I just finished The Economic Naturalist by Robert H Frank a couple of days back and one of the questions was why managers who believed in achieving improvements in performance of subordinates through threats and reprimand rather than praise and reward were more likely to be able to prove that they are right.
Professor Frank suggests that it was because the performance of people usually varies with time but stays the same on average without special effort to improve or skive. That means that when a person perform badly it could just be his particularly down period and after getting scolded from the manager his performance tend to return towards the mean and result in the improved performance the manager was hoping for. On the contrary, a person may perform exceptionally on an especially good day and get praised for his work only to have his performance return to its mean, which means poorer than before the manager’s rewards/praise. A manager who believes praise and reward yields better returns would thus have little means of proving he is right and so is unfairly proven wrong.
The truth seems more complex than just that. As this article from Harvard Business Review suggests, sensitivity to the anger or happiness of the manager or boss depends partly to the stress levels experienced. So from the perspective of the employer or manager, it is wise to inject more praise and rewards during high stress periods. Never mind the low stress periods when employers are slacking around.
Human behaviours and the motivations behind them are great subjects to study. This gives me the chance to introduce the publication, Psychology Today, which recently featured something really useful for people working in the business world (and perhaps even in academia). Confidence in yourself and your ideas really counts when it comes to presentations. So you will really have to work on yourself to get your ideas accepted. Check out the publication site for more of such tips to help discipline, aid and make sense of your mind.
The Straits Times caught my attention again the week before with a particular article by Robert Skidelsky, which was a contribution to Project Syndicate. In Keynes versus the Classics: Round 2, Skidelsky highlighted the problem with today’s Keynesians being unwilling to work out the implications of irreducible uncertainty for economic theory. The article was essentially a response to the two economist, Krugman (his article) and Cochrane (his response here and here) who are engaging in an academic quarrel of sorts.
Krugman started out criticising the love for elegant economic theories of classical (implicitly speaking, Chicago school) economists. And Cochrane shot back, arguing that to attribute excessive fluctuations in the market to ‘irrationality’ is theoretical nihilism. And we all know that all that buying and selling has got motivations behind them even if these were results of false information, pure emotional preferences. I like Skidelsky’s analogy about the theater on fire (which might have been used previously by other economists as well):
It’s like what happens in a crowded theater if someone shouts “Fire!” Everyone rushes to get out. This is not “irrational” behavior. It is reasonable behavior in the face of uncertainty.
I’m not sure if Robert Skidelsky is a Post-Keynesian like Hyman Minsky but his extensive research into John M Keynes has brought him to write several volumes about this economist once touted as a saviour of capitalism. In any case, I believe Keynes simply sprinkled some important ideas that are pertinent to our study of the economy and there is definitely a need for further studies into the insights of Keynes about our modern capitalist economy and possible save it from itself once again.
The economy doesn’t (always) tend towards equilibrium as classical economics textbooks suggests. But things are worst when things tend towards an equilibrium that doesn’t benefit the society in general, many social phenomena that I’ve described in a previous post. The social/market forces are pushing the situation towards something no one wants; without an authority mandating stuff, no one have the incentive to help reach the collectively beneficial outcome.
In a recent article by James Surowiecki in The New Yorker, he discusses how success of big banks builds upon success and bring about the mega big banks that results in a concentrated banking system. It is thus possible that we allowed banks to grow big and stay so because the market naturally tends towards that and we have problems assessing the welfare gains from increasing bank sizes, as suggested by Surowiecki:
The trouble is that the “market” for banking is so distorted—by switching costs, by government subsidies and guarantees, and by the banks’ market power—that it’s hard to know whether big banks are adding value or are simply exploiting their oligopolistic positions.
The only problem that we know with the concentrated banking system is that they increase financial risk. That being said, regulations will have to start moving towards managing the risk that is contained in the financial system and if this really do result in policies that have to limit the size of banks then so be it. The government is the only one who can act as a dam holding up the floodwaters of market forces.
