I’m interested in what this means in terms of human capital. Is human capital only a thing in the absolute sense, that in aggregate humans gain knowledge and skills over time, especially in schools? Or are there relative accumulations of human capital, too?
I think there's both. I don't know how to code, I learn to code, coding has monetary and social value in our society, now I've made an absolute gain in human capital - I have something to sell I didn't have before. And of course all the people who I was like before in not knowing how to code have fallen down the human capital latter a little bit because I have climbed.
It's interesting to ask how this works. Imagine a society just like ours but with everyone significantly smarter--the people who would be average in our world are in the bottom 15% in that world. (This is more-or-less what the Flynn effect has done if you think those IQ gains represent real gains in intelligence.)
It's clear that if any of us were moved into that world, our position would probably be worse--maybe here and now you're in the top 15% and there you're dead average. A person who can get into a magnet school or Ivy here has no chance there--he's just massively outcompeted.
And yet, it sure seems like that world is going to be a lot richer and better off than our world over time. Scientific breakthroughs that are just a little too hard to manage here happen there; everyone from the surgeons to the car mechanics to the janitors is a bit cleverer and so does a little better at their jobs. If you could push a button and move yourself to a world where that shift happened 30 years ago, it would be an interesting question whether you'd want to do it. You personally would move down in status relative to others, like a really clever engineer who went to work at the Manhattan project and found himself the dumbest guy in the room most of the time. But the world you moved to would be much richer and most things would probably work better--doctors would be able to cure more diseases, technology would work better, etc.
I feel like almost everyone misses the absolute vs relative issue. Our schools work well enough that almost everyone can read--that's an absolute benefit of education. Most employers can assume their employers can read warning signs (perhaps in Spanish instead of English), do basic arithmetic, etc., and that extends the range of what kind of work can get done and how hard it is to do. Running a similar jobsite in a society where most of the workers can't read is going to be quite different. Absolute improvements in education are a positive-sum change--assuming the extra stuff learned is useful, the pie gets bigger.
OTOH, changing the relative educational performance of one person or group relative to another is zero-sum. If 10% of the kids coming out of high school knew calculus in 1990, and 10% do today, the society is no better off (the pie will be no bigger) if we've swapped things around so that more of those kids are black in 2021, but fewer are white. In terms of what work can get done, what benefit did we get?
For group differences, I think the underlying mental model is that the kids in the underperforming group are being held back by something (current racial discrimination, stigma against "acting white," alien space bats, whatever), and there's some educational reform that would stop holding them back, and then we'd see the underperforming kids get more absolute education, leading to a change in relative rankings. And as I understand it (way less than Freddie does--this isn't my field at all!), attempts to change schools to accomplish this, at least for the black/white gap, have just been a steady string of failures or one-off successes that couldn't be replicated. Whatever is holding those kids back, it seems like it's not something easy for schools to fix.
But that relative inequality is a big political problem. Even if we improve education so that 10% of kids knew calculus in 1990 and 20% of kids know calculus in 2020, if black kids or poor kids or kids from whatever other group still end up underrepresented, a lot of people will think that there hasn't been any progress--you may have taught more kids calculus, but you didn't solve the problem *they* were worried about.
I think there’s a couple of things going on. Part of it is whether to emphasize relative vs. absolute outcomes in terms of what we’re trying to accomplish. I largely agree with this post, but I think the steelmanned argument against would be to say, hey, we seem to agree that education improves absolute ability, and if we improve absolute ability, we can increase production and make society well off. Now, this will do NOTHING to address relative inequality, because as we’re making the less academically inclined better off, we’re also making the more academically inclined at least as much better off, if not more, so inequality will, if anything, increase. But if we’re making everyone better off in absolute terms, is that a problem?
However, there’s a related issue, in that the benefits from education, to the extent we can measure them, include both absolute benefits AND relative benefits, and which of these predominate is going to be hugely relevant for how important we view investment in education. For example, people who go to college earn higher wages; that’s at least partly because going to college increases absolute ability, but it’s ALSO because going to college (particularly a prestigious, selective college) lets you reveal yourself as the sort of academically high-achieving person who can get into and graduate from college. The more the benefit of going to college is the former (increasing absolute ability), the more we can make everyone better off by sending more people to college (even if this doesn’t address inequality). The more it’s the latter (just revealing intrinsic ability), the more sending more people to college doesn’t really help, even in an absolute sense. I referred specifically to college in this example, but the same logic can apply down the line to any sort of educational investment.
One of the issues with your line of argument in your second paragraph is that you're merging academic ability and things that correlate with income and career success. They overlap but are not the same. The higher wages via college, as Freddie notes in the post, are not overwhelmingly based on ability but rather because of restricted supply and demand.
It doesn’t make sense to say the higher wages from college are based on “restricted supply and demand”. Yeah, there’s a restricted supply of people with Harvard degrees, but (unless I’m hugely mistaken) there are far fewer people who subscribe to this newsletter. You can’t go and get a wage premium for being a subscriber to this newsletter, even though the supply is way more restricted than Harvard degrees, because subscribing to the newsletter doesn’t indicate increased academic ability (admittedly it’s more complicated than that, because subscribers here probably ARE more academic accomplished than average, but it’s not a credential an employer recognizes. If it were, everyone would pay $5 a month to sign up and get the wage premium, and then the premium would disappear). Employers are willing to pay more for college graduates because they believe the average college graduate has higher ability than the average non-college graduate. Absent that belief, there would be no premium, no matter how restricted the supply is.
