Academia, and economics in particular, is becoming too elite

by  Tyler Cowen

In 1970, just 1 in 5 U.S.-born PhD graduates in economics had a parent with a graduate degree. Now? Two-thirds of them do, according to a new analysis from the Peterson Institute for International Economics. The trends are similar for other fields (and for foreign-born students), but economics is off the charts.

This partly reflects population trends: Over that same period, the share of parents with graduate degrees and college-age children rose 10 percentage points, to 14 percent, our analysis of Census Bureau data shows. But compared with the typical American, a typical new economist is about five times more likely to have a parent with a graduate degree.

The new analysis comes from Anna Stansbury of the Massachusetts Institute of Technology and University of Michigan graduate student Robert Schultz, who got their hands on detailed data on U.S. PhD recipients going back more than 50 years. The data includes extensive information about almost half a million recipients in the 2010-to-2018 period alone.

It shows that the elite dominate even more among the top schools that produce about half of all future economics professors. Among the top 15 programs, 78 percent of new PhDs since 2010 had a parent with a graduate degree while just 6 percent are first-generation college students.

Here is the full story, via Daniel Lippman.

Operation Warp Speed Should Not have Been Disbanded

by  Alex Tabarrok in

Operation Warp Speed produced a new vaccine for a novel virus in record time but when Operation Warp Speed was disbanded by the Biden administration, vaccine research and development slowed from warp speed to impulse power. It’s ridiculous that it is taking longer to develop and deploy tweaks to the mRNA vaccines to deal with new variants than it took to develop the original vaccines from scratch. By the time we get an Omicron-specific vaccine that variant will have disappeared. This is no way to run a civilization.

We should be investing in a universal vaccine for all sarbecoviruses (of which SARS-COV-II is a member) and, as I have long argued (and here) a nasal vaccine. We need not exaggerate, for the vaccinated the dangers are no longer acute, but we should be better prepared for future variants and the savings from less sickness alone easily trump the costs. Indeed, the issue isn’t even so much the cost as the need to coordinate regulatory agencies, as OWS did, to speed approvals and reduce bureaucracy.

Patrick Collison, writing at Slow Boring, has the details (as Tyler also noted):

Despite excellent technology and promising early results in animal models, we estimate that the very earliest we will have access to these vaccines in humans is 2024. These groups need to run primate trials, then run human clinical trials, and then ramp manufacturing and distribution. Beyond having to jump through a lot of hoops, we’ve observed that they’re frequently tripped up by stupid things outside of their control, any one of which may hold their work back by months. (One group’s monkeys have been delayed by US Customs, which will push the start of their primate trial back ‘till September. Another is struggling to obtain necessary adjuvants. Multiple groups are unable to get access to current mRNA vaccines for research purposes because of legal barriers.) All groups we’ve interacted with are underfunded compared to what would be ideal.

Broadly speaking, the holdups involve some combination of logistical challenges and regulatory requirements, and the intersection between both. (You don’t in principle have to run a primate trial, but the FDA makes it harder to run a human trial if you don’t. You don’t in principle need to use “acute infection” as a trial endpoint; you could also use neutralizing antibody titers, which would be much faster and simpler.)

To speed things up:

  • We should lower the barrier for human clinical trials and use simpler endpoints. For many vaccine candidates, we could run human trials concurrent with primate trials (once basic safety data has been obtained). In humans, we don’t need to repeat Phase I trials for platforms that have already been validated and derisked. (In this vein, the FDA’s recent announcement about not requiring trials for updated platforms was encouraging.)
  • We should help these groups to scale manufacturing faster. Operation Warp Speed itself cost $10 billion; a second incarnation, with a tenth of that budget, could almost certainly accomplish a great deal.

…In our view it is probably true that, with competent execution, we could roll out pan-variant COVID vaccines before the end of 2022. Actually making that happen would require significant and coordinated logistical, regulatory, and administrative action. However, it would by no means be impossible. Not having pan-variant vaccines in 2022 is best thought of as a choice.

