Kids these days

Tag: Kids these days

Lawrence Students v. Card-Carrying Economists

In the previous post, I mentioned the Robert Whaples survey of American Economic Association (AEA) members on their public policy views.  Of course, Whaples isn’t the only one with access to Survey Monkey, and with the help of some of my colleagues, we gave the same survey to students in Freshman Studies, Economics 100, and Economics 300 courses.

The Freshman Studies sample (n=26) should be fairly representative of incoming freshman population, as every student takes freshman studies and these students are allegedly distributed randomly across the sections.  I have data from two sections with a 90% response rate. The Econ 100 course is predominantly freshman as well, but is a much different cross section of the University, with 70% planning to major in economics or some other social science.  The Econ 300 is, of course, generally for students taking the first “major” step to joining Team Econ down here on Briggs 2nd.  It is well-worth noting that the Econ 100 (n=35) and Econ 300 students were surveyed at the beginning of the course,* not the end.   Perhaps next year we will switch that up.

The survey participants rate the questions on a 1-5 scale, with 1 being strongly disagree and 5 being strongly agree.

Here are selected results, sorted by the scores of AEA members:


Continue reading Lawrence Students v. Card-Carrying Economists

Nobody’s bailing, nobody’s sailing, but we’re watching it from shore

Schumpeter Roundtable’s Cecily McMillan is featured in today’s Appleton Post-Crescent.

A 22-year-old government major from Atlanta, Ga., McMillan is the granddaughter of Harlon Joye, an early member of Students for a Democratic Society (SDS), a 1960s organization that helped fuel the nation’s civil rights movement, fought for economic justice and participatory democracy and protested the Vietnam War.

Ms.  McMillan has been busy down in Mad-town, even organizing a Tuesday bus trip.  Yet, she still found time to come and talk about Capitalism, Socialism, and Democracy.

No mention of Schumpeter in the article, but she undoubtedly had a well dog-eared copy with her on the bus.

Schumpeter and the Fashion Industry

Today we are treated to a discussion of the fashion industry from Ms. Richter & Ms. Li.   The first from the Schumptoberfest collection.  Enjoy!


“The evolution of the capitalist style of life could be easily – and perhaps most tellingly – described in terms of the genesis of the modern Lounge Suit.” -Joseph Schumpeter

Creative destruction saturates the fashion industry; you must be the trend-setter otherwise the “foundation of your very life” will be in jeopardy. Large firms enjoy an advantage in spreading risk over many projects (e.g. inventions that never “catch” as a trend) and have the resources and brand power to set trends, thus helping their inventions turn into successful innovations, driving the fashion cycle forward through induced obsolescence. Due to lack of IP laws, large firms do not enjoy the monopolistic protectionism that IP rights provide, but they have other means justifying their investments. Schumpeter’s hypothesis suggests that large firms foment innovation for factors other than scale economies, and in the fashion industry, and the fashion cycle is a key example of this phenomenon.

The fashion industry, a $200 billion industry in the United States alone, is comprised of nearly 150,000 establishments, ranging in size from large fashion houses to smaller start-ups. Although there are a large number of firms competing in the industry, according to the 2002 Census, five percent of firms in the clothing industry accounted for twenty percent of total revenue and sales. These large firms, , also play an important role in the diffusion of new design trends and the continuation of induced obsolescence, the dynamic force driving the fashion cycle forward; the influence of large firms contributes to the top-down structure of the industry.

Consumers are not strictly motivated by price, but also pay attention to  brand, quality, design differentiation, or trendiness (flocking). Because of complex consumer decision-making, product differentiation and new designs are essential to driving the industry forward Raustiala and Sprigman (2009) argue that  induced obsolescence is the process by which designs, through copying and diffusion into mainstream fashion, become obsolete and therefore undesirable to fashion-forward consumers. These fashion-forward people then demand new designs, which are invented by top firms and diffused downward through trends, again, through copying. This process is called the fashion cycle. This cycle is very rapid and is completed each season.

