Friday, March 18, 2011

On Sheepskins, Passports, and What College Is Good For

William D. Cohan had an interesting though disturbing "Opinionator" column on Wednesday.

Apart from arguing that if you have something on the ball then a college degree may be irrelevant to your future career, a point I'll return to in a bit, he also argues that the college educated may have destroyed investment banking, by moving it from privately held partnerships to publicly traded companies that no longer had financial stakes in the loans they were making and then by coming up with all these fancy derivatives that masked what is going on but encouraged a rush of cash to come into the business.

I've been puzzling on this second one for a while. First, while it is fairly easy to see the harm that was created from all of the financial houses going public, I'm not sure Cohan or most pundits on this matter have seen the good that was created. It may very well be that much of the good has been captured internationally rather than domestically or if domestically then only by high level executives in the large multinationals. But still, there has been phenomenal economic growth in many Asian countries and in Latin America too. Were the capital flows that Wall Street generated a significant force behind that growth? If so, it is a story that hasn't gotten a lot of press.

The other thing I don't get is why there isn't, in essence, a co-pay model in finance. In my way of thinking, when a local bank initiates a mortgage, it should sell a big piece of it but keep some fraction of the loan, say 20%, not out of its own good will but as a way to assure the market that the loan is reasonable. And if the loan is not reasonable, then the bank should have incentive to block it, which I believe is what you want for the system as a whole. The same thing should be true for the big Financial Houses. There needs to be a handful of big shareholders who put up some of their own cash on the loans. The exact same principle applies. The size of the loan is not the important thing here. The issue is whether the lender really believes the loan is a good loan and if he so believes, let him put his money where his mouth is. What I don't understand is why the market hasn't come up with this as part of the solution on its own, totally without government regulation pushing the matter. After all, with our health insurance we have to make a co-pay when seeing the doc or picking up a prescription. Surely the principle is understood. What keeps it from being realized? I don't know.

Let me get back to the value of College. Since I have had my students blog this semester I have inadvertently learned their views on a variety of life issues. One of those is the nature of the work they will be expecting to do once they graduate. Many of the students are remarkably instrumental in their views, with a good job a means only, seeing as their end goal to satisfy their recreational pursuits and hedonistic pleasures. In my Behavioral Econ class we read an essay by Joseph Persky about John Stuart Mill and his approach to homo economicus. That Mill put accumulation of wealth along with the pursuit of luxury and leisure front and center resonated with many of these students. What I've yet to hear from most of them is that either instead of in addition they want to do good work so that what they produce can benefit others or they want to work where they get direct enjoyment because it is a means of self-expression. Either they are too immature to yet have those views or because across both classes it is mainly Econ majors and Business students, perhaps this is a selection of students who are prone toward these attitudes. Given their view, however, it is not hard to work through the backward induction on the students' attitudes about their college education.

It is one thing to read Cohan reflect about the value of a college degree on the New York Times Web site. It is quite another to read current students blogging about the issue, much more brazenly than Cohan. In my behavioral class, the first topic I had students blog about was procrastination, based on a New Yorker piece by James Surowiecki. Much of the blogging and commenting on this topic was confessional in tone and substance. In trying to draw one team out in its thinking, where my sense is that we procrastinate about different things for different reasons and the term procrastination is a catchall that refers to multiple different behaviors, I wrote:
I share some of the issues with bill paying. I do the finances for my mom, who is 90 and with dementia. Though she owns her condo outright, there are two different monthly fees for different associations that care for the place, and other bills for her care. I haven't automated the bill payment because I want to "know" what is being spent, but I hate to write the checks even though once I do it is not that big a deal.
The studying thing seems different to me because with students that's the main reason they are in college. It is not a trifling. I wonder if there isn't some deeper explanation going on with that. Perhaps we will peel some layers of the onion on that issue when we discuss in class.
One of the teammates replied:
Studying is such an arduous task that is many cases useless in the long run. This is due to the fact that business don’t really care that you did well in your Psychology or Economics class; they care more if you are able to help them in solving their problems . In response to Profarvan statement “”The studying thing seems different to me because with students that's the main reason they are in college.” Personally I don’t think the reason for being in college is to study but it is to receive a diploma with a fairly decent GPA no matter how it’s done. Hence, procrastination is an effective tool to put off studying until the day before the exam since cramming is effective to get a B/C letter grade most of the time.

In an article from Yahoo business it states that grades are not a predictor of success because if you can’t adapt or solve a company’s problems what good does a 4.0 GPA do. For example when I worked as a computer technician intern for a large corporation there were many full-time employees without a college degree or even a high-school degree. Not only were they better technicians than the college graduates they were smarter and more in tune what was going on in the emerging technologies. So I will keep procrastinating, I know the odds are stacked against me statistically but I will take the risk of procrastinating before an exam. I rather spend an extra 11 hours discovering and learning about new technologies than memorizing formulas and definitions that in the real world will be useless since a computer will do it for you the majority of the time. Hence I also agree with the statement of “ the present is more important to us than the future.”
To sum up, I think procrastination is highly useful in college due to the fact that “true learning comes with practical experience since there is greater depth.” So why waste time memorizing theory when you can procrastinate on Facebook talking to people and building connections that will probably give you a better chance at getting a job.
We are trapped in a nightmare made popular by Michael Spence. My visceral reaction to the type of behavior that stems from the above comment is to play tit for tat with such students. It's funny how they can get the better of you. Coming into the semester my goal was to inspire the students by having the class read about and discuss interesting stuff. Now I simply want to get even. And I wonder if it's just me or if this is how every instructor feels after a while from these sort of interactions.

