Bryan Caplan's Blog, page 65

May 23, 2018

The Education System: More Dysfunctional Than I Thought, by Bryan Caplan

When Alex Tabarrok effusively praised my interview with Effective Altruist Rob Wiblin of 80,000 Hours, I got a little nervous.  Me:
And again, Washington state from what I understand, now allows kids to use a computer language in place of foreign language.
Why nervous?  Because I've mentioned Washington's foreign language policy in several interviews, but never verified my claim.  When I write, I check any fact I'm less than 95% sure of.  When I speak extemporaneously, however, my standards are admittedly lower.  Yes, adding "from what I understand" acknowledges my lower confidence level.  But what's really going on in the state of Washington?

Answer: the Washington legislation did indeed consider a bill along these lines, known as  HB-1445 2015-2016.  The gist of it, courtesy of Ars Technica:

Two Washington state legislators have recently introduced a bill that
would allow computer science class (e.g., programming) to effectively
count as a foreign language requirement for the purposes of in-state
college admissions. On Wednesday, the bill was presented before the
Washington State House of Representatives Committee on Higher Education.


House Bill 1445 would
amend current state law, which only recognizes "any natural language"
that is "formally studied... including a Native American language,
American Sign Language, Latin, or ancient Greek."

Contrary to what I told Wiblin, however, the bill still seems to be stuck in committee three years after its proposal.  A similar 2015 Kentucky bill failed, too

In sum, I erred.  One of the few bright lights of reform that I thought I saw in the current educational landscape was a mirage. 

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Published on May 23, 2018 12:13

May 22, 2018

What Do Liberal Abusers Really Think?, by Bryan Caplan

#MeToo's most notorious alleged sexual predators, Harvey Weinstein and Eric Schneiderman, were also prominent liberals.  From New York Magazine's pre-scandal profile of Schneiderman:
He has the soul of an activist--he sees himself as a movement
progressive. And halfway through his term as A.G., Schneiderman, 58, has
become New York's definitive liberal, using the national prominence his
predecessors brought to the office to try to yank an increasingly
centrist Democratic Party back toward its progressive roots. He's become
a gatekeeper for the left.
Even if both of these figures miraculously turned out to be innocent, there must be plenty of vocally left-wing perpetrators of sexual violence.  My question: What do liberal abusers really think?  What's actually going on inside their heads?  Consider some possibilities:

1. Global insincerity.  If you enjoy acts of sexual violence, vocal liberalism seems like a useful way to distract attention from your crimes.  In their hearts, people like Weinstein and Schneiderman are apolitical.  They don't care about the issues they claim to care about, and don't loathe the political "enemies" they claim to loathe.

2. Local insincerity.  Another possibility is that liberal abusers are, by and large, sincere left-wing ideologues.  But they covertly doubt liberal views (indeed, mainstream views) on sexual violence.  So while they think it's OK to, say, beat their girlfriends, they earnestly yearn for a $15 minimum wage.

3. Reactionary-in-liberal clothing.  Perhaps liberal abusers are secret but sincere proponents of reactionary patriarchy.  They think women are their born slaves, so they have every right to engage in unrestrained sexual violence.

4. The political is not personal.  Some utilitarians think that utilitarianism is an ethic for governance, not personal behavior.  Perhaps some liberals picture liberalism the same way: Society should adhere to leftist norms, but individual liberals are free to pursue their self-interest as they think best.

5. Self-control problems.  Saint Paul famously said, "For
the good that I would I do not: but the evil which I would not, that I
do."  Perhaps liberal abusers face the same demons.  They deeply love
liberal ideals - including ideals about proper sexual behavior.  But
when they interact with actual women, they're overcome by their own lust
and anger.

6. Self-conscious evil.  Rather than suffering from self-control problems, perhaps liberal abusers just don't feel like doing what they think is right.  While they're perfectly able to control their impulses, and concede that their impulses are immoral, they choose evil anyway because it's more fun for them.

