Brian Leiter's Law School Reports

George Mason donor-contract disclosure case will be heard by the Virginia Supreme Court (Michael Simkovic)

A student group, Transparent GMU, has sued the George Mason University Foundation to try to force disclosure of donor contracts with the the Charles Koch Foundation and other conservative billionaire-backed foundations and re-granting organizations. 

George Mason is a public university.  A limited number of George Mason's donor contracts have already been disclosed.  Some of these contracts gave donors an inappropriate degree of influence which critics say may have politicized research.  However, contracts between donors and the George Mason University Foundation are at issue in the lawsuit.

A law clinic unofficially affiliated with George Mason University actively harassed climate scientists because of their research on global warming.  The clinic was led by a George Mason adjunct, staffed by George Mason students who received academic credit through a law-school-approved externship program, funded by donor groups similar to those supporting the law school, and named after George Mason, but was not officially part of the law school or under the control of its dean. 

The ultimate identity of many donors to George Mason and embedded think tanks and foundations on campus remains shrouded in mystery because of the use of re-granting organizations and donor-advised funds, but there are links to a group of prominent and politically powerful conservative billionaire families.

The George Mason University Foundation won the disclosure case at the circuit court level, but the case is now heading to the Virginia Supreme Court.

The case could have important implications for many universities who have received substantial donations from donors with strong ideological views. Public universities could be especially vulnerable to disclosure lawsuits.  

The advocacy group UnKoch my campus, which seeks to promote academic freedom and integrity by limiting donor control over university research, and the AAUP have developed kits to help universities ethically accept donations without impinging on academic freedom and academic integrity.  Some prominent conservative donors to law schools and universities, such as the Olin Foundation, have excellent reputations for respecting academic freedom. 

According to Conservative Transparency's data (see also here, here, and here), leading university and college recipients of donations from conservative groups include:

• Ave Maria and its law school (see also here),
• George Mason University, George Mason University School of Law, the George Mason University Foundation, the Mercatus Center at George Mason, and the Institute for Human Studies at George Mason, and the George Mason Environmental Law Clinic.
• The University of Chicago (and its law school),
• Hillsdale College
• Yale,
• Harvard and its law school
• Stanford, its law school, and The Hoover Institute

Of the leading 5 academic recipients from conservative donors, only George Mason is a public university.  Leading public university recipients include University of Oklahoma, Michigan State, the University of Virginia School of Law, and the University of Arkansas.

I am not aware of any database that tracks donations from ideologically left-wing groups.   If readers know of such a database, please direct me to it and I will update this post to include a list of leading recipients from liberal groups.   

Some critics worry that UnKoch myCampus's tactics at times might go too far and could make colleges and universities reluctant to accept funding that supports rigorous, unbiased, and non-ideological research which happens to be funded by conservative groups.

Updated 3/26/2019:  This article has been corrected to note that Transparent GMU, and not UnKoch myCampus, is the party to the lawsuit seeking disclosure and that the George Mason University Foundation, rather than George Mason University, is the defendant.

Tucker Carlson and I discuss the benefits of Higher Education and Student Loans (Michael Simkovic)

Last night I was invited to appear on Tucker Carlson’s show on Fox News.  For the last two nights, Mr. Carlson has been inveighing against higher education and federal student loans.  Mr. Carlson has been promoting a private-student-lender supported plan to tax higher education institutions that accept federal student loans. Similar plans to tax educational institutions were previously backed by both Senator Hillary Clinton and President Trump, with the support of several Wall Street connected think tanks.[1]   

Mr. Carlson and I spoke via a remote uplink from a Fox News affiliate in Los Angeles (Fox News’ headquarters is in midtown Manhattan, near Rockefeller Plaza).  The video appears here or here.  (There was a bit of a delay in the audio relay, so we sometimes speak at the same time).

Although my time was severely limited, and Mr. Carlson frequently spoke over me, I did manage to make a few key points:

 

• Higher education boosts earnings and employment by more than the education costs, to the benefit of both students and governments (see also here and here).

