Category: Education

We know the paradox.  Education improves earnings but most formal schooling appears to be a waste of time.  Many economists claim that education is mostly a means of signaling quality.

I view education as a self-commitment to being a more productive kind of person.  Education is about self-acculturation.

Men are born beasts.  But education gives you a peer group, a self-image, and some skills as well.  Getting an education is like becoming a Marine.  Men need to be made into Marines.  By choosing many years of education, you are telling yourself that you stand on one side of the social divide.  The education itself drums that truth into you.

Similarly, if you become a Mormon or a Protestant in Central America, your life prospects go up.  It is not that Mormons have learned so much more, but rather they have a different sense of self.  They have a positive self-image about their destiny in life and choose a different set of peers.  They also choose not to drink. 

The beasts model differs from classic signaling theory.  If education is pure signaling, just give everyone a standardized test in seventh grade and then close up the schools.  But the process of self-image formation, at least for most people, is far from complete at that point. 

That being said, education will look like what the signaling model predicts.  It will be about subtle brainwashing, image, and learning markers of status.  What the signaling model misses is how important those features are for your subsequent productivity.

Nerds will hate education and tend to embrace the signaling model.  Their sense of self is often formed quite early, and they do not why so much time should be wasted in school.  This is one reason why the signaling model is so popular in economics.

Part of the East Asian growth miracle was that so many citizens bought into the self-acculturation model and imposed it on their children.

So how much acculturation do you need? 

If you move from Myanmar to America at age seven, you probably grow up as an American.  Age thirteen, you probably grow up as an American.  Age eighteen, it is harder to say.  If you move at age twenty-five, you probably stay fairly Burmese.  So your identity is shaped by what you are doing, and your peers, between the critical ages of thirteen to your early twenties.  Those are precisely the years covered by our educational system.

Of course apprenticeships can turn beasts into men, but apprenticeships also turn them into working-class men.  You spend your childhood hanging out with other laborers.  As society becomes wealthier, more parents are willing to spend on education rather than apprenticeships.

Comments are open.  I am especially interested in how such a theory might be tested, and what it implies for the optimal content of education.

Worth reading, no matter what your age, but especially if today is your 44th birthday.

Neighborhoods and Academic Achievement: Results from the Moving to Opportunity Experiment

Families originally living in public housing were assigned housing vouchers by lottery, encouraging moves to neighborhoods with lower poverty rates. Although we had hypothesized that reading and math test scores would be higher among children in families offered vouchers (with larger effects among younger children), the results show no significant effects on test scores for any age group among over 5000 children ages 6 to 20 in 2002 who were assessed four to seven years after randomization. Program impacts on school environments were considerably smaller than impacts on neighborhoods, suggesting that achievement-related benefits from improved neighborhood environments are alone small.

Here is the paper, and thanks to Sven Wilson for the pointer.

Phone issues from the Arlington campus have been temporarily resolved.
Verizon continues to work on the problem. The temporary resolution will stay
in place until Verizon permanently resolves the problem.

Should you have any questions regarding this problem, call Doris Rollins at
3-3470.

I thank Norm Geras for this interview.  A few excerpts:

What, if anything, do you worry about? > I worry about the worrying of my wife.

If you had to change your first name, what would you change it to?
> I would change my name to ‘Cowen Tyler’, which is what many
foreigners call me anyway.

Who are your sporting heroes? > Darrell Walker, former point guard for the Washington Bullets.

Do check out Norm’s main blog.  My favorite all-time blogger is, of course, Alex; I asked Norm to add this to my previous answer.

Here is some wisdom for the new year to come:

Other days are eaten up by errands. And I know it’s usually my fault: I let errands eat up the day, to avoid facing some hard problem.

The most dangerous form of procrastination is unacknowledged type-B procrastination, because it doesn’t feel like procrastination. You’re "getting things done." Just the wrong things.

Any advice about procrastination that concentrates on crossing things off your to-do list is not only incomplete, but positively misleading, if it doesn’t consider the possibility that the to-do list is itself a form of type-B procrastination. In fact, possibility is too weak a word. Nearly everyone’s is. Unless you’re working on the biggest things you could be working on, you’re type-B procrastinating, no matter how much you’re getting done.

In his famous essay You and Your Research (which I recommend to anyone ambitious, no matter what they’re working on), Richard Hamming suggests that you ask yourself three questions:

1. What are the most important problems in your field?
2. Are you working on one of them?
3. Why not?

Here is the full argument.  Addendum: Here is the correct link for "You and Your Research."

1. The pessimists commonly argue that the large U.S. trade and budget deficits eventually will require a big fall in the dollar, higher real interest rates, and a general loss of confidence in dollar-denominated assets. We all know that g > r would stop this problem in its tracks. But let us say that g is not big enough relative to r. What other non-pessimistic scenarios can you outline? How valid are they?

