Reading: Exam results affected by hotter weather

Hot weather lowers exam results. A major study from three universities in the USA says heat may reduce learning in the short and long term. Hot weather on test days, and higher than average yearly temperatures lowered grades.

Researchers looked at how the weather affected test scores from 10 million American students. Findings showed that a temperature rise of just 0.55ºC over one year led to a one per cent decrease in learning. The research paper is called “Heat and Learning”. It was published last month.

A worrying conclusion in the study is that global warming may affect the future income of students around the world. Researchers said that if global temperatures continued to rise, the average American student could lose $25,000 because of lower test scores. Air conditioning in classrooms could stop this. Hotter weather was “particularly damaging” for poorer students.

Listening

 

Vocabulary

How were these words used in the article:

  1. lowers
  2. major
  3. term
  4. average
  5. grades
  6. decrease
  7. worrying
  8. income
  9. rise
  10. scores

 

 

 


Original content from: https://breakingnewsenglish.com/1806/180601-exam-results-4.html

Reading: Charity Chic

100215815_0000The First Lady of Iceland, Eliza Reid, has turned heads at a movie awards ceremony. Fashion reporters said Ms Reid wore a “stunning” black jacket to the Edda Awards – Iceland’s version of Hollywood’s Academy Awards. Ms Reid wore black to show her support for the #metoo movement. However, unlike most people who attend glamorous awards shows, Ms Reid did not spend a fortune on her clothes. When reporters asked her where she had purchased her jacket, she said she bought it in a local Red Cross charity store in Iceland’s capital city. The Icelandic Red Cross was very happy about this news. It told its followers on Twitter that the first lady looked, “awesome in a gorgeous jacket from the Red Cross”.

Eliza Reid is originally from Canada and works as a journalist. She met her husband, President Gudni Johannesson, when she was studying at Oxford University. Ms Reid told the Hit Iceland website in 2017 that she “won” a blind date with the future president at a rowing club event. She had no idea she would one day become First Lady of Iceland. Both she and her husband are very popular in Iceland for being just like normal people. They both have a very down-to-earth attitude and can often be seen in the city shopping with their four children and going to restaurants. The Red Cross also likes Ms Reid. It hopes more people will follow her fashion sense and buy clothes from its charity shops.

 

icelandic fashion
Another example of Icelandic fashion

Comprehension Questions:

  1. What did Eliza Reid turn at an awards ceremony?
  2. What colour jacket did Ms Reid wear?
  3. What movement did Ms Reid want to show support for?
  4. Who asked Ms Reid where she bought her jacket?
  5. In which city did Ms Reid buy the jacket?
  6. Where is Ms Reid from originally?
  7. Where did Ms Reid meet her husband for the first time?
  8. What kind of club event did Ms Reid meet her husband at?
  9. What kind of attitude to Ms Reid and her husband have?
  10. What does the Red Cross hope people will follow?

Vocabulary Activity:

Try to recall how the following words were used in the text:

  • originally
  • met
  • won
  • popular
  • seen
  • sense
  • heads
  • version
  • support
  • unlike
  • city
  • followers

 

Discussion Questions:

  1. What images are in your mind when you hear the word ‘first’?
  2. How important is a First Lady?
  3. Why don’t all countries have a First Lady?
  4. What do you know about Iceland?
  5. What do you think about charity shops?
  6. What would you wear to an awards show?
  7. Should more famous people wear clothes from charity shops?
  8. Why do people want to look glamorous?
  9. Would you buy clothes from a charity shop?
  10. What do you think of when you hear the word ‘lady’?
  11. What do you think about what you read?
  12. What does a First Lady do all day?
  13. What do you think of Iceland’s First Lady?
  14. What would it be like to be married to the President?
  15. What do you think of the idea of blind dates?
  16. How down-to-earth are you?
  17. What is your favourite charity?
  18. What questions would you like to ask Iceland’s First Lady?

