With Due Respect to Harvard...

I have to respectfully disagree with Dr. Ed Glaeser. I haven't read the book by Goldin and Katz, but the article itself seems to miss some important facets of formal education. It's true, there is broad empirical evidence that more education yields significantly more lifetime income. There is also some evidence that more educated societies grow faster (although there is also ample evidence that education and growth are unrelated).

However, before we advocate throwing huge amounts of money or resources at education, we need to be a bit more sophisticated in our thinking. After all, there is some evidence that the primary benefit of secondary and college education is not the facts you learn or clearer thinking, but the signal a diploma or degree sends of your natural ability. Now, signaling is good. Signaling is important.

But what about those individuals with lower ability levels? We have placed so much emphasis on education that anyone without a college degree is considered low class, unimportant, approaching worthless. Aside from the psychological damage equating education with personal value can cause, we end up creating a significant economic problem as well: educational rent-seeking.

Rent-seeking, in an economic sense, means expending resources trying to win a prize, wasting real resources in the process. The book The Overachievers provides graphic examples of the wasted time and resources many high school students spend to get into Ivy League colleges, despite the fact that only a small fraction of them can even fit in the classrooms. Rent-seeking is a topic we've recently discussed in my economic development class, which is why I bristle at Ed Glaeser's article.

I'm all for education. But we need to provide schooling that actually improves the minds of students, without equating education, earnings, and human worth. I want to see a government that encourages education, not just school funding.

I Am Tired

For those who don't know, I'm going to be a father. If I should have called you, I apologize. That was my mistake.

The downside of this is that my wife is feeling ill a lot lately, which means I need to take over a lot of her jobs around the house. Since I am simultaneously working on my graduate degree, I'm pretty drained these days.

I can't tell if I'm excited or not yet. If you know me, you're aware that I don't get that visibly excited about things. The pregnancy is still early, so in a certain sense it doesn't feel real yet. I think I'll be able to wrap my head around it better after we meet with the midwives.

And yes, before you ask, I did say midwives. We're planning to see them in the middle of September, and if all goes as we hope we won't be going to the hospital at all. They have a "birthing cottage" for the delivery, whatever that means. If something goes wrong, the midwives are associated with a doctor at a hospital up in OKC. We are planning to get ultrasounds and other fancy technical stuff when appropriate, and Jessie will have an epidural if necessary. So it's not like we're taking a wagon to Amish country to have the baby.

For right now, these are all just plans and ideas. The reality is that my wife is working very hard to accommodate Bun (what we're calling the baby until we know the gender), and I'm tired. I hope I can keep up with my growing family (spoiler warning!).

Family Man

"Daddy."
Reed awoke to the sound of his real name, or at least what had become his real name a few years ago. His son did not usually wake him early before church, but he had learned there were no guarantees in parenting.
"Daddy," he heard his son say, more eagerly this time. He still did not open his eyes.
"Yes, son?" Reed asked.
"Daddy," his son said a third time. "There's a scary man." The boy motioned out the doorway, but Reed could not see it.
"There's no man, you just had a bad dream," Reed said. "It's over now, it's ok. Go back to bed."
"Daddy," son said. "There's a man. With chickens."
Reed opened his eyes wearily. Despite all appearances, his son's claim was not ridiculous. The family home had a large lot (just over an acre), large enough to grow their own vegetables and keep some animals. So far the family had not branched out further than keeping chickens.
Reed looked at his bedside clock, which read 5:17. His wife, Liv, rolled over and began to sit up.
"Sweetie," she said, "it's probably just the tree again. It's ok."
"But," the boy said, "but daddy..."
"I'll look," Reed said as he swung his feet out of bed and into his construction site boots. "Liv, will you take him back to bed? Everything's going to be fine." The last sentence was directed at his son, not his wife.
Wood snapped outside in the yard, and the chickens began squawking frantically. Liv and Reed exchanged glances.
As Liv took their son to his room, Reed went to a cabinet in the bedroom and removed a revolver. In another drawer, he found the rounds and placed a couple in the gun. No, not like that, this is serious!

