Wednesday, January 08, 2014

Employment and the advantage of education: The right way to count

People with more education don't just make more money if they have jobs; they're more likely to have jobs in the first place.  As a result, the earnings premium now greatly exceeds the wage premium.  Consider the following caricature approximation of modern male earnings:

(a) College grads with full-time jobs earn 70% more than high school grads with full-time jobs.

(b) 95% of college grads, but only 70% of high school grads, have full-time jobs.  Everyone else receives $0 of income.

College grads in this scenario enjoy a 70% wage premium but a 131% earnings premium.  This is easy to compute: 1.70*.95/.7=2.31, indicating that college grads earn 2.31 times as much as high school grads.

Ability bias aside, is this computation appropriate?  It depends.  If a college degree really reduced your probability of involuntary unemployment from 25% to 5%, then multiplying the wage effect and the employment effect is fine.  College is your ticket out of a hellish situation.

But what if your unemployment is voluntary - in the sense that, given the market wage for people with your skills, you prefer not to work?  Then multiplying the wage effect by the employment effect seems like double-counting.  Yes, college raises what you actually earn by 131%, but it only raises what you're able to earn by 70%.

Not convinced?  Suppose college graduates worked more solely because college speeds up your hedonic treadmill.  After four years of high-achievement socialization, college grads feel like losers unless they earn at least $100,000 a year.  High school grads, in contrast, feel perfectly satisfied with half that.  Or suppose that colleges subtly indoctrinate women with the view that material success is much more important than maternal success.  Why should merely shifting priorities from kids to cash count as a personal "benefit"?  This is just the crude materialism economists are often mocked for espousing.

Now recall that official statistics distinguish between the employed, the unemployed, and those who are "out of the labor force."  The lazy response to my point is to treat the officially unemployed as "involuntarily unemployed" and the officially "out of the labor force" as "voluntarily unemployed."  So if college grads' employed/unemployed/out of the labor force breakdown is 95/3/2, and high school grads' breakdown is 70/10/20, the "correct" college earnings premium is 1.70*(95/98)/(70/80)=94% - more than 70%, but a far cry from 131%.

The diligent response, though, is to adjust official unemployment numbers for the "discouraged worker" and "prideful worker" effects.  At least outside of deep recessions, I tend to think that the latter effect is larger.  But either way, you've got to admit: Unless everyone without a job is involuntarily unemployed, counting the full employment gap as a "benefit" of education is not reasonable.


Principal Tells Seventh Grade Teacher Her Students are 'Not Allowed to Fail'

A seventh grade teacher’s candid email to The Washington Post has shed some light on our country’s tragic education system, in which schools are refusing to punish students for bad behavior.

When WaPo’s Valerie Strauss asked readers the question, “How hard is teaching?,” a veteran seventh-grade language arts teacher in Frederick, Maryland responded with a lengthy note explaining her school’s frustrating policies that ultimately led her to quit her job.

The educator shared why she first decided to pursue a teaching career: she wanted to show young people that education meant “exploring new things, experimenting, and broadening horizons.” But, her dream quickly met reality:

Forced to abandon my hopes of imparting the same wisdom I had gained through my experiences and education, I resigned myself to the superficial curriculum that encouraged mindless conformity. I decided that if I was going to teach this nonsense, I was at least going to teach it well.

This reluctant, yet effective strategy left ten of her students with ‘Fs.’ The grades did not go unnoticed by the school’s prinicipal. She called her into her office and told her the following:

“They are not allowed to fail.”  “If they have D’s or F’s, there is something that you are not doing for them.”

Taken aback, the language arts teacher realized just how poor the school’s standards had become:

What am I not doing for them? I suppose I was not giving them the answers, I was not physically picking up their hands to write for them, I was not following them home each night to make sure they did their work on time, I was not excusing their lack of discipline, I was not going back in time and raising them from birth, but I could do none of these things.

Nor should she have to. Because of the school’s ridiculous policy of passing students who clearly did not put forward the effort, she decided to quit.

Students need to learn responsibility for their actions. If they refuse to do the homework yet still manage to pass the class, what have they learned? That won’t fly in the real world. If you skip work a couple days out of the week or slack off on the job, would you really still expect to get a paycheck?

Not everyone is going to be picked for the starting lineup in kickball. Not everyone is going to be on the honor roll. Nor should they. Having to earn one’s grades promotes a certain drive and discipline.