Conservatives probably gravitate to explanation #1, while liberals will more likely favor #5.  To me, mix of #2 and #6 is most psychologically plausible.  It's hard to believe that liberal abusers are globally apolitical; that's taking method acting to an inhuman level.  Still, liberal abusers have an especially strong motive to exaggerate their commitment to feminism.  That said, their behavior probably falls far short of whatever looser norms they do accept.  Furthermore, since abusers are almost always repeat offenders, I don't buy "self-control" excuses.  After all, a multitude of commitment strategies are available to any latter-day Paul who "just can't help himself" - starting with "never spend time alone with non-relatives of the opposite sex."

What your favorite story here - and why?  Please show your work.

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Published on May 22, 2018 07:39

May 17, 2018

The Human Capital Purist Case Against Tax-Funded College, by Bryan Caplan

In the Soho Forum debate on "All government support of higher education
should be abolished" , I heavily based my argument on the signaling model of education.  But if I were a human capital purist, I still would have defended the abolitionist position - albeit less triumphally.  Here's how:

1. Prospective college students, unlike K-12 students, are adults - both legally and practically. 

2. Hence, if they want to invest in themselves, they or their families can and should pay for it.  This would be a lot easier than it is today, because government subsidies have greatly inflated tuition.

3. If prospective college students or their families don't have the money, they can borrow the money on the free market.  This will normally be doable as long as the investment is worthwhile. 

4. As an added bonus, lenders will provide useful feedback about the wisdom of prospective students' educational plans.  If you can't get finance on reasonable terms, you're probably making a mistake with your life.

5. While a free-market for educational loans suffers from numerous credit market imperfections, so does a free market for any business loan.  In the real world (as opposed to a homework problem), government is unwise to second-guess lenders' reluctance to lend large sums to borrowers with no/bad credit and little/no collateral. 

6. It's especially unwise to arbitrarily pick out educational investments for special treatment.  If investment is socially suboptimal, government should adopt across-the-board pro-investment policies (for example, by making investment interest tax-deductible), not play favorites.

7. Educational philanthropy provides a massive safety net for poor talented, motivated youth who can't obtain financing.  In the absence of government funding, we should expect this philanthropy to be even more generous than it already is.

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Published on May 17, 2018 13:47

May 16, 2018

May 15, 2018

Caplan-Glaeser Debate: My Opening Statement, by Bryan Caplan

Yesterday Ed Glaeser and I debated "All government support of higher education
should be abolished" for the Soho Forum.  Many thanks to Gene Epstein for organizing, and Ed for being a great sport, great scholar, and great guy.  Here's my opening statement.  I'm happy, of course, to post anything Ed would like me to run.


Why should higher education
receive government support?  There are
two main arguments.



The first is the economic
argument.  Government support is
allegedly economically beneficial not merely for individual students, but for
society as a whole. 



The second is the
humanistic argument. Economic effects aside, government support is vital for
the promotion of intrinsically
valuable ideas, culture, and values. 



If I merely supported
spending cuts, I'd only need to argue
that both the economic and humanistic arguments are overrated.  Since I advocate full separation of college
and state, however, I've got to go further. 
And I do. 



My book, The Case Against Education, maintains
that both the economic and humanistic arguments are deeply wrong.  Economically speaking, subsidizing higher
education is like subsidizing polluting industries.  It's probably good these industries exist,
but the free market tends to produce too much,
not too little.  The humanistic argument
is similarly flimsy; while I share the humanists' ideals, higher education
simply isn't very persuasive or transformative. 
The vast majority of college students arrive as philistines and leave as
philistines. 



Since Ed and I are both
economists, I'll focus on the economic argument.  The standard story says that college is great
place to "build human capital." 
Professors supposedly spend four years pouring useful job skills into
their students.  Why should we believe
this?  Because college graduates outearn
high school grads by over 70%.  Employers
aren't stupid.  If college didn't build
tons of human capital, why would the labor market shower rewards on college
grads?