Reed made his way toward the kitchen and looked out the large bay window. He saw the small chicken coop smashed, its former occupants scattering across the lawn. There was a man standing next to the coop shambles, holding one of the chickens in his hands. The chicken struggled for a moment before the man released it. The man then stood there, looking down at the coop, motionless.
"He's fine, and Eileen didn't even wake up," Liv said as she came into the kitchen from her children's room. She stopped as she spotted the man outside. "Reed? What's going on?"
"I'm... not sure," Reed said. "You'd better get your shoes on and go in with the kids. I'm going to go out and see who he is."
"Reed, I don't think that's a good idea," Liv said. "He could be drunk, or on drugs, he could have a gun... I think we should call the police." Reed, still looking at the man outside the window, began to nod slowly (you're really not worried about the Wright family at all, are you?).
The man outside the window turned slowly, looking at the house. "OK, get your shoes on. I'll make the call," Reed said.
The sound of glass crackling and splintering cut the silence from the children's room. Reed's children began to scream.

The parents were at their children's sides faster than should be humanly possible. Liv wrapped her arms around her son, who had jumped out of bed and was hiding behind her legs. As Reed entered the room, his eyes went first to the shattered glass on the floor, then up to the hideous man where the window should have been. He was pulling himself in awkwardly, bits of glass sticking in both of his forearms.
To Reed's side, his baby daughter, Eileen, began to cry. Reed looked up at the home invader, who was almost fully in the room. "Stop now!" Reed shouted. The man did not seem to hear.
Reed aimed and fired twice. The sounds was deafening. His children screamed as the bullet hit the invader in the heart, knocking him to the ground. Reed reached out and picked up his daughter.

The invader stirred, then slowly began to stand. Reed raised the pistol again, but noticed that the gunshot was not the only wound the man had sustained. In fact, he seemed to be decomposing. Reed, his crying daughter in one arm, lowered the gun.
"Liv, run!" Reed shouted. They both did.
The glass from their bay window crashed in, and as the Wrights rounded the corner into their living room, the man from the back yard reached out and grabbed Reed by the right arm.
"Liv!" Reed shouted, handing his daughter to her as he began to struggle with the second invader. Both men fell to the floor.
The man leaned in toward Reed, chomping his jaws. Reed, an expression of disgust on his face, shoved his left forearm into the man's neck, holding his head back.

The flow of this narrative to the contrary, Liv was not some passive damsel-in-distress. Her son still clinging to her clothes, she grabbed a lamp from the armchair table and smashed it into the invader's head. Reed shoved him off, and the zombie (you all got that they're zombies, right?) rolled back onto the floor. Reed grabbed the pistol off of the floor. He had only loaded two rounds in, so he stumbled toward the kitchen table, where he had left the rest of the rounds. Grabbing the box, he frantically tried to load them as the zombie on the floor began to rise. A guttural moan from the doorway behind them indicated the first zombie had almost caught up to them (rather slowly, it would seem). Glancing out the hole that used to be the bay window, Reed saw what appeared to be a young girl stumbling slowly across his yard toward him.
"This cannot be happening!" Liv said. She had begun to cry under the stress as well.

"GO!" came the shout from the front door as it was kicked in. Two soldiers swept into the room, one holding a pistol, the other an assault rifle. The man with the pistol turned toward the zombie who had just gotten off the floor, then swung towards the one in the doorway. "It's a goner!" he shouted, then fired two shots directly into the zombie's head. The zombie slumped to the ground.
"Got 'em," said the other soldier. He raised his rifle and fired a burst into the other invader's chest. The zombie was knock back to the ground, rolling around but still very much alive. The soldier then turned toward the female zombie nearing the window and fired again. Another chest shot.
The soldier with the pistol had holstered his weapon and stepped into the kitchen. He offered Reed a hand.
"Let's go," he said.
"What is going on?!" Reed asked. He seemed understandably out of his depth.
"We need to move, now!" The soldier said. Reed stood, slipping his pistol into one of the deep pockets of his pajama pants, a fist full of rounds into the other. Being out of one's depth need not over-shadow one's duty as a husband and father to protect his family. And by one I mean Reed.

