Miles on HuffPost Live: Barack Obama Talks about the Long Run, While We Wonder about His Pick for Fed Chief

Link to HuffPost Live segment “Back to the Economy”: Mark Gongloff, Edward G. Luce and Miles Kimball, hosted by Mike Sacks

It was a little odd having two fairly disparate topics in this HuffPost Live segment: long-run issues and who the new Fed Chief should be. Here is what I talked about:

Shane Parrish on Deliberate Practice

Talent is Overrated, by Geoff Colvin

Talent is Overrated, by Geoff Colvin

In my introductory macroeconomics class, I recommend that my students read Daniel Coyle’s book The Talent Code: Greatness Isn’t Born. It’s Grown. Here’s How.(Daniel Coyle also has a website called “The Talent Code”)There are two key messages of that book, important both for gaining skill in economics and for thinking about the economics of education and economic growth: 

  1. Effort can bring skill to almost anyone.
  2. The kind of effort required is the difficult regimen of deliberate practice.

Talent is Overrated. Geoff Colvin’s book Talent is Overrated has the same two messages. Shane Parrish, in his Farnam Street blog post “What is Delieberate Practice?” ably pulls from Talent is Overrated a description of deliberate practice.

Shane begins with these two quotations from Talent is Overrated indicating the difference between deliberate practice and what most people think of when they think of practice:  

  • In field after field, when it comes to centrally important skills…parole officers predicting recidivism, college admissions officials judging applicants—people with lots of experience were no better at their jobs than those with less experience. 
  • Deliberate practice is hard. It hurts. But it works. More of it equals better performance and tons of it equals great performance.

Shane clarifies:

Most of what we consider practice is really just playing around — we’re in our comfort zone.

When you venture off to the golf range to hit a bucket of balls what you’re really doing is having fun. You’re not getting better. Understanding the difference between fun and deliberate practice unlocks the key to improving performance.

Shane then structures the rest of his post by this that Geoff Colvin says of deliberate practice:

  1. It is activity designed specifically to improve performance, often with a teacher’s help;
  2. it can be repeated a lot; feedback on results is continuously available;
  3. it’s highly demanding mentally, whether the activity is purely intellectual, such as chess or business-related activities, or heavily physical, such as sports; it isn’t much fun.

1. Deliberate practice is designed to improve performance. Teachers can help in that design. As Geoff Colvin writes: 

  • In some fields, especially intellectual ones such as the arts, sciences, and business, people may eventually become skilled enough to design their own practice. But anyone who thinks they’ve outgrown the benefits of a teacher’s help should at least question that view. There’s a reason why the world’s best golfers still go to teachers.
  • A chess teacher is looking at the same boards as the student but can see that the student is consistently overlooking an important threat. A business coach is looking at the same situations as a manager but can see, for example, that the manager systematically fails to communicate his intentions clearly.”

Shane comments:

Teachers, or coaches, see what you miss and make you aware of where you’re falling short.

With or without a teacher, great performers deconstruct elements of what they do into chunks they can practice. They get better at that aspect and move on to the next.

Noel Tichy, professor at the University of Michigan business school and the former chief of General Electric’s famous management development center at Crotonville, puts the concept of practice into three zones: the comfort zone, the learning zone, and the panic zone.

Most of the time we’re practicing we’re really doing activities in our comfort zone. This doesn’t help us improve because we can already do these activities easily. On the other hand, operating in the panic zone leaves us paralyzed as the activities are too difficult and we don’t know where to start. The only way to make progress is to operate in the learning zone, which are those activities that are just out of reach.

2. Deliberate practice can be repeated a lot, with appropriate feedback.

Shane gives these two quotations from Talent is Overrated:

  • Let us briefly illustrate the difference between work and deliberate practice. During a three hour baseball game, a batter may only get 5-15 pitches (perhaps one or two relevant to a particular weakness), whereas during optimal practice of the same duration, a batter working with a dedicated pitcher has several hundred batting opportunities, where this weakness can be systematically exploited. 
  • You can work on technique all you like, but if you can’t see the effects, two things will happen: You won’t get any better, and you’ll stop caring.

Shane points out that if results must be subjectively interpreted, it is valuable not to have to rely entirely on one’s own opinion to judge the results. A coach can provide such a second opinion. But sometimes all it takes is a friend with good judgment. 

3. Deliberate practice is highly demanding mentally and isn’t much fun. 

Shane writes

Doing things we know how to do is fun and does not require a lot of effort. Deliberate practice, however, is not fun. Breaking down a task you wish to master into its constituent parts and then working on those areas systematically requires a lot of effort.

Indeed, Geoff Colvin claims that it is hard to do deliberate practice for more than four or five hours a day, or for more than ninety minutes at a stretch. 

Deliberate practice can also be embarrassing. Shane quotes from Susan Cain’s book, Quiet: The Power of Introverts in a World That Can’t Stop Talking this claim:

  • Deliberate Practice is best conducted alone for several reasons. It takes intense concentration, and other people can be distracting. It requires deep motivation, often self-generated. But most important, it involves working on the task that’s most challenging to you personally. Only when you’re alone, Ericsson told me, can you “go directly to the part that’s challenging to you. If you want to improve what you’re doing, you have to be the one who generates the move. Imagine a group class—you’re the one generating the move only a small percentage of the time.”

Presumably, a tutorial by a good coach is even better than doing deliberate practice alone.  But some people do manage deliberate practice alone. A wonderful example is Ben Franklin.

A detailed example of deliberate practice: Ben Franklin. I remember vividly from my own reading of Talent is Overrated this passage Shane quotes about Ben’s program for improving his writing:

  • First, he found examples of prose clearly superior to anything he could produce, a bound volume of the Spectator, the great English periodical written by Joseph Addison and Richard Steele. Any of us might have done something similar. But Franklin then embarked on a remarkable program that few of us would have ever thought of.
  • It began with his reading a Spectator article and marking brief notes on the meaning of each sentence; a few days later he would take up the notes and try to express the meaning of each sentence in his own words. When done, he compared his essay with the original, “discovered some of my faults, and corrected them.
  • One of the faults he noticed was his poor vocabulary. What could he do about that? He realized that writing poetry required an extensive “stock of words” because he might need to express any given meaning in many different ways depending on the demands of rhyme or meter. So he would rewrite Spectator essays in verse. …
  • Franklin realized also that a key element of a good essay is its organization, so he developed a method to work on that. He would again make short notes on each sentence in an essay, but would write each note on a separate slip of paper. He would then mix up the notes and set them aside for weeks, until he had forgotten the essay. At that point he would try to put the notes in their correct order, attempt to write the essay, and then compare it with the original; again, he “discovered many faults and amended them.”

