2022-23 CASBS fellow Rohini Somanathan chats with renowned economist, public intellectual, & 2015-16 CASBS fellow Glenn Loury. Having recently completed a draft of his memoir, Loury reflects on why he pursued economics; the role of institutions in providing intellectual space and stimulus; his latest thoughts on the persistence of racial inequality, and much more.
Coate & Loury (1993), "Will Affirmative-Action Policies Eliminate Negative Stereotypes?"
Loury, The Anatomy of Racial Inequality (The Du Bois Lectures)
The Tanner Lectures at Stanford (2007) Lecture 1 | Lecture 2
Loury (2008), Race, Incarceration, and American Values
Loury (2019), "Why Does Racial Inequality Persist?"
Somanathan and Allen, eds. (2020) Difference without Domination: Pursuing Justice in Diverse Democracies
Loury public symposium at CASBS (2016), "Racial Inequality in 21st Century America" (video)
CASBS webcast (2020), "The Persistence of Racial Inequality" (video); panel featuring Glenn Loury, Joshua Cohen, Francis Fukuyama, Alondra Nelso, & Margaret Levi
The Glenn Show (Manhattan Institute)
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Narrator [0:08]
From the Center for Advanced Study in the behavioral sciences at Stanford University, this is Human Centered.
Today on Human Centered, 2022-23 CASBS fellow Rohini Somanathan interviews renowned economist, public intellectual, and 2015-16 CASBS fellow Glenn Loury. Glenn is the Merton P. Stoltz Professor in the Social Sciences and Professor of Economics at Brown University. He's been well recognized for his scholarly work throughout his career, now in its fourth decade. As a sampling, he's been elected as a fellow of the American Academy of Arts and Sciences, the American Academy of Political and Social Science, the American Philosophical Society, and as a Distinguished Fellow by the American Economic Association. Glenn is also a prominent social critic writing and commenting on racial inequality and social policy in various outlets, including on his own popular “The Glenn Show,” found both on YouTube and Substack. He's the author of several important works, many of which he and Rohini discuss; we’ll provide links to those as well as to Glenn’s show in the episode notes.
Rohini Somanathan is a professor of economics at the Delhi School of Economics. A deep and broad thinking social scientist, she was the first woman based in India to be elected as a fellow to the Econometric Society. In 2020, she co-edited with Daniel Allen the book Difference Without Domination: Pursuing Justice in Diverse Democracies, a volume two which Glenn contributed a chapter. But that's not the only thing connecting the two – thirty years ago, as a graduate student in economics at Boston University, she took doctoral classes with Glenn. It's this decade's-long connection that makes today's podcast pairing so special. Rohini approaches the conversation from a unique vantage point that draws out a different Glenn Lowry than many think they know. She finds him now at a time of reflection. Earlier in 2023, he completed a full draft of his highly anticipated memoir, a project he began during his CASBS Fellowship.
As you're about to hear, Rohini and Glenn immerse in a rich discussion of why he pursued economics in the first place; why, while at Harvard, he moved from the economics department to the Kennedy School of Government; how he emerged as a public intellectual, the role and variation among institutions in providing intellectual space and stimulus; his thoughts on the persistence of racial inequality; the importance of intellectual humility in situating the profession of economics among other social sciences; and so much more.
And a quick note, around two-thirds of the way into the conversation, we'll hear a question from CASBS communications director Mike Gaetani that elicited a thoughtful response from Glenn. So keep your ears open, and let's listen in.
Rohini Somanathan [03:01]
So, Glenn, thank you so much. It's..it was, you know…it's such a privilege to do this 30 years after I first sat in a classroom with you lecturing. And I was just so amazed at, you know, how anyone could go through all that mathematics and just say it…you know, just speak full sentences, one after another. And there was all this technical material. And I just said, ‘wow,’ you know, at that point when you were teaching that class on inequality. And then to be here, several years after you were at CASBS, up on the hill, part of academic life and Stanford but also in our own little space. And, so, maybe we will get started by talking about your experience here. What you did – I know you started on your memoirs – why then, what was it all like?
Glenn Loury [03:52]
Oh, well, first, let me say it's wonderful to be talking to you and very sweet to hear you recall so fondly as being in the classroom with me in front. And look at what you've managed to do with your career with these 30 years. It's a…it's a really gratifying thing to see. So, you know…CASBS…yeah, it was a wonderful year, 2015 16. This book that I promised…Margaret Levi that I was going to write while I was there is just coming to completion here some seven years down the road, but that's okay. It's coming to completion. I'm very gratified about it. But it was a wonderful time, as you say, up there, on the hill in this beautiful idyllic spot, close to Stanford but apart from Stanford, serious people, wonderful diversity of intellectual interest and it was a lively, engaging time and people were friendly and I made friends. So, yeah…
Rohini [04:55]
And why your memoirs, Glenn. Why did you at that point decide to embark on a memoir?
Glenn [05:02]
Well, I've been thinking about it for a while. The year I had the leave…and I applied for a fellowship and needed a, you know, I needed…’what am I going to work on?’ The honest answer is, if I had had a scientific project that was absolutely compelling to me, and that I thought must be done in order to advance the frontier and to inspire other researchers, that would have been what I undertook to do. And Stanford would have been a wonderful place to do it. But, you know, I'm at a stage in my career now – I was then and am still – where, perhaps, the contributions that I have to make to economic science are largely in the can. And some stepping back and reflecting – reflecting on one's life and on one's work maybe is the appropriate occupation for a person of my many decades as a scholar, and I thought I had a story to tell. So I was tempted by the memoir idea, and needed, as I say, to tell people…something about what I was going to do with my time in the sun. So I just thought I'd take a stab at it. I came up with a title, I was calling it Changing My Mind, because I thought it was going to be about evolution of political, ideological commitment in my own life of conservative and more or less liberal and all of that…and combine that with my interest in race-related questions, which has been a preoccupation of the economics of racial inequality, and the politics and sociology…of social stratification by race and ethnicity. These…questions have been important to me throughout my career, and I've got to try to combine a reflection on that as a scholar with my personal development. But I just couldn't quite…find my voice and get a clear enough framework for the work to get anywhere near completion. I did grow. I did learn some things. But I left CASBS Without a manuscript and have gone years making stabs at it until finally, finally, I'd say maybe 18 months ago, I finally got a working method that allowed me to begin to make some progress. And,as I say, we're at the publisher now.
