddly, the same economists complain about the complicated and detailed laws and rules trying to prevent fraud.

So: they are just are acting correctly according to economist's model. If econ departments didn't take advantage of legal loopholes then that would be contradicting their own models.

Regulators and governments in general never seem to understand that unless you are changing the base incentives directly, people will simply work around your efforts.

Or worse, they will find some way to twist and exploit them, producing an opposite effect. See finance for examples.

Well, OK. But so what?

That doesn't make it ethical.

Suppose I stupidly leave my wallet on the bar while I go to the restroom, and you steal it. My behavior was foolish, no doubt, but that does not excuse yours. You are still a thief.

Why should anyone celebrate this dishonesty?

What about sponsoring foreign economics students is so intrinsically unethical that it has to be regulated against by the government?

Nothing, Hazel.

What is "intrinsically unethical" is seeking undeserved privileges, for oneself or others.

Now, I myself would be happy to let these students stay as long as they like, up to and including permanently.

But that doesn't change the fact that departments seem to be willing to misdescribe what they do to get some advantage.

Let's get down to the basic issue: Why is it "fraud" to hire a foreign graduate student? Just because some government somewhere made a rule does not make it fundamentally wrong to do something that gets around the rule. Is there something intrinsically wrong with employing foreign economists as opposed to foreign econometricians?

Well, if American poor people must be economically displaced by Chinese slave work, why shouldn't American economists be displaced by, say, Asian economists? Theirs know Math and are actually winning the trade war.

China's per capita income is not yet 10k a year: By that metric, China's as wealthy as the US was during the Great Depression.

Of course there are quite a lot of human beings in that country, and geopolitics is a thing.

Also, if you ignore all the poor people, then the picture is quite different (statistics are kind of like that). Shanghai now has higher per capita income than a number of municipalities in the US (not the wealthy ones).

"Economics departments appear to be catching on". Read all about it: economists slow to appreciate incentives. But without moral scruple when the penny does at last drop.

science, technology, engineering and mathematics

Why should individuals with expertise in those areas be better residents and citizens than anyone else? How about people that are entertaining and amusing? Don't social skills figure in to it? Once again, the US displays its neo-Puritan worship of Mammon by tolerating, if not inviting, immigrants that will hopefully increase the income of current citizens, rather than their enjoyment of life. It's sick.

I hope you refuse medical attention from any foreign nurse.

Why don't we just let anyone who can get a job offer immigrate on an equal footing and let the market sort it out? If the market demands STEM workers, great, if it demands entertainers, great.

This same topic was covered earlier by Inside Higher Ed, and the article is not behind a paywall AFAIK. According to the article, small colleges such as Williams and Pomona are also doing this.

Before long, the title of this website, and Tyler's and Alex's book, will be changed from the Marginal Revolution to Econometrics and Quantitative Economics Blog, and the book title will be changed from Modern Principles of Economics to Modern Principles of Econometrics and Quantitive Economics, with translations in Chinese and Spanish.

An easy solution to this gaming of the system would be to statistically compute the typical earnings of graduates from any specific university major or program.

Above a certain threshold: 3 years.
Below it: 1 year.

Thus the English Literature Faculty at Snooty & Powerhouse Universities whose graduates earn well get more privileges than the Math & Physics Departments at Whatsamatta U where its graduates might be struggling to find any jobs.

That would tend to exclude positions with high positive externalities, where society enjoys a higher overall surplus from the labour compared to what they get paid.

Law schools have nearly perfected the gaming of that one.

"An easy solution to this gaming of the system would be to statistically compute the typical earnings of graduates from any specific university major or program."

I agree in principal, but that's still subject to gaming. Instead, just make it simpler. Any individual that falls below the threshold, can be charged against the university for the difference. The universities can charge a premium for those students to cover their expected costs.

And the threshold should be taxes paid equal or greater than the average (not median) American taxpayer. Which minimizes the extent that the general populace is forced to subsidize the operation.

All colleges and graduate schools, including State and other government-owned schools, that enroll more than 10% non-citizens should lose all of their Federal and State tax exemptions, concessions, special credits, etc. whether or not based on "charitable" status. Those are all subsidies from taxpaying citizens, and citizens should not be taxed to subsidize foreigners.

