Andrew vs. Andrew (continued)

Following on from yesterday, Andrew Norton has his second piece up [A.N., A.L.].  He continues on the early topic of teaching civics, concluding with:

In my view, preserving public education to teach civics is a non-solution to a non-problem.

I’d love to see a longitudinal study looking at what people covered in school and measures of their criminality, understanding of and participation in democratic society one, five and ten years after leaving school.  Until then, this aspect of the debate will continue to be rhetorical.

A.N. then moves on to the topic of financing, acknowledging A.L.’s point that there are economies of scale but arguing that they could be achieved through school associations or chains.  He suggests that the government still be involved, subsidising schools on a per-student basis inversely weighted to the students’ socio-economic backgrounds:

[W]e could fund all schools on a similar basis to private schools now, according to parental SES background. That would lead to reduced rather than greater government expenditure, with tax cuts helping parents finance higher private outlays. Schools servicing the most disadvantaged areas would get the most money, providing what was necessary to make private schools viable. Schools in the most affluent areas could be taken completely out of the public funding system; this if nothing else about my proposal would please the AEU. 

This seems a reasonable and persuasive point to me.  However, since it would amount to the government paying for the schooling of the poor, it seems implausible to assume that they would not want a say in how the money was spent.  It would be, in effect, an Australian education equivalent of Railtrack/Network Rail in the UK – a nominally independent organisation that nevertheless operates with a government-backed guarantee of funding to achieve government-stipulated requirements.  This may well represent an improvement over the status quo (and I suspect it would be, from a financing point of view), but it is not full privitisation.

I was never particularly concerned with financing except insofar as it affects selection.  This sort of scheme, which does keep the government involved, may help ensure that every child gets accepted somewhere, but my concerns about student complimentarities and the need for national education standards remain.

Worth following …

Andrew Leigh and Andrew Norton (you can find a brief introduction to each of them here) are having a “bloggish debate” on whether public schools ought to be privatised. You can follow the entire discussion at either of their blogs. We thus-far have an initial comment from both. The first came from Andrew Norton [A.N., A.L.]:

… The government owns most schools, employs most teachers, tells them what to teach through state-set curricula, and examines students to make sure they have it right-even kids escaping to private schools can’t avoid these last two aspects of state-run education … Across the political spectrum, activists want to use public education to influence young minds. In his book Dumbing Down, Kevin Donnelly documents how left-wing academics and teachers shape curricula to fit their political agenda. In government, the Liberal Party proposed a national history curriculum, which was widely seen as another front in the so-called ‘culture wars’. Rather than fostering social unity, as some of its supporters claim, state-controlled education is a source of division and nastiness. Instead of allowing different groups to devise their own curriculum, and letting parents choose between them, we fight over a common curriculum …

In response, Andrew Leigh argued [A.N., A.L.]:

… indoctrination isn’t all bad. I’d like to live in an Australia where children shared a basic understanding of democratic values, and understood our geography and our history. I’m more confident that public schools will achieve this than I am about private schools … you’re either arguing (1) for the private school funding to be raised to the same level as public school funding, or (2) for the government to get out of the schooling game entirely. Fortunately, we have an interesting natural experiment of reform (1). In 1981, the Chilean military government passed a law (or whatever dictatorships do to put things into effect) that gave the same per-child funding to non-government and government schools. Fifteen years later, 62% of kids were still in government schools … Public education is worth preserving because it helps engender shared knowledge and values; because a public system guarantees access for all children; and because its economies of scale will often make the public sector more efficient than the private sector.

I love reading both Andrews on education. They’re clearly both incredibly smart and thinking incredibly hard on a topic to which most people simply apply a few platitudes and rules-of-thumb. A few of my thoughts, which I’d love to see them discuss at length:

Selection. Private schools are selective, meaning that only the smartest (or wealthiest, or most religious) students are granted access. If the entire system were privatised, what school would accept the academically-below-average, non-religious poor?

Conformity risk. On the other hand, the one-size-fits-all approach so often seen in public education is an imposition of conformity and can lead to the supression of individual talents.

Student complementarities. The success of a student in a subject is arguably positively influenced by the success of their classmates. Even if complementarities do not exist in student ability, they may still exist in student behaviour. Separating the most- and least-able (or most- and least-disruptive) students will benefit those in the advanced grouping and disadvantage those in the lower group. If present, this effect will be greatest for students close to the cut-off in both directions, meaning that there will be a sharp, essentially discreet difference in group performance.

(Dis)Economies of scale and profitability. As mentioned briefly by Andrew Leigh, schools experience economies of scale in minimising costs. However, there are also diseconomies of scale in maximising student performance once classes get too large. This means that private schools would not set-up shop in areas of low population density and that public schools focused on getting the maximum quantity of education for the minimum cost often sacrifice quality in areas of high population density.