This is a convincing
story... until you remember what college professors actually teach.  Sure, there are a few majors that regularly
prepare their students for the world of work, like engineering and computer
science.  But most of what college students study is simply irrelevant in the
labor market.  In real life, how often do
you use history, government, literature, foreign languages, psychology,
philosophy, or higher mathematics?  By
and large, students can safely forget such material after the final exam,
because it never comes up again as long as they live.   And forget it they do. 



These observations are so
obvious you might wonder how anyone can deny them.  Think about your own educational experience:
How many thousands of hours did you spend studying foreseeably useless
material?  Economists' standard response
is simply to double back to the labor market. 
If college coursework were largely irrelevant in real life, real life
employers wouldn't pay college graduates a handsome premium. 



Strangely, though, there's
a Nobel prize-winning economic model that explains why even the most irrelevant
coursework and silliest majors can be financially rewarding.  It's called signaling.  Basic idea:
Academic success is a great way to convince
employers that you've got the Right Stuff - to show off your brains, work
ethic, and sheep-like conformity.  Since
people with these traits are productive workers, employers happily reward
people who display them - even if the display itself has nothing to do with the
job.



Think about it like this:
There are two distinct ways to raise the value of a diamond.  The first is give it to a gemsmith to cut the
diamond to perfection.  The second is to
give it to an appraiser to attest to its flawlessness.  The first story is like human capital.  The second is like signaling. 



What difference does the
mechanism make?  For the individual
student, not much.  For society, however,
it makes all the difference in the world. 
Insofar as the human capital model is right, government support for
college enriches society as a whole by upgrading the skills of the workforce.  Insofar as the signaling model is right, however,
government support for college impoverishes society by sparking a credentialist
arms race.



So which model is right -
human capital or signaling?  The truth is
obviously a mix of both.  In The Case Against Education, however, I
argue that signaling's share of the mix exceeds half - and probably a lot
more. 



Why should you agree with
me?  For starters, look at the
curriculum.  Most of what we teach in
college is so otherworldly that
you're only likely to use it on the job if you become a college professor
yourself.  No sane person with a
non-academic job panics because they've forgotten everything their professors
taught them about history, literature, or philosophy.



Curriculum aside, you
probably already tacitly agree with me. 
Did you bother to enroll in college or pay tuition?  If all you wanted was the learning, this was
a total waste, because you can unofficially take classes at virtually any
college in America for free.  There's
just one little problem.  At the end of
four years of guerrilla education, you won't have the crucial signal: the
diploma.  Hence, unofficial education
barely exists.



Suppose you could have a
Princeton education without the diploma or a Princeton diploma without the
education.  Which would you choose?  If you have to ponder, you already believe in
the power of signaling.  By contrast, if
you were stranded on a island and had to choose between knowledge of
boat-building and a boat-building degree, you wouldn't ponder.  When you face the labor market, it's
important to be impressive.   When you
face the ocean, all that matters is skill.



Signaling dominates if you
look at the way college students approach their studies.  They routinely seek out "easy A's"
- professors who dole out strong signals in exchange for little work.  Of course you don't learn much from such
professors, but who cares?  After the
final exam, you'll never need to know it again. 
Signaling likewise explains why academic cheating isn't just
"cheating yourself."  When you
impersonate a good student, you hurt employers who hire you - and the honest
students whose merits you indirectly call into question.



Academic research
reinforces common-sense.  While
economists typically measure education's annual
return, scholars who look find enormous diploma or "sheepskin effects."  Senior year pays far more than the earlier
three years combined!  This is very hard
for human capital theory to explain.  It
makes perfect sense if college students are trying to signal their conformity
by completing their degree. 