And the guy with the Harvard degree probably has more ability than the guy with no degree. But if everyone got a Harvard degree, the financial advantage of that degree would necessarily fall to zero no matter how valuable those skills are in real-world terms because the market would be saturated and there would be no market advantage.
While, as I indicated, I largely agree with your analysis of the situation, every time you starting talking about a market being “saturated”, I, as an economist, start to go, “Ehhhh....” Like, to the extent that having a Harvard degree increases absolute ability (and assuming ability is related to job productivity), if everyone got a Harvard degree the absolute financial advantage of having one WOULD still exist, because the fact that everyone is getting this increased absolute ability would make everyone more productive, increase total income, and make everyone better off (yes, there are potential distributional objections there, but that would start to get things far afield). To the extent that the Harvard degree is about signalling how much talent you went in with (and to be clear, I believe this is the large majority of what the degree is about), then yes, the advantage of having the degree falls to zero when everyone has one, but NOT because the market is “saturated”; rather, because it ceases to be a signal of ability when everyone has one, regardless of their ability.
I guess then that it is useful to reiterate that my objection to the idea of everyone getting a college education is an attempt to address the implied consensus way in which education will solve economic problems; everyone is not going to get a college education. But to acknowledge that would be to acknowledge that some people will be "left behind," which the system also tells us we shouldn't stand for.
I don't totally understand your response. I was restating what Freddie cited in his post, namely that wage premiums for college graduates would not be available to everyone if suddenly everyone had a degree. There is a limited number of "good" jobs. We choose to use education as the sorting mechanism for those good jobs, whether or not academic skill is actually useful for that calculation.
So there’s two possible worldviews here. One is that, as you say, there’s a limited number of “good” jobs, and the fact that a job is good is entirely a function of the job itself, and has nothing to do with who has the job. So if we take someone, no matter their underlying ability, and give them a good job, they make a lot of money. We need to pick some subset of the population to get the good jobs, so we pick the people with more education, but that’s an arbitrary choice.
The other point of view is that good jobs earn a lot of money because they produce a lot, and they produce a lot because high ability people do them. People with more education have more ability and are more productive. This could be because the education makes them more productive, or because only people who are already more productive get more education. Either way, the people with education are, on average, more productive, and that’s why they make more money. If education doesn’t actually reveal anything about ability, this falls apart.
Obviously, I lean more towards the second worldview, but I will grant that a number of jobs really do look more like first worldview.
I agree that there are some jobs at different ends of the spectrum you've described, but I suspect far fewer jobs are based on merit/ability than expected - especially, to the point what Freddie wrote, academic ability / intelligence. This is the issue I pointed out earlier: non-cognitive behavioral factors, group relationships, personality/motivation, race, and so on are all required (in addition to intelligence and academic talent) to make a robust correlation for income and intergenerational wealth.
Even if going to college does increase absolute ability, there are going to be limits to the individual gains if that ability doesn't have a good way to express itself / there's not economic demand for the labor. If half of America becomes a doctor, we have a society filled with very smart people with high levels of absolute ability. And it's a great society for someone who needs to go to the doctor. But most people won't be able to make a living selling medical services in that world and some of those people who can perform heart surgery still might have to be taxi drivers.
This is a fair point, but ultimately it’s about the substitutability of “ability” more generally. If education can only increase absolute ability specifically in the topics you learn about, then yes, if everybody gets a medical degree, the marginal utility of additional doctors gets driven way down and so does the wage premium of a medical degree. But if education increases absolute ability more generally, such that you learn skills which can suit a range of professions, this is less of an issue.
I think the 'being college educated might give you absolute ability for a range of professions' idea is broadly true.
But while the range of professions is broader than 'just doctors', it still only covers a subset of the job market. And I think the range has already been more than covered by the current supply of college graduates, which is why we increasingly see college educated people in jobs that definitely don't require what we're calling 'college absolute ability'.
I interpret that latter fact as mostly demonstrating that college is more about revealing intrinsic ability than increasing absolute ability, and as more people go to college, it does a worse job of the former.
I also agree with that. But I think it should be self-evident that there are millions of jobs out there - operating a vehicle, anything based on selling your physical labor, retail etc. - that don't have room to ever be done more efficiently by using skills or knowledge you can receive from a college professor. So even in a world where college clearly did increase absolute ability, there will still be hot dog vendors who could never translate that absolute ability gain into productivity. Perhaps you believe that the range of professions that can benefit from this absolute ability gain is larger group than I do, but it should be clear that it's never going to be 100% of the job market and thus there's a ceiling somewhere.
The school system is one of those weird areas where everyone agrees that the current approach isn't very good. I doubt you could find anyone to support the way we do it now, not even any particular aspect of it (forget funding and zip codes and class size and whatever for a second - does anyone think that throwing kids into school at 7 AM and making them sit still for eight hours is a great approach? Even I hated it and I was a good student.) It's like the prison system. Nobody thinks our schools or prisons are good enough, but they're both too scary to reform. What if we lose a generation by screwing with them? So we're stuck with systems that were the best our ancestors could come up with.
It's scarier now that I have skin in the game, with our 5 year old son about to move on to first grade. My wife and I are debating whether to keep him in kindergarten another year.
You don't really address this in the article. If we were to go strictly by what percentile he'll graduate at, it sounds like we should definitely keep him back, no? Give him an extra year to catch up? His academic skills are pretty average; like a lot of boys he's behind on social development; his birthday also makes him the youngest in the grade. I don't particularly want to decide based on this, but it's what we've got.
