As you head off to college, here is some practical advice from a college professor who is also a student advisor...Pretty good stuff to make you think...

For those of you on your way to college and trying to figure out what classes to take, or wanting to maximize your time/experience at college this Yale professor has some practical advice that I think is important to consider. Some in education are not going to agree with a lot of it, but the advice is not for them, but for you.
He also has other links for other perspectives HERE and HERE

From Chris Blattman...

1.Acquire skills that are hard to get outside school. Your first temptation will be to fill your schedule with courses on fascinating subjects. Do this, but don’t forget to also use university to tech up. For anyone interested in public policy or development, I suggest at two semesters of statistics and economics. Then pick a field of study in development (economics, politics, etc) and pick the hardest courses in each. Other technical skills may come in handy, depending on your interests: international law, political theory, tropical medicine, qualitative methods, finance & accounting, and so forth.


2.Learn how to write well. Take writing seriously. Consider a course in creative, non-fiction, journalism, or business writing. Read books on writing. You won’t regret it.

3.Focus on the teacher, not the topic. You will learn more from great teachers than great syllabi.

4.When in doubt, choose the path that keeps the most doors open. If you aren’t sure of your interests, stick to mainstream majors, ones with plenty of job and grad school options at the end, and get your core stats and math training (multivariate calculus, linear algebra, and multivariate regression).

5.Do the minimum language and management classes. Languages are hugely valuable, but better learned in immersion, during your summers and holidays. Maybe take an intro course, but only that. Business and management skills are critical, but classrooms are poor places to get skills other than finance and accounting.

6.Try careers on for size. Don’t wait until you finish law or medical school to discover you hate working in your specialty. Try out different careers in the summer–researcher, journalist, medical assistant, NGO worker, congressional aide, and so on.

7.Go to strange places. Use a summer or a school year to live abroad, ideally a place completely different from home, where you’ll come to know local people (and not just the expat community). A 10-week sojourn across Western Europe is a blast, but see if you can bunker down for longer in a less familiar locale. Here’s when it makes sense to learn languages.

8.Take some small classes with professors who can write recommendations. If you’re uninterested in grad school, skip to #9. But if a MA or PhD is an option, you will need at least three high quality recommendations. (See my recommendation letter advice here.)

9.If you don’t have to write a thesis, think twice. An independent research project can be the perfect capstone to your college years. Sadly, I often see theses that weren’t worth the students’ investment of time and energy. Some people’s time would be better spent acquiring technical skills (see point 1). I used to advise students against a senior thesis if they had the choice. After getting lots of disagreement on my blog, I’ve revised that view; a senior thesis can be a great investment if you are dedicated to a question of interest, want to learn how to research, want to strengthen a relationship with a professor, want practice for graduate school, or want to try out research and writing as a career option. (If you do plan to write a senior essay, here are my advising requirements.)

10.Blow your mind. At year’s end you should look back at your thoughts and opinions twelve months before and find them quaint. If not, you probably didn’t read or explore or work hard enough. (Come to think of it, this is not a bad rule for life.)

The logic underlying all the above advice: use your undergraduate degree to learn things that are hard to learn anywhere else. Statistics are not more important than languages. But the opportunity cost of skipping a statistics course is high because it’s hard to find alternatives to university classes. Remember you only get 32 courses at university. The opportunity cost of a language program is low because there are a dozen other times and places you can get that skill.

Your paycheck is killing you.. No, really your paycheck IS killing you!...See how here...

When social scientists do research, they try to avoid the "correlation vs. causation" trap. In this particular study (Source: Freakonomics), the basic conclusion is that it is not the actual paycheck that kills you, but the additional activities you engage in after getting paid that increase the risk of something bad happening to you.  My own example: You have little gas a few days before your paycheck--- you drive less. Get paid, and you will drive more in the day(s) after receiving your check, so the probabilities of something bad happening increase.

Why You’re More Likely to Die After Getting Paid

""In a study to be published in an upcoming issue of the Journal of Public Economics, Evans and Moore examined the death records of four demographic groups in the U.S.: seniors on Social Security; military personnel; families receiving tax rebate checks in 2001; and recipients of Alaska’s Permanent Fund dividends. Their results show that mortality increased the week after checks arrived for each of these groups.