Standards and externalities. Government involvement helps ensure that a common, minimum set of standards are met by all students. Employers and universities need to be sure that school-leavers have certain key skills and be able to compare candidates from different schools. I’m happy to assume that the market would produce a generally-trustable measure of the first of these requirements, but not the second. Witness the lack of interstate university attendance in Australia where there is poor comparability of students across states, compared to the high student mobility in the U.S. where the S.A.T. serves as a single, national standard. The S.A.T. is not perfect, but the comparability it offers increases competition in both directions between student and university.

In addition, society as a whole may wish for a third set of standards that are not direct prerequisites for employment or university, such as a minimum understanding of history or civil society. This final point rests on the positive externality of such education. A country’s institutional strength – arguably a cornerstone of growth – may rest on a commonality of feelings of civic duty, for example.

Teacher quality and incentives. I doubt there will be much disagreement between the two Andrews on this one. If they mention it at all, I suspect both will support some form of incentive pay to teachers on the basis of student performance. Personally, I would argue that to the extent that student complementarities exist, at least some of any incentive payment ought to go to the school as a whole. I also wonder if the measure of success ought to be broader than on-the-day performance on a standardised test and perhaps attempt to focus on the students’ outcomes. For example, one year after leaving school, look at whether students are employed or in higher education and if they are in the latter, look at the cut-off for the course they chose.

Full disclosure: I attended a state school for years 1 to 7 and a (small) private school for years 8 to 12. My mother has worked at that same private school for close to 18 years.

Continued tomorrow …

A tight race in Bowman

The overall result may not be in doubt, but spare a thought for Andrew Laming (Liberal, incumbant) and Jason Young (Labor) in the Queensland seat of Bowman.

Before the election, Laming held the seat with an 8.9% margin.  It was safe, but not that safe and by the time of the election, the betting markets were leaning towards Labor (thank you, Simon Jackman). Turnout on the day was 85.25%.  With those votes counted, the primary count went to Laming (33,833 vs. 32,498), but the two-candidate preferred count is going to Young (36,693 vs. 36,672).

That’s a margin, on current counting, of just 0.014%.

The pre-poll, postal, absent and progressive votes are still being counted, but you’ve got to feel for those guys.  If Laming hasn’t worn holes in the carpet then I’m a monkey’s uncle.

Update 29 Nov 2007:  With a bit under 2,000 extra votes counted, Young appears to have squeezed a little extra traction from one fingernail.  He’s now got a margin of 0.040% (37,690 vs. 37,630).

Oz Election

Well, the Australian election is getting pretty damn close now.  A few random thoughts:

  • Both at an aggregate and at a seat-by-seat level, the betting markets have blown out in favour of a Labor victory.
  • There have been plenty of predictions of exactly how many seats Labor will win, but as ever, Bryan Palmer does a superb job of aggregation and analysis.
  • We have, as Joshua Gans puts it, “US style election-lawyering” from the Coalition, who have released legal advise suggesting that 13 Labor candidates may be inelligible to stand.  I am entirely in agreement with The Possum on this one:  “Sour grapes do not play well with the electorate, threatening to bring in lawyers to try and overturn the election result looks bitter. Not accepting the umpires decision, and threatening to take your bat and ball and go home looks pathetic.”
  • Andrew Norton has some good work in looking at the reasons why the Coalition are on the nose.  His prognosis:  expect a long time in opposition.  I’m not sure I agree with him, but I can’t really explain why, so I’ll just shut up and direct you to him.
  • A friend here in London was voting for somewhere (sorry, I have no clue where) in NSW and thanks to the beauty of the Australian preferential voting system, had to rank One Nation, Family First and Fred Niles.  I really don’t know how I’d put them.

Oz Election (again)

I’m still not that interested in general, but these two bits looked interesting in their specifics:

  • Looking at Bryan Palmer’s “Day 6 report,” it seems that the betting markets have started moving sharply in favour of the Coalition. Labor is still being billed as the favourites, but it’s narrowing fast.

* The action is really at the top. The only difference between the Howard and Rudd tax cuts is that Rudd wouldn’t cut tax rates from 45% to 42% for those earning over $180,000. Assuming the same rate of wage growth that we’ve had over past years, only 1.4% of adults in 2010-11 will have an income in that range, while only 3% of families will have an income-earner in that range.

* This means that the richest 1% of families get 7% of the Howard tax cuts, but only 4% of the Rudd tax cuts. The richest 10% get 28% of the Howard tax cuts, but 25% of the Rudd tax cuts.

* The education credit is fairly evenly distributed across the income spectrum (as Labor pointed out on Friday, 2/3rds of families with children are eligible for it). So the Rudd package looks more even – but only a little – if you take account of it.

The Election in Oz

So, the campaigning has formally begun for the 2007 Federal Election in Australia. I’m interested, but mostly in an abstract sense and at the same time have a definite feeling of “blah” towards the whole thing. When I do end up wanting to know what’s happening, I’m pretty sure that Bryan Palmer will be a superlative aggregator of information that I ought to care about.

