Grades and learning

Schools tend to go to one extreme or another when it comes to grades: they are either confidential or posted openly.

The reasons for confidential tend to involve self esteem, privacy, peer pressure and bullying. The idea is that students will be mean to each other if they know the grades of others.

This idea is a bit flawed — students can be mean in many ways, grades are feedback on work rather than evaluations of personal character, etc. — but you can see its parallel in discussions of pay at work.

The alternative of open grades is popular with those who want to show the product of potential, habits and behaviour — and how sometimes inputs do not lead to outputs. Sure, So-and-so (the model student) got an A, but what about S0-and-no (the rebel), who also got an A? Going further, open grades help students calibrate their own performance; they help groups of students compete with each other (I’ve published on this); and they force teachers to give clear objective feedback to students who will compare their work.

Learning is a process, and grades are signals of whether than process is going well. Although I’d prefer to post ALL my grades openly, I actually fall somewhere in between — I give open grades on some assignments (along side openly penalising failures to follow guidelines), but I give confidential grades on others. That’s just how things work out.

But my one-handed conclusion is that individual grades only make sense when you can compare yourself to the group. That’s how you know that your B+ is amazing (top grade on the exam!) or a disaster (everyone else got an A- or above).

We learn by comparison, so don’t ignore its potential.

How does an entrepreneur set prices?

Traditional (neo-classical) economic theory has robust models of price-setting in two extremes. In a perfect market, identical firms sell identical goods at the same price, each firm covering its marginal costs, but no firm making any profit.

But where do normal firms and entrepreneurs set their prices, based on imperfect information regarding their competition, the potential clients, and the “unique” elements of their goods/services?

Here’s a picture:

My one-handed conclusion is that economists are very sure about a very rare set of market circumstances and very unsure (or they should be!) about 99% of market participants.

Alexei Navalny, RIP

A hero under all circumstances.

We do not have many civic heroes these days — the people who fight with words rather than weapons to preserve domestic quality of life.

Three of my heroes, Clair Patterson, Jane Jacobs, and Rachel Carson, were civic heroes — they sacrificed a lot to help us all.

Another was Alexei Navalny, who was willing to die to help his fellow Russians.

Last week, Putin murdered him.

Putin didn’t murder him directly — just as MBS didn’t murder Jamal Khashoggi with his own hands — but Putin was 100 percent responsible.

I don’t think I was ever a fan of Putin, but he’s certainly turned from bad to worse since I began criticising him in 2005, but this 2009 post is better. I am not sure I would have been so brave if I was living in Russia. Navalny was beyond brave — not just criticising Putin to his face over the years, but returning to Russia to do so after Putin’s thugs failed to kill him with poison in 2o21. Navalny said: “I am not afraid of Vladimir the Poisoner of Underpants.”

That’s a hero, hands down.

I recommend these articles (“Why Russia Killed Navalny” and “The reckless heroism of Alexei Navalny“) to learn more about a leader the Russians needed but may not have deserved.

I look forward even more to Putin’s fall from power.

Who do you work for?

Economists assume that people work for themselves first, i.e., accepting payment (extrinsic motivation) to do something they would not do if they were not paid.

But that “model” ignores the role of intrinsic motivation (we do what we like) which plays a role — large or small — in determining where we work, but also how much we are willing to accept to do the work (more intrinsic motivation on offer means reduces the need for extrinsic motivation).

So it’s complicated.

Now get into the common problem of outsiders assuming you are there for intrinsic reasons when you are there for other reasons. For example:

  • You work at a non-profit, but only because of the salary (extrinsic).
  • You teach at a university but only because you want to be left alone to do research (different intrinsic reasons).
  • You say you care about the public interest but your company screws the public (extrinsic displaces intrinsic).

My one-handed conclusion is that you should not take someone’s motivational claim at face value. Better to watch to see how their behavior (revealed preference) aligns or clashes with their professed goals (stated preference).

