Lots of discussion, but mainly about capitalism, trade, and socialism. The fact is that the economic advantage of college graduates in the US over high school graduates and those with lesser education has risen sharply, not fallen, for the past 30 years or so. There is no evidence that the growth of China in international trade has reduced that advantage, nor has its growth increased the unemployment rate for the less skilled or more skilled.
But the main contentious issue I raised in my Comment is that the poor of New Orleans especially suffered in part because they have become too dependent on the government for support, and the government failed them. Several commentators and Posner in his response questioned that interpretation (I was even called a "racist" by a person obviously completely ignorant of my past writings and behavior). Someone asked for the evidence--a very appropriate question--and I wish we had more evidence on this question. However, evidence on something like a "culture of dependency" is mainly acquired from analyzing behavior, and I tried to do in an admittedly loose way in my Comment.
I do believe that the limited evidence and analysis do support my contention. Clearly, some people were too sick or weak to leave, but I do not believe they were anywhere near the majority, despite the many newspaper photos that highlighted them. One of the comments mentioned a poll that claims only about 25% of those who did not leave lacked a car or money. Since a car is not necessary--public transportation operated prior to the storm-and since the amount of money needed was minimal, these data, if accurate, hardly suggest that most of those who stayed could not leave.
The rest of those who stayed either underestimated the severity of the storm, despite various warnings on television and elsewhere- most owned television sets--or they believed they would be rescued by government actions. Both these groups fit under my criticism that an excessive dependence has developed among the poor (of all races and religions) on government help in emergencies that has replaced reliance on own initiatives. The Welfare Reform Act of the mid-1990's only slightly weakened this dependence on government.
It would take only a few dollars to have boarded a bus and rode out of the most vulnerable areas. To be sure, the very sick and mentally disturbed could not do that, but why did the vast majority of those who stayed not leave, if only in the expectation of being gone for a day or do if they did not fully believe the public warnings? There are several alternative ways to answer that question, but eventually I believe we will be forced to emphasize the government dependency interpretation.
Several comments echo Becker's attribution of partial responsibility for the casualties caused by Hurricane Katrina to the creation of a "culture of dependency" by modern social welfare legislation. That such legislation can create a culture of dependency is true, and is one of the reasons behind President Clinton's welfare reform--a measure that conservatives applaud; I certainly do. But that it was a factor in the botched evacuation and resulting deaths in New Orleans is speculative. Many of the casualties were to residents of hospitals and nursing homes; such casualties were not attributable to a culture of dependency. Nor, it seems to me, were the casualties to people who did not own cars, unless one believes that there would be no poor people if there were no social safety net. That seems unlikely. The fact that the social safety net is weaker in the United States than it is in Western Europe is one of the reasons that the poverty rate is higher in the United States than it is there. It is also one of the reasons that the United States has a more dynamic economy and lower unemployment, and is more attractive to immmigrants. But one must take the bad with the good, and the bad of a society such as ours in which there is real economic risk is a higher rate of poverty.
Another frequent comment was that there is no need for a federal role even in disasters that spill across state lines because, in the absence of such a role, states would form compacts to cooperate in providing emergency assistance; they would stock supplies, create a standby command staff, etc. Suppose all the states joined the compact; then we are speaking of another federal government, in effect, so what would have been gained? The nation experimented in the Articles of Confederation with government by agreement among the states, and the experiment failed. In economic terms, the transaction costs of contracts between states appear to be very high, judging from the infrequency of such contracts. I am curious whether these commenters think there is any role for a federal government.
What is a legitimate concern is the danger, if any level of government undertakes to provide emergency assistance, of subsidizing risky behavior, such as building in flood plains. That danger could be minimized by requiring that all such assistance be repaid by the recipient, unless indigent. This would encourage nonpoor people to buy insurance, avoid building in flood plains, and take other measures to protect themselves from catastrophic risks. More broadly, I believe that government assistance should always be based on need; the fact that a rich person sustains damage to his home in a catastrophic flood rather than in a flood caused by a stopped-up toilet is no reason for the government to compensate him.
