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When market forces of supply and demand become involved with parts of the human body, the result can be a high degree of ambivalence.  In the US, for example, a system has evolved where the health care system primarily relies on volunteers for blood, but on paying those who donate blood plasma. Not coincidentally the system of paid US now supplies nearly two-thirds of all the blood plasma available in the world.

This pattern is under discussion in Canada, which in recent years has relied on imports of US plasma for 83% of its use. An Expert Panel on Immune Globulin Product Supply and Related Impacts in Canada has recently published a report: Protecting Access to Immune Globulins for Canadians.  The report lays out facts and evidence, without taking a specific position on paid donations for plasma. However, a Canadian group called “Ethicists and Economists for Ethical Donation-Compensation Practices” has published an open letter arguing: \”Both the ethical and the economic arguments against a compensatory model for blood plasma for further manufacture into PDMPs (hereafter: “the compensatory model”) are weak. Moreover, significant ethical considerations speak in favour of the compensatory model …\”

Here\’s some background, drawing heavily on the Canadian Expert Panel report:

\”Plasma is a yellowish coloured liquid component of blood that normally holds the blood cells in whole blood in suspension. It makes up about 55% of the body\’s total blood volume (TBV). It is the raw material manufactured into a range of medications used by Canadians both inside and outside the hospital setting. … Over the years, the use of immune globulins (IG), the most widely used product derived from human plasma, has expanded from the treatment of patients who do not make antibodies to protect themselves from infection (immunodeficiencies) to patients across a broad spectrum of illnesses (hematologic, neurologic, rheumatologic, dermatologic) where it is used as an immune modifier.\”

Dramatically more plasma is collected in the countries where paying donors is widespread: the US, Austria, Czech Republic, and Germany. The Expert Panel again:

\”The only 4 countries that are considered 100% self-sufficient in IG are those that had both voluntary and paid donors as seen in Table 3.2. …  Overall, the US supplies 64% of all plasma collected globally and 74% of all source plasma. In 2015, the US supplied 83% of the plasma used to make IG and PDPs for Canadian patients. The Panel was unable to find any evidence that saturation of the US plasma collection market (i.e. maximum number of plasma donors or source plasma collections has been reached) was a significant risk in the medium term. There were specific geographic regions highlighted in the US where the intensity of plasma collection activity is increasing significantly. In these areas, this concentration of source plasma collection centres drives up competition for plasma donors, which is reflected in the compensation being paid to those donors, however, there were no metrics or evidence submitted to the Panel that suggested that saturation was imminent.\”

Here\’s a figure showing the growth in demand for immunoglobulin products, which come from blood plasma

And here\’s a figure showing hat the number of plasma collection centers in the US is on the rise.

In thinking about payment to blood plasma donors, a few issues immediately arise. We don\’t have a problem in a market economy with paying workers for tasks that are physically exhausting or even tasks that have a degree of risk. But being paid for plasma impose health costs  that should be a concern? Also, does paying for  plasma raise a risk of attracting unhealthy donor, in a way that might compromise the healthiness of the plasma supply? 

Intergenerational economic mobility has two aspects. \”Absolute\” mobility refers to the difference between one generation and the next. In an economy that grows substantially over time, absolute intergenerational mobility can be widespread–that is, most adults currently in the workforce would have higher income than did their parents at the same age. In contrast, \”relative\” mobility refers to whether the ranking of current adults–say, whether they are in the top 10% or the bottom 10%–is correlated with the ranking of their parents.

It\’s possible for there to be upward absolute intergenerational mobility for most people (if the economy is growing), but also to have not much relative intergenerational mobility (if adults tend to have the same ranking in the economy that their parents did). It\’s also possible not to have much absolute or relative intergenerational mobility: this would be a static economy in which people have similar income to their parents and also a similar ranking.
The World Bank summarizes much of the evidence on this question in Fair Progress? Economic Mobility across Generations around the World, by Ambar Narayan, Roy Van der Weide, Alexandru Cojocaru, Christoph Lakner, Silvia Redaelli, Daniel Gerszon Mahler, Rakesh Gupta N. Ramasubbaiah, and Stefan Thewissen (May 2018). Although the report looks at evidence from all around the world, I\’ll focus here on comments about the US economy.

