Posts by Keir Leslie
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Well, the question of what a year’s study in a field actually costs the university per student is somewhat tricky. (Because of accounting for centrally provided services, opportunity costs, non-linear costs etc.)
But yes, the fees paid are roughly half of what the government contributes per student. But that’s a bit too generalised, because different degrees get different government contributions. You can look at those here, and observe that per EFTS, you are looking at a 6K contribution from the gov’t for the arts/law/business/accountancy, and a 10K contribution for science/engineering.
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Who'd have guessed, after you make a speech that looks suspiciously like a leadership speech, coupled with some rather weird blogging, it's a hardly a surprise people tell you to pull your head in.
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The accountancy and law degrees are cheaper and easier to get and offer access to an employment market with many customers – a no-brainer on a personal level. The science and engineering degrees are harder to get and offer access to a smaller employment market and lower incomes. So, clearly, all sensible people should become lawyers and accountants. But this isn’t so good on the level of national economic development – and, crucially, it’s every bit as much of an artefact of the system you’ve chosen to distribute the public resources as, say, people choosing science degrees because there’s a 100% subsidy for the cost of science degrees.
Factually, this is not really true.
1 EFTS of Law is $5,243*; a year of bench science $5,743. But a BSc takes three years, and a LLB four. So in fact a BSc is about $5,000 cheaper than an LLB. (Except you have to add in (a) the cost of living for a year, which is probably around the 10K mark, and (b) the opportunity cost of that year, which is probably floating around the 30-40K mark. So I would imagine an LLB costs roughly 15k more ignoring opportunity cost, and maybe 50k more including it.) Roughly the same maths applies for anyone wishing to become a chartered accountant. While the EFTS are slightly cheaper, it is a four year degree. A BEng EFTS is $6,217, and the BEng is also four years, so that’s $4,000 more than an LLB or Accountancy.
While claims about relative difficulty of degrees are a minefield, I would note that both law and engineering have very high failure rates in first year. Science and accounting are both technical, math heavy subjects, but to become an accountant (obviously not the same as an accounting degree) you must do four years not three, and complete a professional qualification on top of that. (As in fact you must for law.)
So in fact no, law and accounting are not cheaper and easier than science or engineering. Possibly, law and accounting are cheaper and easier than engineering.
But it isn’t like engineers are badly paid! I would say that engineers tend to be paid as well, if not better, than lawyers or accountants.
And it isn’t an arbitrary fact that training engineers costs more. To make someone an engineer (or a scientist, for that matter) is intrinsically expensive — you must provides labs, materials, practical experience, etc. To make someone a lawyer or accountant, you must provide teachers and books. So it isn’t an artefact of the funding system; it is an artefact of the world. If you give a accountancy department and engineering department the same money, the accountancy department ought be able to produce more accountants than the eng department engineers.
Further, if in fact we have an undersupply of scientists, we ought see the wages paid to them rise, until it becomes an attractive career, and then the supply will increase until equilibrium is reached. Is there a reason this process shouldn’t occur? (And the reverse, of course, for lawyers or accountants.)
* All figures from the University of Canterbury for 2012, found here. I have assumed degrees are purely composed of the relevant efts, which isn’t in fact true. I would guess the effect would be to make all the degrees slightly cheaper, but not noticeably.
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Free market compared to, say, Russia. Or China. Or even India, I suspect, although that would be an interesting comparison.
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No, those people at NASA (&c, hi Lucy!) are engaged in science that is not expected to make a return on investment. If NASA was expected to make money, it would have to be one of the most useless investment vehicles ever.
Think Big, of course, was a major cause of the atrocious state of NZ's books in 84, and part of the reason the '80s were a horribly painful economic experience.
(I mean, if you talk to most economists, they will tell you that if you have to set up some way of organising an economy, a market is the best way to start. Some will then tell you should do other stuff to fix the flaws in the market, while others will tell you you can never meddle with it. But there are almost no economists who will tell you to start by centrally planning everything, for instance.)
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Look, if you want a government that runs an industrial policy based around the economic benefits of very far away rocks, you're more than welcome to it. But personally, that sounds so perfectly crackpot as to be a sterling example of why governments ought stay out of it.
Of course, it is very easy to point to examples of misguided government investment. Think Big, for instance. Or farm subsidies. And that is solely in New Zealand, a traditionally free market economy.
I am not against government intervention when there's actual evidence that what is going on is amenable to the government fixing things by the spending of money. And so I think that free tertiary education is a really really good policy, because it fixes a real problem in an economically sane manner.
I do not think think throwing more government monies specifically at the undergrad provision of STEM subjects is economically justified. (Because that is the specific argument before us.)
If you think that markets are a generally discarded economic theory you are more than welcome to tell the economists. As far as I can tell there are almost no reputable economists who reject the market as the basic economic structure. There are questions about the efficacy of certain kinds of market.
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But I can't see why truckloads of accountants ought be any more concerning than truckloads of traffic engineers.
The way you are using this public interest thing seems amorphous and ill-defined. I would like a lot more definition before I relied on it for any policy decisions.
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You have to be careful here. If you want to make an argument about the broader public interest that's all very well, but that's different from arguments about economic benefit. And really I am pretty unconvinced of an argument that a software engineer is of any greater specifically public benefit than a lawyer.
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Cherrypicking successful example of government spending is not an argument.
In particular, war-driven advances in technology are one of the worst advertisements for government investment in technology ever.
Of course, space is not a particularly non-commercial environment, and (hardly surprisingly) there are a crazy number of crazy US space fanatic libertarians who are just itching to get themselves into spaces and make money mining asteroids/He3 form the moon/wevs. And it isn't like human space exploration has, to date, been a very economic venture, and nor does it look like it ever will be.
The thing is, when someone says: we have insufficient tradespeople, they are not really saying that. What they are saying is that tradespeople cost too much, and they would like the supply of tradespeople to be subsidised in order to bring that price down. Markets work. Not always, but in general.
And Bart isn't even saying that! He is basically arguing that we should make it cheaper to become a scientist or an engineer, on the grounds that the wages made by those graduates (i.e the value the market places on their skills) is too low to make it economic to become one at the moment. This is the most precisely backward reading of the market's signals possible.
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What could disprove evolution? Well, the discovery of a human in the pre-cambrian. That's a thing that would disprove it.
Anyway you want to make things scientific by popperian falsification-ism, and that's a rubbish game, so let's not play it.