This Week’s EconTalk Episode: Piketty

22 09 2014

Thomas Piketty of the Paris School of Economics and author of Capital in the Twenty-First Century talks to Econtalk hostRuss Roberts about the book. The conversation covers some of the key empirical findings of the book along with a discussion of their significance.

Listen to the podcast here.

When The Chips Are Down

8 06 2014

This week’s Econtalk episode is on the future of work in an age of accelerating technological change. The guests were Andrew McAfeeMegan McArdle, and Lee Ohanian along with with EconTalk host Russ Roberts. The discussion was wide-ranging and included topics such as the idiotic US system for allocating visas to high-tech workers and changing gender roles. However, the discussion kept coming around to the issue of technological unemployment and the possibility that AI will contribute to increasing income inequality by eliminating even more routine jobs when simultaneously boosting the incomes of the 1%ers with the requisite skills.

Last week, the BBC rebroadcast a 1977 documentary called “When The Chips Are Down”. This documentary, which  was about the social impact of the computer, contains extensive scenes filmed inside Silicon Valley companies. The documentary was somewhat prophetic in its discussion of the possible impact of computers on economic inequality.  I recommend listening to the Econtalk podcast first and then watching the 1977 documentary. The really interesting stuff about the socio-economic impact of computers starts around 40 minutes in. The first half of the documentary just deals with the history of the computer– the replacement of vacuum tubes with transistors, the falling cost of computer power, etc.



Conference on Ronald Coase and His Times

5 11 2013

AS: As readers of this blog will know, the great economist Ronald Coase (1910-2013) died  earlier this year. To learn more about this important contributions to economics and economic history, listen to this recent podcast.  In the podcast, Don Boudreaux of George Mason University chats with Russ Roberts about Coase’s four key publications. Coase, who completed his graduate education at LSE in the early 1930s, was arguably the last of the great literary economists: Coase’s articles were beautifully written and contained relatively few numbers, which made them accessible to a wide range of people. 

Coase formulated his famous theory of the firm while he was working at the newly founded Dundee School of Economics and Commerce in the 1930s.  The School, which is now part of the University of Dundee, is hosting a conference this month at which scholars will present a papers in which they seek to place Coase in his immediate historical context.  Judging from its title, Carlo Morelli’s paper will assess whether Coase’s theory of the firm was based on his observations of Dundee’s jute industry



Morelli’s paper appears to contradict a statement about the inspiration for Coase’s 1937 paper on the Nature of the Firm that Russ Roberts made in the aforementioned podcast.  In the podcast, Dr Roberts stated that the paper

 grew out of a trip that Coase had made, with a fellow student I believe, to the United States, a research trip. He was a student at the London School of Economics (LSE), where he encountered Friedrich Hayek; Hayek was one of his professors. His main professor was Arnold Plant. Arnold Plant was very interested in accounting and did some work in the economics of accounting. As did Coase. Coase got a fellowship in the early 1930s to the United States, and he studied actual business organization. At some point it dawned on him that the way economists talk about the firm, the firm is a black box. To this day we don’t really talk about what goes on inside the firm. 

I know this is a small point, but it seemed worthy of mention.

The Dundee Jute Industry In Its Prime

Anyway, here are the details of the conference.

The University of Dundee’s Scottish Centre for Economic Methodology is hosting a conference 18 November 2013, “Origins of the Theory of the Firm: Ronald Coase at Dundee, 1932-1934.” The program looks really interesting:

  • Keith Tribe, “Dundee and Interwar Commercial Education.”
  • Billy Kenefick, “‘A great industrial cul-de-sac, a grim monument to “man’s inhumanity to man.” ‘ Dundee by the early 1930s.”
  • Carlo Morelli, “Market & Non-Market Co-ordination: Dundee and its Jute Industry – The Case Study for Ronald Coase?”
  • David Campbell, “Agency, Authority and Co-operation in the Firm: Coase, Macneil, Marx.”
  • Alice Belcher, “Coase and the Concept of Direction: How Valuable are Legal Concepts in the Theory of the Firm?”
  • Brian Loasby, “Ronald Coase’s Theory of the Firm and the Scope of Economics.”
  • Alistair Dow & Sheila Dow, “Coase and Scottish Political Economy.”
  • Eyup Ozveren & Ilhan Can Ozen, “Coase versus Coase: What if the Market Were One Big Firm Instead?”
  • Neil Kay, “Coase, The Nature of the Firm, and the Principles of Marginal Analysis.”

Hat tip to Peter Klein.

P.S. Coase briefly taught at the University of Liverpool, my new employer.

Russ Roberts, National Cultures of Education, and Why Rate My Lecturer Flopped in the UK

12 09 2013

As readers of this blog will know, I’m a big fan of Econtalk, the podcast series hosted by Russ Roberts of the Hoover Institution at Stanford. My wife likes it too, which is why we listen to it in the car. This podcast series covers a wide range of issues related to economics, with the discipline being defined in the widest possible terms. I’ve learned a great deal about topics such as climate change and eighteenth-century moral philosophers in these podcasts, which are becoming an important part of my ongoing education as a historian and a social scientist.

In a recent podcast, Roberts interviews Eric Hanushek of the Hoover Institution about his research on the performance of US education system relative to that of other industrialised countries. Much of the conversation focuses on the performance of children of different nationalities on standardized tests.

