Is an Academic Career Still Worth It?

Being a professor is still great, but the alternatives are getting better fast.

I’m glad I started a PhD in 2009; I wanted to learn more economics and the opportunity cost was low, with the worst job market in a generation. When I went on the job market in 2013, I still thought academia was such a clear favorite that I didn’t even apply to private-sector or government jobs. I wanted to teach, yes, but above all I wanted freedom- the freedom to choose my own research topics, to think deeply, to not have a boss, to not spend 40+ hours every week in an office.

It’s easy to find essays about how academic jobs are terrible, or at least much worse than they used to be. To me, being a tenure-track academic is still great work if you can get it, for all the reasons Bryan Caplan explains here. But I do think the quality of the job is standing still while the alternatives get better. The academic superiority that seemed obvious to me in 2009 and 2013 no longer seems obvious in 2021, due to three big changes:

Higher Demand: The demand for workers with quantitative and/or programming abilities has never been higher. My impression is that now anyone with the ability to do a PhD in a quantitative subject could be making six figures in tech, data science, or finance within a few years if they set their mind to it. Of course, this is simply a difference of degree; its always been the conventional wisdom that you could make more money outside of academia. The gap seems to be growing now, but to me the more important change is

Remote Work: Quality, high-paying remote jobs have gone from rare in 2019 to common today, which is a game-changer for many decisions, including academic vs non-academic. Perhaps the worst part of an academic career is that it forces everyone to move- getting a PhD usually requires moving, and getting your first academic job almost certainly does. This is a huge cost for those who value family and community, a cost many people are unwilling to pay. In 2014 my wife’s career had just brought us to New Orleans, but the closest tenure-track job offer I had was a thousand miles away at Creighton University in Omaha. I took the job and spent the next three years flying back and forth, partly because I wanted to be in academia, but partly because there were no good private sector or government options for an Econ PhD in New Orleans either at the time. Back then the private sector and government economist jobs were plentiful but generally meant moving to one of a few cities (DC, NYC, SF, Boston) and spending all day in an office, so I ignored them. Today I wouldn’t.

Campus vs The Internet: So the practical side of non-academic jobs is getting better, but what about the life of the mind? When I first went to college I loved taking classes in new subjects and going to the events and seminars that were always happening on campus, and part of the appeal of being a professor was to be able to keep doing that. In graduate school I liked attending the seminars where visiting speakers would present their latest research, and hoped to get a job at research-oriented university where I could keep doing that. But these benefits of being on campus don’t seem so important anymore. Partly its that I feel too busy to take advantage of them; most of the time there’s a speaker on campus talking about something cool like a new translation of the Odyssey, I’m either catching up on work or home with my kids. But mostly the internet means this sort of thing is available to everyone all the time. I may have missed Emily Wilson’s talk at my campus but I heard her on Conversations with Tyler. I’m not at an R1 school with scholars in my field presenting new research every month, but there are now more great research seminars online than I have time to watch. The Internet makes it increasingly easy for anyone with the motivation to participate in the life of the mind regardless of where they live or what their job is- certainly as consumers, and in a future post I’ll highlight the increasingly impressive scholarly production coming from non-academics.

2021: Our Most Popular Posts

While the blog got its start with Joy Buchanan in mid-2020, we are now just finishing up our first full year and now have a full weekly slate of bloggers. This seems like a good opportunity to reflect on our most popular posts from each of our regular bloggers. We hope you enjoy looking back at these popular posts.

Monday: Mike Makowsky

Makowsky‘s most popular post was from May 2021, titled “Academic Publishing: How I think we got here.” This post generated a significant amount of discussion on Twitter among economists and other academics, and is the second most widely read post on this blog with almost 10,000 views. Makowsky outlined the history and incentives of “how we got here” in terms of the problems with academic publishing, and he is skeptical that there is any easy fix. It seems there is nothing economists love arguing about more than our profession itself. (Follow Makowsky on Twitter)

Tuesday: Scott Buchanan

Scott Buchanan‘s most popular post is “Money as a Social Construct” is from September 2020. It discusses the very basic definition of what we mean by money, and the importance of social trust for both the functioning of money and general social order. The related theme of cryptocurrencies is something he has written a lot about in the last few months of 2020. (He is not yet on Twitter!)

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Mouse Wars: Amazon Mousetrap Reviews as Literature

I have looked at various mouse traps on Amazon. The reviews there are a tremendous source of information. Folks get passionate about their battles with the little rodents who invade and foul their homes. Some reviews soar to literary heights. Here is a user who pours out his despair over being bested by a mouse:

Earthlings Beware!!!! The Toughest Mouse in the World Still Lives: You Could Be NEXT!!!!!!!