Rohini [07:49]
That's very reassuring as well, because I think I'm in the same position. We're two months away from the end of our fellowship, and I've been struggling thinking about this book is going to come together. So you're going to help me do that at some later point.
But I want to talk about you starting off as a mathematical economist with people all around you really impressed in your technical abilities. And yet you were also interested in policy debates on inequality and race and wanted to be a part of them. And did you think that these were different worlds? And did you struggle to bring them together? Or were they naturally part of the same world? And was…mathematics just your perspective into issues of race and inequality?
Glenn [08:34]
Oh, that's a lovely question. I struggle. That's one of the themes, I think, in my intellectual biography is a reconciliation of the interest in the depth and the profundity and the beauty of applied mathematics. I mean, we're economists, we're not mathematicians, but the application of precise analytical and logical argument and modeling to questions of economic interest on the one hand, and this social-political commitment, wanting to be a part of a movement of one sort or another that addresses itself to abiding questions of political import…wanting to be on the right side of history, wanting to fight for my people, quote-unquote, wanting to be relevant to the struggle, quote-unquote. So, the ivory tower – you know, the reason I didn't pursue mathematics as an undergraduate -- besides the fact that I entered a mathematics tournament with some other really, really smart undergraduate mathematicians, and I could not answer a single one of the 12 questions that were put to us as a part of the Putnam exam. I was completely dispirited by the fact that the winner that year answered five and a half – he got five and a half out of 12 – but consoled by the fact that the median number of correct answers on the exam by all of us contestants was zero. I was in that lower half of the population. But in any case – so it made me wonder whether I had the talent.
But the other reason that I didn't pursue mathematics was because it was 1970. It was 1972. It was 1974. And people were in the streets and the Vietnam War was raging and the United States controversy over that, and the Black Power movement and the civil rights and all of that, and social justice questions as they are now for young people were important to us then. And it just seemed a mile away from anything relevant to the urgent political moment to, you know, ensconced oneself in an ivory tower and to think only about something that 500 other people in the world would understand what you were talking about. So that gulf was there. Economics helped me bridge that gulf, because I thought, the questions of economics of the allocation of resources and of the valuation of things and of…what accounts for inequality and disparity and, you know, the implications of gains from trade and, you know, arbitrage and all this, opportunity cost… thinking about scarcity, thinking about people's choices, incentives, the design of institutions on all the questions of economics – are urgently practical questions. And yet the methods of economics – as I was beginning to study it as an undergraduate at Northwestern University in the early 1970s – are very heavily dependent upon analytical, mathematical, deductive, you know – even in statistics and probability theory and so on, you don't really get to the meat of things until you formalize and make clear how your assumptions relate to your conclusions and stuff like that. So it was mathematics, applied mathematics – but applied to society, applied to the questions of urgent significance. And I thought that was perfect. That seemed to me to be a perfect way to reconcile. And so I chose economics as my as my focus.
But still, I did struggle, in part over choice of problems. You know…as I say, I'm interested in race and racial justice issues. And it wasn't clear whether or not at the center of the discipline those kinds of questions were the ones that were going to get the highest payoff to a research program, and so on. And, of course, if you formalize, and if you make mathematical, the way in which you express yourself about the questions that you're addressing, your audience becomes restricted to the people who have command over those methods. So…there was always a tension – even in economics – for me, between my…interest in formalism and my desire to be relevant to questions of political significance.
Rohini [13:09]
When I first met you in 1992, I was struck by this disconnect I found between this wonderfully articulate professor who was in front of me…and there was all this, there was all this stuff about you in the in the media, people were talking about you being a conservative. And I actually never read any of that. But it was always sort of there in the background. And it puzzled me, because, in a sense, I didn't see someone who was a conservative in front of me; that was the real puzzle for me. I remember those first few weeks, you were teaching us this incredibly technical material on Markov chains, and ergodic distributions. And they were making the point that if you have to talk about poverty traps – if things were really a poverty trap – you needed pretty stringent mathematical conditions for that to occur; that it wasn't natural for someone to be born into poverty and stay poor. And this was really part of your…argument in the Econometrica paper as well, which has been really widely cited.
So to me here was someone who was incredibly capable, was engaging with issues on…inequality, but I didn't see as conservative. And again, you know…when you wrote on affirmative action, you talked about development bias and reward bias. And that, to me, has been an incredibly useful perspective in thinking about identity and inequality. So, did you feel that you were a conservative or did you feel that you were just labeled a conservative, or were you a conservative and were you no longer a conservative when you came to BU? I was always puzzled by that and I never really got the chance to ask you, So…you know, now I have it.
Glenn [15:02]
Yeah. Well, when I got to BU in 1991, I had already spent nine years at Harvard, where I came as professor of economics, and of Afro American Studies – they called it an Afro American in those years. And while I was at Harvard, I kind of evolved from a technical economist whose main interest was getting his paper into a top-five journal, into something of a public intellectual. I went to the Kennedy School of Government as a professor from the economics department. I literally resigned my professorship in the Faculty of Arts and Sciences at Harvard, and took up an appointment at Harvard – it was a lateral move within the institution – but I did have to resign as a member of the central faculty of the university to take up an appointment…at the Kennedy School. And I – there’s a long story here – and I tried to tell it in this memoir that's in process that will be published in the spring of 2024.
