For this episode, we talked about a WIDE ARRAY of topics! This was a fast moving show and is well worth a listen or even two. Enjoy!
Tyler Cowen is Holbert L. Harris Chair of Economics at George Mason University and serves as chairman and faculty director of the Mercatus Center at George Mason University. With colleague Alex Tabarrok, Cowen is coauthor of the popular economics blog Marginal Revolution and cofounder of the online educational platform Marginal Revolution University. Cowen’s latest books are Big Business: A Love Letter to an American Antihero, and Stubborn Attachments: A Vision for a Society of Free, Prosperous, and Responsible Individuals. His research has been published in the American Economic Review, the Journal of Political Economy, Ethics, and Philosophy and Public Affairs. Cowen is host of Conversations with Tyler, a popular podcast series (and one of our favorites) featuring today's most underrated thinkers in wide-ranging explorations of their work, the world, and everything in between. Foreign Policy named Cowen as one of 2011’s “Top 100 Global Thinkers,” and an Economist survey counted him as one of the most influential economists of the last decade. Cowen graduated from George Mason University with a BS in economics and received his PhD in economics from Harvard University.
Ed’s Questions
Tell us what you do as the director of the Mercatus Center.
What about the Center for the Study of Policy Choice which you are on the faculty, that has to do with public choice theory, right? (Our show on Public Choice Theory.)
In a recent column, in the next twenty you ask what is the most unexpected next transformative technology, you say the automobile, but not driverless cars. Can you unpack that for me?
By 2023, according to one analyst believes that one in five cars will be a subscription car, do you think that will be a factor?
A lot of small towns get 80% of their budget from speeding tickets. What will be the impact on some of those places?
Another column you wrote in April, where you laid out your best argument for a gold standard. Is it possible that technology like Bitcoin or cryptocurrency might help overcome that government interference problem?
You haven’t written about Bitcoin in nearly a year; it has lost some of its luster don’t you think?
Maybe the best use of blockchain is smart contracts that automatically execute, like brokerage statements based on a percentage of assets, which can be automatically verified by blockchain.
I saw a chart today and I thought of you, it said the first time ever there are now more people in the world over 65 years old than people younger than 5 years old. How much of a concern do you think that is from an economic perspective, or is it one at all?
We are most productive in our 30s, as Charles Murray pointed out in his book, Human Accomplishment.
“I’m going to turn the tables on Tyler and do something with his permission he does on his show, Conversations with Tyler, he asks his guests a list of random things and to state whether they are underrated or overrated, are you ready Tyler? Here we go:”
Behavioral economics
The threat of catastrophic climate change
Canadian literature and poetry
The Electoral College
The prospect of eliminating umpires from calling balls and strikes from major league baseball
The presidency of Donald Trump
In 2011, you wrote an interesting piece that I saw on foreignpolicy.com, Six Ideas for the Ash Heap of History:
Illegal Mexican immigration is a growing threat
Green energy will save us
Bank runs are a thing of the past
The Eurozone is pretty much for everyone in Europe
Bailouts should be incremental
Fiscal stimulus should be temporary, targeted, and timely
That’s a really good list, so far unheeded by most, what might you add to it today?
In another article you’ve written recently, you noted contrary to what Alexander Ocassio-Cortez and other concerned millennials believe, fear of climate change is justified, it is not, however, a reason not to have children, because those kids of yours are more likely to be part of the solution than the problem. Elaborate more on that.
Something you haven’t written about in a while, and I just wanted to see if you’ve updated your thinking on, what do you think about collegiate athletics? Will they continue to grow or will the whole economics be rethought?
How do you think football concussions will impact the sport?
What are you working on now?
Check out Tyler’s newest book!
We referenced this book several times during the interview.
Ron’s Questions
I’ve been reading your books for quite a while, and one I found interesting is Create Your Own Economy: The Path to Prosperity In a Disordered World, published in 2009. One of things you say in there is “forget that you saw the movie Rain Man, then you list all the people throughout history who we believe are on the autism spectrum:
Nobel laureate Vernon Smith
Charles Darwin
Thomas Edison
Albert Einstein
Isaac Newton
Vincent van Gogh
Thomas Jefferson
Alan Turing
Steven Spielberg
Bill Gates
Adam Smith
Obviously autism has been around for a long time. What makes their contributions different now? Does technology like the world wide web help?
