Category Archives: Economics of Education

An Educational Experiment to Keep an Eye On

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From the Chronicle of Higher Education.

The Education Department has approved the eligibility of Southern New Hampshire University to receive federal financial aid for students enrolled in a new, self-paced online program called College for America, the private, nonprofit university has announced.

Southern New Hampshire bills its College for America program as “the first degree program to completely decouple from the credit hour.” Unlike the typical experience in which students advance by completing semester-long, multicredit courses, students in College for America have no courses or traditional professors. These working-adult students make progress toward an associate degree by demonstrating mastery of 120 competencies. Competencies are phrased as “can do” statements, such as “can use logic, reasoning, and analysis to address a business problem” or “can analyze works of art in terms of their historical and cultural contexts.”

UPDATE: More here.

What Charter Schools Can Accomplish

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The Walton Family Foundation reports,

Peer-reviewed, forthcoming research finds that charter school students receive an average of $4,000 less for their education than peers in traditional public schools in five major cities, all of which are foundation Investment Sites. While the gap is widening in some cities and narrowing in others, the research finds that traditional public school students receive substantially more local, state and federal funds than those who attend public charter schools.

For the pointer, I thank a loyal reader. As you know, I am very skeptical that any educational intervention can disprove the null hypothesis of no improvement in long-term outcomes. By the same token, I am highly disposed to believe that we could lower spending considerably without affecting outcomes. In my view, charter schools might be a tool for accomplishing that. However, keep in mind that from an interest-group perspective, maintaining spending on schools at the highest possible level is more important than anything having to do with outcomes.

Note also Jason Bedrick’s summary of a report summarizing many studies that find school choice either having modest benefits or no effect–but never showing a negative effect.

What I am Reading

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1. The Rule of the Clan, by Mark S. Weiner. The best book I have read this year. After I re-read it, I will write a longer review. Meanwhile, a terse summary of what he has to say:

a) We have seen social orders without a centralized state.
b) However, these decentralized social orders are clan-based, with norms that are not consistent with peace, free commerce, or individual autonomy.
c) Without a strong central state, humans will revert to clan-based systems of social order.

I found his case for (b) to be very strong and interesting. I thought his case for (c) was somewhat weaker. Regardless, it is a very stimulating book, in part because it is very distinct from the economics and public choice literature.

2. Paying for the Party, by Elizabeth A. Armstrong and Laura T. Hamilton. Remember when I linked to a story about the book? I read the introduction and the two final chapters, and I skimmed the rest. On p. 220,

The finding that regional schools facilitated mobility more than the state flagship is at odds with existing research…William G. Bowen and colleagues use longitudinal survey data to conclude that students are best served when they attend the most prestigious school they can. Our findings suggest a qualification: If the more prestigious school available is a party school, students from less privileged backgrounds may be better off going to a less prestigious school

3. The Sleepwalkers, by Christopher Clark. For me, any book by a respected historian on the origins of the first world war becomes self-recommending. Even though this topic is, as Charles Kindleberger referred to the topic of the origins Industrial Revolution, a “well-squeezed orange.” I am less than half through this one. Clark’s description of the Serbian nationalists makes them sound like today’s Muslim fanatics in Pakistan. That is, they were secretive, organized into cells, integrated with key government agencies that nonetheless denied involvement, with a grandiose ideology, believing that they are the true representatives of a great ethnic power, and eager to instigate a larger conflict.

More on Schooling, Deschooling, and the Null Hypothesis

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Four links.
1. A NYT article on computerized grading of essays. I highlight the response of the Luddites:

“My first and greatest objection to the research is that they did not have any valid statistical test comparing the software directly to human graders,” said Mr. Perelman, a retired director of writing and a current researcher at M.I.T.

He is among a group of educators who last month began circulating a petition opposing automated assessment software. The group, which calls itself Professionals Against Machine Scoring of Student Essays in High-Stakes Assessment, has collected nearly 2,000 signatures, including some from luminaries like Noam Chomsky.

“Let’s face the realities of automatic essay scoring,” the group’s statement reads in part. “Computers cannot ‘read.’ They cannot measure the essentials of effective written communication: accuracy, reasoning, adequacy of evidence, good sense, ethical stance, convincing argument, meaningful organization, clarity, and veracity, among others.”

