Economies of Education - 10 journal articles review summary
ТEME, г. XLIII, бр. 1, јануар март 2019, стр. 155173
Прегледни рад https://doi.org/10.22190/TEME190110014D
Примљено: 10. 1. 2019. UDK 364.2:37]:330
Ревидирана верзија: 15. 3. 2019.
Одобрено за штампу: 28. 3. 2019.
ECONOMICS OF EDUCATION REVISITED – NEW
INSIGHTS FROM IDENTITY AND BEHAVIORAL
ECONOMICS
Marija Džunić * , Nataša Golubović
University of Niš, Faculty of Economics, Niš, Serbia * marija_dzunic@ni.ac.rs
Abstract
This paper reviews the economic literature on education along with the attempts
to integrate sociological and psychological views of education into standard economic
models. The analysis points to the key concepts from sociology and behavioral
economics that are translated into inputs to economic models of education, in order to
improve the understanding of the economists’ fundamental concern – resource
allocation. By extending economic models that capture the relation between investing
efforts and expected returns to education, insights from identity economics and
behavioral economics shed light to the following question: when and under what
circumstances are investments in education effective? Identity economics implies that
educational efforts are not perfect determinants of the economic returns to education,
taking into account that investments in education are determined by students’ social
norms, ideals and identities. Behavioral economics focuses on behavioral biases that
affect the individuals’ decisions on investing efforts in education and consequently,
their long-term welfare. This novel framework contributes to education research by
specifying policy interventions that could mitigate identified behavioral barriers that
constrain decision making concerning educational pathways.
Key words: education, human capital, identity, identity economics, behavioral
economics.
ПРЕИСПИТИВАЊЕ ЕКОНОМСКЕ ТЕОРИЈЕ
ОБРАЗОВАЊА – УВИДИ ИЗ ЕКОНОМИЈЕ
ИДЕНТИТЕТА И БИХЕВИОРАЛНЕ ЕКОНОМИЈЕ
Апстракт
Рад представља преглед економске литературе о образовању, као и покушаја
да се у стандардне економске моделе интегришу социолошка и психолошка
схватања образовања. Анализа је усмерена на кључне концепте из социологије и
бихевиоралне економије, који се преводе у улазне параметре економских модела
образовања, како би се суштински економски проблем – проблем алокације
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ресурса у области образовања – подробније сагледао. Проширењем економских
модела који испитују однос између улагања у образовање и очекиваних приноса
од образовања, увиди из економије идентитета и бихевиоралне економије расвет-
љавају одговоре на питања када и под којим условима инвестирање у образовање
постаје исплативо. Економија идентитета указује на то да улагање напора у обра-
зовање није у савршено сразмерном односу са приносима од образовања с обзи-
ром на то да су одлуке о улагању у образовање условљене друштвеним нормама,
идеалима и идентитетима појединаца. Бихевиорална економија усмерена је на
истраживање пристрасности и баријера у понашању које утичу на одлуке
појединаца у вези са улагањем у образовање, а последично на њихово благостање
у дугом року. Овај иновативни приступ доприноси научним истраживањима обра-
зовања осмишљавањем мера образовне политике и интервенција које би могле да
ублаже постојеће баријере у понашању појединаца које ометају процес одлучи-
вања о образовању.
Кључне речи: образовање, људски капитал, идентитет, бихевиорална економија.
INTRODUCTION
Since the seminal work of Theodore Schulz (1960) and Gary Becker
(1964), the economic research of education has predominantly been based
on the human capital theory. The traditional view of educational attainment
considers education as the main element of human capital, implying that
the most important research subject in the economics of education is the
relation between resource investments and returns to education. Human
capital theory indicates that individuals choose the amount of resources
(time, effort, money) to be invested in education, based on the expected
returns on education – increased cognitive skills, productivity and
consequently, future income. Economic models explain the allocation of
resources in education, based on the decisions of rational individuals,
weighting the costs and benefits of additional investments in education.
Economic analysis has played an important role in the research on
education, and economic concepts have for decades been corner stones for
designing and evaluating education policies. The theory of human capital
has provided important insights for the analysis of macroeconomic aspects
of education - the relation between education and economic growth,
explanation of labor market tendencies as well as exploring the effects of
investing financial resources in the public education.