Would he be a happier child if he had another year in kindergarten? Would he be more socially developed and fulfilled? Would it be easier on you and his mother? Those are the questions you should decide based on, what's right for him in "soft skills" and simple comfort and happiness. You can't do a ton to change his quantitative outcomes; someday he'll take the SAT and he'll get what he gets and the best evidence is that the various choices you make as a parent won't have a big influence either way. So don't stress about it. Worry about what you can control. Have you asked him if he wants to stay in kindergarten?
I showed my wife your response. Thanks for it, Freddie. She was very impressed and is reading the article.
It's difficult to say whether he'd be happier, but our instinct is probably yes, in the sense that he'd be more uncomfortable moving on - he needs a little more social development to be on par with his peers. It seems to be mostly a function of age. Like I said, he's the youngest, and is having difficulty keeping up physically and emotionally with the other kids (academically he's in the middle of the pack).
She is adamantly opposed to asking him if he'd like to move on the first grade. I'm not against it, but I think her arguments are sound. First, he doesn't actually know anything about first grade, so I'm not sure how he could make that judgment (he WILL know that his two good friends moved on while he didn't, and he's not going to like that at all, though that will be mitigated somewhat by them being in different school systems from here out). Second, if we do decide to hold him in kindergarten, we can spin it pretty easily as a requirement rather than a choice (again, the age thing. Relatedly, we had intended to give him another year of nursery school, but it was cancelled because of the pandemic. It was kindergarten or nothing. Admittedly he surpassed our expectation in K this year. I'm proud of him).
She has other concerns, though, that go against the spirit of what you're saying here, and which I somewhat agree with. She's a school teacher, and we've got lots of school teacher friends. Two friends of ours work in remedial math and reading, and they both point out that year after year their classes are almost entirely made up of (1) boys who (2) were born in November or December. Yes, shifting that around doesn't change the price of fish: if you hold back all November and December children the remedial classes will be made up of boys born in October. But we're not operating at that high level; I just don't want my son in that situation if it could be ameliorated by another year of kindergarten.
I don't really give a shit about the ivies or any other name brand school. I'm praying fervently that there is a massive change in the way we look at college in the next ten or fifteen years, and it stops being this ridiculously over-hyped "necessity". We've got two others coming down the pike after him and it would be nice if they all didn't have to spend the first eighteen years of life fighting for increasingly pointless accolades.
Sorry for this wall of text. Thanks for listening, and any other thoughts would be enormously valuable to us. We're sick over this.
As someone who was moved to a higher grade probably a year earlier than appropriate (third grade to fifth - immigration related) and suffered greatly as a result for years afterwards due to social underdevelopment, I would urge you to more strongly consider letting him stay another year.
Looking back on it I feel that the delayed social development relative to peers was the primary cause of my problems, and I really can't come up with any counterbalancing intrinsic benefit to not having stayed that extra year. There are some extrinsic benefits that don't involve the child, like the savings to the family for skipping what amounts to an extra year of childrearing over the whole K-12 timespan, but many parents don't consider that a practical blocker (mine did not, when we discussed this more than a decade later). The benefits are truly marginal; being "ahead" by one year in terms of age will not make him any more competitive because almost all meaningful academic measures ask what grade a student is in, not their actual age, and a variance of one year is unlikely to draw any attention whatsoever. Meanwhile not having the requisite level of social development is likely to make a child extremely miserable; looking back on my own social development even far beyond that timespan, into my college years, I always wish that at the time of my worst mistakes I had been just a year older and a year more experienced. I turned out alright, but I also don't believe I gleaned any benefit whatsoever from being ahead one year in early childhood.
I guess it comes down to: think very critically about what the actual benefit of having your son "ahead" one year are, weighed against the possible impact on his comfort and happiness for several years in childhood. I am of course biased and don't have an understanding of your precise family situation, but if the decision is focused on your son's intrinsic development rather than practical issues relating to family situation, I would be unable to come up with anything at all for the former.
This is tremendously helpful. Thank you. And sorry you went through that. School is enough of a hell without making it more difficult.
We've been talking about it all day (all day again, I should say - you can imagine that this is a constant discussion). We're pretty close to taking your advice. I guess my biggest remaining concern would be that it would hurt his self-esteem to know that he was held back. But he's very young; maybe I'm reading too much of an adult perspective into the event.
Oh, becoming Finland wouldn't work, either. Finland has a talent distribution too, and those at the bottom of it suffer as our children do. The fact that Finland's absolute performance is better than ours is nice and advantages its people when they go out into the broader world, but it doesn't change the fact that the basic conception of social justice most people have doesn't work any better in Finland than anywhere else.
Oh I agree with the etiology/argument of your book -- was just wondering if there's a solution other than "America becomes socialist" / "billionaires help to pass laws to tax themselves out of existence", which seems unlikely. Maybe higher minimum wage laws, etc.? Some other mechanism?
The US doesn't need to become socialist, or tax billionaires out of existence, it just needs to raise the lower level so that "those at the bottom" can have fulfilling lives. The US was a lot more like this 70 years ago (for various complicated reasons) when there were strong labor unions. Yes, this will mean much higher taxes on billionaires (and most everybody else, definitely including me). The problem is getting the billionaires to agree, since they run things. 70 years ago, they were much more signed on to this idea ("a car in every garage").
Something I feel like is being tangled up in the analysis, however, is that the correlation between intelligence (heritable or not) and financial success independent of schooling and SES is less strong than most would think, and it is another reason that the liberal project breaks down. I'm not sure why you didn't mention this except for want of space. (I'm excluding the Robertson paper you cited, which seemed to be about only the most intelligent.)