Reviewed in the United States on June 30, 2020

These traps were incredibly easy to used and bait. However, I bought these traps To prevent my pets or children from getting injured and to spare my wife from picking up the dead mouse if I wasn’t home. In theory it was the perfect conceptualized mouse trap for a busy house. When this trap arrived I was ready to declare war on the invaders. I put on my camo gear, covered my face with camo paint took some peanut butter out of the cabinet and baited this rodent killing machine. I turned the switch to “set” and tucked it in a spot where I saw mouse droppings. Then I shut off all the lights, Turned on my night vision goggles and waited. Nothing happened, that fury bastard beat me, but I was determined to win the war. I repeated the process the second night only this time I used popcorn to make a trail to the plastic rodent guillotine. I set the trap and went to bed. By dawn I woke up like a child on Christmas, went running down the stairs and to the trap. Boom! The indicator on the side said mouse caught! The pride of winning this battle washed over me. I had defended my castle against an fierce enemy . But wait, why is the trap so light? Surely if a dead mouse was in here I would have been able to feel the weight difference of such a light and sleekly designed trap. I rotated the device in my hand to peer inside of the killing machine. There I stood, with all the pride draining from my short lived victory. The mouse had indeed been attracted to the trap, it followed the popcorn trail of happiness right inside of the devil’s mouth to feast on the peanut butter buffet set up inside. Once inside it tripped the killing mechanism as designed. But this mouse in my house was no ordinary mouse. He must have been a ninja mouse because he dodged the killing instrument likely with a three quarter lateral spin and landed on one hand. He proceeded to eat the peanut butter, then chew his way out of the trap to warn the other ninja mice. I was beaten, defeated by a mouse. I packed up my family and our belongings and moved to new house leaving our old house to the victor. At my new house though, we adopted 70 cats, and although we smell like a mixture of broken dreams and cat urine we never heard from the ninja warrior mouse or his friends again.

 Tomcat Kill & Contain Mouse Trap, 2 Traps  , review by “Brain“

Here is gangsta-style epic, ending in a bitter-sweet victory:

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Effective Advocacy

What does effective political advocacy look like? There is an entire school of thought dedicated to effective altruism. exists solely to evaluate and promote efficient, high-impact charities to help donors maximize the value their donations create. But what about political advocacy? It doesn’t fall neatly within the realm of altruism or charity – there is certainly nothing wrong with advocacy on behalf of yourself or a group you count yourself among, but it’s not altruistic in the classic sense. It also doesn’t conform to the neater forms of dollar efficiency or target outcome analysis that a charity might be evaluated along. Political outcomes don’t always lend themselves to intuitive metrics, or even agreement over whether an outcome should be counted a good or bad thing. There’s nothing especially convenient about political advocacy as a tool for welfare maximization, but that doesn’t free us from its necessity. Abandoning politics for it’s frequent ugliness concedes the power of of governance to the ugliest among us.

Political advocacy requires, nearly by definition, to interface with government institutions. In the case of a democracy, this means working within the limits and incentive structures of politics, and all of the complexity that entails. Leaving behind the relatively straightforward prices and incentives of the marketplace, as well as the fungibility of direct charitable donations, politics demands coping with indirect routes to measurable outcomes and, most importantly, the inevitable arrival of oppositional forces. It doesn’t take long in any meaningful advocacy engagement before the arrival of people and resources working explicitly, if not directly, counter to your efforts. This is not something you have to deal with in most charitable endeavors – efforts to shutdown city food banks and block textbooks from reaching African schoolchildren are thankfully rare.

So, again, what might an effective advocacy practice look like? I imagine it would bare scarce resemblance to your modal election campaign, where the emphasis is on manufacturing turnout in a zero-sum competition with your opponent. I also doubt it would look like most lobbying efforts, where the dollars at work represent the selection-effects of classic collective action problems. Rather than the efficient welfare maximization that a hypothetical would aspire to, the lion share of lobbying simply represents the interests of firms and groups who have identified a bundle of policies whose benefits are sufficiently concentrated within them that it is worth organizing, while at the same time the broader social costs are sufficiently spread out that an opposing forces cannot similarly get over the organizational hump (Yes, I know this is a restatement of the standard Olsonian collective action model of lobbying. Bear with me.)