There's nothing wrong with selling educational services to foreigners, so there should not be any restriction or penalty on businesses such as universities doing that, on a for-profit, taxable basis-- just no taxpayer subsidy.

Of course, the fraudulent "O.P.T." extension of student visas into Congressionally-unauthorized work visas, to enable immigrants to take ordinary jobs after their schooldays are finished, should be abolished instantly. There would be no need for false coding of college or graduate programs if the incentive of undeserved visas were removed.

Not only that, but colleges are basically selling visas and opportunities to become citizens later.

It is not just the quality of education the college is selling, which explains why the discussion on immigration reform is reducing the number of foreign student applications.

"I WAS going to get pregnant and arrive with my soon-to-be anchor baby, but I figured, hey, I can accomplish the same thing and get a degree!"

Getting a degree makes the immigration process much easier and renders the anchor baby extraneous. Why wait 20 years for the baby to grow up and sponsor you, when you can get an advanced degree, get a job, and get sponsored via the employment route. That only takes 5-7 years.

Foreign students pay full-freight and subsidize domestic students, not the other way round.

How is the visa "undeserved" if they have a job offer from a willing employer?

Econ majors are people who do not really want to DO anything practical or helpful in their careers... also they lack the writing skills to be English majors, and lack the logic skills to be math majors.

The obvious fallback: economics. There are hordes of these people.

Now imagine: all these people are now STEM grads!! Quick everyone -- you are all Democrats anyway -- call up Al Gore and tell him you are yet-another "scientist" who believes the Global Warming hype!

I think you get a pin!

It is easier to earn a B.S. in mathematics at 98 percent of our schools (MIT, Caltech, and Harvey Mudd are the 3 exceptions I know of second-hand, that being said, not that many students there know much about the the new Peterson guide to moths of the southeast (hint - that is the best new science book of the year, not that the MIT kids, ambitious as they are, are going to buy that many copies of it)), with a shout out (in addition to the 3 named exceptions) to the kids who take the real math courses at Harvard --- than it is to graduate college with a real understanding of any of the great ancient languages of Western Civilization - Hebrew, Latin, Greek, and yes Anglo-Saxon, Middle English, Old Church Slavonic, Byzantine Greek, and my personal favorite, the real English language that was spoken not so long ago by my great-grandparents in their youth, when Tennyson was still a young pup and Dickens - Dickens! - still considered himself a "young man", with a future full of romance and love and eternal poetry ahead of him. Well two out of three ain't bad.

Four out of four of the New Testament Gospels are perfect: Luke has the best Greek, John has the greatest ability to speak to those who feel unloved, Mark was the best at reminding us what friendship is, for those of us who need reminding, and Matthew wrote every word with a heart full of love, and we all know what it is to hear words of love from someone who experienced, in years gone by, the dull sad repetition of day after day living life without the consolation of words of love. So, as to words, I will go with Matthew, but of course, words are only words: verba et alia, as they used to say, and most of what we do when we do what is right is alia, not verba.

God loves us all but loves us too much to let us stay that way (June Bug)

the golden rule - remember the first time you heard about it - never forget the first time you understood. Never never never violate that rule. Art is trash if you violate that rule, happiness is unobtainable if you violate that rule. The Ten Commandments are not a joke, not a single one of them. Remember who your real friends are if you are tempted to (1) violate the first commandment (2) violate the second commandment (3) violate the third commandment, and so on. Your best friend is God, God created all your other friends, with love in his heart. Remember that. I would like to say I remember, but usually I don't. Sad!

... said the guy who thinks Geoffrey Keynes, the Blake scholar, was the more interesting brother ....

"love" and "eternal poetry"

Compare any 5 or 6 chapters of Isaiah (that is, enough to last 10 minutes as a soliloquy --- imagine Ralph Richardson or Patricia Neal reading them, if you are my age, imagine someone younger - Leelee Sobieski? or Chris Pratt? reading them, if you are all that much younger than me) --- to any two acts of Hamlet (if you are the sort of person who likes to count, count the number of people Hamlet interacts with and choose either the two consecutive acts where Hamlet is talking less to others, or choose the two consecutive acts where Hamlet is talking more to others - yes, Shakespeare was a bright guy, but so are you, you can figure this out). I do not like to tell people, all though I do it all the time (much more in real life than on the internet, but in real life I make people laugh - you have seen guys like me on subway cars and on shifty streets and even in the airport, and you wondered why are people so happy -looking around that comical looking old dude, are they patronizing him?, no they are not), that there are rules to be followed. In real life, I am able to explain that the rules God sets are not really "rules" they are just "what we do when we care". Well we care when we know how much goodness has been sent our way, it is no small thing to be the first person to tell someone who thinks that he or she or she or he has never really been loved that, in fact, God loves them.