Bowles et al (2001) found intergenerational correlation of IQ scores on income as 0.15, and a meta-analysis by Strenze (2007) found a less stark but still unimpressive correlation of 0.23. This leaves a lot of room for the continued Marxist critique of the modern educational project: schools influence culture, behavior, and create reward structures and systems that strengthen and replicate the economic/political structures on which they are based. The prep schools you mention are providing students with signals, skills, and networks - not a better absolute educational outcome, as you note.
Freddie, this is probably the most important post you’ve ever written, or that anyone has written on this subject. You are incredibly brave to do it. I am not optimistic that the educrats, the policy wonks, the social justice crowd, the media industry, and millions of well-meaning citizens will be prepared to acknowledge the truth of what you’ve said any time soon. Abilities differ, and we can’t do much about it. I am sure we are in for many more rounds of policy prescriptions, some (or many) of which will be dreadful. Please keep hammering away at this.
I don't disagree with some of these points. However, my 4th through 7th grade participation in a gifted program in the 70s was very positive in many ways. Academically, , the main benefit was a very high level of enrichment way beyond grade level. Also, we finished the mandated curriculum so fast we were able to spend a lot of time doing activities in the community and a lot more time on the spirt field...
Thank you for writing this. But please don't call meritocratic/test-driven schooling "Nietzschean". Nietzsche would have hated our current system. Check out his "Anti-Education".
I'm a garden-variety Biden supporting STEM college professor Democrat dweeb, age 65, and it's been obvious to me for decades that simple redistribution is the only thing that works. It's just blindingly obvious. OF COURSE some people are better at this-or-that stuff than others. The hard part is creating a social message that redistribution is good.
i quite like your posts on all this, i also loved your book as well. there is some good wisdom to be had from a few films (wargames) the only way to win is not to play, a few actors (lily tomlin) The trouble with the rat race is that even if you win, you're still a rat. Most places don't care where you went to school, i went to a community college then a university without walls where i designed my own degree. i did it to become educated, not to be schooled. and i studied with some of the great elders of my era, from buckminster fuller to elizabeth kubler ross. it was, i admit, a different era, long before Reagan and the whole neoliberal thing. but still, the only way to win is not to play. life outside the rat race is possible, and you know what, there are flowers out there, that bloom for only those who have left the concrete of schoolrooms and the sidewalks laid down by the elite.
Freddie, thank you for the article. Happy I subscribe to you!
Is it possible when making racial comparisons to include Asian and Hispanics, not just black/white. This happens again and again everywhere. Asian and Hispanics combined are twice the percentage as blacks.
Your proposed solution is to transfer money from people who make a lot of money to benefit people who make a little or no money. I am sympathetic: yes, let's have people who benefit greatly from the current system support people who don't.
To that effect, I recommend that when you consider the current state of income inequality in US, you look at the data that includes the transfers of money that the government already implements, in the form of income taxes (taking money away from those who get a lot) and benefits for people who earn little.
The US Census Bureau (whose data is used in that Gini index of income inequality, for example) does not account for most of these transfers already in place. Here's what the US Census Bureau says about their measurement of income:
"Census money income is defined as income received on a regular basis (exclusive of certain money receipts such as capital gains) before payments for personal income taxes, social security, union dues, medicare deductions, etc. Therefore, money income does not reflect the fact that some families receive part of their income in the form of noncash benefits, such as food stamps, health benefits, subsidized housing, and goods produced and consumed on the farm."
Here's a recent study that accounts for these omitted transfers, and finds that the Gini index is no worse than in the 1970's: https://www.cato.org/policy-analysis/reassessing-facts-about-inequality-poverty-redistribution . Here's the key graph from that study that summarizes their results: https://imgur.com/PEK50mu . Maybe the economists can effectively critique some of the methods of this study, but at least that's better than not accounting for many of the current transfers at all.
If we focus on the measures of income that include the current transfers, then we can disambiguate two separate questions: (a) are the current transfers large enough, and (b) are the ways those transfers currently happen effective.
I've been running together in my mind your line of argumentation and Bryan Caplan's from The Case Against Education. To summarize a point I'm taking from him, we could dramatically reduce the scope of expectations from schools (i.e., focus them on core competencies and what in fact prepares students for what's next) and get the same or better results with less money. If true, we could greatly streamline what school is, reducing the cost significantly and the amount of time required for most kids. This keeps money in the pockets of those who need it and frees up time for kids to do many other things. Maybe parents (of sufficient means) would fill that extra time with differentiators for their kids, just as many try to do with what time kids have now. But perhaps we shouldn't worry about that so much.
Separately and not a criticism. I have read in the last year or so research showing that GPA is a better predictor of college success than SAT.
It had never freakin'well OCCURRED to me that any but the looniest of the looney left (I am from the land of Jeremy Corbyn and Michael Foot, too) could think that education would make a silk purse out of a sow's ear. In particular, I'm sure they didn't think it would improve the intelligence (or other qualities) of a conservative. What I do think they thought was that academic ability had become roughly uncorrelated with social class and economic status, so that there were ripe fruit waiting to be picked by providing a full education to children of working class parents. It was not absurd to think so, at the time and place where I was born.
Trouble was, after one generation of this, there were not many ripe fruit left on the tree, and economic mobility slowed down. Which drove the leftists batty.
https://youtu.be/OXj8mtUsyt4?t=60
Great post, Simpsons all over this in 1990.
I’m interested in what this means in terms of human capital. Is human capital only a thing in the absolute sense, that in aggregate humans gain knowledge and skills over time, especially in schools? Or are there relative accumulations of human capital, too?