However, in recent years, we have witnessed the increasing
dissatisfaction with the contributions of economics of education from the
education researchers belonging to other disciplines. The criticism is
basically directed at the restrictive assumptions that economic models are
built on. The main assumption of economic models of education is the
individuals’ unbounded rationality that refers to their ability to perform
complex calculations, based on perfect information regarding all relevant
alternatives, taking into account the expected utility of the possible
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outcomes. This makes economic theories of education divert from reality
and neglect possible sociological, political and psychological elements that
affect the behavior of rational individuals concerning education.
This paper reviews some insights from several areas of education
research that cut across disciplinary boundaries with economic theory. A
sociological view of education and its integration into economic models
is offered within identity economics - the discipline that integrates key
sociological concepts, such as social categories, ideals and identities into
the education utility functions of individuals. This line of thought
incorporates the sociological view of the students as primary decision
makers and schools/universities as the social institutions that determine
the effectiveness of resources invested in education. On the other hand,
extending economic models of education with psychological knowledge
about human behavior falls within the field of behavioral economics. As student decision making is prone to various behavioral biases, behavioral
economics contributes to the understanding of education related decision
making by creating more realistic models and explaining the patterns of
deviations from rational behavior.
The aim of the paper is to draw attention to the alternative views of
the issues of investments in education. The review of the economic
literature on education, along with the new insights from borderline
disciplines, points to the importance of multidisciplinary research on
education, in the sense of broadening the existing economic theories of
education. Extending economic models of education by incorporating
sociological and behavioral perspectives does not question the basic
assumption that investing resources improves educational attainment.
These new insights offer explanations not provided or partially explained
by economic models, regarding the circumstances under which the
investment of resources in education will be effective.
THE THEORY OF HUMAN CAPITAL
Economic theory of education focuses on the link between the
resources invested into education and the education outcomes. Classic
economic models imply that students, as rational individuals, balance the
efforts invested in education (in terms of opportunity cost) with its
discounted returns. This implies that the education outcomes, mainly in
terms of earnings, are determined by the resources devoted to education.
The notion of human capital has first appeared in the writings of
classical economists, and has also been present in the work of a number
of prominent economists prior to 1950’s (Kiker, 1966). Adam Smith has
considered the knowledge and the skills embodied in the employees to be
a part of the total amount of the capital available in the economy. By the
early XX century, similar considerations have appeared sporadically in
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the economic literature (von Thunen, 1875; Fisher, 1906). In essence,
from the perspective of economic theory, knowledge and skills embodied
in the individuals affect their productivity levels and consequently, their
earnings. Therefore, education is considered to be an investment, rather
than the expenditure, affecting not only individuals’ well-being, but also
determining the economic growth of a country (Tan, 2014).
Human capital has formally been introduced into economic literature
by the neoclassical economists, within the analytical framework of
methodological individualism. According to the rational choice theory,
individuals invest in education in order to maximize their economic
interests. The investments in acquiring knowledge and skills that increase
their productivity are realized until the private benefits of such investments
(higher income in the future) equal the private costs, implying that the stock
of human capital is formed as the consequence of the rational individuals’
decisions. The early studies of human capital, therefore, regard education as
the key component of the human capital. Deliberate investments in human
capital have been defined as the determinants of the personal income
distribution (Mincer, 1958). Johnson (1960) argued that employees do not
become capitalists due to the diffusion of ownership through share capital,
but as a result of acquiring knowledge and skills that have economic value.
Those employees that have more high-quality skills and knowledge can
demand higher wages. In other words, their knowledge and skills allow one
hour of their labour to be worth more on the market than the labour of those
who do not possess such knowledge and skills.
The explicit treatment of human resources as a form of capital, a
factor that can be produced and a result of investment, in the theoretical
work of Schultz (1961), directly contradicts the classical understanding of
labour as the ability to perform physical job requiring little knowledge
and skills, which are relatively uniform among workers. Treating education
as an investment into an individual, Schultz proposed the term human capital. This way, the human capital concept has been transformed from a
mere metaphor to a viable research subject in economic science and the
main framework for creating education policies. From this time on, human
capital has been put in the forefront of economic debates aimed at
determining the residual – the unknown or unmeasured determinants in the models of economic growth.
