Practice Good Theory

In " The Great Degeneration ", Niall Ferguson argues that the west is stagnating because of broken "institutions". The cause of Ascendancy: Ferguson rejects Max Weber's "cultural" explanation of a Protestant-driven industrial revolution. After all, the same root "culture" ended up in a very different East and West Germany or North and South Korea. While Jared Diamond's "geography" might explain why Eurasia was wealthier than the Americas, it does not quite explain the ascendancy of Western Europe. Finally, iIf genes are crucial, how to account for the gap between East and West German IQ scores, and how to explain why Eastern genes did relatively well until the last few centuries? The crucial factor, says Ferguson, is the socio-political institutions adopted in some countries: property rights, rule of law, and private voluntary organizations. The role of Philosophy:  He is right, but this explanation is incomplete: why d...

If you follow economic news, you know that the "participation rate" (the % of people who say they are actually looking for a job) has been falling in the U.S. [See the blue line in the chart.] [Source: the great Calculated Risk blog .] The overall participation rate was expected to drop as the "baby boom" generation retires. That's not the cause though. As this chart shows, the participation rate within the 25-54 year group began to fall after the dot.com bust, flattened out, and then began to fall again after the housing bust. This age group does not go back to college in huge numbers. Some of them were probably part of the huge increase in "disability" rolls . Others probably stay home with a spouse to support them, having decided to wait things out until the economy improves. Changes, by Age and Sex: How has the housing bust impacted participation rates across age and sex? For example, people around 65 years old have a lower participation r...