The Liberal Order

Congratulations graduates . . . now watch this!

A graduation speech every bit as good as the one given by Steve Jobs at Stanford University in 2005. 

 

Thanks Greg for alerting me to this.

Diversifying your teen's relationship portfolio.

Sometimes it lasts in love,

And sometimes it hurts instead.

What Adele is referring to in this refrain from her song, Someone Like You, is that she failed to diversify her relationship portfolio. She went "all in" in her romance and rather than her investment paying off (i.e., it lasted in love), it turned out to be a bad investment and it hurt instead.

Much like a stock portfolio where you hold a large number of stocks of companies in different sectors, you should also diversify your relationship portfolio and maintain solid friendships with other people. If one of them leaves, or you find that a relationship with one of the friends is not working out, there are plenty of other friends with whom to associate. Once you are fairly certain that that special one is really "that special one," then maybe it's time to take a big risk and go all in on that person, committing yourself only to him or her. (Hey, you wouldn't argue that going all in on Wal-Mart and buying only Wal-Mart stock is a good investment, would you?)

Now, Adele was in her twenties when she was engaged and maybe to her she felt that he was "that special one." Maybe she felt that it's time to get married and that the marginal cost of searching for someone better exceeded the marginal benefit to her were she to find someone better. Consequently, she took the risk and went all in.

This is not the case with adolescents, and a recent study demonstrates why teens should diversify their relationship portfolio and not go all in and date.

Adolescence is when children first begin to push boundaries on the way to adulthood. While they may think they know what’s best for them, they sometimes lack the foresight to see the consequences of their actions. 

Study participants who didn’t date had better overall academic performance, while those who dated earlier in middle school were twice as likely to begin using alcohol and drugs in high school, the researchers said.

All right, so maybe that's a lot of correlation rather than causation. Children who tend to date in middle school exhibit impulsive behavior in all areas of their lives, including drinking, drugging, dating and school. 

“A likely explanation for the worse educational performance of early daters is that these adolescents start dating early as part of an overall pattern of high-risk behaviors,” Orpinas said in a press release.

Other amplifying factors include the emotional difficulties teens often face in middle and high school: bullying, depression, and anxiety. All of these have been linked to higher rates of smoking, drinking, and drug use.

In other words, if you've hired an advisor to manage your portfolio, ask him or her when she first began dating. If they say middle school, take your money and run before they lose it all in risky investments. 

So the dating isn't the cause of the social problems, but is likely a response to other troubling factors in the adolescent's life. If you see your middle or high school-aged child dating, maybe they're looking for something currently lacking at home. Family is the best relationship asset to hold while growing up, but if kids find family an unsafe investment that's not paying off, they'll go looking for other, more lucrative ways of realizing an emotional return.  

I think it's all this investment jargon that sustains the romance in my relationship.

We might soon be saying goodbye to catching a fly ball at a baseball game.

At least if Bud wins his case.

Bud Rountree was at a Boise Hawks game in 2008 when a foul ball smacked him in the face. He had left his seat and was talking to someone, according to reports, when he heard the crowd cheer, turned back toward the field and got plunked. The resulting injury eventually cost him his eye.

Rountree then sued the Hawks, a Single-A affiliate of the Chicago Cubs. Five years later, after various appeals, it turns out his case will go to a jury. Twelve people — not "The Baseball Rule"— will decide whether the team was negligent in Rountree's injury.

Ultimately, the Idaho Supreme Court wrote in its ruling, "[E]ven though the court may have the power to adopt a rule, such as the Baseball Rule ... we find no compelling public policy requiring us to do so." 

All right, so there are certain things that are such a big part of the game that by participating you assume liability for harm caused to you by someone else who is acting as part of the game. By purchasing a ticket to a baseball game—in which part of the enjoyment is catching a foul or homerun ball if you are lucky enough to have one come your way—you assume the liability of being hit by a ball or bat. You have to be vigilant and watch for those things because you know they happen. The same is true of driving near a golf course or driving range, or living on a golf course. It's true for baseball players who get spiked by a player sliding into second attempting to take the defensive player out. And it's true for most things in life. We cannot eradicate all potential harms without significantly changing how we enjoy something, so while participating you have to take the necessary precautions to protect yourself.

This does not mean that the offender has free reign to act negligently, but that if they are acting within the normal expected behavior of the game, you assume the liability for harms you experience as a participant or a spectator of that game. If you don't want the liability, don't participate or watch.  

How will baseball react if Bud is successful in his suit? By substantially changing the experience of the game. This may be necessary—it may be long overdue—but the game will change substantially. 