Reading: Facebook Data Breach

Article:

Facebook boss Mark Zuckerberg apologized for the data breach that was revealed last week. Mr Zuckerberg took out full-page advertisements in broadsheet newspapers in the UK and US to make his apology for the data privacy scandal. Zuckerberg was being criticized for being too slow to respond to the news. Personal data on up to 50 million users was used by a U.S. political consultancy called Cambridge Analytica. This company is accused of using the leaked data to benefit Donald Trump’s 2016 presidential campaign. Zuckerberg said: “This was a breach of trust, and I am sorry….We’re now taking steps to make sure this doesn’t happen again.” The apology made no mention of Cambridge Analytica.

Mr Zuckerberg acknowledged that Facebook could and should have done more to protect user data and to stop it being exploited. Reports are now circulating that Facebook was warned its data protection was too weak back in 2011. Mr Zuckerberg outlined the actions Facebook would take going forward. He said: “We’re investigating every single app that had access to large amounts of data before we fixed this. We expect there are others. And when we find them, we will ban them and tell everyone affected.” The value of Facebook has fallen by $75 billion this week; Zuckerberg’s wealth fell by $10 billion. There has also been a surge in users abandoning their Facebook pages, in online calls to #deletefacebook.

 

Comprehension Questions:

  1. What kind of newspapers did Facebook put ads in to apologize?
  2. What is Mark Zuckerberg being criticized for?
  3. How many users may have had their data exploited?
  4. What kind of company is Cambridge Analytica?
  5. What is Facebook taking to ensure there is not another data breach?
  6. What could and should Facebook have done to protect data?
  7. When was Facebook warned about its weak data protection?
  8. What is Facebook now investigating?
  9. How much less is Mark Zuckerberg worth since the scandal began?
  10. What is the hashtag that is encouraging users to close their page?

 

Vocabulary:

Look at the words below and try to recall how they were used in the text

  • more
  • weak
  • single
  • ban
  • week
  • surge
  • last
  • slow
  • political
  • leaked
  • sorry
  • mention

 

Opinion Questions

  1. What did you think when you read the headline?
  2. What images are in your mind when you hear the word ‘online’?
  3. What do you think of Facebook?
  4. How much do you worry about your private information online?
  5. How much damage will this do to Facebook?
  6. Why do you think Mr Zuckerberg was slow to respond to this news?
  7. Does Mr Zuckerberg’s apology go far enough?
  8. What should happen to the political consultancy in this story?
  9. What steps does Facebook need to take?
  10. What advice do you have for Mark Zuckerberg?
  11. What do you think of when you hear the word ‘privacy’?
  12. What do you know about this news?
  13. What do you think of companies that sell your mail address?
  14. How much do you trust online companies with your data?
  15. What actions could users whose details were leaked take?
  16. Will Facebook still be going in 20 years from now?
  17. What would happen if many people left Facebook?
  18. What questions would you like to ask Mark Zuckerberg?

Discussion: It is becoming too dangerous to put our personal information online.


Content sourced from: https://breakingnewsenglish.com/1803/180327-data-breach.html

Reading: “Arkham Asylum” wins Award

The Batman video game “Arkham Asylum‟ has won top prize at Britain’s biggest gaming awards. The all-action superhero adventure picked up best game at the Bafta 2010 awards. Gamers can take on the role of Batman as he fights his traditional enemies in an asylum. It is only the seventh time Bafta has given the award. The best video game category only started in 2004. Bafta is the British Academy of Film and Television Arts. Its new award is to recognise “artistic, creative and technical innovation in video games”. Second place went to the shoot-em-up game, Call of Duty: Modern Warfare 2‟. This game won the Game award, voted for by gamers. Nintendo scooped the best family and social game with its Wii Sports Resort.
A special moment at the ceremony was when Bafta presented a lifetime achievement award to legendary game maker Shigeru Miyamoto. He is the creator of legendary games such as Super Mario, Donkey Kong, and The Legend of Zelda. He told the audience: “Our imaginations and creativity…should be the only limits and that is what makes our industry a joy and a dream to work in.” Miyamoto‟s words summed up the confidence shared by everyone in the industry. A British politician Tom Watson echoed Miyamoto as he handed out a prize. He said to games  designers: “You are going to be the dominant creative medium of this century.” Many designers believe they are showing a lot more creativity than Hollywood.

