Economies of Competence

I was forwarded the below email. I am posting it here with comment below for anyone who was also sent the email and who finds it as abhorrent as I do. I make a simple argument below to indicate its fallacies:

An economics teacher at a local school made a statement that he had never failed a single student before, but had recently failed an entire class. That class had insisted that Gillard/Brown socialism worked and that no one would be poor and no one would be rich, a great equalizer.
The teacher then said, “OK, we will have an experiment in this class on the Gillard/Brown plan”. All grades will be averaged and everyone will receive the same grade so no one will fail and no one will receive an A…. (substituting grades for dollars – something closer to home and more readily understood by all).
After the first test, the grades were averaged and everyone got a B. The students who studied hard were upset and the students who studied little were happy. As the second test rolled around, the students who studied little had studied even less and the ones who studied hard decided they wanted a free ride too so they studied little.
The second test average was a D! No one was happy.
When the 3rd test rolled around, the average was an F.
As the tests proceeded, the scores never increased as bickering, blame and name-calling all resulted in hard feelings and no one would study for the benefit of anyone else.
To their great surprise, ALL FAILED and the teacher told them that socialism would also ultimately fail because when the reward is great, the effort to succeed is great, but when government takes all the reward away, no one will try or want to succeed. It could not be any simpler than that. (Please pass this on)
Remember, there IS a test coming up. The next election.
These are possibly the 5 best sentences you’ll ever read and all applicable to this experiment:
1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.
2. What one person receives without working for, another person must work for without receiving.
3. The government cannot give to anybody anything that the government does not first take from somebody else.
4. You cannot multiply wealth by dividing it!
5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

The high school economics teacher who carried out this little experiment should go on some kind of sabbatical to give the teacher time to head back to university and learn some basic political economy. What is wrong with the logic of the email? It equates marks received during education with money. Such an obvious error leads me to believe an actual teacher would never actually carry out such an experiment.
Money is a quantitative measure. The difference between $74 and $75 is only a difference of $1. The difference between a mark of 74 and a mark of 75 is also a difference of one mark, but it is also the difference (at my university, at least) between a distinction grade and a high distinction. Marks are a quantitative measure of a qualitative difference.
Why is this an important distinction to make? You do not take part in education to get marks. You take part in education to get an education. When employed, you work to exchange whatever work you carry out for money; money then allows you to go do things. You do not exchange anything while being educated; the point of education is to be transformed at a basic level from someone without skills or knowledge to someone who has achieved a certain level of competence. Competence is qualitative. There are good and bad students just as there are good and bad teachers.
The worst possible conclusion to draw from the email’s example is that students take part in education so as to ‘accumulate’ marks and not for the explicit purpose of becoming competent. This is actually a common phenomena. Students will try to minimise the amount of effort and work required to learn and expect to achieve the same marks. They follow the exceptionally poor advice and embody the ideology contained in the email. They try to ‘game’ the marking criteria and assessment details so as to ‘accumulate’ marks rather than acquiring competencies. If you have children or friends who are studying at whatever level encourage them to study so as to learn.
People who embody the faulty logic of the email may find it hard to adapt or even imagine some other way of ‘working’ that is not premised on a market model (you work to accumulate some ‘number’ of something, be it marks, money or whatever). Clearly, they have not thought too hard about the various other non-market based economies that operate in most developed countries. Here are a few:
1. Children. How do you measure the ‘success’ of your offspring? In terms of how many you have? Maybe that is good in non-industrial or non-developed agrarian or nomadic societies. In developed countries we invest a huge amount of resources into our children. What sort of return do we get? We hope children will have a high quality of life. One’s quality of life can be represented in quantitative ways, but like educational assessments, the number represents a quality.
2. Education. I don’t mean for students, I mean for the teachers. People don’t become teachers because of some quantitative measure of success. They believe that they can make a difference in the lives of their students, help their students (and others) live better lives. If the local high school teacher did believe what was contained in the above email, then why are they working as a teacher? Surely they would work where they would maximise the economic return for their work?
This leads me to my overall point. Most of our activity as human beings is not carried out to get a quantitative reward. The love of parents or the care and consideration of teachers is more important to the future of Australia. That is why I find the email so offensive. It was written by someone with an axe to grind, but has clearly never thought about the purpose of education.
I won’t even bother engaging with the explicit political point of the email regarding the redistribution of ‘marks’ as if they were a form of money. The abject stupidity of the analogy makes me sad.