After the publication of Robert Solow’s article A Contribution to the
Theory of Economic Growth (Sollow, 1956), an increasing number of empirical studies based on the aggregate production function (Barro, 1991)
tried to ascribe the differences in income per capita among countries to the
accumulation of physical capital, human capital and productivity. These
studies have confirmed that higher levels of human capital fuel economic
growth (Mankiw, Romer & Weil, 1992; Barro, 1997; Krueger & Lindhal,
2001). There are two approaches that link human capital and economic
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growth. The first one explores the connection between the rate of economic
growth and the rate of human capital accumulation (Lucas 1988). The
second connects the rate of economic growth with the available amount of
human capital (Aghion & Howitt, 1998). Most of the empirical analyses
that dealt with the link between human capital and economic growth were
largely focused on education, while health, as another component of human
capital, has been devoted less attention.
According to Gary Becker (1964), human capital is the value added
that brings benefits to an enterprise or individual in the process of
production and exchange, operationalized and expressed through education,
training and work experience. Investing in human capital by the employee
benefits not only the companies, but also the employees themselves. Such
investment increases the value of the labour, and part of this increased
value can be attributed to the employee through higher wages and various
benefits, which are above the existential minimum. Based on the model of
individual optimization, Becker has developed a general theory of
investment in human agents. According to this model, human capital is
directly included in the production function, increasing worker’s
productivity.
Introducing the concept of human capital has initiated a vast amount
of empirical research of the relation between the resources invested in
education and education outcomes. A number of empirical studies have
explored the effects of education expenditures, teacher efforts, parent
involvement and teacher-student ratios on the returns to education (Card &
Krueger, 1992; Hoxby, 2000; Chetty, Friedman, & Rockoff, 2014; Jackson,
Rockoff, & Staiger, 2014). There is recent evidence on a rather large rate of
returns to education in terms of life-time earnings (Heckman, Lochner, &
Todd, 2006; Bhuller, Mogstad & Salvanes, 2017). On the other hand, the
accumulation of human capital causes significant externalities, especially in
the field of technology and innovation, indicating that social returns to
human capital outperform private yields. Education is linked to better
health of the population, the transmission of cultural values, political
participation, and the reduction of crime rates (Lochner, 2011). These
externalities are often the main reason for state subsidies in the field of
education.
IDENTITY ECONOMICS AND EDUCATION
Economic literature on education focuses solely on the balance
between the resources invested in education and its discounted returns,
without accounting for social interactions that shape educational outcomes
and determine the effects of resources on the returns to education. This is
the reason why economic models often cannot explain the variations in
educational outcomes that result from the similar amounts of invested
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resources. Fresh insights for the economic research of schooling and
education were offered within the framework of identity economics – a line
of thought that introduces key sociological concepts into economic models
of education. Traditional sociological theories explain the notion of identity as something that allows for a unified experience of oneself as the same
over time (Erikson, 1992). According to Beck (2000), Bauman (2000) and
Giddens (1991), identity represents a concept necessary for a deeper
understanding of modern societies. They argue that modern culture does
not provide ready-made identities, as was the case in pre-modern societies.
Therefore, creating and re-making of self-identity becomes an exclusive job
of the individual.
Identity economics can be briefly described as an attempt of
broadening economic science by incorporating the concept of identity into
economic models. The foundations of this discipline lie in seminal work
of George Akerlof and Rachel Kranton (Akerlof & Kranton, 2000; 2002;
2005). The core idea of this line of research is that social norms affect
agents’ economic decisions and behavior (Austen-Smith & Fryer, 2005;
Bénabou & Tirole, 2011). Namely, traditional economic explanations
deal with rational agent’ preferences and their utility functions, without
explicating the origin or configuration of such preferences. Identity
economics suggests that individuals tend to place themselves into certain
social categories. Each social category is defined by prevailing norms or ideals, determining desired behavior within that category. Individuals
experience gains when conforming with those norms and ideals, or losses
that derive from the non-conformance. That is how membership in social
groups affects individuals’ preferences – individuals face losses if their
behavior deviates from the group’s norms.