Macroeconomists, similarly,
have found that while individual education has a big effect on individual
income, national education has only a small effect on national income.  To be fair, they rarely embrace the signaling
explanation; instead they cry for better data so "we can get the right
answer."  But signaling cleanly
explains their results: If one laborer gets more irrelevant education, he
outshines the competition; but if a whole labor force gets more irrelevant
education, society's time and money go down the drain.  Given the small effect of education on GDP,
it's hardly surprising that few researchers find that education leads to higher
GDP growth.  If you're still trying to
figure out if your machine moves at all, you can safely conclude it's not a perpetual motion machine.



The most striking academic
evidence for signaling, though, comes from the literature on "credential
inflation."  The average worker is
years more educated than he used to be. 
How much of this is because jobs are more cognitively demanding?  How much of this is because workers need more
education to get - though not to do - a given job?  In The
Case Against Education
, I examine all the main studies.  Punchline: The evolving labor market explains
only about 20% of the rise in education. 
The remaining 80% is credential inflation: You need college to convince
today's employers to give you the same jobs your parents or grandparents got
right out of high school.  This is
puzzling for human capital theory.  Why
should employers pay for B.A.s when you need only a high school education to do
the job?  Signaling explains it
elegantly: The more degrees proliferate, the more you need to stand out.



When I present these
arguments, economists rarely deny that signaling seems like a persuasive
story.  Instead, they usually retreat to
apriori objections: Appearances notwithstanding, signaling can't be right.  The most popular objection: College "passes
the market test."  If it were mostly
signaling, someone would have figured out a cheaper signal long ago. 



But this this crazy.  Higher education receives hundreds of
billions of dollars of taxpayer support every year - a classic sign that it fails the market test.  There are probably plenty of socially cheaper
forms of labor market signaling.  But as
long as the massive subsidies continue, the substitutes will remain on the fringes.  The easiest way to discover good alternatives
is to end government support for higher ed - and see what comes next.



At this point, you could
respond, "Sure, education is mostly signaling.  But the economic rewards are so great that
it's still worth
subsidizing."  But signaling aside,
there's far less to education's economic rewards than meets the eye.



Why?  First, college graduates aren't randomly
selected.  Most were already high
performers back in high school; if they hadn't gone to college, they probably
would have been fairly successful anyway. 
When researchers statistically compare high school graduates to college
graduates with equal pre-college ability, they almost always find the true
effect of college on personal success is smaller than it seems.



Second, standard
comparisons focus on people who finish
college.  But this is cheating, because
the college graduation rate for full-time students is about 50%.  When you weigh college as an investment, this
slashes the expected return.



A debate is admittedly not
a great place to do arithmetic.  But in The Case Against Education, I snap all
these pieces - and many others - together. 
Along the way, I seriously study potentially neglected benefits of college: health, crime, you
name it.  Because confirmation bias is
bad.  Final result: From a social point
of view, investments in college aren't just overrated; they're ruinous.  Subsidizing this rat race is as economically
foolish as handing out big cash prizes to the world's dirtiest polluters.



When the economic case for
tax-subsidized college crumbles, even many economists suddenly discover the
"finer things in life."   What
about the humanistic argument that college inspires love of ideas and culture -
that it refines and elevates us?  My
quick response: Refinement and elevation would be great... if it really
happened.  But the actual data say that
it's mostly wishful thinking.  Only a
miniscule fraction of college grads take a meaningful interest in ideas or
culture after graduation.  People who
attend events like the Soho Forum for fun are really weird.  That's why I love you guys! 



You could agree with every
word I've said so far, but respond, "Instead of abolishing government
support for higher education, government should use the power of the purse to fix higher education."  We can certainly imagine a world where
colleges fill every student's mind with human capital and every student's heart
with Shakespeare.  Why not do that?



Simple: Defunding
dysfunctional systems is almost fool-proof. 
Fixing dysfunctional systems, in contrast, is horribly hard.  As a professor, I assure you that the entire
system bitterly resists even mild reforms. 
Most professors detest the very idea of objectively measuring the value
of anything they do.  They're artists!  You can't deal with these people - and it's
foolish to try.  If someone says,
"Sorry for wasting trillions of tax dollars.  But we did a few good things, and we'll spend
your money wisely from now on," the prudent reaction is to draw a line in
the sand and say, "You're fired." 



