02 June 2010

The Density of Human Capital: Propping Up Civilisation

Clusters of smart people of the highly educated sort that economists refer to as "human capital" are the key engine of economic growth and development. Jane Jacobs argued that the clustering of talented and energetic in cities is the fundamental driving force of economic development. In a classic essay, "On the Mechanics of Economic Development," the Nobel prize-winning, University of Chicago economist Robert Lucas formalized Jacobs' insights and argued that human capital, or what can be called Jane Jacobs externalities, are indeed the key factor in economic growth and development. Still, the standard way economists measure human capital is to take the percentage of people in a country, state, or metropolitan area with a bachelor's degree or higher. _Atlantic

For a high-tech society to survive, it must contain enough smart people -- have a high enough smart fraction -- to not only maintain the technology, but to improve it. SubSaharan Africa -- with a mean IQ of less than 80 points -- would have no high tech infrastructure at all, if not for outside help. The nations of Europe, Japan, Russia, and the Anglosphere -- with mean IQs near or above 100 -- would have enough human capital to maintain and improve their high tech infrastructure, if not for the ongoing demographic collapse in most of those countries.

Smart fraction densities can vary within an individual nation, just as they vary between different nations and continents. The highest density of smart people tends to occur in large metropolitan areas containing multiple institutions of higher learning -- particularly technical and professional graduate schools. Always remember that not all college degrees are equivalent as indicators of intelligence -- and competence.

All other things being equal, regions with the highest smart fraction densities will tend to be more productive, with higher levels of affluence generally.

The map above demonstrates that in order to take advantage of the high productivity of a high technology infrastructure, a nation must have a high enough average IQ to field a wide range of professions and occupations -- for both maintenance of the infrastructure, and improvement of the infrastructure.

Of course if you have an entire region full of PhDs with degrees in ethnic and queer studies, the correlation loses significance. The analysis behind the images above relies upon the college degrees being distributed with the useful degrees numerous enough to counteract the "trash degrees" such as women's studies, ethnic studies, queer studies, and other post-modern degrees of academic lobotomy.

When comparing countries, one must also take into account various forms of government which may counteract the effect of high mean intelligence. North Korea has a population very similar genetically to South Korea, but because of its oppressive government, the underlying intelligence of the people cannot be converted into a prosperous nation. The same natural experiment was performed in East and West Germany, during the oppressive years of the post-WWII USSR. The west prospered because the people were allowed the freedom to translate intelligence and competence into prosperity. The east was held back by oppressive communist governments.

The welfare state is a somewhat milder form of oppression -- in terms of limiting the choices that intelligent and competent persons might otherwise have made. Certainly one of the significant side effects of the welfare state is the ongoing demographic collapse of most of its practitioners. Taxation under a welfare state grows to the point that taxpayers can no longer afford to expand their families. Perennial tax recipients -- typically of lower intelligence than the more productive taxpayers -- sometimes grow their families a bit too much for the welfare, health care, remedial education, and prison systems to handle.

By that mechanism, a once-intelligent country or region can grow into an idiocracy -- via the welfare state.

If you look closely at the topmost chart of college degrees vs. US cities, you will find excellent starting points for the exploration of that very destructive transitional process.

H/T Richard Florida

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Blogger SwampWoman said...

I know a lot of people with college degrees (that I consider to be worthless) that are fairly clueless. I'm not sure that we could (or should) count them as people that keep civilization going.

Personally, I'd rather rely on a good auto mechanic.

Wednesday, 02 June, 2010  
Blogger George said...

There are lies, damned lies and then there are statistics.

I'm making the inference that they have factored in the population density of these communities to get these results.

In the second chart they have Clark Nevada listed in last place. Clark is a county, a very large county with the population density in Las Vegas.

I've done well even though my parents said college was a waste of time for me.

Wednesday, 02 June, 2010  
Blogger Sojka's Call said...

I agree with SwampWoman!

Understandably, you have to start with some kind of measure and college degree is one kind - it does take some basic intelligence to get through most colleges.

To SwampWoman's point, in my career working with PHD's on a daily basis it was obvious that some of them were not that bright and had a hard time stringing two coherent sentences together.