ACTIVITIES:

1. Discuss these keywords: Batman / gaming / awards / superhero / enemies / creativity / innovation / Nintendo / ceremonies / achievement / Super Mario / imaginations / confidence / Hollywood

2. Spend one minute writing down all of the different words you associate with the word “gamer‟.

3. TRUE / FALSE: Are these sentences true or false?
  1. A Batman video game scooped the top prize at a British awards show. T / F
  2. The Batman video game only has new enemies in it. T / F
  3. The Bafta awards for video games are now in their tenth year. T / F
  4. Nintendo won an award for one of its Wii games. T / F
  5. The maker of the Super Mario game got a special award. T / F
  6. Shigeru Miyamoto said working in the game industry is like a dream. T / F
  7. A British politician complained the awards show echoed too much. T / F
  8. Many designers believe Hollywood is more creative than gaming. T / F

4. Look at the words below and try to recall how they were used in the text:

top, role, category, artistic, voted, social, lifetime, creator, audience, summed, echoed, medium


5. Answer these questions
a) What did you think when you read the headline?
b) What springs to mind when you hear the word “gaming‟?
c) What do you think of video games?
d) How would your life be different if there were no video games?
e) Do you like the idea of an awards ceremony for video games?
f) What kind of people do you think work in the video game industry?
g) What is your favourite game and why?
h) What are the biggest differences between today‟s games and those that came out five years ago?
i) What‟s your favourite games console (and why)?
j) Would you like to play the new Batman game?
k) Did you like reading this article?
l) What do you think you have to do to get a lifetime achievement award?
m) What‟s the best game ever?
n) Would you like to work in the gaming industry?Why?
o) How creative are you?
p) How important is creativity?
q) Do you think movies or games are more creative?
r) Do you prefer to watch movies or play games? Why?
s) What will games of the future be like?
t) What questions would you like to ask Shigeru Miyamoto?

Continue reading “Reading: “Arkham Asylum” wins Award”

Reading: Regulating Internet Giants (C1)

The world’s most valuable resource is no longer oil, but data.

The data economy demands a new approach to antitrust rules

 

Such dominance has prompted calls for the tech giants to be broken up, as Standard Oil was in the early 20th century. This newspaper has argued against such drastic action in the past. Size alone is not a crime. The giants’ success has benefited consumers. Few want to live without Google’s search engine, Amazon’s one-day delivery or Facebook’s newsfeed. Nor do these firms raise the alarm when standard antitrust tests are applied. Far from gouging consumers, many of their services are free (users pay, in effect, by handing over yet more data). Take account of offline rivals, and their market shares look less worrying. And the emergence of upstarts like Snapchat suggests that new entrants can still make waves.

But there is cause for concern. Internet companies’ control of data gives them enormous power. Old ways of thinking about competition, devised in the era of oil, look outdated in what has come to be called the “data economy”. A new approach is needed.

Quantity has a quality all its own

What has changed? Smartphones and the internet have made data abundant, ubiquitous and far more valuable. Whether you are going for a run, watching TV or even just sitting in traffic, virtually every activity creates a digital trace—more raw material for the data distilleries. As devices from watches to cars connect to the internet, the volume is increasing: some estimate that a self-driving car will generate 100 gigabytes per second. Meanwhile, artificial-intelligence (AI) techniques such as machine learning extract more value from data. Algorithms can predict when a customer is ready to buy, a jet-engine needs servicing or a person is at risk of a disease. Industrial giants such as GE and Siemens now sell themselves as data firms.

This abundance of data changes the nature of competition. Technology giants have always benefited from network effects: the more users Facebook signs up, the more attractive signing up becomes for others. With data there are extra network effects. By collecting more data, a firm has more scope to improve its products, which attracts more users, generating even more data, and so on. The more data Tesla gathers from its self-driving cars, the better it can make them at driving themselves—part of the reason the firm, which sold only 25,000 cars in the first quarter, is now worth more than GM, which sold 2.3m. Vast pools of data can thus act as protective moats.

