The wage stagnation that dare not speak its name
30 Apr 2015 Leave a comment
in discrimination, gender, labour economics, occupational choice Tags: gender analysis, gender wage gap, media bias, reversing gender gap, wage stagnation
Richard Nixon’s public choice economics of the Vietnam anti-war movement
30 Apr 2015 Leave a comment
in labour economics, labour supply, occupational choice, politics - USA Tags: conscription, peace movements, Richard Nixon, Vietnam war
The Vietnam anti-war movement were primarily the result of the draft: hell no, we won’t go and the burning of draft cards. Richard Nixon was as cunning a rat who ever occupied the Oval Office. He was elected in 1968 to end the Vietnam war and to end the draft.
Nixon had an intuitive economic understanding that the anti-war movement’s rioting in the streets and campuses was very much motivated by private gain. In particular, the threat of being drafted. The notion that revolutions and political movements are motivated by private gain is not new.
Vietnamisation changed everything. In 1969, Nixon started the process of phasing down the sending of further combat troops to Vietnam and the phasing down of the draft. US troop withdrawal started on July 1st 1969 with completion dates – December 1970, June 1971 and December 1972.
By the beginning of 1972, over 400,000 U.S. military personnel had been withdrawn, virtually all combat troops. The protests were against ending up in the jungle – not up the rear with the gear. There were 24,000 US troops in Vietnam in 1972. This compares to 560,000+ in 1969.
A Vietnam vet told me that when he returned to his U.S. campus in 1971 for graduate studies, it was very quite compared to 1969 because the spectre of the draft had gone in their minds.
The anti-war movement was really motivated by hell no, we won’t go. As soon as the prospect of going to Vietnam faded away, so did the anti-war movement.
The robots are coming, the robots are coming, but is it for my current job?
29 Apr 2015 1 Comment
in entrepreneurship, labour economics, labour supply, occupational choice Tags: creative destruction, entrepreneurial alertness, innovation, skill biased technical change, technological unemployment
How to argue for welfare reform when sincerely arguing against the 1996 US Federal welfare reforms
28 Apr 2015 Leave a comment
in labour economics, labour supply, occupational choice, poverty and inequality, welfare reform Tags: 1996 US welfare reforms, female labour supply, labour demographics, welfare state
The share of single mothers without a high school degree with earnings rose from 49 percent to 64 percent between 1995 and 2000 but has since fallen or remained constant almost every year since then. At 55 percent, it’s now just slightly above its level in 1997, the first full year of welfare reform (see first graph).
TANF now serves only 25 of every 100 families with children that live below the poverty line, down from AFDC’s 68 of every 100 such families before the welfare law
Over the last 18 years, the national TANF average monthly caseload has fallen by almost two-thirds — from 4.7 million families in 1996 to 1.7 million families in 2013 — even as poverty and deep poverty have worsened.
The number of families with children in poverty hit a low of 5.2 million in 2000, but has since increased to more than 7 million. Similarly, the number of families with children in deep poverty (with incomes below half of the poverty line) hit a low of about 2 million in 2000, but is now above 3 million.
The employment situation for never-married mothers with a high school or less education — the group of mothers most affected by welfare reform — has changed dramatically over the last several decades.
In the early 1990’s, when states first made major changes to their cash welfare programs, only about half of these mothers worked.
Importantly, there was a very large employment gap between the share of these never-married mothers and single women without children with similar levels of education, suggesting that there was substantial room for these never-married mothers to increase their participation in the labour force.
By 2000, the employment gap between these two groups of women closed, and it has remained so. But in the years since, the employment rate for both groups has fallen considerably.
The employment rate for never-married mothers is now about the same as when welfare reform was enacted 18 years ago. This suggests that the economy and low education levels are now the causes of limited employment among never-married mothers — not the availability of public benefits or anything particular to never-married mothers.