I think there's both. I don't know how to code, I learn to code, coding has monetary and social value in our society, now I've made an absolute gain in human capital - I have something to sell I didn't have before. And of course all the people who I was like before in not knowing how to code have fallen down the human capital latter a little bit because I have climbed.
It's interesting to ask how this works. Imagine a society just like ours but with everyone significantly smarter--the people who would be average in our world are in the bottom 15% in that world. (This is more-or-less what the Flynn effect has done if you think those IQ gains represent real gains in intelligence.)
It's clear that if any of us were moved into that world, our position would probably be worse--maybe here and now you're in the top 15% and there you're dead average. A person who can get into a magnet school or Ivy here has no chance there--he's just massively outcompeted.
And yet, it sure seems like that world is going to be a lot richer and better off than our world over time. Scientific breakthroughs that are just a little too hard to manage here happen there; everyone from the surgeons to the car mechanics to the janitors is a bit cleverer and so does a little better at their jobs. If you could push a button and move yourself to a world where that shift happened 30 years ago, it would be an interesting question whether you'd want to do it. You personally would move down in status relative to others, like a really clever engineer who went to work at the Manhattan project and found himself the dumbest guy in the room most of the time. But the world you moved to would be much richer and most things would probably work better--doctors would be able to cure more diseases, technology would work better, etc.
I love this. I don't have anything else to add, but this is the post that convinced me to subscribe.
This is a really good post.
I feel like almost everyone misses the absolute vs relative issue. Our schools work well enough that almost everyone can read--that's an absolute benefit of education. Most employers can assume their employers can read warning signs (perhaps in Spanish instead of English), do basic arithmetic, etc., and that extends the range of what kind of work can get done and how hard it is to do. Running a similar jobsite in a society where most of the workers can't read is going to be quite different. Absolute improvements in education are a positive-sum change--assuming the extra stuff learned is useful, the pie gets bigger.
OTOH, changing the relative educational performance of one person or group relative to another is zero-sum. If 10% of the kids coming out of high school knew calculus in 1990, and 10% do today, the society is no better off (the pie will be no bigger) if we've swapped things around so that more of those kids are black in 2021, but fewer are white. In terms of what work can get done, what benefit did we get?
For group differences, I think the underlying mental model is that the kids in the underperforming group are being held back by something (current racial discrimination, stigma against "acting white," alien space bats, whatever), and there's some educational reform that would stop holding them back, and then we'd see the underperforming kids get more absolute education, leading to a change in relative rankings. And as I understand it (way less than Freddie does--this isn't my field at all!), attempts to change schools to accomplish this, at least for the black/white gap, have just been a steady string of failures or one-off successes that couldn't be replicated. Whatever is holding those kids back, it seems like it's not something easy for schools to fix.
But that relative inequality is a big political problem. Even if we improve education so that 10% of kids knew calculus in 1990 and 20% of kids know calculus in 2020, if black kids or poor kids or kids from whatever other group still end up underrepresented, a lot of people will think that there hasn't been any progress--you may have taught more kids calculus, but you didn't solve the problem *they* were worried about.
I think there’s a couple of things going on. Part of it is whether to emphasize relative vs. absolute outcomes in terms of what we’re trying to accomplish. I largely agree with this post, but I think the steelmanned argument against would be to say, hey, we seem to agree that education improves absolute ability, and if we improve absolute ability, we can increase production and make society well off. Now, this will do NOTHING to address relative inequality, because as we’re making the less academically inclined better off, we’re also making the more academically inclined at least as much better off, if not more, so inequality will, if anything, increase. But if we’re making everyone better off in absolute terms, is that a problem?
However, there’s a related issue, in that the benefits from education, to the extent we can measure them, include both absolute benefits AND relative benefits, and which of these predominate is going to be hugely relevant for how important we view investment in education. For example, people who go to college earn higher wages; that’s at least partly because going to college increases absolute ability, but it’s ALSO because going to college (particularly a prestigious, selective college) lets you reveal yourself as the sort of academically high-achieving person who can get into and graduate from college. The more the benefit of going to college is the former (increasing absolute ability), the more we can make everyone better off by sending more people to college (even if this doesn’t address inequality). The more it’s the latter (just revealing intrinsic ability), the more sending more people to college doesn’t really help, even in an absolute sense. I referred specifically to college in this example, but the same logic can apply down the line to any sort of educational investment.
One of the issues with your line of argument in your second paragraph is that you're merging academic ability and things that correlate with income and career success. They overlap but are not the same. The higher wages via college, as Freddie notes in the post, are not overwhelmingly based on ability but rather because of restricted supply and demand.
It doesn’t make sense to say the higher wages from college are based on “restricted supply and demand”. Yeah, there’s a restricted supply of people with Harvard degrees, but (unless I’m hugely mistaken) there are far fewer people who subscribe to this newsletter. You can’t go and get a wage premium for being a subscriber to this newsletter, even though the supply is way more restricted than Harvard degrees, because subscribing to the newsletter doesn’t indicate increased academic ability (admittedly it’s more complicated than that, because subscribers here probably ARE more academic accomplished than average, but it’s not a credential an employer recognizes. If it were, everyone would pay $5 a month to sign up and get the wage premium, and then the premium would disappear). Employers are willing to pay more for college graduates because they believe the average college graduate has higher ability than the average non-college graduate. Absent that belief, there would be no premium, no matter how restricted the supply is.
And the guy with the Harvard degree probably has more ability than the guy with no degree. But if everyone got a Harvard degree, the financial advantage of that degree would necessarily fall to zero no matter how valuable those skills are in real-world terms because the market would be saturated and there would be no market advantage.
