Tyler Cowen: disagreement

Transcript context

…Not only that, but it’s also the years where you start having a lot of geographically concentrated shocks because the ’90s and 2000s is when trade with China picks up. It’s where entire towns — it would seem that they should go and pick up. Precisely at the moment where the factors you point out would have made geographic mobility easier and there was also more of a need for people to move — this is when we see people move less. We don’t have the full answer to this question. But I think it’s a little bit correlated to this meaningful-jobs question. This is also the time where the geographic movement would be not associated with finding a job in another furniture factory 200 kilometers away, but would be finding a job in a completely different sector where you would be starting from scratch, and you’re taking a job you think is demeaning. In your recent New York Times op-ed, you seem to argue that incentives are, in general, not that powerful in motivating people economically. And that surprised me because, if I think of most J-PAL papers, incentives are pretty powerful. Your own paper on Indonesian roads — you put in much better roads, many more parents sent their kids to school, right? It’s a big response. The recent paper on drunk driving in India with Abhijit — police set up new road blocks. People respond to that incentive. They take other routes. So there are all these papers you’ve done, your lab has done, showing incentives are powerful. Why in the op-ed say incentives don’t matter so much? What the op-ed says is that financial incentives are overrated.…

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