The Centre on Budget and Policy Priorities, who hail clearly from the Left of American politics, scrupulously documented the following:
- Big gains in the employment of single mothers until a setback in the Great Recession but is still much better than in 1996;
- Welfare dependency dropped by two thirds;
- Despite this two third drop in welfare dependency, and earnest predictions of acute poverty and deprivation made in 1996, the number of families in deep poverty has not changed, and the number of families in poverty fell significantly and only rose again with the Great Recession; and
- There was a dramatic increase in the percentage of never married mothers in employment, so much so that there is no difference in the employment rate of single women with no children and never married mothers!
Welfare dependency down by two thirds, employment of never married mothers up to levels no one thought possible, family poverty down, and economic independence is much more widespread and all because of the 1996 US Federal welfare reforms. That sounds like success to me – a great success.
via Chart Book: TANF at 18 | Center on Budget and Policy Priorities.
The Lion must be drugged
27 Apr 2015 Leave a comment
in cats, health and safety, labour economics, occupational choice Tags: daredevils
A lion riding in the sidecar of a go-kart at a wall of death, Massachusetts, c. 1929. http://t.co/Dlo7XcdhNC—
ClassicPics (@History_Pics) April 27, 2015
Why is the rapid closing of the gender wage gap in New Zealand not celebrated more?
27 Apr 2015 1 Comment
in discrimination, gender, human capital, labour economics, labour supply, occupational choice, politics - New Zealand Tags: activists, do gooders, gender wage gap, Left-wing hypocrisy, Leftover Left
With the rapid closure in the raw female male wage gap in New Zealand over the last 15 or so years, the lack of celebration of this achievement among equal pay activists is puzzling.
Source: Statistics New Zealand, New Zealand Social indicators, Median hourly earnings.
The reversed college gender gap
23 Apr 2015 Leave a comment
in discrimination, economics of education, gender, human capital, labour economics, labour supply, occupational choice Tags: gender wage gap reversed gender gap
CHART: The Huge College Degree Gender Gap: Since 1982, Women Have Earned ~10M MORE US College Degrees Than Men! http://t.co/83JhRfwCLE—
Mark J. Perry (@Mark_J_Perry) March 11, 2015
Should everybody go to college? Could everybody go to college?
22 Apr 2015 Leave a comment
in economics of education, human capital, labour economics, labour supply, occupational choice Tags: College premium, economics of personality traits, education premium, IQ
Superstar comedians make serious money nowadays
21 Apr 2015 Leave a comment
in economics of media and culture, entrepreneurship, labour economics, occupational choice, TV shows Tags: comedians, entrepreneurial alertness, superstars
#Seinfeld was a huge financial success –> The top 25 richest living comedians: randalolson.com/2015/03/04/top… #dataviz http://t.co/vWSUgO1jIE—
Randy Olson (@randal_olson) March 05, 2015
But why would girls want to sit in a corner playing chess?
20 Apr 2015 Leave a comment
in economics of education, human capital, labour economics, occupational choice Tags: chess, economics of personality traits, lost boys, reversing gender gap
For a logical thinker, chess grandmaster Nigel Short missed the obvious move. Teenage girls have better things to do with their talents and in particular their superior reading skills than gaze over a chess board.
The 30 point advantage that 15-year-old girls have in reading scores in the PISA test – see the chart below – is equal to an extra six months schooling. Six months extra schooling explains many a gender and ethnic wage gap.
Having being a member of a few chess clubs, and run chess clubs and large chess tournaments, there are an unusual number of oddballs, eccentrics and mentally ill people who play chess.
The systematic evidence of a greater incidence of learning disorders, Asperger’s syndrome as well is bipolar disorders among teenage boys all encourage teenage boys to focus on chess if only to give an outlet to their obsessive behaviours.
It is for the same reason that socially awkward teenage boys may be attracted to computer programming if they have various obsessional disorders.