Imagine what would happen if "The Baseball Rule" fell out of favor. Would stadiums and team owners move fans away from the action? Or play games in a glass bubble, separating players from fans? Would fans start suing for other, less serious injuries? Or even the mental anguish of a line drive whizzing past their face? Yes, these are purposely extreme scenarios, but make no mistake, the fear of litigation could be a paralyzing precedent.

A more realistic scenario is separating the stands from the field with netting that prevents flyballs from leaving the field of play. For many, that's part of the enjoyment of going to the game.

Proving Governor Pat McCrory Right.

North Carolina Governor Pat McCrory voiced concern publicly about the classes taught in today's colleges and universities, arguing that the state should not pay for students who take courses that provide no social value. Basically he was criticizing public colleges and universities that teach, among other things, gender or race specific courses.

From Sunday's Raleigh News & Observer comes this letter to the editor from Joseph Harris:

Perhaps Gov. Pat McCrory is concerned that if UNC women take classes in gender studies they might start asking why they are paid less, on average, for their work than men?

And that proves McCrory's point. It certainly may be that by "tak[ing] classes in gender studies [women] might start asking why they are paid less, on average, for their work than men," but if they instead take a good course in economics they'll do more than ask why; instead, through reason and logic they'll learn why. 

Are things getting better even for the median U.S. household?

Don Boudreaux posts an email I wrote to him in regards to his Wall Street Journal op-ed about the myth of stagnating median household income.

Let me add a few more things from which we benefit greatly.

DVDs delivered to my doorstep. Streaming Netflix and Amazon Prime. Hulu. Mail order of almost anything I can ever imagine wanting. (When Amazon.com first started up, I always thought of it not as a bookstore, but as search engine and matching service for book lovers. Now it offers far more stuff.) Apps for my iPhone that enable me to immediately compare prices while I am in a store that has free wi-fi (i.e., Target, Lowes, Home Depot, etc.) (I don't even need their free wi-fi, but they offer it to customers.) Color laser printers. Digital cameras and software so that I no longer need a darkroom. I can remotely lock my door and set the alarm. With cameras, I can watch my house from afar. An inexpensive coffe maker so I can make my own lattes every day. Prepared foods at the grocery store, including sushi. (It may not be as good as sushi at a fine restaurant, but for the price it's not bad.) And more, and more, and more, none of it available just thirty years ago.  

The Catch-22 For Female Bosses

Men and women who rise to managerial positions face many similar challenges, but there are unique complexities in the female-to-female workplace dynamic. Studies dating back nearly 20 years examine both the differing communications styles and skills of female and male managers, and how this impacts their employees' job satisfaction. Data suggest that female employees reject women bosses who behave in a "masculine" or traditionally managerial way. Women employees, when surveyed about qualities they desire in their female bosses, react positively to empathy, support, sensitivity, and self-disclosure, which could well be characterized as historic female stereotypes. The attributes generally associated with male leaders — being persuasive, analytical, and action-oriented — are not influential in how women perceive their female superiors.

We might anticipate these stereotypes to change as more women enter organizations at a professional level, but biases change very slowly. More recent studies have made similar observations that "some skills and behaviors, may be considered essential for female managers but not for male managers." Women both expect more qualities, typically labeled "feminine," from their female superiors and give them lower ratings if found lacking. Women do not hold their male bosses to these same standards when evaluating them.

The catch-22 is that to advance in male-dominant organizations, women often must develop the more traditionally male traits. They generally attain their position through a heavy dose of the traditional male qualities we associate with success — determination, decisiveness, tireless work ethic, and effective use of authority. They repress their feminine qualities, only to find that the women whom they lead demand those more compassionate skills.

Story here. As I've argued before, unlike their male peers, from a very young age females are gender typed into behaviors that are not typically valued in labor markets. What this article is saying is that if they deviate from these roles and act more like males when they take on supervisory roles, they are scorned by the female employees under them. 

 

Four traits that predict whether a marriage will last or dissolve.

Dr. John Gottman, director of Seattle University’s “Love Lab” and founder of the Gottman Institute, has studied thousands of couples for decades. By dissecting every nuance of their rapport from eye rolls to shrugs, he can predict with 94 percent accuracy whether a relationship will eventually dissolve. Four traits turned out to be the most reliable predictors of a breakup (especially when they’re combined in some fashion).

And just what are those traits?

[C]riticism, contempt, defensiveness, and stonewalling. Criticism involves attacking your partner’s personality or character by saying something like, “you never help with the dishes” or “why are you always so late?” Contempt involves putting your partner down (i.e., “you’re stupid for believing that”). Defensiveness often involves rebuffing your partner’s complaint with one of your own (“I may be late, but you’re way too uptight about it.”) Stonewalling involves clamming up and refusing to hash things out with your partner at all. 

