Both of you have switched research areas over your careers. What prompted the switching?
Ladd: I wasn’t sure I had anything new to say around state and local finance. The same issues were coming up over and over again. Also, in the early 1990s, state and local governments were flush with revenue while education was moving to the front burner; with the No Child Left Behind Act in 2001, an increasing amount of data were becoming available. I had known a lot about school finance, because that’s a big part of state and local finance. Economists had something to say about promoting more effective use of resources in schools and about choice and competition.
Cook: I had studied labor economics, and I had also been interested in how people make decisions, which led at one point to why people play the lottery and how they understand that choice. Just because a big box of data fell into my lap, I had the opportunity to study parolee recidivism and how that relates to their job opportunities— that was my dissertation. I had an opportunity to work with crime data in Washington, which was how I got involved in researching gun control. And the National Academy of Sciences appointed me to the expert panel on alcohol control; they thought expertise on guns might transfer into alcohol.
Ladd: When you’re doing research on policy-related issues, one issue opens up others. At one point I wrote a book on fiscal problems of U.S. cities. There was a need for more federal aid for cities, but it wasn’t going to come. Then you start thinking about other ways to help cities. So I wrote about how to attract businesses into cities. Then you realize when those businesses come in, a lot of people don’t have the skills needed for those jobs. That leads to the question, how can you improve their skills? And that leads to issues related to education.
Choice, in some form, is a recurring theme for the two of you, right?
Cook: In the area of alcohol and drug abuse, there’s this concept of the addict who has no control over his behavior and so would not be influenced by the normal incentives. Another example is around the huge increase in youth violence that occurred in the late 1980s; the most prominent explanation featured “super-predators,” young men of violent character who were thought to have been programmed to behave in a certain way. In both cases the perception did not allow for the possibility of adaptability or responsiveness to changes in the environment. But if you can change the environment of opportunity, then you can change the behavior.
Ladd: Choice is high on the policy agenda right now. The first charter schools were developed in Minnesota in the early 1990s. Along with choice of school comes the argument for more autonomy for schools, because choice doesn’t matter if all the schools are uniform. I’m not opposed to choice. But there are a lot of things about the K-through-12 education sector that make it important to people’s life chances. We make it compulsory, and we’re willing to fund it publicly. Parents and children are going to look out for their own interests, but the public sector has a clear role in making sure that all children in a community receive a high-quality education.
You’re both experts on vexing policy issues, but policy hasn’t always gone where your research would have led it. How frustrating is that?
Cook: The questions that a policy researcher wants to answer are often defined by a public debate. That was evident with the work I did on the cost of the death penalty. The chief justice of the North Carolina Supreme Court thought we needed to know whether the death penalty saves money or costs money to taxpayers. Then the president of the Joyce Foundation thought we needed to know the cost of gun violence, as part of the debate over combatting gun violence. But I also take pride in the methodological advances, the theoretical advances I’ve made. If I had to evaluate my career based on my influence on policy, I would be clinically depressed; the policy drift has been in what I consider the wrong direction.
Ladd: I view myself as having had big impacts on policy, but not directly. What I’m trying to do is to change the way people—especially my students— think about issues. And policy is a process. Ideally it’s a process in a positive direction, but sometimes there’s backsliding.
Cook: Milton Friedman is an interesting case in point. Friedman had ideas that seemed completely out of touch with the times—a negative income tax, drug legalization, school vouchers. But over the course of generations, those ideas filtered down, and economists who studied those ideas eventually were in a position to influence policies. So it’s fundamentally about putting ideas out there. If they’re good enough or compelling enough, perhaps over time they can begin to have great power and influence.
What’s the biggest misperception in your areas of research that you’d like to see corrected?
Ladd: The idea of test-based accountability for schools, and certainly for individual teachers, is terrible. We need some sort of accountability. But other countries, for example, use a system of trained inspectors who go into the schools, and that provides information to the schools to help them improve. No Child Left Behind focuses on test scores. But it’s debatable whether it even raised test scores.
Cook: I always find myself arguing with the idea that incentives don’t matter. If I were asked, “What is the ideal way of financing the government?” it would be pretty much to tax bad and harmful behavior, whether it’s the use of alcohol and tobacco or carbon emissions.