Category: Equitablog

Should-Read: Paul Krugman: Shifts Get Real: Understanding the GOP’s Policy Quagmire

Posted on by Brad DeLong

Should-Read: Why are the Republicans—Ryan, McConnell, and Trump, all—proposing a tax cut for the upper class substantially funded by a tax increase on the largely-Republican upper middle class anyway?

Paul Krugman: Shifts Get Real: Understanding the GOP’s Policy Quagmire: “There are crucial links between the health care faceplant and the bad news (for the GOP) on taxes — links both causal and… cultural… https://krugman.blogs.nytimes.com/2017/09/30/shifts-get-real-understanding-the-gops-policy-quagmire/?_r=0

…Republicans took power in January determined to cut taxes on the wealthy, bigly. That has, after all, been the GOP establishment’s overriding priority for four decades; it’s what donors demand. But they’re somewhat constrained by concerns about deficits. It’s not that they themselves care about red ink: nobody with influence in the GOP has ever cared about federal debt, least of all the deficit peacocks who preened and posed as apostles of fiscal responsibility. But all that posturing makes budget-busting tax cuts awkward. And procedural issues in the Senate also make it hard to do too much budget-busting without 60 seats….

Republicans have always claimed that they can cut tax rates without losing revenue by closing loopholes. But they’ve always avoided saying anything about which loopholes they’d close…. But… the shifts need to get real. So where will the money come from? The bright answer in Trumpcuts is, end the deduction for state and local taxes (SALT)… punish blue states…. But there are a lot of Republican voters in blue states…. And who are these voters?… Affluent but not super-rich… for whom deductibility of SALT is a big deal. As the details of the plan sink in, these people will scream bloody murder, and their representatives will become a big problem for the leadership.

So what were they thinking? My guess is that they weren’t…. We learned from health care was that after 8 years, Republicans had never bothered to learn anything about the issues. There’s every reason to believe that the same is true for the distribution of tax changes, which Paul Ryan called a “ridiculous” issue and presumably nobody in his party ever tried to understand. So now the lies and willful ignorance are catching up with them — again.

More U.S. men are becoming nurses but not entering other traditionally female occupations

Posted on by Emilie Openchowski
A patient and a registered nurse in a hospital in Chicago. The number of male registered nurses in the United States has increased substantially over the past 40 years.

As U.S. manufacturing jobs have waned, and the service and health care sectors have flourished over the past few decades, a growing number of men are leaving behind traditional factory or industry jobs for a new title: nurse. A new Equitable Growth working paper by University of Louisville’s Elizabeth Munnich and University of Notre Dame’s Abigail Wozniak documents the substantial increase in the share of male registered nurses over the past 40 years, going from 2.2 percent in 1960 to 13 percent in 2015. (See Figure 1.)

Figure 1

Nursing is one of the most gender-segregated professions both in the United States and internationally. Many men entered nursing well into the 19th century, but the profession became the exclusive domain of women during the Industrial Revolution, thanks to a combination of cultural mores and legal barriers that kept men out. But over the past 40 years, things began to shift: Nursing schools were required to admit men, nonhospital based programs made it easier to obtain degrees later in one’s career, and the work became more physical in nature, possibly making it more attractive to men.

A registered nursing certification can be obtained through a two-year postsecondary school certification, meaning that it is a career that does not require a bachelor’s degree, although many nurses do have them. In fact, Munnich and Wozniak find that both men and women are more likely to become an RN as they age through their late 30s, implying that many enter nursing after pursing other professions initially.

The authors find that a shift in gender norms also played a substantial role in the rise of male RNs. Munnich and Wozniak discuss the way that organizations such as the American Assembly of Men in Nursing were established in the 1970s, and how some philanthropic foundations began to target their efforts toward recruiting and retaining male nurses. Campaigns aimed specifically at men began to crop up, with tag lines such as “Are you man enough to be a nurse?”

This research should be viewed in the context of the decline of many middle-skilled jobs over the past 40 years, which have hit male-dominated industries such as manufacturing particularly hard. Earnings for men with a high school degree declined over the same period in which relative earnings for RNs increased as part of a growth in relative earnings for skilled workers more generally. But notably, since 1990, median earning levels for RNs have been on par with college-equivalent workers. (See Figure 2.)

Figure 2

The two authors suggest that this has made nursing “considerably more attractive relative to jobs not requiring a college degree.” Munnich and Wozniak do not, however, look at how much of the increase in wages for RNs was driven solely by the growing share of men entering the profession. Other research documents that occupations with more men tend to be paid regardless of skill or education level. In fact, gender differences in occupations and industries account for more than half of the gender wage gap.