Access to data also protects companies from rivals in another way. The case for being sanguine about competition in the tech industry rests on the potential for incumbents to be blindsided by a startup in a garage or an unexpected technological shift. But both are less likely in the data age. The giants’ surveillance systems span the entire economy: Google can see what people search for, Facebook what they share, Amazon what they buy. They own app stores and operating systems, and rent out computing power to startups. They have a “God’s eye view” of activities in their own markets and beyond. They can see when a new product or service gains traction, allowing them to copy it or simply buy the upstart before it becomes too great a threat. Many think Facebook’s $22bn purchase in 2014 of WhatsApp, a messaging app with fewer than 60 employees, falls into this category of “shoot-out acquisitions” that eliminate potential rivals. By providing barriers to entry and early-warning systems, data can stifle competition.

social_network_analysis_visualizationWho ya gonna call, trustbusters?

The nature of data makes the antitrust remedies of the past less useful. Breaking up a firm like Google into five Googlets would not stop network effects from reasserting themselves: in time, one of them would become dominant again. A radical rethink is required—and as the outlines of a new approach start to become apparent, two ideas stand out.

The first is that antitrust authorities need to move from the industrial era into the 21st century. When considering a merger, for example, they have traditionally used size to determine when to intervene. They now need to take into account the extent of firms’ data assets when assessing the impact of deals. The purchase price could also be a signal that an incumbent is buying a nascent threat. On these measures, Facebook’s willingness to pay so much for WhatsApp, which had no revenue to speak of, would have raised red flags. Trustbusters must also become more data-savvy in their analysis of market dynamics, for example by using simulations to hunt for algorithms colluding over prices or to determine how best to promote competition.

The second principle is to loosen the grip that providers of online services have over data and give more control to those who supply them. More transparency would help: companies could be forced to reveal to consumers what information they hold and how much money they make from it. Governments could encourage the emergence of new services by opening up more of their own data vaults or managing crucial parts of the data economy as public infrastructure, as India does with its digital-identity system, Aadhaar. They could also mandate the sharing of certain kinds of data, with users’ consent—an approach Europe is taking in financial services by requiring banks to make customers’ data accessible to third parties.

Rebooting antitrust for the information age will not be easy. It will entail new risks: more data sharing, for instance, could threaten privacy. But if governments don’t want a data economy dominated by a few giants, they will need to act soon.

Reading: Blockchains Changing The World (C1)

Ignore Bitcoin’s challenges. In this interview, Don Tapscott explains why blockchains, the technology underpinning the cryptocurrency, have the potential to revolutionize the world economy.

What impact could the technology behind Bitcoin have? According to Tapscott Group CEO Don Tapscott, blockchains, the technology underpinning the cryptocurrency, could revolutionize the world economy. In this interview with McKinsey’s Rik Kirkland, Tapscott explains how blockchains—an open-source distributed database using state-of-the-art cryptography—may facilitate collaboration and tracking of all kinds of transactions and interactions. Tapscott, coauthor of the new book Blockchain Revolution: How the Technology Behind Bitcoin is Changing Money, Business, and the World, also believes the technology could offer genuine privacy protection and “a platform for truth and trust.” An edited and extended transcript of Tapscott’s comments follows.

Video

Interview transcript

In the early 1990s, we said the old media is centralized. It’s one way, it’s one to many; it’s controlled by powerful forces, and everyone is a passive recipient. The new web, the new media, we said, is one to one, it’s many to many; it’s highly distributed, and it’s not centralized. Everyone’s a participant, not an inert recipient. This has an awesome neutrality. It will be what we want it to be, and we can craft a much more egalitarian, prosperous society where everyone gets to share in the wealth that they create. Lots of great things have happened, but overall the benefits of the digital age have been asymmetrical. For example, we have this great asset of data that’s been created by us, and yet we don’t get to keep it. It’s owned by a tiny handful of powerful companies or governments. They monetize that data or, in the case of governments, use it to spy on us, and our privacy is undermined.