Effective advocacy would demand working with not just the limited resources of a group without a built-in constituency of concentrated benefits, but also a focused strategy of identifying welfare-maximizing policies unlikely to generate organizable opposition. That’s a tall order. I mean, if you’re going to convince me such a thing is feasible, an example would go a long way. Can you name one?

I’m glad I asked.

The good people at Marginal Revolution posting a link to a paper about the de facto banning of HIV home tests that has been in effect at the FDA for almost 40 years. Suffice it to say, the banning of home tests for a deadly communicable disease is a horrifying policy, one that has without question killed people by the thousands at best and the millions at worst. I imagine the origin story of this regulatory horror is not dissimilar from the opposition to the HPV vaccine – a macabre desire to raise the costs of an undesired behavior. Homosexuality was viewed by many in the not distant past as a choice, HIV/AIDS was killing homosexuals, and a home test would feasibly lower the risk to gay men, so advocates successfully blocked the development of tests. Why did opposition to HPV vaccines find less success? Because HPV is connected to cervical cancer in everyone, and being pro-cancer in the 2010’s enjoyed less popular support than being anti-gay in the 1980s.

This story is a tragic history, but it also represents an opportunity for effective advocacy. The policy, born of homophobia, would never enjoy such popular support today. It survives almost exclusively of regulatory inertia today. A minimum of lobbying resources could feasibly end the policy in large part because it’s originating constituency is diminished and would be unlikely to successfully organize.

This, in a nutshell, is the opportunity for effective advocacy – the strategic search for welfare-harming policies whose originating constituencies have shrunken or disappeared. It’s not particularly exciting, the notion of combing through policies on the books, agency by agency, looking for harmful policies with little to no continuing political support, but it is in that lack of excitement within which the opportunity lies. Reform of headline- and chryon-inducing policies have built in opposition. Any political or politics-adjacent effort that garners significant media attention always promises similar attention for opposing forces. It is within the boring stuff, the bureaucratic protocols and categorical bans produced at the margins of historical political battles, where advocacy, particularly crowd-sourced efforts, motivated by the same sentiments behind effective altruism and efficient charity might make contributions to our government institutions in the best way possible: by making changes that nobody can get attention from opposing.

That’s just one opportunity for effective altruism: inattention. There are no doubt more, but I suspect many will share at least a sliver of unsexy monotony. A better world through boredom.

Christmas Day

These are memes from my favorite nostalgic Christmas movie. I hope no one needed advice about inflation.

Lastly, I have, in the past, assigned college students to read Dickens’s A Christmas Carol JUST so we can talk about how messed up the book is and how the portrayal of markets is unhelpful.

Using Economics to Save Presents from the Economists

Economists like to hate on gift giving. Many of them consider purchasing a gift for another person as a futile attempt at imagining the preferences of another person. Given that you can’t perfectly know another person’s preferences, your gift selection will be sub-optimal. The argument goes that your friend or spouse or whomever would have been better off if you had given them money instead. Then they could have made the gift decision fully equipped with the information that is necessary to make them happiest.

There are some obvious things that are glossed over. Purchasing a good gift – or even writing a card – carries a big load of signaling value. People like to be liked and receiving a good gift signals that the giver cared enough to research appropriate gifts. Also, receiving money as a gift puts the onus of research and transaction costs on the receiver. If the recipient’s value of time is adequately high, then cash payments are even more resource destructive than giving a non-pecuniary gift. Especially if there is an expectation that the giver will later enquire about how the funds were used. At that point, the giver is saddling the recipient with all of the anxieties and costs of choosing a gift that makes another person happy.

But I want to talk about a non-obvious benefit of gift giving.

First, I want to talk about student loans (I promise, it’s relevant). Plenty of people argue that college students don’t understand debt and that they therefore don’t understand the future cost that they will bear by borrowing. When the lender is the department of education, there is no defaulting with the hope of bankruptcy. The debt will get repaid…. So far anyway.

If it’s true that students don’t understand debt, then we can appropriately construe future student loan payments as lump-sum costs. Of course there is deferment and forbearance – but put those to the side. The bottom line is that, almost regardless of a debtor’s activities, they must repay their debt. It doesn’t matter how the debtor earns or consumes, the debt must be paid. This fits the description of a lump-sum cost. Usually, things like lump-sum taxes are hypothetical and unpopular among the laity. But, if we accept that the decision-making-student has incomplete information in regard to the debt’s future payment implications, then the debt payments are exogenous and unavoidable from the future debtor’s perspective.

