Results for “alan krueger” 54 found
More rooftop-ready results on reservation wages
These are from Alan Krueger and Andreas Muller (pdf):
This paper presents findings from a survey of 6,025 unemployed workers who were interviewed every week for up to 24 weeks in the fall of 2009 and spring of 2010. Our main findings are: (1) the amount of time devoted to job search declines sharply over the spell of unemployment; (2) the self-reported reservation wage predicts whether a job offer is accepted or rejected; (3) the reservation wage is remarkably stable over the course of unemployment for most workers, with the notable exception of workers who are over age 50 and those who had nontrivial savings at the start of the study; (4) many workers who seek full-time work will accept a part-time job that offers a wage below their reservation wage; and (5) the amount of time devoted to job search and the reservation wage help predict early exits from Unemployment Insurance (UI).
Here is a popular summary of some of the results, including the recommended Figure 4.1 (p. 47 in the paper):
… today’s job seekers seem more picky. According to an analysis of surveys of 6,000 job seekers, the minimum wages that the unemployed are willing to accept are very close to their previous salary and drop little over time, says Mr. Mueller. That could help explain in part why they have so much trouble finding work, he says.
I conclude that some people aren’t very good at looking for jobs and further some people are not very good at accepting job offers.
This paper has many other excellent points and results, see for instance pp.27-29.
For the pointer I thank the excellent Andrew Sweeney.
More on the returns to education
First, apologies to Arnold, I missed his post when traveling and so he does discuss natural experiments, contrary to my previous claim about EconLog bloggers. That said, I’m not so happy with his analysis. He’s taking a few of the papers he sees as the weakest and he explains why they are weak. I would rather he dissects the strongest pieces and compares them to the strongest pieces, using natural experiments, showing very low rates of return to education. The Joshua Angrist papers (often with Alan Krueger) for instance are quite sophisticated and do not run afoul of Arnold’s objections. In works such as this (later versions seem to be gated), Angrist and Krueger perform exactly the natural experiment which Arnold requests and they find high (marginal) returns to education. Or see this piece by Card.
Here is Bryan’s response to my post. Focus on his #2, which is the crux of the matter:. He cites the signaling motives for education and concludes: “Here, the evidence Tyler cites is simply irrelevant.” This is simply not true and indeed these papers are obsessed with distinguishing learning effects from preexisting human capital differences. That is what these papers are, so to speak. In that context, “ability bias” in the estimates doesn’t seem to be very large, see for instance the Angrist or Card pieces linked to above. This paper surveys some of the “adjusting for ability bias” literature; it is considered quite “pessimistic” (allows for a good deal of signaling, in Caplan’s terminology) and still it finds a positive five percent a year real productivity gain from an extra year of schooling.
What’s striking about the work surveyed by Card is how many different methods are used and how consistent their results are. You can knock down any one of them (“are identical twins really identical?, etc.), but at the end of the day which are the pieces — using natural or field experiments — standing on the other side of the scale? The Card results are also consistent with theory, namely that models which emphasize signaling imply large unrealized gains from trade; it’s not that hard for an employer to administer an implicit IQ test as Google and Microsoft do all the time. As a separate (and here undocumented) point, I would argue the Angrist and Card results are consistent with the bulk of results from sociological and anthropological investigations.
There really does seem to be a professional consensus. Maybe it’s wrong, and/or dominated by biased pro-education specialists, but I’m not seeing very strong arguments against it. For the time being at least, I don’t see that there is much anywhere else to go with one’s beliefs. If Arnold or Bryan (or David) suggests a good paper with a natural experiment showing a low marginal ROR for education, I am happy to read the paper and report back and compare it to the preponderance of evidence on the other side.
The real puzzle is how large measured marginal returns to education are consistent with the continuing observed failures of the American educational system. Why does the low-hanging fruit persist or is it low-hanging at all? The traditional liberal view is that further educational subsidies are needed, but a possible alternative is that some people simply do not wish to step across to the other side of the divide to a “better life,” at least as defined by middle class values and income statistics. Or is there some other hypothesis? Whichever way you cut it, a big improvement in this area does not seem about to happen and arguably we are moving in the opposite direction. Whatever gains are there “in the data,” we don’t seem able or willing to capture them.
