Walker

Walker joined Difficult Run as an editor in August 2013. He graduated from the University of North Texas with an MBA in Strategic Management and a BBA in Organizational Behavior and Human Resource Management. He's currently a grad student in Government at Johns Hopkins University. He has been published in SquareTwo, BYU Studies Quarterly, Dialogue, Graziadio Business Review, and Economic Affairs. He also contributed to Julie Smith's (ed.) 'As Iron Sharpens Iron: Listening to the Various Voices of Scripture'. His other online writing can be found at Worlds Without End and Times & Seasons. He lives in Denton, Texas, with his wife.

Who Are Minimum Wage Workers?

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Economist Mark Perry has an interesting blog post summing up the Bureau of Labor Statistics report “Characteristics of Minimum Wage Workers, 2014.” The following provides the percentages of different groups earning the minimum wage or less:

Age: 16-19 (15.3%), 25+ (2.5%).

Education: Less than high school (7.3%), High school graduates (3.5%), Associate’s degree (2.2%), Bachelor’s degree (less than 2%).

Marital Status: Never married (6.7%), Married (1.9%).

Hours Worked: Part-time (9.5%), Full-time (1.8%).

Perry summarizes,

Four important factors that will help workers earn a wage above the federal minimum wage are: 1) age (experience), 2) education, 3) marital status and 4) hours worked. Only 1-in-40 workers age 25 and above make the minimum wage, only 1-in-45 workers with an associate’s degree or higher makes the minimum wage, only 1-in-53 married workers earns the minimum wage, and only 1-in-56 workers working full-time earns the minimum wage. The evidence seems clear that the minimum wage applies only to a very small group of young, inexperienced, single, part-time workers, with a lack of education.

Check out the full report. In debates over the minimum wage, we should consider these demographics and take into consideration how much life experience–including work, education, marriage–plays into economic mobility.

Constructing ‘Cool’ and the Myths of Consumerism

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Last year, The Atlantic reported on a study that offered a plausible definition of “cool.” “Cool,” The Atlantic said,

means departing from norms that we consider unnecessary, illegitimate, or repressive—but also doing so in ways that are bounded. The 1984 Apple ad that said, essentially, “you have a choice; don’t buy IBM!” was considered one of the coolest commercials of all time, because it was, in the researchers words, “autonomous in an appropriate way.” But a 1984 Apple ad saying “you have a choice; don’t pay federal income taxes!” wouldn’t be cool, because taxes are legitimate; and a 1984 Apple ad saying “burn IBM’s headquarters to the ground!” wouldn’t be cool, because that’s just overdoing it. Cool requires a bit of Goldilocks. It also requires something worth rebelling against.

The magazine recently interviewed a pair of neuroscientists on the same topic. “Cool,” according to these researchers, emerged in the 1950s. “Why were people getting so rebellious during one of the greatest periods of economic expansion in our history?” they ask. They conclude that it was because “the competition for the limited status of a traditional social hierarchy was getting too intense. It was the right conditions for the rebel instinct to ignite, and it started to drive consumption through rejecting the traditional routes to status and creating cool new lifestyles.” Cool, as the article name makes explicit, was created by capitalism and growing consumerism.

However, one of the most interesting parts of the interview was the list of four “damaging” myths about consumerism:

1. “It doesn’t make us happy.”

In 1974, Richard Easterlin reported that although richer people were happier than poorer people in the same country, people in wealthier countries were no happier than those in poorer ones. The implication was that happiness depended on relative income—how we stack up against the proverbial Joneses. But new studies question whether there ever was an Easterlin Paradox: The people of sub-Saharan Africa are not as satisfied with their lives as people in India, who are not as satisfied with their lives as the people of France or Denmark. There’s a global relationship between income and life satisfaction that shows no sign of a satiation point.

2. “It relies on instilling false needs in us because it’s contrary to our real nature.”

Our research show why the second myth is false. By examining how the brain responds to “cool” products, we discovered that they help fulfill a basic human need: to be recognized and respected by others. Our brains contain what’s basically a “social calculator” that keeps track of how we think other people are thinking about us—we feel its results as social emotions like pride and shame. Today, it’s typically called “social status,” but that has lingering negative connotations. We found that products are basically extensions of ourselves that reflect who we are—we use them to bond with others who share the same values. Doing this successfully was key to survival throughout human evolutionary history—you really needed allies, friends, and partners to survive.

3. “It erodes public life.”

There are lots of ways to gain status—it’s what even drives some Westerners to join ISIS—but integrating our need for status into the economy was, in our opinion, an enormously important feat. It allows the ways to gain status to expand over time, and it shows why the third myth is false—we use products to create lifestyles and community.

4. “It’s primarily about “stuff.””

Consumerism isn’t just about materialism. We use products socially—music is a great example. Look at all the lifestyles arranged around various musical tastes.

Check out the whole interview.

Taxing Inventors Out of the Country

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New research reveals that high taxes may (unsurprisingly) deter inventors from remaining in a country. The authors summarize their findings:

There has is a strong and significant correlation between top tax rates and those inventors who remain in their home countries. The relation is strongest for superstar inventors…The elasticities imply that for a ten percentage point reduction of top tax rates from 50% to 40%, a country would be able to retain on average 3.3% more of its top 1% superstar inventors. This relation weakens as one moves down the quality distribution of inventors – the top 25-50% or the bottom 50% of inventors are no longer sensitive to top tax rates.

…The recent evidence suggests that labour, like capital, might be internationally mobile and respond to tax incentives. The loss of highly skilled agents such as inventors might entail significant economic costs, not just in terms of tax revenues lost but also in terms of reduced positive spillovers from inventors and, ultimately, less innovation in a country.

Food for thought.

1.5 Million Missing Black Men

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A recent piece from The New York Times describes what can only be called a staggering, haunting, and horrific picture:

In New York, almost 120,000 black men between the ages of 25 and 54 are missing from everyday life. In Chicago, 45,000 are, and more than 30,000 are missing in Philadelphia. Across the South — from North Charleston, S.C., through Georgia, Alabama and Mississippi and up into Ferguson, Mo. — hundreds of thousands more are missing.

They are missing, largely because of early deaths or because they are behind bars. Remarkably, black women who are 25 to 54 and not in jail outnumber black men in that category by 1.5 million, according to an Upshot analysis. For every 100 black women in this age group living outside of jail, there are only 83 black men. Among whites, the equivalent number is 99, nearly parity.

African-American men have long been more likely to be locked up and more likely to die young, but the scale of the combined toll is nonetheless jarring. It is a measure of the deep disparities that continue to afflict black men — disparities being debated after a recent spate of killings by the police — and the gender gap is itself a further cause of social ills, leaving many communities without enough men to be fathers and husbands.

Perhaps the starkest description of the situation is this: More than one out of every six black men who today should be between 25 and 54 years old have disappeared from daily life.

…The disappearance of these men has far-reaching implications. Their absence disrupts family formation, leading both to lower marriage rates and higher rates of childbirth outside marriage, as research by Kerwin Charles, an economist at the University of Chicago, with Ming-Ching Luoh, has shown.

The black women left behind find that potential partners of the same race are scarce, while men, who face an abundant supply of potential mates, don’t need to compete as hard to find one. As a result, Mr. Charles said, “men seem less likely to commit to romantic relationships, or to work hard to maintain them.”

Arguments over racial disparities are sensitive and more often than not heated (just take a quick look at your Facebook feed regarding Baltimore). Blame is placed in various places, from systemic and institutional racism to individual choice and accountability. I have my own opinions (largely a mixture of the two), but that isn’t what I’m interested in with this post. Put aside the finger-pointing, the outrage, and the judgment for a moment. Just look at those numbers and think of the human faces behind them. And then weep.

Harvard’s Roland Fryer, Clark Medalist 2015

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Harvard economist Roland Fryer was awarded the 2015 John Bates Clark Medal by the American Economic Association. Many top economists have been the recipients, from Milton Friedman to Paul Krugman. But as The Economist points out,

Mr Fryer’s prize…stands out. Top academic economists tend to be white. They often hail from privileged backgrounds and build their reputation on inscrutable econometrics. Mr Fryer does not fit that mould. He is the first African-American to win the medal (after having in 2007 become the youngest African-American to receive tenure at Harvard, at age 30). Mr Fryer’s childhood was not an easy one. He grew up poor, and was abandoned by his mother and beaten by his father as a child. As a teenager he survived by selling counterfeit handbags and dealing marijuana. Perhaps not coincidentally, his research agenda is heavily focused on investigations of real world policy questions. Mr Fryer has used economic tools to study America’s racial divide and to explore how it might be narrowed—economic questions that historically have been understudied. Economics, as a field, seems slow to appreciate the possibility that the introduction of new perspectives can mean that more interesting questions get asked, leading to better answers.

The AEA summarizes his work as follows:

His innovative and creative research contributions have deepened our understanding of the sources, magnitude, and persistence of U.S. racial inequality.  He has made substantial progress in evaluating the policies that work and do not work to improve the educational outcomes and economic opportunities of children from disadvantaged backgrounds.  His theoretical and empirical work on the “acting white” hypothesis of peer effects provides new insights into the difficulties of increasing the educational investments of minorities and the socially excluded.  Fryer is the leading economist working on the economics of race and education, and he has produced the most important work in recent years on combating the racial divide, one of America’s most profound and long-lasting social problems.

I first came across Fryer as an undergrad. My wife at the time was taking a sociology course in preparation for dental hygiene school. His work came in handy when she had assignments regarding racial inequality in America. I’ve tried to keep up with his work over the years. I was very excited to see him awarded.

Be sure to check out the AEA link above or this link to Bloomberg for a more in-depth overview of his research.

The Lost Pages of ‘A Wrinkle in Time’

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The Wall Street Journal has an exciting piece on 3 newly discovered pages cut from prior to the publication of Madeleine L’Engle’s classic A Wrinkle in Time. The pages were discovered by L’Engle’s granddaughter, Charlotte Jones Voiklis. The new pages feature a conversation between Meg and her father.

…Meg has just made a narrow escape from Camazotz. As Meg’s father massages her limbs, which are frozen from a jarring trip through space and time, she asks: “But Father, how did the Black Thing—how did it capture Camazotz?” Her father proceeds to lay out the political philosophy behind the book in much starker terms than are apparent in the final version.

He says that yes, totalitarianism can lead to this kind of evil. (The author calls out examples by name, including Hitler, Mussolini and Khrushchev.) But it can also happen in a democracy that places too much value on security, Mr. Murry says. “Security is a most seductive thing,” he tells his daughter. “I’ve come to the conclusion that it’s the greatest evil there is.”

Ms. Voiklis said she wanted readers to know the book wasn’t a simple allegory of communism. Instead, it’s about the risk of any country—including a democracy—placing too much value on security. The tension between safety and personal freedom is an idea that resonates in today’s politics.

Check out the WSJ article and the pages themselves.

Does a Welfare State Encourage Entrepreneurship?

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It might, according to some economic research.[ref]Though economists like Alex Tabarrok think too much money is spent on welfare and not enough on research.[/ref] As AEI’s James Pethokoukis explains,

Image result for welfareOver at The Atlantic, Walter Frick offers economic literature roundup that suggests the latter. A strong safety net encourages startups by making the effort seem less risky, he argues. For instance, a 2014 paper found the expansion of food stamps “in some states in the early 2000s increased the chance that newly eligible households would own an incorporated business by 16 percent.” Another paper by the same author found that “the  rate of incorporated business ownership for those eligible households just below the cutoff was 31 percent greater than for similarly situated families that could not rely on CHIP to care for their children if they needed it.”

However, he notes,

Now it is one thing to argue that a more robust safety net would be good for US entrepreneurship broadly understood — I think that would be the case in some areas, though I would be careful about eliminating welfare work requirements — and quite another to make the same claim about  mimicking the Scandinavian social democracies. In “Can’t We All Be More Like Nordics?”, Daron Acemoglu, James Robinson, and Thierry Verdier argue that “technological progress requires incentives for workers and entrepreneurs [and] results in greater inequality and greater poverty (and a weaker safety net) for a society encouraging more intense innovation.” If cut-throat, inegalitarian US capitalism became more like cuddly Scandinavian capitalism, the US might no longer be as capable of pushing the technological frontier…Indeed, the researchers have found a large per-capita gap between Scandinavia and the US when it comes to highly cited patents. The US also has a high-impact entrepreneurship rate three times as high as Sweden. (Of course, open economies benefit from innovation first produced elsewhere.) In short, the US has a pretty special thing going, and we should be careful not screw that up.

Worth checking out.

Spirituality Leads to Happier, Healthier Children

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So says a recent article in TIME by psychologist Lisa Miller. “An increasingly narcissistic culture and the constant reward for achievement,” she writes

whether on the playing field, the music stage or the math test, creates what I call in my book the unbalanced “performance self” of the child; a child who feels his or her worth is founded on ability and accomplishment…Children come to believe they are no better than their last success and suffer a sense of worthlessness when there is loss or even moderate failure. Where love is conditional on performance, children suffer.

Now the antidote. A new study just published online in the Journal of Religion and Health by my lab at Columbia University shows that happiness and the character traits of grit and persistence go “hand in hand” with a deeper inner asset: spirituality, which this study measured as a deep spiritual connection with a sense of a sacred world. More generally my research of more than 20 years on adolescence, depression and spirituality shows more specifically how putting a priority on performance stunts development of a child’s inner life and the single most powerful protection against depression and suffering, the spiritual self.

Not only does the article demonstrate the importance of spirituality, but also the harmful effects of a status and achievement-driven culture.[ref]I would imagine that the mixing of the two is even more harmful.[/ref] Check it out.

“Tell Me…Do You Bleed? …You Will”: Batman v Superman Trailer

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I wasn’t too mortified when it was announced that Ben Affleck would play Bruce Wayne/Batman in what is now called Batman v Superman: Dawn of Justice. While I prefer his brother Casey as an actor and often wish Ben would remain behind the camera (Gone Baby Gone, The Town, and Argo are all great), he’s not a terrible choice. Many point to how awful Daredevil was, but that had little to do with Affleck (who did the superhero scenes fairly well) and more to do with idiotic scenes like this. Whatever the complaints, he looks pretty rad in the trailer below, especially with the brief voice-over by the most welcome Jeremy Irons. Let’s hope the movie lives up to its potential.