Friday, October 24, 2014

Experience with the Psychology and Economics of Team Production and Gift Exchange

The New York Times article, "How to Get the Rich to Share the Marbles," given in the prompt for this post makes an interesting and very legitimate comparison between man's psychological willingness/non-willingness to share and the current direction of the Democratic party. The behavior of the toddlers in Tomasello and Hamann's experiment seemed quite similar to the consensus behavior of many Americans when it comes to their roles in the American economic structure.When participants are aware of the source of the payout, the dividing up of payouts is usually based on whose input led to what payout as opposed to being based on who gave the biggest input. This system seems to make sense as far as distributive fairness. You've heard the saying, "work smarter, not harder." If one person's effort led to a much bigger payout than another's, why should the first person have to share the wealth they received? This is the problem that Democrats want to alleviate. What will increase the wealthy's willingness to share with their less wealthy counterparts? One idea might be if the wealthy's payout is dependent on their sharing with the less wealthy. I have a example.

I took a class on Financial Management a couple of semesters ago. Part of the curriculum involved a group project in which we analyzed the stock market on a weekly basis, decided on stocks to "buy" or "sell," and reported our findings. After a semester of buying and selling stocks, we had to write a paper as a group, describing various aspects of the projects and our findings. We originally broke this paper up into even parts, so that everyone would provide the same input. However, as the process went on, small chunks of other members' work fell onto the shoulders of myself and one other member. In addition to helping the other members with their chunks, the two of us had to review and edit their work and get the paper formatted for submission. Essentially, the assignment became largely the product of the two of us with small inputs from the other members. Why would we be willing to gift the other members  by helping them out with their chunks? Of course, it was because the group as a whole received a single grade. Helping our group members led to us receiving a higher grade.

This could translate over to Haidt's idea in his article. Since the payout for the two of us who were doing most of the work hinged on the performance of the group as a whole, we were willing to gift our other group members with increased production. If we were each graded individually (assuming the professor could determine how hard we each worked), the two of us would have no incentive to help our group mates out.

This idea sounds feasible considering everyone benefits in the situation. The two of us still received a good grade and so did the rest of our group, but is that fair?  That's hard to say. On one hand, those whose work leads to positive payouts should be rewarded accordingly. However, was is necessarily the fault of our group mates that their work may not have led to such positive payouts? If they truly worked hard on their section of the project, but struggled in some way, should they be punished by receiving a lower grade than other group members who produced more? In theory, one would almost certainly say no. However, if we were to distribute payouts based on effort alone, how would effort be quantified?, i.e. what would stop members from only demonstrating perceived effort in order to receive a payout? This seems to be the critique of choice for Republicans opposed to the liberal agenda of the Democrats. If everyone works hard, then equal payouts is feasible, but if some slack because their production doesn't affect their pay, that could lead to real problems.

The only part of Haidt's piece that doesn't seem to connect with my experience is the final paragraph, regarding the rich lobbying in Washington to help themselves become richer. In my experience, there wasn't a way for any of us to lobby with the professor to give us an edge in grading. This might be an aspect in favor of equal pay for all or effort-based payouts. If everyone received the same payouts, no single person would have any more utility than another, which would effectively cancel out the ability to lobby and the edge gained from lobbying.

2 comments:

  1. In class situations, sometimes group size is not well considered. If two of you could do the entire project, why have a group with more members?

    When I was in eighth grade French class, the teacher reseated us after the first exam so that the seating was ordered by exam performance and the best student sat next to the worst student, the next best student to the next worst, etc. There were no project, but on ordinary coursework the idea was for the better student to help out the struggling student. This was during regular class time, so if the help did happen that way then it really wasn't subtracting from something else the better student might do.

    In the one-on-one situation described above, I think Haidt would conclude the better student would willingly help if the struggling student appeared to be trying, but not otherwise. With that there is a question of whether the performance can be mis-identified and then both ways. The poorer student actually is trying but is taken as a shirker (first way) or the poorer student is not putting in effort but is given credit for trying (second way). As a teacher, I'm sure I make both sorts of errors from time to time.

    In the past, I have given team grades like what you describe. I've also tried hard to do so with a mechanism that encourage each student would have to pull their own weight, because when I was doing this it was with regular problem sets where the answers to a problem could be revised but at first each member of the team had to submit their own problem. It wasn't foolproof but it did get at least some participation from all the team members.

    On the politics in that piece, note that it is from a few years ago and is not really about the current election. I would say current politics is based more on the question of whether the poor are pulling the rope all and, if not, is that because they are unable to do so or unwilling but capable. The issue that I would have thought Occupy would bring to the fore - the lower tax rate on capital gains than on earned income - doesn't seem to be an issue in this election, as near as I can tell.

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    1. It's hard to say why the group for the project in my example was so large. It may have been for ease of the teacher (keeping up with 5 groups as opposed to roughly 15 or so), or so that we could learn to better work in teams and make things easier on ourselves. Each week, each group member would bring an idea for a stock to buy and we would vote as a group. This allowed us to cover a wider range of stocks throughout the semester by analyzing individually and discussing collectively. As far as the paper, it could have been done by two people, but the large group allowed us to split it up. This could have been why some didn't quite pull their weight. Since it was fairly easy for us to take on another chunk of the paper, it was easy for them to push it off onto us.

      This seems to be the trouble with the economic theory as well, as you said in your comment. Determining when people are slacking on their work and when they are actually trying is difficult. This is why many (mainly on the right) favor a production-based reward program. When awarding payouts for production alone, at least no argument can be made about whether or not the working individual deserves the payout.

      Perhaps something in the middle would be the best way. Base payouts on performance, but also provide incentives to the more successful to help the less successful. It seems as though you've tried to move close to a style like this in your teaching experience.

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