The family was herded into the back of a military transport truck with a few of their neighbors. Gun shots continued to sound.

What I'm Watching

OK, I'm sure everyone reading this has picked up on the wave of popularity, but I'm hooked on the latest interwebs craze: Doctor Horrible's Sing-Along Blog. This particular bit of genius is brought to you by Joss Whedon. His idea was to have a professional television experience without the "middle-man" of the major studios.

Doctor Horrible has superheroes. It has showtunes. It's campy, but not too campy. It's up there with Homestar Runner and All Your Base as far as I'm concerned.

Nothing else interesting to say. I might have something after my core exams next week (pretty intimidating, huh?). If not, you may have to wait for the next zombie apocalypse installment (teaser: zombies become less funny when children are involved).

Storm's Coming

Mr. Redding plucked the last Dr. Pepper can from the refrigerator and closed the door. He popped the top as he walked back to the media room and sat down in his La-Z Boy. Mrs. Redding handed him his newspaper, then returned her attention to her knit baby blanket in-progress. The television glowed with the images of the local nightly newscasters.

".... Davis added that, perhaps as a consequence of the declining economy, the purchasing of miniature representations of the things that tourists enjoy going to the tops of has dropped by 14 percent.
"Well, it was another hot one today, Dusty," the newscaster said, "How does the holiday weekend look?"
"We've got a big change coming halfway through this weekend, Ben," said Dusty Storm, the most unfortunately named meteorologist in the state. "It was not only hot, but really dry today. Parched, even. We've been needing more synonyms for dry lately. But look out, because changes are in the wind; let's take a look at the Super Doppler Thirty Thousand Radar, where down in the gulf..."

The front door opened quietly as Rose entered. Barky--the family dog--certainly was, until he saw who had come in.
"Shush, Barky," Rose said.
"How was dinner?" Mrs. Redding asked as Rose stepped into the media room.
"It was great, Ginger made a really tasty roast," Rose said.
"...So tonight, they're gonna be feeling those showers in the Dallas area. Meanwhile, there's a cold front coming down through Colorado, giving them some much needed relief from the heat up in the Mile High City...."
"Did you have anything to drink?" Mr. Redding asked.
Rose responded hesitantly. "Yes, Dad, I had something to drink. Just a bit of wine with dinner. I waited a couple hours before coming home."
Mr. Redding paused. "Alright, then," he said. "I'm glad you're being responsible about it."
"I was very responsible," Rose said.

Rose picked up a book off the coffee table. "Well, I think I'm going to read in my room for a few minutes, then go to bed."
"...All this is going to mean another hot day tomorrow, turning muggy by your drive home..."
"Early start?" Mrs. Redding asked.
"Well, Ginger wants me to open the shop in the morning; nine isn't that early, but I am pretty tired. Her brother and sister-in-law are in town," Rose said.
"And things could get pretty stormy in the metro area around ten o'clock tomorrow evening. On my five day forecast, Sunday is looking like a complete transformation from today..."
"Good night, honey," Mrs. Redding said.
"Good night, honey," Mr. Redding said.
"Good night," Rose said.

THE NEXT MORNING

beep. beep. Beep. BEEP. BEEEEPP!!
Rose slapped the alarm clock's snooze button like an overly-fresh teenage hooligan. Seven in the morning comes far too early the night after a tasty roast.
An hour later, Rose was munching on one of her preferred breakfasts--sprouted whole-wheat and raisin bagel with cream cheese--and reading the book from the night before. The morning news crew joked around on the TV, sporadically reporting the same news items from the night before.
"According to a report released Monday by the American Tourism Society, going to the tops of things is still the preferred activity among the nation's tourists...." Very little news breaks between 10pm and 8am.