But why should we be so
extreme?  Why not just cut half and see
if that does the trick?  Pragmatically
speaking, abolition is far more transparent. 
The scope of partial reforms is always confusing and debatable.  When you separate college and state, it's
clear-cut.



Since this is the Soho
Forum, let me end with my principled argument for full abolition: the presumption of liberty.  I know there's a wide range of libertarian
views.  In fact, there's one libertarian
view per libertarian.  But we should all
be able to agree that the burden of proof rests on the advocates of government
intervention.  If politicians are going
to take our money without our consent, they should at least have solid proof
that the money is very well-spent. 
Government support for colleges does not meet that bar.  Not even close.

Update: Gene Epstein sent me the vote tally.




PRE




POST




CHANGE






YES




50.49%




63.11%




12.62%






NO




25.24%




25.24%




0






UNDECIDED




24.27%




11.65%




-12.62%









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Published on May 15, 2018 13:25

May 14, 2018

Westernization vs. Islamization: My Bet with Jonathan Cast, by Bryan Caplan

My recent "Steelmanning the Iraq War" defends a view I do not hold.  It concludes:
In the darkest days of World War II, Winston Churchill told the British
people, "I have nothing to offer but blood, toil, tears, and sweat."  I
admire these sentiments, but I know that our enemy is not yet at the
gate.  There is a far worse course than doing nothing: Invading Iraq in
anger, then abandoning it in frustration.  But our best option is to
excise Muslim tyranny now when it's weak, instead of waiting for this
political cancer to spread.
On Twitter, Jonathan Cast argued in earnest for the view that I defended as an intellectual exercise.  When I opined, "The most realistic hope is just gradual Westernization via consumer culture and the Internet. No guarantee, but I'll bet on it," Cast objected: "Bet Europe gets Islamicized before the Middle East gets Westernized." 
While neither of us persuaded the other, we managed to hammer out the following bet.


Cast wins if:

1. None of the laws currently on this webpage are
repealed (unless they are replaced with a substantively identical or
stricter law) before January 1, 2030.



2. At least one of the following countries
officially BANS conversion from Islam: UK, Germany, the Netherlands, or Sweden
before January 1, 2030.

Otherwise, I win.

The stakes: Cast has pre-paid me $100.  If he wins, I pay him $200 plus twelve years worth of interest at 3%, which comes to $274.



In case of ambiguity (particularly on the "substantively identical or stricter" provision), we've agreed to a reputable arbiter.

Commentary: I'm very confident I'll win on #2.  At this point, I'd give conversion bans less than a 20% probability.  On #1, I assign a 60% probability that Cast is right.  But that's primarily because I think that Westernization will be mostly de facto rather than de jure.  After all, Virginia didn't legalize cohabitation until 2013!

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Published on May 14, 2018 11:51

May 9, 2018

Irrational and Negligent, by Bryan Caplan

What's wrong with your intellectual opponents?  One of the most popular answers is that they're "stupid and evil."  Most of the thinkers I respect go out of their way to disavow this facile answer.  Indeed, most of the thinkers I respect go out of their way to praise their opponents' intelligence and virtue.  They don't merely opine, "We can disagree without being disagreeable."  They put those who disagree with them on a pedestal.

My respect notwithstanding, this seems odd.  If your opponents are so great, why are they still your opponents?  If you're right, why haven't your arguments caused them to change their minds?  If they're right, why haven't their arguments caused you to change yours?  On reflection, Robin Hanson is right to insist that "disagreement is disrespect."  After all, if you really held another thinker in the highest esteem, you would trust their judgment over your own.