Bravo to this (former) seventh grade teacher for exposing her school’s low standards and refusing to be a part of it one day more.


Another brick in the wall of Gen Y cultural decline

Schools need to inspire an appreciation of high culture in the younger generation

By Christopher Bantick, writing in Australia

In this age of selfies and X-Factors, spare a thought for the insidious damage being done to Australian serious culture. Given that Pink Floyd may have sung, "Teacher, leave them kids alone", should we be bothered? Yes, very bothered indeed.

The reality that is hidden from many in the Australian community is just how pervasive the celebrity culture is in changing young people's thinking. Moronic introspection is celebrated as significant and worthwhile. If you think I am overstating the case, well consider this.

The vanity that is lauded as virtue pervades the culture to a corrosive extent. Young people have lost the capacity to actually know when something is art, and worthy. Instead, they hang on every word of their latest celeb mouthing inanities.

Taiwan-born director Ang Lee says he makes films to, wait for it, "understand more about himself". If that isn't a 70-millimetre selfie, what is? Then there is the toe-curling indulgence of those music stars, like Sydney singer-songwriter Josh Pyke. He's a 36-year-old who claims that he now "feels he has learnt to sing". Oh please! Can you imagine Pavarotti saying anything so crass?

Or how about this kind of Pyke self-centred twaddle: "I know I can write a song every day and sing it in my voice and it will be OK, but that is not what I do it for. It's about figuring out what your reason is for doing what you're doing."

The kids lap up this kind of self-conscious exhibitionism as a "serious" statement, as they have precious little comparative comment beyond what is shouted out to them from fanzines and blogs of banality.

So who's at fault? Schools need to do more about bringing a little elitism back into the awareness of culture. High culture: fine art, opera, serious drama and music that requires patience and understanding needs to be embedded into the curriculum.

In Australia, elitism is a dirty word. But maybe our jingoistic egalitarianism has gone too far with the sense of cultural equity. Who knows what a sonnet is, a partita, a motet, or who was Goethe or Christopher Marlowe? As for ballet, forget it. There are many other examples.

Why this matters is that without a sense of cultural elitism, then the high cultural markers will atrophy. We'd rather get all teary with Leonard Cohen than concentrate, really concentrate, on Mahler.

The impact this will have on audiences is cause for concern. In the next two decades, the elders or keepers of the cultural treasures will be gone. Their patronage at the box office, let alone their philanthropy, will end. Then what?

Where are the audiences going to come from if today's students have no urbanity and cultural background other than popular cultural indulgences? This is already happening. Ticket prices are not the cause either. Top rock acts are far dearer than most classical musical performances and one Rolling Stones concert ticket would buy a brace or two of good theatre tickets.

What is clear though is that if you go to an opera, a concert of searching classical music or an art show that is not a blockbuster, you'll soon see who's there. Grey hairs and blue rinses. Why? Because they have had the cultural background today's youth lacks.

Sure, private schools are in effect nurseries, or, if you like, the last bastions of elitism. I teach in one and I teach serious, classically demanding literature. Yes, it is elite, consciously so, but anything is elite if it is not pandering to the lowest common denominator. How can a book about a vacuous Sydney teenager reflecting on school, like Melina Marchetta's Looking for Alibrandi, be compared with Jane Eyre? It can't.

This goes beyond subjective taste. Does Lou Reed compare with Segovia? It's a no-brainer. Still, Lou Reed took endless column inches of adulatory, valedictory prose recently because of what he achieved (not a lot).

The callow kids suck up their smoothies of cultural pap when anyone says something "pithy" out of an inarticulate, drug-fuelled haze. But "pithy" is a relative term. Listen to Kurt Cobain who sprayed a generation with teen spirit and left this "mortal coil" (Shakespeare in case you didn't know) with the following memorable statement:

"I don't have the passion any more, and so remember, it's better to burn out than to fade away. Peace, love, empathy."

Compare the immortal lyrical beauty of John Keats, who also died young and said, "I feel the daisies growing over me."

The ambivalence Australia has to any mention of cultural elitism is reflected in its suspicion of what appears to be difficult to understand. In this sense, schools have opted out of their responsibility to simply lift the cultural standard from Banksy to Hogarth.

The fear I have, is that ignorance will be seen as preferable, even desirable, while serious theatre is unviable, serious literature is not published, concert programs are reduced and other forms of cultural elevation are lost.


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