On the Margin

Inspirational Quote

2012-02-02T06:41:00.000-08:00

"If you can't annoy somebody, there is little point in writing."
--Kingsley Amis

Being Humbled

2012-01-31T18:40:00.000-08:00

Yes, this is about that pesky textbook again, but there's a broader lesson or two that apply in other contexts that I need to remember.

When the reviews of my sample chapters came back, they were pretty positive. One or two of the reviewers said they would like to see some coverage of macro topics, and at the time, I brushed that off. The book I had envisioned was a book with a thesis, a thesis that glued micro topics together like epoxy. You could teach an entire semester and more with the book I envisioned, so why would I need any macro chapters?

But my editor was pretty firm that omitting macro topics was a deal breaker, and this was frustrating to me. This was my vision! After all, Hemingway didn't have an editor telling him how to refine his vision, did he?

Oh. Yes. He did. An editor that not only checked his mechanics, but whom Hemingway consulted on character development, plot, and whatnot. Key stuff.

Oh. Yeah. And I am not Hemingway.

And so I was reminded that publishing is a partnership. They put a lot of money into this project before the first copy ever hits bookstore shelves, and through that earn some right to have a say in its development. We both want to see this project be as successful as it possibly can be. And it turns out that lots of schools teach a one semester issues course with specified learning goals that include macro topics. Omit macro, and I automatically forego the chance to sell my book to those schools.

All of this, of course, is a year and a half ago. Before Occupy Wall Street, before the partisan budget battles. And now, I realize that my editor was right: macro issues are not only important because they sell books, but they're important to ordinary people, and they're important to college students. My book will include macro issues, and it will be better for it. Humbling to realize that you were wrong.

So I've been thinking about this for a few months now. I've even come up with some ways to tie the macro topics to the general theme that unifies my micro topics. And those micro chapters are largely done. So it is time to start the macro, and to be honest, I have not written anything in macro before. I am in uncharted waters here, and a bit worried about it. Nevertheless, tonight, I begin.

A new semester has begun . . .

2012-01-28T20:01:00.000-08:00

and I am reminded how much fun it is to see familiar faces, happy faces, ready to learn whatever it is we're going to study in class this semester.

Work itself is not always fun, but having students that I know and like is a great joy.

Okay, you caught me again . . .

2012-01-28T19:59:00.000-08:00

It's been awhile since I've posted, and while I do claim that the intervening months have been ridiculously busy (they have!), I do need to get back into the habit of writing periodically.

A new school year has just begun, and now that I am back in school I am motivated again to resume work on other projects as well. First among them: the textbook project. In early Novermber, I was offered a contract based on the work I had submitted and had reviewed a couple of summers ago. I promptly was advised to take the next couple of months off until I could finalize the contract and be assigned to a production editor, advice I was only too happy to take!

So now it's the new year, and despite being mostly done with the text in my own mind, I am now on the hook to double the quantity going into the text (yep, there's a word count in the contract!), which is a bit daunting. I do have several more chapters to write, which I will talk about in a post in the near future. Whatever the case, it is time to get busy once again, and I have set for myself a target of one hundred pages by the end of the term.

Any questions between now and victory? Good. Let's get started.

Oh, Christmas Tree

2011-11-11T06:17:00.000-08:00

I'm not anti-government. In fact, I teach an entire course about how the careful application of government to certain problems can make the world a richer place. But I do believe that government needs to establish priorities, and needs to be thoughtful about what it chooses to dip its fingers into.

Case in point: the Christmas tree tax. This 15-cent per tree fee would be collected by the U.S. Department of Agriculture, and would be used to fund a promotional campaign for Christmas trees along the lines of dairy's "Got Milk?" campaign.

Any economist worth his flocking can go on and on about the economic effects of the Christmas tree tax. So here, I offer only a few brief thoughts. The first: It seems ironic to believe that taxing Christmas trees will help sell more Christmas trees.

Second: Seriously? All the troubles we have in this country, and you're spending our hard-earned tax dollars to develop and implement a go-nowhere program like this? Where on Earth is your sense of priority?

Finally: A promotional campaign for Christmas trees? Do they really need help? After all, it's not broccoli we're talking about.

I believe . . .

2011-10-04T06:06:00.000-07:00

that dislike for a particular group of people is a poor foundation for public policy.

Why economists don't get invited to many parties . . .

2011-09-29T12:38:00.000-07:00

It's a wonderful life. But a more wonderful painting.

At least

2011-09-22T14:14:00.000-07:00

the Tea Partiers tell the truth. They want lower taxes and smaller government, and they'll tell you that, even if it makes them look cruel.

I want the Dems to tall the truth, too. I want them to stop saying that the super-rich "don't pay their fair share," and to start saying, "We want a lot of stuff. And we can't afford or are unwilling to pay for that stuff ourselves. So we're going to make you pay for it for us."

At least it'd be honest.

Just because . . .

2011-09-22T13:29:00.000-07:00

I'll never be a top two-percenter doesn't entitle me to be disrespectful of those that are.

A nation . . .

2011-09-22T13:26:00.001-07:00

can no more tax itself into prosperity than can a fat man eat himself into thinness.

Motivation

2011-09-08T12:32:00.000-07:00

So I'm having a tough time getting back to writing, which I suspect is an illness that lots of writers find themselves afflicted with from time to time. For me, it's not just that I'm not putting words on the page, it's that I'm breaking a commitment that I've made to myself that I'm going to see this project (actually, these projects) through to completion.

The problem is that nobody has really put me on a deadline, so in the evenings, when I do my best writing, it's all too easy to call up an episode of Columbo (did you know they last for almost two hours?) and open a frothy amber beverage instead of doing what I've told myself I'm going to do.

