About barefooteconomist

Follow @ErwinKnippenber

Unemployed College Majors: Engineering vs. English

In trying to understand what drives the Occupy Wall Street protesters, certain commentators have resorted to stereotyping: casting them as unemployed youth with liberal arts degrees, disappointed that their degree in puppetry or medieval French didn’t pay off. According to this rhetoric, there’s plenty of demand for engineers and scientists, students are just too stupid or lazy to specialize in these fields. Setting aside the condescending tone, how true is this claim?

Analyzing data on unemployment by major, as featured in the Wall Street Journal, we find that it’s a half-truth, up for interpretation. In terms of unemployment rates alone, technical fields seem to have no advantage over more generalist education. Rather, while some science or engineering majors are in high demand and others face up to 15-20% unemployment, the liberal arts majors seem to occupy a happy medium around 6-7% unemployment. But if we dig a little deeper and look at expected returns in terms of wage, then the advantages of a mathematically oriented major become evident. Readers of this blog might appreciate that majoring in Military Technologies provides one of the highest returns despite a 10.9% unemployment rate. Sometimes it makes sense to take a risk and hold out for your dream job, especially when you’re specialized.

For those of you curious to see the numbers, I included the full table of data here, highlighting specific majors I refer to in the text.

Continue reading

The Sea is Dead, Long Live the Sea

It seemed a mirage up until I dove into it, Aydarkul, a lake in the middle of the desert. We had driven for hours through the Kyzyl Kum, an area so arid even camels struggle to find sustenance. Then between two sand dunes, it winked at us, a blue body of water under a cloudless blue sky. A lake teeming with fish, migratory birds and even a few people, come to enjoy nature’s bounty. Meanwhile, 400 miles to the northeast, its predecessor the Aral sea lies in its death throes, with only a sad stone memorial standing witness to its former prosperity.

As new life emerges in this wasteland, perhaps we should stop trying to save the Aral Sea by pouring more concrete and digging more canals. Rather, lets take advantage of nature’s resilience and try not to make the same mistakes again.

The locals claim, and research confirms, that like the Salton sea lake Aydarkul resulted from an accident. In the 60s, soviets build a dam on the Syr Darya, and when floods cam they diverted the water into the desert. Fed by mountain streams and the occasional flood, the lake has grown ever since, a flourishing self-sustaining eco-system. The Syr Darya once fed the Aral Sea, and it’s no coincidence that as one lake shrunk, the other grew. Furthermore, it seems the Aral Sea itself is an artificial construct whose shores have fluctuated widely in response to human intervention. A dam build in the 7th century diverted the Syr Darya away from the Caspian Sea onto a new course, creating the Aral sea.

There are drowned trees underwater, b/c the Soviets tried to plant a forest before they made a lake.
Where all the water went: Lake Aydarkul

Continue reading

Pathological Resistance

Gaddafi Diehards Suffering from Stockholm Syndrome

“Patriotism is the virtue of the vicious”  Oscar Wilde

The cheering throngs in Tripoli have dispersed, their celebrations marred by uncertainty, sniper-fire and occasional mortar-rounds. Though Gaddafi remains at large, militarily his cause is obviously lost. He has few weapons, no supplies and his few remaining soldiers lack any sort of central command structure to coordinate their actions.

Historically, when a country is clearly losing a war its people tend to topple the existing regime and broker a peace. Napoleon’s generals mutinied when France was invaded. Kaizer Wilhem and Tzar Nicholas II lost their thrones with the enemy still far from their gates. Argentina’s military junta got pushed out after their defeat in the Falklands war. Why then in Gaddafi’s case do some of his loyalists seem bent on fighting to the bitter end?

If we look at the three rational reasons for resistance, greed, tribal loyalty and fear, they seem increasingly insufficient. Rather, like Hitler before him, after holding his country hostage for over 40 years Gaddafi is benefiting from the mother of all Stockholm syndromes.

Continue reading

How Private Security Contractors can Save Lives

 Lessons From a Tunisian Car Crash

I almost died a couple of days ago in a banal traffic accident. A car crossed in front of us on the highway, stalled, and we crashed into it going about 50-60 miles an hour. Fortunately, the driver controlled the vehicle as it ground to a halt, allowing all four of us to get out of there in one piece. She took most of the shock upon herself, suffering wounds on both her hands and a concussion.

Though personally affected, I have little broad insights to draw from the accident itself. It’s the aftermath that proved interesting, and particularly how involving a private security firm did and did not help.

Traffic accidents are one of the most frequent and obvious ‘Black Swans” for individuals; unexpected, low probability events that can change your life forever, even end it. World-wide, 3,500 people die on the roads every day, according to the WHO. It’s the 6th preventable cause of death worldwide, expected to bump up to 3rd by 2020. It’s a ‘disease’ that disproportionally targets the young: “Road crashes kill 260,000 children a year, injure about 10 million and are the leading cause of death among 10-19 year olds”. As with many such epidemics, the developing world suffers the most.

Deaths for road traffic accidents per 100,000 inhabitants in 2004.File:Road traffic accidents world map - Death - WHO2004.svg

source:http://www.who.int/entity/healthinfo/global_burden_disease/gbddeathdalycountryestimates2004.xls

Continue reading

Facts Falling Behind

“A true Poem is the Daily Newspaper” – Walt Whitman,

With those words the poet captured the American realism movement, an embrace of facts over fiction. The movement faded around 1910, but a century later we face its anti-thesis, a general rejection of fact.

It struck me when my longtime mentor asked me about a phenomenon he’d observed in recent years: candidates for the Rhodes, Mitchell, Fulbright and other such prestigious scholarships remain ignorant of the most basic facts about the programs they apply to, such as amount of funding or even the subject of study. They don’t bother to obtain this simple, easily accessible yet crucial information.

This phenomenon is not only anecdotal. As the country clashes over the hovering debt ceiling, the fact is that 45% of Americans admit that they don’t understand the issue, according to the Pew Research Center;  but 75% of Americans claim that the debt “is a major problem the country must address now”. This means that at least 20% of Americans, say 60 million people, are knowingly sticking their heads in the sand! Continue reading

Black Swans in America

“The use of traveling is to regulate imagination by reality, and instead of thinking how things may be, to see them as they are.” – Samuel Johnson,

I just spend a month journeying down America’s main-streets, from New York to LA on a bumpy, crowded and occasionally smelly greyhound bus. On my many detours I wandered the streets, getting the feel for these cities through the soles of my feet. Traveling alone proved daunting, but also an opportunity to meet with locals and fellow wanderers.

Such raw exposure taught me what newspapers and annual economic reports fail to show, the robustness of this country. This resilience allows it to survive and even thrive on Black Swans, the low probability high impact events Nassim Taleb warns about.

Continue reading