What if there were a second generation of the Internet that enabled the true, peer-to-peer exchange of value? We don’t have that now. If I’m going to send some money to somebody else, I have to go through an intermediary—a powerful bank, a credit-card company—or I need a government to authenticate who I am and who you are. What if we could do that peer to peer? What if there was a protocol—call it the trust protocol—that enabled us to do transactions, to do commerce, to exchange money, without a powerful third party? This would be amazing.

Several years ago, an unknown person or persons named Satoshi Nakamoto came up with the Bitcoin protocol. Once again, the technology genie has been unleashed from its bottle. It gives us another kick at the can, another go, to try and rethink the economic power grid and the old order of things. That, to me, is how big this is. It feels like 1993.

How the blockchain works

The blockchain is basically a distributed database. Think of a giant, global spreadsheet that runs on millions and millions of computers. It’s distributed. It’s open source, so anyone can change the underlying code, and they can see what’s going on. It’s truly peer to peer; it doesn’t require powerful intermediaries to authenticate or to settle transactions.

It uses state-of-the-art cryptography, so if we have a global, distributed database that can record the fact that we’ve done this transaction, what else could it record? Well, it could record any structured information, not just who paid whom but also who married whom or who owns what land or what light bought power from what power source. In the case of the Internet of Things, we’re going to need a blockchain-settlement system underneath. Banks won’t be able to settle trillions of real-time transactions between things.

So this is an extraordinary thing. An immutable, unhackable distributed database of digital assets. This is a platform for truth and it’s a platform for trust. The implications are staggering, not just for the financial-services industry but also right across virtually every aspect of society.

Most blockchains—and Bitcoin is the biggest—are what you call permission-less systems. We can do transactions and satisfy each other’s economic needs without knowing who the other party is and independent from central authorities. These blockchains all have a digital currency of some kind associated with them, which is why everybody talks about Bitcoin in the same breath as the blockchain, because the Bitcoin blockchain is the biggest.

But to me, the blockchain, the underlying technology, is the biggest innovation in computer science—the idea of a distributed database where trust is established through mass collaboration and clever code rather than through a powerful institution that does the authentication and the settlement.

The way it works is, if I owe you $20, we do the transaction. There’s a huge community called miners, and they have a powerful computing resource. Some people have estimated that the entire computing power of Google would be 5 percent of this blockchain-computing power, for the Bitcoin blockchain. That platform solves this big, big problem called the double-payment problem. If I send you an MP3 file and I send it to somebody else, it’s a problem for the record industry, but it’s not a massive problem. If I send you $20, and I send the same file to somebody else, that’s a big problem. It’s called fraud, and the economy stops if you have a monetary system based on that. What happens is, I send you the $20, and these miners, to make a long story short, go about authenticating that the transaction occurred.

Each miner is motivated to be the first one to find the truth, and once you find the truth, it’s evidence to everybody else. When you find the truth and you solve a complex mathematical problem, you get paid some money, some Bitcoin. For me to hack that and try and send the same money to somebody else, or for me to come in and try and take your $20 worth of Bitcoins, is not practically possible because I’d have to hack that ten-minute block. That’s why it’s called blockchain, and that block is linked to the previous block, and the previous block—ergo, chain. This blockchain is running across countless numbers of computers. I would have to commit fraud in the light of the most powerful computing resource in the world, not just for that ten-minute block but for the entire history of commerce, on a distributed platform. This is not practically feasible.

So, sure, there have been lots of problems with Bitcoin. You had big exchanges like Mt. Gox fail. You had the Silk Road, where Bitcoin was the payment system for all kinds of horrific, illegal activity. But don’t be confused by that. Many people make the mistake of thinking, “Bitcoin? Well, that’s an asset. Should I invest? Is it going to go up or down?” Well, that’s not of interest to me, just like speculating in gold is not of interest to me.

Something that’s of bigger interest is Bitcoin as a digital currency that enables us to do these kinds of transactions. A cryptocurrency that’s not based on nation-states. The most important thing that we focus on in our work, is the much bigger question, this underlying, distributed-database technology that enables us to have a truthful and immutable record of everything.