This week’s package of video, audio and reads is a little more on the lighter side, starting with a short 3-minute talk by Dr Laura Trice about asking for praise. After that you might like to listen to Dan Ariely‘s talk on our buggy moral code, a topic I’ve always been interested in.
In news, you might be encouraged to understand that Genius and talent is overrated and social forces can manipulate the motivations to create genius sheerly through encouragement as argued by Steven Levitt in SuperFreakonomics.
I’ll like to take the chance to introduce Knowledge@Wharton, which offers high quality content as well as podcast on economics and business issues of the day. You might like to listen about questions posed on Net Neutrality.
This is a book review written long ago before kevlow.com existed and was previously housed in another blog by Kevin L.
It was a very abrupt purchase. Harris was giving it a 50% discount together with another book by Khaled Hosseini, A Thousand Splendid Suns. I just bought both together since they’re pretty decently priced for fiction. I normally don’t like to own fiction books because they’re usually printed on lousy paper for paperback versions and mostly because they have no particular reference value unlike non-fiction (not to mention the fact that I don’t re-read books).
Kite Runner is one of the rare good books that gives you a story based on a setting and culture very foreign to our own. As Asian, I can understand the way females are treated and how some of the traditions are somewhat biased against them although they are fortified with justifications usually based on the idea of ‘protecting’ the women. In the book I get to see the Pashtun people’s version of such in Afghanistan. I’ve long read about the Pashtun people in one issue of The Economist long time ago and I understood how they were more or less more abiding by their traditions and customs than that of the Muslim types of law (please don’t correct me if I’m wrong because I wrote all that based on my impression of what I’ve read in the article and I shan’t take responsibility for making any mistakes here).
In essence I saw the book as a narrative to learn about the lives of people in Afghanistan before the Soviet Occupation and all the subsequent wars fought there. I learnt the excuses of the different warring parties and I learnt about the lives of the people there after that. Otherwise, the narrative is about brotherhood, betrayal, ethnic discrimination and foreign cultures. It is definitely refreshing to get a dose of fiction amidst all the non-fiction reading I’ve been doing, including a ‘Apache, mySQL and PHP in 24 Hours’ (which of course I didn’t even read for 5 hours not to mention attempting to learn the entire book in 24 hours).
I’ll recommend it to people who’d like to know more about the Middle East, the diversity there, the relationship between Pakistan and Afghanistan in terms of the people. Alternatively, people who would like to see the people’s perspective of Afghanistan through their modern history would most likely be interested to explore the book as well. At times you’d find their cultures weird, extreme and slightly unnecessary but you will also find a thick sense of ties and kinship that you’ll almost find nowhere outside Asia.
This is a book review written long ago before kevlow.com existed and was previously housed in another blog by Kevin L.
After 2 months of reading I finally finished Naomi Klein’s powerful book, Shock Doctrine. It was a long ride deep into the dark old mines of history on the different ‘economic revolutions’ all around the world: Argentina, Chile, China, Russia, Bolivia and Poland. It was a book that was written with intentions to put down Milton Friedman, clearly anti-corporatist and in some sense, anti-globalization. From this book I understand finally how the term ‘anti-globalization’ have been mis-interpreted by so many people, even myself. I once thought that it means being against the integration of cultures, economies and companies but then I realised it gets way deeper than that.
The idea of anti-globalization is usually used to mean being against the way the phenomena is taking place in our world, that inequality is rising and corporates are like taking over the world while people in poor countries work in sweatshops, suffer in silence and endure the hardship only to realise generations later that nothing changes. It is the discovery of a certain helplessness in the bottom layer of the world. Shock Doctrine is clearly about that, and more.
