The Stand-up Economist at the NY Times*:
My recent research with the economist Elaina Rose, published in August in the Journal of Economic Behavior and Organization, has looked at a real-life public goods situation faced by students at the University of Washington. During our study period (1999 to 2002), when students went online to register for classes each quarter, they were asked if they wanted to donate $3 to support WashPIRG, a left-leaning activist group. Students were also asked if they wanted to donate $3 to Affordable Tuition Now (ATN), a group that lobbied for “sensible tuition rates, quality financial aid and adequate funding.”
You may question whether these groups actually serve the common good, but that’s mostly beside the point. Regardless of the groups’ actual social value, a purely self-interested individual would choose to free-ride rather than contribute; after all, a single $3 donation is not going to make a noticeable difference in tuition rates. ...
Yoram goes on to explain their findings: economics students are less likely to donate (after disentangling the nature versus nurture complication -- click the SUE link above for more substantive comments). And concludes:
Our research suggests that economics education could do a better job of providing balance. Learning about the shortcomings as well as the successes of free markets is at the heart of any good economics education, and students — especially those who are not destined to major in the field — deserve to hear both sides of the story.
This is something that has been puzzling me. Do rank and file economists really overlook market failure when teaching micro principles? I certainty don't (obviously, given the title of this blog), and I don't know anyone who does (my favorite line is "the invisible hand works really well ... except when it doesn't"). Why does this seem to be a problem with economics education these days? And please don't cite Inside Job, because that is a completely different problem.
*I didn't think Yoram's piece was very funny.