Rose's brother ambled into the room.
"So, Rose, anything exciting planned for the day?"
"I'm opening the shop," Rose answered.
"Ah, the candy shop. Not necessarily exciting," he said. "Although I do enjoy those truffles."
"You never know," Rose said, "government spies could drop in for a snack before a major shakedown."
"True, true," her brother said. "You know, there are pretty much military experiments going on everywhere."
Rose smiled. "And all the time," she said.
"Anyway, some of the guys are probably coming over this evening," her brother said. "We're going to watch some kung fu movies. You're welcome to join us."
"Thanks," Rose said. "I'll probably just, you know. Read a book."
"We might watch some sort of dystopian disaster instead," he said.
Rose laughed lightly. "That's an entirely different story," she said. "Call me if you guys switch."

No government spies dropped in for a snack that morning. No, seriously. Only boring people from 9am until half-past noon. By then, Ginger had come in and asked Rose if she had been watching the news. Rose looked at her as if Ginger had just put an Easter basket on her head.
"No, it's awful," Ginger said. "There's been some sort of terrorist attack in Dallas."
"Are you serious?" Rose asked.
"Yeah. Some sort of biological weapon," Ginger said. "They haven't really explained anything yet. I'm not sure they know; it's just really scary."
"Oh my goodness," Rose said. Stronger language was not yet warranted, and Rose cursed the way she drank: Responsibly.
"I know!" Ginger said. "Hey, I'll watch the front, you go ahead and have lunch in the back."
"OK, thanks, Ginger."
Rose went into the back and took out her lunch. Out of instinct, she also took out her book. She stared at the book for a few moments before turning on the small TV in the back.

"For those of you just tuning in"--How did they know?--"let's quickly recap what we know so far. There has been an outbreak of what the CDC describes as 'an air-borne neuro-toxin' in the Dallas, Texas area. We have been told that between two and four AM the first cases were reported in several suburbs around Dallas. The Department of Homeland Security has stated that they are not ruling out a terrorist attack at this time, although there seems to be no central target here. Again, the earliest cases were reported in Plano, Irving, Mesquite, and Grapevine, with Denton following shortly thereafter. As of about ten fifteen this morning, the CDC has reported at least three cases in the downtown area. The governor has called in the national guard, and all residents--including us, Dan--are being escorted outside what is being called a 'quarantine zone.' We have not been able to get any footage of any victims, but some of the people we've talked to have described them as 'glassy eyed' and verbally non-responsive. There are rumors floating around that victims may have convulsions in response to being touched, although it's difficult to separate wild speculation from eyewitness accounts down here. Naturally, we're just reporting everything we hear."

RIIIIIINNG!
The telephone gave Rose a start. Telephones are always loudest when they are unexpected.
Ring. The second ring was expected.
Giving the TV a worried glance, Rose turned away from it and answered the phone.
"Hello?"
"Rose? It's Claire."
"Oh, hi Claire," Rose said. "Did you want to talk to Ginger?"
"I just wanted to make sure she'd seen the news," Claire said.
"Yeah, she has. I'm watching it right now, actually," Rose said.
"Have they said anything about the attacks?" Claire asked.
"They think it was terrorists," Rose said.
"No, not that. Sonny called from work, and he said that some of the victims down in Dallas were attacking people," Claire said. "Scratching and biting at people."
Rose's face hardened. "Really? Where did he hear that?"
"He said he read it online," Claire answered.
"Well, and nobody on the Internet would make things up," Rose said. "I wouldn't be too sure about that report."

The melodic tones of the Emergency Broadcast System played across the TV.
"Claire? I'm going to have to go," Rose said.
"Yeah, sure," Claire said. "Tell Ginger I'll call her tonight."
"OK."
The President of the United States stepped behind a podium on the screen.
"My fellow Americans, training exercises. It's just a training exercise. Chill out. Also, I did not have sex with that woman. We really thought there were WMDs; my bad. We're sending you more stimulus checks. And I've got Olympic fever. So do things you always do. Buy magazines (maybe don't go on vacation right this moment). Just calm down, people!"

