School choice, and separation of church and state

As a beneficiary of both a democratic and a religious tradition, I think that separation of church and state is good not just for states (if they happen to be liberal democracies), but also for religious communities (if they aspire to be self governing). In Britain, there are state funded religious schools, so school choice issues for religious schools get resolved by secular courts: Who Is a Jew? Court Ruling in Britain Raises Question .

"Britain has nearly 7,000 publicly financed religious schools, representing Judaism as well as the Church of England, Catholicism and Islam, among others. Under a 2006 law, the schools can in busy years give preference to applicants within their own faiths, using criteria laid down by a designated religious authority. "

The case in question is wending its way through the appeals court process. But it appears that, by accepting state funding, Britain's religious communities have let the state into the church, so to speak.

Update:Dec. 15. British High Court Says Jewish School’s Ethnic-Based Admissions Policy Is Illegal
Update: January 10: Faith schools facing admissions curb

Incentives in Chicago school choice

The Chicago Sun Times reports:
"Poring over data about eighth-graders who applied to the city's elite college preps, Chicago Public Schools officials discovered an alarming pattern.
High-scoring kids were being rejected simply because of the order in which they listed their college prep preferences.
"I couldn't believe it,'' schools CEO Ron Huberman said. "It's terrible.''
CPS officials said Wednesday they have decided to let any eighth-grader who applied to a college prep for fall 2010 admission re-rank their preferences to better conform with a new selection system.
Previously, some eighth-graders were listing the most competitive college preps as their top choice, forgoing their chances of getting into other schools that would have accepted them if they had ranked those schools higher, official said.
Under the new policy, Huberman said, a computer will assign applicants to the highest-ranked school they qualify for on their list.
"It's the fairest way to do it," Huberman told the Chicago Sun-Times editorial board Wednesday."

This is the same issue that led to the redesign of the Boston school choice system.

HT Parag Pathak

update: see earlier stories on the changes in the Chicago magnet school program here and here.

Morality of buying kidneys (and brokering them)

Robby Berman, the founder and director of the Halachic Organ Donor Society (www.hods.org ), has an opinion piece in today's YNet: Buying kidneys is moral

It begins:
"I am responsible for the needless deaths of more than 100 Jews. All were victims of kidney disease, literally and figuratively dying on dialysis. They pleaded with me to introduce them to people willing to sell their kidneys, and I refused to do so because it is illegal.
If media reports are true, however, Sammy Shem-Tov and Dimitry Orenstein of Jerusalem did work as a kidney shadchanim (matchmakers) - saving hundreds of lives. Their motives weren’t pure. It took lots of money to get them to break the law and risk prison. So who acted morally and who did not? To me the answer is obvious. They are heroes even if they became wealthy in the process. "

It goes on to make some arguments related to repugnance.

School choice and school capacity

Deciding what is the capacity of a popular high school is tricky in a city that uses school choice. Here's an article from the NY Times about Francis Lewis high school in Queens, in NYC. It is way over 'capacity' because it is popular: At School in Queens, Success Draws Crowd.

(To put it another way, capacity is flexible, and so are students; some eat lunch at 9am, since the lunchroom has to be scheduled all day...)


Following the publication of the story, the Times published some letters to the editor from proud former teachers and students at Francis Lewis (including one from a famous economist).

More Milgrom

Northwestern has put up a page of material following the 2009 Erwin Plein Nemmers Prize in Economics Lecture and Conference, including Paul's slides, and a video of his lecture.

There are also links to the slides and bibliographies of the talks given on Friday (including the 10 minute presentations given by panelists; now I'm working on my 1 minute talk...)


Vijay Krishna (Pennsylvania State University): Auctions and Information[Presentation and Bibliography - PDF]

Larry Ausubel (University of Maryland): Auctions with Multiple Objects[Presentation - PDF] [Bibliography - PDF]

Panel Discussion: Market Design.Moderated by Rakesh Vohra (Northwestern University)
Susan Athey (Harvard University) [Slides]
Preston McAfee (Yahoo! Inc.) [Slides]
Paul Milgrom (Stanford University) [Slides]
Alvin Roth (Harvard University) [Slides]

Stephen Morris (Princeton University): Trade and Information[Presentation - PDF] [Bibliography - PDF]

Bengt Holmstrom (Massachusetts Institute of Technology): Agency Models[Presentation - PDF] [Bibliography - PDF]

John Roberts (Stanford University): Organizational Economics[Presentation - PDF]

And here is my previously posted unofficial conference photo.

College admissions: the costs of having too many acceptances

The Chronicle of Higher Education has a story on Ithaca College which illustrates some of the difficulties of the college admissions process from the colleges' point of view: Ithaca College Overshoots Its Admissions Mark and Pays a Price. (This link may need a subscription, so here's a longish excerpt that gives the idea...)