What is the state employee union wage premium?
How much does collective bargaining matter? On Twitter, Will Wilkinson asks for data. I find this web site specifying the average Virginia state employee to be earning $50,298. Rortybomb says that for Wisconsin the comparable number is $48,267.
Yet Wisconsin had collective bargaining for state employees and Virginia does not. Of course this comparison is a gross one and it is not holding constant the composition of each work force, seniority, cost of living differences, and it also does not seem to pick up possible differences in benefits. Furthermore it does not consider the 48 other states. Yet, crude as this one-to-one comparison may be, it is more empirically sophisticated than most (all?) other discussions I have seen.
This David Blanchflower and Alex Bryson paper (see pp.9-10), using 1980s data, finds a union wage premium, for state employees, of 14.5 percent, with the premium being strongest for unskilled workers, as is the case in the private sector as well. (NB: I am not sure if they are adjusting for differential benefits but I think not.) Alan Krueger tells us that the union/non-union wage gap is smaller in the public sector than in the private sector ("overwhelming evidence").
I'm not pushing any particular answer, I'd just like to put the question on the table. What else do you all know?
Addendum: from Adam Ozimek: "The regression coefficients on page 8 of the report show that the union wage premium is between 15% to 16%, while the public sector wage discount is around 11%, meaning unionized public sector employees are paid 4% to 5% wage premium." Adam also provides further references and discussion.
Assorted links
Facts about occupational licensing
We find that in 2006, 29 percent of the workforce was required to hold
an occupational license from a government agency, which is a higher
percentage than that found in studies that rely on state-level
occupational licensing data.
That is from a new paper by Morris Kleiner and Alan Krueger. I am happy to see such respected economists turning their attention to a neglected issue. Here is a non-gated version of the paper.
There is, by the way, an interesting sentence buried near the end of the paper:
In contrast, union members perceive themselves as less competent than other workers.
Portrait of Nouriel Roubini
Find it here, he is called "Dr. Doom." Paul Krugman interprets. Nouriel was one member of a stellar Harvard Ph.d. class, including also Abhijit Banerjee and Alan Krueger, among others.
Happiness advice from my wife
My wife, a PhD microbiologist, told me once that when she was at work she felt guilty about not being at home with the kids and when she was at home with the kids she felt guilty about not being at work.
This problem may explain a surprising finding from Betsey Stevenson and one of your leading candidates for "most wanted economist blogger," Justin Wolfers. Stevenson and Wolfers have a new paper showing that happiness is up for men but down for women. They write:
By most objective measures the lives of women in the United States have improved over the
past 35 years, yet we show that measures of subjective well-being indicate that women’s happiness
has declined both absolutely and relative to male happiness. The paradox of women’s declining
relative well-being is found examining multiple countries, datasets, and measures of subjective wellbeing,
and is pervasive across demographic groups. Relative declines in female happiness have eroded
a gender gap in happiness in which women in the 1970s typically reported higher subjective wellbeing
than did men. These declines have continued and a new gender gap is emerging–one with
higher subjective well-being for men.
One reason is suggested by Stevenson in a NYTimes article on her research with Wolfers and similar independent research from Alan Krueger.
Ms. Stevenson was recently having drinks with a business school
graduate who came up with a nice way of summarizing the problem. Her
mother’s goals in life, the student said, were to have a beautiful
garden, a well-kept house and well-adjusted children who did well in
school. “I sort of want all those things, too,” the student said, as
Ms. Stevenson recalled, “but I also want to have a great career and
have an impact on the broader world.”
Opportunity brings opportunity cost.
In the NYTimes article David Leonhardt correctly notes that "Although women have flooded into the work force, American society hasn’t fully come to grips with the change." Alas, all he has to offer as solution is the usual platitudes about subsidized daycare and how men should do more of the housework – peculiar solutions to women’s unhappiness with increased opportunities. Leonhardt should instead have talked to my wife.
As I wrote this post, I asked my wife about her feeling guilty at home and at work but she told me she no longer feels this way. "Really?" I asked, "Why not?"
"I decided to act more like a man and get over it," she responded.
What Makes a Terrorist?