As agents’ preferences are determined by their identities, the utility
functions are broadened by preferences specific for agents’ social
categories, besides universal and norm-independent preferences, such as
wealth maximization (Akerlof & Kranton, 2010). Identity economics
enables the analysis of economic outcomes by considering not only
pecuniary incentives, but also identities as primary motivations (Kranton,
2016). This framework refines the understanding of the utility function,
explaining the utility that individuals pursue as dependent on their
identity. Consequently, the choice of identity is regarded as potentially
most important economic decision that an individual would ever make
(Akerlof & Kranton, 2010).
Identity creates a specific type of externalities, since the status of
the group an individual belongs to is endogenous – it is affected by the
behavior of the individuals that identify with it. Individuals’ actions
therefore change the group’s stereotypes (Akerlof & Kranton, 2002).
The model of utility enriched with social differences and norms
can be applied in many different settings. Such models can be used in
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explaining work efficiency affected by the workgroup identity (Akerlof &
Kranton, 2008) or gender and race discrimination in work organizations
(Akerlof & Kranton, 2010). A specific model includes the identity into the
education utility function (Akerlof & Kranton, 2002). This model implies that educational efforts are not perfect determinants of the economic returns
to education. In other words, more abundant school resources are not
robustly associated with superior educational outcomes. Students’ utility
function does include costs of making an effort and returns on education in
terms of future income based on the effort, but it also includes their
identity. This implies that the students derive their motivation from the
social setting of the school as a social institution and from the extent to
which their personal norms and ideals adhere to the school ideals (Koch,
Nafciger, & Nielsen, 2015). Identities are determined by the social
categories the students choose based on the level to which their personal
norms and values conform to the norms and values of the social category.
When chosen, the social category determines the student’s behavior as he
or she tries to conform to the ideal characteristics promoted by that
category.
The students’ decision on the level of educational effort is thereby
determined by the ideals of their group and the level of effort that is
considered to be acceptable within the group. This way, the efforts are not
chosen strictly under the assumption of rational choice, but the decision
on investing the efforts in education is dependent on the students’
identity. Consequently, this will affect their school performance. For
example, conforming to the norms of a social category that nurtures a
defiant attitude towards school authorities will affect the relation between
students and teachers, leading to students’ lower commitment to school
obligations and worsening their school performance (Reyes, Brackett,
Rivers, White, & Salovey, 2012). In other words, if the prescribed norms
of the student’s social category differ from the norms of the school (ideal
school effort), students will suffer identity loss and underinvest in human
capital. In order to preserve their self-image, the students reject the school
mission and underinvest in education.
High schools represent the typical social setting where students tend
to distinct themselves by identifying with specific groups, according to
their norms and ideals concerning dress code, gender, race or educational
expectations. Students choose their social identities and define themselves
and relationships with other students. This way, students that adhere to
groups that align with the mission of the school may achieve solid
performance. On the other hand, students identifying with an outside
mentality will turn to underperformance as their ideal effort. The problem
arises when schools promote a single ideal type of student among students
from a number of different social backgrounds (Contreras, Elacqua,
Martinez, & Miranda, 2016). In such cases, it is advised that schools
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promote more than one ideal, so that a number of student groups (social
categories) can find a way to identify with the school norms and find
motivation for improving their performance (Akerlof & Kranton, 2002).
The schools should “build” more than one identity, through investing
resources into creating communities within the school that would promote
school norms. Promoting more than one ideal makes schools more
inclusive and serves the purpose of accommodating various students’
backgrounds. However, this collides with the schools’ attempts to promote
particular skills, favoring certain social groups. Therefore, the schools often
face trade-offs between creating an inclusive identity, that will conform to
many different students’ backgrounds and investing into developing
particular skills.
Basically, the implications of the identity theory of education can be
summarized in the following way: increasing resources in education may
be ineffective, if students’ backgrounds do not allow them to identify with
the academic values that schools promote. This view does not diminish the
importance of resources (high quality teaching, for example), quite the
contrary. However, the sociological perspective highlights the fact that
student achievement is to a certain extent dependent on the gap between
their self-images and persons the school wants them to be (Akerlof &
Kranton, 2002). So the main question does not refer to whether resources
improve educational outcomes, but to explain why and when these
resources are effective. This represents the rationale to create appropriate
education policy measures whose main aim is to promote identities that are
in line with the mission of improving educational outcomes. The main
contribution of identity economics to the research of education is the
theoretical model of the optimal ideal the schools should promote and the optimal amount of resources that schools should invest in creating school
identities, depending on the extent of student population diversity.