Much of the debate over the response to Hurricane Katrina has centered on the question of the division of responsibilities among the different levels of government--federal, state, and local. Concern has been expressed that for the federal government to have played a more aggressive role, for example by taking command of all response efforts and perhaps placing them in the hands of the regular army (as distinct from the National Guard, which is state rather than federal although the President is authorized to "federalize" it in situations of war, insurrection, or civil disturbance and thereby place it under federal military command), would have violated the tenets of federalism and perhaps specific provisions of the Constitution allocating powers between federal and state (including local) government, and specific statutes such as the Posse Comitatus Act of 1878, which limits military participation in law enforcement.
Issues of federalism cannot be resolved solely by reference to economic criteria. The reason is that, the Revolution having been waged by states (the former British colonies) linked in a loose confederation, the Constitution, while tightening the federation, recognizes the states as quasi-sovereign entities. Even if it would be efficient to do without states and have as centralized a government as France has, this could not be done without amending the Constitution, and indeed perhaps without replacing it with a completely new Constitution adopted in a constitutional convention.
Nevertheless, it is of course possible to analyze the economizing principles of federalism, and that is what I shall try to do in this posting.
From an economic standpoint, federalism is a scheme of decentralized governance, designed to optimize the provision of government services. In the governmental as in the private business setting, there are disadvantages to a strictly hierarchical ("U-form"--unified or unitary), as distinct from a more loosely coupled or "horizontal," method of organization ("M-form"--multidivisional). With strict hierarchy, information flows from the bottom of the enterprise up to the top echelon of management, and commands flow back down based on decisions made at the top. Inevitably, information will be filtered and otherwise lost or garbled on its way up, and as a result the top managers will perforce base their decisions on information that is frequently incomplete or inaccurate; and likewise commands will tend to be misunderstood on their way down the successive links in the chain of command. The centralizing of decisionmaking power will reduce competition, diversity, and flexibility; mistaken decisions will be more costly because they will bind the entire enterprise; and mistakes will be frequent because the top managers will not be given a full array of alternatives to choose among because their subordinates will filter out most of the alternatives on the way up in order to spare the top managers from being overwhelmed by information.
The other side of this coin, which is illustrated by the regime that preceded the Constitution--namely the Articles of Confederation, which created a very loose-knit federation of the states to conduct the Revolutionary War, and the inadequacies of which led directly to the Constitution--is that the lack of a central authority can result in suboptimal performance. Each division of the firm (or state or other regional or local government in a federal system) will tend to ignore the effects of its actions on the other divisions; each will be reluctant both to incur costs that benefit the other divisions (external benefits) or to avoid imposing costs on the others (external costs). Centralization is a way of internalizing costs and benefits throughout the enterprise by coordinating the divisions and making sure they are pulling together.
Since there are both costs and benefits to centralization, we can expect that usually the best organization will be one that has elements of both central control and divisional autonomy--one that has some hierarchy but not too much, and divisions that are only semi-autonomous. And so we observe in our federal system as a result of the provisions of the Constitution and, in particular, their (loose) interpretation by the Supreme Court. The states are allowed a considerable degree of autonomy in matters of taxation and regulation (including licensure), administration of schools and prisons, highways and other infrastructure, criminal law enforcement, etc., but Congress, the Supreme Court, and the President have a considerable override power. Congress is empowered to regulate interstate and foreign commerce; and the Supreme Court, by interpretation of the commerce power, has forbidden the states to impose tariffs and other impediments to interstate trade and travel, even if Congress fails to act. Because the states have a degree of autonomy, they function, much as the divisions of a software or pharmaceutical firm would, as laboratories for (social) experimentation. Policies invented in one state, if successful, can be copied by others. Also, people can sort themselves between states in accordance with their preferences; the right to move to a different state supplements voting power in controlling the action of government officials.
In the case of response to emergencies, one of the factors I discussed earlier--the effect of hierarchy on information flows and command responses--figures prominently, along with (depending on the scale of the emergency) externalities. The officials closest to a problem have the best information and also can act most quickly on it. We wouldn't be well served by having (only) a Federal Fire Department, so that in the event of a local two-alarm blaze the local fire chief would have to inform Washington and get permission to fight the fire. This is the point made by those who believe that the Federal Emergency Management Agency, even under competent leadership, should not be in charge of emergency responses to catastrophes.