In a clear but otherwise way too long writing, Naomi presented a very complete picture of how pure ideology-driven economist are used by corporates and government to advance their self-interest. And of course, in a capitalistic perspective, self-interest is just profit and money. She didn’t over turn free market theories on how a perfectly free market is able to dilute power and increase freedom but she did show that the approach that allows for extreme free market is not exactly compatible with democracy and worst of all, economist have been naive about how a free market can be brought to exist. Case after case cited in the book, firms are privatize just be selling it out to the private sector without proper valuation of the assets and this hasty act would not only delay the attainment of a market equilibrium that would be at least more socially optimal but also create new forces that increases the inertia of the market. In other words, it makes the market less free.
In the area of corporate America and politics, Naomi is suggesting that the corporate people have penetrated politics too deeply with CEOs becoming civil servants in top positions of the government and politicians being lobbied by powerful companies with CEOs receiving incomes more than 400 times the average person on the street. And because of that, government becomes ran like corporations, public sector jobs being slashed and direct public spending is reduced while outsourcing (locally, giving contracts to companies) all the functions that can be done by the private sector. Worst, it is infected by a touch of cronyism; and this probably explains why contracts are rarely distributed by bidding and that the contracts concentrate in the hands of the few big firms that are always ‘aiding the government’ with ‘planning’.
It has been a good read anyways and while Naomi Klein has a rather extreme stance, my reading of Joseph Stiglitz have helped me appreciate the gravity of the matters she was talking about and I could understand her thinking. As always, the writer do give us a gleamer of hope about what the future may turn out to be when the ‘Shock Wears Off’ and how we can prevent similar stuff from happening again. I would recommend this book for people who have no fear of heavy non-fiction reading, a thorough interest in learning how and why corporate America is seen in bad light.
A while ago, when I was still a student of a particular premier institution, I criticized how poor a particular subject department of the institution was. Ruiyuan told me when when I am done with my tertiary education in that subject, perhaps even after completing my PhD, I should write the department a letter to ‘thank’ them for inspiring me. My criticism at that time ranged from the quality of the teachers to the design of lecture notes as well as the general pedagogical approach adopted by the department. Note, of course, that this subject is a social science.
Perhaps I was too anxious, or that this issue have been with me for quite some time – I decided I should do a draft of the letter that I am about to send 8 years or so down the road. Matters then, (hopefully) might not be the same as the present but nonetheless, a nice draft should convince the future me that I took this matter very seriously. Here’s my draft:
To Whom It May Concern
We all know your department sucks, please do the following:
(1) Review your course material and provide more readings (or recommendation on additional readings). Use good English and make sure diagrams are well-annotated. Ensure that your chunks of text in the notes are really in point-form.
(2) Prevent wastage of lecture time by cutting down on the scolding of late-comers, starting lectures on time and removing the administrative need of marking attendance.
(3) Please teach concepts and theories and introduce the history of these discoveries as lesson progresses. Do not merely feed ‘answers’ to the questions you believe would come out for exams. Such ‘assessment-oriented’ approach do not imbue students with the desire to explore the subject for themselves.
(4) Do not make us memorize definitions just for convenience of the markers, it kills our passion for the subject. Focus on making us understand the subject and appreciate the predictive beauty of these theories.
Please consider my suggestion for the good of students passionate about the subject before entering our institution.
Thank you for your kind attention.
Student,
Vib
To save myself of trouble, I’ll probably be sending out the letter after ORD. Nonetheless, I hope to collect at least a hundred signatures from ex-students (my peers) who have done the subject to accompany the letter, as a demonstration that my letter do indeed holds majority opinion about the department in question. I would also welcome comments on modifying the letter to reduce the impression of an intentional, vicious assault of the department.
This letter was written in early 2008 as an expression of late teenage angst at my high school. Most details have been forgotten and the context is no longer very clear to me. It reflects some of my earlier writings that were expository but driven largely by my intellectual passion in education.