How disruption can occur

The financial-services industry is up for serious disruption—or transformation, depending on how it approaches this issue. For the research for Blockchain Revolution, we went through and identified eight different things that the industry does: it moves money, it stores money, it lends money, it trades money, it attests to money, it accounts for money, and so on.

Every one of those can be challenged.

You pick any industry, and this technology holds huge potential to disrupt it, creating a more prosperous world where people get to participate in the value that they create. The music industry, for example, is a disaster, at least from the point of view of the musicians. They used to have most of the value taken by the big labels. Then, along came the technology companies, which took a whole bunch of value, and the songwriters and musicians are left with crumbs at the end. What if the new music industry was a distributed app on the blockchain, where I, as a songwriter, could post my song onto the blockchain with a smart contract specifying how it is to be used?

Maybe as a recording artist posting my music on a blockchain music platform, I’ll say, “You listen to the music, it’s free. You want to put it in your movie? It’s going to cost you this much, and here’s how that works. You put it in the movie, the smart contract pays me.” Or how about using it for a ring tone? There’s the smart contract for that.

This is not a pipe dream. Imogen Heap, who’s a brilliant singer-songwriter in the United Kingdom, a best-selling recording artist, has now been part of creating Mycelia, and they’re working with an amazing company called Consensus Systems, that’s all around the world, blockchain developers, using the Ethereum platform; Ethereum is one blockchain. She has already posted her first song onto the Internet. I fully expect that many big recording artists will be seriously investigating a whole new paradigm whereby the musicians get compensated for the value that they create.

What could go wrong?

I’m not a futurist. I think the future’s not something to be predicted—it’s something to be achieved. What we’re arguing is that this technology is revolutionary and holds vast potential to change society.

What could go wrong? We identified ten showstoppers and we went through them in detail in our research and in the book. There are showstoppers such as the energy that’s consumed to do this, which is massive. Another showstopper is that this technology is going to be the platform for a lot of smart agents that are going to displace a lot of humans from jobs. Maybe this whole new platform is the ultimate job-killer.

The biggest problems, though, have to do with governance. Any controversy that you read about today is going to revolve around these governance issues. This new community is in its infancy. Unlike the Internet, which has a sophisticated governance ecosystem, the whole world of blockchain and digital currencies is the Wild West.

It’s a place of recklessness and chaos and calamity. This could kill it if we don’t find the leadership to come together and to create the equivalent organizations that we have for governance of the Internet. We have the Internet Engineering Task Force, which creates standards for the Net. We have Internet Governance Forum, which creates policies for governments. We have the W3C Consortium, which creates standards for the Web. There’s the Internet Society; that’s an advocacy group. There’s the Internet Corporation for Assigned Names and Numbers (ICANN), an operational network that just delivers the domain names. There’s a structure and a process to figure out things. Right now, there’s a big debate that continues about the block size. We need a bigger block size to be able to handle all of the transactions that will be arising. There are big differences. There are legitimate points of view, but the problem is, there’s no process to be able to come up with an optimal solution.

I’m hopeful, even optimistic, that this will proceed. It feels a lot like the early ’90s to me. You’ve got all the smartest venture capitalists, the smartest programmers, the smartest business executives, the smartest people in banking, the smartest government of people, the smartest entrepreneurs all over this thing. That’s always a sign that something big is going on. Is it an irrational exuberance? I don’t know. Last year, $1 billion went into venture alone in this area. I’m more hopeful because I can see the power of the applications to disrupt things for the good. Rather than just redistributing wealth, maybe we could change the way wealth is distributed in the first place. Imagine a Kickstarter-like campaign to launch a company where you have 50 million investors and everybody puts in a couple of dollars, or very small amounts.

Imagine all those people who have a supercomputer in their pocket, who are connected to a network but don’t have a bank account, because they only own a couple of pigs and a chicken. That’s their bank account. Imagine if they could be brought in, 2 billion people, into the global financial system. What could that do? Seventy percent of all people who own land have a tenuous title to that land. And you’re in a developing-world country in Latin America, and some dictator comes to power and he says, “Well, you may have a piece of paper that says you own your little farm, but my central computer says my friend owns your farm.”