But not all catastrophes are local. What is more, given mobility of responders, it does not make sense for every locality to invest in achieving self-sufficiency in responding to an emergency, regardless of the scale of the emergency. Suppose, as in the case of Hurricane Katrina, that the catastrophe simultaneously engulfs a large number of cities and towns in several states. Insofar as a coordinated response is optimal, and given transaction costs, which are especially high in an emergency situation, it doesn't make much sense to leave the response to state and local governments. Each state will seek to optimize its response to the damage caused it, and each locality to the damage caused that locality, disregarding the costs and benefits of its actions to the other states and localities. Moreover, as in a military situation in which one doesn't know where the enemy will attack, an effective response to an emergency requires the maintenance of reserves that can be deployed to the threatened spot, and those reserves have to be held and controlled centrally.
I conclude that while state and local government can and should be given exclusive responsibility for responding to run-of-the-mill local emergencies, the federal government should have standby responsibility for regional and (of course) national emergencies, as well as for emergencies that, as in the case of the flooding of New Orleans as a result of Katrina, wreak destruction on a scale that it would not have been efficient for the local government to prepare to meet. If you tell a city that it will receive no assistance in the event of a disaster, however great, it will overinvest in preparing to respond to disaster. Suppose for the sake of simplicity that the country has only two cities, that the cost of responding to an average disaster is 1 and to a cataclysm is 20, but that the probability that there would be two cataclysms at the same time is close to zero. Then if the federal government refuses to assist in local disasters, no matter how destructive, the two cities may incur a total cost of prevention of 40, whereas if the government invests in providing the necessary backup capability, the total cost of prevention will fall to 22 (1 + 1 + 20).
If this analysis is correct, then it was the federal government's responsibility to prepare to assist in an emergency of the scale of Hurricane Katrina. Such preparations would have been consistent with an optimal allocation of responsibilities between central and local government.
Posner gives good arguments why the federal government has important advantages in fighting emergencies, like the recent devastating hurricanes, that wreak havoc over a broad area that involves several cities and states. But bigger and centralized governments are also more bureaucratic, and respond slowly and erratically. Surely, the local government of New York City responded faster to the 9/11 terrorist attack than did the Federal government, even though New York’s response could also be criticized.
None of the governments responded quickly or effectively during the Katrina emergency, even ignoring the lack of preparation for the overwhelming of the New Orleans levee system by a powerful hurricane. Fortunately, since there was advance notice of Katrina’s destructive path, most of the vulnerable population evacuated their homes and businesses, and took other protective measures.
While I agree with Posner's general discussion of the different advantages and disadvantages of local and centralized authority, I still have a strong preference toward decentralized authority whenever that is possible. One reason is that local governments have a better feel for the special needs of its own population than a distant central authority can ever have.
A second important consideration is that individuals can move from one locality or state to another in search of better schools and other public services. This is an enormous advantage that can never be duplicated when power and decision-making are centralized. Competition among states and cities within a country puts considerable pressure on lagging state and local governments because people vote with their feet. They move where there are education and other services that better meet their needs.
Unfortunately, this type of competition works well only for individuals and families that are reasonably well informed about alternatives elsewhere, and who have the resources and inner energy to take the large and risky step of moving to a possibly better and often distant location. Most richer and better-educated persons can do this, but many studies demonstrate that poorly educated persons are far less likely to move across cities and states than are the more highly educated.
The population that remained in New Orleans during Katrina and who suffered the most had low incomes and education. This is not surprising since the low educated, as I just indicated, are usually less likely to move to take advantage of better opportunities elsewhere. Many do not own cars, and have to take public transportation, and they must find places to go. But without minimizing the importance of these considerations I want to emphasize another factor at work in the Katrina episode that contributed to the particularly heavy suffering of persons at the bottom end of the income and education distribution.
Governments at all levels-federal, state, and local-simply failed to take decisive and appropriate actions to meet the emergency brought on by Katrina. So families were mainly left to their own devices, and most of them had enough initiative to take as effective action as was possible. Of course, they could not do everything since their homes and shops were in place and often had to be abandoned.