Suppose, for the sake of argument, that the software does poorly now and can be fooled easily. My bet is that within five years there will be software that can pass a Turing test of the following sort.

a. Assign 100 essays to be graded by four humans and the computer.

b. Show the graded essays to professors, without telling them which set was computer-graded, and have them rank the five sets of essays in terms of how well they were graded.

c. See if the computer’s grading comes in higher than 5th.

While we are waiting for this test, the NYT article points to a nice paper by Mark D. Shermis summarizing results of a comparison of various software essay-grading systems.

2. Isegoria points to Bloom’s 2-Sigma Problem,

The two-sigma part refers to average performance of ordinary students going up by two standard deviations when they received one-to-one tutoring and worked on material until they mastered it, and the problem part refers to the fact that such tutoring doesn’t come cheap.

I am skeptical. It is possible that this educational intervention is so radically different from anything else that has ever been tried that it works much better than other interventions. But I would bet that if another set of researchers were to attempt to replicate this study, they would fail to find similar results. In social science in general, we do too little replication. This is particularly important when someone claims to have made a striking finding.

3. In the comments on this post, I found this one particularly interesting and articulate:

I think K-12 public schools are about warehousing children, giving parents childcare, whether they are at work or simply want a break from being around their kids (the quality of parenting going on is incredibly wide-ranging).

…why the current system is still in place-Cost, Convenience, Comfortability and Childcare. Unfortunately, the one-size-fits-all approach is ineffective, makes young people passionately hate school (which breeds some serious anti-intellectual pathologies) and is becoming even more centralized in curriculum and control. (See Common Core curriculum adopted by 48 states.)

I think that the Childcare aspect deserves more notice. When President Obama supports universal pre-school, the “scientific” case is based almost entirely on taking kids out of homes of low-functioning parents. But what affluent parents hear is “Obama is going to pay for my child care,” and that is what makes the policy popular.

More generally, assume that as a parent you believe that your comparative advantage is to work, rather than spend the entire day with your child. Then ask yourself why as a parent you would prefer to have your child in school rather than home without supervision. Even if the child learns less at school than they would at home, you still might prefer the school, as long as you are convinced that it reduces the risk of your child getting into really bad trouble.

4. From Michael Strong, in a long comment pushing back on my post last week.

No one doubts that if one compares one group that receives significant practice in an activity against another group with no exposure to the activity at all, that a treatment effect exists.

Why then are so many people skeptical that interventions in education make a difference? Largely because the comparisons exist between idiotic variations within a government-dominated industry.

As a rejoinder, I might start by changing “receives significant practice” to “engages in significant practice.” “Learning a skill” and “engaging in significant practice” are so closely related that I would say that, to a first approximation, they are the same thing.

This leads me to the following restatement of the null hypothesis.

The null hypothesis is that when you attempt an educational intervention, such as a new teaching method, the overall economic value of the skills that an individual acquires from age 5 to 20 is not affected by that intervention. I will grant that if you take two equivalent groups of young people and give one group daily violin lessons and the other group daily clarinet lessons then the first group is more likely to end up better violinists on average.

But when economists measure educational outcomes, they usually look at earnings, which result from the market value of skills acquired. To affect that, you have to affect the ability and willingness of a person to engage in practice in a combination of generally applicable fields and fields that are that person’s comparative advantage.

Aptitude and determination matter. Consider Malcolm Gladwell’s “10,000 hour rule” for becoming an expert at something. There is a huge selection bias going on in that rule. How many people who have little aptitude for shooting a basketball are going to keep practicing basketball for 10,000 hours?

When you consider how hard it is to move the needle half a standard deviation on a fourth-grade reading comprehension exam, the chances are slim that you are going to come up with something that affects long-term overall outcomes. Until we get the Young Lady’s Illustrated Primer.

The Minerva Project

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David Brooks mentions it. InsideHigherEd describes it.

While MOOCs are basically supersized lectures offered to tens of thousands rather than hundreds of students, Minerva wants to use learning analytics to scale up Oxbridge-style tutorials to seminar-size online classes taught by professors who can work remotely from any location in the world.

…This, Nelson says, will avoid the limitation of the in-person lecture — namely that whatever is said just “vanishes into thin air.”

Thanks to Tyler Cowen for the pointer.