It has been quite a while since something bothered me to the degree this issue of how lousy your department is did. The last time was perhaps when I was in high school, when the rather incompetent humanities department head pioneered some rather disturbing means of assessment (Major Research Papers, as they were known) – that has since been resolved after it was replaced by some more experimentally disastrous modes of assessments, for which I was not subjected to (and therefore I see no issue with that). I shall, in this little letter, outline the faults with your department and offer my suggestions to ‘correct’ these problems.
I begin with the course materials for they are at the forefront of ‘educating’ your students. If anything else, it is the only thing that comes directly in contact with the learners of your subject. The design of your lecture notes have been kindly standardized, which presents organizational ease students would gladly appreciate, but no additional readings are provided (though I would think some students also appreciates this) and it is declared that whatever students need are within the notes issued. Further readings or exploration is discouraged implicitly this way. All notes are arranged in rather logical order that introduces concepts and definitions but it appears that more emphasis is placed on memorizing the definitions than understanding the concepts (this will be elaborated in the pedagogy segment later). Diagrams are poorly annotated and large chunks of text that follows diagram are in prose but ‘bulleted’, making it confusing for student as to whether to take the entire chunk of text as a ‘point’ in the theory or mere elaborations. Blanks are often placed in wrong positions because teachers edit their lecture presentations after sending notes for printing. I therefore suggest that all blanks be scrapped so that lectures can proceed quickly and that more spaces are provided between chunks of text for notes to be written. All conceptual points should be summarized and written in good English (read: good English, not just easily misunderstood English). All diagrams should be well annotated and unnecessary repetition of diagrams removed.
Lecture time are often wasted on administrative matters that demonstrates deep distrust in the student’s desire to learn. To attend a lessons in a premier institution is to expect no time wasted on unnecessary disciplinary remarks made by teachers and that both students and lecturers are on time. There is really no need to mark attendance for lectures or waste time waiting for students who are late. To miss out a part of the lecture should be the punishment in itself – there’s no need to humiliate these students by starting the lecture late on purpose and then claim these late comers responsible for the fast pace of the lecture or worst, the incomplete-ness of the lecture. Incessant nagging about student performance during lectures are not at all appreciated and seen solely as an avenue at which the lecturer lets out his/her steam on the students, achieving practically no effect on the grades or effectiveness of lectures (often even undermining that, as well as respect for the lecturers). There is thus no need for attendance marking during lectures, or the wait for late-comers, or any ‘disciplining sessions’ – lecture time should be left purely for lecture on the subject
Technicalities with course materials and the ways lectures are carried out aside, the pedagogy of teachers reveal a profound misunderstanding in the cognitive abilities of the students as well as the processes by which one acquires academic knowledge of a subject. A social science, or any rather scientific subject, should be taught with the hope that students understand theories and concepts, as well as the implications of them. Next step would be the application of these concepts on the real world, the ability to draw evidence, real world examples to support theoretical concepts and possibly critique the inadequacies of theory. Ideally, we should be producing students capable of explaining the theories and giving examples in his/her own words.
Unfortunately, your department focused all energies on teaching ‘answers’ of potential examination questions to students since day one. There is no appreciation for the knowledge to be acquired, no consideration given to the way concepts are used in the real world (whether it is the predictive or the explanatory value) and absolutely no respect was paid to the history of the subject. Authorities of the subject are rarely introduced – I strongly believe that understanding the settings at which certain theories surrounding particular phenomena are discovered would aid one’s critique of the theory as one would then understand the timing and circumstances for which the concept served a valid explanation for some phenomena. Such ‘assessment-oriented’ approach would be seen as an indication of laziness in part of your department (if not ignorance), perhaps only interested in the results of the students rather than how interested students are in your subject. What could illustrate your distorted ideology towards teaching more than one of the lecturer’s exclamation during one of the paper review sessions: “Please, I urge you to memorize all definitions, the exact wording of each and every definition as given in your lecture notes. Do not use any definitions you picked from elsewhere or constructed yourselves because their wording are often wrong or difficult to interpret and this frustrates the markers. That means they have to waste more time on your paper and you’ll probably be given lower marks for that.”