The poor were hurt most by the government's failure partly for the reasons just indicated, and partly because they have become heavily dependent on governments to take care of them. This "dependency culture" created and nurtured perhaps unintentionally by welfare, Medicaid, and other government programs saps initiative and energy, and greatly weakens the habit of making one's own decisions. Dependency on government is especially devastating in serious emergencies, such as that caused by Katrina, when governments fail to take quick and appropriate actions.
It may be best to give the Federal government responsibility for meeting emergencies that cast a wide net over a large area encompassing many localities and states. But each emergency is somewhat different, and it is hard to believe that even after large and numerous investigations of each failure, a large bureaucracy like the Federal government is likely to take fast, effective, and decisive actions.
This is one important and usually overlooked reason to reform transfer programs and legislation to help the poor so that they have much greater responsibility in organizing and managing their lives. They need to be induced to look for private housing as well as jobs, and to be held responsible for bad decisions rather than being excused because they are "victims". Such changes in these programs for the poor will probably not make governmental responses to emergencies any better. Yet they could significantly reduce the enormous damage done from catastrophic events to families who can least afford further losses. These families will respond quicker and more successfully to catastrophes if they are more accustomed to taking care of themselves.
I agree that population density is an important variable. I did not single density out because population level and density are necessarily strongly correlated in an overall sense. But to be sure, cities have been more productive than rural areas in part because they are more densely populated. In a human capital specialization model, density reduces the cost of coordinating different specialists.
Obviously, fossil fuels have been used up during the past 100 years as population and industrialization have grown rapidly in the world. But new sources of old fuels and new fuels continued to be discovered, so that known reserves of fossil fuels are far greater now than 60 years ago. So given this history, why is it prudent to assume that such progress will not continue in the future? On the contrary, for the reasons I gave, I believe the prudent assumption is that progress will continue, although the precise directions of the progress cannot be foresee at present. But the numerous possibilities include harnessing solar power, hydrogen fuel cells, greater use of nuclear power, more efficient wind power, and so on. A larger population gives greater incentives to innovate along these and other lines, which is one of the main points of my disucssion.
I certainly do not believe that poor countries have been held back from progress because of low IQ’s. This belief is not based on political correctness but evidence. Prior to 1980, an IQ interpretation applied to the poverty of India and China-now 37 % of world’s population-would have been totally wrong about their prospects from introducing more sensible economic policies. The same is true of Africa, and other countries that continue poor: bad policies are by far the overwhelming determinant of their poverty. I do not believe that any country-wide differences in ability- still not documented--are important explanations of country differences in poverty.
I know Smith's chapters on specialization very well and I do not believe the reader who claims I misquoted Smith can back up that claim. Can you?
India did begin its progress in the late 1980's because economic reforms began at that time. But India's economy really began to take off after the more significant reforms introduced in the early 1990's by Dr. Singh, the former Finance Minister, and the present Prime Minister.
I did not explicitly mention the Solow growth model, although it is an important achievement. But implicitly I am criticizing the population assumption in that model because it does not distinguish mortality from fertility, and especially because it assumes constant returns to population. Solow growth theory does not recognize the increasing returns to population that more modern growth analysis considers to be important.
Of course, I do believe that medical research and education are important in understanding growth and increased life expectancy. I have worked on both these questions for a long time. However, I am not convinced that 90-100 years is an upper limit to human populations. All the genetic and other evidence of the past 20 years suggests, although it does not prove, that within several decades a significant number of persons may be living reasonably healthy lives when they are past 100 years old.
In a previous entry I gave an optimistic view about the possibilities of sustainable growth, while Posner was more pessimistic. He argued in part that continuing population growth in the world might make economic progress not sustainable for many nations. Since I am positive about the effects of larger population, we decided to return to population for this week’s discussion.
Japan is a good starting point since its population fell in 2004 as a result of several decades of low birth rates and almost no net immigration. Is Japan or the rest of the world better off because its population fell rather than continued to increase? Without large net immigration, countries with about half the world's population, including essentially all of Europe, China, Japan, and many other Asian nations, will experience declines in population during the next decade or so because they have birth rates that are substantially below replacement levels. Will these countries be better off with lower population, and would the world benefit if their populations declined? I believe the answer is no, that particularly in modern knowledge-based economies, on balance population growth helps rather than hurts income growth and general welfare.