Comment sections are not real life. Look I don't think any less of you if you hate the idea of rules, or think I am some semi-schizophrenic ranter (i am no big fan of rules, qua rules, and as God is my witness I have never once said a word that was painful to a single one of my schizophrenic friends and their families. God bless you I hope you can say the same). Of course I do not want you to violate a single one of the commandments. But that is because I want you to know that once you realize how many gifts God has given to you, you no more want to violate any of the commandments (and yes this is 2018 and yes this is 2018 and yes I know what not violating commandments means - and sometimes it seems useless - why would you stop thinking your spouse is too unattractive for you, when she is, why would you stop thinking you can be lazy when you are healthy, when it seems like being a little lazy, in a deserved way, is just exactly the pastoral kind of happiness you were born for, why stop thinking that your parents, as ridiculously unlikeable as they are, deserve to be told by someone who knows how unlikeable they are that, in fact, they are failures, or why stop harboring justified resentments against all who have done you ill, but who, if you were to pray for them (excuse me if I get the English subjunctive tense wrong, it is easier in Latin) , will prosper and come to love the Lord more than they would if you do not (if you would not - sad!, when you think of it that way) - Vengeance is Mine, says the Lord - let the Lord take care of all that. But he does not want vengeance (Isaiah again, Shakespeare messed this up in the last 4 acts of Hamlet, read Isaiah it is like crossing the ocean, mercy and love swell like waves and when the ship settles into the troughs mercy and love is there too, take my word for it) He wants just a little more empathy from everybody, once He gets that He will be able to build on that. (Jericho, NY, 1977: I remember).

And yes, Isaiah and Shakespeare were both talented. Thanks for reading.

(Jamaica, NY, 1977: I remember). I may have misspoken there: Jamaica was the railroad station where my guardian angel rejoiced at my happiness that morning in 1977 (cor ad cor loquitur, if you were there you would know what I am talking about: one's heart rejoices, sometimes, being near people who are happy - think about it - believe me I could name them, I could tell you exactly what they looked like, I could tell you exactly what our conversations sounded like, even though that was 40 years ago - but I still miss them more than they would have missed me - but God loves them so much, and they know it, and God loves me almost as much, but ...); Jericho Turnpike was where that hardware store was, where God blessed, not for the first time, someone I asked him to bless. I get confused sometimes ... so many victories have been won so often, you have no idea, if you don't really care: and God knows there is no reason why you should. What you care about is hundreds of miles away from what I care about, at an average minimum.

I had a dream the other night where (to explain the dream, I have kept for 20 years an old telephone book - the white pages - from the county where I live, and have lived, for 20 years - and in the dream one of my pals challenged me, said hey I bet you that 50 times in a row you will open up a random page in that phone book and 50 times you will not have anything to say about the first person listed on that page - and in my dream I opened up one page after another and I explained to my friend the background and the concerns and the joys and the gifts of God of not just the first person on every page but every one on every page, and at the end of that very long dream (I was dehydrated and my heart, which is not a healthy heart, was moving slowly in my sleep) I said to my friend: this is all I wanted. To care. Nobody on this earth ever cared that much if I was happy or not. Before I was born I asked for that gift, because I could trade in that sacrifice - and then I woke up.

I have seen dogs rescued from the most horrible of lonely days in the shelters, full of barking gratitude at their new home: I have seen prisoners of war walk down the staircase erected at the exit of their homebound planes: I have seen smoky-faced survivors, blood still streaming from their wounds, slowly, as if in a dream where the worst almost happened but did not happen, walk away from disasters:

and I have seen the look in the eyes of a small creature that has never been loved before when it first understands that someone has showed up in its sad little life, and it will never again have to wonder what it would be like to be loved - because, for the first time, it knows. If you have ever seen that look you know what I am talking about.

Yes I have seen all these things and the best was the little creature who realized, for the first time, that it was loved.

