The Economics of Evaluating Efficiency Gains in Economic Education

Abstract

It was a pleasure to read in this journal Robert Staafs demonstration that economic education, and education more generally, can be discussed seriously in terms other than those of a computer printout [I]. But he has apparently overlooked several implications of his analysis relating to faculty evaluations and rationality of economists' attempts to upgrade their own particular education technology. Specifically, if a course in economics is in fact an inferior good, as suggested by Staaf, then an improvement in the efficiency of the economic education process may lead to a deterioration in the relative income level of economic educators vis-a-vis instructors in other fields. Furthermore, it may be more rational for economic educators to spend their time attempting to change the preferences of their students rather than trying to increase the efficiency of the learning process. The present argument is generally relevant to the principles course and to situations in which administrators are required to rank faculty members from several diverse fields.' The conclusions reached must, however, be hedged on all sides and in the end depend on many relationships, which, because of lack of information and the generality of the argument, cannot be specified. Nevertheless, the discussion does serve the function of pinpointing potential pitfalls in the evaluation of faculty members by administrators and students. Certainly, the argument suggests that faculty evaluations are perhaps less reliable than has heretofore been presumed, even by their opponents. To make these points, let us use the graph in Figure 1, which is similar to Staaf's model. The improvement in economic understanding is measured along the horizontal axis, and the improvement in understanding in some other elective or course in the student's major is measured along the vertical axis. Assuming a limited study time, equal student learning ability and an unchanging method of course presentation in both fields, the student will face an expected trade-off path such as ME, which for simplicity is assumed to be linear. Once on the frontier the student can elect to increase his achievements in economics at the expense of achievements in other courses. Given the fact that passing a course in introductory economics may be a graduation requirement, the stu-