This is a good thing for the productivity of our economy. Because people are making tradeoffs between the two goods of leisure and consumption, a lump-sum tax causes individuals to work more than they would have worked otherwise. Lump-sum taxes don’t reduce the marginal benefit of working. Essentially, a debtor’s first several hours of work pay-off his debt first and then he gets to work for his own consumption.

Importantly, this ignores any human capital effects of the education. It doesn’t matter whether education actually makes people more productive. The seemingly exogenous debt payments cause debtors to work more and produce more for others. The RGDP per capita of our economy rises and we know that most of the benefits of work do not accrue to producers. Student debt, with the accompanying assumptions laid out above, therefore increases our incomes because it acts as a lump-sum tax.

Now it’s time to save presents from the economists.

As families get older and siblings drift apart, gift-giving begins to become less exciting. I’m tempted to say there is a natural process in which the first couple of adult-sibling Christmases include decent gifts. Then, the gifts become not-so-great as siblings become less familiar with each others’ preferences. Knowing this and still wanting to give a suitable gift, siblings may turn to gift cards. The less that a sibling knows the preferences of another, the more general the gift card.

If you’ve grown more distant from your brothers/sisters and you know that you’ll receive a gift, then it’ll probably be an Amazon, or Walmart, or some other gift card that permits spending on a broad variety of gifts. There comes a point when you’re spending $X on gift cards each year where $X = $x(n). That is, you’re spending some amount on each sibling for a total of $X each year. And for the sake of social cohesion and norms, all of your siblings are doing the same thing and spending the same amounts.

Importantly, you don’t control the social norms, nor your number of siblings. It might seem like you’re all just trading dollar bills at a unitary exchange rate, leaving no-one better or worse-off. But, trading cash is gauche. So, distant siblings trade broadly attractive gift cards in order to achieve that gift-like aura.

Social norms also say that gift giving is not a trade. If you don’t receive a gift, then you’re supposed to be ‘ok’ with that. So, each year you will spend $X on gift cards for your distant siblings and there is some probability that you get nothing in return. If you can’t control the number of siblings that you have and you can’t control whether you receive a gift card in return, then giving cash or cash-like gift cards to your siblings each year is a lot like a lump-sum cost. Socially – or maybe morally – you shouldn’t just ignore your siblings and it is incumbent upon you to give a gift.

Having to give away a lump-sum of money or money-like things no matter what else you do is a lump-sum cost. If people bear lump-sum costs, then they will work a little bit more and produce a little bit more for society. If gifts suboptimal but at least considered a ‘good’, then we’re better off: we work more to make others somewhat better off with resources that wouldn’t exist if we hadn’t chosen to give to others.

There are some caveats, of course. Economists are often not so popular at parties for a variety of reasons. One reason is that they flout social conventions. An economist might scoff at the social constraints as unbinding. Others would disagree. Another point of contention may be that an individual can choose to work no more, but to invest less instead. But this really just pushes the problem off until the individual has less income in the future and works more to compensate for it at a later time. A 3rd caveat is that we can choose the amount that we spend in others. But that just implies that at least part of the gift giving ritual isn’t a lump-sum cost. It does not imply that none of gifting giving is a lump sum cost.

Regardless, the social convention of giving gifts can provide for a Schelling point that makes us a more productive as a society. We spend on others, to a great degree beyond our individual control, in order to avoid severe social stigma. And, if we can’t control all of who counts as a worthy recipient of gifts, then we have a lump-sum cost to some degree. Giving gifts makes sense as a productive convention because it makes us a richer as part of a general equilibrium – if not a partial equilibrium. Merry Christmas.

Certificate of Need and Mental Health

Most US states require hospitals and other healthcare providers to obtain a “Certificate of Need” (CON) from a state board before they are allowed to open or expand. These laws seem to be one reason why healthcare is often so expensive and hard to find. I’ve written a lot about them, partly because I think they are bad policies that could get repealed if more people knew about them, and partly because so many aspects of them are unstudied.

States vary widely in the specific services or equipment their CON laws target- nursing homes, dialysis clinics, MRIs, et c. One of the most important types of CON law that remained unstudied was CON for psychiatric services. I set out to change this and, with Eleanor Lewin, wrote an article on them just published in the Journal of Mental Health Policy and Economics.

We compare the state of psychiatric care in states with and without CON, and find that psychiatric CON is associated with fewer psychiatric hospitals and beds, and a lower likelihood of those hospitals accepting Medicare.

Together with the existing evidence on CON (which I tried to sum up recently here), this suggests that more states should consider repealing their CON laws and letting doctors and patients, rather than state boards, decide what facilities are “economically necessary”.