Though the effects are strikingly consistent across populations, there are some interesting variations:

•In counties with a large military presence, daily mortality among 17-29 year olds increases by around 10 percent the week after mid-month paychecks arrive.

•The week the 2001 tax rebate checks arrived, mortality among 25-64 year olds increased by 2.5 percent.

•During the week that direct deposits of Permanent Fund dividends are made, mortality among urban Alaskans increases by 13 percent.""

What do they believe is the reason for this outcome?

Q: What about cause of death?


A: For the 17 to 29 population, you see lots of substance abuse and blunt force trauma from auto accidents.

Q: So is it fair to say that when people get paid, they go out and engage in risky behavior? They go party and buy drugs and drive drunk? Is that what’s happening here?

A: There is some of that, but it’s not that extreme for the most part. For a lot of people, you’re just going to the mall to buy something, which increases the risk of all kinds of things: car accidents, heart attacks. It’s not that you’re doing crazy, irresponsible things. It’s not the receipt of income that’s necessarily driving this, it’s the activity generated by the receipt, that’s the killer activity. And that cuts across the entire population.

Q: Did that surprise you, that it was consistent across different types of people?

A: Very much, I think that’s the most important phenomenon with this study, just how broad-based the effect is. The within-month mortality cycle holds for everyone, young and old, rich and poor. It is enhanced for certain demographics. But it’s also very persistent across populations. So, it’s not just poor people or young people, it’s everyone.

It has begun---the new geo-political war for vital natural resources and Russia makes the first move. Move over Polar Bears, the Russian Bear is coming for you!

Russia to deploy 2 army brigades in Arctic

""Russia's defense minister says the military will deploy two army brigades to help protect the nation's interests in the Arctic.

Anatoly Serdyukov says his ministry is working out specifics, such as troops numbers, weapons and bases, but a brigade includes a few thousand soldiers.

Serdyukov was quoted by Russian news agencies as saying Friday the brigades could be based in Murmansk, Arkhangelsk or other areas.

Russia, the U.S., Canada, Denmark and Norway have been trying to assert jurisdiction over parts of the Arctic, believed to hold up to a quarter of the Earth's undiscovered oil and gas.

On Thursday, Prime Minister Vladimir Putin said Russia "remains open for dialogue" with its polar neighbors, but will "strongly and persistently" defend its interests in the region.""

Here is an excellent (and short) explanation of area and the reason for the conflict. This WILL be an area of conflict in the very near future!

Humorous Tech Company Organizational Charts---My favorite is Microsoft...

Source: Business Insider

Oil is like sugar---More of it gives you a short term good feeling but eventually you go back to feeling Blah---Yes, there is a lesson here...

Before last weeks announcement that the US would release some of the oil from the Strategic Petroleum Reserve, the price of oil was already heading down. See graph below. After a week, the price is almost back up to where it was. Can this be considered a policy success?  The administration could make the case that the price would be even higher if the they had not taken the action. It is hard to say at this point.  Perhaps a good lesson in policy lag---the time difference between policy decision and implementation.  Wonder if gas prices are headed up again...  



Source: WSJ

proaji0fodhi



Number of the Week: U.S. Teachers’ Hours Among World’s Longest.

Source: Wall Street Journal

From WSJ: 1,097: Average number of hours U.S. teachers spend per year on instruction.

Students across the U.S. are enjoying or getting ready for summer vacation, but teachers may be looking forward to the break even more. American teachers are the most productive among major developed countries, according to Organization for Economic Cooperation and Development data from 2008 — the most recent available.

Among 27 member nations tracked by the OECD, U.S. primary-school educators spent 1,097 hours a year teaching despite only spending 36 weeks a year in the classroom — among the lowest among the countries tracked. That was more than 100 hours more than New Zealand, in second place at 985 hours, despite students in that country going to school for 39 weeks. The OECD average is 786 hours.

And that’s just the time teachers spend on instruction. Including hours teachers spend on work at home and outside the classroom, American primary-school educators spend 1,913 working in a year. According to data from the comparable year in a Labor Department survey, an average full-time employee works 1,932 hours a year spread out over 48 weeks (excluding two weeks vacation and federal holidays).