*Adventure Capitalism*

by  Tyler Cowen in

The author is Raymond B. Craib and the subtitle is A History of Libertarian Exit, from the Era of Decolonization to the Digital Age.  This is really two books in one.  The first is a quite useful and well-researched history of various libertarian attempts to ease the costs of political exit, or sometimes to obtain exit altogether.  He is well-informed about the 1972 Michael Oliver attempt to set up the libertarian “Isle of Minerva,” nearby to Tonga.  The King of Tonga nixed it, but even Rothbard and Tuccille mocked it.  And remember Jimmy Stevens and the Phoenix Foundation and their plans near New Caledonia?  This stuff was never the libertarian mainstream, or close to it, but it dominates this book (that said it is a fascinating story and well-researched).

Nonetheless these odd goings-on are treated as “the history of libertarian exit” when in fact plenty of other plans were afoot, how about say free movement within the European Union? The dismantling of capital controls?  Fighting to have the Berlin Wall come down?

The narrative then continues through seasteading, charter cities, Balaji, and so on.

The second book contained herein is simply a use of smear terms and sneering, Nancy MacLean style, to indicate that these various ventures are bad, playthings of the evil wealthy, anti-democratic, even loose affiliates of these ventures were bad people, and so on.  Usually there is not even an argument, rather it is assumed that somehow the reader is on board with an anti-exit perspective.  In this regard the author is simply a defective thinker.

I’ll leave the final evaluation up to you.

Patrick Collison on vaccines

by  Tyler Cowen in

Pan-variant vaccines are a $1 trillion dollar bill on the sidewalk. Some combination of a lack of basic institutional seriousness and self-imposed straightjackets mean that we will probably get these vaccines much later (perhaps years later) than we otherwise could. It is intellectually internally consistent to believe that COVID doesn’t matter and that we consequently shouldn’t care about any of this. But it is not consistent to think that COVID matters and that this situation is anything other than crazy.

Here is the full piece, written for Slow Boring (which you should subscribe to and pay for, as I do), excellent throughout.  One lesson is that management really matters, public sector management most of all for a case like this.

How bad is the new German trade deficit?

by  Tyler Cowen in

That is the topic of my latest Bloomberg column.  The country suddenly faces many problems at once:

…extremely high energy prices, the need to bail out some of its energy firms, the conflict in Ukraine and the resulting promise to boost defense spending, and possible troubles with Italy in the Eurozone over rising borrowing costs. Germany is either going to do very, very poorly, or will muddle through and manage a major turnaround. I would bet on the latter.

And here is another part of the argument:

And then there is what may be Germany’s biggest problem: complacency. In the last 20 years Germany’s primary education system has had a mixed performance, albeit with some improvements, and its infrastructure is no longer perceived as so efficient or high quality. Yet reform was not imperative, partly because things were going OK enough in Germany.

There is a chance that the current crisis will jolt Germany out of its passivity. Throughout history Germany has managed to reverse some very bad situations, as it did after the devastations of the Napoleonic wars and World War II.

Keep in mind that human capital is the most important determinant of national wealth, much more important than the flows reflected in the trade account in any given month or year. If German reforms boost the ability of the country to train students and to put its people to work, the long-run payoffs could be very high.

In general I have found that wealthy societies deal with “one-off” problems somewhat better than most observers expect in advance.  I will be watching closely.

The Destruction of the Georgia Guidestones and the Bamiyan Buddhas

by  Alex Tabarrok in

I am saddened and disturbed by the destruction of the Georgia Guidestones. The Guidestones, “America’s stonehenge,” were a set of six large, granite slabs, erected in 1980 and paid for by a mysterious group of unknown benefactors. The slabs were arranged precisely for astronomical reasons and contain inscriptions in multiple languages. On July 6, 2022 the Guidestones were blown up and then, what remained, was completely destroyed for apparent safety reasons.