Is Travel Back?

According to the most recent TSA data, on December 21st of this year there were 1,979,089 people traveling by plane. That’s almost exactly equal to the number of people that flew in the US on the same date in 2019: 1,981,433 travelers. It’s also double the number of people that few on December 21, 2020 (about 992,000). These numbers are encouraging. Does that mean that we’re back to normal levels of travel?

Not quite. We shouldn’t read too much into one day of data, for a variety of reasons, but most importantly because while we’re looking at the same date, travel varies throughout the week and December 21st is a different day of the week every year (Tuesday this year, Saturday in 2019). It’s better to use a weekly average and compare it to 2019. Here’s what the data looks like for 2020 and 2021.

With this data, we can see that airline travel is back to about 85 percent of 2019 levels. That’s not bad, but airline travel was already back to 85 percent by early July 2021, with some variation since then, but generally staying in the 70-90 percent range for most of the second half of the year.

For those that are flying this year, there is good news in terms of prices (unusual to have good prices news right now): airfares are still about 20 percent cheaper than pre-pandemic levels. In fact, airline prices are the cheapest they have been since 1999. In nominal terms! If you are interested in even more historical price data, take a look at my May 2021 post on the “golden age” of flight.

And of course, flying is not the most common way that people travel for Christmas and the holiday season. According to estimates from AAA, only about 6 percent of holiday travelers choose to fly. This was true in 2019, and will be roughly true in 2021 (as usual, 2020 was the exception: around 3 percent). By far the most common mode of travel in the US is driving, accounting for over 90 percent of holiday travel.

If you are traveling by car, there isn’t much good news for prices. As you have no doubt heard constantly for the past few months, gasoline costs a lot more than it did last Christmas, on average about $1 per gallon more. But even compared to Christmas 2019, gasoline prices are almost 29 percent higher. The last time gasoline prices were this high (in nominal terms) around Christmas was in 2013.

I hope you all have safe holiday travels, and we’ll all look forward to better prices in the New Year!

How Can Cryptocurrency Accounts Pay Such High Interest?

As noted last week, I am happily receiving 9% interest in my new crypto account at BlockFi. How can they do that? The short answer is that BlockFi lends out my holdings to other parties, who pay somewhat more than 9% interest to BlockFi. This model is common to essentially all of the crypto brokers who pay out interest, but I will focus on BlockFi because (a) I have skin in the game there, and (b) they have been fairly transparent about their operations.

On the simplest level, this operates like a plain bank savings account does. A bank takes in funds from depositors, and (to oversimplify) lends those funds out to borrowers. The bank then pays to its depositors a portion of the interest it receives from its borrowers. Up until the last few years, this bank savings account model worked pretty well;  a depositor might receive something like 2-3% interest on a savings account or certificate of deposit. More recently, short term rates have been near zero, so depositors get almost nothing in a bank savings account.

As noted earlier, BlockFi pays up to 4.5% interest on Bitcoin and 5% on Ethereum. These are leading, high volume coins that are widely used in decentralized finance (defi). Here is how BlockFi describes the parties to which it lends (mainly) Bitcoin:

Who Borrows Crypto?

BlockFi works with institutional counterparties for trading and lending cryptocurrency. These counterparties look to us to help them provide liquidity for their businesses. But who are some of these borrowers?

( 1 ) Traders and investment funds who see a fragmented marketplace and discover arbitrage trading opportunities. Arbitrageurs need to borrow crypto in order to close mispricing between exchanges or dispersed markets. Similarly, margin traders need to borrow in order to execute their trading strategies. This is a simple example, but it demonstrates how arbitrage and margin trading activities facilitate price discovery, which is an essential component of developed markets.

( 2 ) Over the counter (OTC) market makers make money by connecting buyers and sellers who do not want to transact over public exchanges. OTC desks need to keep inventory on-hand to meet their client demand. Owning crypto outright is capital intensive and comes with the attendant risks of price fluctuations. Instead, they may prefer to borrow inventory in order to facilitate transactions. Liquidity is another essential component to healthy markets.

( 3 ) Businesses that require an inventory of crypto to provide liquidity to clients. This bucket includes companies like crypto ATMs. These businesses also need to be able to support withdrawals while keeping the vast majority of their crypto assets in cold storage. The liquidity we provide them helps with these basic and important functions.