Since 1985 there are 50% fewer banks in the US making 350% more in loans*...Nothing can go wrong there, right?

The first graph below shows the change in the number of commerical  banks in the US since the mid-1980's.  I was quite surprised by the rapid decline in a relatively short period of time. Roughly a 50% drop. The slope is pretty steep considering it only represents 25 years.  Another interesting thing is that it appears recessions did not hasten the decline, which you might expect as some banks would fail--the decline just slides through the recessions like they never happened (post-2009 migth be the exception).  


Source: The New Arthurian Economics

 This next graph shows the growth in loans in Commericial/Industrial Loans (Business Loans for expansion, Capital Purchases, Accounts Receivables, etc), Real Estate (residential and commercial properties)  Loans and Loans to Consumers (Cars, Credit Cards, Student Loans, etc). Prior to 1985 banks were balanced in there portfolios of loans to these three sectors.  After 1985, there was a dramatic shift towards Real Estate loans.  Starting in the mid to late 1990's the Real Estate loan line (Red) becomes VERY steep and banks portfolios become very unbalanced (numerically and perhaps psychologically, too-- :) ).  


Source: The New Arthurian Economics

  What happened during the period between 1985 and the late 1990's that set in motion (1) the  decline in the number of banks and (2) the rapid increase in the number/value of loans made? Hmm...fewer banks making more loans...nothing bad can happen there, right?? Yes, Art, you can play along too and correct me as needed :)

*rough, ballpark calculation just by eyeballing--- 1985 about $1.7T and in 2011 about $6T..$6T/$1.7T = 3.529 x 100 = 353%

Bastiat's "The Seen and the Unseen" and "The Broken Window Fallacy" explained in a short video. Does it get any better than that?

Please go HERE for the text that accompanies this video. Only read the first part on "The Seen and the Unseen" and "The Broken Window Fallacy".

This is the first assignment I give in AP Economics (Both Macro and Micro). I like to thread the "seen" and "unseen" theme throughout the semeter. I think it underscores the concept of opportunity cost and helps students become better critical thinkers. I also find it is one concept students NEVER seem to forget!

HT: Kids Prefer Cheese

Nice Interactive---Compare the US to any other country in key demographic and "quality of life" measures..

If you go to this site, you can choose any country and compare them to the US (or you can use another country) in terms of a small sample of demographic and "quality of life" metrics.  Seems whenever I come across these type of things, the US always looks like one of the worst places on earth to live. Are these measures the "trees" but people are missing the "forest" that is the US? Still, it is interesting to see what are potential weaknesses are...One can always improve! :)

Source: If It Were My Home...

A nice set of Online Maps from National Geographic...A reminder of how fortunate we are just by virtue of where we are located on the planet...

A nice set of maps with lots of demographic and other information...Reminds me to appreciate my physical location on this planet a lot more. A minority of the population gets to enjoy the majority of the "good life". Go to National Geographic to seem the original maps and more information.

"It was the best of times, it was the worst of times"---Which one is it? Nice chart that shows we live in a golden age, although we probably don't realize it...

""I think I work hard. Lots of Americans think they work hard. But when you compare the economic situation of modern America with the rest of the world, or with long-ago history, then (in a phrase commonly attributed to the old football coach Barry Switzer) we're all born standing on third base, congratulating ourselves for hitting a triple."" (HT: The Conversable Economist)

The Industrial Revolution changed everything, it appears.  The dark blue bar is of interest to me. The light blue bar is a complement to the dark blue bar--they go hand in hand, in my opinion.  The entire output (production of goods and services) of the 1st through the 19th centuries does not even come close to the output of the 20th century by itself.  Even more stunning, is the output in a just 10 year old 21st century is already approx 42% of what was produced in the last century.  AND (HT: Carpe Diem) 23% of all production since 1 AD was produced in the period 2001-2010! Free (or freer) people  working within the framework of strong institutions (i.e. Rule of Law) that protect private property rights and individual liberty produce such results. You might say China is an exception.  In the short run, perhaps, but to sustain their economic gains they will (1) have to produce for people the characteristics I mentioned above, or (2) the people will demand them for themselves. 