This sounds interesting. I was hoping to create a virtual seminar when Nick Schulz and I used Google+ hangouts. Here is where we discussed Charles Murray’s book Coming Apart.

I liked the seminars when I was at Swarthmore College. Each week the seminar met, one or two students would be assigned to write short papers to be the center of discussion. For example, I once was assigned a paper on the “cobweb model,” in which farmers base next year’s output on this year’s price. After much painful thinking, I denounced this model as irrational. On my own, I located John Muth’s paper, but I could not follow the math. What I came up with on my own instead was essentially the hypothesis of perfect foresight. It turned out, unbeknownst to me, that right at that time the topic of “rational expectations” was about to take the economics profession by storm.

The other characteristic of Swarthmore that I also have championed is the outside examiner. That is, the professor who puts together the syllabus and leads the class is not the same as the professor who puts together the assessment and grades the students.

I hope Minerva is successful with the idea of virtual seminars. I think that the risk is that it is positioned in a sort of no-man’s land, in between the backward model of existing universities and some more radical model of self-directed education that will emerge over the next decade. On the latter, look at these Unschooling Conferences, such as the Trailblazer gathering. Right now, these conferences signal the participant’s weirdness (as Bryan Caplan would predict), but if that should tip….

Chris Peterson is a Minerva skeptic.

If Minerva has higher standards then Harvard, than how is a student who can’t get into Harvard supposed to get into Minerva?

Read the entire rant. I, too, am skeptical. I remember Chris Whittle’s big education venture, called The Edison Project. It was pretty much all hat and no cattle, as they say in Texas. I was wary when he hired Benno Schmidt of Yale for a lot of money. I think if you are going to be an outside force disrupting education, you need to be an outside force. Somebody who has achieved prestige in the existing system is less likely to have the drive and originality to change it.

If I had a lot of VC money to do a project to execute a higher education start-up, I would consult with creative, unhappy professors at low-prestige places to mine their ideas. That said, I would not put them onto the management team. Unhappy people are unhappy people, so I would go with a non-academic management team to keep things sane. You can get inspiration from crazy, unhappy people, but they don’t do well in organizations.

Speaking of organizations, Henry Brighous writes,

While Fisman and Sullivan don’t really comment on this – they simply go on to describe the other kinds of coordination that AA undertakes – it’s hard for me to see how firing an employee simply for explaining how the internal process works to good effect could be efficient. It doesn’t provide any clear, useful incentives to improve overall efficiency. Nor is it conducive to a happy and productive employee culture. The simplest explanation is that Mr. X got fired because his bosses were self-aggrandizing *****s, who saw any public commentary as potential insubordination to be ruthlessly punished, even if this made for a more dysfunctional organization.

To get the context, you have to read the post, and perhaps read the book that he is discussing.

I remember when a project manager at Freddie Mac organized a session where team members could air their gripes. When she had heard all of the complaints about the stupidity and disorganization of the higher-ups, she said told the group that they should be happy that Freddie Mac wasn’t perfect, because if it was already perfect none of them would have jobs.

Indeed, one way to think of an organization is as a mountain of dysfunction. The job of managers at all levels is to try to chip away at that dysfunction. Maybe Henry is correct that Mr. X got fired because his bosses were jerks, but maybe Mr. X got fired because instead of chipping away at the dysfunction, he was contributing to it. I am not saying that I think he should have been fired. I have no idea. Corporate soap opera is complicated.

The Null Hypothesis in Education is Hard to Disprove

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Tyler Cowen reports on a study that shows no difference between students taught traditionally and students taught with a blended-learning approach (combining on-line and in-person teaching). Tyler entitles his post The Hybrid Educational Model Works. I would only have said that if the blended-learning approach were shown to be better.

In education, the null hypothesis is that nothing makes a long-term, scalable, replicable difference. That is:

1. Take any pedagogical innovation or educational intervention.

2. Subject it to a controlled experiment.

3. Evaluate the experiment’s outcome several years later.

4. If the experiment works, attempt to replicate the experiment in more situations.

By the time you reach step 4, if not sooner, you will be unable to show that the innovation makes any difference in outcomes. What this suggests to me is that in the long run it is the characteristics of the students that determine outcomes, at least on average. Think of an individual student as “predestined” to reach a certain outcome. An educational intervention can disturb their path to the predestined outcome but will not change the outcome. I do not literally believe this model, but it is a null hypothesis that is difficult to disprove.