But…I had…an important crisis of confidence in my life as what I was doing as an economic theorist, and I just wondered whether or not I could really live up to my own very high expectation for myself and that discipline. And I was tempted. I was tempted – I’m answering your question…your question is, where did it come from in 1992, that people looked at me the way that they did. But it comes from the 1980s. And I'm trying to explain – I was tempted by
The…ease and the…rewards of people's accolades and the appreciation for the uniqueness of what I had to say, in the public intellectual sphere, because I was developing some doubts about the Civil Rights establishment’s narrative about the racial inequality problem. This is the 1980s; I'm at Harvard. I'm appointed in economics and in Afro American Studies. I'm having this crisis of confidence in economics, so I gravitate toward Afro American. And in my immersion in the Afro American issues, I begin to have doubts about the narrative of the Civil Rights Movement, which continues to be one of emphasizing discrimination. And I start developing essays and non-technical, general audience-oriented writing on the larger question of race. And my take is what you would have to call conservative. My take is, no, it's not all on the demand side, some of it's on the supply side. My take is, you know, the family's probably a pretty important institution, and the latter day cultural evolution that undermines the stability of family life might be a contributing part of the racial inequality. These are unspeakable things for many people, and I'm starting to say them. I'm alienating myself from the left and ingratiating myself – even in just in saying this – to the right, and suddenly the opportunity set changes for me. And I can get rewards and benefits and confirmation and affirmation along the line of developing this persona as a public intellectual, and exploiting this uniqueness of voice – which I sincerely believed in – but which also conveniently relieved me of the burden of having to confront my doubts about my potential as an economic theorist and giving me a pathway to a kind of professional success that I took. So I became a, quote-unquote, black conservative in the 1980s. So much so that I developed friends in the Reagan – the Reagan – Administration – the infamous neoliberal Ronald Reagan Administration – and so on. So that preceded me coming to BU. But it was widely known amongst people following political affairs, you probably not one of them in 1992, that I was this person.
Other factors, including personal scandal and all of that – I had to pull out of a government appointment because my young girlfriend and I had a fight that became public – it was, you know…we don't have to go into all the details here.
But…suffice it to say that I was a kind of notorious figure for many people center-left, who followed public affairs in United States who were interested in racial issues. And part of my coming over to BU in 1991 was explicitly that I made a decision that I was going to return my attentions in a full throated way to the questions I had drawn me into economics in the first place of developing analytical models that could shed light on important questions of inequality, opportunity, and resource allocation and so forth, which is, you know. what I did. And I had a wonderful time my first few years at BU. I published a couple of papers in the AER, I published in the Review of Economic Studies…you know, I was…on a roll there as…returning to my applied micro theory and was teaching that course on inequality that you remember so fondly. But that's what it was. They were there were echoes of that former persona of mine – Bad Boy Black Conservative at Harvard, widely known throughout the policy-focused domestic, you know, intellectual life here in the United States, who had come over to BU almost as a refuge. I mean, I wanted out of the spotlight.
Our mutual friend Debraj Ray, our mutual friend Dilip Mukherjee – these are some of my colleagues. Jonathan Eaton – I don't want to leave anybody out, so I'll stop talking after I mention Robert Rosenthal and Andrew Weiss and Michael Reardon and Larry Kotlikoff – oh God, let me not leave [out] mention[ing] Larry Kotlikoff. Anyway, it was such a good department in those years at BU. And I was having this resurgence of interest in and excitement about puzzle solving, modeling, doing economics, figuring it out, what's the game, what's the equilibrium, who's got the information, how do I express this important complex fact about the world in a formal framework that I could actually be able to deduce anything from it? By the way, we don't do, it seems to me…economic theory, quite that way anymore, you know. But anyway, let me not digress. I had a resurgence of my interest in economics at BU. And as a student of mine, in those years, you were a partly a beneficiary of that.
Rohini [22:00]
I want to go back to talking about institutions. That's interesting – it seems that BU gave you a certain space that you wanted at that time. And it also gave you intellectual stimulus that you needed through these wonderful colleagues. And I remember being excited; I remember coming in and taking Mike Reardon’s contract theory class and then your class and talking to Andy and having Debraj supervise me, and they were exciting years for me. I think it really made me who I am. And if it wasn't for you, at that time, I don't think I would have really done applied theory, because, you know, I thought of theory is something that I wasn't equipped to do. And it was your being there and really showing me that theory could be spoken in sentences. And actually, if it was good, you could always speak it in sentences. And that allowed me to go from the sentence to the algebra rather than the other way around, which would have just intimidated me. And so thank you so much for that, at the time.
But I want to talk about institutions and spaces, because you've been in so many. And often in elite universities, we’re in this trap of just thinking about the top five or the top ten as being the best, and so interesting that BU gave you the space, when actually Harvard pushed you out, in some sense, from the economics department to the Kennedy School. And so, reflecting back on that, how not just the loss of confidence that you felt at Harvard do you think was just a fact of being at Harvard at the time? And, you know, I remember you telling me about Thomas Schelling, who, who so inspired you. And he's inspired all of my work that I think is worthwhile. With Raji, for example. And he [Schelling] was such a mentor to you. I'd like to say a little bit about what he meant to you, personally, professionally. And also, I remember you're saying that he sort of laughed when you talked about this loss of confidence at Harvard, because, you know, you clearly didn't realize that everyone was feeling that. So I want you to take that personal experience into this broader discourse of how departments can both stifle talent and open up opportunities. That's sort of hidden by the by the ranking sometimes. You've been to a lot of different institutions from community colleges to Northwestern, Michigan, Harvard, BU, Brown now. Talk a little bit about which universities offer space and how they can offer space for development.
Glenn [24:52]
Okay, well, that's a broad set of issues. But I do think institutions matter a lot. Yes, my encounter with Boston University in the early 1990s, in a particular setting that was going on in the economics department, was personally very profitable in promoting my own development. And yes, my experience at Harvard in the early 1980s, when I came to the economics department was…not as good. And, yeah, my friendship with Tom Schelling, which came out of my move from the economics department at the Kennedy School – it was actually Tom who abetted that move. That was important.
