Easterly at the Southerns

24 November 2011 at 12:57 pm 1 comment

| Peter Lewin |

I should also mention that Bill Easterly gave the distinguished guest lecture this year on “Does Development Economics Cause Economic Development?” I thought it was excellent — both entertaining and informative — especially for non-specialists. I hope he publishes it.

Just one instance — a story about controlled random experiments in a development context (perhaps some of you have heard this). An interesting study showed that teacher absenteeism declined when teacher attendance was monitored and rewarded (imagine that). But when the same idea was applied to health-care workers, health-care workers in the treatment group (the monitored group) declined! Apparently, as a result of being monitored, health-care workers started asking for excused absences and found out that their supervisors actually did not care one way or another. As a result excused absences increased dramatically. This illustrates the power of unintended consequences and the importance of local knowledge, and how a seemingly unobtrusive experiment actually ended up providing locals with valuable knowledge that made things worse.

Entry filed under: Corporate Governance, Former Guest Bloggers, Institutions.

Entrepreneurial Paradoxes and Simulations Rationalistic Hubris and Opportunistic Behavior

1 Comment Add your own

  • 1. Michael E. Marotta  |  26 November 2011 at 3:54 pm

    Different people comprise different organizations.

    Depending on what is meant by “heath-care workers” the professions have long enjoyed personal independence. If you have a hospital stay, read the billing! Your doctors, nurses, and attending personnel all work for different agencies. While many are actually W-2 employees of the hospital, many others are contracted in various ways.

    One reason that airline passengers suffer locked in on the runway for hours is that the crew is paid only for actual cockpit time. If they let the passengers go, they are off the clock. But that is a price they pay for independence within a seniority system.

    I have a theory that you can switch people from one side of the counter to the other and get the same outcome. School teachers are just older school children, or they would not be in school. So, grades matter.

    As computer programmers are largely paid well as a baseline of rewards, for them other motivators are important. Chief among those may be the Maslovian need for actualization expressed as “doing it right.” Programmers bail out of a project or company that is not trying to be really cool and leading edge. You don’t get that among accountants or police officers.

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