Other Readings. Shane recommends this New Yorker article by Dr. Atul Gawande.Many others have written online about deliberate practice, as googling the words “deliberate practice” indicates. One I stumbled across in my googling was Justin Musk’s excellent post “the secret to becoming a successful published writer: putting the deliberate in deliberate practice.”

A Plea: I would love to see more in the economics blogosphere about what deliberate practice looks like for gaining skill in economics.

Glenn Ellison's New Book: Hard Math for Elementary School

Glenn Ellison's Hard Math for Elementary School

Glenn Ellison's Hard Math for Elementary School

Glenn Ellison, the microeconomic theorist at MIT, has written a new book for kids who love math. Here is what Susan Athey had to say about it on her Facebook page, and gave me permission to post:

If your elementary school kids love math–this truly unique book is for you. There’s enough material in here to run a math club for two years, at least. It is really inspiring to see what happens when someone with deep love of math, an incredible gift for teaching, and years of experience with coaching kids in math teams and working with his three brilliant daughters comes up with when he puts his mind to it! Thanks so much for sharing what you’ve created with the rest of us, Glenn Ellison! (And I can’t believe you managed to get this done on top of everything else you are doing!)

My Ec 10 teacher Mary O'Keeffe also gave a rave review of the book on her math circle blog.

Susan pointed out that Glenn also has a book for older kids, Hard Math for Middle School.

Jonah Berger: Going Viral

Kindle link for Jonah Berger's Contagious

Kindle link for Jonah Berger's Contagious

Like many other readers, I was fascinated by Richard Dawkins introduction of the idea of a meme in his book The Selfish Gene.

Wikipedia gives a good discussion of memes:

A meme (/ˈmiːm/; meem)[1] is “an idea, behavior, or style that spreads from person to person within a culture.”[2] A meme acts as a unit for carrying cultural ideas, symbols, or practices that can be transmitted from one mind to another through writing, speech, gestures, rituals, or other imitable phenomena. Supporters of the concept regard memes as cultural analogues to genes in that they self-replicate, mutate, and respond to selective pressures.[3]

The word meme is a shortening (modeled on gene) of mimeme (from Ancient Greek μίμημα Greek pronunciation: [míːmɛːma]mīmēma, “imitated thing”, from μιμεῖσθαι mimeisthai, “to imitate”, from μῖμος mimos "mime")[4] and it was coined by the British evolutionary biologist Richard Dawkins in The Selfish Gene (1976)[1][5] as a concept for discussion of evolutionary principles in explaining the spread of ideas and cultural phenomena. Examples of memes given in the book included melodies, catch-phrases, fashion, and the technology of building arches.[6]

Proponents theorize that memes may evolve by natural selection in a manner analogous to that of biological evolution. Memes do this through the processes of variation, mutation, competition, and inheritance, each of which influence a meme’s reproductive success. Memes spread through the behavior that they generate in their hosts. Memes that propagate less prolifically may become extinct, while others may survive, spread, and (for better or for worse) mutate. Memes that replicate most effectively enjoy more success, and some may replicate effectively even when they prove to be detrimental to the welfare of their hosts.[7]

A field of study called memetics[8] arose in the 1990s to explore the concepts and transmission of memes in terms of an evolutionary model.

Internet memes are a subset of memes in general. Wikipedia has a good discussion of this particular subset of memes as well:

An Internet meme may take the form of an image, hyperlink, video, picture, website, or hashtag. It may be just a word or phrase, including an intentional misspelling. These small movements tend to spread from person to person via social networks, blogs, direct email, or news sources. They may relate to various existing Internet cultures or subcultures, often created or spread on sites such as 4chan, Reddit and numerous others.

An Internet meme may stay the same or may evolve over time, by chance or through commentary, imitations, parody, or by incorporating news accounts about itself. Internet memes can evolve and spread extremely rapidly, sometimes reaching world-wide popularity within a few days. Internet memes usually are formed from some social interaction, pop culture reference, or situations people often find themselves in. Their rapid growth and impact has caught the attention of both researchers and industry.[3]Academically, researchers model how they evolve and predict which memes will survive and spread throughout the Web. Commercially, they are used in viral marketing where they are an inexpensive form of mass advertising.

But sometimes our image of an internet meme is too narrow. A tweet can easily become an internet meme if it is retweeted and modified. Thinking of bigger chunks of text, even a blog post sometimes both spreads in its original form and inspires other blog posts that can be considered mutated forms of the original blog post. And thinking just a bit smaller than a tweet, a link to a blog post can definitely be a meme, coevolving with different combinations of surrounding text recommending or denigrating what is at the link–sometimes just the surrounding text of a tweet and sometimes the surrounding text of an entire blog post that flags what is at the link. So those of us who care how many people read what we have to say have reason to be interested in the principles that determine when tweet, a post or a link will be contagious or not. In other words, what does it take to go viral?

Jonah Berger’s book Contagious gives answers based on research Jonah has done as a Marketing professor at the Wharton school. Jonah identifies six dimensions of a message that make it more likely to spread. Here are my notes what Jonah has to say about those six dimensions, for which Jonah gives the acronym STEPPS:

1. Social Currency: We share things that make us look good.

Jonah emphasizes three ways to make people want to share something in order to look good.

  • Inner Remarkability: making clear how remarkable something is. Two examples of remarkabilility are the Snapple facts on the inside of Snapple lids and the video series “Will It Blend?” showing Blendtec blenders grinding up just about anything, the more entertaining the better. Note how what is remarkable about the Blendtec blenders is brought out and dramatized in a non-obvious and entertaining way.  
  • Leverage Game Mechanics: Make a good game out of being a fan.  Here the allure of becoming the Foursquare mayor of some establishment is a great example. 
  • Make People Feel Like Insiders: Here, counterintuitively, creating a sense of scarcity, exclusivity, and the need for inside knowledge to access everything, can make something more attractive. Of course, if you can get away with the illusion of scarcity and exclusivity rather than the reality, more people can be brought on board.

2. Triggers: Top of mind, tip of tongue.

Here the key idea is to tie what you are trying to promote to some trigger that will happen often in someone’s environment.

  • Budweiser’s “Wassup” campaign might seem uninspired, but it tied Budweiser beer to what was a common greeting at the time among a key demographic of young males.  
  • The “Kitkat and Coffee” campaign tied Kitkat chocolate bars to a very frequent occurrence in many people’s days: drinking coffee.
  • The lines “Thinking about Dinner? Think About Boston Market” helped trigger thoughts of Boston Market at a time of day at which they hadn’t previously had as much business.  
  • The trigger can even be the communications of one’s adversary, as in the anti-smoking ads riffing off of the Marlboro Man commercials:

3. Emotion: When we care, we share.

The non-obvious finding here is that high arousal emotions such as 

–regardless of whether they are positive or negative–encourage sharing more than low arousal emotions such as contentment and sadness. Indeed, arousal is so important for sharing, experiments indicate that even the physiological arousal induced by making people run in place can cause people to share an article more often.

