THE "WHAT IF" - AROUND THE CORNER

The other day I was perusing the Money section of  USA Today and I found an article that provided confirmation of something I've previously shared with my patient readers.

Now, for those of you who really know me and wondered "what the hell is he doing reading the Money section?", I'll explain.  First of all it wasn't a "bad news" article like so many that I refer to. 

Actually, it was an article that promoted the idea:"We might just be turning the 'corner' in the field of education". 

A bloke, from Scotland named Angus Deaton - whom I've never met - and whose 2010  publication I'll probably not get around to reading any time soon - won the most recent Nobel Prize in Economics. 

It's not the fact that he won. It's that, until he found out from the Royal Swedish Academy of Science why he won - he wasn't quite sure what he did to win because, as he put it: "I've never really had a field"

Upon hearing their explanation his thoughtful response was, "Oh, that's what I have been doing!"

You gotta love this guy.

Angus is 69, an Economics  Professor at Princeton, who, obtained his Bachelors, Masters, and Doctorate degrees from The University Of Cambridge and was a professor of econometrics at the University of Bristol before  joining Princeton in 1983. 

I can't believe I never ran into him!

So, besides the all expense paid trip to Sweden and the increased cash flow - what else makes our Angus so unique?

Happy to explain. You see what caught my eye and that of the RSAOS  was that he dared to think out of the box.

A mathemetician at the start, he claims he sort of drifted into the field of Economics. "It shows" due to his unusual approach to statistical studies and economic theory.

Most treatises on the study and predictions of economics involve either the classical theory or the Keynesian.

 The latter is  better known to us now as 'trickle up" economics as opposed to the "trickle down" theories of the "one percenters" - which has become very popular as well as worthless in today's economy.

But, this is not about either subject, nor politics - both of which leave much to be desired if you're a statistical purist. 

In addition, I should confess, what I recall about economic theory from the three or four Economics courses I took, so far - could probably be jammed into the open end of the classic thimble.

No, what August Deaton did was to link his study of macroeconomics with a study of detailed individual choices

In addition to all of the theories out there, Deaton wanted to frame those economic models with human behavior, ie, how consumers distribute their spending, how much is saved vs spent, and ways to measure both welfare and poverty.

He insisted that the "big picture can't be framed without first understanding individual behavior and the differences among people." To do this he developed detailed surveys to compile data on households, including  poverty-stricken sections of India.

He arrived at some fascinating conclusions such as in 2010 when he determined  "Americans need a salary of $75,000 a year to be happy, but amounts above that do nothing to improve well being."

He also concluded that taller people are happier - but the excellent USA Today article by Paul Davidson did not indicate if August was just referring to the NBA players who may have even been able to track that $75,000 threshold clear back to their college days; when supposedly the dreams of sugar plumbs first danced in their heads.

Deaton also did a study on the relationship between income and calorie consumption, which, while it may have been connected in some way to the perceived smaller bags and increased price for a bag of Fritos we currently confront in our local grocery, the article unfortunately did not go into more detail. 

To wrap this up, and as has been stated many times in previous blogs, the statistical studies and their conclusions we are being expected to blindly abide by - quite often fail to go that extra mile - and validate the results using the habits of real people - not computer generated projections that are also often seduced by inductive logic - not deductive.

I have long been convinced - and have also welcomed the confirmation of a teacher whom I much respect - that the question which should be asked most often of our students - from grade school up through graduate studies - is the simple: "What If?"

Trust me, that will draw out more different thought provoking discussions and tools for life than the Romantic Lit professor's class requested spoken interpretation of the poems of  Keats, Shelly, and Lord Byron. Unfortunately, "W.I.?" has often been discouraged by the limitations of a lesson plan and syllabus which can be audited at will.

I believe that simple "WHAT IF?" is what led August Deaton to capture the Nobel prize for Economics.

Now, let's see just how big that "corner" really is.