A key piece of this lending is to require that the counterparty post adequate collateral for the loans. This is somewhat similar to a bank lending you money to buy a house, with the house as collateral for your loan. If you lose your job and cannot pay back the loan, the bank has the right to sell your house to recovery its money. Similarly, BlockFi wants to ensure that if something goes sour with their loan of your Bitcoin, they can get their funds back and make your account whole. Obviously, BlockFi customers like me are relying on BlockFi to manage this properly and to minimize lending losses. BlockFi goes on to reassure us:

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Something is going on with shoplifting

Organized shoplifting mobs! Retailers claiming increases in shoplifting! Journalists claiming its an overstated numbers grift! Other journalists saying we should ignore shoplifting because corporate theft! The conversation about shoplifting is often hysterical and occasionally stupid, but that doesn’t mean something isn’t actually happening. Some of the facts seem clear, others murkier, and the underlying causes, like everything during this pandemic, are no doubt complex and uncertain. Let’s see if we can organize our thoughts a bit.

What we know

Shoplifting has been on the rise across the United States, with increasing theft of both staples for survival and the goods most easily resold on the black market. More specifically, and perhaps even more certainly, a still wealthy San Francisco, where one would expect retailers to desperately want a presence, can only seem to watch as its retailers flee. CVS is out. Walgreens is out. One Target it out (but not the biggest one). And the reason they claim is not commercial real estate overhead costs or declining customer bases, but an overwhelming increase in shoplifting (or what the retail industry used to call “inventory shrink”). While obviously not the whole story, the effective decriminalization of theft under $950 in San Francisco seems a key component. It doesn’t take any clever or subtle theorizing to expect that if the cost of theft under a certain threshold is radically lowered, then all you have to do is disaggregate your theft events across time and people to yield a sufficiently lucrative use of time (especially for those who are struggling or already carry the far weightier burden of a felony record). You can’t lower the opportunity cost of labor (less jail time) in a field of endeavor (boosting consumer goods) and pretend to be shocked when supply increases (more theft).

What we think

I am sure there is no shortage of “greedy corporations are abandoning American cities” and other malice-based theories, but those aren’t particularly useful theories. Retailers want customers and cities have a lot lot of them. So the first possibility is that they are simply telling us, and their shareholders, the truth– theft has reduced the profitability of stores such that the optimal decision is to close the doors. It would be a pretty shocking development to look back one day and realize that shoplifting was what closed the book on brick and mortar retail. Not Amazon or delivery drones, but the favored hobby of bored delinquents and subsidy of struggling families.

To those ends, though, a meteoric rise in shoplifting nonetheless feels, if not convenient, then incomplete as an explanation. CVS isn’t just closing in San Francisco, it’s closing 900 stores and moving to a new “store format”. Perhaps the better way of framing these closures isn’t a “crime wave of shoplifting” but rather more evidence that the brick and mortar retail industry is incredibly fragile, where any unforeseen increase in costs immediately threatens profitability. In a composite of shoplifting, online competition, the unabated growth of Costco and other wholesale clubs, and the rise in reservation wages of labor all across the country, which story would you want to emphasize to your shareholders as you close shops in urban centers? That you can’t compete? That you can’t afford labor? Or that you are being forced out by the crumbling of civilization into Mad Max dens of wayward lawlessness? At least the last one holds out hope that your business model isn’t wholly obsolete.

Still, people definitely seem to be stealing a lot of stuff, and that just creates one more cost advantage for online competitors and venues that require membership for admission. Things are changing, perhaps at an accelerated rate thanks to the pandemic and it’s accompanying bundle of policy responses. When considering fundamental change, observation of chaos rarely offers evidence to the contrary.

What can or should we do?

There are lots of things we should decriminalize. Lots. But I am extremely confident that theft is not one of them. The consequences are obvious, and in the short run will be felt almost exclusively by the poorest, who depend on local retailers, particularly those on the public transportation routes they take to work. Further, this is a problem that can metastasize as people don’t just supplement their incomes with theft, but specialize in it. It will hollow out the largest retailers and the smallest bodegas. It will change the the entire structure of physical marketplaces. It will change how people interact with core components of our welfare system. It will poison another relationship, this time between seller and customer, where people are increasingly viewed as a threat.

So what should we do? Desperate people stealing rice and other staples is one more argument for an unconditional universal basic income. People opting for black market income is one more argument for wage subsidies to increase relative attractiveness of wages in the legal market. And people stealing because the price of getting caught approaches zero? That’s an argument for raising the price of theft. Not to new and cruel heights, but to the levels they were at before i.e. high enough that theft is nothing but a last resort. A very last one.