[Pen-l] Mankiw is half right

["Julio Huato" <juliohuato@xxxxxxxxx>]

http://gregmankiw.blogspot.com/2008/09/fun-with-statistics.html

Mankiw is unpersuaded by Blinder's argument that Dem presidents are
better for the U.S. economy. To show how fair he is, he juxtaposes
Blinder's article (NYT) to that of Mulligan's (WSJ), the latter
arguing that Republicans are better for gender equity.

Since both of them only show "correlation" -- and "correlation"
doesn't imply "causation" -- Mankiw discards both cases. In and by
itself, the argument that correlation is not causation is pretty
inept, since correlation doesn't exclude causation either -- and it
does suggest it.  But whatever.  I won't defend Blinder's.

Now, re. Mulligan's piece, Mankiw has a good reason to be skeptical.
This is why.

You can take CB data and see that, indeed, Dem administrations
coincide with an increase in male to female income. But that's because
*across the board* higher income (e.g. higher *average* income) is
strongly associated with an increase in gaps. In other words, the
reason why the gap grew during Dems is because families could afford
one spouse (typically the wife) staying at home.

How is it bad for families to have *the opportunity* to keep one
spouse at home if they can afford it, compared to the alternative
(having both to work because one income isn't enough)? I'm not saying
that it's good (or bad) that wives stay at home, just that it's better
to have the chance for one spouse to stay home if one income is enough
and the "leisure" thus obtained more than compensates for the foregone
individual income.
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