Academics and freedom of speech

The First Amendment of the US constitution reads:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

The purpose of a constitution (ably explained in one of my favorite books) is  to protect citizens from the arbitrary exercise of power. The First Amendment thus protects (among other topics listed above) the right of citizens to speak (or write) freely.

I am a free-speech absolutist, in the sense of saying whatever you want, on any topic. I agree with the common exceptions to this freedom, except when it comes to obscenity (there, I am with Carlin).

America’s constitutional rights stop (in theory) at its borders, and governments elsewhere regulate the speech in different ways. In Germany, you cannot say many things (Nazi stuff is a famous example, as this American recently found out). In Russia, you cannot call war, “war.” In China, you cannot compare Xi to his look-alike.

On university campuses, freedom of speech is subject to different rules, since staff and students are “members of a community.” Those freedoms have been in the news recently, and I want to give my opinion as to why it’s news and how to fix the problem.

Hamas attacked from Gaza on 7 Oct 2022, killing over 1,000 Israelis (2/3rds of them civilians) in an unprecedented act of terrorism.

Side note: I am totally aware of the tension between Israel’s claims of progressive democracy and its treatment of the Palestinians (I am a “two-state solution” kinda guy), but I do not condone terrorism. America (with its religious nuts supporting the settlers), the Arab world (with its hypocrisies), and the Palestinian Authority (with its massive corruption) have really screwed over the Palestinian people, but that’s no excuse for terrorism.

Anyway, the reason we’re here is to talk about freedom of speech on universities, and the example that got everyone’s attention was the 7 October statement by the Harvard Undergraduate Palestine Solidarity Committee, which held “the Israeli regime entirely responsible for all unfolding violence.” Thirty-three student groups at Harvard co-signed that statement. Remember that this was before Israel began its retributions and invasion of Gaza, which has killed tens of thousands of civilians.

So the context is that Harvard’s administration tolerated THAT speech, in contrast to a lot of OTHER speech that Harvard has NOT tolerated. (FIRE may be biased, but facts are facts.) And Harvard is not alone.

So we’re talking about hypocrisy — your speech is bad, my speech is good — rather than anything close to a level playing field in how elite (private) universities handle topics that are favored by the left/hated by the right.

Related: This article points out that politicians — unable to regulate speech at private universities — are attacking speech at public universities, which they should not do. Elite media, such as the New York Times, are also suffering from hypocrisy, in terms of whose opinions are allowed and — worse — in terms of their news reporting. Read “When the New York Times lost its way.”

So, what “we” (Americans, but also citizens in the free world) risk here is a decay in our right to free speech, as various authorities “protect” us from “harmful” speech. That path, as Benjamin Franklin warned in 1722 (!), will deliver neither liberty nor safety.*

So, to recap: One side killed a bunch of people on the other side. Students spoke in favor of the killers, without condemnation from campus administrators who have shut down speech from the other side. I disagree with that history of censorship, since all sides should be able to speak.

So how did we get “here”? How did US academics become tolerant of one kind of speech but not another?

Whelp — it’s time to blame the mathematicians. No, the economists. No,  it’s the politicians (again) — as in the university politicians, or administrators (super insightful read).

Let me spell it out…

There’s been a huge interest in pushing students to study STEM subjects (Science, Technology, Engineering and Math) over the past decade or so, often motivated by economic analyses that show STEM graduates getting more jobs at higher pay than graduates from other majors — especially the humanities (history, philosophy, cultural studies, languages, etc.)

IMO, the statistics are twice flawed. First, as every economist (should) know, the purpose of life is not about maximizing earnings, but happiness (“utils”), which can come from the things money buys but also what you do, who you work and socialize with, where you live, and so on. Money is very important for poor people, but college graduates in rich countries earn more than non-college graduates and are WAY better off than most people in poorer countries. Second, initial earnings do not always correlate with lifetime earnings. Liberal arts students (I teach at a lib arts college) do quite well in later years, for example.