I'm loathe to make broad generalizations about this institution like this, and this institution like that. I'm sure that even within schools, there will be variation in the extent to which the climate of pedagogy and sort of…research focuses good or bad for developing young people. One problem at Harvard was that it was so elite and so exclusive, and so each little tub on its own bottom professor had her or his own global empire of connections and interesting people are always on the move. And, you know, it was hard to bond, it was hard to find time to actually talk to anybody. I felt in the early 80s – I don't know what it's like in the department now – but I felt completely alone. And I don't think anyone meant any harm. I just think it was…it was the way that it was. Everybody was busy and everybody was on the move…it wasn't warm. It wasn't cuddly. One had to have a tough skin and be focused and know exactly what you wanted to do, and so on. And it was in that environment that Tom kind of took me under…his wing. And as we became friends, yes, I did go to him and I told him I was panicked. I didn't know if I'd ever write another paper, whether it was worth a darn, and that, you know, I didn't know if I was cut out for this, you know, rarefied, you know, thing that was economics at the very top where everybody at the faculty meeting table was famous. I can remember the first faculty meeting I went to at Harvard economics. I'm a senior faculty member; I'm a full professor in the department. And I'm looking around the table at all these people. And every single one – oh, so that's what she looks like, that's what he looks like - I mean, every single one of them was famous. And what am I doing there? And I confessed this to Tom and I, you know, woe is me, woe is me. And he starts laughing. And he says – and I didn't…see anything funny and all about that – and he said…’cause I'm confessing my soul and…you know, it took me like a couple of weeks before I got the courage to go in and tell him this. And he said ‘You think you're the only one – this place is full of neurotics’ – which, by the way, is why they're never in their office and always on the road. And if they're in their office, they're hiding behind a secretary and you have to have an appointment a month in advance to see them because they absolutely, absolutely have to get this grant, have to get this thing…have to you know…they're never satisfied. There's no, you know…you're always looking over your shoulder, they're still coming on up, gaining on you, you know, you gotta keep running. He laughed. He said, everybody…these people are…it's a bunch of neurotics around here living in fear of the dreaded question: What have you done for me lately? You know, you can't rest on your laurels; you can never rest. And he told me,
‘Just relax and do your work.’ And that was that was a salve. That was very necessary to get me to chill out a little bit – but I still moved to the Kennedy School the following year.
But institutions. I just want to say this about Boston University in the years that you were a graduate student there. And it was because of the skill of Larry Kotlikoff as the entrepreneurial chairman of the economics department. And the vision, I must say, of John Silber. He's a controversial man, the late John Silber, who was the president of Boston University in those years, who built a great university out of a streetcar college on Commonwealth Avenue. He made it into one of the go-to places on the east coast of the United States in the 20, 25 years that he was at the helm of BU. And this experience in economics for me…was a part of that. It was a part of Kotlikoff’s…chutzpah and energy…and Silber's vision and willingness to marshal the resources to create almost out of whole cloth a first rate, you know, top 15, top 10, even, arguably, economics department when I was there. But I don't know am I addressing your question, Rohini?
Rohini [29:42]
Yes, yes yes. Because I think what you're saying, which I think makes a lot of sense, is you can't just think about the institution. You have to think about that particular moment in the institution. And it's, also, you have to think about the person and the institution. And it's really all about a fit. That's one thing I hear you saying. And the other part I hear you saying is that, you know, these institutions that are talked about a lot are very high pressure places. And so part of what you have to deal with is dealing with the pressure, dealing with you know, how to keep your self-confidence up enough to actually focus on your intellectual goals. And so I think you are answering that question, Glenn, thank you.
Glenn [30:25]
Let me mention one other thing about institutions as we think about it. And I talk about this in my book – forthcoming in spring of 2024, which I am tentatively calling The Enemy Within, but which my publisher is saying, ‘That's not a good title, it’s too generic, we have to find another title.’ So you don't know the title of this book yet.
But in any case, institutions. MIT in the early 1970s, when I was a graduate student, 20 years before you and I met, was a pretty special institution. And in fact, the contrast with Harvard was notable. I was advised by my teachers as an undergraduate coming out of Northwestern University, to avoid Harvard's PhD program. If I got the opportunity to go to MIT's PhD program instead…and I didn't get the opportunity; I was accepted at both. And I chose MIT. And there – the kind of isolation that I felt at Harvard when I was a faculty member there, ten years after I entered MIT as a graduate student – is inconceivable because the culture of that institution, MIT's economics department – I speak in the early 70s, but I'm sure it's been characteristic of MIT throughout the history of that great department – was one in which open-door graduate student access to professors, collegiality, a kind of unpretentiousness, no prima donnas kind of attitude. Retire when you get to be 70, even though you still might be writing papers, because you don't want to take up too much…this kind of attitude is characteristic of MIT.
MIT, in the early 70s…they would admit 25 or so graduate students each year, and they created three additional slots for black students in the United States in the early 1970s. I occupied one of those slots – it’s pretty likely that I would have been admitted with or without that program, because I did very well as an undergraduate. But that's neither here nor there. The point is, at that early stage in the development of a post-Civil Rights kind of sensibility in higher education, that MIT economics department was out front and trying to encourage the development of Black talent. So, that was a different culture, that's all I'm saying. And I attribute…in the case of MIT part of that to the fact that the department grew out of Paul Samuelson's not being – when he emerged in the 1940s, as you know, one of the great economist of his generation – not being afforded an opportunity to, you know, ascend to a chaired position at Harvard, largely, I think, it's plausible to say, because of anti-Semitism in the Ivy League in those years – and moving down the road to MIT and setting up a department there with him and Bob Solow, which grew through the 50s and the 60s into arguably the best department in the world. And that culture – self-consciously outsiders, bucking the system and trying to, you know, focus on economics and be as smart or smarter than the next guy. And with your sleeves rolled up, you know…nobody walking around in three piece suits, you know, primping and whatnot. Everybody, you know, ‘What have you done for me lately and yeah, what's the solution to the problem?’ I mean, you know, that kind of culture was characteristic of MIT. And I benefited a lot from that as a developing scholar. So culture of institutions matters.
Rohini [34:03]
It's just hard to make generalizations.
Glenn [34:06]
Yeah, I think so.