In the past, when I've reached the point where I ignore self-imposed deadlines, I've found it helpful to call in a neutral enforcer. And of those neutral enforcers, none has been more effective than a website organized by a couple of economists, stickk.com

The premise is simple: you go to stickk.com and register a commitment that you've made to yourself. They take your credit card number, and if you and a neutral third party fail to report that you've met your commitment, the website bills your credit card for an amount you predetermined, and transfers those funds to the charity of your choosing.

Of course, if you pick a charity you appreciate, it might be tough to keep your commitment. "Well, looks like I won't get this book chapter written, but at least the money I posted is saving starving children in Lower Volga." So Stickk.com gives you the option of choosing an anti-charity, a charity you despise, instead. "Damn, I'd better drop those last few pounds or the Humans For Clubbing Cute Baby Seals Society will get my $50 donation. We can't have that, can we?"

So today, I'm making a commitment to myself, with stickk.com as the enforcer: a major revision to the first chapter of my book, and a draft of another chapter, by the time the clock strikes midnight on the last day of September.

Can I get a second opinion?

2011-08-31T10:07:00.000-07:00

This fall, I'm using a first draft of my book manuscript in my Economic Analysis of Social Issues course. I have asked my students to carefully proofread it for errors in spelling, grammar, and punctuation, and am rewarding them for finding mistakes.

The response has been overwhelming. They've found dozens of errors that I and several others have repeatedly overlooked. It's impressive, and humbling, and a bit embarrassing, and totally worth doing.

I will never again send anything out for publication without having a second set of eyes look over what I've written.

The most reasonable argument for free trade I can muster: A parable.

2011-08-26T19:15:00.000-07:00

Bob and Phil live in North Dakota just south of the Canadian border. Bob is a rancher, Phil is a farmer. They have been trading Bob's beef for Phil's corn for the last five decades. They trade high-quality products at an exchange rate that both find attractive.

One day, a government official comes calling with the news that 100 years ago, the US Geological Survey made an error in surveying the border, and that Phil actually lives in Canada.

Bob promptly stops trading with Phil and buys his corn from Neil, who lives in Nebraska. It costs more, and it's not as good, but at least he's buying American.

Steve Jobs on Creativity

2011-08-26T07:32:00.000-07:00

“Creativity is just connecting things. When you ask creative people how they did something, they feel a little guilty because they didn’t really do it, they just saw something. It seemed obvious to them after a while. That’s because they were able to connect experiences they’ve had and synthesize new things. And the reason they were able to do that was that they’ve had more experiences or they have thought more about their experiences than other people.

“Unfortunately, that’s too rare a commodity. A lot of people in our industry haven’t had very diverse experiences. So they don’t have enough dots to connect, and they end up with very linear solutions without a broad perspective on the problem. The broader one’s understanding of the human experience, the better design we will have.

On Rick Perry

2011-08-25T19:36:00.000-07:00

When asked by a schoolkid about his views on evolution, Texas Governor and Presidential hopeful Rick Perry answers, "In Texas, we teach both creationism and evolution, because I figure you're smart enough to figure out which one's right."

So, according to Perry, one is right, and one is wrong. And apparently the little guy is smart enough to figure out which is which, but his teachers and his school board and his state board of education and his Governor are not. Because if they were, they would recognize the foolishness in teaching something in public schools that they know to be wrong.

You can't have it both ways, Governor.

Scholarship, revisited.

2011-08-24T07:49:00.000-07:00

Last night, I dug out the table of contents that I developed when I first started my textbook project, and compared it to the current table of contents. The big ideas are largely the same, but:

Many--very many--of the things I had indicated I would cover in each chapter have been discarded and replaced with better things.
I have discarded a chapter or two altogether, and have added about five.

My book is a much better book for those changes. And those changes are the result of hours and hours and hours of thought that occurred both while I was sitting at the keyboard and also during the hours between writing sessions. Those hours of thought, hours that would never have existed had I not been writing, revealed that some of the ideas I began with were silly. They also showed me that to establish a unified thesis for the entire text, I needed to cover topics I hadn't considered at the outset.

I had been teaching the topics covered in the textbook for years before a single word was ever committed to paper. And if I'd never written a word, the course would have been good enough. But putting pen to paper has made my course and my teaching better: sharper analysis, greater rigor, better examples and deeper ideas. Those hours have clarified my thoughts and made me a better professor. And that, to my mind, is the importance of scholarship. Scholarship and teaching are not necessarily substitutes, wherein more of one means less of the other. They can be complements, in which more and better scholarship results in better teaching.

Scholarship

2011-08-22T07:54:00.000-07:00

Last week, a group of faculty met to discuss professional development. It was interesting to watch the conversation unfold -- as it did, it was clear that the faculty were making a distinction between professional development (examples of which might include attending conferences, teaching workshops, and the like) and scholarship (which implies some research project or creative activity with an original end product). At Baker, professional development is a required chunk of the duties we are evaluated on; scholarship is viewed as a subset of professional development. At Baker, that ordering implies that you can't get tenure/promotion without professional development, but that it is possible to do so without any scholarship.

Keeping in mind that this is my opinion only, I think this is unfortunate. One reason that it is unfortunate is that it is through the process of scholarship--of taking a problem and really wrestling with it--that we deepen our understanding of our field. Anyone who has ever written a term paper knows that it is one thing to read about a topic, but another thing entirely to write about it. The writing process helps us clarify and organize our thoughts in ways that reading, and even deep thinking, cannot. If you'll forgive me quoting a bit of economics jargon, Dierdre McClosky sums this up: "Economically speaking, the production function for thinking cannot be written as the sum of two sub-functions, one producing 'results' and the other 'writing them up.'The function is not separable. You do not learn the details of an argument until writing it in detail, and in writing the details you uncover flaws in the fundamentals." The same, of course, holds true for creative activity--it's one thing to look at, and even critically evaluate, a piece of art; it's another thing entirely to create artwork of your own.