But administrators are not that imaginative, and they — like most bureaucrats — can over-react in counterproductive (high-modernist) ways, as James C. Scott pointed out — so they started to favor STEM majors over other majors — and especially the “poor” humanities. Professors in the humanities decided that their best option was not to double down on what they were good at (building great intellects) but to engage in campus politics, i.e., to claim that they represented underprivileged groups, that they would make amends for colonialism, that they could fix racism, that they — and only they — could make the administrators look good to a public that worried about inequality, injustice, and… a host of other social ills — a series of steps described in that insightful read mentioned above.

Don’t get me wrong. I am not a fan of racism, inequality, and all that, but it’s not like these problems are easy to fix or new (“the poor you will always have among you“). I’ve traveled in 100+ countries, and even quick solutions take more than a century to work.

So now we have administrators backing false prophets (not all professors of humanities, but enough of them) presenting over-simplified theories that cannot survive contact with reality (go Marx!) to idealistic students who live in post-modern bubbles where parents/loans pay the rent. I really love my students, and the passion they bring to many topics, but I also remind them (time and again) that I, as a professor, am not qualified to tell them about the real world that they will enter into, after 16+ years of schooling — a real world where nobody cares about your positionality, where nobody cares about your grades, a world where “diversity” means the working poor, the migrants, the less-educated — and especially the people whose politics they don’t just detest, but don’t understand. In that real world, “transdisciplinarity” means you get safe, tasty food made from ingredients coming from multiple producers; it means that your house doesn’t fall down; it means that there is a medical system that keeps you alive for twice as long as your (great-) grandparents. In the real world, nobody gives a shit about your major. In the real world you are a person, not a major, and what matters is how well you work with others.

So don’t pretend that your speech is more important than theirs.

The bottom line is that the failure to support real freedom of speech on campus — and real discussions about real human issues — boils down to another version of academics putting their theories ahead of reality, which will ruin us all.

But don’t take my word for it. Listen to a mathematician who grew up in the USSR before migrating to teach in the US:

“I grew up in the Soviet Union, where people had to affirm their fealty to ideals, and the leaders embodying those ideals, on a daily basis,” he told me. “As years went by, I observed the remarkable ease with which passionate communists turned first into passionate pro-Western liberals and then into passionate nationalists. This lived experience and also common sense convince me that only true conformists excel in this game.

[snip]

“The main responsibility of every Soviet citizen was to facilitate the arrival of communism, where people would contribute to the society according to their abilities and receive from the society according to their needs—has there ever been a nobler-sounding goal? And yet historians cannot agree on an estimate of how many millions of people were starved to death, tortured to death, or worked to death, all in the name of that goal.”

Speak freely, everyone on everything, if you want to live together and overcome the dangers that threaten all of us.


*I am not quoting Franklin’s 1755 statement (“Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety”), which was about paying taxes to fund defense (!) but this statement from 33 years earlier:

In those wretched countries where a man cannot call his tongue his own, he can scarce call anything his own. Whoever would overthrow the liberty of a nation must begin by subduing the freeness of speech … Without freedom of thought there can be no such thing as wisdom, and no such thing as public liberty without freedom of speech, which is the right of every man …

Addenda (14 Jan): Substack could not decide between free speech and “community,” so now  people are unhappy.  Read this brutal takedown of dishonest universities.

Addendum (25 Jan): Good discussion on “the freedom to speak your mind” with the president of Wesleyan.

 

So maybe not kill ALL the lawyers?

I’m not typically a fan of lawyers, mostly due to experiences of (a) immoral behavior in pursuit of winning at all costs and/or (b) writing laws that increase demand for lawyers without increasing quality of life.

Now, let’s look to a few good aspects of lawyering that I have recently had the (mis)fortune — due to legal disputes — to be reminded about:

Lawyers are good for…

  • Giving you advice and an alternative perspective.
  • Supporting you in a dispute (=someone on your team)
  • Understanding legal details, processes and norms.
  • Working for you when you’re busy elsewhere.

