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Wednesday, July 30, 2008

Economics vs. personal finance

Thanks to the Problogger Social Media Love-in, I have a number of new friends on Twitter and other socialnetworking sites (hello new friends!). As I've been exploring the blogs of all these new friends, I'm surprised by how many money-oriented and personal-finance-related blogs there are out there (yes, I realize that this is a sample selection issue since I'm sure that these folks are more likely than others to have been interested in connecting with an economist, but still...). Seeing all these blogs strikes me as particularly great given a recent Freakonomics post in which Dubner asks whether we are a nation of financial illiterates and the answer is a pretty scary yes.

But I also have to say that the Freakonomics post raised an old issue for me about whether we should be teaching 'personal finance' in schools. In many places, high school economics courses already ARE courses more in personal finance than real economics. That is probably not so much a conscious decision by anyone about appropriate curriculum but is simply a result of the fact that many high school economics teachers are not actually trained to teach real economics. Regular readers of this blog can probably guess what I think of that. Annamaria Lusardi, an economist who has done a lot of work showing how financially illiterate Americans are, says it quite well:
I do not think that literature and mathematics are less useful in the lives of people than financial literacy. In my view, financial literacy should not replace these courses (in fact, some financial literacy can be integrated into mathematics), but should be added into the curriculum with the same high standing... we need to stay away from things like how to balance a checkbook and teach about the workings of the economy.
I am not saying that it is not incredibly important for students to understand how to manage their money. But what many people don't really grasp is that in the long run, a firm grounding in economic principles would do much more to improve financial literacy than teaching students the difference between a CD and a money market account.

Economics is to personal finance as...
Since my intro classes are always full of wanna-be business majors, I always start the semester with the analogy that econ is to business as English is to journalism - in both cases, classes in the applied fields involve learning specific pieces of information that one certainly needs in order to be successful, but classes in the more general fields provide the foundational skills so you know what to do with all those specific pieces of information. The problem is that because this distinction is not well understood, teaching 'financial literacy' often means crowding out teaching basic economic principles, particularly if policymakers get involved. This is not an idle concern; in California, there is legislation pending that would require that in the next round of revisions to subject area frameworks, the economics frameworks be revised to include "instruction related to the understanding of personal finances, including, but not limited to, budgeting, savings, credit, and identity theft."

Again, I am not saying that it wouldn't be wonderful for students to get this instruction. I just worry about what it will replace. Moreover, I wonder whether we would need to require this instruction specifically if students were already getting a solid grounding in basic economic principles.

Related posts:
Do high school econ courses prepare students for college econ courses?
Where is the demand for better K-12 teachers?
Why doesn't anyone know what economics is?

Saturday, July 26, 2008

Class discussions about the war

There's a particularly timely post on Blogher about the cost of the Iraq war - and I say 'timely' because I was in the middle of thinking about how to talk about the war in my class when the post appeared in my reader. The post links to a calculator from Progressive Future that tells you how much of your 2007 taxes went to pay for the war and what that money could have bought in terms of days of health coverage, Head Start, renewable power or education for a veteran. The calculator highlights the dollar value of these alternatives but the post on Blogher also points out that it's hard to put a dollar figure on some of the other costs. That was going to be my point in talking about the war in class - I'm planning to use the war discussion to tie together cost-benefit analysis with the positive-normative distinction (i.e., how much you value certain costs, like the loss of American lives, versus the benefits, like increased safety, is really a normative assessment). I stress to my students that economists try to stay in the world of positive analysis - identifying what the costs and benefits are, particularly making sure everyone recognizes the trade-offs involved - but policy decisions often come down to normative values.