A second, and not inconsequential, reason that I believe a faculty should be engaged in scholarship is that it brings recognition to the university. As a university, we want people to know who we are and what we do. We want them to see that we're an engaged and active faculty. We want them to think, "These people at Baker are doing interesting things. When my kid is ready to go to college, I want him to think about going there."

But the most important reason for faculty to engage in scholarship is the simplest. As an institution, we routinely ask our students to research, write, and create. We laud the virtues of becoming lifelong learners. Our gen-ed program is based on a foundation of inquiry-based learning, in which students ask interesting questions, figure out what tools they'll need to answer those questions, and then actually work toward finding an answer and sharing it with others. If we, as a faculty, are going to ask our students to do these things, shouldn't we be doing them ourselves? Shouldn't we be modeling lifelong learning? Won't engaging in our own scholarship help us teach that process to our students? Won't we understand our students' struggles better if we routinely face the same struggles ourselves? Economist and mathematician Steven Landsburg summarizes these ideas for his daughter in his book, Fair Play: "When choosing a college, try this thought experiment: Imagine that you've walked into a living room where a small circle of people is talking animatedly and excitedly while several others sit quietly on the sidelines. If you wanted to know what the conversation was about, who would you prefer to ask? If you think the participants would give you a more accurate and enticing answer than the observers, then you should go to a university where you're going to be taught by active researchers."

I think the Baker faculty are wonderful. I think they accomplish a lot with limited resources. I would be happy to send my own kid here. But I think the fact that scholarship is not a required element of our work does our faculty a disservice. I don't want new faculty to be relieved that research and scholarship aren't required at Baker. I don't think we should hire the type of person who is relieved that scholarship is not required. I want Baker to be a place were faculty are challenged to develop their intellects, just as we challenge our students to develop theirs. And I want Baker to be a place where scholarship is both encouraged and supported.

I find it strangely comforting when . . .

2011-08-02T06:34:00.000-07:00

friends who profess to hate capitalism and corporations and who extol the virtue in buying local feel joy when assembling their new IKEA furniture.

Respite

2011-07-21T20:06:00.000-07:00

For the past two weeks (and for two weeks hence), I've been teaching a summer class to a group of students who will be officially entering college in the fall. It's an academic boot camp for them: four weeks, six credit hours, total immersion.

And it's total immersion for both student and teacher. Putting together two hours of activity each day, followed by grading homework and quizzes, is more than a full-time job. It's rewarding work, though, and the students are both totally overwhelmed and rising to the challenge. Makes me appreciate how underworked ordinary college students are, and strengthens my resolve to be tougher on them during the school year.

While all of this has been going on, I've completely ignored THE BOOK. Up to this point, THE BOOK has been an all-consuming activity: when I'm not writing, I'm thinking about writing, or wondering about the prospects for THE BOOK or musing on what I might want the cover of THE BOOK to look like.

For the first time in a long time, I haven't had the time to do that, and it's been good for me. Instead, I'm field-testing the book with my summer students, and reading it myself as I go. And I have to say (though some might say I'm a biased source) that it's not awful. Different than most textbooks, and certainly different in both style and substance than the ones I'm directly competing with. But it reads well, and I find it interesting enough (though if I found it boring I think that would be a really bad sign).

What the summer has done, then, is buoy my spirits about the project and strengthen my resolve to see it published. I'm happy with what I've done so far, and ready, once summer school is over, to see this project through to the end.

In the meantime, it's been a great rest.

Reviews

2011-07-06T10:53:00.000-07:00

I sent my manuscript to an acquisitions editor, whose job it is to screen proposals and pick likely looking proposals for further consideration. Part of that process is sending out manuscript submissions for review by people who teach the subject matter regularly.

My manuscript was sent out to five reviewers in June, and it took for-EVER for the reviews to come back! Well, it seemed like forever. But truthfully, each reviewer had about a hundred pages to look at and make detailed comments on, which is not a small undertaking.

When the reviews came back, sometime in October, the acquisitions editor and I spent about an hour on the phone dissecting them. The good news was that the reviews were generally positive. The bad news was that several of the reviews noted that my preliminary table of contents did not include coverage of a fairly major topic area.

That lack of coverage might turn out to be a deal breaker. More on this soon.

Some progress

2011-06-28T20:37:00.000-07:00

I've been chipping away at my book manuscript for the better part of two years . . . a chapter here, a chapter there. And I'm still five or so chapters away from completing the first draft. But today I had to put together what I've got, because I'll be teaching a summer school course that begins next week. I printed out the thirteen chapters I've completed, bundled them together, and took them to the mail and copy center to be copied and bound.

I know I'm a long way from being done. But it was very, very satisfying to pick up a spiral-bound copy of the work I've completed thus far. Flipped through it. Lotta words in there. Lotta hours tied up in it. Lotta problems and puzzles in there that took me years and years to figure out.

Hope it'll sell. But even if it doesn't, it'll be gratifying to hold it in my hands.

Publishers

2011-06-20T07:24:00.000-07:00

When it was time to send out the prospectus, sample chapters, and supporting materials for the textbook I've been working on, one natural question was, "Who do I send this to?"

There are, after all, lots and lots of companies that publish books. And if you run out of companies, you can always publish your manuscript yourself through amazon.com or lulu or any of a number of self-publishing companies. But publishing a textbook in today's market is a bigger project than simply putting the book together. Today, textbooks come with lots of ancillary materials: websites, instructor's manuals, student study guides, electronic homework services, and so on. For better or worse, if you want your book to be competitive with others in your niche, you need to have those materials available for the people that want them, which means that you need to work with a company that specializes in publishing textbooks.