The authors’ findings are notable, given that they do not represent a larger trend of men entering traditionally female jobs. Munnich and Wozniak say that there was no similar uptick in the share of men in female-dominant professions such as primary and secondary teachers, bank tellers, and physicians’ assistants. Even though female-dominant occupations are some of the fastest growing in the United States, many men have been reluctant to take these jobs, with some men preferring to drop out of the labor force altogether—over the past few decades, men’s labor force participation has dropped precipitously.

What’s more, the authors also find that men are less likely to take nursing jobs during economic downturns, preferring to retreat to more traditional occupations. More work needs to be done to understand why.

Munnich and Wozniak’s research documenting the rising share of men in nursing is an important case study of how to move more men into a high-growth middle-skilled occupation. The authors suggest access to community college and degree certification programs will go a long way to bolstering the trend. But further research into what makes nursing unique—and why other female-dominant industries have not seen an equivalent influx of men—is crucial to address declining male labor force participation and help men adapt to the changing economy.

For more information on occupational segregation, check out our fact sheet here.

What explains the rising share of U.S. men in registered nursing?

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Authors:

Elizabeth Munnich, Assistant Professor of Economics, University of Louisville
Abigail Wozniak, Associate Professor of Economics, University of Notre Dame

Abstract:

This paper documents four decades of increasing participation in registered nursing among US men and explores reasons for this change. We find that a large component of the increase is due to men switching into nursing in their twenties and early thirties. Increasing educational attainment, rising labor demand in healthcare, and liberalizing gender role attitudes explain around 50 percent of the growth. Important countervailing factors include poor early labor market conditions and immigrant inflows, both of which are associated with less movement into nursing by men. We discuss the implications of our findings for policies to encourage men to take up high growth, nontraditional skilled jobs.

Should-Read: Karl Smith: The Big Six Tax Reform Framework: The Good and the Bad

Posted on by Brad DeLong

Should-Read: OK. But where is The Ugly?

Karl Smith: THE BIG SIX’S TAX REFORM FRAMEWORK: THE GOOD AND THE BAD: “For individual taxpayers, we see a meaningful effort to curb and slowly eliminate the myriad of deductions and loopholes that plague the tax code… https://niskanencenter.org/blog/big-sixs-tax-reform-framework-good-bad/

…On the corporate side, the move to a territorial system is a step in the right direction, toward a system with less gamesmanship and fewer tax-avoidance strategies. That being said, I understand the incredulity and disgust provoked by the administration’s rhetoric. President Donald Trump explicitly rejected the tax reform label in favor of the more compelling, but far less accurate, language of a middle-class tax cut. We shouldn’t, however, let the president’s inanity drive our actual analysis of policy. If we do that, the imps win. Secretary of State Rex Tillerson said it best: “The president speaks for himself.”

There are two big elements in this package that tax reformers have been looking for—for decades. The first is an end to itemization in the individual tax code. The second is the move to destination-based taxation in the corporate code…

Should-Read: Michael Geruso and Timothy Layton: Selection in Health Insurance Markets and Its Policy Remedies

Posted on by Brad DeLong

Should-Read: Michael Geruso and Timothy Layton: Selection in Health Insurance Markets and Its Policy Remedies: “We begin by outlining some important but often misunderstood differences between two types of conceptual frameworks… http://www.nber.org/papers/w23876

…The fixed-contracts approach… views selection as influencing only insurance prices in equilibrium. The… endogenous contracts approach treats selection as also influencing the design of the contract itself, including the overall level of coverage and coverage for services that are differentially demanded by sicker consumers…. We discuss four commonly employed policy instruments….

  1. premium rating regulation, including community rating;
  2. consumer subsidies or penalties to influence the take-up of insurance;
  3. risk adjustment; and
  4. contract regulation.

We discuss these policies with reference to two markets that seem especially likely to be targets of reform in the short and medium term: Medicare Advantage and the individual insurance markets reformed by the Affordable Care Act of 2010…

Must- and Should-Reads: October 1, 2017

Posted on by Brad DeLong

Interesting Reads:

Must-Read: Pedro Nicolaci de Costa: Trump sees Fed chair nomination as a reality show

Posted on by Brad DeLong

Must-Read: Everybody should be very clear: Kevin Warsh is likely to be a disaster as Fed Chair—and a disaster for every class of assets:

Pedro Nicolaci de Costa: Trump sees Fed chair nomination as a reality show: “Neil Dutta, head of US economics at the research firm RenaissanceMacro, had this to say about the possible appointment of Warsh… http://www.businessinsider.com/trump-fed-chair-nomination-a-reality-show-2017-9

…a lawyer by training and a banker by profession — in a note to clients: “A client asked me ‘Can you tell me your thoughts on Kevin Warsh as the next Fed Chair? The likelihood as well as what type of chairperson they would be and how would the market react?'” His response confirms my own analysis.