However, whenever I venture into controversial topics, I get very nervous. Obviously, discussing sensitive topics raises opportunities for students to get offended, or make offensive comments. I try to set discussion ground rules early in the semester, and reiterate those again before discussing certain topics, and I try to keep the discussion focused in a fairly narrow way (e.g., identify the costs, identify the benefits, identify which can be measured objectively and which are more open to value judgments, etc.). I also try to be very clear that I am not saying that X is right or wrong. Discussions can easily disintegrate if students do not understand that I am not trying to convince them that one position or the other is 'right' but that I am trying to clarify what the factors are that might lead one to choose either position. One thing I always find a little ironic is that I have often had students on BOTH sides get upset because they believe I am supporting the view opposing their own (that is, because I am not clearly endorsing their view, they assume I am implicitly endorsing the other). On the one hand, the fact that students on both sides feel this way tells me I am doing something right; on the other hand, the fact that any student feels this way tells me they have missed the point so I must be doing something wrong.

I'm curious how others handle discussing topics that could be considered controversial. Do you even attempt it?

Wednesday, July 23, 2008

Dumping content

Even before reading the comments from the first time I taught the 500-seater micro principles class, I was working on re-designing the class to cover less material. But of course, that requires thinking hard about what to drop. I have particularly struggled with the balance between material that I think students may need for upper-division classes (like cost curves) and material that I think students may not see anywhere else if they don't actually become econ majors (like externalities and public goods). I tend to prefer keeping the latter and dumping the former, since I strongly believe in the liberal arts, general education aspect of economics. I'm not as concerned that some business majors might not have a stellar grasp on average versus marginal costs, as I am that they won't understand there are good reasons for government intervention in certain markets.

So I was really intrigued by a conversation I had yesterday with a friend who teaches in an econ department that is in a business school (read that: they exist to serve business students and have very few true econ students). In his department, they have pared down their principles course to ONLY cover those topics that they believe their students will need in their business courses. While I can understand how that would mean they dump externalities, I was suprised that one of his colleagues actually skips economic surplus (i.e., consumer and producer surplus and deadweight loss). But as I've thought about it, it kind of made sense to me. Measuring deadweight loss or identifying the change in surplus makes nice straightforward exam questions but what are students really learning? I primarily use deadweight loss to talk about the distortions created by taxes or monopolies, but I could do that just by talking about the drop in quantity, which they intuitively get without the graphing contortions.

I have a feeling that some economists reading this might be recoiling. But the more I think about everything I usually try to get through in introductory courses, the more I am convinced that for the majority of my students, they just aren't getting much out of it and I'd rather they really get the concepts that are most important, than to have a superficial understanding of a lot of stuff they may never use again anyway. Maybe a better teacher could do it all, or maybe if I had smaller classes or more time (my courses are 3 units so my students don't have breakout recitation sections like the ones I presided over as a TA in grad school)... Or maybe that's just a cop out. I'd certainly be curious what others consider the most, and least, important topics for introductory micro students...

Related posts:
Why do I read my evaluations?
How much should I be influenced by the economics section at Borders?

Tuesday, July 22, 2008

More on fixed vs. growth mindset

This article from the New York Times Business section talks about how people with a 'growth' mindset (i.e., who believe talent is not fixed but can grow over time) are more innovative and successful in the corporate world. Given that the majority of students in my Principles class are wanna-be business majors, maybe I should have them read this...

Related posts:
Intrinsic vs. extrinsic incentives
Cultivating optimism

Monday, July 21, 2008

Why do I read my evaluations?

[warning: this post doesn't really have a point, I just need to vent!]

Sigh. Because I've been on leave since January, I never read my evaluations from Fall 2007, the first time that I taught the 500-seat Principles Micro course. But now I'm back in San Diego and was foolish enough to look at them. They aren't all bad - a number of my students are very sweet and made comments such as, "Professor Imazeki really did the best she could with a class this size," and "I don't think she needs to do anything to improve except not have so many slacker whiners in her class" (I may have to have that one framed to re-read every semester when I'm going through my evaluations!). Of course, there are the typical contradictions that I try to ignore (e.g., a bunch of students HATE Aplia and just as many LOVE it). There are also the perennial (for me) "she goes way too fast" and "her exams are crazy hard". I can accept those because I think they are probably accurate, but I also know the larger-than-usual number of such comments is because it was my first time teaching the super-sized class and I'm pretty sure I can improve the next time around.

