Do people know what’s good for them – or their children. (Hint: Not always)

Human Capital Effects of Anti-Poverty Programs: Evidence from a Randomized Housing Voucher Lottery by Brian Jacob, Max Kapustin, Jens Ludwig – #20164 (CH ED HE PE)

Abstract:

Whether government transfer programs increase the human capital of low-income children is a question of first-order policy importance. Such policies might help poor children if their parents are credit constrained, and so under-invest in their human capital. But it is also possible that whatever causes parents to have low incomes might also directly influence children’s development, in which case transfer programs need not improve poor children’s long-term life chances. While several recent influential studies suggest anti-poverty programs have larger human capital effects per dollar spent than do even the best educational interventions, identification is a challenge because most transfer programs are entitlements. We overcome that problem by studying the effects on children of a generous transfer program that is heavily rationed–means-tested housing assistance. We take advantage of a randomized housing voucher lottery in Chicago in 1997, for which 82,607 people applied, and use administrative data on schooling, arrests, and health to track children’s outcomes over 14 years. We focus on families living in unsubsidized private housing at baseline, for whom voucher receipt generates large changes in both housing and non-housing consumption. Estimated effects are mostly statistically insignificant and always much smaller than those from recent studies of cash transfers, and are smaller on a per dollar basis than the best educational interventions.

 

Windows, workplaces, job quality and productivity

Life is miserable: run, run, run

I’ve always been struck by how we debate flexibility in the labour market without paying attention to the other problem in the labour market which is that it’s extremely difficult to find out whether you’re really going to like a job until you take it, and then, if you don’t well it’s too late – lots of costs and general angst getting out and moving onto something better. (Will it be better, or just the same old, same old – I’d better stick it out where I am).

So I took the problem down to Troppo labs which came up with Windows on Workplaces which starred (not) at the 20:20 Summit. Hey why pay attention to something new when you can go with the same old same old same old same old Golden Gurus. (See the same article I just linked to.) The basic idea of Windows on Workplaces – quoted from the linked post is as follows:

Say you particularly value some aspect of a job you’re applying for – for instance a good career path, intrinsically rewarding work or flexible family friendly hours. If youre applying from outside the firm youre generally in the dark. . . .

Now firms regularly survey their employees regarding their satisfaction with these things. So it would be good if you could get a peek at their answers. [But] firstly, firms that did badly wouldn’t want to release their information. The second problem is trickier still. Even if you somehow compelled firms to release this data, their survey results cant be readily or reliably compared because they’re not reported against some common standard. I propose . . . not that governments mandate some standard, but rather that they organise and campaign to encourage a standard to emerge. . . . The best firms have an interest in such a standard emerging as it would advantage them in competing to attract employees. And governments are also major employers, so they could establish standards for their own agencies to report against, which, if deftly done might form the kernel around which more widely used standards might emerge.

I’ve never tried to do any empirical work on the extent to which this could improve productivity – though I think it would be large. Now, in the process of completing a major project on estimating the value of open data to the Australian economy, a colleague referenced this paper.

“Match Quality, Worker Productivity, and Worker Mobility: Direct Evidence From Teachers”
by C. Kirabo Jackson. Here’s the abstract. Extremely promising I reckon! Continue reading

What’s wrong with TED talks – hint: quite a lot

I have almost certainly fulminated in various asides against TED talks on this blog, and even one full on cri de coeur against retail profundification. (I promised one on business class profundification but I haven’t managed to do it yet.

Anyway, a friend sent me this TEDx talk which is about what’s wrong with TED Talks. It’s terrific. Indeed, if you want to watch it you can, but you can also see the text of the speech reproduced on the speaker’s website and in the Guardian. It’s always annoyed me that transcripts aren’t provided as a matter of course. They save a lot of time.

My favourite quote on economics:

Our options for change range from basically what we have plus a little more Hayek, to what we have plus a little more Keynes. Why?

Enjoy.

The singularity: which jobs will go?

 

Pretty interesting paper (pdf).

The abstract:

We examine how susceptible jobs are to computerisation. To assess this, we begin by implementing a novel methodology to estimate the probability of computerisation for 702 detailed occupations, using a Gaussian process classifier. Based on these estimates, we examine expected impacts of future computerisation on US labour market outcomes, with the primary objective of analysing the number of jobs at risk and the relationship between an occupation’s probability of computerisation, wages and educational attainment. According to our estimates, about 47 percent of total US employment is at risk. We further provide evidence that wages and educational attainment exhibit a strong negative relationship with an occupation’s probability of computerisation.

