Inequality in America: What Role for Human Capital Policies? (Alvin Hansen Symposium on Public Policy at Harvard University) [Tapa blanda]

This conversation/debate between two of the country's most distinguished economists focuses on one of the central questions in the design of social policy: How should government invest its resources in order to generate the biggest returns to the society? Should it focus mainly on very young children or should it underwrite a broad array of programs, from prenatal care through job training programs?

"Inequality in America" isn't for everyone--the use of statistical analyses and technical language will scare off some readers--but for the policy wonk, broadly construed, this is essential reading. (Even the non-wonk who is willing to do some hard intellectual work can learn a great deal.)The book is structured, not as a "two ships passing in the night" pair of arguments but rather as a series of point-counterpoint discussions; the authors offer no-holds-barred criticisms of one another's arguments, sometimes in acidic language (with commentators adding additional perspectives). This structure adds considerably to its value, for readers are provided with enough evidence and analysis to reach an informed conclusion.

My intellectual preferences generally run to the ethnographic rather than the economic, to contextualized narratives/cases rather than number-crunching, to work more readily accessible to a broader audience. But this is a powerful exception: I learned more from "Inequality in America" than from anything I've read in a long time.

Although the contributors to this book are prominent economists(Heckman, Summers, and Krueger especially) it wasn't that good. There was too much quarreling between Heckman and his coauthor Caneiro and Krueger--Most of which was petty (my methodology is better than your methodology). A noneconomist is not in a position to judge who won this debate. I gained very little knowledge from the arguments. There are much better books on this subject.

This book will appeal to economists who specialize in human capital policy, but by focusing on methodology is too technical. It was written by economists, which means that the book's main purpose is twofold: 1. vain attempts at the quantification of human and social psychology and 2. cheerleading for conservatism. The solutions are practical, but you get the sense the authors, all instructors at ivy league or very selective institutions, are divorced from reality and actually believe the reduction of complex social problems can be simply solved from an ivory tower.

Not surprisingly, Heckman and Carneiro (HC) advocate vouchers and choice as the solution, again as if just by adding market mechanisms into any social endeavor will magically lead to socially optimal outcomes, in this case equality. HC's first point is that there is a perception that something is wrong with education. They are correct on that point, although it may not be true. Other countries perform better than the U.S. on many assessments because they track students early into vocational and postsecondary settings. In the U.S., we have had to accept lower performance in exchange for access and increased levels choice.

The cause of lower performance, HC suggest, is that teachers have little incentives to produce knowledge. The same, of course, can be said about professors like HC. For instance, if you do a search on google, the Univ. of Chi. website, an academic search engine, or the Univ. of Chi. economics department, you will see no evidence that students in his class have ever learned anything (not that they haven't; there just isn't any evidence). Since Heckman is dealing with a group of highly motivated and academically prepared students, all he is doing is just not messing them up instead of actually contributing to their knowledge. Heckman's students would be much better off in an economics course at what HC call a "lower quality" institution, where instructors have to actually show evidence of learning and where the least academically prepared with the least advantages in life show actual growth in learning.

Indeed, Heckman himself has incentives to not care. He's got tenure, earns six figures, never gets evaluated on what students learn or needs to provide evidence of it. HC's argument is compelling, and all colleges and schools should be held accountable and demonstrate learning outcomes. But I doubt as professors HC would ever be willing to implement the same policies in their programs they advocate in their article (i.e. annual program reviews, annual publicly articulated assessment of learning, etc.). I think I smell a couple of chickenhawks...