I concur with all of these. And I also agree with Terri Orbuch's recommendation for creating a happy marriage. I'm a lucky man!

In her research, she found that 67 percent of happy couples say their spouse “often” made them feel good about themselves, whereas only 27 percent of unhappy couples could claim the same thing. 

Merry Christmas . . . and a book recommendation.

Merry Christmas!

And may I recommend a book currently receiving a lot of positive press right now, from my esteemed colleague Adam English. I have read only an excerpt from The Saint Who Would Be Santa Claus: The True Life and Trials of Nicholas of Myra, but am waiting to read the rest of it now. Here's a nice review from the Wall Street Journal.

Gender Wage Difference Once More

I heard it said once, probably from Tyler Cowen, one of my professors from graduate school, that a man truly learns to treat a woman only after having a daughter. I concur with that. It makes you more aware of the differences in socialization between boys and girls, between men and women.     

Getting back to my previous post on gender wage differences, this sounds like a great book to read. It also explains and reinforces what Catherine Rampell discusses here.

Why do mothers earn so much less than both men and childless women?

In the United States, much of the “mommy penalty” can be explained by the types of jobs mothers versus non-mothers take. In particular, compared with non-mothers, mothers end up in jobs that pay a higher share of their compensation in benefits rather than wages.

If the difference is a problem of marketplace discrimination, then it's rampant all over the world. In fact, the U.S. is really no different than the OECD countries as a whole. 

Why Women Earn Less Than Men

The best strategy for negotiating, either as a buyer or as a seller, is being willing to walk away from a deal. But being willing to walk away from a deal also means being able to walk away from a deal.

For example, if you are negotiating the purchase of a new car and are indifferent between the one about which you are negotiating and another or others, you have bargaining leverage since you can walk. If you're dead set on that car, be willing to pay a premium.

The same applies to the seller. If the seller of the car has more than one prospective buyer, she has leverage since she can walk away. If there are no other potential buyers, she better begin accepting lower offers.

In yesterday's New York Times, Jessica Bennet explains a primary reason for why women earn less than men.

For years, legislators and women’s advocates have been seeking solutions. In many ways, the wage gap is a complicated problem tied to culture, tradition and politics. But one part of it can be traced to a simple fact: many women just don’t negotiate, or are penalized if they do. In fact, they are one-quarter as likely as men to do so, according to statistics from Carnegie Mellon University. So rather than wax academic about the issue, couldn’t we simply teach women some negotiation skills?

So one remedy for the wage gap is simply to teach women how to be better negotiators.

At Mount St. Vincent, the Smart Start workshop is broken into sections: understanding the wage gap, learning one’s worth on the market, and practical negotiation, in which students use role-playing in job-offer situations.

Women learn never to name a salary figure first, and to provide a range, not a number, if they’re pressed about it. They are coached not to offer up a figure from their last job, unless explicitly asked. The use of terms like “initial offer” — it’s not final! — is pounded into them. And, perhaps most important, they learn never, ever, to say yes to an offer immediately.

“I can’t tell you how many times I hear stories of women who go into a negotiation saying, ‘Oh my gosh, thank you so much, I’ll take it!’” says Ms. Houle, noting that one student she coached even hugged her boss. “Here these women are, more educated than ever, incurring incredible debt to get that education, and they’re going to take whatever they’re offered. It’s like, ‘No, no, no!’ “

This, along with other reasons, explains much of the gender wage inequality we observe in this country. But there are still other reasons that lead to women earning less than men, none of them having anything to do with discrimination against females. 

First, for women who do work—and this has increased considerably since the 1950s—they have typically been the secondary income earners for their families. This means that a wife has a more inelastic supply curve for her labor services relative to her working husband. This exacerbates the problem of women being poor negotiators. For example, a married man may seek a new job and, since moving anywhere is usually an option for him while searching, he has many companies from around the U.S., and even the world, bidding for his services. Once he chooses a job and moves his family to that location, the wife is now limited in her job search to that geographical location. She has fewer companies competing for her services relative to her husband. 

Second, and very important, women are gender-typed from a young age into adopting roles and skills that are not necessarily desired in labor markets. I explain this here. It is also demonstrated in a different way by these commercials. What this does is encourage women into self-selecting careers that typically pay less than careers where risk-taking and discovery and innovation are desired.

The solution is not to impose more legislation, which simply makes it less attractive for firms to hire women, especially the least skilled women. Instead, we must do a better job of socializing females, from a very young age, into adopting roles that have high labor market potential.