The student who made that comment doesn't come to class. I don't track attendance officially but I do become familiar with the faces that do show up. (And I learned what he looked like when his team made an in-class presentation.) It is their call. Interestingly for me, there are more absences in the behavioral class, which has mainly Econ majors, than in the intermediate micro class, which has mainly Business students. Those Business students have it in their heads to come to class and for many of them also have it drilled in to sit up front. Their diligence is perceptible and reliable even as their penetration into the economics is sometimes wanting. Witnessing that I wonder do they represent the norm in students we should be striving for?

I wish I knew.


Cole Camplese said...

Response to Lanny

I found this student's quote really interesting on a few levels ...

"To sum up, I think procrastination is highly useful in college due to the fact that “true learning comes with practical experience since there is greater depth.” So why waste time memorizing theory when you can procrastinate on Facebook talking to people and building connections that will probably give you a better chance at getting a job."

I have to say that there is a small part of me that agrees, just not in the "stick it to the man" way that this student expresses his thoughts.  I wonder though if the student really sees procrastination in the same way we do. He clearly doesn't see spending time in a social network as something negative, in fact he is actually relatively thoughtful (yet equally relatively misguided) in his recognition of the power of the social network as the place to build connections -- sounds a lot like my high school friends who went to elite private schools, "you know, for the connections."

I was a Psychology major as an unrgrad and didn't spend time around the Business School so I don't know if this is typical to that type of student. I remember being both very passionate and a little lazy when it came to doing my own work. I really wanted to learn and be an active student, but I also wanted to do a whole lot of other things. I procrastinated, but that didn't mean I didn't want to learn. I was very immature in my world view and it sounds like these students have a heavy dose of that as well. I didn't spend a whole hell of a lot of time reflecting on my own behavior and thinking -- I was right and justified in my own mind. I am different now and continue to reflect more and more each day. 

I don't teach undergrads anymore, but I do teach a graduate course every other year in the College of Education. Really a dream gig when you consider my 20 students are all intrinsically motivated to be pushed and push back in very productive ways. I doubt many of them were that way as undergrads. That is pure speculation though. Lanny, I wonder about this sentiment, "Coming into the semester my goal was to inspire the students by having the class read about and discuss interesting stuff. Now I simply want to get even. And I wonder if it's just me or if this is how every instructor feels after a while from these sort of interactions."

From what I do know about you I would expect that you always come into the semester wanting to inspire and push your students. In my experience, that is the approach you bring to every situation. Do you find yourself feeling like getting even in these other situations when you get the kind of snark you are seeing from some of your students? I know I find myself feeling that way in lots of interactions and I have to just walk away from that.

I also wonder if you are seeing the type of interactions that do meet your expectations of discussing interesting stuff? Again, only from my own perspective and experience for every one pain in the ass student there are ten exceptional ones who do want to be inspired and still do the reading and will participate in the interesting discussions. My bigger question is should I even care about that one when there are the ones who are still willing to go the extra mile?

The last thing I'll ask is if asking the students to blog their thinking is brining out new opportunities for them to express themselves more openly and for you to have a deeper view into these expressions? I find students sometimes have a hard time using the blank slate that open discourse offers and retreat to snark. Another link in the intellectual development chain is learning how to participate appropriately. 

At any rate, sorry for the long comment and the ridiculous number of questions in my response. 

Lanny Arvan said...

Here's an argument for why to care. It's as much about the business of Higher Ed as it is about teaching and learning.

The old model is that tuition was a small fraction of total cost, the state contributed a good chunk, and undergraduate ed was second or third fiddle at campuses like ours. You shouldn't care if this is still true.

The new model, however, is that the states will contribute less and less and that undergrad ed will start to be seen as a significant revenue source, meaning we'll continue to see hyperinflation in undergrad tuition for some time to come. After all, we're still much cheaper than private institutions.

But the switching we saw between privates and publics as the former started to get too pricey will happen again, this time between public residential and commuter schools, either 4-year institutions or community colleges.

18 year olds who go to community college and live away from mom and day can do all the stuff mentioned in this post. Why pay a lot more for attending the flagship state U?

So that's the economic argument. On the teaching and learning front, if the kids got serious that still doesn't mean they'd conform to our (my) vision of how they should participate. There is then the question is what we're providing value add for them. That we're not creating value add in many cases is kind of scary. It puts a lot of eggs into sheepskin effects. That means that if we have a year or two where the job market is cruel to new grads, we may lose the reason why these students attend.

It would be a lot easier for that if the kids got something out of the education for itself.

Of course, this argument is about our preservation, not the students. Let me make one point on that and close.

In that procrastination piece I had students read, one of the reasons folks do that is to have an excuse when they don't succeed. Another reason, perversely, is that they may not know how to deal with success if they do succeed, so want to put the breaks on that too. I don't think young kids are like that. This is a learned defense mechanism. We really should be about having students unlearn that. It should be a major purpose of general education.

So on that one, part of the reason I'm struggling in this upper level class is because we are not having students turn the corner earlier on. We need to do that, for them an for us.