But after all these years, I still find it hard not to be completely annoyed by the students who blame me for things that are just flat out wrong but they don't know they are wrong because they didn't pay attention, like saying that I never told them when assignments were due (apparently they missed the weekly posting on the course website), or it was unfair that they couldn't make up points when they missed class for good reason (they apparently didn't understand that when I said I'd drop their 8 lowest scores that meant they didn't lose any points for those missed classes). Maybe even more frustrating are the students who say that they want the class to be more interactive but also say they were confused by all the technology. On the one hand, I'll take that as a suggestion to do a better job explaining how Aplia works but on the other hand, it makes me just want to scream because, really, what am I supposed to do with that?!?!

Sigh. OK, back to the grind, trying to take all this 'constructive criticism' and use it to make the class better the next time...

Sunday, July 20, 2008

Helping students learn time management

Lifehack has a review of StudyRails, a web-based service that helps students manage their time and their studying. It costs $10 a month but for students who really need help with their time management skills (I'm particularly thinking of new college students), this looks like it could be a really useful service.

I was particularly interested when I saw this post because I make it a point to tell students in my introductory courses that my objectives for the course include both subject knowledge and life skills - the first is econ-specific but the second is not. By 'life skills', I mean critical thinking (which I consider most important) but also the more mundane but clearly-important-for-success-in-life skills like teamwork, communication and time management. I began naming these skills as specific objectives for the course because I got tired of dealing with students who would turn in work that was incredibly poorly written but who would complain when I marked them down and argue, "But I answered the question correctly!"

On my course website, I have links to campus resources for students, like the counseling center, but it hadn't really occurred to me to link to other resources, like StudyRails. I'll need to think about whether if it's appropriate to link to private, for-profit services, since it will seem like I'm endorsing them. I also just don't know of other services that might be worth linking to but if anyone has suggestions, feel free to leave them in the comments.

Thursday, July 17, 2008

Intrinsic vs. extrinsic incentives

Somewhat related to my struggle to trust my students is my interest in intrinsic versus extrinsic incentives. Economistmom wrote a post about handling her daughter's allowance, which led me to comment that when I was growing up, my mom always said that our allowances were not 'payment' for doing household chores, we were supposed to do chores simply because it was our responsibility as members of the family. Tyler Cowen makes a similar point in Discover Your Inner Economist, arguing that if you pay your kids to do stuff that it can actually be a weaker incentive than relying on their sense of familial duty. But on the other hand, the ed policy world was buzzing a few weeks ago when New York City received a prestigious award for its "Million" Campaign, in which students receive cell phones and prizes as rewards for academic achievement.

On the face of it, I wasn't thrilled when I first heard about the Million Campaign, precisely because I'm skeptical that a program that relies on extrinsic rewards can have lasting effects on student achievement. But what I find interesting (and granted, I know very little about the program) is that I have heard anecdotal stories about kids who, because of the program, begin to develop intrinsic motivation to succeed. That is, the program is targeted specifically at kids for whom academic success is not considered "cool" and so they have simply never tried very hard. When they actually start studying and learning, even though that effort begins as a way to earn extrinsic rewards, they also begin to discover that they like learning.

In my principles class, I already include a little bit of discussion with students about intrinsic versus extrinsic incentives. Given that economics as a field tends to focus on extrinsic incentives, I think it's important to remind them that sometimes the strongest incentives are those we can't measure with dollars. Freakonomics actually provides a very useful example: I have students read the chapter about sumo wrestlers and teachers both cheating (in response to monetary incentives). Invariably, students find the idea of teachers cheating to be more morally repugnant and when I ask them why, they usually come up with answers like, "teachers are supposed to care about what their students are learning" and this leads nicely into the discussion of different types of monetary and non-monetary incentives.