There’s a lot written about how our brains can’t effectively multitask. You have a counterintuitive response to this. You think multitasking serves a useful purpose. Can you explain that?
You point out also that Adam Smith’s pin factory is a parable of autism. When you perform a repetitive task it can be rather than boring and alienating according to both Karl Marx and Adam Smith but you think it’s more a benefit than a cost, why is that?
You wrote that most education requires the physical presence of other human beings—education as theater. Do you think traditional brick and mortar colleges will be around 100 years from now, not displaced by MOOCs (Massive Open Online Courses)?
What do you think about Bryan Caplan’s argument in The Case Against Education about the signaling vs. human capital effects of higher education?
There is something about being with other people versus online when it comes to education.
Another thing you mention, which is just fascinating, there are plenty of studies that measure education’s ROI, but what are they comparing education to? No one has compared modern education to a placebo. If you could, what might that study look like?
Your book from last year, which I just loved is Stubborn Attachments: A vision for a society of free, prosperous, and responsible individuals, you write, “We need to develop a tougher, more dedicated, and indeed a more stubborn attachment to prosperity and freedom.” Why is that?
You also wrote that you hold pluralism as a core moral intuition. What’s good about human life can’t be boiled down to any single value—pluralist theories are more plausible. Do you think capitalism is too materialistic, or defenders of free markets take a too materialistic view, or is it also spiritual, allowing for a more pluralistic good life?
We’ve pulled roughly 1 billion people out of bone-crushing poverty in the past decade-and-half or so, do you think we take wealth for granted because it’s all around us, there’s so much angst among young people but yet they live in one of the most prosperous times ever in this history of civilization?
You propose a Wealth Plus measure: GDP + leisure time, household production, and environmental amenities. We know GDP is a flawed measure because when a sheep is born per capita GDP rises, but when a human is born, it goes down. Can you explain your Wealth Plus concept?
The other thing you are saying is that committing to growth is creating a better future. I’m glad our forbearers did that. Do you think there’s too much focus on alleviating poverty versus creating wealth, especially among developmental economists, or international organizations such as the World Bank?
Do you think the best way to fight poverty is to create wealth?
Just before we take a break, do you think China will grow old before it gets rich, is there some truth to that cliché?
In Stubborn Attachments you discuss happiness and wealth, and survey data on happiness, you pointed out: “Happiness gains don’t dissipate through envy. Better to envy your neighbor’s Mercedes than his horse and buggy. Better still, his supersonic transport.” Is envy a problem? Is that why we see the graduated income tax rates, and “soak the rich” is it just envy?
Is there a link between happiness income, only up to a point?
You also pointed out that the measurement data can’t capture the gains of longer life expectancy since you can’t poll the dead.
Tell us about your latest book, Big Business: A love Letter to an American Anti-Hero, because there’s a lot of negative press about big business, and you’re actually writing a love letter to them?
Do you worry that big business is becoming too concentrated (The Economist loves to write about this over and over)?
I don’t know if you saw this, but Kevin D. Williamson of National Review wrote a review of your Big Business book (“Big Business: Tyler Cowen’s Compelling Case for Large Corporations”), he points out that “professor Cowen has a great talent for revealing truths that are right under our noses but oddly overlooked, such as: Large-scale corporate enterprises provide a great many jobs; relative to smaller firms, they typically pay their workers more and treat them better, invest more in research and development, are more productive and more innovative, and conduct their business at least as ethically.” On the more innovative, I think most people have the idea that small business are more innovative. Are big businesses really more innovative than small businesses?
Do any privacy issues concern you out of Silicon Valley, or are we just giving our data and privacy away?
Do you think what the EU has done with the GDPR regulations is that the right approach?
As an economist, what would you like to see changed in USA macro, or federal, economic policy?
What would you like to replace the current tax system with?
What would you like to see on immigration?
Do you buy any of the research that illegal immigrants lower the wages of low-skilled workers?
What would you like to see in health care?
What would you do with Federal Drug Administration?