To find the emotional core of an idea, so that emotional core can be highlighted, Jonah endorses the technique of asking why you think people are doing something, then asking “why is that important” three times. Of course, this could also be seen as a way to try to get at the underlying utility function: utility functions are implemented in important measure by emotions. 

Jonah recommends Google’s “Paris Love” campaign as an example of showing how to demonstrate that something seemingly prosaic, such as search, can connect to deeper concerns. 

4. Public: Built to show, built to grow.

Here I like the story of how Steve Jobs and his marketing expert Ken Segall decided that making the Apple log on a laptop look right-side up to other people when the laptop is in use was more important than making it look right-side up to the user at the moment of figuring out which way to turn to laptop to open it up. Jonah points out how the way the color yellow made them stand out helped make Livestrong wristbands a thing in the days before Lance Armstrong was disgraced

and how the color white made ipod headphones more noticeable than black would have. 

Jonah also makes interesting points about how talking about certain kinds of bad behavior, by making it seem everyone is doing it, can actually encourage bad behavior. Think of Nancy Reagan’s “Just Say No” antidrug campaign:

An alternative is to try to highlight the alternative, desired behavior.  

5. Practical Value: News you can use.

This dimension is fairly straightforward. But Jonah gives this interesting example of a video about how to shuck corn for corn on the cob that went viral in an older demographic where not many things go viral. He also points to the impulse to share information of presumed practical value as part of the reason it is so hard to eradicate the scientifically discredited idea that vaccines cause autism.

6. Stories: Information travels under the guise of idle chatter. 

Here, Jonah uses the example of the Trojan horse, which works well on many levels: the horse brought Greek warriors into Troy, and the story of the Trojan horse brings the idea “never trust your enemies, even if they seem friendly” deep into the soul. He points out just how much information is carried along by good stories.

But Jonah cautions that to make a story valuable, what you are trying to promote has to be integral to the story. Crashing the Olympics and doing a belly flop makes a good story, but the advertising on the break-in diver’s outfit was not central to the story and was soon forgotten. By contrast, for Panda brand Cheese, the Panda backing up the threat “Never say no to Panda” is a memorable part of the stories of Panda mayhem in the cheese commercials, and Dove products at least have an integral supporting role to play in Dove’s memorable Evolution commercial illustrating the extent to which much makeup and photoshopping are behind salient images of beauty in our environment.   

Applied Memetics for the Economics Blogger

Here are a few thought about how to use Jonah’s insights in trying to make a mark in the blogosphere and tweetosphere.

1. Social Currency

Inner Remarkability: I find the effort to encapsulate the inner remarkability of each post or idea in a tweet an interesting intellectual challenge. One good way to practice this is a tip I learned from Bonnie Kavoussi: try to find the most interesting quotation from someone else’s post and put that quotation in your tweet. That will win you friends from the authors of the posts, earn you more Twitter followers (remember that the author of the post will have a strong urge to retweet if you are advertising herhis post well), and hone your skills for when you want to advertise your own posts on Twitter. 

Leverage Game Mechanics: In the blogosphere and on Twitter, we are associating with peers. Much of what they want is similar to what w want–to be noticed, to get our points across, to get new ideas. So helping them to win their game is basically a matter of being a good friend or colleague. For example, championing people’s best work and being generous in giving credit will win points. 

Make People Feel Like Insiders: When writing for on online magazine (Quartz in my case), it feels I need to write as if the readers are reading me for the first time. By contrast, a blog is tailor-made to make readers feel like insiders. So it is valuable to have an independent blog alongside any writing I do for an online magazine.  

2. Triggers

A common piece of advice to young tenure-track assistant professors is to do enough of one thing to become known for that thing. This is consistent with Jonah’s advice about triggers. Having people think of you every time a particular topic comes up is a good way to make sure people think of you. That doesn’t mean you need to be a Johnny-one-note, but it does mean the danger of being seen as a Johnny-one-note is overrated. Remember that readers can easily get variety by diversifying their reading between you and other bloggers. So they will be fine even if your blog specializes to one particular niche, or a small set of niches.

On Twitter, one way to associate yourself with a particular trigger is to use a hashtag. In addition to the hashtag #ImmigrationTweetDay that Adam Ozimek, Noah Smith and I created for Immigration Tweet Day, I have made frequent use of the hashtag #emoney, and I created the hashtag #nakedausterity.  

3. Emotion

Economists often want to come across as cool and rational. But many of the most successful bloggers have quite a bit of emotion in their posts and tweets. I think Noah Smith’s blog Noahpinion is a good example of this. Noahpinion delivers humor, indignation, awe, and even the sense of anxiety that comes from watching him attack and wondering how the object of his attack will respond.  

One simple aid to getting an emotional kick that both Noah and I use is to put illustrations at the top of most of our blog posts. I think more blogs would benefit from putting well-chosen illustrations at the top of posts.    

4. Public

The secret to making a blog more public is simple: Twitter. Everything on Twitter is public, and every interaction with someone who has followers you don’t is a chance for someone new to realize you exist. Of course, you need to be saying something that will make people want to follow you once they notice that you exist.    

Facebook helps too. I post links to my blog posts on my Facebook wall and have friended many economists. 

Finally, the dueling blog posts in an online debate tend to attract attention.

5. Practical Value

In “Top 25 All-Time Posts and All 22 Quartz Columns in Order of Popularity, as of May 5, 2013,” I point out the two posts that are slowly and steadily gaining on posts that were faster out of the block:

I think the reason is practical value. Economists love to understand the economy, but they also have to teach school. They are glad for help and advice for that task.  

6. Stories

Let me make the following argument:

  • a large portion of our brains is devoted to trying to understand the people in our social network;
  • so the author of a blog is much more memorable than a blog, and
  • a memorable story about a blog is almost always coded in people’s brains as a memorable story about the author of the blog.  

Thus, to make a good story for your blog, it is important to “let people in.” That is, it pays off to let people get to know you. The challenge is then to let people get to know you without making them think you are so “full of yourself” that they flee in disgust. Economists as a rule have a surprisingly high tolerance for arrogance in others. But if you want non-economists to stick with you, you might want to inject some notes of humility into what you write.

One simple way to let people get to know you without seeming arrogant is to highlight a range of other people you think highly of. The set of people you think highly of is very revealing of who you are. (Of course, the set of people you criticize and attack is also very revealing of who you are, but not in the same way.)

