Edward Conard

Top Ten New York Times Bestselling Author

  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “Unintended Consequences is far smarter and more thought-provoking than most economics written for the general public” - Greg Mankiw, Harvard University, Former Chairman of the Council of Economic Advisors
  • “There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
Upside of Inequality Oxford Unintended Consequences

AI Summary. Wages at age 50 rise more steeply with cognitive skills measured at age 16 than with cognitive skills measured at age 50; for women, moving from average to two standard deviations above average raises expected hourly wages from £11 to £22 using age-16 skills, versus £12 to £15 using age-50 skills.

Uta Bolt The Economic Journal
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Data from a British birth cohort followed since 1958 show that cognitive skills early in life predict wages at age 50 better than cognitive skills at age 50. Early cognitive skills likely allow for higher educational attainment or on-the-job learning.

Do teenage cognitive skills predict midlife wages better than adult skills?

Core argument: For women, moving from mean cognitive skills at age 16 to two standard deviations above the mean raises expected age-50 wages from £11 to £22, while the same move in age-50 cognitive skills raises wages only from £12 to £15.

Figure 2 shows the relationship between expected wages at age 50 and cognitive skills at ages 16 and 50, respectively. To construct the figure, I first regress wages at age 50 on a cubic polynomial of cognitive skills at 16. Next, I regress wages at age 50 on a cubic polynomial of cognitive skills at 50. I then use the estimated coefficients from the two regressions to predict the expected wage at age 50 at different values of cognitive skills. For both men and women, we can see a much steeper gradient of age-50 wages in cognitive skills at age 16 than in cognitive skills at age 50. Moving from mean cognitive skills at age 16 to two standard deviations above the mean increases the expected wage for women from £11 to £22. In contrast, moving from mean cognitive skills at age 50 to two standard deviations above the mean only increases wages from £12 to £15. For men, the patterns are similar, albeit somewhat less stark. Having high cognitive skills at the end of childhood is more important than having high cognitive skills in the middle of adulthood, as high early cognitive skills allow for higher educational attainment or learning on the job that is associated with higher wages.

Takeaways by Macro Roundup® AI

  1. For women, moving from mean cognitive skills at age 16 to two standard deviations above the mean raises expected age-50 wages from £11 to £22, while the same move in age-50 cognitive skills raises wages only from £12 to £15.
  2. Regressions of age-50 wages on cubic polynomials of cognitive skills show a steeper wage gradient in skills measured at age 16 than in skills measured at age 50 for both men and women, with men's patterns somewhat less stark.
  3. The author argues that high cognitive skills at the end of childhood matter more than in middle adulthood because early skills allow higher educational attainment or learning on the job associated with higher wages.

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