Continue reading Schumpeter and the Fashion Industry


In this remarkable video, a professor at tells his students that he has used a statistical analysis and has determined rampant cheating in his class. I’m pretty sure what he did wasn’t a statistical analysis, but he did offer the offending students a chance to redeem themselves.

Jeff Ely from Northwestern offers some thought-provoking discussion:

So he is offering a deal to his students.  They can individually confess to cheating, attend a 4 hour ethics course and receive amnesty, or they can take the risk that they will not be caught.  What would you do?

  1. Professor Quinn’s speech reveals that the only evidence for cheating is an anonymous tip plus a suspicious grade distribution.  Based only on this the only signal that you cheated was that your score was high. But it’s not credible to punish people just for having a high score.
  2. If Professor Quinn expects his gambit to work and for cheaters to turn themselves in, then he should believe that everyone who doesn’t turn himself in is innocent.  So you should not turn yourself in.
  3. The biggest fear is that someone who you collaborated with turns himself in and he is induced to rat you out.  Then as long as you are not sure who knows you were in on the scam you should turn yourself in.
  4. It’s surprising that this possibility was never mentioned in Professor Quinn’s rant because without it, his threat loses much of its force.
  5. The fact that he didn’t raise this possibility reveals that he is not so interested in rounding up every last cheater but simply to get a large enough number to confess.  That way he can say that a lesson was learned.  This suggests that you should confess only if you think that your confession will just push the total number of confessions over that threshold.  Unlikely (unless everyone is thinking like you.)

What would you do, indeed?

Well, as it turns out, about a third of the class (200 students) threw themselves on the mercy of the court.  The sheer magnitude propelled the story into the headlines in the first place, making Professor Quinn something of a YouTube icon.

But the plot thickens.

As it turns out, the “cheating” involved was for students to get access to a test bank and studying from that.  The folks over at techdirt (techdirt?) think this sounds kind of fishy.

But watching Quinn’s video, it became clear that in accusing his students of “cheating” he was really admitting that he wasn’t actually writing his own tests, but merely pulling questions from a testbank. That struck me as odd — and I wasn’t really sure that what the students did should count as cheating. Taking “sample tests” is a very good way to learn material, and going through a testbank is a good way to practice “sample” questions. It seemed like the bigger issue wasn’t what the students did… but what the professor did.

The question seems pertinent given that Professor Quinn claimed that he wrote his own questions (video here).

Now, my guess is that the students knew that Professor Quinn used a test bank, and so their faux innocence seems kind of ridiculous.  On the other hand, I spend a lot of time writing my own tests.  Indeed, even when I taught large sections of intro (150+), I wrote my own multiple choice questions, so I’m not so sure how much sympathy is due for Professor Quinn here. And it’s not clear whether the ground he is on is all that high.

I’m not sure what the moral of the story here is, but it certainly is a remarkable case.

Where Do Good Ideas Come From?

I’m not sure, because Steven Johnson’s Where Good Ideas Come From isn’t out for a few weeks, and all I have is this four-minute video.  Well, actually, I also have this longer video from over at TED (the new Harvard, I’m told).  But as I’ve often said, movie, shmoovie, I’ll wait for the book.

Robot Traders

There’s a peculiar piece in The Atlantic about peculiar behavior of robot traders.

As usual, I have no idea what these robots are up to, but it probably isn’t about making me rich. The picture shows “an extreme closeup of just one second of trading of the stock SHG, the Shinhan Financial Group. This is 760 quotes from a total of 10,000 made in 12 seconds.”

1000 quotes per second, baby

Now, why would a robot do that?  There’s no telling with these robot traders.

My suggestion is to take these pictures and ask Professor Azzi.

I bet he has an explanation.

“I often have tender, concerned feelings for people less fortunate than me”

Is that a Mike-n-Ike?

In another sure sign of the apocalypse, college students these days just don’t care that much about their fellow man.

Compared with college students of the late 1970s, current students are less likely to agree with statements such as “I sometimes try to understand my friends better by imagining how things look from their perspective,” and “I often have tender, concerned feelings for people less fortunate than me.”