 

• The increase in earnings and employment is largely caused by the education.
  • (see also here, here and here for a review of the extensive empirical literature, including identical twin studies, instrumental variables studies, field experiments, quasi-experimental designs, OLS regression studies, fixed effects studies, and basically studies using every technique of causal inference know to professional labor economists)
  • We are about as sure that education increases earnings as we can be sure of anything in social science—the evidence is solid

 

• The federal government benefits more from higher education than universities do.
  • The increase in payroll and income tax revenue to the government from education is greater than the cost of tuition
  • Education also reduces costs to the government such as unemployment and disability insurance

 

• With symmetrical risk sharing (of both upside and downside) universities would be paid more by the government for providing education, not less.

 

• If the government invested more in education, the economy would grow faster and we would have more innovation, less unemployment, and a lower debt to GDP ratio.

 

• Student loan debt is actually too small relative to other assets and as a share of the economy to cause big problems--$1.5 trillion in student loan debt outstanding versus $104 trillion in household net worth; $200 trillion in present value of future government spending, and $1,000 trillion in present value of future US GDP.

 

• Federal student loans generally perform well. Federal student loan 3-year cohort default rates are only around 6 to 7 percent at 4-year-and-above non-profit and public institutions.  These default figures include students who start at such institutions but do not complete their degrees.  Recovery rates on defaulted loans are close to 80 percent.  (Defaults and problematic practices tend to be concentrated at for-profit universities, which Republicans have recently moved to deregulate). 

 

• Education boosts net worth in the long run, even after accounting for debt. People who are more highly educated not only have higher incomes, they also have higher savings rates and higher net worth. Among households headed by someone age 40 or older, those with professional degrees have median net-worth of $700,000 compared to only $100,000 for those with a high school diploma.  More highly educated heads of household also have significantly less debt relative to their assets.

 

• We are underinvesting in education. Increases in the costs of education pay for themselves in higher quality.

 

• University administrators are not overpaid.
  • There’s a market for executive talent in which universities must compete.
  • Many private industries pay managers more than universities and have a higher concentration of managers than universities
  • Universities pay their top executive leaders less than private sector companies pay senior executives (at the top, around $5 million at universities versus around $150 million at publicly traded corporations). Pay is lower for top executives in academe even after accounting for institution size. 
  • For example, Fox News, with only around $2.7 billion in revenue, recently paid its chief executive $21 million dollars in total compensation.  NYU, the largest private, non-religiously affiliated university in the United States recently paid its president $1.5 million.  NYU has $10 billion in operating revenue. Scaled by revenue, NYU pays its chief executive only 2 percent as much as Fox News pays its chief executive (i.e., Fox News pays its chief executive 50 times as much per dollar of revenue as NYU pays its chief executive).
  • NYU's business--which includes hospitals, biomedical research, and scientific and engineering labs--is far more complicated and far more socially valuable than Fox News' entertainment business.  Fox News has never saved anyone's life. NYU Medical Centers and other university based medical facilities have. Fox News has never trained anyone to become a doctor, lawyer, or engineer.  NYU and other universities have.

 

For more information, see:

1. Michael Simkovic, The Knowledge Tax, 82 U. Chi. L. Rev. 1981 (2015).
2. Michael Simkovic, Risk-Based Student Loans, 70 Wash. & Lee L. Rev. 527 (2013).
3. Frank McIntyre & Michael Simkovic, Timing Law School, 14 J. Empirical Legal Stud. 258–300 (2017).
4. Michael Simkovic & Frank McIntyre, The Economic Value of a Law Degree, 43 J. Legal Stud. 249–289 (2014).
5. Michael Simkovic & Frank McIntyre, Populist Outrage, Reckless Empirics: A Review of Failing Law Schools, 108 Nw. U.L. Rev. Online 176–280 (2014).
6. Michael Simkovic, A Value-Added Perspective on Higher Education, U.C. Irvine L. Rev. (2016).

 

With the benefit of more time, I could have pointed out a few more things and corrected some more inaccuracies, described in greater detail below:

 

Education supports the housing market

While highly educated people may delay buying a home until later in life, when they do buy a home, they typically buy substantially more expensive and nicer homes.  According to the Census Bureau’s ACS, among those age 25-35 in 2010-2014, average home values ranged from $130K for those with a high school diploma to $240K for those with a bachelor’s degree and $340K for those with a professional degree.