Rohini [34:08]
I want to talk a little bit about your thinking on race over the years. And I was particularly struck by this evolution, when you think about the big papers. So, if you think about your affirmative action paper with Steve Coate in the 90s, and then culminating in the Dubois lectures and The Anatomy of Racial Inequality, which is such a powerful monograph. And what I'm struck by is really a humility, Glenn. I know that you're not thought of as a humble person. And this is…part of why it's so fun to talk to you because I think people just see you in so many different ways. And I've always felt that I can just say to you whatever I think. I can disagree with you. I find you listening to me and yet, you know, that doesn't always come across. And it brings me to this broader question of economists within the discipline. I mean, we're often thought of as arrogant, of taking big ideas and sociology, psychology, and then sort of dressing them up with with math, and then presenting them to the world. And…then getting… accolades. And so, I was struck in that book on how you start by talking about statistical discrimination and taxi drivers in New York, and how, even if there was no difference within populations, you could generate this difference. And then to me, in that book, you ultimately come to this notion of stigma, which you then can't put a model on, you can't really characterize it. And the reason I say it was…a humble position to take was because here you are – you can do the math, you've done it all these years, you've showed the world that it can actually be useful in thinking about race – and there you are saying that look, ultimately, I don't think this gets at the problem. And I don't really know how to model it. And I think that if people really read that book…they would not think of you as someone who is not open to the discipline. All the references that you bring in, the wide scholarship that you cite. It's really saying that, ‘Look, we have a problem here that we have to understand together. And I'm not saying I have the answer. I'm just pointing to some of my observations.’ So I want you to talk about that transition a little bit, from discrimination to stigma, if you want to call it that.
Glenn [36:47]
Yeah, I do want to call it that. And thank you, thank you for such close attention to the argument of that 2002 book, Harvard University Press, The Anatomy of Racial Inequality in which I actually…it’s based on the lectures I gave at Harvard, the Dubois lectures I gave in 2000; the book was published in 2002. And I juxtapose the concept of stereotype with stigma. And I'm talking about race, I won't try to recapitulate the entire argument. But it's true that there is a different tone…a kind of different level of specificity and kind of formal coherence to the stereotype argument that I make. It's a…statistical discrimination argument. It's a self-fulfilling prophecy kind of argument. Again, I won't try to recapitulate it. But the basic idea is that beliefs, on one side of a market, and incentives for action, on the other side of the market, are related to each other. Employers have beliefs about groups of workers. Workers have incentives to acquire skills. And those interactions can have interesting, perhaps anomalous consequences, one of which is that if populations are discernibly distinct one from another, like Black and white in a multi-racial setting, even if the populations in their fundamentals – in terms of the distribution of abilities and preferences, and so on – are similar, employers can end up believing differently about the populations and as a consequence, creating incentives that induce behavior in those respective populations that confirm the employer's different beliefs. And so we get inequality almost out of the air, almost out of the ether, but it's about incomplete information and about the consequences of people in games that interact with each other under complete information with beliefs and incentives being interrelated, coming to the kind of outcome that I describe – an outcome of inequality, even though the groups are not fundamentally distinct. So that idea is an economics idea. It's, you know, Kenneth Arrow…would be among the people, my predecessors…great man, the late Kenneth Arrow, who tried to formally model this. And Steve Coate and I develop, I think, you know, a very useful apparatus for formalizing this kind of thing that I was just describing in words. In the stereotype chapter of that book, I described that way of thinking.
But I actually got asked a question by William Darity, Sandy Darity, who was a colleague of mine when I was a graduate student at MIT. He is a left-of-center, prominent…Black man who's a economist at Duke and a prominent economist, whose politics are different from mine. But, with respect, he once asked me a question about statistical discrimination models that really stuck with me and it leads to the stigma part that you've made reference to which I acknowledged as less formally developed in my thinking and perhaps less amenable to formalization. But in any case, he said – Sandy did to me, he says – ‘Oh, so you got one of these statistical equilibria where there's self-fulfilling prophecies and the Blacks are on the short end – how come nobody experiments and learns about the fact that it's a statistical discrimination equilibrium, which is a kind of artifact of self-fulfilling prophecy and that it really is not indicative of fundamental distinctions between groups. People don't experiment, they don't learn in your world, in your and Kenneth Arrows’s world.’ This is Sandy. He's contemptuous a little bit of neoclassical economics. So he takes the opportunity to take a shot. And I never took that question very seriously when I was a graduate student, ‘cause Ken arrow is Ken arrow, and Sandy Darity is Sandy Darity, and never the ‘twain shall meet no…disrespect intended, but come on, that's Ken Arrow. I didn't take it as seriously, I think, as I should have, because actually, the formal framework – you know, we postulate a game, we say people have the information that they have, and they formulate beliefs or rational expectations and whatnot – doesn’t admit of really – maybe people have advanced to the point where they can do this now, I don't know, but not to my knowledge – to the kind of treatment of learning experimentation. And I actually developed the view – and I tried to articulate it in the book – that…there's some stuff – I was very impressed by this sociologist I read. His name was Barnes. Barry Barnes. He’s a Brit. And he says, ‘How does a baby learn language? Is it rational?’ And he says, ‘Well, it can't be rational, because rational presupposes that the baby has the capacity to formulate thought.’ He says that there's a there's a sense in which fundamentally, it's conventional, that is, the baby learns language by being embedded within a network of social affiliation and assimilating itself as a consciousness into that network by the acquisition of language capacity, and that to try to make that rational all the way down is a fool's errand. And I thought, that's a that…seems to be putting his finger on something really, really profound about the limitations of our, sort of, imputing to the agent a kind of rationality that makes their behavior necessarily the consequence of deductive reasoning. And it's exactly that framework that's employed in the stereotype theory, the multiple equilibrium, self-fulfilling expectations theory that I developed in the…previous chapter and that Sandy was raising his questions about. And that made me think, okay, so how does that apply to race? And I was influenced by some of these sociologists.
Orlando Patterson is another one. His book Slavery and Social Death, which is a monumental achievement, published 1982. Again, Harvard University Press. It's a survey of the institution of slavery from antiquity into the 20th century, with deep exploration of slavery in Sub-Saharan Africa as well as slavery in the Americas of the captive Africans, and slavery in Byzantium and slavery in the Orient, and slavery in Istanbul in 1600, and slavery, you know, in Greece, and Rome, and so on. So it's a great achievement, this book. And he has a theory of slavery, which I thought relevant to the discussion of racial inequality in the United States because of our history. And his theory postulates that slavery is fundamentally about dishonor. It's about non-personhood. It's about the capacity to categorize and see people and not accord them standing, in some way. He thinks natal…what he calls natal alienation is a fundamental part of what is at the essence of slavery, when natal alienation means across generations; the progeny are alienated from their forebears by the intercession of the master’s property claim, so that the baby is a property of the master rather than being issue that, you know, comes through the familial line.