What then do I think is wrong with my intellectual opponents?  With rare exceptions, I deny that they're stupid.  Indeed, I think that many of my intellectual opponents are clearly smarter than me.  Paul Krugman and George Borjas swiftly come to mind.  Nor do I think they're evil.  A few trolls aside, my opponents are doing what they believe to be right.  So where do they do wrong? 

First, while they're not stupid, they're usually irrational.  They let their emotions sway their judgments.  They indulge in hyperbole.  They take the values of their society for granted.  They don't bet

Second, while they're not evil, they are negligent .  It doesn't take a genius to figure out that thinkers should stay calm, measure their words, question their society's values, and put their money where their mouths are.  But my intellectual opponents still routinely fail to abide by these norms.  The beliefs for which they're known are largely wrong because poor intellectual self-discipline normally lead to error.

Now you could ask, "Doesn't the same critique apply to your intellectual allies, too?"  The answer, sadly, is yes.  Most of my allies are irrational and negligent, too.  If they're right about controversial issues, they're usually right for the wrong reasons.*  How can they be right when their intellectual methods are so poor?  Simple: They got lucky.  That's why they're so rare.

The toughest challenge, though, is: "Doesn't the same critique apply to Bryan himself?"  My response: I ruminate on my own irrationality every day.  When I write, I weigh each sentence for accuracy.  I live the Betting Norm.  Taken together, this seems sufficient to clear me from the charge of negligence.  Full rationality, in contrast, is such a high bar I don't think I perfectly meet it.  The best I can say for myself is that when I fall short of full rationality, it's rarely for lack of trying. 

Still, there's always room for improvement.

* I do think that my closest intellectual allies - people who
broadly share my arguments as well as my conclusions - are markedly
better.  But that's a tiny crowd.

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Published on May 09, 2018 12:32

May 8, 2018

Why Isn't the Military a Stronger Signal?, by Bryan Caplan

Interesting question from EconLog reader Jonas Graham, reprinted with his permission.
________________________________________________________________________

Dear Mr. Caplan,



I read your book "The Case Against Education," well, as much as I
could read for free off Amazon and Google Books, anyway. :P  I might buy
it, eventually...



You say that college is the best way to signal to an employer that you are
intelligent, conscientious and conform to social norms.  Other ways such
as maintaining a Science Fiction blog, copying the dictionary or eating Kosher,
despite being a goy, would just come off as "weird".



However, there is one way to signal that you are conscientious and conform to
social norms, in fact *WAAAAY* more than college: enlisting in the
military.  The military is very respected and very much not
"weird", especially in the US.  Even in the bluest of "blue
states", you will see USO lounges at airports, military discounts,
etc.  Soldiers work hard, are very disciplined (for example, they have to
make their bed every morning, even though it's stupid and there's really no
point!) and do they ever conform to social norms!



Alas, it doesn't really signal intelligence, but, of the three, that's the
easiest to measure: you could just have them do an IQ test.  The military,
itself, administers an IQ test, of sorts, called the ASVAB.  Although it
would be "weird" to put one's ASVAB score on one's resum��, certain
military jobs are reserved for people with high
ASVAB scores
, for example: Military "Intelligence" and Psy
Ops.  Wouldn't somebody with military experience in one of those fields
also signal intelligence?



Have you ever come across any data comparing career success of college
graduates vs. military vets?  I have found the following anecdotal
account
about how many employers still prefer a Bachelor's degree to
military experience and the author talks about how military experience should
signal the same things as a Bachelor's degree, but employers don't seem to
"pick up" on these signals.



I have seen your interview on the Rubin Report, by the way, and I know you are
a "pacifist" but, considering how big the US military is and how many
vets there are, I wonder if you ever looked into this or just what's your take?



Perhaps you talk about this in the parts of the book I missed? :P



Anyway, huge fan!  Thanks for the enlightening read!