Thanks to education, which boosts earnings by more than it costs, educated workers can more easily afford better housing than their less educated peers.

This benefit redounds to homeowners more broadly.  Only around one third of the population has a bachelor’s degree or above, but more than half of households are homeowners.

New housing can be built, but in many areas of the country where highly educated workers congregate (New York, Boston, San Francisco, Los Angeles, etc.), restrictive zoning laws that limit new development give existing real estate owners substantial market power.  As younger, more highly educated, and harder working workers compete with each other for limited housing stock, housing values go up. 

This increase in home values enables existing homeowners (who might be less educated given trends toward increasing educational attainment) the opportunity to sell at a higher price to fund a more comfortable retirement in a more tranquil area, further from centers of economic activity.

 

Education makes Social Security more generous and helps keep Medicare solvent

Programs like Social Security and Medicare are currently funded exclusively through taxes on wages, but not through taxes on income from financial or physical capital.  Investment in education therefore helps fund Social Security and Medicare in ways that other kinds of investments do not.

Social security is indexed to wages, which have increased more than inflation.  A big part of the reason average real wages are rising is because of increasing educational attainment.  Thus, as the population becomes more educated and productive and average wages increase, social security becomes more generous and benefits to everyone increase at a pace faster than inflation.

This illustrates a broader point—education is good for everyone, not just the educated.  Education produces positive externalities, and the benefits of education can be—and are in fact—shared through taxation and spending.

 

People who are more highly educated are more likely to be married

See here.

 

Educated workers make financial sacrifices to work in higher education

Education typically boosts earnings, but academics typically earn far less than individuals with comparable skills and training who work in the private sector.^[2] There is evidence that universities struggle to attract and retain faculty with skills that are highly valued in the private sector.  Computer scientists and economists are leaving even the most prestigious universities for technology firms.   Universities tend to be relatively shorthanded in high-demand fields like computer science, some engineering specialties, accounting, and economics.

Many law schools already have far more full-time tenure track faculty in public law than private law, even though the career opportunities for their students are far better in the private sector. The former dean of Stanford Law School left the academy to practice law.  Tenured tax professors have left tenured positions for much higher pay at accounting or law firms.  

 

Billionaires are rich; Universities, considerably less so

Most universities are not rich. Household net worth in the United States is over $100 trillion.^[3]  The endowment of all of the colleges and universities in the United States—which support hundreds of thousands of employees in the service of millions of students and other stakeholders—is between $500 billion and $1 trillion—i.e., less than 1 percent of household net-worth.^[4]

Wealthy individuals single-handedly own more investible assets than entire universities. The total net-worth of the Forbes 400—the 400 richest individual people—is $2.7 trillion,^[5] roughly four times the aggregate combined endowments of the thousands of colleges and universities in the United States.  Bill Gates and his family foundation control more wealth than the endowments of Harvard, Yale, and Princeton combined.  One of Mr. Gates’ residences is worth 15 times the typical endowment of colleges or universities.^[6]

Because of their great wealth and the opportunities it provides to influence tax law and engage in tax planning, billionaires pay lower effective tax rates than upper middle class educated professionals such as scientists, engineers, doctors and lawyers.  Indeed, the very rich are so rich that the U.S. could generate hundreds of billions of dollars of additional tax revenue per year without raising taxes on 99.9 percent of the population, could use this revenue to provide middle class tax relief and make public investments that would accelerate the rate of economic growth and innovation, and would still leave the top 0.1 percent by wealth much better off financially after taxes than everyone else.

When another recent guest on Tucker Carlson's ostensibly populist program questioned Mr. Carlson's reluctance to discuss taxing the wealthy, Mr. Carlson became verbally abusive.  Carlson told the guest, a popular history writer who has lectured at Davos, "I want to say to you, why don’t you go f-ck yourself, you tiny brain."  Fox News declined to air the segment, but the tape was leaked to Rolling Stone.