Summary 

Jonah Berger’s book Contagious is one of the few books in my life where I got to the end and then immediately and eagerly went back to the beginning to read it all over again for the second time. (I can’t remember another one.) Of course, it is a relatively short book. But still, it took a combination of great stories, interesting research results, and practical value for me as a blogger to motivate me to read it twice in quick succession. I recommend it. And I would be interested in your thoughts about how to get a better chance of having blog posts and tweets go viral.         

Further Reading

Jonah recommends two other books that with insights into what makes an idea successful:

  • Malcolm Gladwell’s The Tipping Point: is a fantastic read. But while it is filled with entertaining stories, the science has come a long way since it was released over a decade ago.”
  • Chip Heath and Dan Heath's Made to Stick: Why Some Ideas Survive and Others Die…although the Heaths’ book focuses on making ideas ‘stick’–getting people to remember them–it says less about how to make products and ideas spread, or getting people to pass them on.”

Joshua Foer on Deliberate Practice

Typing on a computer

Typing on a computer

The idea of deliberate practice is one that I have been very eager to get my students to understand. I found a nice passage in Moonwalking with Einstein: The Art and Science of Remembering Everything, explaining deliberate practice. Here it is, from pages 169-175:

When people first learn to use a keyboard, they improve very quickly from sloppy single-finger pecking to careful two-handed typing, until eventually the fingers move so effortlessly across the keys that the whole process becomes unconscious and the fingers seem to take on a mind of their own. At this point, most people’s typing skills stop progressing. They reach a plateau. If you think about it, it’s a strange phenomenon. After all, we’ve always been told that practice makes perfect, and many people sit behind a keyboard for at least several hours a day in essence practicing their typing. Why don’t they just keep getting better and better. 

In the 1960’s, the psychologists Paul Fitts and Michael Posner attempted to answer this question by describing the three stages that anyone goes through when acquiring a new skill. During the first phase, known as the “cognitive stage,” you’re intellectualizing the task and discovering new strategies to accomplish it more proficiently. During the second, “associative stage,” you’re concentrating less, making fewer major errors, and generally becoming more efficient. Finally you reach what Fitts called the “autonomous stage,” when you figure that you’ve gotten as good as you need to get at the task and you’re basically running on autopilot….

What separates the experts from the rest of us is that they tend to engage in a very directed, highly focused routine, which Ericsson has labeled “deliberate practice.” Having studied the best of the best in many different fields, he has found that top achievers tend to follow the same general pattern of development. They develop strategies for consciously keeping out of the autonomous stage while they practice by doing three things: focusing on their technique, staying goal-oriented, and getting constant and immediate feedback on their performance. 

Amateur musicians, for example, are more likely to spend their practice time playing music, whereas pros are more likely to work through tedious exercises or focus on specific, difficult parts of pieces. The best ice skaters spend more of their practice time trying jumps that they land less often, while lesser skaters work more on jumps they’ve already mastered. Deliberate practice, by its nature, must be hard….

The best way to get out of the autonomous stage and off the OK plateau, Ericsson has found, is to actually practice failing. One way to do that is to put yourself in the mind of someone far more competent at the task that you’re trying to master, and try to figure out how that person works through problems. Benjamin Franklin was apparently an early practitioner  of this technique. In his autobiography, he describes how he used to read essays by the great thinkers and try to reconstruct the the author’s arguments according to Franklin’s own logic. He’d then open up the essay and compare his reconstruction to the original words to see how his own chain of thinking stacked up against the master’s. The best chess players follow a similar strategy. They will often spend several hours a day replaying the games of grand masters one move at a time, trying to understand the expert’s thinking at each step. Indeed, the single best predictor of an individual’s chess skill is not the amount of chess he’s played against opponents, but rather the amount of time he’s spent sitting alone working through old games.

The secret to improving at a skill is to retain some degree of conscious control over it while practicing–to force oneself to stay out of autopilot. With typing, it’s relatively easy to get past the OK plateau. Psychologists have discovered that the most efficient method is to force yourself to type faster than feels comfortable, and to allow yourself to make mistakes. In one noted experiment, typists were repeatedly flashed words 10 to 15 percent faster than their fingers were able to translate them onto the keyboard. At first they weren’t able to keep up, but over a period of days they figured out the obstacles that were slowing them down, and overcame them, and then continued to type at the faster speed. By bringing typing out of the autonomous stage and back under their conscious control, they had conquered the OK plateau….

This, more than anything, is what differentiates the top memorizers from the second tier: they approach memorization like a science. They develop hypotheses about their limitations; they conduct experiments and track data. “It’s like you’re developing a piece of technology, or working on a scientific theory,” the two-time world champ Andi Bell once told me. “You have to analyze what you’re doing." 

Also see my post ”Joshua Foer on Memory.“

Joshua Foer on Memory

After reading Joshua Foer’s book Moonwalking with Einstein: The Art and Science of Remembering Everything, I think it is too bad that ancient memory techniques are not routinely taught in our schools. 

Wikipedia currently has this to say about Joshua:

Foer sold his first book, Moonwalking with Einstein, to Penguin for publication in March 2011.[2] He received a $1.2 million advance for the book.[1] Film rights were optioned by Columbia Pictures shortly after publication.[3]

In 2006, Foer won the U.S.A. Memory Championship, and set a new USA record in the “speed cards” event by memorizing a deck of 52 cards in 1 minute and 40 seconds.[4]Moonwalking with Einstein describes Foer’s journey as a participatory journalist to becoming a national champion mnemonist, under the tutelage of British Grand Master of Memory, Ed Cooke.

Here are a few passages that give you some flavor for the book, though the book is more light-hearted than these three passages fullly reveal. Let me mention that the book Ad Herrenium that Joshua mentions is available both as a nicely bound Loeb Classical Library book on Amazon, and free online here. Joshua:

I have to warn you, Ed said, as he delicately seated himself cross-legged, “you are shortly going to go from having an awed respect for people with a good memory to saying, ‘Oh, it’s all a stupid trick.’” He paused and cocked his head, as if to see if that would in fact be my response. “And you would be wrong. It’s an unfortunate phase you’re just going to have to pass through….

Much as our taste for sugar and fat may have served us well in a world of scarce nutrition, but is now maladaptive in a world of ubiquitous fast food joints, our memories aren’t perfectly adapted for our contemporary information age. The tasks we often rely on our memories for today simply weren’t relevant in the environment in which human beings evolved. Our ancestors didn’t need to recall phone numbers, or word-for-word instructions from their bosses, or the Advanced Placement U.S. history curriculum, or (because they lived in relatively small, stable groups) the names of dozens of strangers at a cocktail party.

What our early human and hominid ancestors did need to remember was where to find food and resources, and the route home, and which plants were edible and which were poisonous. This are the sorts of vital memory skills that they depended on every day, and it was–at least in part–in order to meet those demands that human memory evolved as it did.

