She’s partly right. She’s right that independently schooled pupils perform better at A-levels, on average. It’s also true that Oxford and Cambridge have very high entry standards, which favours independently-schooled pupils. However, that does not fully explain the low rate of admission for state-schooled pupils.

It’s fairly easy to check because the percentage of state-schooled pupils admitted is one of the Performance Indicators published by HESA each year for all universities. The indicators helpfully include a benchmark that accounts for, among other things, the entry qualifications of students. That means we can compare the actual state-schooled intake for each university against a benchmark that takes Ms Hartley-Brewer’s concerns into account, along with other considerations, such as age, ethnicity and sex.

The chart below shows that we would not expect Oxford and Cambridge to take a high proportion of state-schooled pupils, largely because of their high entry requirements. However, even against that adjusted benchmark, they underperform.

…distributional analysis is helpful. It helps inform the debate, and … shows how money is allocated by Government around the different income quintiles of society.

HM Treasury’s draft results have now been published. They show that low income households suffered the smallest pre-tax fall in income through the recession.

That is not entirely representative of low-income households’ experience because they were disproportionately exposed to unemployment, but it is interesting to see that upper-middle-income households saw the greatest fall in wages during the recession.

The impact of changes to taxes and welfare payments over the last Parliament has attempted to reverse those costs by penalising those on low incomes with sharp cuts to benefit rates. However, reductions in direct taxation have largely benefited middle-income households.

The Treasury’s draft analysis highlights that:

• The majority of the tax burden has fallen on the top decile of income earners.
• The cuts to tax credits and benefits have more than offset the cuts to direct taxation for low-income households and left them worse off
• Director’s Law held over this Parliament.

Unfortunately, Osborne announced alongside this release that, despite his earlier enthusiasm:

The Treasury will not be producing analysis of this kind for future fiscal events.

Of course, that’s not necessarily a causal link and Ben Southwood rightly pointed out that, in the US, similar results are due to differences in the subjects that male and female students study. However, that doesn’t appear to be the case in the UK:

These correlations aren’t in any way conclusive, but they’re hardly reassuring for people who think the wage gap between men and women has been eliminated. Importantly, it’s only through transparent discussion of these outcomes and the possible mechanisms that we will overcome the societal problems that caused the wage gap. Avoid those questions by opposing pay transparency will not make the problem go away, nor silence the critics.

If a man is not a socialist by the time he is 20, he has no heart. If he is not a conservative by the time he is 40, he has no brain.

Why austerity?
Osborne claimed that his rapid deficit reduction improved confidence across the economy, which caused demand to recover and growth to return.

Why a fiscal rule requiring an overall surplus in every year?

• Paying down debt in time of growth makes sense, so a surplus is required.
• Rules based on cyclically-adjusted measures and forecast targets—such as the present, five-year rolling structural current balance requirement—have huge measurement problems, which makes them a less effective constraint on Government policy.
• He felt that the debt targets, which were anchored to a particular year, were the harder constraint on his actions in the past Parliament. The new requirement for a surplus each year is a similarly hard constraint and is intended to be so to effectively constrain future Chancellors.
• The overall surplus is used instead of the current balance for two reasons: splitting current from capital expenditure allows gaming of the rules, and also leads to an undesirably negative framing of current expenditure.

Ring fences
Osborne was unapologetic about using ring-fences to protect particular areas of Government spending. He characterised them as simple heuristics that clearly set out the spending priorities of the Government.

The core point is that people get buyer’s remorse when choices are reversible and become increasingly unhappy with their decision. When choices are irreversible, endowment effects kick in and they become happier with their choice over time. Importantly, most people do not realise that this effect exists.

• Does this have implications for choice architecture? Would it be beneficial to make some choices irreversible to increase the utility gained from them?
• If people are unaware of the effect, will they under-utilise commitment mechanisms that make decisions irreversible?

In a ray of light, this morning’s FT (£) reported a study of over 15,000 German employees that examined the relationship between ageing and productivity. One of the authors is quoted saying:

As workforces age, employers are concerned that productivity will decrease. That is not so. What matters is not chronological age but subjective age.

The research suggests that older people are systematically excluded from training activities, and are relegated to less creative and meaningful work, which renders them less productive. As the workforce ages, that may begin to change. As it changes, the relationship between growth and age structures is likely to weaken.