Jamaica, 1977. I remember.

Thanks for reading.

and I have seen the look in the eyes of a small creature that has never been loved before - 4 dogs, 1 domestic cat. Not to mention a few crows feral cats and coyotes, and a few more wild animals. I may or may not be good at linear algebra but animals seem to like me.

"God loves us the way we are but loves us too much to let us stay that way"

"it is no small thing to be a friend to someone who never had a friend before"

it rains on the just and the unjust

That's a good post except that the first sentence is too long. "When in doubt, leave it out" - Strunk and White. And you are a bit harsh on unbelievers.

Thanks for the good advice. I remember the day after White died - I walked a couple times around a small pond at K.I. Sawyer Air Force Base, and watched the seasonal trees, who were so happy that they were trees, and beautiful, and I remember thinking: that was a guy who would have been a great guy to have as a friend! The trees were almost my friends that day, with the colors of their leaves, the charming way they politely agreed to bend in the winds of the season, the way that the tallest among them allowed the lake to reflect their beauty and the less tall proudly and affectionately lined the path around the lake - I am no pantheist but on a day when someone like EB White dies we are all a little pantheist, are we not, due to the empathy in every non-dessicated heart?

I often think that about people who write books that are not completely disheartening, sure I spend exponentially more time thinking about the sort of people who will never write a book , but bear with me here. .Sure you would not want most writers to hang out with your girlfriends (if you are in that very special time of life where you are old enough to have a romantic interest in that one person who also has a romantic interest in you , but not yet old enough to be too old for that - for me, that was about two months in my first 40 years) but they too, the good ones, and even the mediocre ones, often had moments where they just wanted someone to remember something they said, and maybe repeat whatever that was so someone else could hear. So you could trust them, in their best moments, and feel the empathy for them that you would feel for anyone, gifted with words or gifted with anything: or clumsy with words and not gifted with anything. If you have had kids you will remember how you thought about their future and probably understand.

St Thomas Aquinas liked to go on and on and on about how much better angels were at thinking than us, and at perceiving reality than us (us meaning humans, those who have a lot of life left (not me) and those with not many years in the future (me, and people like me)); how they understood difficult-to-us reasoning with instant perception, whereas, from Thomas's point of view, human only reasoned slowly: but as God is my witness, I think the angels often envy the way we look at one sad little tree on the side of Mulholland Boulevard and instantly wonder - is that tree similar, in looks and the windy attributes of the Mediterranean climate Los Angeles (la ciudad de la Madre de Dios y la Reina de los Angeles y el rio platero de Porciuncula) - is that tree not the spitting image (remember the episode in the Gospels where Jesus spit on his hands and touched the face of the person who wanted a miracle? I remember) of the tree that later, 30 or so years after Mary hastened by it and noticed it in its little crowd of fellow trees, grew up to be the tree that was felled for the cross: God bless its sylvan heart. I, no angel, thought that. Yes, in fact, you don't hear this often, but God remembers every little tree that ever grew in every single little woods that has ever existed on this earth or on any other earth, and every single one of those trees can tell you - maybe not today, but some day, this will be true - what it is to be loved by God. Yes, what I am saying is that trees will talk to you one day.

(was the last sentence too long, was the next-to-last sentence too long? maybe I used to throw back a few Manhattans, now and then, with Strunk, and if he were here, he would say yes, until I offered him a tequila to say no, and then, he would say No.)

I love unbelievers. I pray for thousands of them every day. And when God says to me would you like to go to heaven I will say yes but only if you let me bring in this huge crowd of unbelievers with me. Whatever it costs.
Maybe I am not such a good person and God will trick me and the crowd will be unbelieving cockroaches ( a very family friendly creature, by the way - you can look it up) or maybe God will thank me for making him laugh (I know as well as God knows that I have not suffered enough to save one soul and it is God that has suffered to save those huge crowds. I am not worried that they are unbelievers by dint of lack of knowledge. I am not worried that they are unbelievers because their parents were mediocre. Nothing worries me on those counts. Nada te turbe. You know what worries me? You can guess, and you probably will be right. )

In 1984, with four words, I made a young woman laugh with five words "a tree is a tree" - she later told me that she laughed at that, and after she laughed, she realized it was the first time she had laughed since her father had died, almost a year before.