The US has had relatively slow productivity growth for most of the period since the 1970s (although with a nice little spurt of growth in the dot-com years of the late 1990s and early 2000s). In addition, income inequality within any given year has been rising over that time period, too. The combination of slower growth and greater inequality means that absolute intergenerational mobility for the typical adult in the US hasn\’t been very good in recent decades. Moreover, studies that separate out out whether absolute intergenerational mobility in the US has bee more affected by slower growth or by rising inequality tend to point to rising inequality as the main culprit. The report notes:

\”Absolute upward IGM [intergenerational mobility] is likely to be high in a society in which rising prosperity is broadly shared and sustained. Growth in average incomes, which increases the size of the economic pie, is necessary but not sufficient for a high rate of absolute mobility, which also requires a more equitable distribution of the benefits of growth. For example, the sharp decline in absolute mobility in the United States between individuals born in the 1940s and those born in the 1980s was driven more by the unequal distribution of economic growth than the slowdown in aggregate growth since the 1940s. …

\”Research conducted recently in the United States starkly illustrates the importance of not just growth, but also the distribution of growth for  absolute IGM. The share of individuals earning more than their parents in the United States, a reasonable measure of absolute IGM, fell from 90 percent among individuals born in the 1940s to 50 percent among people  born in the 1980s, who are the latest generation of adults of earning age. The decline was driven more by the unequal distribution of economic growth than the slowdown in aggregate growth since the 1940s. 

\”In a simulated U.S. economy in which GDP is maintained at the current level, but distributed across income groups as it was distributed among individuals born in the 1940s, absolute mobility among people born in the 1980s would have been 80 percent, which is 60 percent higher than what is observed. In contrast, if GDP growth since the 1980s were restored to the level of GDP in the 1940s and 1950s, but distributed across income groups as GDP is distributed today, 62 percent of the 1980s generation would have been earning more than their parents (Chetty et al. 2017).\”

When it comes to relative intergenerational mobility, the US econonomy  has long had a reputation for being quite high, but the facts show that a number of other countries have similar levels. Part of the issue here is that the US distribution of income is more spread out that that of many other countries, and as a result, going from (say) the bottom third of the US income distribution to the top third requires a bigger jump than would be involved in a country with a more equal distribution of income, where the bottom third and top third are closer together.  Here\’s the report:

\”Low relative mobility also implies that privilege and poverty alike are highly persistent across generations in many societies. For example, in the United States, a quarter of the sons born to fathers in the top 10 percent of earnings are also among the top 10 percenters as adults, and most sons born to top 10 percent fathers are at least in the top 30 percent. By contrast, 22 percent of sons born to fathers in the bottom 10 percent remain in the bottom decile as adults, and half remain in the bottom 30 percent. … [P]erceptions of mobility can also diverge from actual mobility, particularly if comparisons are made across countries. For example, perceived mobility is higher among Americans compared with Europeans, despite mounting empirical evidence that relative IGM is lower in the United States than in several European countries.\”

Here\’s a figure showing the overall connection between higher relative intergenerational mobility and lower income inequality.

Part of the reason for the modest level of intergenerational mobility in the US economy is that the level of education for adults has a fairly high correlation with the level of education received by their parents. The World Bank report summarizes this way:

\”In a large majority of economies across the world, one’s chances of reaching the top quarter of the ladder of educational attainment depend largely on where one’s parents stood on that ladder (figure 3.6). This share would be 0.25 if one’s ability to obtain an education did not depend on how well-educated one’s parents are. However, there are few economies in which the share exceeds 0.20. The developing world dominates on the list of economies with the lowest share among the 1980s generation. Among the bottom 50 economies, 46 are developing, whereas only 4 are high income, including the United States.\”

Thus, it seems plausible that in the US, higher education is acting in part as a way of passing economic success between generations. As a result, the US is not making full use of the talents of many of its citizens. As the report notes: 

\”Bell et al. (2017) provide a telling example from the United States on the effect of lost human potential due to low social mobility. They find that the probability a child will become an inventor is many times greater among children in rich families than among children in lower-income families and that a large share of this innovation gap can be attributed to differences in childhood environment. Thus, improving opportunities for social mobility could benefit not only the disadvantaged children, but also the overall society by increasing the rate of innovation and economic growth. More generally, realizing the wasted human potential would generate a rise in the overall stock of human capital in an economy, which could have a strong impact on long-term growth.\”

It\’s easy to say that everyone is in favor of a high degree of intergenerational economic mobility, but I don\’t think that\’s quite true. Sure, most people favor absolute economic mobility across generations–people having more income than their parents did at the same age. But when it comes to relative economic mobility, we tend to favor it only for those outside our own families. As I wrote a few years ago in an earlier post:

\”It\’s easy to say that \”we\’re all in favor\” of mobility between generations, but of course, in practice, many of us aren\’t. After all, the highest level of intergenerational mobility would mean zero correlation between incomes of parents and children. I earn an above-average income, and I invest time and energy and money make location choices so that my children will greater human capital and earn above-average incomes, too. Thus, I must admit that I do not favor completely free mobility of incomes. I\’m sure I\’m not alone. Divide the income distribution into fifths, and think about parents in the top fifth. How many of them would like to live in an economy where their children have an equal chance of ending up in any of the other fifths of the income distribution?\”

For some earlier posts on intergenerational economic mobility, see: 

• \”Intergenerational Economic Mobility\” (March 5, 2013)
• \”Income Mobility\” (February 3, 2014)
• \”The Great Gatsby Curve\” (February 28, 2014)
• \”How Higher Education Perpetuates Intergenerational Inequality\” (March 4, 2015)

QALY is an abbreviation for \”quality-adjusted life-year.\” It refers to gains in health, which combine a time dimension and an adjustment for quality of life. Peter J. Neumann and Joshua T. Cohen offer a quick overview in \”QALYs in 2018—Advantages and Concerns,\” a \”Viewpoint\” article written for the Journal of the American Medical Association (May 24, 2018). Thus, even if you strongly dislike the idea of a QALY, you might want to be aware that your doctors and health care administrators are paying attention to them.

Here\’s an explanation on the basic concept:

\”A year in the hypothetical state of “perfect health” is worth 1 QALY. Being deceased is worth 0 QALYs. Other health states fall between these bounds, with less desirable states closer to 0. QALYs are useful because they combine mortality and morbidity into a single metric, reflect individual preferences, and can be used as a standard measure of health gains across diverse treatments and settings.

\”Consider, for example, calculation of QALYs accrued by a hypothetical individual after age 70 years who develops cancer at age 74 years and who dies at age 76 years. If the health utility weight for a typical healthy individual in his or her 70s is 0.95 and the health utility weight while living with this particular cancer is 0.75, then after age 70 years, this individual accrues (4 years × 0.95) + (2 years × 0.75) = 5.3 QALYs. If screening leads to elimination of the cancer before symptom onset and extends the individual’s life from age 76 years to age 80 years, then with screening, the individual accrues 10 years × 0.95 = 9.5 QALYs.\”

Notice that a QALY is a more flexible tool than just talking about the value of a statistical life saved (discussed here and here), because a QALY includes both a measure of how long life expectancy is extended and what the quality of life is during that time.

The Institute for New Economic Thinking has posted video of a six-part series: \”What Money Can\’t Buy.\”  The series revolves around philosopher Michael Sandel, who has thought about the intersection of economic motivations with other values as deeply as anyone. At times, Sandel discusses questions with prominent economists (Greg Mankiw, Richard Posner, Joseph Stiglitz, Lawrence H. Summers, and others). But most of the videos are a seminar-style discussion with Sandel and 12 students.

Episode 1: Sex Sells, But Should It? (Should We Be Able to Discriminate Based on Looks?)
Episode 2: The Body Market (Should You Be Able to Sell Your Kidney?)
Episode 3: The Walrus Quota (Should We Be Able to Sell Refugees?)
Episode 4: Supply Shock (Should You Be Able to Sell Water In A Disaster?)
Episode 5: The Golden Door (Should We Pay People to Vote?)
Episode 6: The Death Pool (Should We Be Able to Profit Off of Death?)

For an example of Sandel\’s style, one starting point is his article in the Fall 2013 issue of the Journal of Economic Perspectives, \”Market Reasoning as Moral Reasoning: Why Economists Should Re-engage with Political Philosophy\” (27:4, pp. 121-40). When it comes to ideas, Sandel is a poker and a prodder, putting forward possible hypotheses and pushing their edges, always on the lookout for potential qualifications, exceptions, and counterbalancing factors. His answers, to the extent that he offers any, are often provisional and hedged. But you can learn a lot about the terrain of these arguments and about philosophical reasoning by following along.

The US unemployment rate has been less than 4% for the last couple of months, which might seem sufficient reason for breaking out the champagne. But the sense of celebration has been generally restrained.