22 thoughts on “Economies of Competence”

  1. I think the people who talk about giving something for nothing leading to lazy people have never actually been forcibly unemployed. It gets BORING. We actually need to have something to do, something we can engage with – and you can’t really relate an adult’s working life to teenagers’ experience with school, because teenagers’ brains just plain work differently. They have poor impulse control, they don’t think about the future as well, they’re hormonal wrecks, and most importantly they get a dopamine rush from immediate payoff, while older people get it from being able to see the effects of their effort. (This is all generally speaking, of course – there are always exceptions.)

    What we *might* see is that if we didn’t have to work, people would turn more towards activities that we don’t currently consider to be work – things that would fall under volunteerism, or “pointless” academia. But quite often those things are socially important anyway, and in an economic-based system where people are frequently pressured to work for sixty or more hours a week (either to pay bills, or to keep their jobs, or whatever), social knowledge that doesn’t have an economic reward is being lost. Personally I think we’d be better off with more people working less hours each and being compensated for it more fairly, giving everyone more leisure time and a lot less stress – particularly when you consider that for every four people working a 50 hour week, one person is missing out on a full time job.

  2. Thanks for your comments Chris. Your point about people who have never been forcibly unemployed can also be flipped around to make a similar point about non-economic benefits of work.

    Most people who have worked for a big company will be familiar with the experience of seeing colleagues being laid off so as to meet certain financial outcomes. There is often no attempt to manage and retain the organisational knowledges or other forms of competence, that do eventually lead to economic benefits but for which there are no standardised measures. In the organisational studies literature this is called ‘tacit knowledge’ (after the work of Michael Polanyi, which I written about on here previously). It is very difficult to measure this ‘tacit knowledge’ or to retain it without retaining the actual staff in question, but it is often essential to the quality of a workplace.

  3. I’d like to begin by assuming the person who posted this is a educated person, i myself I’m just starting the journey. Though you make some valid points, you’ve overlooked the basic idea behind the teachers lesson. The lesson was to show the students that competition is necessary it weaves out the unwanted weeds that tend to tarnish a good lawn.

  4. Andre, one of the basic functions of education is that it is transformative on an individual level. At its most basic, students learn, thus they are not the ‘same’ person after being educated. To use your analogy, every student is a gardener of a lawn with various plants and grass types including weeds; those in education work to help students tend to their respective gardens that suits the student and so on.

  5. The experiment – if it existed in fact, rather than urban muth – is sound, and perfectly pitched to the environment of the students.

    Learning outcomes for individual students are at least partly reflective of effort.

    Other less measurable aspects that can be considered part of the educational journey, such as specific application and even ‘giftedness’, can also be applied to this student’s lesson of productivity.

    You have compared education to the tending of an individual lawn. What is different about the individual adult’s quest to improve the life of themselves and their family? The quest to improve oneself via education, and the quest to improve via greater workforce recognition are all part of the same drive for self-improvement through life.

    Those that are experienced, or perceived as ‘talented’ in a particular area of the workforce tend to do much better than beginners or those who perform poorly.

    The great difference with money-earning potential is that a huge percentage of all earnings are taken as transfer payments, whereas generally school marks are your own (although group work, in both the school and work environments, is increasly popular and creates a group incentive. Interestingly, many students say only a small proportion of students do most of the work within group assessments).

    Work (and money) are transformative in that they, like education, change the person as they are applied, eg in the area of health and lifestyle expectations.

  6. Hi ‘mum’ (not my mum!),

    I do not agree with the parenthetical insertion “(and money)” in the last line of your comment.

    I agree work and education can certainly be transformative.

    In an exchange-based capitalist society we use money to access various experiences (work, education, etc), but the money itself is not equivalent to the experience.