Even more important, selling your manuscript to an established textbook company gives you access to that company's distribution network. The biggest companies didn't get that way by accident, and one key ingredient in their success recipe is that they have a sales force of representatives that make regular visits to college campuses, visit personally with instructors, and try to convince them to adopt your text. Nobody will buy your book if they don't know about it; access to a well-established distribution network makes finding a publisher specializing in textbooks crucial.

There used to be a lot of textbook publishers, but consolidation over the past fifteen or twenty years has cut the numbers significantly. Further, textbook publishers tend to specialize in particular fields. So when I was ready to send out my materials for review, I really only had about six publishers to choose from that I felt had the resources to make my book a commercial success.

I contacted both book representatives and acquisitions editors at those six companies, and forwarded each company my materials. Within a few days, I learned that one company was already developing a text in the same area with another author (so "Thanks, but no, thanks, we won't be reviewing your manuscript.") Another already publishes a couple of texts in the field already and wasn't anxious to put resources into a third. I got a much kinder rejection letter from them, including some helpful suggestions about my materials and a reference to a person at another company. I never heard anything back from three of the other companies at all, which made me a little sad.

But I struck gold with the sixth company, and thank goodness, because if I'd been rejected by everybody, I might have melted into a puddle. They were both interested in the text and anxious to send some chapters out for review by faculty members currently teaching the course. After a few quick phone calls and email exchanged with the acquisition editor, my chapters were sent off for review.

One hurdle jumped. Many, many more to go.

Entrepreneurship

2011-06-13T18:16:00.000-07:00

One of the virtues of the free market is that the lure of profits encourages people to apply their talents to helping others. The folks that invented and improved the automobile, air conditioning, the personal computer, made our lives richer and fuller and much, much easier. But they didn't invent these things because the loved us; they invented these things and brought them to market only because we were willing to pay for them.

For many, if not most, entrepreneurs, going into business means putting a great deal of financial capital at risk. For small operations, in particular, that capital often comes directly from the entrepreneur. Frankly, I'm a tightwad and I'm very risk-averse, which means that I've ruled out the ordinary path to being a self-made man. I prefer a steady paycheck, I prefer to keep my hard-earned dollars in one piece, and I would feel terrible for myself and my family if I risked our financial security on a business venture that failed. I can't begin to describe the respect I have for people who attempt to go it alone--they're much braver than I am, or they have much more confidence in themselves and their vision than I am ever likely to.

Writing the textbook that I'm currently working on is as close as I'll ever likely come to being my own businessman. Like the entrepreneur who opens a new store or invents a new product, I think my product is innovative enough, interesting enough, or of sufficient quality that others will want to buy it. If I'm right, the book may do well enough to fund a comfortable retirement. But like most entrepreneurs, I make a substantial investment before the end product ever hits store shelves, so if it's a dog, that investment disappears. Fortunately for me, my investment is largely measured in hours that probably would have been devoted to watching American Idol and the like, so if this project bombs, at least my savings account won't suffer. That makes me sort of a chicken, at least compared to others who sacrifice both their time and their money when they open a business, but I am what I am.

And that's what this project is going to be referred to from this day forward: Al's chicken-hearted foray into entrepreneurship.

Stage One: Finding a Publisher

2011-06-08T06:33:00.000-07:00

About four years ago, I found myself at a Chinese restaurant telling my wife that I had an idea for a textbook to accompany a college-level economics course. The idea was put on hold for a couple of years while we relocated, added a family member, and changed jobs, but after a couple of years the idea resurfaced and I began to work on it in earnest. Job one was finding a publisher for the thing.

There are enough people writing fiction that publishing houses find themselves with no shortage of completed manuscripts to read. But nonfiction is a different story, and academic work is even harder to come by. With a scarcity of new and original ideas in the economics textbook market, I didn't have to write the complete book before trying to find a publisher. Instead, I put together a shorter proposal with a few sample chapters of material.

It is the proposal that sells the idea behind your work.The proposal (called the prospectus) outlines the nature of the project, including a tentative table of contents, and it places the proposed book in context with its competitors. It points out the shortcomings of competing books and informs the publisher how the proposed mansucript remedies those shortcomings. It also attempts to establish a viable market for the project.

I sent publishers four sample chapters, complete with accompanying case studies and exhibits. I also sent descriptions of four in-class experiments, one to accompany each chapter. These experiments are one of the selling points of the manuscript--no other book in my market segment has active learning exercises to accompany the text, a point that I emphasized in the prospectus.

Before I sent out the packet, I had a well-trained formerly professional copy editor (who happens to be a good friend) carefully review everything I had written. I cannot overemphasize the importance of having a second set of eyes look over your work--especially if that work involves explaining things to other. Writing needs to be clear, concise, and comprehensible, and my editor-friend did an outstanding job of turning a decent manuscript into an excellent one. I paid her in booze, but truly the work she did for me was worth much, much more.

After a frantic couple of months putting the finishing touches on my samples, the time came when I could no longer think of any reason to wait. I sent my submissions and began to wait.

Okay, so it's been awhile . . .

2011-06-06T10:55:00.000-07:00

but I've had some reasons, maybe even good reasons, for neglecting this blog. First among those reasons is that I spent the spring semester at Harlaxton College as a visiting professor, which was a fabulous experience. And rather than duplicate my wife's efforts at blogging (which you can see at alnemgrant.com), I chose not to blog at all. The second reason is that much of my spare writing lately has been devoted to a textbook project that appear to be heading forward. I'm planning to share some thoughts and updates about that process here in the days, weeks, and months to come.