BEHAVIORAL ECONOMICS OF EDUCATION
Taking into account that the decisions about educational pathways are
made in the early stages of individuals’ lives, there is a significant probability
of individuals making poor decisions with long-run consequences. These
once-in-a-lifetime choices are by rule particularly difficult to make, which is
why individuals tend to be bad at making them (Benartzi & Thaler, 2007). A
prominent field of social science research, behavioral economics, is investing
growing efforts to explain behavioral barriers in long-run decision making in
order to better predict individual outcomes (DellaVigna, 2009). Behavioral
economics, integrating insights from psychology, neuroscience and sociology
into economic models, is finding its way into the research of education, by
exploring why the young and their parents make suboptimal decisions
regarding education opportunities. In other words, since it is obvious that
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education improves a number of individual outcomes, it is puzzling how
individuals invest too little efforts in education (Steel, 2007), or why drop-out
rates are increasing (Bridgeland, Dilulio & Burke Morison, 2006).
Behavioral science therefore extends the economics models of education,
integrating behavioral factors that determine the students’ decisions on
investing efforts in education and consequently, their long-term welfare. This
approach ensures a better understanding of the complexity of the relation
between educational efforts and outcomes. The results of research in this
emerging field are expected in the domain of developing policies that could
mitigate such barriers. In the following sections we provide a brief overview
of behavioral economics of education and then we point to the possible
interventions aimed at improving individual decision-making in the field of
education.
Behavioral barriers to education
The specificity of decision-making regarding education reflects in
the fact that decisions on educational investments are made in stages of life
when decision-makers have not yet reached the desired level of maturity
and are therefore exposed to a scope of behavioral and psychological
factors that affect their education decisions (Jabbar, 2011; Koch, Nafciger,
& Nielsen, 2015). As human capital theory indicates, individuals make
decisions on further education steps at each stage of education, based on the
comparison of the costs of education (time, money, effort) and the benefits
deriving from it (knowledge, skills, prospects for higher earnings). The
literature from behavioral economics implies that students, parents and
teachers are affected by behavioral barriers when making educational
decisions (Lavecchia, Lui & Oreopoulos, 2016).
The concepts explored in behavioral economics relate to the so-
called soft skills, which have recently begun to be considered equally
important for educational outcomes as cognitive skills (Koch, Nafciger, &
Nielsen, 2015). Standard economic models of education have until recently
focused on how educational efforts improve individual outcomes mostly
through enhancing students’ cognitive skills (Arcidiacono, Bayer, & Hizmo,
2010). In the standard model of educational production function (Todd &
Wolpin, 2003), student achievement in terms of test scores is determined by
students cognitive skills and abilities, in addition to family, school and peer
inputs. Soft skills cannot be measured by test scores and they refer to
personality traits, beliefs and preferences (Eckstein & Wolpin, 1999;
Oreopoulos, 2007; Heckman & Kautz, 2012). Behavioral economics of
education focuses on exploring soft skills and their impact on the relation
between educational investments and outcomes. It enriches the standard
economic theory of education, by adding more realistic assumptions on
human behavior, emphasizing non-standard preferences and non-standard
beliefs that affect decision making (Camerer & Loewenstien, 2004).
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An important concept in behavioral economics that is considered to
significantly affect education-related decisions relates to time-inconsistent
preferences. Namely, decisions about investing in education are most often
accompanied by a trade-off between immediate costs (foregone earnings,
learning efforts, boredom) and vague future benefits, in the form of higher
earnings. Therefore, individuals are affected by present-biased preferences
when weighing the costs and benefits of education (Laibson, 1997). In the
absence of self-control, individuals tend to fail in aligning their present
behavior with the long-term goals which results in educational under-
achievements (Steel, 2007). For example, many empirical studies confirm
that present-biased preferences represent a significant factor of drop-out
rates (Oreopoulos, 2007; Cadena & Keys, 2015). The mechanism of such
influence is explained in the following way: adolescents facing self-control
issues often tend to underinvest efforts in studying or procrastinate on
important tasks. They also tend to put off important decisions, and are more
patient when thinking about decisions that have to be made in distant future
than when they have to make them at present. Although graduation seems
like a preferable option, these students do not have the ability to sustain
effort and resist doing more pleasant activities than attaining class, which
leads to decreasing class participation (Evans, Baker & Dee, 2016). Time
inconsistent preferences are also found to affect student grades, since
impatient students are not able to put in consistent effort and resist
distractions. It is expected that parents could compensate for the lack of
their children’s self-control, but research evidence indicates that both
parents and children with low social-economic status lack the self-control
mechanisms (Golsteyn, Grönqvist, & Lindahl, 2014).