It is perhaps why I come to realize how some of my peers who were initially curious about the subject were practically put off by it, possibly till this very day. I have no idea if this was your department’s intention but I was lucky my initial passion for the subject (built from the numerous outside readings and a steady supply of magazines on the subject) was never watered down by your horrible approach to teaching. That I went on to pursue tertiary education on this subject could only be attributed to the fact that you and your fellow colleagues have failed to practice the flawed pedagogy to its extreme for you all are still human. Of course, you might try to refute my claims by highlighting the numerous students pursuing further studies on this subject who are from our institution. That I do not deny, for it is the innate allure of the subject and perhaps the demand for knowledge in this field that have drawn this intellects towards the subject. In raising this point as a rebuttal, your department should thank God your screwed approach was not consistently applied (plausibly due to a few rebel lecturers who truly believed in the subject and loved that exploration).
I have, in the course of my education in the institution, approached tutors of the subject (ie. your colleagues) regarding some of the matters I have pointed out above but they all appeared to shrug at them. Replies offered ranged from ‘instructions by the department’ and ‘every tutor in our institution is doing it this way’ to ‘that has been the case all along and we have no problem with it’ and ‘you are a special case, I don’t think other students would think this way’. My friends have suggested I return to teach at my alma mater and clean up the mess I observed in my school days. I hope that this letter will just do that without having me to compromise my future.
I realised that I have been doing things so much more slowly than in the past; while that means I savour the words of the books I read, it also mean that I am absorbing the knowledge more slowly. As I work on some simple HTML with some of the sub-sites of this domain, I once again feel that I am not working fast enough. A day is sometimes lost with me just doing 2 activity – reading a book (not even completing it) and chatting online. These are real unproductive times. I suspect that it’s the lost of a very structured stress system (ie. the education system and the rat race in action) that has to do with my decline in productive activity. It is scary how we may actually be tempted into this sort of comfort. I suspect it is the same sort of virus that inflicts the civil servants of the past and the teachers who taught us when we were kids. They are not directly faced with the rat race in the society, protected by the job security and income stability – the only threat was probably inflation, which is alas, well controlled by wage-restraints in the days of economy-building of Singapore.
Nevertheless the rat race must have some effect on everyone involved as long as one is connected to the rest of society and for me, it has influenced me through the fretting of university choices and courses to study. Actually course is more clear-cut to me, university is not because of my ability to pay and whether I even qualify for admission. In some universities, I am competing on the basis of my brains and excellence in demonstrable fields (with the rest of the world) because all applicants are such. Other universities would force me to compete on basis on my brains with a select bunch who are as poor as me and admission will lead me on to compete with those who are rich but not necessarily capable. You may have notice that I don’t seem to be looking out for university based on branding or quality of courses. However, my search for ‘competitive spaces’ would naturally fulfill those requirements.
If I am not wrong, Jack Welch once mentioned in some university’s commencement address that if you have no idea what organization to work for, just go for the branded ones. In the same vein, if you don’t know what university to get into, just go for the best that you can possibly afford. In the society, stuff like universities and organizations have positive network effects from name and by joining them, you benefit from an established social network, a ready pool of already successful people (often by ability but sometimes also because of the organization brand name). By searching for ‘competitive spaces’ or choosing who you want to compete with in the environment you are heading into, you naturally seek out that kind of brand that best suits you.
For those who wants to study local, I have an argument for going overseas, and to me, it is a powerful argument. In fact, I rather use another perspective and reduce the arguments for studying local. Yup, I’m going to say that convenience, security and safety are ‘pros’ only for the weak-willed and weak-minded. Nevertheless, I want to point out something in relation to ‘competitive spaces’ that local universities are unable to provide. Having been in the asian-styled examination based competitive system, I do not think that at tertiary level we should be continuing with that – we need a chance to be engaged in other levels of challenges and emphasize other platforms at which we complete. On top of the system that serves to structure the rat race, there’s the type of people as partners or competitors, which we will have to look out for when selecting the ‘competitive spaces’. Ask yourself whether you want to compete in a cohort made up of more or less the same people whom you have been fighting with the past 15 or so years. Yes, there is a change in composition of the entire cohort but remember that the experience of those around you if you study local would very much be the same as yours.