Or consider the concern that although unemployment has dropped, a substantial portion of the decline is due to adults who have become discourage, left the workforce and are no longer looking for jobs, or who have taken part-time jobs but would prefer full-time. Here\’s a figure from the Bureau of Labor Statistics showing several different measures of unemployment. The red line at the bottom is the standard unemployment rate. The light green line just above it adds the \”discouraged\” workers who would like a job. and looked for a job in the previous year, but have stopped looking because they don\’t think one is available. The teal line above that adds both discouraged and \”marginally attached\” workers, who looked for a job in the previous year and have stopped looking (even though they recognize that jobs are available). The top purple line includes the unemployed, discouraged, marginally attached, and those who are working part-time but would rather work full-time.

Overall, there are a lot of ways to look at unemployment, but whatever measure you choose, the measure is essentially back to what it was before the Great Recession.

Or here\’s the employment rate for 25-54 year-olds, with separate lines for males (red line), females (green line), and total (blue line). The focus here is on \”prime-age\” workers, leaving out young adults who are attending college at increasing rates and near-retirees. There is a downward trend for men and an upward trend for women over the decades. But the current levels have rebounded back pretty much to where they were before the Great Recession. 

What about growth of wages and employee compensation? Here\’s a figure showing percentage growth in the last 12 months in the Employment Cost Index (blue line), which is commonly used because it covers all civilian workers and their benefits. The green line is a measure of the inflation rate faced by consumers called the Personal Consumption Expenditures Index, Less Food and Energy, which is the measure of inflation to which the the Federal Reserve pays attention.  Yes, growth in compensation is not as far above inflation as it was in the years before the Great Recession. But the gap does seem to be widening. 

What about the concern that although overall unemployment rates are down, those who are unemployed are more likely to be long-term unemployed. This concern still has some bite, but less than a few years ago. This figure shows median (blue line) and average (red line) duration of unemployment. Median is the number where half are above and half are below. The average is higher than the median because those who are unemployed for a long time pull the average higher. The median duration of unemployment is back to what it was before the Great Recession, and comparable to what it was in the mid-1990s. 

The share of unemployed who had had been out of a job for more than 27 weeks spiked much higher during the Great Recession than during previous recessions. But even that share has come down to levels that are at least comparable to the highs of the past, although not yet the lows. 

There is no heaven on Earth, and there is no ultimate perfection to be found in real-world labor markets. But the current US labor market situation is really quite good. After looking at the recent numbers, the New York Times ran a headline \”We Ran Out of Words to Describe How Good the Jobs Numbers Are\” (in a story by Neil Irwin, June 1, 2018). Among the descriptors suggested there are \”splendid,\” \”excellent,\” and \”salubrious.\” 

The Council on Foreign Relations has published The Work Ahead Machines, Skills, and U.S. Leadership in the Twenty-First Century, which is an Independent Task Force Report chaired by John Engler and Penny Pritzker,  Some of the discussion goes over familiar ground: innovation is needed, technology is changing work, economic growth is important, we should redesign unemployment assistance and sick leave for the modern work force, we should do more to assist displaced workers, and so on.  But I want to focus on one chapter of the report, \”Education, Training, and the Labor Market,\” and its discussion of that how the interaction between education and job training has been shifting.

Early in the 20th century, for example, the US experienced an enormous surge in high school completion rates, and for most of those graduates, the high school education was good and sufficient preparation for moving into the workforce. The report notes (footnotes omitted):

\”From 1910 to 1940, just as modern techniques of mass production were being spread across the country, the number of fourteen- to seventeen-year-old Americans attending high school rose from 18 to 73 percent, and high school completion rose from 9 to 51 percent. No other country even came close to achieving these levels until decades later. Most of the progress was led by state and local governments and citizen groups seized with the urgency of extending free education to as many young people as possible, not by the federal government. The lack of accessible educational opportunities that are clearly and transparently linked to the changing demands of the job market is a significant obstacle to improving work outcomes for Americans. Most of these students did not go on to college but rather went directly into the workforce, with high school completion marking the essential credential needed for most to succeed.\”