That being said we can all improve our style, communication is built on our desire to communicate better.

In case she is reading - it was a Christian retreat - they let all of us speak to the rest of the people there, you did not have to be a good speaker to be allowed to speak - and I, who looked like a slightly less handsome version of Don Knotts, started my speech ( they were all friends, listening, and thought they knew what to expect) with these words "What is a tree?" Dramatic pause. " A tree is a tree." "God loves trees, every one of them, but God loves us more."

You had to be there. I didn't make googly eyes like Don Knotts, I paced it the way W.C. Fields or Charles Laughton would have paced it.

I know that, said this way, it does not sound funny: but, there is a lot more context than I can give here, and yes, if I have never done anything else in my life, I made that wonderful young woman laugh for the first time - the very first time- since her father passed away, months before that, while he was still young and she was still young. I have no doubt that she remembers. She is probably a grandmother now, and for all I know one of her kids plays on some team that people I admire root against (the Angels, the Padres, the Cardinals, the Blue Knights, the Golden Knights, maybe even the Saint Lucy Mets or the Salvadores! - Quien sabe?)

and don't rely on me for information on how much God loves you. Probably most people you have met have little information on that.
Find someone who does. It is not that I am admitting that I (in this persona which I take on, as all internet commenters seem to do, for just a few minutes a day) am just a clown - I am more than that - but God loves the average unbeliever more than He loves me, and, from the bottom of my heart, not much would make me happier than if you - reading these words right now - thought badly of me, whom you have never met, and simultaneously ( a good actress has the way to show the consecutive looks on her face in such a situation down cold) decided to start thinking well of someone who, you are certain, probably really does care about you --- and helps you understand what went on all those days before you were born. You know, those days when God was preparing a world for you with more love in his heart than the most loving parent who ever lived.

See? I am true to my cor ad cor loquitur approach.

and to which approach I remain loyal even as the comment threads pass into yesterday, and yesterday's yesterday.

Good times, my friend, good times, and thanks for reading! I have no fear of obscurity everyone I love has made their peace with obscurity as we wait for the future, wherein God's love becomes apparent. As for cockroaches, I have written much about cockroaches elsewhere (once or twice making the reader rather wish that I hadn't, while simultaneously glad that I had - all creatures are God's creatures, at their best, but still - cockroaches!): they are brave creatures, in their way, and they truly look out for each other, which is impressive, considering how small they are and how short their lives are. I have known a few to whom I have been kind who even, in return, looked out for me (these were larger members of the species), or who, at a minimum, were offended when I did not sufficiently quickly recognize their attempts at friendship. I kid you not!

You have no idea what a comfort it is to me, as I reach the last years of my life, to reflect that God loves every unbeliever as much as He loves me, or more - if you don't remember anything else I have ever said - and I have said a lot over the years - remember that. I remember, for what it is worth. Oremus invicem !!!

Economists want their profession to be considered a STEM field? Fine, except they need to learn how to apply the same level of rigor that fields like engineering, physics and math do. Simply using math to model your ideas is not the same thing as proving things from first principles.

I'm willing to give you guys a chance, but I'm very skeptical.

Piketty's "r - g" ?

We're talkin' rigor!

I don't quite get what the arbitrage is here, as opposed to outright deceit.

It would be nice if we could find such classroom seats for our Supreme Court Justices, all of whom are a bunch of humanities majors virtually unschooled in STEM. "Those who can, do; those who can't, judge.

Note that the three year difference

Note that the 3 year difference is not really about finding an employer that will sponsor, but about actually getting the visa: Two years ago the chances of getting one, even with a sponsor and a valid claim, were 1/3 due to lottery. Last year they were a bit easier, 40% (call it the Trump effect of getting people to not want to come). Either way, having a single year to try for an H1 or having to leave the country is quite the risky proposition compared to trying 3 years in a row.

For added fun, also note that this situation helps large employers that have foreign offices to keep candidates that fail to win the H1 lottery: If you can work for a place that will keep you in Canada until you win the H1, vs a small company that has no presence there, the preferences are clear.

Oh, and BTW Tyler, the form validation in the redesign throws away all data in case the email address is entered in the wrong field, or doesn't pass the (not great) validation. Your tech guy can do on-page validation, or at least make sure that the data will not get thrown away in Chrome.

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