The principle underlying all memory techniques is that our brains don’t remember all types of information equally well. As exceptional as we are at remembering visual imagery… we’re terrible at remembering other kinds of information, like lists of words or numbers….

Virtually all the nitty-gritty details we have about classical memory training–indeed, nearly all the memory tricks in the mental athlete’s arsenal–were first described in a short, anonymously authored Latin rhetoric textbook called the Rhetorica ad Herrenium, written sometime between 86 and 82 B.C….

The techniques introduced in the Ad Herrenium were widely practiced in the ancient world. In fact, in his own writings on the art of memory, Cicero says that the techniques are so well known that he felt he didn’t need to waste ink describing them in detail (hence our reliance on the Ad Herrenium). Once upon a time, every literate person was versed in the techniques Ed was about to teach me. Memory training was considered a centerpiece of classical education in the language arts, on par with grammar, logic, and rhetoric. Students were taught not just what to remember, but how to remember it. (pp. 90–95)

"Well done,” Ed said, with slow and deliberate applause. “Now I think you’re going to find that the process of recalling these memories is incredibly intuitive. See, normally memories are stored more or less at random, in semantic networks, or webs of association. But you have now stored a large number of memories in a very controlled context. Because of the way spatial cognition works, all you have to do is to retrace your steps through your memory palace, and hopefully at each point the images you laid down will pop back into your mind as you pass by them. All you’ll have to do is translate those images back into the things you were trying learn in the first place. (p. 104)

… But after having learned how to memorize poetry and numbers, cards and biographies, I’m convinced that remembering more is only the most obvious benefit of the many months I spent training my memory. What I had really trained my brain to do, as much as to memorize, was to be more mindful, and to pay attention to the world around me. Remembering an only happen if you decide to take notice….

So why bother investing in one’s memory in an age of externalized memories? The best answer I can give is the one I received unwittingly from EP, whose memory had been so completely lost that he could not place himself in time or space, or relative to other people. That is: How we perceive the world and how we act in it are products of how and what we remember. We’re all just a bundle of habits shaped by our memories. And to the extent that we control our lives, we do so by gradually altering those habits, which is to say the networks of our memories. No lasting joke, invention, insight, or work of art was ever produced by an external memory. Not yet, at least. Our ability to find humor in the world, to make connections between previously unconnected notions, to create new ideas, to share in a common culture: All these essentially human acts depend on memory.  (pp. 268-269)

Economists' Learned Helplessness

“Top 10 Unethical Psychological Experiments”

“Top 10 Unethical Psychological Experiments”

As economists, it is important for us to pay attention to the unintended side effects of our usual initial working assumption that people are fully optimizing–doing the best they can given the situations they are in. To the extent we treat this not just as an initial working assumption, but as if it were the God’s truth, we are in danger of missing opportunities for helping people make better decisions.

Fortunately, economists don’t routinely assume that those in government are always optimizing. Instead, a routine starting point for policy analysis is to act as if those in government want to improve the general welfare (along with some more self-interested motives), but don’t always know how. In an excellent Project Syndicate essay, “The Tyranny of Political Economy,” Dani Rodrik writes about the learned helplessness that can result if one follows to a logical conclusion the assumption that those in government are already fully optimizing–often in a self-serving way–subject to their constraints. He argues that new ideas and advice can make a difference.  

Dani Rodrik worries that the logic of optimization is leading economists to doubt, on principle, whether policy advice can make any difference. I worry that the logic of optimization is leading economists to doubt, on principle, whether advice to households or firms can make any difference.  If we assume people are already optimizing, where in fact they are not, then we will be blind to opportunities to help. If individuals are optimizing 95% of the way, the approximation that they are optimizing 100% of the way could well be an appropriate simplification in building a larger model, but when focusing attention on that decision, it still leaves a 5% leeway for improvement. That 5% improvement in decision-making could correspond to a large increase in welfare–an especially important opportunity because the increase in welfare from better decision-making would require no coercive action, but only persuasion based on the hearer’s appropriate self-interest.

Three Goals for Ph.D. Courses in Economics

MONIAC: The “Monetary National Income Analogue Computer” or “Phillips Hydraulic Computer” built by William Phillips to model the UK economy, displayed at the Reserve Bank of New Zealand.

MONIAC: The “Monetary National Income Analogue Computer” or “Phillips Hydraulic Computer” built by William Phillips to model the UK economy, displayed at the Reserve Bank of New Zealand.

Since I am teaching in the second-year macroeconomic field sequence this year, I have been thinking about the objectives for my teaching. I see three goals for a Ph.D. course:

  1. to teach some of the skills directly necessary to fill out the body of an economics paper, including the computations from data and from simulations (to be laid out in tables or figures), and how to write down the details of proofs.
  2. to give enough of a picture of how the world works to make it possible to begin to judge how important a potential research result might be: for one’s career, for the discipline of economics, and ultimately, in the potential contribution to overall social welfare. (On how the world works, see the recurring refrain in one of my most popular posts ever: “Dr. Smith and the Asset Bubble.”)
  3. to teach analytical tools that–with a few hours or a few days effort–can help one to predict the likely distribution of results one might get from a potential research project that might take months or even years.

a. For straight theory, the development of mathematical intuition is the key for predicting what a project might lead to.

b. For empirical work, key skills for predicting what a project might lead to are

  • understanding identification,
  • understanding the sources and characteristics of measurement errors, 
  • understanding at least rudimentary power analysis in the sense of knowing something about what goes into the standard errors one is likely to get, and
  • understanding that the data are endogenous in two very different senses: (i) data from naturally occurring situations come from a complex web of causal relationships and forces and (ii) economists can cause data to come into existence through surveys, field experiments and lab experiments to help fulfill their research objectives.

c. For computational work, such as a project using a Dynamic Stochastic General Equilibrium model, or a project simulating life-cycle consumption, labor supply and portfolio behavior, some key skills for predicting the likely behavior of a model are

  • understanding general comparative statics and comparative dynamics results;
  • understanding general principles about how models behave, such as key neutrality results that cut across large classes of models and often require intentional modeling devices in order to break (monetary neutrality, Ricardian neutrality, Modigliani-Miller, Wallace neutrality, etc.)
  • knowing how to design a set of graphs to get to the heart of what is going on in a model: graphs that serve the purpose for that advanced model that supply and demand serve for Economics 101 (see for example the graphs in my paper “Q-Theory and Real Business Cycle Analytics”); and
  • knowing how to compute quantitative results for a few simple models by hand in order to get a sense of the likely size of various effects. (You can see an example of what I mean in some of the chapters of my draft textbook “Business Cycle Analytics.”) 