This new book by Alan Krueger, full of first-rate empirical work, punctures many myths about terrorism. For instance poverty does not breed terrorism, once you look at the data. Here is the book’s home page.
My only complaint is that the book does not deliver on its title; it tells me what doesn’t make a terrorist, but I still don’t know what does make a terrorist. (Don’t even mention Islam in the comments unless you have something new — and analytical — to say; citing the Koran on jihad isn’t going to solve the puzzle.)
My crude view sees terrorism as meshed with three factors:
1. The belief that it is justified to kill innocent people for sufficiently important political ends. Of course people who support the fighting of WWII hold this view too.
2. False positive beliefs about how the world works. Osama bin Laden probably doesn’t know the Alchian and Allen theorem, the make-work fallacy, the Heckscher-Ohlin results, nor does he realize that his Islamic Caliphate would not work very well.
3. Some third factor(s), rooted in human psychology.
Most non-terrorists have more of #1 and #2 than is good for the world. And I expect that terrorists have a special excess of #1 and #2. I nonetheless think that the third factor is the key to understanding "what makes a terrorist." You could start your reading here, and here, good luck. Is it "narcissistic rage"? Authoritarian or submissive personality types? Freudian mumbo-jumbo at work?
By the way, the difficulty of pinning down the third factor(s) has policy implications. We should adopt policies which are robust toward not understanding the strategies or game-theoretic solution concepts of the terrorists. Complicated signals are unlikely to communicate the appropriate information in practice. However bad is our model of the terrorists, I suspect that their model of us is even worse.
Joshua Angrist writes to TNR on Levitt
In "Freaks and Geeks" (April 2, 2007) Noam Scheiber praises my work with Alan Krueger on the economic effects of compulsory schooling but argues that economics Ph.D. students today are obsessed with headline-grabbing trivia of little substantive importance. The root cause is said to be excessive attention to a good or clever research design at the expense of the relevance of the underlying question. Scheiber’s story is engaging and he lands a few punches, but his account is misleading in two important ways. For one thing, he exaggerates the problem of small-bore studies. America’s half-dozen top Ph.D. programs produce scores of Ph.D. students every year. Most of this work is still on traditional topics. At MIT (where Levitt studied), we continue to supervise empirical theses on, among other things, health insurance, immigration, unions, and human capital. High-quality research on these traditional topics gets students high-quality jobs. I’ll plead guilty, however, to being especially pleased when students manage to come up with clean identification–that is, they have a convincing strategy for uncovering causal effects. Clean identification is not a fetish; without it, little of value is learned. On this score, our students typically do better than the empiricists of H.G. Lewis’s generation. In two of the most dynamic empirical microeconomics subfields, the economics of education and economic development, there has been a virtual credibility revolution, with the increase of randomized field trials as well as compelling natural-experiments research designs (see, e.g., the work done at MIT’s Poverty Action Lab).
Second, in his rush to tar some up-and-comers with the "cute-o-nomics" brush, Scheiber misses a central feature of the clean-identification research agenda, best explained by example. One of the enduring scientific and policy questions in Labor economics is the sensitivity of hours worked to changes in pay (this matters for tax policy, for example). The best evidence labor economists have on the relation between wages and hours worked comes from a small experiment (by Ernst Fehr and Lorenz Goette) involving the wages of bicycle messengers in Switzerland. The second best comes from a study of stadium vendors by Gerald Oettinger. Who cares about the riders of Veloblitz or snack sellers at Camden Yards? We care because economics is predicated on the notion that a few simple principles explain behavior in many settings. These studies produce results that are convincing and may well be general, though, as always in science, it will take replication to know for sure. Some of the studies Scheiber dismisses can be understood in this spirit. Finally, as to the merits of Freakonomics the book: My 17-year old daughter picked it up on her own last year. She never knew economics could be so cool. Even better, she now asks me what I’m up to. So I tip my cap to Dubner and Levitt–I hope to see many of their readers in an economics classroom some day.
JOSHUA ANGRIST is a professor of economics at Massachusetts Institute
That is from TNR on-line. Here is Alex’s earlier post on the Scheiber piece.
Does graduate school performance predict job placement?