2. What is the difference between covered and uncovered interest parity? Which are assumed by the traditional Dornbusch model of exchange rate overshooting? None, just one, or both? How do the observed failures of the expectations theory of the term structure affect the Dornbusch model? 

3. How will the aging baby boom generation affect the following and why? Savings rates, interest rates (real, nominal, short and long term), Fed policy, inflation, and investment.

4. Targeting nominal gdp involves targeting M x V, or Money times Velocity. Do open economy considerations make this a better or worse idea? Make sure your assumptions are clearly stated.

5. Write your own exam question and answer it, do not use open economy macro as your major topic since three of the questions already cover that. The quality of the question matters as much as the quality of the answer.

Some people did very well.  #2 and #4 gave people the biggest problems.

Inspired by yesterday’s snowflake photograph, Steve Horowitz pens an excellent post on spontaneous orders in the natural and social worlds.  At our best social scientists inspire an "aesthetic appreciation of, and deep desire to understand, the
awesome beauty and complexity of the undesigned order of ‘social
snowflakes.’"  Do read the whole thing.

I cannot believe that I have gone my entire life without knowing how to fold a shirt.  Check out the video.  Seriously.

Thanks to Ted Blog for pointer.

Jane Galt has a good list of suggestions, yet I don’t follow them all.  When it comes to "don’t eat out" I receive an F minus.

Arguably I have excess self-discipline, rather than the opposite problem.  That means I will try to rationalize this spending, rather than apologizing for it.

I view dying young as an enormous tragedy.  It would be so, so, so, bad.  As the economist would say, it would not equate marginal utilities of money across different world-states.  It is also very hard to insure against premature death.  The life insurance payment would help my family but it doesn’t go to poor, lil’ dead ol’ me.

Given the imperfection of post-death markets, what else can I do?  Er…I can spend money now.  If I die soon, I had bigger kicks today.  That is a kind of partial compensation for the tragedy; admittedly I run a greater risk of outliving my remaining savings.  (Quick micro quiz: Do bloggers, by offering free fun outputs, raise or lower the savings rate?) 

Can we find a testable prediction?  Religious people should save a greater fraction of their incomes.

I don’t hold the view that religious people should be indifferent to death; presumably they think they are on earth to fulfill God’s plan.  But they should have fewer purely selfish reasons to fear death.  (Good religious people, that is, or at least those who think they are good.)  A weaker selfish fear of death means less need to buy insurance against premature death.  The devout should spend less money now.

Last night we ate at Zengo’s — Latin-Asian fusion — which was excellent.  Get the hamachi, the empanadas, the ribs, and the arepas.

MR reader Jeffrey Drucker writes:

I’ll be graduating college in just a few weeks and entering the real world.  That is I’ll be a salaried employee making all budgetary decisions for myself.  Aside from the necessary components of spending, saving, and repaying my college loans I’d like to set a portion of my earnings aside for charitable donation.  I’ve always thought that charity was a crucial element of any caring libertarian’s mindset.  Now that I will be able to spend my own money, I wondered if you could provide any insight into the economic considerations of charity.

Obviously, the decision to donate is based on personal considerations and evaluations of the relative merit of different organizations.  But economically is it more sensible to donate to a wide number of worthy causes or champion just one.  Should I focus on issues closer to home or those who are in the most need the world over?  How large a percentage of my income is it reasonable to donate, what issues should I consider (value of investment opportunities, lifetime consumption)?

Putting political and intellectual non-profits aside, here are some principles for purely charitable giving: 

1. Published information on budget ratios devoted to programs and fundraising expenses is not reliable.  Many charities manipulate the data.

2. Consider neglected but long-simmering problems; read my earlier analysis of whether you should focus on the crisis of the day.

3. Hardly anyone gives enough to charity and you won’t either.  Pick a cause or causes you will become addicted to.  Tell others you won’t back down from your cause, so that you will lose face if you do.

4. My preferred approach is pure cash transfers to rural Mexicans, vis-a-vis Western Union.  You don’t get the tax break but administrative expenses are very low.  Think of Western Union as a for-profit charity.

5. In-kind aid sounds inefficient to the economist, but the commitment may make you happier.  You are wasting most of your time anyway.

6. Don’t give money to beggars, the explanation is here.

The comments are open for other suggestions.  Analytical principles are especially welcome.

The students themselves are to write the questions into the comments section.  Do it soon, and yes that means you.  Then the students should practice these questions in their spare time, with the clock ticking.  Ideally each question, or at least some of them, should come as a surprise.  Don’t read them all until you are ready to give them a try.

Most people study to make themselves feel better about doing their work, and not to actually succeed in their chosen field of study.  They spend hours staring blankly at sheets of paper.  They should spend more time trying to solve problems or answer questions, usually under simulated exam conditions and with a clock ticking. 

Tick, tick, tick…That’s the way to go, and yes I know it hurts.

We should have more debates like this.