 

Most college degrees are in practical fields, and even “impractical” majors often provide some economic benefits

Most fields of study at universities are scientific, technical, business or economics, or career oriented. According to data from the U.S. Census Bureau’s ACS, degrees in such practical fields comprise roughly 70 to 75 percent of recent bachelor’s degrees (i.e., degrees of those under age 30). 

Mr. Carlson raised the red herring of “women’s studies” to support his claim that there’s a lot of waste in higher education.  Women’s studies is such a small field of study that bachelor’s degrees in women’s studies are not even reported as a separate category by the Census Bureau, but are instead (to the best of my knowledge) lumped in with “1501: Area, Ethnic, and Civilization Studies.”  This category accounts for only 0.44% of bachelor’s degrees.

Although humanities and social sciences degrees (other than economics) boost earnings less than STEM or economics degrees, humanities and social science degrees still boost earnings compared to a terminal high school diploma.  Humanities and social sciences degrees can also pave the way for graduate degrees that provide large boosts to earnings.  People who cannot successfully complete a STEM degree in a reasonable amount of time may be able to complete a humanities degree more quickly.

 

Student loan default rates today are less than half what they were in the late 1980s and early 1990s, and are again trending down

See here. In the 1990s, the DOE reported 2-year CDRs, which are always lower than the 3-year CDRs which it reports now, so the decline in defaults is even more dramatic.  Three-year CDRs have been trending down since 2010/2011 at the peak of the recession (see also here).  See here to put undergraduate debt in context. 

 

Public investments in education can be broader than federal student loans

Student loans are one of many ways of investing in education.  Publicly funded grants, reduced student loan interest rates, debt forgiveness and other approaches could also be profitable investments for the benefit of taxpayers, similar to the benefits of the GI Bill.  These policies could both help society and help students.

The bottom line is, we as a society should be investing more in education at all levels, not defunding one educational program to pay for another.

 

[1] The plan is being marketed as promoting university “accountability” for borrower defaults. But in our specialized economy, it is the job of lenders to absorb and spread risks associated with lending, and the job of other institutions to provide goods and services.  We do not expect homebuilders to pay when home buyers default on their mortgages, nor do auto-manufacturers pay when a car buyer defaults on his or her car.  The government can easily absorb student loan defaults while still turning a profit on its loans (see also here), especially when we factor in increased tax revenues and other associated public benefits of education. 

 

The proposal to charge universities for defaults on federal loans is little more than a tax on educational institutions that would hurt taxpayers and students, and only stand to benefit private student lenders. 

 

[2] John Barnshaw & Samuel Dunietz, Busting the Myths: The Annual Report on the Economic Status of the Profession, 2014-15 (2015), https://www.aaup.org/reports-publications/2014-15salarysurvey (last visited Jun 14, 2018) (“professors make less on average than those in nonacademic professional settings.”); Keith A. Bender & John S. Heywood, Job Satisfaction of the Highly Educated: The Role of Gender, Academic Tenure, and Earnings, 53 Scottish Journal of Political Economy 253–279, 258 (“Overall, academics have an average salary of $59,881, while nonacademics earn $80,070 on average. Across disciplines this ranges from lows of almost $54,000 for academic social scientists to highs of over $100,000 for management scientists and health scientists in the nonacademic sector.”); William G. Tierney, Faculty Productivity: Facts, Fictions and Issues 129 (1999) (“Compared to an index of salaries in professionalized fields outside higher education [health professions, law, engineering, and nonacademic scientists], faculty salaries have lost substantial ground since the late 1970s.”).

[3] Board of Governors of the Federal Reserve System (US), Households and Nonprofit Organizations; Net Worth, Level [TNWBSHNO], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/TNWBSHNO, June 14, 2018.

[4] U.S. Department of Education, National Center for Education Statistics, 2015 Digest of Education Statistics, Table 333.90.

[5] Luisa Kroll, Forbes 400 2017: Meet The Richest People In America, Forbes, 2017, https://www.forbes.com/sites/luisakroll/2017/10/17/forbes-400-2017-americas-richest-people-bill-gates-jeff-bezos-mark-zuckerberg-donald-trump/ (last visited Jun 14, 2018).