For economists, that is. A superstar team of co-authors — Susan Athey, Larry Katz, Alan Krueger, Steve Levitt, and Jim Poterba — writes:
…students’ grades in required core courses are highly correlated across subjects. The Ph.D. admissions committee’s evaluation of a student predicts first-year grades and Ph.D. completion, but not job placement. First-year performance is a strong predictor of Ph.D. completion. Most importantly, we find that first-year Micro and Macro grades are statistically significant predictors of student job placement, even conditional on Ph.D. completion. Conditional on first-year grades, GRE scores, foreign citizenship, sex, and having a prior Masters degree do not predict job placement. Students who attended elite undergraduate universities and liberal arts colleges are more likely to be placed in top ranked academic jobs.
Here is the paper. This bit comes at the end:
Our results raise an interesting question: Why are some characteristics much stronger predictors of grades than of job placements? Foreign-trained and male students achieve substantially higher first-year grades, on average, but do not appear to be placed into much higher ranked jobs.
In my time, twenty years ago, foreign-trained students are more likely to have already seen the core material. It may also be that many elite, non-U.S. educational systems are better geared toward producing good grades than producing independent researchers.
Rockonomics
"Early on in the entertainment industry, it’s in the interest of the business to think of themselves as throwing a party, not selling a product. I think they attract more of a following that way," he said.
"But over time, the industry takes more the form of a market and is driven by market forces. The Superbowl initially felt like it was rewarding its fans. But then it becomes established and the League finds it in its interest to push up prices."
That is Alan Krueger, from this BBC article on his work on the economics of rock music. Hat tip to EconBall blog.
Do we need occupational licensing?
Alan Krueger writes:
In a new book, "Licensing Occupations: Ensuring Quality or Restricting
Competition?" (Upjohn Institute, 2006), Morris M. Kleiner, an economist
at the University of Minnesota, questions whether occupational
licensing has gone too far. He provides much evidence that the balance
of occupational licensing has shifted away from protecting consumers
and toward limiting the supply of workers in various professions. A
result is that services provided by licensed workers are more expensive
than necessary and that quality is not noticeably affected.
Read more here. I can’t yet find this listed on Amazon.com, any pointers? Here is a pdf of part of the book. Here is a home page for the book.
Academic rent-seeking and direct appropriations
According to The Chronicle of Higher Education, there were 1,964 earmarks to 716 academic institutions costing a total of $2 billion in the 2003 fiscal year, or just over 10 percent of the federal money spent on academic research. From 1996 to 2003, the amount spent on academic earmarks grew at an astounding rate of 31 percent a year, after adjusting for inflation…
As academic earmarks have grown, so have universities’ lobbying expenditures. Spending on lobbying jumped to $62 million in 2003 from $23 million in 1998, according to The Chronicle of Higher Education.
A study by John M. de Figueiredo of the University of California, Los Angeles and Brian S. Silverman of the University of Toronto, which will soon be published in The Journal of Law and Economics, finds that universities receive a high return on their lobbying dollars. The researchers related the amount each university received in earmarks to its lobbying expenditures from 1997 to 1999, and other factors.
Professors de Figueiredo and Silverman found that a $1 increase in lobbying expenditures is associated with a $1.56 increase in earmarks for universities in districts that do not have a senator or congressman on the crucial Appropriations Committees, and more than a $4.50 gain in earmarks for universities with a representative on one of the Appropriations Committees.
Even among universities that do not lobby, those that have a congressman or senator on the Appropriations Committees tend to be awarded more earmarked funds.
A university’s fortunes also tend to rise or fall when senators from its state join or exit the Appropriations Committee. For example, the year after Senator Lauch Faircloth of North Carolina, a member of the committee, was defeated by John Edwards, who did not become a member, earmarks to universities in North Carolina fell by half.
But alas, all this money does not seem to pay off in terms of quality:
…a university’s academic standing, as measured by the National Academy of Science’s ranking of departments, is not related to the amount of earmarked funds it receives.
A. Abigail Payne, an economist at McMaster University in Canada, has studied how earmarks affect the quantity and quality of academic research, inferring quality from the number of times research studies are cited by subsequent studies. She concludes that "earmarked funding may increase the quantity of publications but decrease the quality of the publications and the performance of earmarked funding is lower than that from using peer-reviewed funding."