Another form of behavioral bias exists in the form of reference-
dependent preferences (Kahneman & Tversky, 1979). According to
prospect theory, individuals behave differently when facing probable gains
opposed to probable losses. In conditions of uncertainty, individuals tend to
be risk-averse, but when a probable gain is expected, the risk aversion is
higher than in the case of probable losses. Applied to decision-making in
the area of education, this means that uncertain gains from investing in
education can affect students to underinvest in education. This theory
explains that individuals evaluate the outcomes of their decisions relative to
a certain reference point. Such reference points (for example, highest
educational achievement of the parents) affect students’ decisions about
enrolling to higher levels of education (Page, Garboua & Montmarquette,
2007). When the status-quo serves as a reference point, individuals often
prefer the status-quo as the most familiar option, even though some more
attractive options are available (Benartzi & Thaler, 2000). This default-bias
(Kahneman, Knetsch, & Thaler, 1991) can explain why some high school
graduates do not deliberately decide not to enroll into college, but fail to
enroll due to minor hurdles, such as missed deadlines (Avery & Cane,
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2004). This kind of bias is more pronounced within the social groups of
lower socio-economic status, since enrolling to college is not the default
option for them.
Paradox of choice is another concept explained in the behavioral economics as a barrier in decision making. First, unlike economic theory
assumes, individuals are not in disposal of perfect information about the
returns to education (Oreopoulos & Dunn, 2013), nor are they equally
capable of processing all relevant information in order to make an
informed decision. Cognitive abilities and attentional limitations affect
individuals’ decision making (DellaVigna, 2009). Furthermore, when
faced with a large set of options, individuals often tend not to make any
kind of decision, meaning that complexity of information causes poor
decision making (Hastings, Van Weelden, & Weinstein, 2007). In such
situations, decision makers tend to overestimate the most salient aspects
or information. For example, as educational cost in terms of tuition fees
are clearly observable before the enrollment, opposed to benefits in
distant future, prospective students may make a decision based only on
the available information.
Behavioral economics points to the importance of non-standard beliefs as barriers to sound decision making. Most of these beliefs relate to
individuals’ own abilities, in the sense that people tend to be overconfident
when their abilities are concerned (Bénabou & Tirole, 2002). Although it is
expected that self-confidence can serve as an important determinant of
intrinsic motivation, it is not clear whether overconfidence in one’s abilities
can have a positive effect on educational efforts. For example, if ability and
effort are complementary, positive view on abilities can have strong
motivational effects on effort. Self-confident students may believe that their
efforts will be productive, so they engage in studying with more effort
(Chen and Schildberg-Hörisch, 2018). In different settings, when ability
and effort are substitutes, overconfident students tend to invest less effort,
falsely believing that their ability can substitute for low effort. Empirical
studies indicate that small initial differences in self-confidence account for
significant variations in human capital accumulation (Filippin and
Paccagnella, 2012). The importance of self-confidence in behavioral
economics research stems from the fact that it represents the main source of
individuals’ intrinsic motivation and internal drives. However, when
combined with various forms of extrinsic motivation (monetary or non-
monetary rewards, grades and ranking), it can produce mixed results on
educational efforts and achievements. Namely, intensifying external
incentives for the individuals that are already intrinsically motivated can
crowd-out intrinsic drive (Ariely, 2009).