Of course, in all of these areas, research experience and seeing what other people have done–both in published articles and in work presented in seminars–will also help one predict what a project will lead to. Unfortunately, seeing what other people have done is most helpful in understanding paths that are already well-trodden. But sound criticism of what other people have done is immensely helpful in teaching what to avoid. (Helpful hint: when reading papers, be very suspicious of what is claimed in abstracts. At least half the time, abstracts misrepresent what a paper has really accomplished.) Whether one’s own research experience ultimately leads to unique insight into the likely outcomes of various potential projects depends on the directions one strikes out in during the early days of one’s research career.

Steven Pinker on the Goal of Education

In the third-to-last and second-to-last paragraphs of The Stuff of Thought (pp. 438-439, emphasis added), Steven Pinker writes:

When all the pieces fall into alignment, people can grope their way toward the mouth of [Plato’s] cave. In elementary education, children can be taught to extend their number sense beyond “one, two, many” by sensing an analogy between an increase in rough magnitude and the order of number words in the counting sequence. In higher education, people can be disabused of their fallacies in statistics or evolution by being encouraged to think of a population as a collection of individuals rather than as a holistic figure. Or they can unlearn their faulty folk economics by thinking of money as something that can change in value as it is slid back and forth along a time line and of interest as the cost of pulling it forward. In science and engineering, people can dream up analogies to understand their subjects (a paintbrush is a pump, heat is a fluid, inheritance is a code) and to communicate them to others (sexual selection is a room with a heater and a cooler). Carefully interpreted, these analogies are not just alluring frames but actual theories, which make testable predictions and can prompt new discoveries. In the governance of institutions, openness and accountability can be reinforced by reminding people that the intuitions of truth they rely on in their private lives—their defense against being cheated or misinformed or deluded—also apply in the larger social arena. These reminders can militate against our natural inclinations toward taboo, polite consensus, and submission to authority. 

None of this, of course, comes easily to us. Left to our own devices, we are apt to backslide to our instinctive conceptual ways. This underscores the place of education in a scientifically literate democracy, and even suggests a statement of purpose for it (a surprisingly elusive principle in higher education). The goal of education is to make up for the shortcomings in our instinctive ways of thinking about the physical and social world. And education is likely to succeed not by trying to implant abstract statements into empty minds but by taking the mental models that are our standard equipment, applying them to new subjects in selective analogies, and assembling them into new and more sophisticated combinations. 

The one thing I want to add is: moral education serves an analogous purpose: to make up for the shortcomings in the behavior our untutored instincts would lead us into.

How to Find Your Comparative Advantage

Miles gives a delayed response to Jean-Paul Sartre on Twitter

Jean-Paul Sartre said:

The best work is not what is most difficult for you, it is what you do best.

From my own observation, of others as well as myself, let me say this:

When you are good at something, the way it looks to you is that you are OK at it, but everyone around you is messing up.

When things look that way, be patient with those around you and realize that you may have found your comparative advantage–a comparative advantage that might help you go far.

Two Types of Knowledge: Human Capital and Information

Equipment repair

Equipment repair

Human Capital and Information. Knowledge can be either “human capital” or “information.” The difference is the resource cost of transferring a body of knowledge from one person to another. Here is the classification scheme I have in mind:

Human capital is knowledge that is hard to transfer.

Information is knowledge that is easy to transfer.

(This is a specific technical meaning of the word “information” for economics. I use the word “information” in a more general philosophical sense in my post “Ontology and Cosmology in 14 Tweets.”) Note that a given body of knowledge can shift from one category to another when technology changes. The words of the Iliad and the Odyssey were “human capital” when the only means of transferring this knowledge was oral transmission and memorization. When printing arose, the words of the Iliad and the Odyssey became “information." (See Albert Lord's The Singer of Tales on the original oral transmission of the Iliad and the Odyssey.)

Now comes the mid-post homework problem. Read Daniel Little’s description of the knowledge of how to fix machines or my abridged version of it just below, and classify the knowledge of how to fix machines as human capital or information. Here is Daniel Little’s opening paragraph:

There is a kind of knowledge in an advanced mechanical society that doesn’t get much attention from philosophers of science and sociologists of science, but it is critical for keeping the whole thing running. I’m thinking here of the knowledge possessed by skilled technicians and fixers – the people who show up when a complicated piece of equipment starts behaving badly. You can think of elevator technicians, millwrights, aircraft maintenance specialists, network technicians, and locksmiths.

Here is Daniel’s account of the level of difficulty of transferring this knowledge, based on his conversations with a fixer of mining machinery: 

I said to him, you probably run into problems that don’t have a ready solution in the handbook. He said in some amazement, "none of the problems I deal with have textbook solutions. You have to make do with what you find on the ground and nothing is routine.” I also asked about the engineering staff back in Wisconsin. “Nice guys, but they’ve never spent any time in the field and they don’t take any feedback from us about how the equipment is failing.” He referred to the redesign of a heavy machine part a few years ago. The redesign changed the geometry and the moment arm, and it’s caused problems ever since. “I tell them what’s happening, and they say it works fine on paper. Ha! The blueprints have to be changed, but nothing ever happens.”

I would trust Tim to fix the machinery in my gold mine, if I had one. And it seems that he, and thousands of others like him, have a detailed and practical kind of knowledge about the machine and its functioning in a real environment that doesn’t get captured in an engineering curriculum. It is practical knowledge: “If you run into this kind of malfunction, try replacing the thingamajig and rebalance the whatnot.” It’s also a creative problem-solving kind of knowledge: “Given lots of experience with this kind of machine and these kinds of failures, maybe we could try X.” And it appears that it is a cryptic, non-formalized kind of knowledge. The company and the mine owners depend crucially on knowledge in Tim’s head and hands that can only be reproduced by another skilled fixer being trained by Tim.

In philosophy we have a few distinctions that seem to capture some aspects of this kind of knowledge: “knowing that” versus “knowing how”, epistime versus techne, formal knowledge versus tacit knowledge. Michael Polanyi incorporated some of these distinctions into his theory of science in Personal Knowledge: Towards a Post-Critical Philosophy sixty years ago, but I’m not aware of developments since then.

As a practical matter, Polanyi’s distinction between “knowing how” (formal knowledge) and “knowing that” (tacit knowledge) is so important for the costs of transferring knowledge from one person to another that it closely parallels the distinction between human capital and information.

Pure Technology. Let me assume that your answer to the homework problem is the same as mine: knowledge of how to fix machines has a large element of human capital. This has an important consequence: “technology” as we usually think of “technology” is not just made of the easily copied “recipes” that Paul Romer talks about in his Concise Encyclopedia of Economics article “Economic Growth.”