Pilgrims' Progress

2010-11-16T08:13:00.000-08:00

Next week marks my forty-fourth Thanksgiving holiday. I have much to be thankful for -- a terrific family, a job, some savings, a comfortable life. I was lucky to have been born in the greatest country on the planet, in a place where individual initiative often brings wonderful rewards.

But things were not always that way in America, and I thought it might be useful to look back at the Pilgrims' first few years, years when there was little enough to be thankful for. Those years were, in a word, bleak. By the end of the first winter, half the colonists had died, victims of disease and starvation. And while historians often credit the weather for those disastrous first years, a look back through the economist's lens reveals the true source of the economic chaos that reigned: the lack of private property.

Upon landing in the new world, the Pilgrims quickly established communal ownership of all pastures, and communal ownership of all agricultural production. As any introductory student of economics could predict, the result was underproduction and overconsumption, a net shortage of food.

How, then, did the Pilgrims achieve their first bountiful harvest? Governor William Bradford, noting that communal ownership "was found to breed much confusion and discontent and retard much employment that would have been to their benefit and comfort," assigned each family a parcel of land to do with as they pleased. Bradford writes, "This had very good success, for it made all the hands very industrious, so as much more corn was planted than otherwise would have been by any means the Governor or any other could use . . . "

Bradford's recipe worked, and it worked well. It was so successful that, as abhorrent as private property was to communist leaders, country after country in the communist bloc relied on similar schemes to feed their people. In the Soviet Union, private garden plots accounted for less than four percent of arable land, but were responsible for a third of total Soviet agricultural production.

Private property encourages harder work, smarter work, and more useful work. It encourages it through the promise of reward commensurate with effort, vision, and intelligence. Sometimes, of course, working harder or smarter fails to bring those rewards. Perhaps one's timing is wrong, or the market misunderstood. But private property gets it right more often than not, and it is only the system of private property that contains the promise of ever richer and more bountiful Thanksgivings to come. So this Thanksgiving, raise your glass to private property. It's earned your thanks .

2010-11-09T19:01:00.000-08:00

I believe that universities should hire people with Ph.D.s not because they want people who have achieved distinction in the past, but because they want people who will achieve distinction in the future.

It's the thought that counts . . .

2010-10-26T07:22:00.000-07:00

Why spend perfectly good money on a gift someone will hate when you can find something they'll hate just as much in your own basement?

2010-10-22T12:48:00.000-07:00

I believe that when a university becomes unable to staff its course offerings to the point that students are regularly enouraged to fulfil their requirements at a different institution, that university is being overly ambitious in both its course offerings and its requirements.

I Know It Pisses You Off, But

2010-10-13T09:33:00.000-07:00

Last week, former Chairman of the Council of Economic Advisors and current Harvard University professor Greg Mankiw asserted that if the Obama administration rolled back the Bush tax cuts, he might no longer write a column for the newspaper. After taxes, there simply isn't enough reward in it. This, of course, has infuriated those who support the tax increase; one colleague of mine (and a colleague that I respect, like, and appreciate) responded with a resounding, "Oh, what a freaking selfish prick is Mankiw . . . "

And my friend may be right (though I cannot claim to have knowledge whether Mankiw is either freaking or selfish or a prick), but my friend misses two very important points. First, whatever he thinks of Mankiw and his selfishness, Mankiw is demonstrating that actions have consequences--if you increase the tax on an activity, you'll get less of it. Study after study has demonstrated that even addictive behaviors like smoking respond predictably to taxation. And so, if you increase the tax on being wealthy, which often follows as a result of taking unusual risks or having extraordinary talents, then you'll get fewer people taking risks and fewer people exercising their talents. And it should not come as a surprise that the rich are more sensitive to tax changes--increase income taxes on someone whose budget is tight, and they'll still go to work every day. But the rich, with income beyond their needs, have the luxury of simply reducing their effort with little consequence for their lifestyle.

In other words, Mankiw is purposefully and pointedly, through his actions, making the larger point that there are thousands and thousands of people at the top of the income ladder whose behavior will mimic his own. And perhaps these people, too, are all freaking selfish pricks. But that's out of your hands, my friend, and irrelevant for policymakers who must, when designing policy such as a tax increase, account only for the rich's behaviors and not their attitudes. Raising taxes will reduce investment and innovation and activity, and you may not like that, but it is what it is. No matter how much lipstick you put on a pig, it's still a pig.

The second point that eludes my friend, when he calls Mankiw a selfish freaking prick for cutting back work when taxes rise, is this: It's. Not. Your. Money! My friend wants Mankiw to continue working, regardless of the cost or benefit to Mankiw. And he wants this not because it does Mankiw any good, but because when Mankiw works, my friend receives the benefits Mankiw's taxes provide. And so my friend asks Greg Mankiw, who is no stranger to hard work, to work some more and pay some more so that my friend can pay less.

And so, dear friend, I ask the same of you. If you really believe that it's okay to ask Mankiw to work out of the goodness of his heart so that your life can be a bit easier, then it seems only fair that you to sacrifice your evenings and your weekends and take a job at the Home Depot or Baldwin City Market so that others' lives would be easier. And make it a low-paying job, please, or donate your salary to the federal government, because I want you to know in your heart that you are not working for the money it brings you (lest someone have the temerity to call you a freaking selfish prick), but so that the taxes you earn can be put to good service helping those below you on the income ladder.

In the end, it's not really the money we're talking about, it's the work. Mankiw wishes to work less, and you condemn him for it. If you are to point an accusing finger at those richer than you who don't wish to fill their every waking moment with work on your behalf, then you must also be willing to stand in their shoes and fill your every waking moment with work on behalf of those poorer than you.