  7. I don’t agree with your analysis of the e-mail.

    The point of the e-mail was never to question the point of education or work. In the e-mail, two assumptions were already made, and seems to be true in the world.

    1. People work for money, which is then used to acquire happiness by improving experiences.
    2. Students study for marks, which generates self-satisfaction and thus a sense of happiness.

    Therefore based on the e-mail, both money and marks can generate happiness, and that’s the analogy. You say that the students don’t work for a qualitative experience, but from the scenario it’s clear that the students in concern acquire happiness through marks. You might not equate marks to happiness, but there certainly are people who do.

    You also pointed out that work is an exchange, but education is not. Now, given a choice, I’m sure most students wouldn’t want to study to get marks , or an education. It’s an exchange of hard work and time for education. How is that not an exchange? From you criticism, I gather that you seem to think that education does not involve any studying, but simply going out to the field and playing a game of football or something, or that studying is really enjoyable (I doubt).

    In your criticism, you seem to dwell on the point that the purpose of education is not to get marks but to get an education, which the e-mail was never meant to question, and is not relevant to the point in discussion. I thought we were discussing socialism, not what education is for.

    The main point of the e-mail was stated clearly at the end: -To show that everyone is selfish and competitive, and wants to receive higher returns for the work they’ve done, or else no-one would want to work, as rewards are the only motivation to work.
    -The world’s not a charity and resources aren’t generated out from nothing. There is no free lunch.

  8. Hi John,
    “Students study for marks, which generates self-satisfaction and thus a sense of happiness,”

    Well, no, they don’t. Students study to learn. No one I’ve ever met would believe that students study to earn marks.

    If students studied to earn marks, then students would outsource their studying (ie cheat) and everyone would be fine with it. But they are not.

    There is a false equivalence of money and marks, hence the email is wrong.

    It is absolutely essential to point out this is a false equivalence to understand different kinds of value, besides money, that can be derived from a range of practices, including all dimensions of education, teaching and learning.

    I certainly played a great deal of sport when in high school and as an undergraduate. Education is not playing sport however (although sport can be educational). Studying is hard work. I have never stopped studying and researching, even when I was not working as an academic, because it is enjoyable and satisfying.

    Studying for the enjoyment and satisfaction of learning is probably more useful in the era of constant change (so people learn how to adapt, etc.) compared to any other era. It involves a set of skills that can never be taken away. Studying is a transformative process that should be seen as an investment in a possible (better) future, not as an exchange for some arbitrary number.

  9. @John

    Students do not study just to get marks. Sure a student tries to get the best grade he can, but ultimately what he wants is the knowledge. If I just studied to get the highest mark I could, why would I bother doing a Bachelor of Science, It requires a hell of a lot more effort than an Arts degree and I’m sure I Could get a much higher mark doing that degree instead. The reason I do Science is because I love it, I don’t frankly give a sh*t about what mark I get so long as I pass. What I really want is a better understanding of Physic’s and Chemistry (my Majors), because, as the OP clearly stated, students study to learn, not to accumulate grades.

  10. The analogy in the email is wrong in so many different ways. Using this analogy the complex discussion is so diluted that it loses all the essence of reality. So for a moment if I agree to the analogy that students study for marks like people work for money. Here below is the analogy to capitalism. If I think a little more I can come up with better points but just for argument

    So there are things like.
    My father has A+ through out his education and is an accomplished doctor, so can I directly start performing operations ? (This is what family businesses do in capitalism)
    Because marks brings power can I lobby and change the grading methodology if any of my father grandfather or I are a A+ student. Different kids will be graded differently based on the loopholes in the law. (Thats how super rich get tax breaks)

    I cant think more on such a silly topic. This email is so silly that I am really upset to see so many shares on facebook, hence ranting it out. Please dont over simplify a complex problem of the society suiting your own agenda. This is a complex issue and let it be so.