Most of the worry about negative effects of population growth is based directly or indirectly on the ideas of Thomas Malthus that were first expressed in a pamphlet published in 1798. What is ignored in the modern neoMalthusian discussions is that there is an enormous difference between the effects of larger population on income per person in the traditional rural economy of Malthus' time, and its effects in a modern knowledge-based economy exemplified by the United States, Western Europe, and Japan. Higher population may reduce per capita income in traditional agriculture because of diminishing returns to more farm workers (although see my discussion of Africa at the end), but it has the opposite effect in a modern economy. The reason for this reversal from the Malthusian fear of population is that the production of knowledge is generally subject to increasing, not decreasing, returns; that is, larger populations stimulate greater investments in knowledge that tend to raise per capita welfare.
For example in the case of new drugs, manufacturers have greater incentive to invest in discovering treatments for common rather than rare diseases since by definition common diseases have larger markets. More generally, expenditures on innovations tend to be more profitable as population and the total demand for new products rises since it is then more possible to recoup the often very large initial costs of developing the products. Drug producers and other innovators charge much more than the cost of producing each unit in order to recoup these development costs.
Adam Smith starts out his great book The Wealth of Nations with a discussion of why the division of labor, and hence economic progress, is limited by the extent of the market. By this he meant that the incentive to specialize on more narrow skills is larger when the market for these skills is bigger. He develops this theme with a famous discussion of specialization in a pin factory. Since the number of sellers and buyers who interact together determines market size, the Smith analysis would also say that economic progress is greater, given per capita incomes, when population is larger.
In a world with six billion people, there might seem to be little room for additional specialization as population rises further. But great possibilities are still available for further gains from international specialization when population grows, as illustrated by the large and generally beneficial effects on the world economy as the large populations of China and India have entered into the world trading system. As world population grows further, the degree of international specialization across nations will increase further in ways that are hard to predict in advance.
Another frequently claimed benefit of larger populations is that they produce geniuses like Einstein and Darwin, and other imaginative innovators, and that the discoveries of these rare individuals benefit everyone. I will not stress this effect since I agree with Posner in his comment on sustainable development that the number of evil geniuses, such as Hitler and Stalin, is also greater in larger populations, and their evil deeds also affect more or less everyone.
Neo-Malthusians who fear larger populations typically stress the effects on pollution and on the demand for non-renewable resources, like oil and natural gas. Clearly, the demand for fossil fuels and other non--enewable resources grows with population as well as with economic development. However, during the past 150 years, the real price of fossil fuels like coal and oil fell rather than increased as world population exploded, and more and more economies prospered. More efficient use of fossil fuels and discoveries of new reserves of these fuels, and innovations that produce alternate sources of energy, like nuclear power, explain why prices of fossil fuels did not rise along with population and industrialization. Larger populations stimulated the search for new resources and new sources of energy because they increased the market for these discoveries (for the reasons I gave earlier about the positive effect of larger populations on incentives to innovate). That is, while larger populations may use more fossil fuels, they also stimulate the effective supply of these fuels and of substitutes.
Obviously, given per capita incomes, larger populations also tend to produce greater pollution both locally and globally as more cars are driven, industrial output rises, and more homes burn fuels. It is well documented that local pollution eventually begins to fall rapidly as countries develop and their populations increase because of new discoveries that reduce pollution, and also because more of the incomes of richer countries is spent on controlling the output of pollutants.
I believe the same will happen to the risk from global warming. Not only will countries impose greater restrictions on output of greenhouse gases, as in the emission trading system of the European Union, but probably even more important will be the development of new ways to absorb C02 and other gases from the atmosphere. For example, Wally Broecker, Professor of Geochemistry at Columbia University and a major researcher on the oceans and abrupt climate change, believes that it will be possible before long to effectively capture and store the CO2 in the atmosphere in cost-effective ways. If that happens the growth of CO2 in the atmosphere can be greatly slowed down and possibly even reversed.