So, let’s not kill all the lawyers — not just yet 😉


ps: In countries with populations from multiple cultures, it’s useful to have rules — and the lawyers to enforce them — to reduce friction (thus, spending a bit on lawyers to save a lot elsewhere) and help everyone get along. In more homogenous cultures, customs may be more important than rules in terms of delivering less friction at lower cost. But those cultures can run into serious issues if, for example, they start to diversify, cultural norms are no longer shared, and there is no tradition of using rules (and lawyers!) to work out disputes. Tricky.

The easier route to social change

There are many examples of where one group dominates another and limits social change.

Examples: Men dominating women, whites dominating non-whites, citizens dominating migrants, etc.

Some dominants like their power but others in the dominant group may not. Let’s assume that those who are dominated do not like it (sorry masochists!)

While thinking about this combination of power structure and interaction, I came up with the following 2×2 (I love 2x2s!) example for “men’s” and “women’s” bikes:*

This figure shows three things:

  1. Men who ride on cross-bar bikes and women who ride on step-through bikes are “supporting the patriarchy” in a passive or active way. That’s how things do not change.**
  2. Women who ride cross-bar bikes are fighting the patriarchy, which may work but probably will not, since they are the victims of patriarchy.
  3. Men who ride step-thru bikes are ignoring the patriarchy, which weakens it. If enough men stop caring, then the patriarchy (with respect to bikes) will collapse.

These observations are not based on justice as much as real-politiek, in the sense that shifts of power are far easier when they come from above (evolution) than from below (revolution). I do not state this fact as something I agree with; I state it to clarify (a) how people on the two-off diagonals (fight and ignore) are allies in changing the status quo and (b) how much easier it is when defectors from the oppressor class help those in the oppressed class.

Can you make such a 2×2 for your causes? Vegan diets? Gun control? Reading books? Go ahead!

My one-handed conclusion is that bottom-up social change is much harder without some top-down help.

*Here are some critiques of those “differences,” which I agree with. I’m just using the streotype as an example.

** Here, via RB, is the A-Z of the all-inclusive bike seat (see image):

A: A bag covers the patriarchy.
B: And makes the penis shape Be gone.
C: Confirm it is an all-inclusive bag… with all the colors and symbols.
D: I Did sit on it myself, as a representative of the patriarchy.
E: My End discovered it is actually uncomfortable.
F: Figure out that a plastic bag is not a sustainable solution.
G: Got into a mental conflict with myself.
H: Had an existential crisis.
I: I rediscovered me.
J: Just to be obsessed with letters…
K: Picked the letter K to identify as K.
L: Let go of being K because being gay is easier.
M/+M just makes more sense to me anyway.
N: Not to be confused with the fact that anyone can identify with any letter they want though.
O: At least in my Opinion.
P: Potentially resulting in a lot of conflict in a lot of non-Dutch cultures.
Q: Question what does queer actually mean to you?
R: If you can identify yourself as different means you are no longer Racist?
S: Solution to the mental conflict? Aka being queer?
T: Transforming my existential crisis into something that benefits me?
U: Will I do I or Will U do U?
V: Vegan or Vegetarian? That is question….
W: Will the World actually care about my mental conflict?
X: Xsistential crisis.. Sorry too lazy to discuss Xenophobia.
Y: Yeah I know same topic, different nuances.
Z: About Gen Z. Do they have an Attention Addiction because of the AA humor that they will probably misunderstand or are clueless about anyways. That is just my humor that I would like to portray…

Man should rule over all the Earth’s creatures?

Genesis 1:26-28 says:

Then God said, “Let Us make man in Our image, according to Our likeness; let them have dominion over the fish of the sea, over the birds of the air, and over the cattle, over [g]all the earth and over every creeping thing that creeps on the earth.” So God created man in His own image; in the image of God He created him; male and female He created them. Then God blessed them, and God said to them, “Be fruitful and multiply; fill the earth and subdue it; have dominion over the fish of the sea, over the birds of the air, and over every living thing that [h]moves on the earth.”