[6] There are close to 5,000 post-secondary institutions in the United States, most with very small endowments. The median endowment was $7.9 million and the mean was $10 million according to a 2014 report. American Council on Education, Understanding-Endowments (2014), http://www.acenet.edu/news-room/Documents/Understanding-Endowments-White-Paper.pdf.  Mr. Gates’s lakefront compound, “Xanadu 2.0,“ was reportedly worth around $124 million in 2014. More recent estimates place the mansion’s value between $150 and $200 million.

At Yale, the Federalist Society loses friends and alienates people (Michael Simkovic)

Yale’s Federalist Society provided a platform on campus to an anti-gay group which has been identified by mainstream media organizations and the Southern Poverty Law Center as a hate group because—unlike some religious groups that have misgivings about the theological acceptability of homosexual acts—this group has advocated for criminal prosecution of homosexuals by secular authorities at least as recently as 2013 (see here, here, and here). 

Many Yale students predictably responded by losing respect for both the Federalist Society and for the students who invited the alleged hate group to campus.

Although most Christians—especially young and highly educated Christians—favor greater acceptance of gays, a leader of the Federalist Society claimed that by inviting the anti-gay group he was simply “attempting to be a Christian at Yale Law School.”

The numerous Christian groups that are active at Yale did not band together to invite to campus a group that has advocated criminal prosecution of homosexuals.  That decision was the sole prerogative of the Federalist Society or some of its members. 

The leader of the local Federalist Society’s account of events appears here.

He acknowledges that he is viscerally angry at his classmates, but praises the Yale faculty for supporting free speech.

The entire unfortunate turn of events could have been avoided if the Federalist Society vetted its speakers more carefully and favored substance over shock value.  There are plenty of other highly capable lawyers who can argue effectively for religious freedom in situations that challenge progressive views of gay rights, and who are not associated with any actual or suspected hate groups.

If the Federalist Society leader had allowed himself to cool off before publishing his essay, he might have considered that the best way to demonstrate “Christian love” and “forgiveness”—as he claims to want to do—might not be to refer to those who disagree with him about controversial social issues as "over-the-top" "enemies" organized in "an alphabet soup of identity groups" which "attacked" him with "snarky, vitriolic . . . progressive" words because they are neither "adults" nor "serious thinkers" "even by Yale standards."   

I can empathize with the Federalist Society leader’s aversion to the harshness of internet trolls these days. 

But he should not suggest that those who disapprove of or could be hurt by his actions include only gays, women, racial and religious minorities, and liberals.

Why are leaders of the Federalist Society mischaracterizing Christianity as monolithically hostile to gays and other minority groups?  Intent is always perilous to guess.  However, given Republican donors' history of nationally coordinating provocation campaigns that are executed through local campus chapters, conservative groups may be attempting to incite conflict between Christians and other progressive and moderate groups.  Many Christians and progressive, moderate and conservative groups favor family-friendly economic policies and lower taxes on churches and religious schools, including non-profit universities.  While such policies provide economic benefits to society as a whole, they are often opposed by political donors who fear that they could be funded through higher taxes on the very wealthy. 

Accusing universities of being anti-Christian is a conservative political tactic that dates back to the book that launched the McCarthyist and FBI informant William F. Buckley's career.

Whether or not conflict is being intentionally provoked here, a more constructive approach for all concerned would be to focus on building solidarity across ideological lines rather than engaging in such polarizing conflict on social issues.

HeinOnline and co-authored articles

Dru Stevenson (South Texas) writes:

I've enjoyed your recent blog posts about the law school rankings. As far as I can tell, HeinOnline counts two-author articles as an article for each coauthor, which means that when faculty at the same school coauthor an article, citations to that article count once for each author, and twice for the institution, no?  In other words, for lower-ranked law schools that are concerned about their scholarly rankings, co-authored publications from their own faculty count double.  When USNews starts using HeinOnline citation counts, it will reward  institutions where a lot of professors co-author articles.  I'm not sure this would be a bad thing - coauthorship is much more common in some other academic disciplines, and I think the legal academy might benefit from more collaboration and scholarly mentoring relationships.  But it also is susceptible to gaming, of course.  Any thoughts on this?