I'm thinking that this year, I will try to expand that discussion to my students' own motivations. Do they do certain things (like come to class or complete assignments) because of the extrinsic incentives (i.e., grades) or are they intrinsically motivated to actually learn? I'm wondering if simply having this discussion will lead students to be more intrinsically motivated...

Related posts:
Learning to trust students
It's hard to get incentives right

Tuesday, July 15, 2008

Learning to trust students

I have many objections to super-large lecture sections (which, unfortunately, are my University’s response to higher student enrollments) but probably my biggest gripe is that they provide a huge disincentive to have students write. Even with masters-level teaching assistants, and even if papers are short, I don’t think any but the most masochistic professors would want to deal with grading for that many students. But one of the reasons that I have become so interested in Web 2.0 tools like blogs and wikis is that they have the potential to get students writing, but without the need for me to monitor every word. So for my 500-seat Principles of Micro class this fall, I plan to give students the option to write blogs or participate in discussion boards. Given the size of the class, my thought is that I will give students a choice of four semester projects: one option will be volunteering for Junior Achievement, one involves participating in a class blog about economics around the web/in the news, one will be a discussion board on economics in popular culture (music, movies, TV), and one will be more traditional problem set assignments (through Aplia). I am still trying to figure out how the blog and discussion board projects will work (like how often they will be asked to post, how I will grade their efforts, etc.), but I'm pretty excited and hopeful that this will be a great way to get students to start seeing economics all around them.

However, a few weeks ago, I was telling a friend about my plan. She asked how in the world I was going to keep up with all my students' posts, pointing out that even if the majority of students choose the JA or problem set option, I'm still likely to have well over a hundred students either posting to the group blog or participating in the discussion board. My response was that I have no intention of reading every single post and comment; the whole point is to have students read what their classmates write and build the discussion on their own.

My friend was extremely skeptical - I think she believes that students won't take it seriously, or will write stuff that is "wrong", and it will therefore be a waste of time. I have to admit that I worry she is right. But I have also thought carefully about these assignments and I believe that the interactive nature of a blog or discussion board is a good fit for what I'm trying to do. The point is for students to see how economics is a part of their lives, how the economic way of thinking can be applied in a multitude of ways and to a variety of circumstances. Each blog or discussion board entry will be one student giving an example (with some explanation of how it ties into the class); if the example is not a good one, I have no doubt that other students will let the author know, so there should be no need for me to weigh in as 'the expert'.

Still, I am definitely anxious. This is going to give students a more open forum than I have ever done before and I'm trying to trust that they will not abuse it. I'd certainly love to hear from anyone who can ease my mind about this!

Monday, July 14, 2008

Letters from America

Tim Harford has done the world a service by pointing out that Angus Deaton's Letters from America (published every six months in Britain's Royal Economic Society Newsletter) are online. Deaton's Letters provide many insightful observations about the economics profession, particularly when it intersects with policy and the media. Definitely worth perusing...

Sunday, July 13, 2008

What we can learn from a high school student

Tyler Cowen points to a story about a student in Pittsburgh, Seth Weidman, who independently taught AP economics to his classmates. Aside from the obvious awesomeness of this kid's initiative, this story was striking to me for the important lessons it contains for all teachers of economics:

- One of the keys to teaching economics well is making it relevant: "Seth developed a philosophy that if students weren't paying attention, it was because he wasn't making the class interesting enough. So he concocted ways to illustrate economic concepts from the real world ofhigh school. Eva remembered the time he explained the concept of a positive externality using an example of complimenting a girl in the hallway."

- The best way to learn something is to teach it: "There's no doubt that it was a lot of work, said Seth, but it wasn't all altruistic: not only was it fun to teach the class, but he also gained a deeper understanding of economics. "If you can't explain something simply, you can't really understand it," he said. "Teaching this class made me really understand a lot of the basic concepts that I'd previously read about.""

- Seth's interest in economics began when he discovered what economics really is: "Whatever Seth thought he knew about economics was fundamentally changed after he read [Hayek's Road to Serfdom], known as a landmark libertarian text. "It made me see that economics isn't just about a bunch of guys sitting on CNBC," he said. "It's more about incentives. It gives you a cool
perspective to understand the world.""