And he has other very, very interesting things to say. He says, you know, an athlete who is owned by a sports team can't ply their trade without the forbearance of the guy that's got the contract – is not a slave, although they do not own their labor in some literal sense, because they don't suffer the same degree of social alienation and dishonor. And I…I'm sorry, I'm taking a long time to say this, Rohini, but we're in the long form, podcast format, so I can I can do that. Thank you. The thing about the importance of this perception of honor being critical in thinking about slavery, and slavery being critical in thinking about racial inequality in America, and thinking about…the stigma of that being critical for understanding the persistence of racial inequality, and seeing that it's something that lies outside of our capacity to formally model, is that if slavery is not simply property and people, but instead involves this kind of hierarchic relationship of social status and of meanings, then emancipation is not simply a legal act where the authorities – Abraham Lincoln in the case at hand in the United States, but anyway – pronounces these people are no longer property they have been freed. Well, yes, you can abrogate the contract. But you don't erase the dishonor for having abrogated the contract. The contract rested in part on a social convention of dishonoring people based upon their African descent. And that did not get reversed. When you abrogated the contract – that still was lingering there. That was the stigma that I was making reference to. That was the thing that keeps people from experimenting and asking questions about their interactions with others when these seemingly irrational and certainly inefficient statistical discrimination equilibria emerge. And Sandy is asking a good question when he asked, ‘Why don't we interrogate this framework? That was part of what it was that I was trying to point toward. And I'll stop. But I'll just say: read sociology, whoever is out there.
Mike Gaetani [46:15]
You just tweeted within the past week about your 2016 – January 2016 – public symposium at CASBS, which was sort of the launch of your memoir project. And there was a mantra throughout that talk – and I'm just gonna paraphrase it – you were saying several times, ‘What's a good upstanding Black intellectual to do?’ And you asked that several times throughout – what’s the black intellectual to do about the persistence of racial inequality. And that's been a through line. And then you a few years later in 2020, appeared on a CASBS webcast, and that was the title of the episode, “The Persistence of Racial Inequality.” And the conversation revolved more or less around an essay you wrote for the Manhattan Institute. And it was a great panel involving Josh Cohen and Frank Fukuyama and Alondra Nelson. I just want to know: now, in 2023, on the persistence of racial inequality, how do you feel? Do you feel that the needle has been moving?
Glenn [47:19]
It's a deep question for me. And one that's a little disquieting, actually, ‘cause it kind of gets into the psyche a bit. You know, we touched on this at the beginning of the conversation with Rohini, that, you know, the conflict between the science part of it and the…public, you know, the role that you play in public politics and public policy. Wanting to be a good Black economist, helping the situation of my people, on the other hand, and also wanting to be a respected technical social scientist who practices economic theory at a high level.
But when you, you know, get down to a question like incarceration – which is, by the way, the subject that led me into this self-accountability reflection that issued in my asking the question, What is a self-respecting Black economist to do? You take incarceration. So, it's crime, punishment, policing, law and order, deterrence, incentives. Should you outlaw drugs. What's the role of poverty and neighborhoods. What are the root causes of crime and whatnot. You can't get away from the racial disparity and the application of the punishment in the society, I mean, blacks are 10, 12% of the population; we’re 40, 50% depending on where you look and how you count of the people who are being locked up. And, you know, that…there's a visceral sense in which that fact – when I gave the Tanner Lectures on Human Values at Stanford in 2007, the great French sociologist, Loïc Wacquant, who's a professor at Berkeley and in Paris, and a protégé of Pierre Bourdieu – you see, I do read sociology – flew overnight from Paris to be able to be present to comment on my Du Bois lectures because he was lecturing the day before. He was half asleep as he stumbled through his presentation but, fortunately, he had written his remarks down and they are included in the comments in the volume on those lectures (that was published by MIT Press) of mine called Race, Incarceration and American Values.
But anyway, I'm saying all that to say, why did Loïc get on a plane in Paris and fly to San Francisco just so he could comment on my talk before he had to get on another plane and fly back? Because a Black intellectual of real prominence and distinction was addressing himself full-throatedly to the incarceration problem in a way that Loïc, in 2007, lamented hadn't been done. I'm not going to name names because…but if Loïc were here, he’d be saying, ‘Why didn't so-and-so give this lecture? Why didn't so-and-so…finally somebody's giving, you know…. And when I gave the lectures, I asked the audience in effect, What am I to do up here? I had a photo of…an African American and dreadlocks with jail bars behind him at a window, and a bird representing freedom visible through the bars, but him longingly looking through the bars out to whatever…and he's a criminal, and he's being confined and he's a thug, quote-unquote, and he's one of these people that we are going to protect ourselves from. And he symbolizes the marginal status of the hundreds of thousands – indeed, over years, millions – in ghettos in cities around the country who end up on the wrong side of the law and then behind bars. And who speaks for them? And shouldn't I speak for them? What is a respectable Black intellectual to do?
And if you combine that with the fact that the things that you have to say may not line up with whatever the latter day ‘fad and fancy’ tells you that a thinking person is supposed to say. You might end up saying it's not structural racism, and that that's a silly pipe dream dead end, talking about something as abstract as structural racism. It's, what are his peers doing that he comes to value that leads him to make choices that end up with him being in a fix? I'm putting it very, very starkly. I'm saying, on the one hand, attribute the morally objectionable and socially pathological outcome – over-representation of blacks in prison – to the system that denies opportunity to the person. That is, of course, a very appealing progressive posture. Or, consider that each and every one of us is personally responsible for…we exercise discretion over the things that we control. And, moreover, maintenance of order in the society is not going to be possible unless you hold people responsible for the actions that they take. And, that the incentives your response to this condition create will either help to ameliorate it or will give people reason to double down on what they're doing. And, so, as an economist who bears bad news, I'm here to tell you: Black Lives Matter have got it wrong! That was the alternative argument.