Posner also worries in his comment on development about the possible negative effects of an aging population. I am concerned about that too, but a growing share of the elderly population is a consequence mainly not of population growth, but of low birth rates that produce a slowing down, not speeding up, of population growth. The countries with the largest share of the elderly, countries like Japan and Germany, have very low birth rates that are not offset by enough immigration of young people. So the most effective way to reduce the share of the elderly while still having increases in life expectancy is to encourage rather than discourage greater population growth either through greater immigration or higher fertility.
More traditional economies, like those found in sub-Sahara Africa, may still be subject to diminishing returns from greater population, although even here I have real doubts about the applicability of traditional Malthusian analysis. African populations have increased greatly during the past 25 years mainly because mortality has fallen substantially. This continent's population is expected to continue to grow rapidly even though fertility will continue to fall, especially as Aids is brought under greater control. If lower death rates mean better nutrition and better health, the productivity of each worker improves because they have more energy and stamina. The greater productivity of each worker could easily swamp any diminishing returns from greater labor input, so that per income per worker is likely to rise rather than fall as the number of workers increases due to better health.
Of course, the poorer nations of Africa and elsewhere need to have governments that pursue sensible and generally pro-growth policies rather than their tragic catering to various special interest groups at the expense of growth. As India dramatically has demonstrated, the main obstacle to economic progress is not population growth, but bad economic policies. Once India began to get its economic house in order- this started with the reforms of the early 1990’s- India's economy took off while its population was growing rapidly and birth rates were high. Africa’s growing population will not be an obstacle to greater economic progress if it moves more quickly to having freer economies, greater competition, and lower levels of corruption. Indeed, with greater economic development, a growing population becomes an asset to a region and to the world for all the reasons I have given.
Of course, it is possible that vast increases in the world's population to many times the present six billion persons may create serious problems. However, the forecasts are for no more than nine or ten billion persons by the year 2050, mainly because fertility falls sharply with economic development and increased education of women. I do believe that such an increase in population is far more likely to be a positive stimulus to the world's economic progress broadly defined than it is to retard such progress.
There is much in Becker's posting with which I agree, in particular that population growth will not cause us to run out of natural resources. I also agree that a combination of preventing carbon dioxide emissions from reaching the atmosphere and removing carbon dioxide from the atmosphere may eventually (though possibly at enormous cost, and possibly too late) solve the global-warming problem; this is an issue that I have addressed in my book on catastrophe.
And yes, increasing the extent of the market does permit greater specialization (hence lower costs and prices) and tends to increase the innovation rate by enabling the fixed costs of innovation to be spread further, although the extent of the market depends on incomes and not just on population. But innovation is a mixed blessing. It is like evolution (which in fact it resembles) in having no necessary relation to social welfare. The technologies of warfare are merely the most obvious example. The benefits of (for example) medical technology accrue mainly to the elderly, and by extending the life of the elderly advances in that technology increase their political heft, resulting in still more redistribution from young to old. Although historically the net social benefits of technological progress have been positive, there is no compelling theoretical reason to expect this always to be the case. The smallpox virus will be synthesized within five years, at which point the destructive capabilities of terrorists will jump by orders of magnitude.
Becker argues that the effect of medical technology in keeping people alive longer can be offset by population growth. That is true if the growth results from a high birthrate. But there are no prospects for even a replacement-level birthrate in Europe and Japan, and I do not think Becker would support efforts to subsidize births in order to offset the growth in the relative size of the elderly population. It seems that the only way in which these countries can sustain a youthful population is by immigration, which seems no longer to be an attractive option for Europe and has never been one for the insular Japanese.
I think Becker himself is at least slightly ambivalent about the effects of an ever-growing world population, because he seems to approve of the effect of female education in lowering the birth rate. And I wonder whether he actually thinks that it's a mistake for China to limit the growth of its population. I do not mean that the "one child" policy is sensible; but I do think it is plausible that the net effect on social welfare of a greater population in that country would be negative (why else is the Chinese government enforcing such an unpopular policy?). Finally, as I discuss in my book and mentioned in passing in my posting on sustainable growth, there is much cause to worry that depletion of species--a consequence in large part of human population growth--will have long-term negative effects on human welfare.