While, as I indicated, I largely agree with your analysis of the situation, every time you starting talking about a market being “saturated”, I, as an economist, start to go, “Ehhhh....” Like, to the extent that having a Harvard degree increases absolute ability (and assuming ability is related to job productivity), if everyone got a Harvard degree the absolute financial advantage of having one WOULD still exist, because the fact that everyone is getting this increased absolute ability would make everyone more productive, increase total income, and make everyone better off (yes, there are potential distributional objections there, but that would start to get things far afield). To the extent that the Harvard degree is about signalling how much talent you went in with (and to be clear, I believe this is the large majority of what the degree is about), then yes, the advantage of having the degree falls to zero when everyone has one, but NOT because the market is “saturated”; rather, because it ceases to be a signal of ability when everyone has one, regardless of their ability.
I guess then that it is useful to reiterate that my objection to the idea of everyone getting a college education is an attempt to address the implied consensus way in which education will solve economic problems; everyone is not going to get a college education. But to acknowledge that would be to acknowledge that some people will be "left behind," which the system also tells us we shouldn't stand for.
I don't totally understand your response. I was restating what Freddie cited in his post, namely that wage premiums for college graduates would not be available to everyone if suddenly everyone had a degree. There is a limited number of "good" jobs. We choose to use education as the sorting mechanism for those good jobs, whether or not academic skill is actually useful for that calculation.
So there’s two possible worldviews here. One is that, as you say, there’s a limited number of “good” jobs, and the fact that a job is good is entirely a function of the job itself, and has nothing to do with who has the job. So if we take someone, no matter their underlying ability, and give them a good job, they make a lot of money. We need to pick some subset of the population to get the good jobs, so we pick the people with more education, but that’s an arbitrary choice.
The other point of view is that good jobs earn a lot of money because they produce a lot, and they produce a lot because high ability people do them. People with more education have more ability and are more productive. This could be because the education makes them more productive, or because only people who are already more productive get more education. Either way, the people with education are, on average, more productive, and that’s why they make more money. If education doesn’t actually reveal anything about ability, this falls apart.
Obviously, I lean more towards the second worldview, but I will grant that a number of jobs really do look more like first worldview.
I agree that there are some jobs at different ends of the spectrum you've described, but I suspect far fewer jobs are based on merit/ability than expected - especially, to the point what Freddie wrote, academic ability / intelligence. This is the issue I pointed out earlier: non-cognitive behavioral factors, group relationships, personality/motivation, race, and so on are all required (in addition to intelligence and academic talent) to make a robust correlation for income and intergenerational wealth.
Even if going to college does increase absolute ability, there are going to be limits to the individual gains if that ability doesn't have a good way to express itself / there's not economic demand for the labor. If half of America becomes a doctor, we have a society filled with very smart people with high levels of absolute ability. And it's a great society for someone who needs to go to the doctor. But most people won't be able to make a living selling medical services in that world and some of those people who can perform heart surgery still might have to be taxi drivers.
This is a fair point, but ultimately it’s about the substitutability of “ability” more generally. If education can only increase absolute ability specifically in the topics you learn about, then yes, if everybody gets a medical degree, the marginal utility of additional doctors gets driven way down and so does the wage premium of a medical degree. But if education increases absolute ability more generally, such that you learn skills which can suit a range of professions, this is less of an issue.
I think the 'being college educated might give you absolute ability for a range of professions' idea is broadly true.
But while the range of professions is broader than 'just doctors', it still only covers a subset of the job market. And I think the range has already been more than covered by the current supply of college graduates, which is why we increasingly see college educated people in jobs that definitely don't require what we're calling 'college absolute ability'.
I interpret that latter fact as mostly demonstrating that college is more about revealing intrinsic ability than increasing absolute ability, and as more people go to college, it does a worse job of the former.
I also agree with that. But I think it should be self-evident that there are millions of jobs out there - operating a vehicle, anything based on selling your physical labor, retail etc. - that don't have room to ever be done more efficiently by using skills or knowledge you can receive from a college professor. So even in a world where college clearly did increase absolute ability, there will still be hot dog vendors who could never translate that absolute ability gain into productivity. Perhaps you believe that the range of professions that can benefit from this absolute ability gain is larger group than I do, but it should be clear that it's never going to be 100% of the job market and thus there's a ceiling somewhere.
Thanks Freddie. Another excellent article.
The school system is one of those weird areas where everyone agrees that the current approach isn't very good. I doubt you could find anyone to support the way we do it now, not even any particular aspect of it (forget funding and zip codes and class size and whatever for a second - does anyone think that throwing kids into school at 7 AM and making them sit still for eight hours is a great approach? Even I hated it and I was a good student.) It's like the prison system. Nobody thinks our schools or prisons are good enough, but they're both too scary to reform. What if we lose a generation by screwing with them? So we're stuck with systems that were the best our ancestors could come up with.
It's scarier now that I have skin in the game, with our 5 year old son about to move on to first grade. My wife and I are debating whether to keep him in kindergarten another year.
You don't really address this in the article. If we were to go strictly by what percentile he'll graduate at, it sounds like we should definitely keep him back, no? Give him an extra year to catch up? His academic skills are pretty average; like a lot of boys he's behind on social development; his birthday also makes him the youngest in the grade. I don't particularly want to decide based on this, but it's what we've got.
Would he be a happier child if he had another year in kindergarten? Would he be more socially developed and fulfilled? Would it be easier on you and his mother? Those are the questions you should decide based on, what's right for him in "soft skills" and simple comfort and happiness. You can't do a ton to change his quantitative outcomes; someday he'll take the SAT and he'll get what he gets and the best evidence is that the various choices you make as a parent won't have a big influence either way. So don't stress about it. Worry about what you can control. Have you asked him if he wants to stay in kindergarten?