Does anyone know if this is how Hein searches will work?  And thoughts on Professor Stevenson's question also welcome.  Signed comments will be strongly preferred, thanks.

The USNews.com roller coaster

Blog Emperor Caron unwisely hypes his school's favorable overall ranking in the USNews.com charade.  This is unwise because it legitimates the nonsense number (i.e., the overall rank), which will likely come back to bite Pepperdine in another year (much as they got bitten rather unfairly last year).   With resources, any school can move up in the rankings by shrinking their student body (especially the 1L class) and holding everything else constant.   As I've noted before, almost every change, for better or worse, in the USNews.com overall ranking has nothing to do with reality:  it reflects moves to game the rankings either by the school doing better, or by one's immediate competitors for those schools that do worse.  

The Blog Emperor also usefully produces the "peer [academic] reputation" scores for the most recent law school rankings.   These scores typically track the overall USNews.com ranking in recent years, with small deviations.  This year's amusing small deviation is for Yale, which comes in at 4.8, behind Harvard and Stanford at 4.9.  Yale is still #1 in the overall ranking, while Harvard is #3, behind Stanford at #2--the way it's been for a number of years now. This result is entirely a function of one-and-only one factor (which USNews.com doesn't print):  spending per capita.  Harvard is rich but large, with economies of scale for which it is penalized in the ranking formula; Yale and Stanford are rich, but very small. Hence the results.

 

 

White House proposes to spend approximately nothing on early childhood education to minimize taxes for top 0.1 percent (Michael Simkovic)

NPR reports that the Trump administration has proposed a meager one-time increase in funding for childcare / early career eduction equal to approximately 0.0045 percent of GDP ($1 billion out of $22 trillion estimated 2020 GDP) or about 0.001 percent of household networth.  Total federal spending would increase to $5.4 billion, or 0.0225 percent of GDP. 

In contrast, Senator Elizabeth Warren has proposed to spend approximately $70 billion per year on childcare and early childhood education--13 times as much as President Trump.  Warren's plan would be financed with approximately one third of the revenue generated by an annual ultra-high net-worth wealth tax of 2 percent on personal fortunes above $50 million, and 3 percent above $1 billion.  It would therefore cost 99.9 percent of households nothing in increased tax burdens.

The White House explained that its less generous proposal was motivated by a desire to avoid spending "unsustainable amounts of taxpayer dollars" and instead come up with a plan that would be (politically) "viable."  

Ultra-high net-worth taxes approximately 4 to 6 times as high as those proposed by Senator Warren are likely financially sustainable, given typical returns on leveraged investment portfolios favored by the ultra-wealthy and Senator Warren's willingness to increase enforcement budgets and impose exit taxes.  (For those who are more visually inclined, the voluntarily publicized personal spending habits of U.S. billionaires (see also here or here), though not quite as extreme as Louis XIV of France, suggest that perhaps some might be able to afford to pay a bit more in taxes while still enjoying a comfortable lifestyle).

Recent corporate tax cuts signed by the Trump administration cost approximately $100 billion per year in foregone revenue, according to the JCT.

According to NPR, an unofficial Whitehouse spokesperson, Ivanka Trump, claims that limiting public funding for childcare and loosening government oversight and reducing minimum quality requirements for childcare will "encourage innovation."

Peer reviewed studies have long found that stricter regulation is associated with higher quality childcare.

High powered studies with experimental designs which are ideal for causal inference have repeatedly found evidence that smaller class sizes improve outcomes.  Indeed, Kindergarten class size has a large and significant effect on college attendance decades later, and kindergarten teacher experience predicts earnings later in life (see also here).  Returns on public investment in education are generally more than high enough to pay for themselves.

A recent study sponsored by the free-market think tank, the Mercatus Center at George Mason University claims that deregulating childcare could reduce costs without reducing quality, but is based on remarkably scant evidence.  According to the authors, deregulation can have a salutary effect because factors such as the number of care givers per child and the level of training of caregivers actually have no relationship to quality. 