Suppose for the purposes of economic theory, we insist on defining “pure technology” as a recipe that can be cheaply replicated. Then “technology” in the ordinary sense has an element of human capital in it as well as “pure technology,” much as “profit” in the ordinary sense has an element of return to capital in it as well as “pure profit.” The pure technology for mining would include not only

  1. a plan for how the machines are used and repaired, but also
  2. a plan for having new operators learn how to operate the machines and for having new machine repairers learn from more experienced machine repairers. 

The “technology” in the ordinary sense is human capital for using and repairing the machines–that is, already embedded knowledge produced from 1, 2 and learning time.

Economic Metaknowledge. In addition to straight ideas or recipes, Paul Romer emphasizes the importance of meta-ideas:

Perhaps the most important ideas of all are meta-ideas. These are ideas about how to support the production and transmission of other ideas. The British invented patents and copyrights in the seventeenth century. North Americans invented the agricultural extension service in the nineteenth century and peer-reviewed competitive grants for basic research in the twentieth century.

There are many meaning of the prefix “meta.” Paul is using “meta” so that “meta-X” means “things in category X to foster the production and transmission of things in category X.” When another meaning of “meta-” might otherwise intrude, let’s use “economic meta-X” for this meaning. Then with the distinction between human capital and information in hand, there are at least four types of economic metaknowledge–knowledge to foster the production and transmission of knowledge:

  • Meta-human-capital: human capital to foster the production and transmission of human capital. (Teaching skill is the most important example.) 
  • Economic meta-information: information to foster the production and transmission of information. (Many of the most important software programs are in this category: Microsoft Office, the software behind Social Media such as Tumblr, Twitter, and Facebook, TiVo’s software, the software behind the web itself…. Also, computer science and electrical engineering journals on library shelves contain some economic meta-information. In its time, a 17th Century printer’s manual would count.)
  • Human capital to foster the production and transmission of ideas. (Research skill– including the skill of writing academic papers–is a good example.)
  • Information to foster the production and transmission of human capital. (The contents of Daniel Willingham’s book Why Don’t Students Like School? are an excellent example that I highly recommend. He draws his suggestions for teaching from the U.S. Department of Education’s What Works Clearinghouse)

Extra Credit: Figure out how Paul Romer’s meta-ideas listed above–patents and copyrights, agricultural extension services, and peer-reviewed competitive grants–fit into this fourfold division of economic metaknowledge.

Rumsfeldian Metaknowledge. According to Colin Powell (as excerpted in the Appendix below and given more fully at this link) we can blame Donald Rumsfeld’s unchecked insubordination in disbanding the Iraqi Army for some portion of the long hard slog we faced in the War in Iraq since 2003, but Donald did coin a memorable description of another kind of metaknowledge. Here is the 21-second video, and here is the transcript:

[T]here are known knowns; there are things we know that we know.

There are known unknowns; that is to say there are things that, we now know we don’t know. But there are also unknown unknowns–there are things we do not know, we don’t know.

Metaknowledge in this sense of knowing what one knows and knowing what one doesn’t know often has great economic value, whether in daily life, business and policy making. But metaknowledge in this Rumsfeldian sense–even economically valuable Rumsfeldian metaknowledge–should be distinguished from “economic metaknowledge” as I define it above.

Appendix.Here is what Colin Powell wrote:

When we went in, we had a plan, which the president approved. We would not break up and disband the Iraqi Army. We would use the reconstituted Army with purged leadership to help us secure and maintain order throughout the country. We would dissolve the Baath Party, the ruling political party, but we would not throw every party member out on the street. In Hussein’s day, if you wanted to be a government official, a teacher, cop, or postal worker, you had to belong to the party. We were planning to eliminate top party leaders from positions of authority. But lower-level officials and workers had the education, skills, and training needed to run the country.

The plan the president had approved was not implemented. Instead, Secretary Donald Rumsfeld and Ambassador L. Paul Bremer, our man in charge in Iraq, disbanded the Army and fired Baath Party members down to teachers. We eliminated the very officials and institutions we should have been building on, and left thousands of the most highly skilled people in the country jobless and angry—prime recruits for insurgency. These actions surprised the president, National Security Adviser Condi Rice, and me, but once they had been set in motion, the president felt he had to support Secretary Rumsfeld and Ambassador Bremer.

Learning Through Deliberate Practice →

This link gives a taste of the kind of thing you can read in a book I highly recommend: The Talent Code: Greatness Isn’t Born, It’s Grown by Daniel Coyle. In order to learn a lot, you need to 

  1. put in the hours and
  2. study effectively during those hours.

To study effectively, you need to do a lot more than “going over things” several times. You need to identify what you don’t completely understand and zero in on it to figure it out.  You need to wonder how each idea relates to everything else you have learned. You need to get to the point where you can write your own exam questions and answer them, carefully thinking through what it would make sense for the instructors to test.    

The human mind has a natural tendency to skitter away from things that are hard to understand. Effective study requires you to resist that tendency like a bad addiction. You need to turn toward the ideas that are hardest, not away from them.

Adam Ozimek: School Choice in the Long Run →

Many programs to help the poor create incentives not to earn too much, which discourages hard work. By contrast, improved schooling raises the incentives to work hard at a career because the range of job choices is so much greater after better schooling. So I have long thought of school reform as an ideal avenue for helping the poor. And since monopolies and near-monopolies tend to perform poorly, I have long been a passionate advocate of school choice. In “School Choice in the Long Run,” Adam Ozimek provides a subtle discussion of evidence for the benefits of school choice.

Update: In a related post, Matthew DiCarlo provides a good discussion of why attrition “Student Attrition is a Core Feature of School Choice, Not a Bug.”  

Magic Ingredient 1: More K-12 School

Photo from “Is KIPP the Answer for Twin Cities Schools,” Minnesota Public Radio

Photo from “Is KIPP the Answer for Twin Cities Schools,” Minnesota Public Radio

In my book, the two truly wonderful things Barack has done on the domestic front are advancing gay rights (through ending “Don’t Ask, Don’t Tell” and more recently by rhetorical support for gay marriage rights) and advancing education reform through the brilliant work of Arne Duncan as his Secretary of Education.  By dangling a few gigadollars worth of grant money in front of states, Arne has gotten states to fall all over themselves passing education reforms that I would have thought impossible in such a short time–often with buy-in from the teachers unions.  I cheer on this effort and other efforts at education reform.

Although I am in favor of more school choice, including both charter schools and Milton Friedman’s still excellent idea of education vouchers, let me focus in on two aspects of education reform that can be fully implemented within regular public schools: increasing the total amount of schooling kids get in their K-12 years and making sure they are legally qualified to pursue a wide range of careers when they earn a high school diploma.