And finally:
- Seth's 'students' did much better than most who take the AP exam: "The students took 12 total tests, and of the eight scores that have come in this month, six are 5's -- the highest possible on a scale of 1 to 5 -- and two are 4's... Nationally, fewer than 15 percent of students who took the tests in 2007 scored a 5 and just more than 25 percent scored a 4."

Related posts:
Do high school econ courses prepare students for college econ courses?
Why doesn't anyone know what economics is?

Friday, July 11, 2008

Resisting change

As I was looking for more information about Clay Shirky, I found his Here Comes Everybody blog. A post from April contains a 'lightly edited transcription' of a speech in which Shirky mentions the resistance of many in the media world to the new Web 2.0 world:
This is something that people in the media world don't understand. Media in the 20th century was run as a single race--consumption. How much can we produce? How much can you consume? Can we produce more and you'll consume more? And the answer to that question has generally been yes. But media is actually a triathlon, it's three different events. People like to consume, but they also like to produce, and they like to share.
When I read that, I immediately thought about how similar that sounds to much of the conversations in the teaching and learning community about the move toward more student-centered learning. Like traditional media folks, many teachers don't really understand this new world because they have always seen teaching as a one-way street: we 'produce' and students 'consume'. But the new paradigm is to let students be part of the production, to have them create their own knowledge. Of course, any economist who has tried to incorporate any amount of 'active learning' into their classes knows that such activities are the things that students remember most (though whether they remember the concepts they were supposed to learn through the activity is a slightly different question!), so it doesn't really seem like that big a stretch to accept that the more involved students are, the more they are likely to learn. But giving up some control, even if you are still providing guidance for the experience, is more than a little scary. And even if you're willing to give it a try, figuring out how to guide a student's own search for knowledge instead of providing the knowledge directly is really hard. I'm finding ways to ease into it with my Economics for Teachers course but it seems especially hard to figure out what to do with my Principles of Micro course. Next week I'll be writing about some of the things I'm planning to do and I'd certainly love to hear your thoughts!

Wednesday, July 9, 2008

Cultivating optimism

My sister, who works in human resources, was recently talking about some of the questions that she asks prospective employees. One of her favorite interview questions is, "Tell us about a mistake you've made and how you handled that." As she talked about the answers she had gotten from a few recent interviewees, I found myself wondering how I would answer that particular question. It seems obvious that the 'right' answer is NOT, "Hmmm, I can't think of any", and yet, I honestly couldn't think of any example I might relate in a job interview. I'm not saying I'm perfect - I decided that it's more that I have a way of 're-writing history' in my head. And then I saw an article at GreaterGood about raising optimistic kids and it explained my way of seeing the world much better than I had ever seen it articulated before (I apologize for a somewhat long quote but I think it's worth it):
According to Seligman and other researchers, how optimistic or pessimistic we are amounts to how we explain life’s events, be they good or bad. There are three basic dimensions to an explanation: permanence, pervasiveness, and personalization. The OPTIMISTIC way of understanding why something GOOD happened would explain:

The cause of what just happened as Permanent (so it will reoccur);
And Pervasive (it will affect many other circumstances, too);
And Personal (I made it happen).

On the other hand, the PESSIMISTIC way of explaining why something GOOD just happened would illustrate that:

The cause of what just happened is Temporary (something short-lived caused it – probably won’t happen again);
And Specific (affecting only this situation);
And Impersonal (I didn’t have anything to do with what happened, other people or the circumstances did).