This is all hypothetical, people. I'm not actually taking a position; I'm describing the dilemma of the Black self-respecting economist and what is he to do. Is he to decide with his people in the fight for justice in a form that his intellect tells him is woefully incomplete for capturing the subtle complexities of the situation? And I have had, throughout my life, to make that choice.
Rohini [53:26]
One of the striking conceptual distinctions that you made was on problems of contact versus contract; it was just so beautifully put. And I think you came to the conclusion that the problems of racial inequality are problems of contact and not primarily of contract – that we've made…progress on the contract fund, but we really need to make progress on the contact front. And I want to move that discussion a bit forward, and end with us [economists] and the other social sciences again. Because where does that put us? What we're good at is the contract stuff at some level. And if we have to reinvent ourselves – if we have to speak to the others, and have to really bring in their insights, and yet contribute in the way that I think economists really can contribute. We think about strategic behavior. We think about equilibrium. We think about aggregation, very importantly, and Tom Schelling is the one I would really thank for bringing this into the discipline. He moves us from micro-motives to macro-behavior, and shows us that that link isn't at all obvious. So I think there is a lot we can contribute. But in some sense, I'd like to go back to the title of the essay you wrote for the co-edited book that I did with Danielle Allen, Difference Without Domination. And your chapter was called “Relations before Transactions.” And I want you to say a little bit about how you think we, as economists, should start that project. I think it's really a project we need to begin; I don't think it's a project that's underway. Or if it is, it's far from…it's still in adolescence or, you know, childhood – we still haven't really developed that idea. How should we go about it? And how should we talk to the other social science disciplines? We're living in a very polarized world, Glenn. And I think we can't do much about a lot of the political polarization. But I think if we had less polarization in academia, I think that would at least allow us to fulfill our purpose as public intellectuals better. How should we go about it with the wisdom of all these years? Help us get started.
Glenn [55:51]
Oh, you put me on the spot, now. Let's see what I can do, though. I think…humility, you know…I mean, understanding the limits of our discipline, and…being open-minded, and listening, and all of that. I think, you know, humility. I think, a breadth of interest. I think, read widely, and this kind of thing. And I don't know that the culture of our profession – economics, academic economics profession -- admits enough of that: of encouraging a breadth of intellectual interest in our charges, so that they grow through the course of their professional careers and become, you know, not…just adept practitioners of the particular craft, of, you know, model-building and statistical inference, but real thinkers who engage with society, with the problems of society, broadly, remembering that we're a social science – we’re not statistics, although we use statistics; we're not mathematics, although we use mathematics – we’re a social science. Read the history of economic thought. Read some of these classic – read Ricardo or read Smith – or read Marx! You know, argue with him if you want to. But…the thinkers…read Keynes. Read…Marshall – I’m for reading Marshall. I don't know if anybody even knows who Marshall was…nowadays, you know. Read John Robinson – I don't mind engaging the Cambridge capital theory argument, or whatever. There's a lot of stuff to read. And if you take yourself out of the small world of…technique – important; it's very important, but it's a relatively narrow berth – and you…put yourself in the shoes of somebody sitting in 1850, trying to figure out what the terms of trade are supposed to be and why. Or trying to figure out whether a bridge is worth building and how you’d even pose the question in a meaningful way and then answer it. ‘The areas under these curves actually have welfare significance,’ or something like that. You put yourself in the position of these people thinking about well, what could determine the terms? I'm thinking of Irving Fisher right now, or whatever, or Paul Samuelson, some of the great, you know, epic kind of engagement with the…economics of public goods and how to frame and whatnot like that. I'm sorry, I'm rambling. Read widely. The…questions are not, at the end of the day, about technique. The questions are about social life and about what happens when we put people together in a system of interaction, and so on. So…I know that I have not answered, ‘How can we facilitate the development of economics in a way that's congenial to and knowledgeable about what it is that other disciplines have to offer?’ I think…the answer has to lie in pedagogy and what we teach our students and how we encourage them to develop their intellectual gifts.
Rohini [59:02]
Bringing us back to the world of policy, and how do we offer education to everyone, rather than just to a select few. And here I want to go back to your conceptual distinction between reward bias and development bias. And the question is, really, how do we encourage development? How do we remove development bias? And one thing that's talked about a lot in politics these days is the unaffordability of a college education. And you've been through many institutions, you haven't just been to the very elite institutions. You've been to community college. You went to community college, and then you went to Northwestern. At a time when you were a young father, you had a job, full time job, and you've seen a lot of different people in a lot of different places. If we are really to make opportunities widely available, do you have thoughts on how we might do that, in terms of changes in educational policy, the educational infrastructure? I know, that's a big question. So just pick any part of it you want. And then, you know, we’ll end there.
Glenn [1:00:17]
Oh, well, when I think about my own development, it's true that I was a college dropout. And I was in college and…my girlfriend became pregnant and we married. I dropped out of school and went to work. I was working at a factory. And then I started clawing my way back into academia. And the first step in that process was a community college. And it was absolutely transformative for me. It was basically free. I mean, I think a couple-hundred dollars a year or something. In the late 1960s, it was pretty high quality. I had a calculus teacher who was a former engineer, Mr. Andres – who had retired from his job and was taking up teaching calculus. And he was really quite good as a pedagogue and knowledgeable about the applied mathematics of it – who took a liking to me and encouraged me and then ultimately referred me to Northwestern, where I ended up getting a full scholarship. But Community College was important for me. I think, based on what I hear from people who study these matters more closely than I do that, the proliferation of community college as a avenue for personal development – with the idea that people would go for a couple of years as I did, and then transfer to a four year institution, as I did – it’s not for everybody. And that a lot of the young people coming along, don't really have the skills of you know, quantitative and verbal reasoning that makes a kind of college path nearly as plausibly sensible for them to pursue in terms of resource allocation, likelihood of success – as because the completion rates for four year for these kids are not as high as you would like them to be. As might be the case, if they were to instead divert into vocational education and acquire some kind of skill that will allow them to work at some craft or something like that. So if we're talking about for the everyman, for, you know, the…kind of median person, I'm not sure that a four year colleges is…the path for everybody. But, again, I speak only based on my familiarity with the thinking that some people who are more knowledgeable about the question.
