My teaching style varies with student need, trying to meet individuals where they are and appreciating the barriers they may face.
Putting it perhaps too coarsely, I will have a rough impression of a student as either “capable” or “not capable”, cautiously using these words as a catch-all for knowledge, skills, and personal engagement with the course materials. At the same time, students have their own views on whether they are or are not “capable.” Teaching is an ongoing conversation that informs and clarifies these perceptions, and on my behalf also involves adopting an appropriate style for each of the four possible situations in this rubric.
Inequality erodes opportunity, and limited opportunity exacerbates inequality.
This vicious inter-generational cycle has brought inclusive growth into question, contributed to the rise of populist sentiment, and strained the social contract in many rich countries. The way forward for researchers and policy makers requires not only a clear understanding of the facts about what kind of inequality matters and how it matters, but also an ethical grounding that speaks to the outcomes and opportunities that are important to citizens not only in the here and now, but also in the next generation.
This is the major message of a presentation I will be giving to the faculty and students of the PhD program in Economics at The Graduate Center of The City University of New York, where I am lucky to work and teach. My presentation—which also has the great benefit of being discussed by my soon-to-graduate PhD student, Aman Desai—makes this case by addressing three related questions
What do we care about?
We care about self-realization that contributes to an expanding and inclusive community that in turn enhances the capacities of its members to become all that they can be. And this involves caring about a sense of progress, a sense of movement toward security and inclusion, and a sense of fairness.
What do we measure?
Empirical researchers studying intergenerational mobility need to align what they measure with what we care about, which asks for an eclectic use of statistics and a sometimes subtle appreciation of how they relate to what we care about.
What should we do?
Certainly public policy should be evidence-based, but it needs increasingly to be ethically-grounded, with researchers bringing their numbers to public policy by explicitly making their own values clear. In my view, three values should guide public policy toward what we care about: all humans are equal, and should be treated with dignity; labour has preference over capital; and wealth is created to be shared.
But what gives this presentation an extra spice, at least for me, is that April 10th, 2025 marks the 100th anniversary of the publication of F. Scott Fitzgerald’s novel, The Great Gatsby. So it is fitting for me to begin the presentation with a bit of biography on how the Great Gatsby Curve got its name!
Feel free to download the presentation slides, and certainly if you are at the Graduate Center, to attend the presentation!
Scarcity is a simple idea, yet it has major implications.
If, as individuals or as a society, we have multiple objectives, and if our desires for these goals exceed the time and resources that can be used to attain them, then given that these resources can be used in different ways it matters how we allocate them. It matters because our goals differ in their significance.
Lionel Robbins, who taught at the London School of Economics, defined economics as “the science which studies human behaviour as a relationship between ends and scarce means which have alternative use” in a book published in 1935.
We have to choose, we have to recognize the terms of the trade-offs between the choices available to us, and we have to do this in a way that gets us as much as we possibly can from the scarce resources available to us.
The economic way of thinking gives us guideposts for making these choices, most notably that we should pursue an objective up to the point that the additional benefit we get from taking an extra step toward it just equals the additional cost in all the things we have to give up in making that step.
Economics certainly should not inform all public policy discussions.
But when it should and doesn’t, the decisions made are usually done from an overly short-term perspective, are not mutually consistent, generally have hidden or unintended consequences, and are not sustainable in the long-term.
In the next two lectures of our course Economics for Everyone we detail the logic of scarcity, the rules it implies for maximizing our social benefit, and the pitfalls that sometimes confound policy makers. Scarcity also takes us toward a discussion of an important policy, “Free Trade,” and our discussion also helps us highlight some of the blind spots of simplistic economic reasoning.
Download the presentation for Lectures 2 and 3, but if you want to prepare in an entertaining way listen to Billy Bragg sing out his thoughts on Free Trade, a 2010 song from Britain foreshadowing many of the debates that have motivated recent American policies.
Here are the lyrics, but I’ve added a quote from another famous economist, David Ricardo, who has a very different view. Our goal is to understand these two competing perspectives on the benefits and costs of Free Trade.
The summer issue of the Journal of Economic Perspectives will feature a collection of articles on inequality and the top 1%, some of which are now being circulated by the authors.
The paper by Tony Atkinson and his coauthors, “The top 1 percent in international and historical perspective,” is available in this post, and “The Pay of Corporate Executives and Financial Professionals as Evidence of Rents in Top 1 Percent Incomes,” by Josh Bivens and Lawerence Mishel, is available on the Economic Policy Institute website.
My contribution to the collection is based on the notion that the inequality literature has paid little attention to the intergenerational consequences of increasing top income shares, and it can be read as a counterpoint to Mankiw’s piece, or at least to his claim that inequality of opportunity is not a reason to worry about the top 1%.
“The idea that all citizens should have an equal chance to succeed in life, regardless of where they start, is fundamental to liberal societies and emblematic of the American—and Canadian—dream” is the way a Canadian think tank, Canada2020, introduces a panel discussion it hosted that explored the idea of economic mobility, why it is important, and how it is related to inequality of outcomes.
I was a member of the panel and had a very interesting—and at times humorous and entertaining—discussion with Zanny Minton Beddoes the economics editor of The Economist, Carolyn Acker the founder of Pathways to Education, and Ron Haskins a senior fellow at the Brookings Institution. You can view the entire discussion, which was moderated by Diana Carney, by clicking on the following screen shot (and waiting a bit for it to load):
I plan on revising the background document I wrote for the event—which you can download from the Canada2020 website—and would therefore be very pleased to hear your views on the discussion, and any specific feedback you might have.
The Universal Declaration on Human Rights, which we celebrate every December 10th, offers both a powerful and beautiful statement of what it means to be human and the goals we should pursue as a society. But the Declaration is an incomplete guide to designing the programs to meet these goals: it offers inspiration to advocates, but not a guidebook for pragmatists.
Pragmatists and policy makers need to read the Universal Declaration through the lens of economists, rather than don the robes of lawyers.
Economics for public policy 