Many people have interpreted these passages as (a) an unlimited license to exploit the Earth and all its flora and fauna as well as (b) a guarantee that nothing can go wrong, since God said it was ok.

Ignoring the Bible’s origins as the writings of (self-serving) human males, rather than the literal word of God, let’s look a bit deeper, via God’s guidance on vows:

When you vow a vow to God, do not delay paying it, for he has no pleasure in fools. Pay what you vow. It is better that you should not vow than that you should vow and not pay. Let not your mouth lead you into sin, and do not say before the messenger that it was a mistake. Why should God be angry at your voice and destroy the work of your hands? — Ecclesiastes 5:4-6

So it seems important to keep your promises, especially to an all-mighty, all-seeing God.

But Adam and Eve did not do that in the Garden of Eden:

Genesis 3:22-23:

Then the Lord God said, “Behold, the man has become like one of Us, to know good and evil. And now, lest he put out his hand and take also of the tree of life, and eat, and live forever”— therefore the Lord God sent him out of the garden of Eden to till the ground from which he was taken.

So, let’s recap:

  1. God gave everything to Adam and Eve, with the condition that they not eat of the Tree of Knowledge.
  2. Adam and Eve ate of the Tree (I’m not going for the misogyny of blaming Eve).
  3. God punishes them by exiling them from Eden and condemning them to go get their own food (“to till the ground”), which — IMO — also voids God’s gift of dominion “over every living thing…”

My one-handed conclusion is that believers (and the rest of us) have NOT (since around week 2 of the universe’s existence ;)) had (a) an unlimited license to exploit the Earth and all its flora and fauna or (b) a guarantee that nothing can go wrong. Or, to put it differently: We’ve over-reached in both our rights and our security… and look where that’s got us:

I heard that “humans and food for humans” takes up 97% of the Earth’s biomass, meaning that only 3% of the biomass was still “wild.” Based on this post, I looked at the data, which shows that “humans and food for humans” compose 95% of the “land creatures” with the remaining 5% going to wild animals and birds. If you include fish, mollusks, worms, spiders, etc., then the share of “humans and food for humans” drops to 5%. Such a switch is not good news, IMO, since (a) our 95% share of “land creatures” was much lower (say 50%) 100 years ago, when populations and meat eating and land clearance were all lower, and (b) we are also impacting worms, fish and other species that will go extinct in the Anthropocene.

Who in God’s name will save the Earth from its “guardians”?

Addendum (8 Oct): We should all go vegan, to reduce agriculture’s footprint by 70 percent — thus feeing land for nature, ecosystems and biodiversity.

Income-based pricing is a bad idea

I learned, via GS, that some Berkeley researchers have proposed [pdf] that  customers should pay for electricity based on their income.

Thus, I would pay half of what you would pay if I made half the income you did.

This is a terrible idea, IMO, but I can see how we got here, which I explain in two phases: charges related to costs (points 1-3) and charging rich people more (points 4-7):