I showed my wife your response. Thanks for it, Freddie. She was very impressed and is reading the article.
It's difficult to say whether he'd be happier, but our instinct is probably yes, in the sense that he'd be more uncomfortable moving on - he needs a little more social development to be on par with his peers. It seems to be mostly a function of age. Like I said, he's the youngest, and is having difficulty keeping up physically and emotionally with the other kids (academically he's in the middle of the pack).
She is adamantly opposed to asking him if he'd like to move on the first grade. I'm not against it, but I think her arguments are sound. First, he doesn't actually know anything about first grade, so I'm not sure how he could make that judgment (he WILL know that his two good friends moved on while he didn't, and he's not going to like that at all, though that will be mitigated somewhat by them being in different school systems from here out). Second, if we do decide to hold him in kindergarten, we can spin it pretty easily as a requirement rather than a choice (again, the age thing. Relatedly, we had intended to give him another year of nursery school, but it was cancelled because of the pandemic. It was kindergarten or nothing. Admittedly he surpassed our expectation in K this year. I'm proud of him).
She has other concerns, though, that go against the spirit of what you're saying here, and which I somewhat agree with. She's a school teacher, and we've got lots of school teacher friends. Two friends of ours work in remedial math and reading, and they both point out that year after year their classes are almost entirely made up of (1) boys who (2) were born in November or December. Yes, shifting that around doesn't change the price of fish: if you hold back all November and December children the remedial classes will be made up of boys born in October. But we're not operating at that high level; I just don't want my son in that situation if it could be ameliorated by another year of kindergarten.
I don't really give a shit about the ivies or any other name brand school. I'm praying fervently that there is a massive change in the way we look at college in the next ten or fifteen years, and it stops being this ridiculously over-hyped "necessity". We've got two others coming down the pike after him and it would be nice if they all didn't have to spend the first eighteen years of life fighting for increasingly pointless accolades.
Sorry for this wall of text. Thanks for listening, and any other thoughts would be enormously valuable to us. We're sick over this.
As someone who was moved to a higher grade probably a year earlier than appropriate (third grade to fifth - immigration related) and suffered greatly as a result for years afterwards due to social underdevelopment, I would urge you to more strongly consider letting him stay another year.
Looking back on it I feel that the delayed social development relative to peers was the primary cause of my problems, and I really can't come up with any counterbalancing intrinsic benefit to not having stayed that extra year. There are some extrinsic benefits that don't involve the child, like the savings to the family for skipping what amounts to an extra year of childrearing over the whole K-12 timespan, but many parents don't consider that a practical blocker (mine did not, when we discussed this more than a decade later). The benefits are truly marginal; being "ahead" by one year in terms of age will not make him any more competitive because almost all meaningful academic measures ask what grade a student is in, not their actual age, and a variance of one year is unlikely to draw any attention whatsoever. Meanwhile not having the requisite level of social development is likely to make a child extremely miserable; looking back on my own social development even far beyond that timespan, into my college years, I always wish that at the time of my worst mistakes I had been just a year older and a year more experienced. I turned out alright, but I also don't believe I gleaned any benefit whatsoever from being ahead one year in early childhood.
I guess it comes down to: think very critically about what the actual benefit of having your son "ahead" one year are, weighed against the possible impact on his comfort and happiness for several years in childhood. I am of course biased and don't have an understanding of your precise family situation, but if the decision is focused on your son's intrinsic development rather than practical issues relating to family situation, I would be unable to come up with anything at all for the former.
This is tremendously helpful. Thank you. And sorry you went through that. School is enough of a hell without making it more difficult.
We've been talking about it all day (all day again, I should say - you can imagine that this is a constant discussion). We're pretty close to taking your advice. I guess my biggest remaining concern would be that it would hurt his self-esteem to know that he was held back. But he's very young; maybe I'm reading too much of an adult perspective into the event.
I'm curious if you think there's a possible market solution (i.e., without becoming Finland, which seems very unrealistic for the U.S. at the moment).
Oh, becoming Finland wouldn't work, either. Finland has a talent distribution too, and those at the bottom of it suffer as our children do. The fact that Finland's absolute performance is better than ours is nice and advantages its people when they go out into the broader world, but it doesn't change the fact that the basic conception of social justice most people have doesn't work any better in Finland than anywhere else.
Oh I agree with the etiology/argument of your book -- was just wondering if there's a solution other than "America becomes socialist" / "billionaires help to pass laws to tax themselves out of existence", which seems unlikely. Maybe higher minimum wage laws, etc.? Some other mechanism?
The US doesn't need to become socialist, or tax billionaires out of existence, it just needs to raise the lower level so that "those at the bottom" can have fulfilling lives. The US was a lot more like this 70 years ago (for various complicated reasons) when there were strong labor unions. Yes, this will mean much higher taxes on billionaires (and most everybody else, definitely including me). The problem is getting the billionaires to agree, since they run things. 70 years ago, they were much more signed on to this idea ("a car in every garage").
Something I feel like is being tangled up in the analysis, however, is that the correlation between intelligence (heritable or not) and financial success independent of schooling and SES is less strong than most would think, and it is another reason that the liberal project breaks down. I'm not sure why you didn't mention this except for want of space. (I'm excluding the Robertson paper you cited, which seemed to be about only the most intelligent.)