Who-d a-Thunk It? The new OECD Report on 15-Year Olds in 60+ Countries Finds Significant Gender Differences? http://t.co/X2rGVygPwF—
Mark J. Perry (@Mark_J_Perry) March 11, 2015
Post-School human capital investments come in many forms
20 Apr 2015 Leave a comment
in economics of education, human capital, industrial organisation, labour economics, labour supply, minimum wage, occupational choice, personnel economics Tags: on-the-job human capital, on-the-job training
Fathers’ time use, 1965 and now
19 Apr 2015 Leave a comment
in economics of love and marriage, labour economics, labour supply, occupational choice Tags: child rearing, family demographics, household division of labour, household production, marriage and divorce
A long-standing anomaly about racial discrimination in the labour market
19 Apr 2015 Leave a comment
in discrimination, human capital, labour economics, labour supply, occupational choice Tags: co-worker discrimination, customer discrimination, employer discrimination, labour market discrimination, racial discrimination
CHART: Asians Make 15% More Than Whites, Is That Because of 'Asian Privilege' or Discrimination Against Whites? http://t.co/9YnkDDrcbO—
Mark J. Perry (@Mark_J_Perry) March 19, 2015
50% more R&D since the 60s, but still no growth dividend?
18 Apr 2015 1 Comment
in applied price theory, economic growth, economics of education, entrepreneurship, history of economic thought, human capital, industrial organisation, macroeconomics, occupational choice, survivor principle Tags: Ben Jones, Chad Jones, creative destruction, endogenous growth theory, innovation, R&D
Spending on intellectual property products has risen in the USA from 1% in 1950 to 5% now. Public R&D spending in the USA has been pretty static for 60 years. Intellectual property products in the chart below includes traditional research and development, spending on computer software, and spending on entertainment such as movies, TV shows, books, and music. Spending on software and entertainment was only recently measured in the US national accounts. This inclusion of intangible capital investments will radically change the story of economic growth and the business cycle in the 20th century.
Source: Chad Jones (2015).
The growth rate in the USA hasn’t changed much despite this massive increase in intellectual property property product production. Is innovation getting harder? R&D is supposed to boost the growth rate, if you are to believe politicians bearing subsidies for it wherever they find it.
Source: Chad Jones (2015).
Ben Jones in The Burden of Knowledge and the Death of the Renaissance Man: Is Innovation Getting Harder? found that as knowledge accumulates as technology advances, successive generations of innovators may face an increasing educational burden. Innovators can compensate through lengthening their time in education and narrowing expertise, but these responses come at the cost of reducing individual innovative capacities. This has implications for the organization of innovative activity – a greater reliance on teamwork – and has negative implications for economic growth.
This longer period of education and initial study is not compensated by inventors innovating for longer spans of their lifestyle. This rising burden of knowledge is cutting into their best years of their lives. Jones found a broad and dramatic declines in early life-cycle productivity among great minds and ordinary inventors, and a close relationship of these trends with increased training duration.
Jones found that the age at first invention, specialisation, and teamwork increased over time in a large micro-data set of inventors. Upward trends in academic collaboration and lengthening doctorates can also be explained in his framework of innovation getting harder because of a rising burden of knowledge. Co-authorship in academic literature has increased, including physics, biology, chemistry, mathematics, psychology, and economics. This measure of teamwork has increased 17% per decade.
Using data on Nobel Prize winners, Jones found that the mean age at which the innovations are produced to win the Prize has increased by 6 years over the 20th Century.
- Before 1901, two-thirds of the Nobel laureates did their prize-winning work before the age of 40 and 20 per cent did it before age of 30.
- By 2000, however, great achievements seldom occurred before the age of 40.
It’s now taking longer for scientists to get their basic training and start their careers. There is simply more to learn because knowledge in all fields has grown by quantum leaps in the past century. Nobels are being handed out for different types of work than a century ago.
- There has been a trend away from awarding prizes for abstract, theoretical ideas.
- Now more honours are being bestowed on people who have made discoveries through painstaking lab work and experimentation – which takes a lot of time to do.
Jones’ theory provides an explanation for why productivity growth rates did not accelerate through the 20th century despite an enormous expansion in collective research effort and levels of education and many more graduates. Innovation is getting harder?
Utopia, you are standing in it! 
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