The President's Right-hand Man has resigned . . .

2010-09-27T06:06:00.000-07:00

Not Joe Biden, but Lawrence Summers, his chief economic advisor. Summers will return to Harvard, where he has a professorship in economics, and where more famously he was pressured to resign as president after making some much-misinterpreted comments about the abilities of men and women in science.

Summers has had a distinguished academic career (it does take some qualifications to get tenure at Harvard, after all), and is known predominantly as a macroeconomist. Perhaps this is why he was tapped to serve as Treasury Secretary under Clinton. But one of the pieces of his work (with Andrei Schleifer and Lawrence Katz) I find most interesting cuts to the core of family relations: how often children visit their parents in nursing homes. Here is their work in a nutshell:

1) Children of rich parents visit more often than children of poor parents.
2) Result 1) holds only if there is more than one child.
3) In the instance of one-child families, there is no difference in visitation rates among rich and poor.

In other words, children visit their nursing-home-ridden parents because there's money on the line. But money is only on the line when there's competition for that money in the form of siblings.

Ah, family!

Something Pithy:

2010-09-19T09:59:00.000-07:00

One of my all-time favorite students bestowed this bit of wisdom on me: Declaring something 'priceless' is just a way to get people to pay nothing for things that are worth something.

A short one-liner . . .

2010-09-16T10:43:00.000-07:00

I believe there is a big difference between a society in which 95% of the people decide to each sacrifice a little to help the other 5%, and a society in which 90% of the people agree to take a lot from the remaining 10% and parcel it out among themselves.

A short note on growth and horses and life at Baker

2010-06-25T08:28:00.000-07:00

At the dawn of the 20th century, no less a respected publication than Scientific American reported that economic growth in Manhattan was about to reach its limit because the island could not support any more horses.

Economic growth did continue continue in Manhattan in spite of its equine capacity, largely because people found new ways to use the space they had more efficiently. The lesson to learn is that economic growth stems not from cramming more horses onto your island, but from figuring out new, smarter, better ways to use the island that you've got.

Fast forward a hundred and ten years to Baker University, the little university that tried to be big. Truth be told, the marketplace is tough--Baker looks a lot like a thousand other small, struggling, liberal arts colleges. To compete, Baker tries to offer as many opportunities as possible to its students. We have dozens of sports teams, organizations, honor societies, and fraternal organizations. And that's just for students (and a relatively small student body it is). As faculty (and a relatively small faculty it is), we're advising or sponsoring those groups, serving on committees and task forces, supervising internships, and advising students. This in addition to teaching a heavy load of classes and trying to stay current in our fields.

Last year, I served as a faculty advisor to a student group. The group suffered, as groups sometimes do, from lack of mission. The meetings were poorly attended, and in a vicious spiral of causation, the main topic of conversation at each meeting was how to get more students to come to meetings.

This exercise in absurdity is symptomatic of a life in which people are stretched too thin to give their full attention to the pursuits they have chosen. Baker will not distinguish itself, nor will it effectively compete with its rivals, if its faculty and students persist in the attitude that growth occurs because we've crammed more opportunities, activities, committees . . . horses onto our little island. True growth, the growth that allows a village to become a New York City or a Baker to become a Harvard, comes from doing fewer things, but giving them the time and attention necessary to do them better than anyone else.

In that spirit, this year I plan to spend less time worrying about "more and more," and more time focusing on "better and better."

Enough of the broken windows, already!

2010-04-15T09:49:00.000-07:00

President Obama has assembled an economic team with tremendous brainpower. These guys are super. Really. So it's pretty amazing to me that the collective wisdom of that team must surely have been ignored when the administration created this little project:

Part 1: "We, the U.S. Government, will purchase your used car for $4,500 if you buy a new vehicle."

Okay, so some might find that part of the plan objectionable--government is not generally in the habit of subsidizing our purchases, and some training in economics will allow you to show that every dollar car buyers receive from the program costs someone else (we don't know who, but why quibble) a bit more than a dollar. But we were in a recession, and car companies were having a hard time, so if government believes that the auto industry is important and needs to weather the storm, I at least understand that. It's the second part of the plan that I find absolutely stunning:

Part 2: "After we purchase your used car, we will destroy that car by pouring molten glass into the motor."

So if the goal of propping up ailing automakers is accomplished by part 1, then why the need for part 2? All the plan does is take a perfectly good car that someone might have gotten a great deal of use from--perhaps someone who couldn't afford a new car even with the subsidy--and destroy it in the name of job creation.

That car simply becomes another broken window. And the lesson for Obama's economic team is that they should try harder to impress upon our policymakers that nobody--not a gang of hooligans, a hurricane, or a government--can create wealth by destroying wealth.

Meet Cooper!

2010-04-02T12:31:00.001-07:00

I warned you that this wasn't going to be an "all-business" blog, didn't I? So meet my little boy, Cooper!

More broken windows . . .

2010-03-31T06:36:00.000-07:00

Of course, the idea that the broken window created a flurry of economic activity is neither new nor particularly original. One hears the same thing about wars -- "WWII pulled us out of the Great Depression" -- and about natural disasters -- "Hurricane Andrew created thousands of jobs in Homestead, Florida."

The problem with such reasoning is this: it is true that the broken window made our guy spend money with the glass dude, who could then buy a TV, who could . . . But here's what's often ignored: what might the first guy have done with his money if he didn't have to spend it on a new window? Perhaps he would have spent it on a flat panel television. Or perhaps he would have put it in the bank, where someone could have borrowed it to buy a new car. Either of these actions would have touched off just as much spending as the broken window did.