Source: The Economist

Food for Thought on the Pay to Ride bus situation in KISD

Hello, My name is Gene Hayward. Full Disclosure: I teach Advanced Placement Economics at Central HS AND I do not live in the district, so take what I say with as many grains of salt as you like :) ...I would like to inject a thought into the Pay to Ride System, which in principle I support, but I do have a major concern that I do not think has been thought through. This should not be an area for conflict because it WILL have to be addressed in some fashion by everyone here…Here goes…According to the latest Texas Education Agency AEIS reporting system at http://ritter.tea.state.tx.us/cgi/sas/broker , in 2009-2010 school year KISD had 5,830 students classified at “Economically Disadvantaged”. Most of you probably did not know it was that high!! I was surprised myself. The Federal Govt. has used their criteria to determine this and school MUST allow students with this designation all the benefits of this designation. The district, to my knowledge, cannot means test any further to determine benefits (someone correct me it I am wrong). PLEASE keep that last point in mind, regardless of how you may personally feel about it. Those of us in the schools know that even though there may be a stigma attached to this label parents DO take advantage of the benefits accorded them. The pay for ride system will be no different. Let’s assume that only half take advantage of any help to pay for busing. This means 2,915 students will need roughly $300 per year (amount not set in stone yet—you are welcome to insert your own figure) for the bus. 2,915 X $300 = $874,500!! Can the community raise that amount? Can Durham subsidize that amount? Some combination thereof? Now, you can play with the 2,915 number—is it lower? Higher? I don’t know. BUT if we are approaching this as a business decision, would it not be appropriate to have some idea of the potential money needed and a plan to pay for this? I honestly don’t see where this amount is going to come from.

Now, I will point out a potential flaw in my own scenario---I will counter myself by assuming bus service is not a “right” as defined by education law, State or Federal. Someone can correct me on that. If it is not, then an administrative process has to be set up to means test potentially a couple of thousand of applications for financial assistance. Who is going to do this and how much would THAT cost?

What do y’all think? I respectively submit this for constructive criticism…Thank you!

That did not take long...The Tom Tom navigator has been effectively "Creatively Destroyed"..

The Tom Tom came to market in 2002 and the writing is on the wall (or LCD/LED screen) for its demise.  The "Smart Phone" is rapidly consolidating the sheer number of separate devices we currently use into one hand-held device.  I marvel at the changes I have seen in my lifetime (51 years), more specifically in the last 20 years. 

Smart Phones Sting Tom Tom

""Dutch navigation-system maker TomTom NV cut its sales forecast for the second time in two months, an indication that smartphones are eating into the market for standalone navigation devices more quickly than expected.

TomTom pointed to the crumbling North American market for personal-navigation devices, which it now expects will shrink by 30% this year.

Smartphone use, meanwhile, keeps growing. Some 72.5 million people in the U.S. owned smartphones as of the first three months of 2011, up 15% from the fourth quarter, according to market tracker comScore.

Increasingly powerful phones are disrupting the markets for a number of portable devices. Makers of videogame players, digital cameras and hand-held video recorders all are feeling some pressure. Hand-held GPS devices have become a particularly hard sell.""

"I want to ride my bicycle, because it creates jobs. I want to ride my bicycle because it is effective fiscal stimuluuuuss"-Yes, sung to the Queen song.

According to this research paper, infrastructure spending to support bicycle transportation trumps infrastructure spending on road projects in terms of jobs created per million dollars spent (11.4 jobs vs 7.8 jobs, respectively)...Do I have to wear the funny helmet?

HT: Andrew Sullivan

From the research abstract at PERI:

""Pedestrian and bicycling infrastructure such as sidewalks, bike lanes, and trails, can all be used for transportation, recreation, and fitness. These types of infrastructure have been shown to create many benefits for their users as well as the rest of the community. Some of these benefits are economic, such as increased revenues and jobs for local businesses, and some are non-economic benefits such as reduced congestion, better air quality, safer travel routes, and improved health outcomes. While other studies have examined the economic and non-economic impacts of the use of walking and cycling infrastructure, few have analyzed the employment that results from the design and construction of these projects. In this study we estimate the employment impacts of building and refurbishing transportation infrastructure for cyclists and pedestrians. We analyze various transportation projects and use state-specific data to estimate the number of jobs created within each state where the project is located.