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Behavioral economics and interventions in education policy
The review of behavioral economics concepts that are likely to
advance our understanding of educational issues has some important
implications for education policy. Introducing psychological aspects of
human behavior in education research, behavioral economics starts from
more realistic assumptions about human behavior, so the policies based on
behavioral economics insights may be more successful in inducing the
desired educational outcomes (Jabbar, 2011). As understanding of behavioral
mechanisms in place is crucial for a deeper understanding of the complexity
of decision-making related to education, experimental studies and empirical
evidence provided by this field helps to identify the areas where educational
interventions can be successful. For example, educational interventions based
on behavioral economics can be designed to affect self-control issues,
simplify choice options or reduce the status-quo bias (Lavecchia, Liu &
Oreopoulos, 2016). Educational policies, in order to be effective, need to be
targeted depending on the particular behavioral barriers affecting individuals’
educational decisions (Damgaard, & Nielsen, 2018).
The basic policy tool suggested by the behavioral economics mostly
relates to gently pushing the individuals in the desired direction without
imposing explicit limitations – the so-called nudging (Thaler & Sunstein,
2008). In the area of education policy, this would mean nudging students
and their parents toward better decision making concerning education,
based on understanding specific behavioral barriers in place. The types of
nudging interventions in education depend on: 1) whether they affect active
or passive decision making, and 2) whether they are aimed at changing the
decision environment or making additions to it. The main differences along
these two dimensions are the following ones: an active decision making
requires well informed, skilled and motivated individuals, whereas it is not
needed for the passive decision making. Also, interventions aimed at
changing decision environment are aimed at removing limitations that
inhibit the desired behavior, while additions to the decision environment
are aimed at compensating the missing ingredients which constrains the
desired behavior. The type of educational interventions aimed at affecting passive
decision making by changing the conditions in which the decisions are made refers to pure nudges. They include default effects (Thaler & Benartzi, 2004), aimed at changing defaults that individuals are most likely to choose (Johnson & Goldstein, 2003); framing interventions, that represent small changes in decision environment, such as presenting different aspects of already available information (Benhassine, Devoto, Duflo, Dupas, & Pouliquen, 2015) or gain/loss prospects (Levitt, List, Neckermann, & Sadoff, 2016); and peer group manipulations, that facilitate peer interaction in order to create a sense of social belonging or group identities (Carrell, Fullerton & West, 2009). A number of nudging interventions aimed at
167
passive decision making uses small additions in the decision environment in terms of adding information that could potentially alter the students’ behavior, by improving their self-confidence or self-images, consequently inducing better educational outcomes. For example, they include creating a sense of social belonging (Walton & Cohen, 2011), building identities (Chande et al., 2015) or the so-called mindset interventions, that explain the students that their ability to learn is not fixed but malleable (Yeager et al., 2016).
The other line of nudging interventions is aimed at influencing active decision making, by adding information, capacity or skills necessary for making decisions about education. These interventions are effective in situations when parents or students are missing important information, although it is publicly available, about child behavior, efforts or attendance (Rogers & Feller, 2016), returns to schooling (Fryer, 2016) or financial aid (Hoxby & Turner, 2015). Providing basic assistance to individuals with attention or cognitive limitations (for filling forms or college applications) is also found to induce better educational outcomes (Oreopoulos and Ford, 2016). Finally, individuals with self-control problems may benefit from nudging interventions that boost their skills, that would enable them to mitigate the behavioral barriers, such as forward-looking or goal setting skills (De Paola and Scoppa, 2015). The effectiveness of each of these interventions is dependent on whether it is targeting the particular constraining factor for making a decision.
CONCLUSION
This paper provides an overview of interdisciplinary research on
education, meant to explain the black box of educational issues, by extending economic research on education in new directions. It aims to
draw attention to the concepts from neighboring social disciplines that
could shed a new light on the education research and suggest directions for
further research. The insights from identity and behavioral economics
challenge conventional economic reasoning, broadening the economic
models by introducing norms, social differences and mechanisms of human
behavior.
Identity economics offers an insightful framework that synthesizes
economic and sociological views in the attempt to determine how to
effectively deploy resources in education. This line of research enriches
the economic models with social differences and norms, and implies that
investing additional resources in education may be ineffective if student’s
social norms do not allow them to identify with the school values.
Education policy implications that can be derived from this research
relate to the need for promoting identities that are aligned with the ideal
of improving educational outcomes. Resources invested for this purpose
are a function of student population diversity.
