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I know what you’re thinking – “we don’t want an email we want £10,000”. Well life’s full of disappointments – so an email it is….
But to help distract from that let down, this week we’ve got short pieces on how the gender pay gap starts young, robots winning and a nice game from Zoopla to help us panic about the housing market in a fun way.
And for those that like to get behind the headlines, you can supplement the reading below with 78 charts and loads of policy suggestions to make Britain work for old and young alike in the Intergenerational Commission’s final report – download the book here.
Bad babysitting. The gender pay gap is often partly put down to the fact that men are more likely to negotiate a pay rise. But in a blog drawing from her new book, Yasemin Besen-Cassino rightly notes that the danger that this argument can implicitly (and wrongly) put the blame on women by assuming that negotiating would have the same benefits for them as it would for men. And she’s got an interesting experiment to prove her point, looking at gender pay gaps among working teenagers – a good age-group to study as they lack the baggage that gets in the way of identifying discrimination in the labour market. Her conclusion: we’re more likely to give a male babysitter a raise because a young women asking for one makes us think she’s disingenuous about the emotional labour we implicitly expect women to provide. Pay your babysitters fairly, people.
Housing bubbles are bad – who knew. It’s always nice when some very complicated modelling reinforces what you already thought – it’s group think with added maths. A new Richmond Fed working paper has been making waves recently by showing that a housing bubble is very bad news for those just wanting a house to live in, as those with cash pile into the market and raise prices. In the real world, and back on this side of the Atlantic, the findings are one part of what is going on when generations that are more likely to be borrowers (the young) lose out from our post-1990s house price surge – millennials are half as likely to be homeowners at age 30 as baby boomers were at the same age.
More robots, less pinstripes. Last weekend Warren Buffett’s Berkshire Hathaway held their annual general meeting in Omaha. A hot topic was the bet he made back in 2007 that putting money in an unmanaged investment fund would, over 10 years, outperform even the most star-studded professionally managed hedge fund – that robots could do better than men with expensive tastes in dubious pin stripes. He was right – this table from his latest annual shareholder letter (h/t Timothy Taylor) shows just that: simply following the stock market automatically delivered returns of 125.8%, while the professionals you could pay to do it for you made returns between 2.4% and 87.7%. We can learn to love some robots.
Warehouses of the future? Ocado has a new warehouse in Andover that’ll soon be processing 65,000 orders a week – that’s a lot of avocado. The thing looks like chaos – out has gone the standard linear production line, with products placed in a seemingly random order while a swarm of robots lifting, move and sort – sometimes in cooperation with each other – 24 hours a day. Humans are there only at the beginning and at the end, to unpack incoming goods and pack the outgoing ones. Change is coming people – not least if we’re on course for a big shift in the availability of low skill migrant labour.
Ageing and inflation. There’s been a lot of inflation angst around in the last decade, although people are never quite sure about whether to worry about it being too high, or too low which rather adds to the angst. Lots of the focus on inflation has been about the link to our wage packets, but a new paper returns to an older argument about the link between an ageing society and inflation. Using long-run data from 22 rich countries since 1870 the authors find that having a larger dependent (old and young) population means higher inflation (except when we get over 80), whereas an increase in the working age population works drags down our inflation rates. The implication is that clever central bankers should get less of the credit for falls in inflation in past decades – and that shifting birth and death rates did more of the work…
Location, location, location. This one’s a bit different – a bit of light relief for your quiet Friday afternoon. Courtesy of Zoopla, the property price game tests your prowess in valuing pairs of houses. Hint: however nice the property might look, its price is all about where it’s built. A good one for the doubters about the need to reform council tax that hits poorer areas hardest…
This week’s chart: the stegosaurus chart… The distribution of wealth was a major theme for this week’s Intergenerational Commission. This chart is good because it’s pretty, but also because it shows how wealth gaps have grown between AND within generations in recent years. Small twiddles aren’t going to sort the impact those kinds of shifts have on society.