"In a year of unusually high uncertainty over admissions at private colleges, Ithaca College appears to have missed its target by a larger margin than most.
Now it is dealing with the financial consequences—even paying 31 students up to $10,000 each to defer their enrollment for a year—and adjusting its admissions policies and financial-aid spending plans in response.
Ithaca had aimed to enroll 1,700 to 1,750 new freshmen but found itself with an incoming class of 2,027 for this fall.
Ending up with a class that is 20 percent larger than expected is certainly better than having to operate with a class that is 20 percent under target. But "coming in heavy" with a class, as this circumstance is known in the field, can often bring its own short-term and long-term costs, and create some added financial instability.
"They have to feed that animal for four years," said George Dehne, a longtime consultant to colleges, whose firm does not count Ithaca as a client. "It looks like someone took their hands off the wheel."
The feeding includes extra spending for financial aid, for additional instructors (Ithaca had to hire several dozen), and for a new temporary residence hall, constructed in six weeks at a cost of $2.5-million."
...
"Ithaca had suffered a decline in freshman enrollment in 2008, falling 11 percent below its budgeted target of 1,600. Many of the steps it took over the past year to enroll the entering class in 2009 were designed to compensate. The steps included lowering selectivity (Ithaca accepted 73 percent of its 2009 applicants, compared with 59 percent in 2008) changing its merit-aid policy so money could be spread among more applicants, and intensifying "yield" efforts to get more admitted students to attend.
Other colleges did the same things, according to a survey released last month by the National Association for College Admissions Counseling.
But Ithaca lacked some of the levers colleges traditionally use to give themselves more control over admissions, most notably the early-decision option.
Many colleges use early decision to lock in a portion of their class early in the admissions cycle, which helps reduce some of the risks inherent in later stages of the process, when institutions decide how many students to admit outright and how many to place on the waiting list."
...
"Mr. Maguire, Ithaca's new enrollment-management chief, ... said the college is reinstating early decision, two years after dropping it. Without it, he said, Ithaca didn't have a solid picture of its admissions situation until very late in the process. Freshman deposits came in with a "huge spike at the very end of April.""


"The Cost of Too Many Freshmen
Ithaca College made several adjustments in policies and spending after enrolling 20 percent more students than it expected to this fall. These included:
Reinstituting early decision, to give the college more control over admissions earlier in the process.
Raising admissions selectivity for the fall of 2010 to reduce the admit rate.
Erecting a temporary residence hall in six weeks at a cost of $2.5-million.
Allocating up to $1.2-million in additional funds to hire nearly 50 part-time faculty members, two new full-time faculty members, and to pay 30 current full-time professors overload pay for teaching extra courses.
Providing 20-percent reductions on room charges, and paying the cable-TV bills, for students who had to be housed in lounges.
Offering admitted students up to $10,000 each to defer their enrollment for a year (Ithaca says 31 students took the offer, at a total cost of about $250,000).
Providing $2,000 in incentives to upperclassmen to move off campus. "

College admissions in the UK, update

The Times offers British students a Good University Guide, with some advice on navigating the various parts of the British college admissions process, including the scramble known as "clearing," and the difficulties of taking advantage of re-graded exams.

Act fast to snap up a place
Competition to make it to university through clearing will be more intense this year as applicants chase fewer places

Guide to Clearing: essential information on universities in the clearing system
John O’Leary outlines some of the pros and cons of 40 UK universities likely to be offering the most places through clearing this year


A-level system will not help students 'trade up'
Pupils who do better than expected in exams will miss out on places at leading universities because courses are already full.
"Those who are unfairly marked down in A-level exams could lose their place, even if they successfully appeal and later get a higher grade. Some courses are closed to British applicants even though they still have places for foreign students. This is because for financial reasons the Government restricts the number of British students that universities can recruit. Overseas students pay higher fees and do not receive the grants or subsidised loans available to home students. "


There's also a guide to the mysteries of college admissions on this side of the pond: How to get into an American university
Students are increasingly looking across the Atlantic for university – but the application system can seem daunting.

"One of the main differences between the US and here is that there is no central body that handles the admissions, as Ucas does in the UK. "


Here are my earlier posts on British college admissions:

University admissions in the UK, and University admissions in the UK: admissions formulae

Mazel tov to Methodist Hospital in San Antonio

A Methodist milestone: 50th paired donor kidney exchange transplant

"The transplant team at Methodist Specialty and Transplant Hospital performed their first exchange procedure in March 2008 and completed the 50th procedure just 19 months later, with 42 of the exchange transplants performed in just the past 10 months. "

Update: here's a link to the hospital's news release, which makes clear that they are performing all these exchanges primarily among patients in Texas: Methodist Specialty and Transplant Hospital Reaches National Milestone with 50th Paired Kidney Exchange Transplant

Competition among stock exchanges

The NY Times has a story about how New Rivals Pose Threat to New York Stock Exchange.