The last paragraph of the conclusion.

Finally, we provide evidence that wages and educational attainment exhibit a strong negative relationship with the probability of computerisation. We note that this finding implies a discontinuity between the nineteenth, twentieth and the twenty-first century, in the impact of capital deepening on the relative demand for skilled labour. While nineteenth century manufacturing technologies largely substituted for skilled labour through the simplification of tasks (Braverman, 1974; Hounshell, 1985; James and Skinner, 1985; Goldin and Katz, 1998), the Computer Revolution of the twentieth century caused a hollowing-out of middle-income jobs (Goos, et al., 2009; Autor and Dorn, 2013). Our model predicts a truncation in the current trend towards labour market polarisation, with computerisation being principally confined to low-skill and low-wage occupations. Our findings thus imply that as technology races ahead, low-skill workers will reallocate to tasks that are non-susceptible to computerisation – i.e., tasks requiring creative and social intelligence. For workers to win the race, however, they will have to acquire creative and social skills.

Copyright and Fair Use.

In his introduction to his translation of the Analects of Confucius, Pierre Ryckmans likened that ‘literary classic’ to a coat hook that has over the centuries acquired so many layers of coats that it can no longer be seen-has become so big that it completely obscures the corridor it was hung in. And that is not a bad metaphor for ‘copyright’ itself. Something that started, in 1709 as a fairly simple statute  “An Act for the Encouragement of Learning, by Vesting the Copies of Printed Books in the Authors .. for “.. the Term of One and twenty Years” has by now become such a huge multilayer, intertwined, spaghetti cake  that it is virtually impossible to sanely approach it as a totality. Not going to try. Continue reading

Perverse Consequences of Well Intentioned Regulation: Evidence from India’s Child Labor Ban

by Prashant Bharadwaj, Leah K. Lakdawala, Nicholas Li – #19602 (CH DEV)

Abstract:

While bans against child labor are a common policy tool, there is very little empirical evidence validating their effectiveness. In this paper, we examine the consequences of India’s landmark legislation against child labor, the Child Labor (Prohibition and Regulation) Act of 1986. Using data from employment surveys conducted before and after the ban, and using age restrictions that determined who the ban applied to, we show that child wages decrease and child labor increases after the ban. These results are consistent with a theoretical model building on the seminal work of Basu and Van (1998) and Basu (2005), where families use child labor to reach subsistence constraints and where child wages decrease in response to bans, leading poor families to utilize more child labor. The increase in child labor comes at the expense of reduced school enrollment. We also examine the effects of the ban at the household level. Using linked consumption and expenditure data, we find that along various margins of household expenditure, consumption, calorie intake and asset holdings, households are worse off after the ban.

The paper is here.

Are Tenure Track Professors Better Teachers?

by David N. Figlio, Morton O. Schapiro, Kevin B. Soter – #19406 (CH ED LS)

Abstract:

This study makes use of detailed student-level data from eight
cohorts of first-year students at Northwestern University to
investigate the relative effects of tenure track/tenured versus
non-tenure line faculty on student learning. We focus on classes
taken during a student’s first term at Northwestern, and employ a
unique identification strategy in which we control for both
student-level fixed effects and next-class-taken fixed effects to
measure the degree to which non-tenure line faculty contribute more
or less to lasting student learning than do other faculty. We find
consistent evidence that students learn relatively more from
non-tenure line professors in their introductory courses. These
differences are present across a wide variety of subject areas, and
are particularly pronounced for Northwestern’s average students and
less-qualified students.

http://papers.nber.org/papers/W19406?utm_campaign=ntw&utm_medium=email&utm_source=ntw

Universities as Royal Courts

The journal ‘Agenda’, the policy journal of the College of Business and Economics at The Australian National University just released a piece of mine called ‘Universities as Royal Courts’. One can download it free of charge (just click on the link). It continues my long-running attempt of trying to explain to the Australian online public that Vice Chancellors and other higher-level bureaucrats in our universities have much higher salaries than in other countries; that at some universities (like QUT) the standards for being called a professor seem rather low if one is an administrator; why some universities have an overpaid upper echelon in the first place; and how the situation could be improved. This new piece draws parallels between the way some universities are run and how the royal courts of Europe were organised, complete with pageantry and scheming barons. The article carries a misspelling of my name ( a deliberate finishing touch of the editor, I think) which underscores the tongue-in-cheek humour of the piece. Enjoy!