I mean, I could opine about education. I could talk about the importance of early childhood and neurological development before young people even get to the formal institutions, and how interventions of a variety of kinds that have been tried around the world, direct themselves to that set of issues. I could talk about the provision of educational services by public institutions in the United States where there are real big policy debates going on about charter schools and the choice matrix for parents in terms of where their kids get educated, and they influence a public school teacher unions and so forth that are arguable – and I'm not trying to pick a fight with anybody – I do have views about those matters. But they're less important than just calling attention to the fact that the vast bulk of the population, K through 12, quality is a key issue and that there are places where…the outcomes are not so great. I could talk about parenting and culture and all those kinds of things, which are unspeakable topics, if you address yourself to inequality, because they seem to be blaming the victim. And I don't, I don't think it's necessarily so…
Rohini [1:03:57]
Just to interrupt you, Glenn. One particular question on this is there have been a lot of programs which actually tried to improve opportunities for children living in poor neighborhoods. The Moving to Opportunity program is an example of that. And there's been a fair amount of empirical work now, that shows that has good effects in the long run. Raj Chetty has done a lot of work and others. There's also been a lot of talk about charter schools and voucher programs. And how do you feel generally about giving a few promising children opportunities and then tracking them rather than raising the overall quality of…public education? Do you think there's a tension there? Do you think the rhetoric of providing opportunity to a few has distracted us from trying to really build quality public education K through 12? What's your view on that?
Glenn [1:04:48]
I think it's a hard problem. So it comes up, for example, with you know, the selective tracking…of gifted and talented…you know, where people are saying no. It comes up in the charter school debate because there's a cream-skimming allegation of charter school. Providers deny it. They say we're just peeling people off of a waiting list. But you can't help but notice that the parents who were most proactive in their children's lives, most resourceful, and so forth are going to be the ones to our first in the line to get take advantage of the... So even if charter is providing better services to the kids who are lucky enough to get access to it, it might end up diverting resources away from the system, which is a system of last resort for other kids. And so there's, I think, there's a unavoidable conflict in that. There's clearly the conflict in terms of race diversity of ‘Do I maintain, let's say, in a selective university, a high standard of admission that relies on standardized tests to assess students’ suitability, when I know that because of the history of developmental disadvantage, the populations of color may be underrepresented amongst the kids who have the best chance of doing well at these instruments of assessment and therefore they will be underrepresented amongst those who are selected.’ And, hence, the pressure is to, in one way or another, relax reliance upon instruments of assessment that can be presumed to disadvantage the kids who are in the population that you most want to help. And that, I think, inevitably pits a kind of maintenance of standards and a kind of commitment to elitism and meritocracy – not inexorably, but I think that tension will be there against the kind of egalitarian sentiment and a desire to open up institutions and access to others. And I think…that's a very hard and a very important problem.
And you can get it wrong in both directions. You can get it wrong by being completely indifferent to the fact that large, identifiable segments of your population are going to be underrepresented because you're using, you know, let's say a standardized test for admission, and they're not doing well on it – and they're not doing well on it well may be a signal of the fact that at this point in time, they haven't acquired the mastery over the material to the same extent. But it may also be a reflection of the of the deeper structural conditions in the society, which you are now ratifying by relying upon this entrance. That's on the one side, but on the other side is a desire to be egalitarian and inclusive that causes you to issue any reliance upon differentiating information, and that…kind of waters down your program, and it's a kind of road to mediocrity and a loss of the edge of…innovation and…competitiveness. And this is, of course – isn’t it one of our conundrums here, because we're decent people, we economists, but we also know that incentives matter, and everybody can't win the race. I mean, if I have a race, I'm gonna get kids to run faster, because everybody wants to be in front. But then, by definition, somebody's going to be in front and I…can't help but induce a certain amount of disparity in outcome if I create an institutional framework that encourages the effort in the first place. It seems to me this is…what makes it interesting. You want to analyze the trade off, and so on and so forth. But, yeah…
Rohini [1:08:20]
So I think that…we've come to something, maybe not intentionally, but we’ve really come to, I think, what the discipline has to offer. As economists talking about these issues, I think we've realized that we have to listen to others. And then, ultimately, what we have…the best we can do is start off with this position that ‘We don't know for sure.’ But we have a set of tools with which we can think about this. And when we use those set of tools, what we come to is a set of if-then statements, which show how the context matters. And maybe that's all an applied theorist can really do. But I think that is probably useful. I think you and I probably agree that that is useful, or we'd like to think so.
Glenn [1:09:07]
We do. We do agree, we do agree. But we are talking to a general audience, I assume, so everybody knows the ‘dismal science,’ you know, thing about the economist, you know…and we're the bearer of bad news. And…I think that…is at the heart of the matter. I'm from Chicago, home to the University of Chicago school of economics, although I did not study there. But I'm from Chicago; I grew up a stone's throw from that great institution. And there is no free lunch. You know, I mean, I'm thinking about the idea that scarcity imposes constraints on us, okay. I mean, the constraints are real; they're unavoidable. There's a kind of romantic impulse in people who want to do justice, to ignore the constraints and, unfortunately, it falls to the economist often to be the bearer of the news that ‘Well, no, the constraint is actually there. You can't do everything. There's no mana coming from heaven. Everything, you know, has its…opportunity cost,’ and stuff like that. I think taking that kind of an insight and using it to uncover implications that are otherwise not apparent to the…naked eye, I think is one of the things that that we do well. So I don't know if I said what you said – I agreed with what you said. And I tried to amplify it.
Rohini [1:10:37]
Thank you so much, Glenn. It's just been just a pure pleasure. And thank you very, very much.
Glenn [1:10:44]
Oh, Rohini, thank you for your interesting and probing questions – and for your friendship over all these decades.
Narrator [1:10:54]
That was Glenn Loury in conversation with Rohini Somanathan. As always, you can follow us online or in your podcast app of choice. And if you're interested in learning more about the Center's people, projects, and rich history, you can visit our website at casbs.stanford.edu. Until next time, from everyone at CASBS and the Human Centered team, thanks for listening.