In the early 1990s, many economists came to see education as key to growth. N. Gregory Mankiw, David Romer, and David N. Weil (1992) famously augmented Robert M. Solow's (1956) neoclassical growth model by including the secondary school enrollment rate as a measure of investment in "human capital." The result was a policy agenda that sought to increase funding for education. Hence, when the Federal Reserve Bank of Kansas City invited numerous leading economists to its annual symposium at Jackson Hole on August 27-29, 1992, this became the major theme of the conference. Mankiw (1992, 90-91), for example, described education as one of the "four secrets to fast growth." On this, there was some consensus among assembled grandees, who were predominantly employed at Harvard. "If the often-bickering economists were able to forge a consensus on anything," the New York Times reported, "it was that providing more education is a sure way for a nation to increase its output. Time and again, the economists stressed the importance of improving 'human capital,' meaning that a better-educated, better-trained work force can lift a nation's growth rate" (Greenhouse 1992). Alongside the economic-growth narrative is a parallel narrative that portrays education spending as key to reducing inequality. It is based on a model first proposed by Lawrence F. Katz and Kevin M. Murphy (1992) that has been massively influential. This article reviews how the model has repeatedly failed to predict the evolution of its dependent variable, the college wage premium. Various specifications of the econometrics used to test the model are replicated using data from David H. Autor, Claudia Goldin, and Katz's (2020) most recent update. Their dataset for the college wage premium and the relative supply of college-educated labor covers the period 1914 to 2017, and it has been extended here to 2023 using the same source, the Current Population Survey (CPS).2 That dataset is first used to replicate Katz and Murphy's (1992) original results and then the original out-of-sample test performed by Autor, Katz, and Melissa S. Kearney (2008). Finally, the elaborate specifications found in Goldin and Katz's (2008) book The Race between Education and Technology are replicated. It should be stressed that the replications are not exact, given how the dataset has changed over time. Nonetheless, they are sufficiently close to the originals to demonstrate the problem that the Katz-Murphy model has routinely faced: as Autor, Katz, and Kearney (2008) first noted, the model is unable to predict the evolution of the college wage premium, which has led to ex-post specification searching to make the model fit the data. Standard tests from time series econometrics indicate, moreover, that the model is misspecified and has on for its validation.
I have been asked to respond to "The Impartial Spectator Rises," an article by Daniel B. Klein, Nicholas R. Swanson, and Jeffrey T. Young (KSY), published in this journal (Klein et al. 2025). I am grateful and honored to have the opportunity to do so. I believe their study is useful for scholars because it puts into stark relief a core interpretive question at the heart of Smith's corpus: to what extent is the impartial spectator an ideal observer? The problem, summarized, is this: the impartial spectator is the personification of Adam Smith's theory of conscience in The Theory ofMoral Sentiments (TMS). By nature, moral actors grow to become virtuous by confirming the propriety of their actions and sentiments through social affirmation. Taken alone, this would subordinate all individual action to others' judgment and community norms. It would also inhibit progressive moral growth. To forestall this, Smith describes his actors as cultivating their ability to imagine an impartial spectator: a second identity whose judgment is distinct from, and supersedes, the community. This imagined impartial spectator is the final arbiter of the moral actor's self-evaluation, and virtuous people rely on it to confirm, deny, or modify social judgment. Smith describes his moral psychology by intertwining two different frameworks of understanding. The first is a naturalism that seeks to explore individual and collective action a Newtonian lens. Hume called this "the science of man" (Hume 1739-40, 3-6).2 The second involves theologically-coded language that grounds the impartial spectator's judgment in God, whom Smith refers to in a variety of ways including "the Deity," "the Author of Nature," and "the man within the breast." These frameworks are compatible from both a theistic and deistic point of view, but they are not compatible within naturalism. The questions at hand, and the interpretive puzzles that Smith scholars struggle with, are these: What is the metaphysical status of the impartial spectator? What are its epistemological limits? Is it an agent of God through which someone can access divine knowledge, or is it a human creation limited by the fallibilities of the imagination? These two questions frame KSY and my response, here. Klein, Swanson, and Young describe three possibilities for understanding Smith's normative moral psychology. First, following Roderick Firth, an impartial spectator may be an ideal observer with divine grounding whose normativity comes from an Archimedean point of view.3 Second, the impartial spectator may be "flattened" in that it is a product of an individual agent's imagination and therefore limited by the imaginer's fallible capacities.4 They correctly cite me as someone who defends this second interpretation. Third, the impartial spectator may be a "weak" compromise of the other two: an abstract figure with special epistemological access that is compatible with, but not necessarily bound to, a Christian god. KSY argue for this third understanding and provide a literature review of those who hold opposing positions. I take no issue with their presentation of the landscape of Smith scholarship. Nor do I have any concerns regarding their summary of my work, although I'd like to express my mild surprise at their reaching back three decades to my doctoral dissertation (and my pleasant relief that such an immature work was coherent enough to be relevant) (Weinstein 1998). Instead, my goal in this response is to articulate why I continue to disagree with the divinely-infused interpretations of the impartial spectator and reject their compromise position. I will present conceptual, biographical, terminological, exegetical, and political objections to their argument, in that order. I will not summa- rize the two alternative positions in detail, presuming my readers' familiarity with the Smithian debate and context. KSY's literature review far surpasses what I could present here, and I encourage all interested scholars to become familiar with it.
In this article we employ bibliometric methods to show how the study areas of central banking research have creeped increasingly into environment, inequality, gender, and race/inclusivity-related topics. Before turning to our investigation, we review the nature, privileges, and mandates of central banks, along with current trends, to explain why the investigation was undertaken.