Sometimes the most important fact in a given area is one so obvious it might not even seem worth saying. I heard one such fact from a top researcher in education at an academic seminar at the University of Michigan’s Survey Research Center: the single most important variable in predicting whether a student will get a test question right is whether that topic was covered in class or not. Students don’t always remember what they were taught. But they never remember something they weren’t taught. More time in school means more things can be taught at least once, and the more important things can even be repeated a few times.

The secret recipe behind the “Knowledge is Power Program” or KIPP schools (which have been very successful even with highly disadvantaged kids) is this:

  1. They motivate students by convincing them they can succeed and have a better life through working hard in school.
  2. They keep order, so the students are not distracted from learning.
  3. They have the students study hard for many long hours, with a long school day, a long school week (some school on Saturdays), and a long school year (school during the Summer).

The KIPP schools also have highly motivated teachers, but that is a topic for another day.

So my first proposal for this post is to go to a 12-month school year, and to extend the school day until at least 5 PM (but with many extracurricular activities and sports being eligible to count as part of the school day, as they do in Japan). Research has shown poor kids and rich kids learn at a somewhat similar rate during the school year, but that poor kids forget a lot during the Summer, while rich kids retain more. So lengthening the school year is especially helpful for poor kids. Lengthening the school year and the school day also effectively provides year-round day care for poor parents who desperately need it. For rich families who are used to being able to go on a summer vacation, I would allow families to make proposals for family or individual activities with educational value that could substitute for some part of school in the summer, and grant permission for these substitutions for summer school relatively liberally for anything that research shows keeps kids academically sharp. The poor kids will think this is unfair, but they simply need the formal schooling more because their parents can’t afford other high-quality educational activities. So keeping them in school during the summer really is doing them a favor.

I won’t try to work out all the details of how the longer school day and school year would work, but I need to address one objection that will spring to many readers minds: extra costs. I don’t want to assume massive new infusions of money into schooling that might never be available. But I think it can be done without major additional costs. The school buildings are there anyway, year round, so the major expense to worry about is teacher salaries. Here I think we could start by having each teacher teach the same number of annual hours as they now do, but staggered throughout the year. (Over time, on a merit basis, some teachers could be allowed to work year round at a commensurately higher salary, to make up for normal attrition.) The margin that would give is that class sizes would go up. Except in Kindergarten, and maybe in 1st grade, higher class sizes have been shown by research to have only a small effect on learning–probably less than a tenth the effect on learning on the minus side that more total school hours for the kids would have on the plus side. We might need to knock out a few walls between classrooms to accommodate these larger class sizes, but it could be done. (Note that the total number of kids in school at any one time would be basically the same as now, so the kids would fit.) Even with these expedients, costs would go up some. For example, the lights would have to be kept on longer. But I think it should be manageable. And the fact that some of the rich kids wouldn’t be there in the summer would either help bring down class sizes for the poor kids then, or allow school districts to save on staffing during the summer.  

Much of the extra schooling time from the longer school day and longer school year would go toward learning the basics better–reading, writing, math–and maybe getting a little extra cultural background that will help students enjoy a wider range of things in their lives. But I want to claim some of the extra time to make sure that the kids are legally qualified to do a wide range of jobs when they finish school. One of the most important drifts of political economy at the state level in the United States has been toward requiring licenses for more and more jobs. Here is what Morris Kleiner and Alan Krueger say in their 2008 National Bureau of Economic Research Working Paper “The Prevalence and Effect of Occupational Licensing”:

We find that in 2006, 29 percent of the workforce was required to hold an occupational license from a government agency … Our multivariate estimates suggest that licensing has about the same quantitative impact on wages as do unions–that is about 15 percent …

Many economists and other observers feel that occupational licensing has gone too far. Here is an interesting Wall Street Journal article:

Dick Carpenter and Lisa Knepper WSJ “Do Barbers Really Need a License?”

And here is an article from what I think is a Libertarian website (“The Library of Economics and Liberty”):

S David Young, “Occupational Licensing”

Others argue that health and safety and basic competence really do require training even for many jobs that sound easy, such as cutting hair or cutting nails. 

What I want to do is to restrain the tendency to go overboard on occupational licensing while allowing genuinely necessary competencies to be transmitted by requiring states to ensure that their schools high school tracks that would make it reasonably possible to be meet the legal qualifications for any of at least 60% of all licensed occupations, with each student able to be qualified with his or her high school diploma for at least 10% of all licensed occupations. Then the graduates might actually be able to get a job. This requirement for getting the Federal education grant could be met by any combination of reducing licensing requirements and increasing effective training that each state chose. I am sure that states would game the rule, so that the overall effect would be less than what this sounds on the surface, but it would be better than the way things are now, where students graduating from high school are kept out of many of the more desirable occupations by occupational licensing restrictions.  

Many schools these days have a program that allows more ambitious students to earn an Associate’s degree (equivalent to two years of college) before their time in publicly-funded high school education runs out. For them, I would add the requirement that states make it possible for ambitious students doing the equivalent of an Associate’s degree to be licensed for any of 50% of medical care jobs. (Being a doctor would still require much, much more training. Note: “any” is not the same as “all.” They would have to do some choosing.) This would not only help these students get jobs, it would help us as a nation to be able to afford the medical care that we want.  

Note that any reduction in occupational licensing restrictions increases the value of having  readily available and accurate quality ratings for services as well as goods. To be honest, in my personal experience, which I think will match that of most of my readers, I have seldom been satisfied with services from the bottom half of those in any occupation. But the stratification into different quality levels should be handled by the market as much as possible (and by government fiat as little as possible), with continually improved web-based ratings mechanisms. High school graduates need entry-level jobs, even though it is hard to be really good at anything at first before accumulating experience, especially for those who would not have been able to get jobs at all without the changes I am advocating.

Let me end by explaining my title. In his recent post “What it to be done now, Jeff Sachs appears to miss the point by a substantial margin,” Brad DeLong lays out his short-run Keynesian program for the economy, and says this about Jeff Sachs’s column:

When I started Jeff’s column, I thought it was going to be an exercise in hippie-punching, along the lines of: “Simplistic Keynesian remedies will not solve our problems. See, I am a Very Serious Person. What will solve our problems is X.” And X would turn out to be simplistic Keynesian remedies plus some magic ingredient Y. That might have been useful. It would have been a call for simplistic Keynesian policies plus magic ingredient Y.

As I discussed in my immediately previous post “Preventing Recession-Fighting from Becoming a Political Football” I am all for more aggregate demand right now, as long as it is achieved in ways that don’t ultimately add too much to the national debt, but what Brad DeLong’s words sparked in me was a desire to come up with “magic ingredient Y” for long run growth and improvement in the economy. Thinking that there might be many magic ingredients that can help in the long run–hopefully more than there are letters in the alphabet, I am going to start off with numbers. Hence, “Magic Ingredient 1: More K-12 School.”