The researchers put together a survey that elicits an “empathy” score (you can take the test yourself) and today’s kids scored 40% lower than generations of yore. That seems like a lot.  From this, the authors of the study conclude that people in my generation are more likely to donate a vital organ to a complete stranger, whereas today’s generation is more prone to knock over its grandmother for the last Mike-n-Ike’s.

Seriously, though, I wonder how much today’s lower score has to do with the language of the survey.  It seems a bit dated to me.  On the other hand, it’s hard to believe anyone ever talked that way.  I also wonder how such specious unpublished research winds up at the top of my RSS feed.

I just wanted to share that with you all.  I worry, you know.  Have a good weekend!

Don’t try this at home

The administration at Louisiana State University removed a professor from the classroom for grading too harshly. Evidently, Professor Homberger gives tough multiple choice exams that aren’t curved, the logic being that “students must achieve mastery of the subject matter, not just achieve more mastery than the worst students in the course.”

I’m sympathetic to her.  Why give a student a decent grade if s/he doesn’t know what’s going on?

But, on the first exam she flunked 90% of the class, and enough of the students whined and moaned that the administration gave her the hook.

I’m sympathetic to the students. About the harsh grading, not the whining.

The irony is that her tough standards seemed to be having a positive effect: “[Homberger] said that her tough policy was already having an impact, and that the grades on her second test were much higher (she was removed from teaching right after she gave that exam), and that quiz scores were up sharply. Students got the message from her first test, and were working harder, she said.”

I think she might be on to something.  Incentives matter, as they say. And we’ve seen before,  students do seem to work harder when they aren’t handed high grades.

Fortunately for her, she’s tenured and probably would get a nice fat settlement if push came to shove here. Of course, if she wasn’t tenured, she might think twice before busting out the big red pen.

The End is Near

Many students find the end of the term the ideal time to break up with that not-so-special person they’ve been seeing.   Maybe your returns to scale in the relationship are constant or even decreasing.  Or maybe you really don’t have that much specific capital invested in the relationship (K is low).  Or, perhaps, you’ve found a relatively higher redeployment value for your affections.   If that’s the case, transaction cost theory suggests that you might consider outsourcing your break up.

That’s right, a mere $10, will get you into a “basic break up,” with escalating rates based on increasing specificity (engagement, divorce), but, interestingly, not based on increasing complexity.


Sex ratios, economics, and the campus

This interesting blog post by market designer Al Roth of Harvard University summarizes an economics paper that links the preponderance of boys in China to the high Chinese savings rate. On the other hand, women are clearly in the majority on US college campuses. (No, this doesn’t explain the US savings rate, but it has other interesting consequences.)

Making the Grade

College kids these days seem to have it easy. When I was that age, I had to walk twelve miles uphill through a blizzard to get to class, and then make a similarly brutal trip uphill to get back home. Not to mention that back then the median grade was somewhere around a C-. And this was during the easy courses in summer session.

Well, perhaps that isn’t all completely accurate, but according to a forthcoming paper by Philip Babcock in Economic Inquiry, it seems likely that we did study more back then. The key result is that students spend more time studying in classes where the expected grade is lower. So, if grade inflation leads to higher expected grades, I read that to mean that on average students will study less.

Abstract: College grade point averages in the United States rose substantially between the 1960s and the 2000s. Over the same period, study time declined by almost a half. This paper uses a 12-quarter panel of course evaluations from the University of California, San Diego to discern whether a link between grades and effort investment holds up in a micro setting. Results indicate that average study time would be about 50% lower in a class in which the average expected grade was an “A” than in the same course taught by the same instructor in which students expected a “C.Findings do not appear to be driven primarily by the individual student’s expected grade, but by the average expected grade of others in the class. Class-specific characteristics that generate low expected grades appear to produce higher effort choices — evidence that nominal changes in grades may lead to real changes in effort investment.

The emphasis is mine.

If we here in economics announced that the average course grade is a half point lower than the average campus grade, would we get harder-working students? Or just fewer students?