  1. Utilities have fixed and variable costs and they recover those costs by charging customers fixed and variable prices.
  2. Utilities that are trying to green themselves and/or accomplish social goals need to make additional capital investments (transitional costs) that need to be financed by today’s customers on behalf of tomorrow’s citizens — some of which are customers but most of whom are stakeholders.
  3. In a “neutral” scenario, costs and prices are matched, i.e., fixed charges (via prices to customers) cover fixed costs. In a “conservation” scenario, variable charges are raised above variable costs and fixed charges lowered below fixed costs, to encourage people to use less electricity or water or whatever. One side effect of this scenario is that those who use more pay more. Another is financial instability (a change in use results in different changes in costs and revenues). I discuss these issues in my paper on pricing water.
  4. Payment for utility services, like payment for ice cream or gasoline or a mobile phone, are meant to reflect the seller’s costs and the buyer’s willingness to pay (demand for that good) — not their ability to pay (income available for all goods).
  5. But lots of utilities are regulated to achieve social goals that have nothing to do with normal pricing. That’s why there are sometimes “social tariffs” (=cheaper prices) for poorer people, which requires subsidies of some sort.
  6. Social tariffs doesn’t work very well in practice (see pp 131-133 of my paper), since it requires a lot of extra information, doesn’t match reality (people lie; bureaucrats mess up), and distorts behavior and choices. It’s better to help poor people by giving them money and leave prices alone. If there’s a need to bring more money into the system, then change the mix of tariffs, taxes and transfers that pay for costs, i.e., “neutral prices” to cover operating utility costs (tariffs) and transfers from the state government to cover transitional costs. Those transfers can come out of state income tax revenues that already exist, are easier to change, put the burden on people with more income, and do not distort prices/decisions.
  7. Utilities should not charge income taxes, and neither should any business or branch of government providing goods and services. Keep willingness to pay separate from ability to pay. (There’s a legitimate problem risk of a slippery slope here, i.e., setting prices for goods and services based on income, which is a total information nightmare even before considering that richer people will leave to a place with “fair” pricing.)

My one-handed conclusion is that the Berkeley researchers are excluding state income taxes because they need a local solution, but this one (a) has terrible optics, (b) won’t work very well, and (c) dodges the big question of how much extra the rich will need to pay to subsidize the poor in a sustainability transition.

NB: Criterion (c) also applies to the global fossil fuel transition, which is not going well. Only a fraction of the $trillions per year that are needed is getting paid.

The high cost of cheap permit parking in Amsterdam

This post updates my Jun 2022 post announcing the paper because I have extensively revised the paper (shortening, correcting, elaborating) before sending it out to a journal for review.

I don’t know when we will get news from the review process (somewhere between 1 day and 6 months), so here are the highlights:

  1. We started the paper to see how bureaucratic prices for parking lined up (or not) with market prices for housing. Both prices should go up in “popular” neighborhoods. If they are misaligned, then opportunity costs for misallocation rise. To check alignment, we used GIS and ratios of parking prices to housing prices, which made it easy to compare areas across the city.
  2. Our first pivot came when we realized that people park by the hour (tariff, for visitors) or year (permit, for residents), so we compared both.
  3. Permit parking takes 80% of spaces to earn 20% of parking revenue. That’s because permits are inefficiently cheap, so bureaucrats increase tariffs (€7.50 per hour and rising) to try to squeeze out visitors. Here’s the imbalance:
  4. Although I had heard of Amsterdam’s autoluw (“nearly car free”) policy, I did not know that it dates back to a 1992 referendum to remove cars from the city center. But, there are now more cars (and parking places) in the center than in 1992, so progress is slow.
  5. According to our analysis of ratios, permit parking is too cheap everywhere, and tariff parking is too cheap in Noord, which will harm quality of life as that district develops. This map shows the ratio of tariff to living prices (Noord in red):
  6. The city is not raising permit prices to reduce demand. Instead it is trying to build more supply — underground and underwater parking garages — for permit holders. Spaces in these garages cost €80,000-230,000 to build in our three examples, but the city isn’t even recovering its operating costs in permit revenue. So its spending €millions of citizens’ money on capital projects that will never earn their cost back.
  7. We recommend increasing the price of permits from current (€500/year) levels to around €3500/year, which is what (other academics have estimated that) people are willing to pay.
  8. Such an increase, over time, would reduce the number of cars by around 40 percent, freeing 50,000 spaces for other uses (and removing the need for costly garages). The extra revenue (around €300 per citizen per year) should be used to improve neighborhoods.

You can download the paper from here.

We are happy to hear your corrections and suggestions for improvement!