The president was in rare articulate form. If he wasn't worried, how bad could it be?

THAT EVENING

Rose did not watch a movie with her brother that evening. Despite the suggestions of Escape from New York, Equilibrium, and Minority Report, his friends instead selected The Forbidden Kingdom. Not being one to intentionally cause herself regret, Rose instead accepted an invitation from Ginger and Claire to go dancing. No, not that. I mean Polka dancing.
There's no need to go into the details of the evening now (aside from a reference to this news item); the important point is that the rain didn't start until Rose was almost home. Rose walked into the house around midnight, and was sound asleep by 12:30.

She would have stayed that way, but Barky had other ideas. He was going crazy, more energetic and concerned than your average nervous dog after three cups of coffee. "Barky? Are you on time yet?" Rose said. Rose was clearly still disoriented. She could hear her brother in the living room with Barky.
"Barky? What's wrong with you?" her brother said. "What are you doing? Huh?" He sounded confused.
Rose heard a scuffling sound. She looked at her bedside clock, which read 3:42. More scuffling, but louder.

BANG! A bright light shone in through Rose's now open door. Her brother stood in the doorway.
"Rose?!? Wake up!" He said. "Rose, it's happening!"
"What's happening?" Rose asked as she sat up.
"They're here," her brother said. "Plan A, Rose. Plan A!"
"Plan A," Rose said. "Alright. Let's go."

Rose had been preparing for this for years. Plan A required meticulous preparation, bulky equipment in multiple checkpoints, and a well conceived course of action.
Rose and her brother went into the living room and looked out. There, across the street, stood what had once been a man. His clothes were shredded, his body decomposed. At his feet, an elderly woman he had clearly just killed. As they watched, the elderly woman twisted around and stood up.

"Definitely not terrorists," Rose said.

Insight

As mentioned in the previous post, I like using stories to teach microeconomics. One of the main things to take away from undergraduate micro courses is good economic intuitions and the ability to meaningfully ask (and sometimes answer) the question "Why would this person do that?"

In teaching intermediate micro this summer I had students write two economic intuition papers. The point of the papers is for students (1) to notice things in the world around them that lack obvious explanation, (2) ask relevant questions that get at the underlying choices and behavior of decision makers, and (3) use the reasoning of the course and an understanding of how people respond to the incentives around them to explain interesting behavior. Overall, I think it was a great success.

At the request of a friend, here is a sample of questions students came up with (obviously without names / grades / identifying characteristics):

-Why do DVD boxes have similar dimensions to VHS boxes?
-Why do most restaurants offer free refills on drinks?
-Why do some restaurants stay open 24 hours/day despite very little business overnight?
-Why do companies give money to charities if their sole purpose is to make money for shareholders?
-Why do pizza businesses mail out coupons, but not offer them to customers when they make an order?
-Why does Philip Morris advertise that 'there is no safe cigarette'?
-Why does basic cable cost the same to everyone, no matter how much programming different customers watch?
-Why do car dealerships advertise discounts on hail damaged cars?
-Why would more experienced taxi drivers use more shortcuts and reduce the driving time for each fare?
-Why does Wal-Mart have such a liberal return policy compared to other stores?
-Why would electric companies try to get their customers to use less electricity?
-Could having more restaurants on Ed Noble Parkway actually make Norman residents worse off?

While many of these could be explained as altruism, habit, good-PR, discrimination, or irrationality, all of these questions can be answered better as simple, reasonable responses by rational people to the incentives around them. While those other influences do matter, their importance is greatly overstated much of the time because economic insight is ignored.

If you'd like to hear some basic answers to any of these questions, just ask. And feel free to ask your own economic intuition questions in the comments!