I did notice, with a sigh and a rolling of eyeballs at the stereotypes involved, that the two sides are squabbling over the debates: how many to have and when to have them. The Coalition is calling for just one and early in the campaign (before most policies have been released), while Labor wants three spread out over the entire length of the campaign.

Richard Freeman, WorkChoices and the dead hand of government

Richard Freeman is continuing his assault on WorkChoices:

[T]he new Australian labour code is such a massive break with Western labour traditions that it merits [global] attention. It was enacted in the midst of prosperity, without union or management excesses that endangered the economy, or public support. From the perspective of social science, we cannot get much closer to the ideal random assignment experiment at the national level than WorkChoices – an extreme change in law with no economic rationale or cause.

… Downloading the Workchoices legislation, I found a 687-page law with 565 pages of accompanying memorandum, all amending [i.e. not replacing] the government’s previous 861-page labour act …

… Parts of the law made so little economic sense that it seemed as if the Howard government had found a new band of whigged judges and labour lawyers to write it, on behalf of management. Which, in fact, I learned, was more or less how the law was developed. Writing the law was outsourced to the major Australian law firms that represented management …

… If re-elected this fall, the government will stay the course with Workchoices and we will see the results of this extraordinary effort to destroy collective action by workers. For the sake of social science, it would be great to see the experiment carried through to completion. For the sake of Australia, it would be great to see the election end the experiment.

He has managed to attract the attention of Justin Wolfers, guest-blogging on Marginal Revolution:

This is what happens when conservative governments confuse decentralization and deregulation.

Professor Freeman visited Australia back in September, speaking at the University of Sydney (I can’t seem to find a transcript online; only the event details and the press release) and on the ABC. He is not without his critics on the topic, but I think his points are valid. Even if you hate the unions, you’ve got to oppose Workchoices for the sheer weight of it. Where are the small-government Liberals in Australia?

Cam Riley wrote on this a while back:

When I read through the Workchoices legislation a while ago it was a brain dulling experience. The bill was long, boring and complex. It recently received a one hundred and eleven page amendment to add to the Workplace Relations Amendment Act, the Workplace Relations Amendment Bill, the Explanatory Memorandum, the Supplementary Explanatory Memorandum and the Second Reading Speech. Human Resources just got job security in the same way accountants do with the complex tax system.

Have a look at the graphs on Cam’s page. Make sure you take note of the scale on the vertical axes.

Meanwhile, John Quiggin has a suggestion for the Labor party in their campaign:

If I were running Labor’s campaign, I’d take the government’s total ad spending this term (around $750 million, IIRC) and convert that into around $5 million per electorate. Then find, for each electorate, $5 million of spending effectively foregone (two extra teachers at X High School, a local road project etc). Finally, promise to create a fund for worthwhile local projects like these, to be funded by a cessation of large-scale government propaganda.

Chaser and US newspapers

Andrew Leigh writes:

Which brings me to the Chaser, a program of such blokey irreverence it could only have been developed in Oz. For some odd reason, the Chaser lads have been copping flack over the past 24 hours for their APEC stunt. Watching stern-faced Mark Day on Today Tonight last night, you would have thought that the lads brought us within inches of armaggedon. Is it just me, or does anyone else feel a kind of cheeky pride at being part of a country where the public broadcaster pays comedians to dress up as Osama in a Canadian car, and attempt to meet George Bush?

It’s not just you. More power to ’em.

I do wonder about Andrew’s views on US newspapers, though:

When it comes to newspapers, theirs are unquestionably the best in the world – led by the New York Times, and followed at some distance by the WSJ, WaPo, LA Times, and others.

How does the FT not cut the mustard?

Two questions for the punters

1) Does the large gap in the implied probabilities of a Labor win in the upcoming Australian Federal Election between overall-result betting (62% at the latest update) versus seat-by-seat betting (23% at the latest update) imply some sort of arbitrage opportunity? Is the overround really that large?

2) Why the gap in the first place? I assume it’s got something to do with the particulars of just how marginal each seat is (see below), but why do the two markets disagree so much? Is one of them massively incorrect?

For those that don’t know, I’d recommend looking at the tabular and graphical representations of the marginal seats here. Here are the guts of it (there are 150 seats in the House of Representatives):

Uniform swing Labor gains Labor total Coalition total Result
2.92% (+13) 73 75 Clear Coalition win
3.27% (+14) 74 74 Sort-of-hung parliment (depending on the two independents)
3.27% (+15) 75 73 Sort-of-hung parliment (depending on the two independents)
4.85% (+16) 76 72 Clear Labor win

The first 13 seats for Labor only need a 2.92% swing, or 0.22% per seat. The 14th seat will take an extra 0.35%, the 15th a further 0.90% again and the 16th another 0.71% on top. Remember that each extra percent of swing to Labor takes an increasing amount of goodwill from the electorate (i.e. increasing your swing from 1% to 2% is doable, but increasing it from 25% to 26% is effectively impossible).