The point is that in the first case, we get a lot of spending. But in the second case, we get exactly the same amount of spending and we save ourselves a broken window. WWII was indeed a great thing for the American economy, unless, of course you count the half-million people who died and all of the tanks, jeeps, ships, and planes that were destroyed in the process. And those jobs in Homestead were jobs created simply to replace what had been destroyed, not to create anything new.

When we evaluate the impact of an event, it is not right, accurate, or fair for us to look only at the benefits, we must also look at the costs.

About broken windows . . .

2010-03-29T09:48:00.000-07:00

A man wakes one morning to find that some punks have thrown a rock through his living room window. He calls his window dude, and the window guy rushes out to replace the window at a cost of a few hundred bucks.

The window guy is now a few hundred dollars to the good, and after all, it's March Madness, so he rushes to the appliance store to buy a flat-panel TV.

The appliance salesman had been wondering how he was going to pay for his daughter's college tuition, but no more. With the few hundred bucks he received from the window guy, his daughter is free to take that econ class she's always wanted.

The econ professor has been needing some new suede patches on the elbows of his sportcoats, so he takes the appliance guy's money and . . . well, you get the picture by now. Just look at all of the economic activity, all of the income, that has been created by that broken window.

Aren't we lucky that window got broken?

And if breaking windows makes a society rich, then maybe we should hire those young punks to go out and break some more.

The town in the photo above is surely very wealthy.

Immigration and Free Trade

2010-03-26T06:57:00.000-07:00

It's fascinating to me how many people are advocates of free trade but opposed to free immigration. You can import your labor in human form, or you can import it embodied in a product or service. In either case, you are hiring an foreigner to perform work for you; where the work actually gets performed is largely immaterial.

Sunk Costs are Sunk

2010-02-23T19:24:00.000-08:00

One of the cornerstones of economic analysis is what we call "marginal thinking." Marginal thinking simply means that we look forward one step from wherever we happen to be, compare costs and benefits of actions that we're considering, and take those actions whose benefits outweigh their costs. It takes some calculus to prove, but making marginal decisions in this way tends to produce the highest level of available well-being for those that practice it.

Despite the fact that we do marginal analysis every day, it's still easy to fall into the trap of chasing sunk costs. Sunk costs are costs that have already been incurred; the saddest thing about sunk costs is that no matter how badly you want to, or how hard you try, you cannot get them back. And making decisions based on what has already occurred violates the forward-looking principles of marginal analysis.

Consider, for example, the moviegoer who plunks down $15 to sit through what might possibly be the worst movie of all time: "Dude, Where's My Car?" Within minutes, the moviegoer knows the movie will be terrible, but sits through the rest of the movie because, "I've already bought the ticket." Or the college senior who discovers that she hates French literature and never wants to speak another word of French, but continues taking courses in the major because, "I've already got 20 credit hours." Both of these people are choosing an action based not on what is to come, but what has gone before. The moviegoer should be asking, "What else can I be doing with the next two hours that is better than watching this stinkpot of a film?" The student should be asking, "What field of study can I choose that I will enjoy more than this stinkpot of a major?"

I recently found myself guilty of chasing sunk costs when I spent the weekend with a friend of 32 years. At the end of the weekend I realized that I really don't like him, have not liked him for many years, and that I spend time with him primarily because we have a shared history. My friend is a human version of "Dude, Where's My Car," and it's time I realize that this is one movie that's not going to get better if I wait. Every minute I spend indulging my once-friend is time away from more valuable uses...and so I'm walking out of the theater.

Assessment

2010-02-18T09:26:00.000-08:00

One thing that universities need to do is answer the question, "Are our students learning what we want them to?" The process by which that answer is found is called "assessment," and the answers are supposed to inform us of where we need to make changes in our programming. I understand the goals of assessment, but I often get frustrated by the language and culture of assessment, and I often lament that for many, the process is more about the data than it is about using the data to make positive changes to programs. Furthermore, assessment involves lots of data gathering and analysis, both of which tend to happen at the busiest times of the semester. Isn't it serendipitous, then, that I am the semi-official department assessment coordinator?

Recently one of my colleagues who has been doing mostly administrative work decided to return to the department full time. Last night, Judy emailed me and asked if she could take over as department assessment coordinator. Here was my response, lifted wholesale from a source much more talented than I:

“Why, it’s you, Judy! I warn’t noticing.”

“Say - I’m going in a -swimming, I am. Don’t you wish you could? But of course you’d druther do assessment - wouldn’t you? Course you would!”

Al contemplated the woman a bit, and said:

“What do you call work?”

“Why, ain’t that work?”

Al resumed his assessing, and answered carelessly:

“Well, maybe it is, and maybe it ain’t. All I know it suits Alan Grant.”

“Oh, come now, you don’t mean to let on that you like it?”

The magic assessment pen continued to move.

“Like it? Well, I don’t see why I oughtn’t to like it. Does a guy get a chance to assess learning outcomes every day?”

That put the thing in a new light. Judy stopped nibbling her apple. Al swept his pen daintily back and forth - leaned back to note the effect - added a touch here and there - criticized the effect again - Judy watching every move and getting more and more interested, more and more absorbed. Presently she said:

“Say, Al, let me assess a little.”

Al considered, was about to consent; but he altered his mind:

“No-no-I reckon it wouldn’t hardly do, Judy. You see, Dean Flaherty’s awful particular about this summative assessment - right here in the public eye, you know - and if it was just low-level formative assessment, I wouldn’t mind, and he wouldn’t. Yes, he’s awful particular about summative assessment; it’s got to be done very careful; I recon there ain’t one person in a thousand, maybe two thousand, that can do it the way it’s got to be done.”

