Category Archives: Education

Spending more time with the kids

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Economic Conditions and Child Abuse
by Jason M. Lindo, Jessamyn Schaller, Benjamin Hansen – #18994 (CH HE LE LS)

Abstract:

Although a huge literature spanning several disciplines documents an
association between poverty and child abuse, researchers have not
found persuasive evidence that economic downturns increase abuse,
despite their impacts on family income. In this paper, we address
this seeming contradiction. Using county-level child abuse data
spanning 1996 to 2009 from the California Department of Justice, we
estimate the extent to which a county’s reported abuse rate diverges
from its trend when its economic conditions diverge from trend,
controlling for statewide annual shocks. The results of this
analysis indicate that overall measures of economic conditions are
not strongly related to rates of abuse. However, focusing on overall
measures of economic conditions masks strong opposing effects of
economic conditions facing males and females: male layoffs increase
rates of abuse whereas female layoffs reduce rates of abuse. These
results are consistent with a theoretical framework that builds on
family-time-use models and emphasizes differential risks of abuse
associated with a child’s time spent with different caregivers.

http://papers.nber.org/papers/W18994?utm_campaign=ntw&utm_medium=email&utm_source=ntw

A fable of Eunuchs, Praetorians, and University funding cuts.

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Imagine yourself to be in the mythical Land of Beyond where you need minions to do a dirty job that men with honour would refuse to do. A classic trick in this situation is to pick people despised by the rest of society who are thus dependent on protection and will simply do what is asked for.

The Chinese emperors hit upon this truth when they started to surround themselves with eunuchs, despised by the rest of Chinese society and thus fiercely loyal to their protector, the Emperor. The roman emperors, similarly, made a habit of surrounding themselves with freed slaved who were despised by other Romans, as well as by a dedicated palace guard (the Praetorians) who were the only militia allowed in the vicinity of Rome.

The European colonialists too used this basic ‘dirty dozen’ technique when it came to keeping a large population in check with minimal own presence, particularly in Africa, by elevating some small despised group (ethnic or religious minorities) as the preferred club from whom the senior administrators came. This small favoured group would get personal benefits (riches and influence) but in return they would do whatever the colonizers wanted.

To see the relevance of this for university cuts in the Land of Beyond, you first need to step back a level and imagine yourself to be the Vice Chancellor of a second-rate university that brings in, say, a billion ‘Beyond’ dollars a year out of which some 300 million is money you dont really need to generate that 1 billion. It is ‘potential profit’ if you like. Continue reading →

Where equity and efficiency thrive together: Can you propose some more examples?

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Economists love tradeoffs. Indeed, their basic model of the world breaks down where such tradeoffs don’t occur. Lucky for them since the world really is full of tradeoffs. If you want more carrots, you’ll have to do with fewer of something else. Here they’re substitutes. But, to use an ugly word which first became faddish in the 1980s, where there are synergies between things that you’re after, you’re in a wonderful world.

Economists love arguing that there is a tradeoff between equity (or perhaps equality of income) and efficiency. Of course there are such tradeoffs.  If you tax work at high enough rates, especially of more productive people who are likely to be earning more, if you buy yourself sufficient equity between their own take-home pay and those who are less productive, you may also buy yourself less work from your most productive people – a classic equity/efficiency tradeoff.

But of course the world is full of synergies between efficiency and equity.

Continue reading →

Public goods: the column

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I’ve been talking about this kind of stuff for a fair while in presentations and intimated similar things in some longer pieces and a column or two on Adam Smith and Web 2.0, but I’ve not done a column on Web 2.0 as public goods privately built. But I have now.

THERE’S a revolution going on in the provision of public goods. We need to do some rethinking.

Economists define public goods around two characteristics – which are often illustrated with the classic public good – the lighthouse. There’s no way to stop passing ships benefiting from a lighthouse’s light whether or not they pay. This non-excludability creates the classic dilemma in which everyone waits to free-ride off others’ efforts so no one funds the lighthouse. Enter government, which taxes people to fund such public goods.

As well as being non-excludable, public goods are also non-rival. Consumers are rivals when they buy physical things, such as food, cars, or labour services such as taxi-driving or dentistry. One consumer can only get more of what’s on offer if others get less. By contrast, the ships consuming the lighthouse’s light aren’t rivals – light enough for one creates light enough for all.

Knowledge is a classic non-rival good.

And if non-excludability creates a free-riding problem, non-rivalrousness discloses a great free-riding opportunity. Our modern world dates from around the time these insights emerged. Thomas Jefferson effused about the free rider opportunities abounding as the knowledge economy came wheeling into view:

He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature.”

The value of education to different types of people

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Quite an interesting finding – which also roughly confirms what I would have guessed before I saw the data.

The returns to education for opportunity entrepreneurs, necessity entrepreneurs, and paid employees
Date: 2012
By: Fossen, Frank M.
Büttner, Tobias J. M.
URL: http://d.repec.org/n?u=RePEc:zbw:fubsbe:201219&r=ent
We assess the relevance of formal education for the productivity of the self-employed and distinguish between opportunity entrepreneurs, who voluntarily pursue a business opportunity, and necessity entrepreneurs, who lack alternative employment options. We expect differences in the returns to education between these groups because of different levels of control. We use the German Socio-economic Panel and account for the endogeneity of education and non-random selection. The results indicate that the returns to a year of education for opportunity entrepreneurs are 3.5 percentage points higher than the paid employees’ rate of 8.1%, but 6.5 percentage points lower for necessity entrepreneurs.