The Mercatus study presents no novel findings about quality, and instead relies on a selective review of the literature, with an emphasis on underpowered studies and specifications that (unsurprisingly) did not always produce statically significant results.  Even then, the analysis finds that higher wages for caregivers and other factors that increase costs are in fact associated with higher quality.

The only evidence presented in the Mercatus study is a simple regression relating tuition costs to regulations mandating higher caregiver training levels and smaller class sizes. In other words, Mercatus finds only evidence that quality comes at a cost, not that deregulation reduces costs without impairing quality.

The Mercatus Center at George Mason University is sponsored by donations from wealthy conservatives that in the recent past have been structured to benefit only researchers with economically conservative views.

In Memoriam: Robert S. Summers (1933-2019)

Alas, there are a lot of passings of notable figures in the legal academy the last couple of days:   Robert Summers, emeritus at Cornell where he spent four decades, who was well-known for his work on commercial law and legal theory, has also died.  The Cornell memorial notice is here.

(Thanks to Brian Bix for the pointer.)

In Memoriam: William C. Powers, Jr. (1946-2019)

I was shocked to learn of the passing of Bill Powers, former Dean of the Law School and President of the University of Texas at Austin, as well as a leading authority on tort law.   I was fortunate to be his colleague and to serve on the faculty at Texas when he was Dean; he was a brilliant and shrewd leader, with excellent academic values and judgment, and great people and political skills.  He improved both the Law School and the University.  He was also a popular and beloved teacher.   The UT Austin memorial notice is here.

QJE: Investments in education continue to provide economic benefits two and half centuries later (Michael Simkovic)

A recent article in the Quarterly Journal of Economics (the leading journal in economics) finds evidence that early investments in education in the 1600s through mid 1700s continued to provide economic benefits in the form of persistently higher eduction levels and 10% higher wages and centuries later.  

The study examined the economic performance of communities based on their proximity to Jesuit missions established and subsequently closed hundreds of years ago.  The Jesuits emphasized literacy and job training.  The missions were established in locations that were not particularly desirable in terms of population density, soil fertility, climate, or access to transportation and trade, because Franciscans who arrived earlier claimed the best locations for their missions.  The Jesuits were expelled from the Spanish Empire in 1767, at which point Jesuit missions shut down.

The closer communities were to Jesuit mission, the higher subsequent education levels and earnings, and the quicker communities adopted new technologies.  These benefits persisted for centuries.  The benefits are similar across national boundaries and do not appear to be due to institutional or legal differences.

Proximity to Franciscan missions, which emphasized healthcare and anti-poverty efforts rather than education, did not provide similar benefits.

Felipe Valencia Caicedo; The Mission: Human Capital Transmission, Economic Persistence, and Culture in South America, The Quarterly Journal of Economics, Volume 134, Issue 1, 1 February 2019, Pages 507–556, https://doi-org.libproxy1.usc.edu/10.1093/qje/qjy024

This article examines the long-term consequences of a historical human capital intervention. The Jesuit order founded religious missions in 1609 among the Guaraní, in modern-day Argentina, Brazil, and Paraguay. Before their expulsion in 1767, missionaries instructed indigenous inhabitants in reading, writing, and various crafts. Using archival records, as well as data at the individual and municipal level, I show that in areas of former Jesuit presence—within the Guaraní area—educational attainment was higher and remains so (by 10%–15%) 250 years later. These educational differences have also translated into incomes that are 10% higher today. The identification of the positive effect of the Guaraní Jesuit missions emerges after comparing them with abandoned Jesuit missions and neighboring Franciscan Guaraní missions. The enduring effects observed are consistent with transmission mechanisms of structural transformation, occupational specialization, and technology adoption in agriculture.

The Washington Post has provided a good summary.

In Memoriam: Stephen J. Ellmann (1951-2019)

I was very sorry to learn of the passing of Professor Ellmann, a longtime member of the New York Law School faculty, and a leader in clinical legal education and an expert on the law of human rights and South Africa in particular.  There is a lovely tribute from the NYLS Dean here and an obituary here.  I had never met Professor Ellmann, but had corresponded with him over the years, and we had an instructive debate (instructive for me certainly) about experiential education here.

(Thanks to Robert Condlin for the pointer.)