The data for this study were gathered from departments of transportation and public works departments from 11 cities in the United States. Using detailed cost estimates on a variety of projects, we use an input-output model to study the direct, indirect, and induced employment that is created through the design, construction, and materials procurement of bicycle, pedestrian, and road infrastructure. We evaluate 58 separate projects and present the results by project, by city, and by category. Overall we find that bicycling infrastructure creates the most jobs for a given level of spending: For each $1 million, the cycling projects in this study create a total of 11.4 jobs within the state where the project is located. Pedestrian-only projects create an average of about 10 jobs per $1 million and multi-use trails create nearly as many, at 9.6 jobs per $1 million. Infrastructure that combines road construction with pedestrian and bicycle facilities creates slightly fewer jobs for the same amount of spending, and road-only projects create the least, with a total of 7.8 jobs per $1 million. On average, the 58 projects we studied create about 9 jobs per $1 million within their own states. If we add the spill-over employment that is created in other states through the supply chain, the employment impact rises by an average of 3 additional jobs per $1 million.""

Are you proud of your "Made in America" car/truck? Would that be ""Built Ford Tough" or "I Love What You Do For Me, Toyota"? Interesting comparison here...

Globalization in a nutshell...Your "Made in America" car or truck may very likely be made by a foreign company. In the graphic below, I put side by side cars.com analysis of the cars/trucks that are for sale in the US from 2006 and 2010.  They rank vehicles by where they are assembled and if they contain over 75% made in America sourced parts. There has been quite a re-shuffling of the deck in just 3 years.

I don't completely know the reason for this,  I will offer a semi-educated guess as to what maybe happening.  Japanese companies in the US are generally (if not at all) unionized, hence pay lower wages than US automakers. This means they can "affordably" buy US made parts--Jobs for assemblers AND for the workers in the industries making the parts. US automakers on the other hand, pay higher assembly wages, hence must cut costs by purchasing less expensive parts from foreign sources--- Jobs for assemblers in the US but not so much for workers in the industries making the parts. The net effect: On a per car basis which company is supporting more American jobs?

(HT: Carpe Diem--what would I do without this resource!)

From Cars.com---""What Are the Top American-Made Cars?

""Cars.com's American-Made Index rates vehicles built and bought in the U.S. Factors include sales, where the car's parts come from and whether the car is assembled in the U.S. We disqualify models with a domestic parts content rating below 75 percent, models built exclusively outside the U.S. or models soon to be discontinued without a U.S.-built successor. ""



Source: Cars.com



""Detroit's full-size pickups, once a dominant force on the AMI, remain off the chart. The F-150 held a commanding No. 1 spot in the first three years that Cars.com compiled the index, with domestic parts content as high as 90 percent. Alas, today's Michigan- and Missouri-built F-150 bears only 60 percent domestic content rating. Similarly, the Chevrolet Silverado, which held second place for much of the F-150's reign, has just 61 percent domestic content. Chrysler's Ram 1500 pickup's 70 percent domestic content fares better, but it still falls short of the AMI's 75-percent cutoff.""

I have wasted money on some good or service, but I have never wasted money on money...Confused? Read this and you won't be confused but will be angry...

Wasting money on money. Who gets to say that? Well, some politicians and a bureaucratic structure that probably knew this was a bad idea but did not act, gets that distinction. I guess it is a stupid question to ask if anyone lost a job/election over this. Nice example of unintended consequences that really could have been avoided by resisting someone's pet project or idea.  Gee Whiz--please be better stewards of the peoples money...

Got this from Greg Mankiw:

""On today's Planet Money, we visit an underground vault that's full of money nobody wants.


The money — bags and bags of dollar coins — is the result of a 2005 law that requires the U.S. Mint to print a series of coins bearing the likeness of each U.S. president.

The problem is, people don't really like dollar coins. And there aren't enough people who are fired up about, say, Rutherford B. Hayes, to make much of a difference.

So more than 1 billion dollar coins are now sitting, unwanted, in Federal Reserve vaults around the country. By the time the program wraps up in 2016, the Fed will be sitting on 2 billion unwanted coins, according to the Fed's own estimates.

The total cost to manufacture those unwanted coins: $600 million.""