Visualize Whirled Peas

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Bryan Caplan writes,

Everyone is used to the existence of government. If the police were suddenly replaced by a dozen private police firms, people would expect CEOs to say, “Let’s attack the competition and become the new government.” Since people would expect this, many CEOs would expect such a proposal to succeed – and some would advocate it. Since these CEOs wouldn’t sound crazy, many of their underlings would go along with their plan – and their plan (or a rival’s) would probably come to fruition.

So far, so bad. Suppose however that a stable anarcho-capitalist system existed. Then this logic reverses. Since everyone is used to this system, people expect private police firms to amicably resolve disputes. In such a setting, a CEO who advocates a war of conquest would seem crazy – and his pleas to his co-workers would fall on deaf ears. In a stable anarcho-capitalist society, a war-mongering CEO doesn’t get a war. He gets fired.

Bryan makes a similar point subsequently.

Is the equilibrium locally stable or globally stable? Think of a roulette wheel stopped with ball resting in number 12. If there is a small disturbance, such as slowly spinning the wheel, the ball will remain where it is, in a locally stable equilibrium. However, if you take the ball out and spin the wheel, the ball could land in any slot. There is nothing globally stable about number 12. If it turns out that no matter where the ball starts it always lands on number 12, a gambler would say that the wheel is fixed*, and an economist would say that 12 is a globally stable equilibrium.

Bryan is arguing that democratic government is only locally stable. If the roulette wheel enabled us to land on anarcho-capitalism until we got used to it, we would not return to democratic government. A similar argument might be made about higher education. If the roulette wheel landed us in a culture in which not going to college is regarded as higher status than going to college, then we would not return to treating a college degree as important.

My own view is that the college equilibrium is not globally stable but that the democratic government equilibrium is globally stable. That is, I think that once the college equilibrium becomes sufficiently disturbed, it will never return. However, in the absence of government, my guess is that social norms would not be sufficiently strong to protect people from defecting coalitions. I think that government is likely to return.

*(meaning that it has been tampered with to make it unfair)

State Universities Be Damned

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By this story.

The result of this “party pathway” is more than just a substandard education for those students, whose significant family resources and connections — which set them up for jobs after graduation, regardless of credentials — allow them to take easy majors and spend as much time if not more drinking as they do studying. It also deters those on the “mobility pathway,” as those low-income students seeking entry into the middle class are both poorly supported and distracted by the party framework. As a result, many of these students struggle to succeed — meandering through college for six years or more — or drop out altogether.

Read the whole thing. It might be the most damning article ever on higher education (and makes me curious to read the book).

Deschooling Society

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My latest essay.

within a decade or two, the idea that learning can be located in time and space will no longer seem natural. The essence of the revolution that I foresee will be our embrace of anywhere-anytime learning. It could be that schooling as an institution will adapt to this paradigm, but I would bet against it.

Meanwhile, a more moderate proposal (still radical by today’s standards) is to get rid of school districts. As Bruno Behrend points out, the case against school districts is a strong one. Still,

people can’t yet envision an education system without the bureaucracy, powerless boards, “group rights” (what a frightening, tribal, concept), and the millions of unnecessary jobs that school districts force upon us.

As I have said before, people are really afraid of letting go of coercion in education. They think that we need adults to be in a position to coerce children, school officials need to be in a position to coerce parents and teachers, local politicians need to be in a position to coerce school officials, state politicians need to be in a position to coerce local officials, and national politicians need to be in a position to coerce state politicians. And, of course, teachers’ unions need to have particularly strong power.

Is the Demand for Skill Falling?

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Paul Beaudry, David A. Green, and Benjamin M. Sand have a paper with an intriguing abstract, which says in part,

Many researchers have documented a strong, ongoing increase in the demand for skills in the decades leading up to 2000. In this paper, we document a decline in that demand in the years since 2000, even as the supply of high education workers continues to grow. We go on to show that, in response to this demand reversal, high-skilled workers have moved down the occupational ladder and have begun to perform jobs traditionally performed by lower-skilled workers. This de-skilling process, in turn, results in high-skilled workers pushing low-skilled workers even further down the occupational ladder and, to some degree, out of the labor force all together.

If true, this would upset nearly everyone’s narrative apple cart, including mine.