"While the exchange has been under assault since the beginning of the decade, its decline has accelerated in recent years as aggressive competitors have emerged. Today, 36 percent of daily trades in stocks that are listed on the New York Stock Exchange are actually executed on the exchange, down from about 75 percent nearly four years ago. The rest of are conducted elsewhere, on new electronic exchanges or through dark pools. "

..."Unlike the Big Board, the new electronic exchanges are virtually unknown outside financial circles. Direct Edge, the largest, is in Jersey City. Another, the BATS Exchange, is based in Lenexa, Kan. Both are only about five years old. But each now accounts for about a 10th of daily United States stock trading. "

I'm reminded of Estelle Cantillon's paper with Pai-Ling Yin on a battle between London and Frankfurt exchanges: Competition between Exchange: Lessons from the Battle of the Bund

Market designers at the Milgrom/Nemmers Prize conference

A multitude of market designers. Here's a photo of

Bob Wilson, Paul Milgrom; and Parag Pathak in the near background: Faces to recognize, and names to conjure with.

Here's my pre-conference post: Paul Milgrom: Nemmer's Prize Lecture and Conference

The wholesale market for iPhone Apps

Joshua Gans reports: The Wholesale App Market opens.

Fraud in online auctions

Losing Out After Winning an Online Auction

NY Times article discusses deadbeat sellers and fraudulent escrow services.

More on repugnant language

While the Federal Communication Commission continues to regard the broadcast of some words as repugnant, language scholars continue to trace how taboo terms gradually become more acceptable. (See my earlier post Fleeting expletives and wardrobe malfunctions: FCC vs Fox Television and CBS.)


Oxford University Press has just issued a new edition of The F-Word. Their blurb begins:

"We all know what frak , popularized by television's cult hit Battlestar Galactica , really means. But what about feck ? Or ferkin ? Or foul --as in FUBAR , or "Fouled Up Beyond All Recognition"? In a thoroughly updated edition of The F-Word , Jesse Sheidlower offers a rich, revealing look at the f-bomb and its illimitable uses. Since the fifteenth century, no other word has been adapted, interpreted, euphemized, censored, and shouted with as much ardor or force..."

Peer effects in learning and teaching, but not in golf

The October '09 issue of the American Economic Journal: Applied Economics contains three papers on peer effects.* The first of these begins "Is an employee's productivity influenced by the productivity of his or her nearby co-workers? The answer to this question is important for the optimal organization of labor...and for the optimal design of incentives." It then goes on to say that it detects no such effects from the random groupings of golfers in professional golf tournaments.

The second paper does find peer effects in random groupings of cadets at West Point, and the third paper finds that students do better when their teachers have better colleagues, i.e. they find that the teachers experience peer effects as measured by the performance of their students.

*The three papers are:

"Peer effects in the workplace: Evidence from random groupings in professional golf tournaments," by Jonathan Guryan, Kory Kroft, and Matthew J. Notowidigdo.

"The Effects of Peer Group Heterogeneity on the Production of Human Capital at West Point," by David S. Lyle.

"Teaching Students and Teaching Each Other: The Importance of Peer Learning for Teachers," by C. Kirabo Jackson and Elias Bruegmann.

Paul Milgrom: Nemmer's Prize Lecture and Conference

If the creeks don't rise, I'll be at Northwestern this afternoon, listening to Paul speak about "The Promise and Problems of Market Design"

His talk will be followed by a conference in his honor tomorrow.

Here's the abstract of Paul's talk:
"Market design has become an exciting area of economics research, with many of its findings useful for setting detailed rules in real markets. For matching markets, most proposed designs aim to be "straightforward" - making it a dominant strategy for participants to report information truthfully. But some recent matching and auction designs sacrifice incentive-compatibility conditions to give priority to various other desiderata. This lecture reviews the goals of market design and the unavoidable trade-offs that are sometimes required, and explores how economists should seek to resolve these trade-offs. "

Here's the conference lineup:

Vijay Krishna (Pennsylvania State University): Auctions and Information
Larry Ausubel (University of Maryland): Auctions with Multiple Objects
Panel Discussion: Market Design.Moderated by Rakesh Vohra (Northwestern University): Susan Athey (Harvard University), Preston McAfee (California Institute of Technology), Alvin Roth (Harvard University), Paul Milgrom (Stanford University)
Stephen Morris (Princeton University): Trade and Information
Bengt Holmstrom (Massachusetts Institute of Technology): Incentives
John Roberts (Stanford University): Organizational Design

Voters find same sex marriage repugnant in Maine

Maine voters overturn state’s new same-sex marriage law.
"Maine voters overturned the state’s same-sex marriage law yesterday, delivering a potentially crushing blow to gay-rights advocates after a year when their cause seemed to be gaining momentum with legislative and legal victories in four states."...
"The “people’s veto’’ came six months after Maine’s law was approved, and one year after California voters rejected gay marriage by a similar margin."