Indications are that academic earmarks crowd out spending on competitive peer-reviewed grants, at least in the short run.
Alan Krueger offers more. Here is a very early version of the first cited paper.
How good was your day?
The researchers [Norbert Schwartz, Daniel Kahneman, Alan Krueger, David Schkade, and Arthur Stone] assessed how people felt during 28 types of activities and found that intimate relations were the most enjoyable, while commuting was the least enjoyable.
More surprisingly, taking care of their children was also among the less enjoyable activities, although people generally report that their children are the greatest source of joy in their lives…
In addition to intimate relations, socializing, relaxing, praying or meditating, eating, exercising, and watching TV were among the most enjoyable activities. Commuting was the least enjoyable activity, with working, doing housework, using the computer for e-mail or Internet, and taking care of children rounding out the bottom of the list.
Interactions with friends and relatives were rated as the most enjoyable, followed by activities with spouses or significant others, children, clients or customers, co-workers and bosses. At the bottom of the list: activities done alone.
…"When people are asked how much they enjoy spending time with their kids they think of all the nice things—reading them a story, going to the zoo," said University of Michigan psychologist Norbert Schwarz, a co-author of the Science article. "But they don’t take the other times into account, the times when they are trying to do something else and find the kids distracting. When we sample all the times that parents spend with their children, the picture is less positive than parents expect. On the other hand, we also find that people enjoy spending time with their relatives much more than they usually assume."
General reports of what people enjoy may also differ from descriptions of how people actually feel in a specific situation because many people hesitate to report socially inappropriate feelings. This is less of a problem when they report on specific episodes. "Saying that you generally don’t enjoy spending time with your kids is terrible," Schwarz said, "but admitting that they were a pain last night is quite acceptable." The new Day Reconstruction Method provides a better picture of people’s daily experiences by improving accurate recall of how they felt in specific situations…
…general life circumstances—such as how secure people think their jobs are, or whether they are single or married—had a relatively small impact on their feelings throughout the day. These factors were closely linked with how satisfied people said they were with their lives in general, but had little influence on how positive they felt during specific activities.
"It’s not that life circumstances are irrelevant to well-being," notes Schwarz. "On the contrary, we found that people experience large variations in feelings during the course of a normal day. This variation highlights the importance of optimizing the allocation of time across situations and activities. If you want to improve your well-being, make sure that you allocate your time wisely."
Unfortunately, that’s not easy. When the researchers examined the amount of time spent on various activities, they found that people spent the bulk of their waking time—11.5 hours—engaged in the activities they enjoyed the least: work, housework and commuting.
Here is the full story, with thanks to the ever-excellent www.politicaltheory.info. Here is more information, and it seems you can order the study here.
What Gets Out the Vote?
Alan Krueger writes:
Door-to-door canvassing, though expensive, yields the most votes. As a rule of thumb, one additional vote is cast from each 14 people contacted. That works out to somewhere between $7 and $19 a vote, depending on the pay of canvassers – not much different from the cost of that three-pack of underwear. Canvassers who matched the ethnic profile of their assigned neighborhoods were more successful.
The effect of leaflets on turnout has not been evaluated as thoroughly as canvassing, but results from two partisan campaigns indicate that one vote was generated for every 66 leaflets hung on doors. In another experiment, just one vote was added for every 200 nonpartisan leaflets. Over all, leafletting costs $14 to $42 a vote. (A salutary aspect of the book is that one, two or three stars are placed next to the central findings to signify the degree of confidence the authors have in the results. This is only a one-star result.)
Direct mail is less cost-effective than leaflets. Mailing costs totaled around $60 for each additional vote cast. Telephone calling is also not highly effective, with the cost per vote ranging from $200 for heavily scripted calls to $45 for more personalized calls. Even worse, recorded messages and e-mail had no detectable impact on turnout.
Some candidates mail negative messages to their opponent’s supporters to discourage voting. Mailing a negative message depresses votes, but at a very low rate. The cost per vote diminished was about $300. (This is another one-star finding.)
Here is The New York Times link. The results are drawn from this Brookings book.