The reverse is also true when something bad happens. A kid trips on the sidewalk and skins her knee, dirtying her new dress. The pessimist thinks: “I’m so clumsy – I’m always tripping everywhere, and now I look stupid.” The cause of her fall is (1) permanent—she sees it as a personality trait, and therefore it is both (2) pervasive and (3) personal. On the other hand, the optimist thinks: “Dang! Someone oughtta fix that crack in the sidewalk!” She’s thinking that a flaw in the sidewalk, not her own inherent clumsiness, caused her to trip. That crack is (1) temporary; (2) specific to that moment; and (3) impersonal—she had nothing to do with

The article also talks about 'growth mindset', which emphasizes effort and hard work as keys to success, versus 'fixed mindset', which emphasizes innate traits (like 'intelligence' or 'talent'), and the role of these attitudes in helping parents encourage optimism in their kids. As a teacher, I could immediately see the importance of an optimistic, growth-oriented mindset for students to succeed in the classroom; in fact, although I had never really thought about it before, I now realize that somehow, I acquired the optimistic mindset early in life and that is one reason I always did well in school. Now I just have to figure out how to encourage that in my students...

Monday, July 7, 2008

Here Comes the Economists

I just starting reading Clay Shirky's Here Comes Everybody - I happened to pick it up when browsing the New Books shelf at the library and had no idea it was the current 'it' book among techies. Of course, since then, I've seen a dozen references to it on as many blogs so now I'm feeling very cliché. But in this particular case, I think I'm OK with that, since I want to comment on a somewhat different aspect of the book than most of the ed and/or tech bloggers I've been reading.

I'm only about forty pages into it but I was so struck by Shirky's use of economic concepts that I had to go look up whether he is an economist (he isn't but he clearly learned it somewhere). One of the book's basic premises is that the internet has reduced the transaction costs of organizing large groups of people - on page 30 he evens quotes Coase's original 1937 article on transaction costs. In one early passage where he talks about the implications for businesses, he refers to music distribution, pointing out that record companies might still have an absolute advantage at distributing music but the power of the internet has made file-sharing so easy that they have lost their comparative advantage (he uses 'relative advantage' but it's the same thing). I don't read many business management-type books so maybe a lot of them are like this but I'm looking forward to finishing the book and hopefully find more examples I can use with my intro micro class, which tends to be full of business-major wannabes.

Tuesday, July 1, 2008

Teaching teaching

I've been plugging away with prepping my Economics for Teachers course, trying to figure out what is most important to cover, the best sequence in which to present certain ideas, and generally getting completely side-tracked as I find great articles and websites addressing different aspects of teaching economics. Since this is an entirely new course, I don't have many of the usual tools for guiding my decisions; that is, when I have prepped other courses for the first time, I have always had the syllabi of others who had taught the course before, as well as textbooks, instructor manuals and other aids from publishers. But in this case, the only such help I have is William Becker's syllabus for a Teaching Economics to Undergraduates course aimed at econ grad students. That's certainly been helpful but only up to a point, since I'll be teaching undergrads who will someday be teaching high school students and who are, for the most part, not even econ majors. So basically, I'm making a lot of this up as I go along.

But I had a wonderful revelation the other day that I think is going to prove invaluable. This is a course about teaching, and all of these decisions I need to make about what to cover, how to assess, when to schedule different things, etc., these decisions are, to a certain degree, part of the teaching process. So why don't I let my students make some of these decisions as part of their learning process? So, for example, one of their assignments will be a group project but instead of me trying to decide what would be the best way to structure the project and how to grade it, I'm going to let my students decide, after they read a couple articles on organizing groupwork and we have a class discussion of the relevant issues for teachers (I have to say that I'm particularly excited about this idea because I've always had a hard time with grading group work since, like most over-achieving academics, I was always one of those students who hated group projects because I was the one who ended up doing most of the work and resenting free-riding group members. Thus, I now have a really hard time figuring out how to assign grades in a way that seems fair to everyone) (interestingly, while I was working on writing this post, The Teaching Professor posted an entry about Why Students Hate Groups).

I'm not sure how far I can carry this and a part of me is not entirely comfortable with starting the semester with what amounts to an incomplete syllabus. But I also can see that, for me, this is a way to ease into a more evolved, student-centered style of teaching. More on that in future posts...