Bowles et al (2001) found intergenerational correlation of IQ scores on income as 0.15, and a meta-analysis by Strenze (2007) found a less stark but still unimpressive correlation of 0.23. This leaves a lot of room for the continued Marxist critique of the modern educational project: schools influence culture, behavior, and create reward structures and systems that strengthen and replicate the economic/political structures on which they are based. The prep schools you mention are providing students with signals, skills, and networks - not a better absolute educational outcome, as you note.
Freddie, this is probably the most important post you’ve ever written, or that anyone has written on this subject. You are incredibly brave to do it. I am not optimistic that the educrats, the policy wonks, the social justice crowd, the media industry, and millions of well-meaning citizens will be prepared to acknowledge the truth of what you’ve said any time soon. Abilities differ, and we can’t do much about it. I am sure we are in for many more rounds of policy prescriptions, some (or many) of which will be dreadful. Please keep hammering away at this.
More grist from the mill, two days old: https://www.aera.net/Newsroom/Study-Snapshot-Do-Students-in-Gifted-Programs-Perform-Better-Linking-Gifted-Program-Participants-to-Achievement-and-Nonachievement-Outcomes
I don't disagree with some of these points. However, my 4th through 7th grade participation in a gifted program in the 70s was very positive in many ways. Academically, , the main benefit was a very high level of enrichment way beyond grade level. Also, we finished the mandated curriculum so fast we were able to spend a lot of time doing activities in the community and a lot more time on the spirt field...
Thank you for writing this. But please don't call meritocratic/test-driven schooling "Nietzschean". Nietzsche would have hated our current system. Check out his "Anti-Education".
I'm a garden-variety Biden supporting STEM college professor Democrat dweeb, age 65, and it's been obvious to me for decades that simple redistribution is the only thing that works. It's just blindingly obvious. OF COURSE some people are better at this-or-that stuff than others. The hard part is creating a social message that redistribution is good.
i quite like your posts on all this, i also loved your book as well. there is some good wisdom to be had from a few films (wargames) the only way to win is not to play, a few actors (lily tomlin) The trouble with the rat race is that even if you win, you're still a rat. Most places don't care where you went to school, i went to a community college then a university without walls where i designed my own degree. i did it to become educated, not to be schooled. and i studied with some of the great elders of my era, from buckminster fuller to elizabeth kubler ross. it was, i admit, a different era, long before Reagan and the whole neoliberal thing. but still, the only way to win is not to play. life outside the rat race is possible, and you know what, there are flowers out there, that bloom for only those who have left the concrete of schoolrooms and the sidewalks laid down by the elite.
Freddie, thank you for the article. Happy I subscribe to you!
Is it possible when making racial comparisons to include Asian and Hispanics, not just black/white. This happens again and again everywhere. Asian and Hispanics combined are twice the percentage as blacks.
(Spare us the Latinx moniker......thank you.)
Thank you for a great post!
Your proposed solution is to transfer money from people who make a lot of money to benefit people who make a little or no money. I am sympathetic: yes, let's have people who benefit greatly from the current system support people who don't.
To that effect, I recommend that when you consider the current state of income inequality in US, you look at the data that includes the transfers of money that the government already implements, in the form of income taxes (taking money away from those who get a lot) and benefits for people who earn little.
The US Census Bureau (whose data is used in that Gini index of income inequality, for example) does not account for most of these transfers already in place. Here's what the US Census Bureau says about their measurement of income:
"Census money income is defined as income received on a regular basis (exclusive of certain money receipts such as capital gains) before payments for personal income taxes, social security, union dues, medicare deductions, etc. Therefore, money income does not reflect the fact that some families receive part of their income in the form of noncash benefits, such as food stamps, health benefits, subsidized housing, and goods produced and consumed on the farm."
There is more; here's the link: https://www.census.gov/topics/income-poverty/income/about.html
Here's a recent study that accounts for these omitted transfers, and finds that the Gini index is no worse than in the 1970's: https://www.cato.org/policy-analysis/reassessing-facts-about-inequality-poverty-redistribution . Here's the key graph from that study that summarizes their results: https://imgur.com/PEK50mu . Maybe the economists can effectively critique some of the methods of this study, but at least that's better than not accounting for many of the current transfers at all.
If we focus on the measures of income that include the current transfers, then we can disambiguate two separate questions: (a) are the current transfers large enough, and (b) are the ways those transfers currently happen effective.
I've been running together in my mind your line of argumentation and Bryan Caplan's from The Case Against Education. To summarize a point I'm taking from him, we could dramatically reduce the scope of expectations from schools (i.e., focus them on core competencies and what in fact prepares students for what's next) and get the same or better results with less money. If true, we could greatly streamline what school is, reducing the cost significantly and the amount of time required for most kids. This keeps money in the pockets of those who need it and frees up time for kids to do many other things. Maybe parents (of sufficient means) would fill that extra time with differentiators for their kids, just as many try to do with what time kids have now. But perhaps we shouldn't worry about that so much.
Separately and not a criticism. I have read in the last year or so research showing that GPA is a better predictor of college success than SAT.
It had never freakin'well OCCURRED to me that any but the looniest of the looney left (I am from the land of Jeremy Corbyn and Michael Foot, too) could think that education would make a silk purse out of a sow's ear. In particular, I'm sure they didn't think it would improve the intelligence (or other qualities) of a conservative. What I do think they thought was that academic ability had become roughly uncorrelated with social class and economic status, so that there were ripe fruit waiting to be picked by providing a full education to children of working class parents. It was not absurd to think so, at the time and place where I was born.
Trouble was, after one generation of this, there were not many ripe fruit left on the tree, and economic mobility slowed down. Which drove the leftists batty.