Sincerely,





Jonas Graham




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Published on May 08, 2018 13:12

May 7, 2018

Income, Sex, and Moral Equivalence, by Bryan Caplan

My dear friend Robin Hanson was recently harshly criticized for highlighting the symmetry between income and sex inequality.  Robin:
One might plausibly argue that those with much less access to sex suffer
to a similar degree as those with low income, and might similarly hope
to gain from organizing around this identity, to lobby for
redistribution along this axis and to at least implicitly threaten
violence if their demands are not met.
One of the better responses is that extreme poverty causes death, while extreme celibacy merely causes unhappiness.  Robin's reply:
Many people are also under the impression that we redistribute income
mainly because recipients would die without such redistribution. In rich
nations this can account for only a tiny fraction of redistribution.
Robin's right, of course, but let me translate and elaborate on his reply.  When Robin says, "In rich
nations this can account for only a tiny fraction of redistribution," he basically means that only a tiny fraction of existing income redistribution is necessary to prevent very poor fellow citizens from dying.  How tiny a fraction?  Well, if redistribution has zero effects on work effort and other poverty-relevant choices, then just add up the cost of raising everyone below subsistence income to subsistence, then divide that sum by total existing redistribution.  And since redistribution has at least some perverse incentive effects (e.g., Social Security leads to lower retirement saving), the necessary fraction is even less than it appears.

If you object, "We shouldn't just meet people's bare survival needs.  They should have enough to live in dignity," you have officially entered Robin's zone of moral equivalence.  No one dies of lack of dignity, after all.  So what is the moral difference between a lifetime diet of beans and rice versus a lifetime of involuntary celibacy?

Unlike Robin, I should add, I'm a big believer in moral blameworthiness.  Whether we're discussing poverty or involuntary celibacy, I think we should always start by investigating whether the sufferer is culpable for his own woes.  And empirically, I think the sufferer usually is highly culpable.  Able-bodied adults in the First World can and should work their way out of poverty, even if the best job they can get is not fun.  And much the same holds for celibacy: Most incels can and should adjust their behavior and attitude to find love, even if the best partner they can get is not thrilling.

At the same time, though, I freely admit that a sizable minority of people suffer blamelessly.  A severe congenital handicap could easily lead to both severe poverty and isolation despite exemplary behavior.  Should government do anything about this?  I don't know, but at minimum we shouldn't add insult to injury by mocking people who fail despite earnest effort.  But is there anyone morally benighted enough to so mock them?  Sure; just scroll through the aforementioned replies to Robin - or see the indiscriminate contempt many people express for incels.

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Published on May 07, 2018 11:40

May 3, 2018

A Simple Black Swan Proof, by Bryan Caplan

Antifragile.jpg My recent conversation with Nassim Taleb was quite fun.  (Full audio coming soon).  Reading through Antifragile , though, I often felt like he was overcomplicating things.  Taleb is rightly annoyed when people estimate "the worst thing that can happen" using "the worse thing that has happened."  But you don't need non-normality or convexity or fat tails to expose this fallacy.  Indeed, you don't need any distributional assumptions.  Why not just say this?

1. Either the worse thing ever has already happened or it hasn't.

2. If the worst thing ever has already happened, then the badness of the worst thing ever equals the badness of the worst thing that has already happened.

3. If the worst thing ever hasn't already happened, then the badness of the worst thing ever exceeds the badness of the worst thing that has already happened.

4. If we know with certainty that the worst thing ever has already happened, the expected badness of the worst thing ever equals the badness of the worst thing that has already happened.

5. If we don't know with certainty that the worst thing ever has already happened, the expected badness of the worst thing ever exceeds the badness of the worst thing that has already happened.

6. We don't know with certainty that the worst thing ever has already happened, so the expected badness of the worst thing ever exceeds the badness of the worst thing that has already happened.

Taleb is wise to warn us against using the worst thing that's ever happened to estimate the worst thing that can happen.  But his point is a lot more general than he seems to think.  As long as you have enough common-sense to admit that the worst thing ever might not have happened yet, his warning holds.

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Published on May 03, 2018 07:47

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