No doubt a decade or even less time down the road, Singapore may be cosmopolitan enough to support a diverse mix of people with different educational experience in the local universities – I do not question that, but I am thinking about here and now. Right now in selecting ‘competitive spaces’, one need not even look at local-foreign distinction – one simply have to select the sort of competition he hopes to be in for. Of course, due consideration still have to be given to the ability to pay and so on.
I seem to have diverged from my point about searching for stress to motivate myself, but that’s actually what I just did. I was exploring something that was simmering inside my mind too slowly. I had to write them out to get them clear. I have been trapped in my stream of thoughts about these issues sometimes because I either digressed into some self-discussion about the ethical dilemma schools may have if they are solely need-blind to students of their own country and not international students, or that I throw myself into a downward spiral of negative thoughts, questioning my ability to even compete against brilliant minds around the world. Right now, I just have to be more logical and rational with my approach and then force myself to work faster with the decision-making and research. Oh yes, and through this thinking as I write, I just introduced a new structured stress system to myself.
This is an article draft penned some time in 2008 reflecting the style and content of my earlier writings driven by my intellectual passion for education and pursuit of knowledge.
Social Scientists are plagued with this particular divide that is non-existent in the word of Arts and Science. Well, there are cases of particularly weird arts-science mix of beings like Euler, who, as one of the greatest Mathematician, devoted substantial time trying to introduce mathematical notations for music and in essence, mix everything music and mathematics up. It’s as if vector geometry and complex number’s correspondence, but this time, things just get a little more complicated as more of our senses becomes involved in the concoction. But Euler is really rare, and he cleaned almost the entire realm of mathematics of quirky symbols that everyone everywhere would not agree upon and introduced the whole idea of ‘functions’ and it’s notations, without which, we may not be even able to learn programming language because of the sheer complexity of the machine codes kind of ideas.
Pardon me for the introduction that seem to have absolutely no link with the title itself, but in all, I was attempting to demonstrate that there are poetic social scientist who sees humans as being somewhat divine and miraculous and studies the non-mechanical, the purpose-fixed aspects of humans, stuff like aggregate ontology (if there’s even such thing) or philosophies that involves questioning of functions, fundamental reason. For me, I prefer to look into the observable patterns, and the parallels between science and humans themselves, and how laws that govern nature often has its twin doing similar things for the humans. These laws, when stripped to its barest level, is as good as a gravitation acceleration constant – absolutely meaningless. I therefore, must propose this idea of segmenting the human world into 2 layers – 1) Before Reason – the layer void of reason, like molecular interactions, the existence, and many questions that philosophers can debate for another millennium and fail to obtain answers for, all the laws that govern things before human participation, and 2) After Reason – the layer of purpose, where we can explain things after making some assumptions and ignoring the previous layer. For example, when we ask why he went to the post office, we are satisfied with the answer that ‘He went there to get some stamps for his friend’. In that sense, we ignore all the layers beneath, like why his friend need stamps, why is he the one getting it, and if his friend can’t get it, why, and if his friend is attending some functions, why is he doing so and this goes on up to a point like, ‘why is he in this world’, and even further, why his great-great-great-great-great-great-great-great-grandparents exist’. This asymptotic line of reason is the transition to the previous layer, where there’s absolutely no point of explaining things, and not possible anyway.
That was a preamble to thinking about things, and I have chosen to express the above concepts in a more mathematical, and scientific way so that it aids understanding. In any case, I have selected certain laws that are throwing their weight around the scientific realm to explain social sciences, and here, I shall be elucidating the effect of intervention of nature’s equilibria.