Not positive. Yes, Kevin Warsh was a governor during the financial crisis. But, the way he has gone after the Fed since he has left probably has not endeared him to the people there. So, my primary concern is whether the organization would even respect him. Normally, the board’s staff assumes the chair knows the ins and outs of monetary economics at least as well as they do. Warsh would not be afforded that assumption. That is a big problem.

Warsh was consistently on the wrong side of the policy debate, Dutta adds… “calling for a sharp upturn in inflation when none arrived,” Dutta wrote. “He was originally sold as a student of the financial markets in 2006 but was grumbling about aggressive monetary action while the credit markets froze up.” As for his chances at clinching the post, Trump appears to be doing a good job of keeping the reality-TV-inspired suspense alive. “Trump met with Warsh,” Dutta said. “Fine. Should we draw a big line to an actual appointment? I am quite skeptical.” Not me. Stay tuned.

Should-Read: Daniel Davies (2002): Two Cheers for This Year’s Nobel Prize

Posted on by Brad DeLong

Should-Read: Daniel Davies (2002): Two Cheers for This Year’s Nobel Prize: “What the hell is an “ergodic process” when it’s at home?… http://blog.danieldavies.com/2002/10/

…Ergodicity is a statistical property…. With ergodic stochastic processes, collecting more data gets you a better and better estimate of what the underlying parameters of the process are, as the “noise” cancels itself out in some statistically well-defined way…. [But] to talk about “expectations” of the future states of a nonergodic system are meaningless; people might have opinions about the future, but there aren’t the solid linkages between these views and the actual data which one would need to call them “expectations”. Certainly, there isn’t enough to support the trick used by economists in using the expectations operator to make dynamic processes static so that they can be modelled tractably.

So what? Well, so this: Most processes which are characterised by positive feedback are nonergodic. Most economic processes of interest are subject to significant, destabilising positive feedback

It’s a real problem, and in my opinion, Paul Davidson ought to be looking at something like a Nobel Prize for being one of the few economists to take it seriously. (He won’t get it, of course, because this is way out of the mainstream of academic economics, where it is still considered the mark of a clever young man to say that “chaos theory never amounted to much”). Kahneman’s work is important, but in order to be a constructive contribution to some future correct theory of economics, it needs to be thought of as a description of human decision making and behaviour forming, not as a way of rescuing the broken models of expectations economics. So a hearty “Hip hip” from me, but I’ll be keeping the champagne on ice for the meantime…

Should-Read: Ricardo Hausmann: Making the Future Work for Us

Posted on by Brad DeLong

Should-Read: Ricardo Hausmann: Making the Future Work for Us: “To pessimists, the introduction of… general-purpose technologies – including 3-D printing, artificial intelligence, and the Internet of Things – threatens the demand for labor… https://www.project-syndicate.org/commentary/technology-future-of-work-by-ricardo-hausmann-2017-09

…without new forms of social solidarity, such as a universal basic income, the future will be one of widespread destitution. To optimists, the latest technological developments, like others that have propelled humanity forward, promise to deliver unprecedented levels of prosperity. It is probably impossible at this stage to say which side is right….

Since as recently as 1980, most countries have experienced large declines in agricultural employment. In some, like Portugal, Malaysia, Turkey, and Indonesia, the share of agricultural employment declined by more than 20%. In others, like Greece, Italy, Bulgaria, Hungary, Estonia, Poland, Philippines, and Sri Lanka, the decline exceeded 10%. And it’s not just agriculture. According to the World Bank’s World Development Indicators, the share of manufacturing in GDP fell in 100 of the 124 countries reporting data since 1990….

[So]what makes today’s technology-driven shifts so scary?… Technology… depends on… embedded knowledge in tools; codified knowledge in recipes, manuals, and protocols; and tacit knowledge, or knowhow, in brains.
Most of the time, these… complement one another…. But technological progress occasionally substitutes one for another…. As David Autor of MIT has pointed out, the automatic teller machine (ATM) displaced human bank tellers, but so reduced the cost of branches that their number rose, fueling an increase in employees focused on customer relationship management…. But while it is clear which jobs new technologies displace, it is harder to anticipate how the new possibilities will be exploited…. Today we are trying to predict the nature of future work before the jobs of the future have been invented….

In the end, predicting the future is beside the point. Most countries’ future is more likely to be bright if they focus on ensuring that they can master every new technology and exploit every new opportunity that comes their way.

Must- and Should-Reads: September 29, 2017

Posted on by Brad DeLong

Interesting Reads: