Links to Consider
Tyler Cowen on Harvard; Moses Sternstein on generational differences in media use; Razib Khan on same; Kevin Erdmann on "high-productivity" cities
I had never looked at the Harvard board before. So I was naive. But in fact the board of “the Corporation” is a big, big disappointment (WSJ), relative to the rest of the institution. Harvard seems to do best when the relevant decisions are not being made by the governing board. More fundamentally, viewed as a political economy problem, I don’t see which are the institutions or incentives in place to make the board really, really good, as it ought to be. Nope. So this month I learned something big about Harvard.
I have to say that you won’t see me getting on any “blame the board” bandwagon. Faculty are traditionally the main force at a university. And Harvard’s faculty drove out Larry Summers from its Presidency and backed Claudine Gay.
In the 21st century, one of the most important questions for Harvard is this:
Are students, faculty, and administrators to be selected for the content of their character or for the shape and color of their genitalia?
Harvard has chosen the wrong answer, as have many other institutions. A thorough, close-up historical analysis of how Harvard came to get this wrong would be a worthwhile project for an investigative journalist. I suspect that explanations based on any single causal factor will not hold up.
52% of Youngs say they discover new brands on new media (TikTok, YouTube, Insta), as opposed to 19% for the Olds and the Mids.
Young = Gen Z. Olds and Mids = millenials and older.
I have no handle at all on Gen Z. When I taught high school, I got along with the millenials. As they started to give way to Gen Z, I had more difficulty relating to them. At the time, I thought that it was just that I was getting older.
Two years ago, journalist and entrepreneur Antonio García Martínez declared that we were entering a new “age of orality.” By this, he meant that the primacy of text was declining in our culture, as younger generations preferentially consumed audio content over magazines. Perhaps Martínez could even have stipulated that this was the age of “audiovisuality.” Anyone producing podcast content knows that the “Zoomer” generation, those born after 1995, prefer not to subscribe to a feed proactively. Instead, they spend their days passively “consuming content” by leaving YouTube in the background at length. Nearly 40% of this generation spends four or more hours a day on social media, and 88% use YouTube.
Note that Boomers were wont to leave on one of the three TV networks, passively consuming whatever came on. In fact, a show’s success depended on having a popular “lead-in,” meaning the show on that network that preceded it.
Note also that we can have Martínez and Andrey Mir duke it out over who gets to claim to have spotted the trend toward orality. We definitely will discuss Mir some time early in 2024. Have you started to read his Digital Future yet?
Let’s just change one thing. Everything is the same in both cities. Population. Productivity. Cost of living. Weather. But, let’s say City B puts a moratorium on new housing. What’s going to happen?
What happens is that poor people get priced out of the market in city B, so they move to city A (which has no building restrictions). That is, poor people move out of SF and migrate to Texas. Erdmann suggests that a naive economist might think: Look at how much more productive people are in SF than in rural Texas. But what we are actually observing is the effect of housing restrictions, not something inherently highly productive about being in SF. You observe higher wages and worker productivity in SF because of who can still afford to live there, not because there is some magical “agglomeration economy.”
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"Erdmann suggests that a naive economist might think: Look at how much more productive people are in SF than in rural Texas."
6 years ago, ahem: https://www.arnoldkling.com/blog/disaggregating-the-economy-california/#comment-476624
Because 'productivity' when bare can have different kinds of technical meanings and thus is subject to different kinds of interpretation, it is also liable to become a tool of rhetorical manipulation. This happens so frequently with 'productivity' because of its knee-jerk positive valence that it's now reasonable to presume that unless an author adds a modifier to specify which particular kind of productivity is meant, then manipulating the audience is precisely what he is attempting to do.
For example. There is "Real Productivity", the ability to transform quantities of capital and hours of labor into measurable units of goods and services. If I have two identical coffee-making robots in Caracas and Carmel, the fact that a cup of coffee goes for 50x more in Carmel does not, from this perspective, make the machine "more productive" if you move it to a different set of geographic coordinates.
There is "Nominal Productivity" in which everything is measured in dollars without regard to local differences in wages, cost of living, the eviction from the local marketplace of the low-surplus, price-sensitive parts of the demand curve, etc.
You can also imagine "Utility Productivity", but that's tricky. We can usually measure inputs vs outputs in comparable units, and we can measure money flows in dollars, but we can't measure whatever hedonic qualia are experiences by conscious market participants or the metaphysical construct of 'utility', the levels of which we can only infer from particular conceptions of it.
Let's say in alternative reality cheaper-housing San Francisco and Bay Area Billionaire is willing to pay $100 for a cup of coffee but he gets to enjoy a lot of surplus because the going market rate is $5 or whatever. Ok, now the rents go into the stratosphere, all the non-millionaires have to pack their bags, the number of coffees sold declines by 99%, but the remaining barista still makes the same number of coffees per hour she did before, only now the price is $100. Well, we can reasonably assume the Billionaire still gets the same utility from that one coffee, though not from the opportunity cost of the $95 of surplus he now transfers through the coffee shop to local landlords and governments. So, wait, what happened to utility and productivity again? The point is that you can try to simply define the prices that highest bidders pay in a constrained marketplace as 'utility' but it's now how most people understand that term, or what they would agree with in terms of growth maximization goals.
Here are some examples of how that approach yields results that would strike most people as absurd.
Monopoly / Labor Union Scenario. The Labor Union gets an agreement for higher wages by turning the 'competitive' companies in that sector into a cartel that limits production to lower supply and raise the average price per unit output. Each guy does the same amount of real work per day, but gets paid more, and the overall level of production and surplus is down. But we can cheer because this contract has "raised worker productivity" in that sector? Um, sure it has.
YIMBY wins scenario. The Bay Area YIMBYs triumph politically and remove all limits to building in the whole metro. Mini-Tokyo gets built and rents decrease 50%. With a cheaper cost of living, business real estate rent is cheaper, and new baristas can be hired for lower wages, and so the price of coffee goes down. Barista productivity has now plummeted. Tragedy! Right? Why is it not a tragedy if we are supposed to favor more productivity, and here, according to this definition, it went down?
Again, advocates can use any kind of definition of productivity they want so long as they avoid misleading the audience by being forthright about which particular meaning they are employing.
Erdmann's point is similar to one I have often seen made about high French labor productivity: it's not that France is such a productivity powerhouse, it's that their labor regulations price all the lower-productivity workers out of the labor market.