\”Employers, for their part, have been slow to develop or expand their own training systems to fill in the gaps from the educational system. …  Personnel hiring decisions may be the most important ones that any employer makes, yet most employers make those decisions entirely on the spot market. No company would leave its acquisition of critical raw materials or components to the last moment, but most hiring decisions are made as jobs come open. Employers find themselves competing for often scarce pools of talent, without developing and deepening those talent pools themselves. According to a Harvard Business School survey, just one-quarter of  companies have any type of relationship with local community colleges to help prepare employees with the skills they need. Not surprisingly, given their lack of involvement, many companies complain that too few graduates leave school with skills that employers are demanding.  … A successful workforce model for the twenty-first century will require a different mind-set. Employers need to think about not just competing for talent, but also how to develop the pipeline of talent they need to build their workforce. That will require greater collaboration not just with educational providers but also with other, even competing, employers. Employers should embrace collaborative approaches to talent development; big gains could be made, for example, by industry sectors working together to ensure a steady flow of properly educated and trained students for their future workforce. … Such work-experience programs are too rare—just 20 percent of adults report having received any sort of work experience as part of their education, and most of that was concentrated in health care and teaching.\” 

The marshmallow test is one of those legends of social science that a lot of non-social-scientists have heard about. Relatively young children are offered a choice: they can either eat a marshmallow (or some other attractive treat) right now, or they can wait for some period of time (maybe 15-20 minutes) and then have two marshmallows. If you follow up on these children some years later, the legend goes, you find that those who were able to defer gratification early in life will have more success later in life. A satisfyingly moralistic policy recommendation follows: If we could teach young children to defer gratification, that skill might help them as they advance in life.

It\’s a great story. Is it true? Tyler W. Watts, Greg J. Duncan, and Haonan Quan call it into doubt in their  study \”Revisiting the Marshmallow Test: A Conceptual Replication Investigating Links Between Early Delay of Gratification and Later Outcomes,\” just published in the journal Psychological Science (2018). 

They go back to the original 1990 study: Shoda, Y., Mischel, W.,  and Peake, P. K. (1990). \”Predicting adolescent cognitive and self-regulatory competencies from preschool delay of gratification: Identifying diagnostic conditions.\” Developmental Psychology, 26(6), 978-986.  The original sample for this study was collected over a period of six years (1968-1974) among preschool students at the Bing Nursery School at Stanford University, described in the study as \”mostly middle-class children of faculty and students from the Stanford University community.\” The studies included 653 preschool children, average age about four years. About 10 years later, surveys were mailed to parents whose addresses could be located, ending up with follow-up data on 185 children.

The study found that there was a positive correlation between children who were more likely to defer gratification at age 4, and those who were later rated by their parents as \”more likely to exhibit self-control in frustrating situations, less likely to yield to temptation, more intelligent, and less distractable\” compared to their peers. There was also some mild evidence (because there wasn\’t data for many of the students on this point) that SAT scores were higher for those who deferred gratification at age 4.

The more recent study used data from the National Institute of Child Health and Human Development (NICHD) Study of Early Child Care and Youth Development (SECCYD). This study draws on 10 different sites around the country, and tracks and studies a group of children up to age 15. Using this data, the researchers could look at children who had done a delay-of-gratification test by the age of four years, six months, and where they had follow-up data on behavior and educational achievement at age 15. The total sample size was 918. Of that group, the mothers of 552 of the children had not completed college when the child was one month old, which allows the researchers to split the sample into children whose mothers had completed college, and those who had not.

Before describing the results, just consider the samples. The second study is not a nationally representative sample. But it\’s larger in size and more representative than a single nursery school on the Stanford campus.

The follow-up study did find positive correlations between deferred gratification and some later measures, but the correlations were small, when they existed at all. In addition, the follow-up study was able to study whether the differences in deferred gratification might instead be picking up other factors. For example:

\”[D]elay of gratification was strongly correlated with concurrent measures of cognitive ability … This implies that an intervention that altered a child’s ability to delay but failed to change more general cognitive and behavioral capacities would likely have limited effects on later outcomes. If intervention developers hope to generate program impacts that replicate the long-term marshmallow test findings, targeting the broader cognitive and behavioral abilities related to delay of gratification might prove more fruitful.\”

The follow-up study did have problems of its own. For example, the study asked children to defer gratification for 7 minutes, rather than the 15-20 minutes in the earlier studies. But for the group of children whose mothers had completed a four-year college degree, most of the children waited the full seven minutes. Thus, it wasn\’t possible within this group to draw meaningful conclusions about deferred gratification and later behaviors.

Of course, this finding suggests that a higher education for the mother can be relevant to whether a four-year-old can defer gratification, but even in this case, \”most of the achievement boost for early delay ability was gained by waiting a mere 20 s.\” In other words, in the part of the sample for mothers who had not completed college, children who barely waited at all did perform less well, and waiting even 20 seconds was mildly associated with later gains for this group.

