FiSH: Yeah? What about 'em?
TGP: I think it's a great idea!
FiSH: Well I think it's terrible.
TGP: You're probably right.
Both: Ho ho ho ho ho
Well, just like with the source material, there's someone on stage offering a performance. Let's see what they have to say. All arguments are simulated and names used entirely without permission.
On Drop Out/Cash In
Translation: in Launching The Innovation Renaissance, I argue in favor of ex post prizes for entrepreneurial efforts as a replacement for ex ante subsidies. The intuition behind this is that a prize system rewards success and that subsidies promote rat-hole rent seeking and dissipation. Under this regime, rewards will accrue to Kirznerian entrepreneurs alone. Students who drop out spuriously understand the downside risk, so this system is unlikely to encourage reckless risk-taking.
Translation: You're not the only voice on this topic, Dr. Tabarrok. I appreciate that there's an efficient way to administer a prize system, but isn't any centrally-managed system prone to bureaucratic error? What about the public choice?
Translation: remember your McCloskey, Nathanael. Ask "compared to what?" Existing higher education subsidies promote education indiscriminately, whether the product serves the public interest or not. You're right that a prize system could be bent to economically inefficient ends, but it's far more likely to promote public over private goods compared to the status quo. The current system is riddled with public choice problems. This might mitigate those.
On Razzle-Dazzle Them
Translation: people could have several different models of the value of education in mind when they talk about signaling. Empirical researchers have found very strong evidence of sheepskin effects. This isn't armchair navel-gazing. But neither does this reject instrumental private benefits of college. You want to study Moliere under the tutelage of an expert to help make yourself a better person? Great! You have my blessing. What you don't have is a legitimate claim on the product of taxpayers so that you can pursue an endeavor that is ultimately of value to yourself alone.
Translation: Skwire and Horwitz are rejecting the claim that education is only a signal. Look at your point estimates for productivity: 0.1. That's not pure signaling, but it's awfully close, my friend.
Translation: Bryan's deliberately omitting private consumption benefits since his ultimate point is about the role of subsidies. Recall from your discussions of public goods that government might have a role in helping provide public goods. It's off topic to include purely private goods in this analysis.
On The Grecian Urn
Lynne Kiesling*: an-i-mal. Uh. Rahr yeah aaaah Lynne eat urn. Raaaahr
Translation: I'm an expert in energy markets, so by extension, I'm an expert in state intervention [chuckle]. But let me also be clear that there are always tradeoffs. It sounds tempting to say that we should encourage politicians to either restrict subsidies to STEM fields or to subsidize them more heavily, but it's not necessarily clear that that's the correct approach. It's true that STEM majors are higher status, but that's insufficient evidence of comparative advantage.
Nathanael Snow: Mahna mahna
Translation: I see what you mean, but among a reasonable political choice set, shifting away from general subsidies towards STEM-specific is a lot more palatable than alternatives like raising interest rates on student loans or eliminating Sallie Mae altogether.
Translation: I see what you mean, but among a reasonable political choice set, shifting away from general subsidies towards STEM-specific is a lot more palatable than alternatives like raising interest rates on student loans or eliminating Sallie Mae altogether.
Me: do do do do do; do do do; do do do do do dooo
Translation: Comparative advantage is part of the whole economy, which is a dynamic process. Political decisions are underpinned by a blinkered static equilibrium model of production. You're right about political constraints, but egads, if we can get marginal cuts to these distorting subsidies that's a pretty Pyrrhic victory, don't you think?
*I've never actually seen Lynne defend this particular theory, she did change her fb pic to Animal, so, you know, fair game (maybe).
*I've never actually seen Lynne defend this particular theory, she did change her fb pic to Animal, so, you know, fair game (maybe).
Fair point, Sarah.
Look, under each of these theories, or under a mixture of them jointly and severally, we in our capacity as analysts and muppets fall afoul of BATNA disparity. Meek 18-year old freshmen have to go to college or risk -gasp- low status employment (or none at all). Now, thankfully, through the efforts of generous, thoughtful people like Mike Rowe, we've got at least one show on television attempting to salvage the relative dignity of manual labor. But I'd agree that the supercilious attitudes of soft-skinned academics does little to engender nobility of spirit among people who would (quelle horreur!) voluntarily choose the hammer over the typewriter. It's soft coercion to be sure that assails the relative status of blue-collar work, but it's venomous and serves to shrink the galaxy of euvoluntary trades scribbled upon the tabula now no longer rasa. I encourage my readers to do what they can to stop Kefka from his assault on Doma Castle.
And yes, that FF reference was for you, Zac.
And if I used your name in vain, please let me know and I'll happily edit.
The real problem here is that in NO POSSIBLE WORLD would TGP EVER say "what me and Steve wrote" :)
ReplyDelete