  11. Hi,
    I believe the better economic systems in the world are the ones that encourages individual capabilities/hard work/ideas to flourish but at the same time making sure that every one has the basic necessities met. This is a mix of capitalism/free market economy with a moderate governance that focuses on people and ensures that money is not the only driving criteria for making every policy decision sidelining majority of the people. At least governance should make sure that every one who has capabilities to do something is having a more or less level playing ground in his lifetime to achieve something with his hard work.
    And for the argument made in the email—I agree with his logic of average going down. I read some of the comments mentioning that students dont study for marks etc…I think some of the people who made comments there really didn’t understand what is really meant by competition.For ex, I have attempted to get into some of the educational institutions in india, where your odds of getting in are minimum 1/100.i.e. minimum of something like 1000 for every 100,000. Now this is the same for everything in countries like India, to get good schooling, college, job,..you name it. And the differentiating factor every where is your marks — or you need to be filthy rich who dont really need to run in this crowd. This is the situation in most part of the world where the ratio of resources/people are skewed too much. Now the kids in these countries are trained from day 1 in their life to run faster else they will be left behind.(The so called motivation is either within you or from your surroundings) And I am talking about a hundred million kids. The impact of this crowd is felt even in western world in the form of IT engineers from India, or as a manufacturing worker from China.
    Whatever the so called ideal system of no rewards working would have been working for 0.01% of the people (and I agree that such people make a difference for humanity–there will be Eistein, Newton and even the likes of Steve Jobs in every generation who do not work for money, but for the sheer satisfaction of doing/having good work,to stimulate their brain), and more important you cannot devise/design a system based on this assumption.
    When our resources are less and the people who need it are much more, my simplest assumption would be to encourage competition — set a bar, and the bar will be raised by the crowd, and by generations to come. (But don’t forget the ones who fall behind.)

  12. As with all analogies, they are intended to get across a specific point. They all break down somewhere along the line. So to try and stretch any such thing beyond its intention is, at best, misleading, and at worst disingenuous. Point being, it doesn’t serve to misuse (or overextend) an analogy.

    The point that the teacher was trying to make is simple, but in many ways ingenious. Students, regardless of what else is said, DO in fact work for grades. Some more than others, but all of them are trying to get good grades – if for no other reason than to get into the university/college of their choice. Motivations are legion, but grades are an inevitable enticement. The grades themselves are nothing just as the piece of paper used for money is nothing. But having that grade (or money) credited to you is something different entirely. So people work for money (to pay bills, get food, buy yachts – whatever the use, it is useful) just like people work for grades (to brag about, to show their parents and keep/get privileges, to get the grades to get into a certain profession and make lots of money etc…). The point there is that both the short-sighted and long-sighted student will both work for grades just like the profligate spender and the thrifty saver will both work for money. They are comparable motivations.

    As to the assertion that they can’t be compared because education is an end in itself, that’s a red herring. Otherwise, why have schools at all? If education for the sake of education is the motivation for school, then why grade? Why allow students in school who don’t care as much about the learning as they do the grades? If it takes 15 years in school for someone to learn that grades don’t last, how long will it take for someone to learn that the money doesn’t matter either? It’s a matter of perspective and, in the end, all that matters is “Does money motivate?” and “Do grades motivate?”. They both do. They both have zero intrinsic value. They both are worth what they are worth as a medium of exchange (though the mechanics are admittedly different).

    So what it boils down to is that a one-to-one (as close as possible) correlation between input and output, risk and reward, work and remuneration is inevitably the best way of ensuring achievement, order and advancement. Students generally won’t excel without some motivation. Workers generally won’t perform at a high level if their efforts are not recognized and rewarded. It’s just human nature. And the country that determines not to reward achievement with commensurate reward is the country that will languish and, eventually die out.

    And, ultimately, that comes down to whether government is your provider or you are your own provider. And for those that, for legitimate reasons, can’t provide for themselves, those that can help out should do so. But it should be done willingly. And in a free society, where people are recognized and rewarded, it’s amazing how quickly that provision also finds its way into the hands of the less fortunate. And for those still not provided for, THEN government can step in and ensure that they have something. But it should always be the last option. Reliance on faceless bureaucracy for life’s provisions encourages abuse.

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