The short lesson here is not to freak out if your four-year-old gobbles some candy. The longer lesson is that level of mother\’s education is relevant to children\’s development, and that improving cognitive skills at younger ages can matter. Fpr some additional discussion of the results, see these short pieces in the Atlantic and the Guardian.

Sweden seems headed toward a cash-free economy. Here are some comments from Stefan Ingves, Governor of Sveriges Riksbank, the central bank of Sweden, in a short essay called \”Going Cashless:
The governor of the world’s oldest central bank discusses his country’s shift toward digital money\” (Finance & Development, March 2018, 55:2, pp. 11-12):

\”Sweden is rapidly moving away from cash. Demand for cash has dropped by more than 50 percent over the past decade as a growing number of people rely on debit cards or a mobile phone application, Swish, which enables real-time payments between individuals. More than half of all bank branches no longer handle cash. Seven out of ten consumers say they can manage without cash, while half of all merchants expect to stop accepting cash by 2025 (Arvidsson, Hedman, and Segendorf 2018). And cash now accounts for just 13 percent of payments in stores, according to a study of payment habits in Sweden (Riksbank 2018). …

I am convinced that within 10 years we will almost exclusively be paying digitally, both in Sweden and in many parts of the world. Even today, young people, at least in Sweden, use practically no cash at all. This demographic dimension is also why I believe that cash’s decline can be neither stopped nor reversed. While the Nordic countries are at the forefront, we are not alone. It is interesting to see how quickly the Chinese payments market, for instance, is changing.

Ingves mentions some issues that are likely to arise with this transition. One is that \”it will likely further limit financial access for groups in society that currently lack any means of payment other than cash.\” Other issues are the extent to which the new payments infrastructure, which may shift in substantial part from central banks to private firms, will be safe, secure, rapid, and low-cost.

Japan is aging fast. Here are some trends on total population and age distribution, according to projections from the National Institute of Population and Social Security Research in Japan,

Many of the public policy disputes over education, whether at the K-12 level or at the higher education level, quickly turn into disputes over how much to spent, or whether \”enough\” is being spent. For some international perspective on these issues, the Condition of Education 2018  has just been published by the National Center for Education Statistics (May 2018). It\’s chock-full of useful tables and figures, but here are a few from the \”International Comparisons\” part of the volume.

First, look at spending per student in OECD countries, as compared with per capita GDP. As the figure shows, the relationship is pretty much a straight line, in which countries with higher per capita GDP spend more on K-12 education. This makes some intuitive sense, given that  teachers are one of the main expenses in any K-12 system, and when a country has higher capita GDP, wages in general and pay for teachers in particular will be higher, too. The figure shows that while a few countries spend a little less than one might expect on K-12 education based on their per capita GDP (Mexico, Ireland) and some spend a little more (Korea, United Kingdom), most countries are quite close to the predicted line, like the United States.

Of course, this doesn\’t prove whether the US should dramatically change its level of K-12 education spending. But it suggests that US K-12 spending is not out-of-line with the rest of the world in this area.

What does a similar figure look like for higher education spending? Some interesting patterns emerge. For example, Mexico spent less on K-12 than one would predict from per capita GDP, but spends more on higher education. Conversely, Korea spent more on K-12 than one would predict based on per capita GDP, but spends less on higher ed. The United States spend way more than any other country on higher education on a per capita basis, and way more than would be predicted based on per capita GDP.

Of course, this doesn\’t prove whether the US should dramatically change its level of higher education spending, or how US higher education is delivered. But it suggests that the US higher education experience is different from most of the rest of the world.

Here\’s one more comparison, looking at the share of adults who have a postsecondary degree of some kind. In the figure, the light blue bars show the share in the 55-64 age bracket who have such a degree, while the dark blue bars show the share in the 25-34 age bracket with such a degree. One would generally expect that as higher education expands, a larger share of those in the younger group should have postsecondary degrees, compared with those in the older group, and this pattern holds for most countries.

But notice that for the US, the age 55-64 group was in general more educated than the rest of the world, with the exception of Canada. But for the 25-34 group, the US is still above the OECD average in share with a postsecondary degree, but a number of other countries are now substantially ahead, and the US is much more middle-of-the-pack. When combined with the previous figure, this makes some sense. Given that the US spends vastly more on a per person basis for higher education, it\’s more costly for the US to provide a big expansion of higher education for the young adults of today.