The Guidestones were not a significant marker of cultural heritage, unlike the 1400 year old massive Buddhas of Bamiyan which were destroyed by the Taliban in 2001. Nevertheless, it is hard not to see the parallels between the destruction of the Guidestones and the Bamiyan Buddhas. Earlier this year Kandiss Taylor, a minor candidate for the 2022 Republican nomination for Governor of Georgia, made the destruction of the Guidestones one of her campaign pledges, claiming they were a Satanic evil. Thus, the destruction of the Guidestones was likely motivated by fears and hatred similar to those that motivated the destruction of the Buddhas. At the very least, an interesting art work, created at considerably expense by a group of public benefactors, was maliciously destroyed.

The Guidestones were meant to last for a thousand years and to offer guidance to humanity after a castrophe such as a nuclear war. The Guidestones lasted 42 years. It doesn’t bode well.

Georgia Guidestones in Elbert County, GA.jpg
The Georgia Guidestones, Quentin Melson, Wikipedia.

Illegal markets in everything

by  Tyler Cowen

The operator of a Colorado funeral home who was accused of stealing body parts and selling them to medical and scientific buyers, making hundreds of thousands of dollars in what the authorities called an “illegal body part scheme,” pleaded guilty to mail fraud on Tuesday, the Justice Department said.

The woman, Megan Hess, 45, the principal figure in the scheme, was assisted by her mother, Shirley Koch, who is in her late 60s, prosecutors said. As part of a plea agreement, eight other criminal charges against Ms. Hess were dropped. She could face up to 20 years in prison.

“I exceeded the scope of the consent and I’m trying to make an effort to make it right,” Ms. Hess said in United States District Court in Grand Junction, Colo., on Tuesday, according to The Daily Sentinel. “I’m taking responsibility.”

Here is more from the NYT.  And this service “retrieves your dead loved ones’ tattoos and preserves them as framed mementos.”  Not illegal.

Is remote work lowering pecuniary wages?

by  Tyler Cowen in

Maybe so, according to the latest results from Jose Maria Barrero, Nicholas Bloom, Steven J. Davis, Brent H. Meyer and Emil Mihaylov:

The recent shift to remote work raised the amenity value of employment. As compensation adjusts to share the amenity-value gains with employers, wage-growth pressures moderate. We find empirical support for this mechanism in the wage-setting behavior of U.S. employers, and we develop novel survey data to quantify its force. Our data imply a cumulative wage-growth moderation of 2.0 percentage points over two years. This moderation offsets more than half the real-wage catchup effect that Blanchard (2022) highlights in his analysis of near-term inflation pressures. The amenity-values gains associated with the recent rise of remote work also lower labor’s share of national income by 1.1 percentage points. In addition, the “unexpected compression” of wages since early 2020 (Autor and Dube, 2022) is partly explained by the same amenity-value effect, which operates differentially across the earnings distribution.

Here is the NBER working paper.

Economists grabbing coffee

by  Tyler Cowen in

From Panka Bencsik:

This is a continuously growing list of PhD holding (or soon to be) economists (and economics-adjacent folks) in academic (and academic-adjacent) positions who would be happy to grab coffee with colleagues visiting their city once it’s safe to do so again. Much in the spirit of #EconTwitter, the list is intended to open doors for informal, relaxed communication, and peer-to-peer research conversations.

Started in March 2020, EconBrew now has over 300(!) economists from 40+ US states and 35+ countries worldwide. The effort is particularly geared towards offsetting some of the loss stemming from the global pandemic halting ways to connect with colleagues. I hope this list can serve as one of the many steps we can take to start new research conversations post-pandemic. Beyond personal meet ups, some of those who signed up are open to chatting with colleagues over Zoom, regardless of location. Everyone who is open to virtual meets has a note with their entry to indicate this.

If you would like to be listed here as someone happy to grab coffee with a colleague, please sign up here: https://forms.gle/qsVHcAGGESJn1zeb7

Here is the link, via Patrick Gourley.