Imagine a world where foreign aid didn’t get consumed in the bureaucracy but went directly to the beneficiary under a smart contract? Rather than a $60 billion car-service aggregation, why couldn’t we have a distributed app on the blockchain that manages all these vehicles and handles everything from reputation to payments? Ultimately, they’ll be autonomous vehicles moving around. Or blockchain Airbnb? This is all about the value going to the creators of value rather than to powerful forces that capture it. In the process, we can protect our privacy. Privacy is a basic human right, and people who say “It’s dead—get over it” are deeply misinformed. It’s the foundation of a free society.

Imagine each of us having our own identity in a black box on the blockchain. When you go to do a transaction, it gives away a shred of information required to do that transaction and it collects data. You get to keep your data and monetize it if you want, or not. This could be the foundation of a whole new era whereby our basic right to privacy is protected, because identity is the foundation of freedom and it needs to be managed responsibly.

We’ve been unable to do that, so far. I’m compelled most by the power of this opportunity. I’ve been at this 35 years, writing about the digital age. I’ve never seen a technology that I thought had greater potential for humanity.

For more about Blockchain Revolution: How the Technology Behind Bitcoin is Changing Money, Business, and the World, visit the book’s publisher’s page.


Original Content from: http://www.mckinsey.com/industries/high-tech/our-insights/how-blockchains-could-change-the-world

Reading: How to get rich in America (B2/C1)

AMERICANS are admirably optimistic about shaping their own future. One survey found that nearly three-quarters of Americans thought hard work was a “very important” component of success, while just 62% put it down to a good education and less than a fifth to coming from wealth. But the United States ranks poorly compared to other advanced economies when it comes to income inequality and social mobility. So what must an ambitious young American do to get rich?

Stanford University Graduates
Stanford University Graduates

A new study by Raj Chetty of Stanford University and a collective of other economists helps answer this question. By matching data from the Department of Education with 30m tax returns, Mr Chetty and his colleagues have constructed a data set that reveals to researchers both the income distributions of graduates of particular colleges, and how incomes vary depending on how rich the graduates’ parents were. The data show that attending an elite college is a good way of securing an upper-middle class lifestyle—graduates of Ivy League-calibre universities have roughly the same chance of breaking into the top 20% of the income distribution, regardless of family background. Paths to the upper-middle class exist for those who graduate from lesser-known universities too, since earnings can depend even more on what one studies than where. On average, graduates of lesser-known engineering colleges such as Kettering University and the Stevens Institute of Technology do just as well as those from the Ivy League.

Wall-Street-Lower-Manhattan-53049
Wall Street, Manhattan

But a good education alone cannot propel the merely upper-middle class into the ranks of the rich. Few engineers, nurses or pharmacists make it to the top 1%, which is dominated by bankers and other financiers. Recruiters in the financial industry place high premiums on pedigree. Here the Ivies play an outsize role; products of elite private universities such as Harvard and Yale are much more likely to end up on Wall Street. Moreover, data from Mr Chetty and colleagues show that it helps to start off rich in the first place.

This trend is even more pronounced at the very top of the income distribution. Between 1999 and 2004, just 2% of Princetonians came from the families in the lowest 20% of earnings, while 3.2% came from families in the top 0.1%. The admissions process at top colleges is sometimes further skewed by the preferential treatment given to family members of alumni. Of Harvard’s most recently admitted class, 27% had a relative who also went to that “college near Boston” (pictured). That suggests that the simplest way to become extremely rich is by being born to the right parents. The second-easiest way is to find a rich spouse. If neither approach works, you could try to get into a top college—but remember that not all Princetonians become plutocrats.

 

 


The_Economist_logoOriginal content from: http://www.economist.com/blogs/economist-explains/2017/02/economist-explains-0?cid1=cust/ddnew/n/n/n/2017022n/owned/n/n/nwl/n/n/EU/email