So same sex marriage has been moved out of the repugnant category in several states by courts, and by legislatures, but not yet by voters. As the AP report notes (ungrammatically),
"Gay marriage measures have lost in every state, 31 in all, in which it has been put to a popular vote. "

The DARPA network challenge

DARPA will pay $40,000 to whoever (whichever team) first reports the locations of ten weather balloons to be inflated December 5, around the U.S. Here is the announcement: DARPA Network Challenge.

Noam Nisan has some thoughts on this at AGT, and points out that very quickly some people started to offer to share the prize among those who would notify them of individual balloon's locations, conditional on the team formed in this way winning. Here's a wiki for people to share market design ideas on how to form a winning team.

Note that this is an aggregation of information problem a little like a prediction market, even though it is for postdiction rather than prediction...

Build your own prediction market

Build your own, using the platform at http://inklingmarkets.com/

Blackmail, legal and illegal

Reflecting on the recent Letterman case, the NY Times ponders The Art of Blackmail


Doing it on your own is illegal, but if you do much the same thing by threatening a lawsuit, it is legal.


"Blackmail is a “wonderfully curious offense,” to use the phrase of Paul H. Robinson, a professor at the University of Pennsylvania Law School and his coauthors in a recent paper. A threat to tell the truth is no crime, and neither is asking someone for money. But if you demand money to prevent the truth from being told, Professor Robinson said, you’ve crossed the line. At its core, he explained, the offense is “a form of wrongful coercion.” "


However you can threaten to sue if a settlement is not reached first, and that isn't blackmail.

"Those confrontations, however, did not cross the line into the criminal realm, he said, because they had been sanitized by lawyering. Attorneys, he noted, can create a legal filing that promises to bring out unpleasant facts in depositions or during trial; a settlement is not, technically, a payoff. He called it “wrapping an extortion threat in a legal cloak.”
It happens all the time, said Gerald B. Lefcourt, a criminal defense attorney in Manhattan. “Threatened lawsuits, and even filed lawsuits, are often no more than blackmail,” he said.

Compensating donors: how about bone marrow?

The National Law Journal reports: Cancer patients seek to overturn ban on paying for bone marrow

"Prohibiting someone from making money for donating an irreplaceable kidney is one thing. But what about donating bone marrow, which replenishes itself within weeks?

That question is at the heart of a new lawsuit, filed Monday, challenging the constitutionality of the federal law that prohibits compensating bone marrow donors. The plaintiffs want to make modest recompense for such donors legal — say, paying partial tuition for a college student or making a mortgage payment for a first-time home buyer.

In the lawsuit filed Oct. 26 in the U.S. District Court for the Central District of California, cancer and blood disease patients and health care advocates are suing U.S. Attorney General Eric Holder Jr. to enjoin enforcement of provisions of the National Organ Transplant Act of 1984 that criminalize compensating donors. They argue the statute violates due process rights and interferes with public health.

"This constitutional challenge is about an arbitrary law that criminalizes a promising effort to save lives," the complaint states. A bone marrow transplant is often the "only hope" for tens of thousands of Americans diagnosed with a deadly blood disease such as leukemia. "There is a desperate shortage of unrelated marrow donors, particularly for minorities," the complaint says.

Offering modest incentives to attract more donors could end that shortage, argued Jeff Rowes of the Arlington, Va.-based Institute for Justice, who is the lead attorney for the plaintiffs. "

Megan McArdle links to the Institute of Justice press release, and suggests that inclusion of bone marrow in the National Organ Transplant Act was simply a mistake.

A paper on bone marrow donation recently appeared in the American Economic Review, you can find an ungated version here: One Chance in a Million: Altruism and the Bone Marrow Registry
by Ted C. Bergstrom, Rod Garratt, and Damien Sheehan-Connor.

The paper argues that (because of the need for bone marrow matches to be perfect on the 6-vector of Human Leukocyte Antigens, and because of different distributions of these by race and ethnicity), we would get more bang for the buck by investing in recruiting more minority donors than additional random donors.

As it happens, for non-minority donors, the present policy in many places is just the opposite of compensating donors; if you want to register as a bone marrow donor you may have to pay the costs, presently around $65.

HT: Mary O'Keeffe and Steve Leider

Update, 11/4/09: Some comment on the legal theory of the case over at the Volokh Conspiracy, with a second and third post here and here and more to come...