his findings argue against the need to create strong incentives to succeed. If some people are genetically oriented toward success, then they do not need lower tax rates to spur them on. Such people would be expected to succeed regardless. The ideal society implicit in Clark’s view is one in which the role of government is to ameliorate, rather than attempt to fix, the unequal distribution of incomes.
The book I am reviewing is The Son also Rises, in which Clark argues that social status is highly heritable everywhere in spite of many differences in institutional rules. I spend a lot of the review talking about the statistical basis for Clark’s work.
How is persistence across generations evidence for a genetic mechanism instead of a social one? For example, maybe having high-status relatives is as advantageous as having high-status parents. But maybe the mechanism doesn’t really matter for Clark’s argument.
Does he discuss how this thesis fits with his previous book? As I recall, one of the arguments he made in A Farewell to Alms (and I read it 5-6 years ago now, so maybe I’m getting this wrong) was that the Industrial Revolution was a result of a somewhat unique set of pretty Malthusian conditions in Europe which led to the upper classes outbreeding the lower classes, but also with a high degree of downward social mobility for the upper class, leading, over several centuries, to a change in the genetic makeup of Europeans which facilitated the IR and gave us our wonderfully high living standards of today.
That would seem to contradict his latest idea of the constancy of social mobility across time and nations, unless I’m missing something.
Not necessarily. Suppose you’re an earl with 3 kids. Under English inheritence rules, your oldest son follows you as an earl. Your younger son is a commoner (though probably gifted with a courtesy title, such as “the Honorable”). Your daughter is married off and takes the status of her husband.
So your family’s high status is maintained, even while excess offspring fall into lower social classes.
If memory serves, Britain was somewhat of an exception; elsewhere there seems to have been a notion that all of an aristocrat’s offspring (or all his male offspring) inherited aristocratic status.
“So your family’s high status is maintained, even while excess offspring fall into lower social classes.”
Okay, that sounds reasonable enough. But Clark seems to be suggesting that this model of social mobility exists everywhere and it doesn’t vary much in response to changes in laws or social norms, even over the long term. I’m not blank slater, but that’s still seems like a pretty big pill to swallow. And I still think it’s pokes a pretty big hole in his argument about the industrial revolution.
Think of it this way: 2007 Clark is saying downward social mobility played a big role in bringing about the industrial revolution. 2014 Clark is saying social mobility is pretty constant over time. Those two statements seem to be in tension to me. But like I said before, I could be misremembering his earlier book and I haven’t read his newest book yet, so I could be entirely off base here.
No. Suppose you’re say a Swedish general in 1700 named Kollberg with land and serfs and many kroners in the bank and — of course — superior genetic endowment. So 3 centuries later, there are still Kollbergs in Sweden, many of them in top ranks socially and financially (and of course, genetically! There are no dogs in the Kollberg pack!) So high ranking families remain high over time.
But there are also Kollbergs, or people who had a Kollberg grandparent or great-great-grandparent, who are just ordinary Swedes today, working in groceries, programming, selling real estate, and so on. In a sense, they’ve fallen from high rank. On the other hand, they’re still alive and many are prosperous, if not on the same terms of that 18th century general. But while these thousands of Kollberg-descendents worked and married and raised children, thousands and thousands of other Swedes, who just weren’t quite the equals of the Kollbergs in intellegence or character or wealth or family connections, were going bankrupt in thier business dealings, were childless, were dying of what now seem minor illnesses, were emigrating to America, etc. So modern Sweden is actually filled up with Kollbergs and their distant relatives, and the commoners of 1700 and their descendents have left the country or died or live today in a bleak Ibsenian poverty, So the blood of the upper classes seeps down, as it were, into every nook and cranny of the population.
There are probably less crude ways to express all this, of course.
I like your insight that correlation is biased downward when there is measurement noise. Until you had pointed that a few months ago I had not realized that.
If groups with different inherited gifts for success face the same array of incentives, they will (let’s say) tend to end up in the same relative positions generation after generation, whether the incentives are strong or weak. But suppose the point of the incentives is not periodically to shuffle these relative positions but to have a society in which everyone generally tends to make greater efforts, take more risks, etc. Wouldn’t the stronger incentives induce, for each group, more of the desired behavior relative to that induced by weaker incentives (as opposed to: relative to the behavior of other groups facing the same incentives)?
In your review you quote Clark as suggesting that the experience of Nordic countries shows that we could adopt their apparently weaker incentive structure without serious economic fallout. That may be true, but I don’t see how it follows from the argument about social mobility.
High tax rates also have the potential to change what kind of success people will strive for and value. In particular, under high rates of taxation, there will be strong incentives to pursue careers where as much as possible of the remuneration is in the form of untaxable perks. Stability, job security, extensive fringe benefits, lots of paid vacation, frequent trips to exotic locations for professional conferences, flexibility and control of working hours and conditions — e.g. the life of a tenured university professor or a high-ranking bureaucrat. Entrepreneurism could be viewed as a ‘mugs game’ — fail and the failure is yours, succeed and you’ll be treated with suspicion and the proceeds will be increasingly taxed away. Why would the smartest kids aspire to that? Wouldn’t future Pages and Brins be more likely to stay in grad school and less likely to found new companies?
Even if it is true that there are some people who do not respond to incentives (and, in fact, I believe there are, all across the output spectrum) it does not mean at all that incentives don’t matter. Many people DO respond to incentives – the evidence suggests far more than don’t.
“Some A are not B” does not imply “Most/All A are not B”.