A neglected negative effect of population growth is on political governance. There seem to be strong diseconomies of scale in government. Increases in population, and concomitant increases in economic activity, crime, demand for medical services, and so forth make the job of government more difficult. What seems to be an incipient crisis of competence in the U.S. government may be at least distantly related to the doubling of the U.S. population since 1948.
Let me respond briefly to some interesting comments. The main point of my comment on Posner was that I would leave the decisions about admission of men and women to universities and professional schools. If they want to take many women even though they are more likely to drop out, I do not believe we know enough to challenge that decision. I suggested that schools may be taking into account the advantages of co-education, the contribution of female alumni, and other considerations. So the critic who said I only looked at earnings did not get my main point-I do not feel enough is known about the total contributions of men and women, monetary and non-monetary, to be able to tell professional schools what criteria they should use.
I only suggested the use of "profiling" through using sex as a relevant variable. Perhaps one can analyze within the group of say female applicants and try to figure out which ones would drop out. But that is I agree too difficult, and in my approach not even necessary.
On the mainly different issue raised by one commentator, I do believe that colleges and schools should try to "max out"in their admission policies. But by that I do not mean they should try to maximize tuition revenue since they are clearly interested in the quality of students, their subsequent achievements, etc. However, they should engage in even greater price discrimination than they do, and not have a "needs blind" admissions policy since tuition revenue is one of the relevant variables, especially for private universities. After all, most of them, alas including the University of Chicago, do not have an endowment that is anywhere near Harvard's.
I cannot do justice to 135 comments! I have learned a great deal from them, but I will have to be highly selective in responding.
Let me make clear at the outset that it was not my intention to "lash out at women (or men) who take time off to raise their kids," or to turn men or women into wage slaves, discourage women from working or having children, or, for that matter, dictate admissions policies. Some comments suggest that I want women to stay home, others that I want them to work. I merely want them to make an unbiased choice. The point of my posting was to make the economic point that rationing scarce places in elite professional schools on the basis of grade point average and performance on standardized tests may result in turning away applicants who might be more productive because they would have longer working careers.
One comment adds a reason for my concern that I had not thought of, which is that admission to public professional schools, some of them elite (such as the law schools of Berkeley, Virginia, and the University of Michigan), is subsidized by state taxpayers. It is odd to subsidize the professional education of people who are not going to make a full commitment to the profession at the expense of people who would. Do taxpayers know that this is how their tax dollars are being spent?
The point to be emphasized is that, given scarcity of places, admitting X means rejecting Y; if Y, though a slightly worse student than X, is going to spend much more time in the workforce, what exactly is the good reason for admitting X rather than Y?
Now one interesting answer suggested by a commenter is that there is a market demand, on the part of law firms and other employers of lawyers (and other professionals), for more women; and if there is a high drop-out rate of women, law schools may have to adopt admission policies that assure that half or more of the students are female so that after drop-out there will be enough women left in the professional workforce to satisfy the market demand.
Similarly, if public interest law is assumed to confer net social benefits, and women are disproportionately drawn to public interest work (as several comments suggested), then, again given the drop-out factor, there is an argument for admissions policies that attract women.
A number of the comments complain about working conditions in law and other professions--about employer demands that make it difficult for women to work and have children. But there are many law jobs, for example in government, but also in many corporate legal departments, that are not as demanding as jobs in high-pressure law firms; my guess (and it is only a guess) is that even in those lighter jobs, there is a higher female than male drop-out rate.
One of my female former law clerks suggested that the logic of my position requires me to institute a system of penalties and rewards to make sure that I just hire women who are going to devote their lives to the law. But I am too selfish for that. I want to hire the very best applicants, regardless of the likely duration of their legal careers, and, therefore, regardless of whether they are male or female. But I have made a contract with this former clerk whereby I will buy her dinner once a year for as long as she remains in the profession, and if she leaves she will then buy me dinner once a year unless and until she returns to full-time legal work. Because of the difference in our life expectancies, this is a very disadvantageous contract from my standpoint. I hope that those commenters who took sharp exception to my posting will feel that I have been adequately as well as justly punished.