“No-is that so? Oh, come now - lemme try. Only just a little - I’d let you, if you was me, Al.”

“Judy, I’d like to, honest injun; but Dean Flaherty - well, Gary wanted to do it, but he wouldn’t let him; Kevin wanted to do it, and he wouldn’t let Kevin. Now, don’t you see how I’ fixed? If you was to tackle assessment and anything was to happen to it --”

“Oh, shucks, I’ll be just as careful. Now lemme try. Say - I’ll give you the core of my apple.”

“Well, here - No, Judy, no you don’t. I’m afeared --”

“I’ll give you all of it!”

Al gave up the assessment pen with reluctance in his face, but alacrity in his heart. And while Judy worked and sweated over the assessment, the retired department assessment coordinator sat on a barrel in the shade close by, dangled his legs, munched his apple, and planned the slaughter of more innocents.

Perfection

2010-02-11T13:07:00.000-08:00

I'm an academic economist by day, which means that my job is to help students develop a working understanding of economics. It turns out that economics is hard to learn for some--economists think in strange ways about problems, and we use graphical tools that are abstract and hard to learn. Students, even the best students, rarely walk out of an econ course feeling as if they have mastered the material. Students might be encouraged to learn that I've been studying economics for 25 years, and I don't feel as if I've mastered the material either.

But rather than being encouraged, some might feel that because they're learning their economics from less than a master, they are being cheated out of what they paid for. I might be tempted to feel guilty about that. But at night, I hang up my economist hat and put on a woodworking hat. I love working with wood, reading about working with wood, and thinking about wood. There are a few woodworking giants whose names pop up everyhere woodworkers gather--among them are Roy Underhill, James Krenov, and Sam Maloof.

Roy Underhill hosts the longest-running woodworking show on television, "The Woodwright's Shop." He was for many years the housewright in Colonial Williamsburg, works only with hand tools, and is known by his devotees as "St. Roy," because he's cut himself so many times on the air (his shows are always shot in one continuous take) that it's a miracle he's alive. He is charming and charismatic and perhaps the most beloved soul in woodworking.

James Krenov, recently deceased, made his name by crafting high-end cabinetry. Later, he opened the most famous woodworking school in America, where he perfected a type of handmade wooden plane that came to be known worldwide as a Krenov-style plane.

Sam Maloof made chairs--chairs unlike any that had ever been seen before, with traditional bones and natural and contemporary lines. His work has spawned a slew of imitators who produce knockoffs that are referred to only as "Maloof-style chairs."

Here's why I mention these icons: they are not perfect. Roy Underhill's books are full of pictures of tables and boxes and chests that he's literally crafted out of trees--this is pretty amazing to me. And yet, if you look at the pictures closely you'll often see torn and splintered wood, mis-cut pieces, and gappy joints. James Krenov, crafter of some of the finest furniture in the world, chose as the cover of his "Cabinetmaker's Notebook" a photo of a jewelry box that clearly shows where he mis-marked his joints with a knife and had to strike a second line. And Sam Maloof used *gasp* metal screws to hold his chairs together instead of more traditional wood-to-wood joinery.

Roy's boxes, James' cabinets, and Sam's chairs all do what they are supposed to, and all are probably far finer than I will ever produce. Yet these three giants are not ashamed to display the errors and imperfections in their work. They know that, master craftsmen though they may be, they will never totally master the wood they use.

Students of economics, take heart. You might not master economics, but that doesn't mean that you can't be good enough at it to produce a useful, and even beautiful, end product.

A new semester begins...

2010-01-26T12:20:00.000-08:00

So tomorrow is the first day of classes for the spring semester of 2010. I've just had six weeks off, and yet I'm still not ready for classes to begin. Even my course syllabi are not yet done, as I am a living example of the philosophy, "Never put off for tomorrow what you can put off for the day after."

Nevertheless, I'm excited about the semester beginning, and nervous about what I'm going to cover in class. Even after fifteen years of doing this, my courses and style continue to evolve, at least incrementally. One of the projects that I've committed to this spring is to post regularly to a departmental blog. This is that blog, though it will also contain things of a personal nature because, frankly, I'm too flighty to regularly contribute to more than one writing space.

So welcome back, eager students. Next time I write, it will be about achieving perfection.

What would Milton say?

2009-09-08T21:58:00.000-07:00

I'm doing some wordsmithing, and am up against it. The idea is not original (I did plug the phrases into google to see if I'd inadvertently lifted them from somebody else, and so far I think I'm in the clear. Please advise if you know otherwise)--but I am hoping to express it forcefully. I've narrowed it down to two alternatives, and if you'd help me choose, it would be appreciated.

"The unfortunate thing about free speech is that you often get exactly what you pay for."

"The unfortunate thing about free speech is that you often get your money's worth."

And if you'd be willing to channel the spirit of the late, great Milton Friedman in making your choice, please do so.

A video from Cooper

2008-06-04T17:56:00.000-07:00

First Post...

2007-05-03T05:27:00.000-07:00

After a long absence, I'm returning to Baker University to teach once again.

Ten years ago, I spent a year at Baker filling in for Stuart Dorsey, who had been appointed interim Academic Dean. With the exception of the year I spent on sabbatical in Palau (while my darling wife worked), it was the best year of my life.

This spring, I got the opportunity to come back, and though I love my current job and though I'm well-settled in central Illinois, the chance to return to Kansas, where my family is and my heart lies, was too much to pass up.

Not that that's all that has motivated me to return--after all, I've been gone a decade, and there have been plenty of chances to apply for jobs in Kansas during that time. But I was waiting for the right job to come along, and it took ten years to materialize. When it did, it was right back at BU. How exciting! I've got to tell you, I can't wait to be back in the small-college atmosphere again!