But, in the grand scheme I think looking at the basic IQ of the nation population and the college degrees will give a good idea of that groups potential. Degrees per square mile might be just an indicator for how high the population density is and not how many educated people per capita.

Interesting assessment of the sub-Sahara and the perpetual dependence some nations will have on the educated/intelligent segments of the world. China's wooing of that region now seems very intelligent to secure natural resources later.

Wednesday, 02 June, 2010  
Blogger bruce said...

You have the worthless degrees, simple enough to understand, but then you have lawyers/politicians, a huge sinkhole of intellectual waste.

Their particular loss is two fold. Not only is their intellect lost to positive endeavors, that intelligence is used to stifle and reduce the ability of the remaining.

Their quantity is proportional to their ability to govern a culture's success.

To that end I am holding out hope that the era of apology- self degradation declines. That a culture that is successful claims its merits and doesn't try to make terms with the less endowed.

Wednesday, 02 June, 2010  
Blogger al fin said...

Right. Many degrees are worthless. And some degrees are worse than worthless. Agreed.

US universities are corrupted by politics and "multi-cultural correctness", as are the lower levels of education.

Personally, I want to know a person's IQ and his EF (executive function) in addition to his personal history (ambition and integrity). A degree by itself signifies very little.

Western civ is nosediving into a swamp of debt and demographic collapse. That is why I keep saying that you need to be making your own plans independent of any projections for the future being made by government, news media, academics, etc.

Keep in mind that the fastest growing category of millionaires in the US is firemen, policemen, and other public servants who will retire in their mid-fifties on full salary (often 6 figure salaries), and will live for about 30 years.

It is simply not sustainable, when the private sector continues to be strangled by ever-increasing government regulations, taxes, unfunded mandates, energy starvation, and opportunity destruction.

Wednesday, 02 June, 2010  
Blogger Unknown said...

As I look at the locations, it comes to me that most of our troubles originate in the same places. I wonder if there's a correlation?

Wednesday, 02 June, 2010  
Blogger neil craig said...

If this is true then the internet should be a step change improvement in human progress. For the first time intellectual communities working in real time can & do exist across the globe.

The fact that world economic growth has averaged 5% over the last decade suggests this may be so. As does the crumbling of the global warming scam brought about by sceptics across the world who had usually never met.

Of course if such a step change has happened the facts that western countries have not achieved even close to average growth & that our mainstream media could sell the Luddite warming scam (among others) in the first place shows how very destructive state parasitism here is.

Thursday, 03 June, 2010  
Blogger read it said...

The college degree charts are bull. How many of those are total crap degrees? Masters of Social Work with emphasis on distributing tax $$ to losers anyone?

It doesn't really matter how credentialed people are. What is important is whether they are smart, conscientious, creative, etc.

A sociology degree ≠ chemistry degree or even journeyman electrician.

Thursday, 03 June, 2010  
Blogger read it said...

Okay, I figured out the San Francisco and New York topping the charts for degrees. Census shows San Francisco is 31% Asian. We all know New York has many Jewish folks who are college educated.

I bet the percent of Asians with college degrees is similar in San Francisco and Oklahoma City. Same for Jewish people in New York and Jefferson Alabama.

When I consider the megalopolis risk to its inhabitants, I would argue these folks would be smart to spread out a little. :-)

Thursday, 03 June, 2010  
Blogger painlord2k@gmail.com said...

The government systems can not be fixed internally, they must be fixed externally. The only way to obtain this type of change is when someone hold a gun to the head of the government and of the society (like it is happening for the PIGs) and sometimes they fail to recognize the reality. The other way is to bleed the system out of existence causing people to move somewhere else. When the government and the society is no more string enough to oppose changing, it will change or will be supplanted.

I have hope for the next few years about the Seasteading. If they are able to start something self sustainable, there is the real possibility of something like a "PC revolution". Governments would not be happy. But a place where people can keep the large part of the fruit of their work, opposed to a place where they must give up half of it or more, have a very strong attraction.
Given the governments are not able to stop the drug trafficking, I'm sure they will not be able to stop the seasteading (maybe slow it a bit). But there are too much people and interests that would have an use for this type of technology.

Saturday, 05 June, 2010  

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“During times of universal deceit, telling the truth becomes a revolutionary act” _George Orwell

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