I was pleased but not terribly surprised to learn that Canadian schools are much better than American ones, although the average Canadian teenager tests a bit below the average teenager in Massachusetts, the best performing American state. McKinsey Consulting recently said that the Province of Ontario had the best public education system, at least in the English-speaking world. Of course, the qualifier “in the English-speaking world” is important here, as my German and East Asian friends might remind me.

Roberts also said in this podcast that (North) America has the best universities in the world. Based on what I’ve seen in a number of EU countries, I’m inclined to agree with that. The student experience at even the elite universities in Europe can’t really compare with that of an undergraduate at a good university in North America simply because there is less money coursing through the system. I really don’t see much difference between Canadian and US universities and neither do Hollywood film crews, since they have used Canadian campuses for movies set at US universities. The library holdings, quality of the academics, etc are broadly similar.

The conversation got around to the issue of culture and how that influences learning and teaching styles in different societies. East Asian societies are at one end of the spectrum: they are hierarchical, do not reward creativity, and have education systems that are based on rote-learning. The United States is at the other end: the school system and the wider society value individuality, creativity, and innovation. Hanushek recalls that one of his graduate students had a shock when he returned to his native Korea to take a job and then told his boss that he could do something better: making a minor suggestion to the superior was a major faux pas in Korean culture.  Interestingly enough, education officials in South Korea are concerned that their students lack creativity and are trying to come up with a solution. (Personally, I’m sceptical of the idea that the creativity/individuality can be increased by central planners in some education ministry, either through targets, quota, or any other policy).

East Asian students who study in the West are famous for being unwilling to debate with their professors. Doing so goes against deference to elders and other cultural norms. Of course, the West is not a monolithic cultural identity itself, as any North American teaching in a UK university can attest. British university students are far less likely to ask questions, debate with professors, or do anything except sit and take notes passively. In part, this is because they have been conditioned by a secondary school system that is structured around high-stakes standardized tests, such as the A-Level exams that determine the future of young people in a few hours.  Obviously British students are far closer to North Americans than they are to Japanese or Koreans, but there is a definite cultural difference: they are less likely to speak up.

This cultural difference has had an impact on the attempts to popularize websites that allow students to evaluate professors. In North America, RateMyProfessor has been popular for about a decade. This website allows students to grade professors according to a variety of criteria. It also has an infamous chilli pepper icon that students can use to indicate that a teacher is physically attractive. Millions of students have rated one or more of their professors on RateMyProfessor Personally, I find that RateMyProfessor ratings correspond to my own impression of academics provided there is a good sample size (e.g., ratings from more than ten students). Every academic on that website has at least one negative review from a student with a grievance. The key thing is to see what the average rating is. When I was an undergraduate in the 1990s, the student government at my university produced a printed document called the “anti-calendar” that provided student ratings of professors and individual courses. As with RateMyProfessor, every prof, even the most brilliant lecturer, had one or two bad evaluations, perhaps from the guy they caught cheating. The key thing to look for was the average rating.  Here is a sample a rating, selected at random.

Rachel Cohen Lehman - University of California Irvine -

Anyway, RateMyProfessor tried to expand into the UK by creating stubs for UK universities. The problem was that very few British students bothered to rate their instructors. I remember looking at the ratings of UK academics on it were obviously written by visiting North American students.

I suppose that part of the explanation for the unpopularity of RateMyProfessor  was confusion about which university employees would be listed there. That’s because was that many university teachers in the UK are called “lecturers”: at most UK universities, the title “professor” is reserved for people who would be a full professor in the US system, which is also the system in Canada and Japan. However, I don’t think that’s the main reason for the unpopularity of RateMyProfessor in the British Isles, since many UK students use the term “professor” in ordinary conversation to refer to any university teacher. Moreover, some of the more North Americanish universities, such as Warwick, use titles such as “Associate Professor”. (Warwick is a British university that wishes it was in the New World and even kinda looks like a North American suburban campus).

More recently, RateMyProfessor franchised its format to a UK company that created “RateMyLecturer.” The format is similar except some of the criteria for ranking academics are different. For instance, the UK website does not allow students to score lecturers according to the “easiness” of their marking. Similarly, there are no chilli peppers in the UK version.


When this website went live there were expressions of outrage by some UK academics. The really interesting thing is that very few British students have rated any of their university teachers. The website has been online for months now and few academics have been rated yet. (I’ve checked out a few departments and universities I know).

Very typical RML Stub, Note that there are no ratings by students.

Very typical RML Stub, Note that there are no ratings by students.

I suspect that the underlying reason for the unpopularity of RateMyLecturer in the UK is the reluctance to challenge or critique teachers and other authority figures that is ingrained in UK academic culture. I find this reluctance somewhat odd, since British people have no hesitations in writing frank online reviews of restaurants or hotels, such as this amusingly critical one.

I’m married to a Japanese person and feel that the excessive deference to authority inculcated by Japan’s much over-rated education system is responsible for many of the problems Japan has today. In Japanese organizations, it is difficult for an underling to muster to courage to point out a problem to a superior. What I’ve read suggests that Japanese culture contributed to the sequence of events that resulted in the Fukushima nuclear disaster. In the West, there would likely have been whistleblowers before the disaster. At the very least, someone in a meeting at the power company would have, to use an Americanism, “called bullshit” on some of the claims of senior executives that the plant could withstand a tsunami.

Anyway, I think that the problem of institutional culture we saw at the Electric Power Company is widespread and not just Japan. In thinking about the future of higher education around the world, we need to keep these cultural differences in mind.