168
Behavioral economics contributes to the research on education by
focusing on the behavioral barriers that students as decision makers are
exposed to. Starting from realistic assumptions on human behavior,
insights from behavioral economics complement economic models in
order to enhance our understanding of behavioral responses that affect
long-run educational decisions. The amount of resources invested in
education falls within the non-standard decision making, which adds to
the complexity of educational decisions. Behavioral economics offers a
wide range of policy interventions, targeted at the particular behavioral
barriers that constrain individual decision making.
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ПРЕИСПИТИВАЊЕ ЕКОНОМСКЕ ТЕОРИЈЕ
ОБРАЗОВАЊА – УВИДИ ИЗ ЕКОНОМИЈЕ
ИДЕНТИТЕТА И БИХЕВИОРАЛНЕ ЕКОНОМИЈЕ
Марија Џунић, Наташа Голубовић
Универзитет у Нишу, Економски факултет, Ниш, Србија
Резиме
Образовању као истраживачкој теми у оквиру економске науке углавном се приступа са аспекта теорије људског капитала, која имплицира да појединци одлуке о томе колико ће ресурса (времена, напора, новца) уложити у образовање доносе на основу очекиваних приноса од образовања. Међутим, овакав приступ занемарује могуће утицаје социолошких, политичких и психолошких фактора на одлуке рационалних појединаца у вези са образовањем. Рад представља преглед новијих увида, проистеклих из истраживања образовања у оквиру других дисци- плина, а која се простиру дуж интердисциплинарних граница са економском теори- јом. Ови увиди нуде разјашњења околности под којима улагање ресурса у образо- вање може бити исплативо, а која постојећи економски модели не пружају или са- мо делимично објашњавају.
Социолошко схватање образовања и његово укључивање у економске моделе приказани су у оквиру економије идентитета – дисциплине која кључне соци-
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олошке концепте, попут друштвених категорија, идеала и идентитета, укључује у индивидуалне функције корисности од образовања. Економија идентитета укључу- је социолошку перспективу, која студенте сагледава као примарне доносиоце одлука, а школе и универзитете као друштвене институције које утичу на ефика- сност инвестирања ресурса у образовање. Овакав концептуални оквир омогућава презицније дефинисање функције корисности, указујући на то да је корисност коју појединци остварују, између осталог, функција њиховог идентитета. Идентитети су одређени друштвеним категоријама за које се студенти опредељују на основу тога у којој су мери њихове вредности и норме усклађене са нормама и вредностима друштвене категорије. Након избора друштвене категорије, понашање појединаца одређено је припадношћу друштвеној категорији, у смислу да појединци усклађују своје понашање са идеалима које дата категорија охрабрује. Растућа улагања у образовање могу да буду неефикасна уколико појединци због свог друштвеног порекла не могу да се идентификују са академским вредностима које промовишу школе. Кључни допринос економије идентитета истраживању образовања пред- ставља теоријски модел којим се утврђује које идеале школе треба да промовишу, као и оптимална количина ресурса које школе треба да инвестирају у стварање школских идентитета, у зависности од степена диверзификације студентске попу- лације.
Са друге стране, проширење економских модела увидима из психологије који се тичу људског понашања спада у домен бихевиоралне економије. Како доношење одлука у вези са образовањем подлеже различитим пристрасностима којима су појединци изложени, бихевиорална економија доприноси потпунијем разумевању начина на који се доносе одлуке у вези са образовањем тако што ствара реали- стичне моделе понашања и објашњава обрасце одступања од рационалног понаша- ња. Бихевиорална економија образовања усмерена је на истраживање личних осо- бина и вештина (тзв. soft-skills) и њиховог утицаја на однос између улагања у обра- зовање и образовних исхода. Овај приступ обогаћује стандардну економску теорију образовања тако што полази од реалних претпоставки о људском понашању, нагла- шавајући нестандардне преференције и уверења која утичу на доношење одлука. Основна мера образовне политике коју сугерише бихевиорална економија односи се на благо усмеравање појединаца у жељеном правцу, без успостављања експли- цитних ограничења – тзв. гуркање (nudge). Типови оваквих интервенција у образо- вању разликују се у зависности од тога да ли утичу на активно или пасивно одлучи- вање, као и од тога да ли су усмерени на измену окружења у коме се доносе одлуке или на његову допуну. Ефективност оваквих интервенција зависи од тога да ли су усмерене на конкретан ограничавајући фактор рационалног одлучивања.
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