Social Science

Welfare state: Past Present and Future 7-14-18

Source - Economist, July 14, 2018: "Repairing the safety net"     

Social science: two challenges to the future of the mis-named welfare state are increasing dependency ratios and immigration but the latter may be a fix for the former. UBI and NTI are two new ideas that may be adopted.  

Old Age Dependency

Past: William Beveridge is the architect of the British welfare statre. His report, released in December of 1942, outlined the British system of benefits for the elderly, disabled and unemployed plus the national health service and a universal allowance for children. Beveridge intended this to be a complement to the free market system, not a replacement for it. Beveridge wanted to combat the "Five Giants" which he identified as disease, idleness, ignorance, squalor and want. Quote: "we must have bread for all before there can be cake for anyone".  

Present: three types of welfare states. First, the Scandinavian or Social Democratic model featuring high public spending, universal benefits and strong union-led labor protections (hard to hire and fire). A "conservative" model with Germany as the example featuring a strong contributory principle and with benefits based around the family, not the job. Finally, an Anglo-American model where many benefits are tied to behavior and there a fewer universal benefits but more guaranteed minimums. The ongoing tension: when is a benefit a human right and when can it be made conditional on behavior? Do benefits erode the desire to work? Trend in last fifty years: make more benefits conditional on behavior. 

Future: two challenges - first, the aging of the population in OECD states (see chart). Baby-boomers in Britain will receive benefits spread over their lifetimes 20% greater than the amount they paid in taxes. Next, immigration causes voters to become volatile and angry regarding benefits ("welfare chauvinism"). Immigration may be the solution to rising dependency ratios. Data from Britain and Denmark indicates that since 2002, EU immigrants have paid more in taxes than they received in benefits.

New ideas: universal basic income (UBI) seeks to replace the welfare state means-tested bureaucracy wit one simple unconditional payment. It is currently being tested in Scotland and the Netherlands. Next is the Negative Income Tax or NTI, first suggested by Milton Friedman. If your income falls below a certain level, the government pays you the difference. A paper published in 2015 by Luke Shaefer of the University of Michigan shows that an NTI is feasible.  

Genes, background more important than type of school 3-31-18

Source: Selective evidence - Genes and backgrounds matter most to exam results - The type of school is less important     

From this article: "Debate has raged for years over whether most selective schools do well because they provide a better education than state schools, or merely because they cream off the brightest and most privileged. According to research led by Robert Plomin and Emily Smith-Woolley, both of King’s College London, the educational benefits of selective schools largely disappear once the innate ability and socio-economic background of pupils at selective schools are taken into account. On average, the results of children at private or grammar schools were a full GCSE grade higher than those at state schools. That suggests attending a selective school gives children a boost. Without correcting for any other factors the researchers calculated the boost to be worth about 7.1% of the difference in GCSE results. But was this due to better teaching at these schools or an outcome of the selection procedure? To see, the team adjusted the grades based on the results of each child’s test scores, family circumstances and genes. Once they did this, the gap between the schools narrowed dramatically, with school type explaining just 0.5% of the difference in average GCSE grades. For any individual, genetics accounted for about 8% of the difference, modest in comparison with the many other factors involved, such as socio-economic backgrounds..."

Educating Gifted Children 3-24-18

Source: Economist: 24 Mar 18 "Talent Shows"         

IQ and accomplishmentOld idea; intelligence as a child often equated to a troubled adulthood. This is not borne out by recent research which indicates that of the top one-half of one percent scorers on childhood IQ tests, a full 30% go on to achieve doctorates (compared to 1% of the population overall). On the chart, note the higher the SAT score, the more likely the student is to go on to get a PhD, write a paper and file a patent. Work by Chetty at Stanford shows that there is also a socioeconomic component to future intellectual success - children of wealthier parents are more likely to file patents or get PhDs that poorer studentswith the same level of intelligence. Chetty calls these poorer children who fall through the cracks later in life "Lost Einsteins". If women, minorities, and children from low-income families were to invent at the same rate as white men from high-income (top 20%) families, the rate of innovation in America would quadruple. Important to be on the same page regarding "intelligence", best defined as "the ability to think abstractly and use reason to plan and solve problems". Today, there is a shift away from using the label "intelligence" ad instead talk about "high ability". And to extend the description of intelligence to include spatial ability.

Some policy recommendations: first, childhood ability testing must be universal and not voluntary. 2015 paper from Card and Giuliano shows that when a Florida school district shifted to universal screening, admissions to gifted programs increased by 180% amongst poor children (130% increwse for Hispanic kids and 80% for black kids). Next, test for more than just IQ - test also for spatial ability. Finally, Project Bright Idea, developed at Duke University, saw 10,000 typical nursery and primary-school pupils taught using methods often reserved for brainier kids—fostering high expectations, complex problem-solving and cultivating meta-cognition (or “thinking about thinking”). Nearly every one of them went on to do much better on tests than similar peers.

In rebuttal, there are researchers that argue that intelligence is not the best predictor of future success. Angela Duckworth in her book "Grit" (2016) believes that task-motivation or persistence is the best predictor of future success and it can be taught. Anders Ericson of FSU believes in the power of deliberate practice over a long period (the 10,000 Hour Rule). Others like Carol Dweck of Stanford thinks the mindset of the child is important - either a "growth mindset" or a "fixed mindset". While this approach is now popular in education, there is little evidence to back it up.

Source: Chetty on Lost Einsteins

Source: Card and Giuliano on universal screening

Source: Duke's Project Bright Idea