Extreme incentives

We are fond of setting incentives in our household for various activities. Just this week, we decided to make a push on memorising times tables. It needed an incentive on the basis that it was a pretty mindless activity that was hard to justify on any real academic basis but it was just convenient to have these things memorised for the future. The deal was: learn them this week or no Survivor. Suffice it to say, we went through much anger and bargaining before we got to resignation. Of course, we have a few days left to see if it worked.

I wondered if this might have been a bit much until I read this today from Ian Ayres:

When my 7-year-old daughter said she desperately wanted a dog, I told her (in a twist on another Obama story) she could have one if she published an article in a peer-reviewed journal.

Wow, that isn't necessarily attainable when people have to publish to keep their job. That said, apparently it worked! Here is the paper.

Our dog is named Cheby (Shev) in honor of a statistician.

Of course, when you think about it, this seems like an easy incentive compared with those Obama kids who had to get their Dad elected as President in order to get a dog.

The fine line on motivation

So it was a recent Saturday night and the following conversation took place with Child No.1:

"Come on. Would you like to watch some TV?"

"Are you kidding? I have work to do."

"But perhaps a rest is in order ..."

"Look if I don't get this homework done now I will only have to do it tomorrow. Be real!"

Ahh, I thought to myself. A chip off the old block. My daughter at home on a Saturday night working on a school project. A colleague listening in on this conversation in disbelief (and knowing my own history on this) exclaimed: "what is wrong with you people??? Are you all crazy?"

Let's face it, this isn't the most common of 9 year old problems but, as I guess so many who read this blog already know, I don't have a common 9 year old. Not only is she the epitome of the 'rational agent' in economics with clearly defined motives (food and money) and a dramatic responsiveness to incentives, she is also somewhat driven. When it comes to assigned tasks, she does them and she does them until they are done.

But it goes deeper than that. In terms of school-led authority -- in contrast, to parent-led authority -- she obeys with a literal meaning. School and teacher rules are rules meant to be followed. Not just in spirit but to the letter.

Let me give you an example. Last year, her mother was waiting for 15 minutes after the end of school for my daughter to emerge from class. All the other children had come out but she was nowhere to be seen. Eventually, she went inside. My daughter was standing dutifully behind her desk. All of the chairs in the classroom were neatly staked on the desks (as they do for nighttime cleaning). There were no other children there and there was no teacher.

"Why didn't you come out?"

"We weren't dismissed."

"What do you mean? All of the other children have gone."

"But our teacher didn't have us for the last session and we had to come back from art. So we came back and no one was here. The rest left. But since we hadn't been dismissed I figured we had to stay."

"But wasn't the fact that all these chairs were up giving you some sort of clue?"

"Oh no. When we came back they weren't up. Everyone else left without doing it. So I put them up and waited."

Now one can be comforted that our child will obey the rules but there is also something sad and deeply worrying about this episode. "If the teacher had said jump off a cliff would you do it?" You actually want your child to be more flexible than that. Although she wasn't in danger at some point you'd hope that she would realise something was amiss and rules could be broken. I guess she wasn't hungry yet.

Herein lies our current issue and that of her teacher. Child No.1 will do as she is told at school but will do it with robot-like intensity. That creates all manner of issues. For instance, this weekend she spent hours, colouring in her 'Yearbook.' Our daughter is driven but slow at tasks and so is behind in that one. She was still doing April. As I watched what she was doing I asked why she had to fill each page so completely with designs, words and colours. The reason: "our teacher says not to leave any white bits." I argued that that seemed ridiculous. "No he actually said that to the class." I then, trying to get her to question authority more, gave her a lecture about judgment and thoughtfulness on whether a task is worth doing. That would come back to bite me very quickly.

Today we did one of our rare things and inquired about this and some other rules laid down that I had put in the ridiculous category. Her teacher explained that most kids (you know, the rest of them) needed to put just a bit more effort into the Yearbooks and so he had asked the class to fill in as much as possible. But what my daughter heard was: "he doesn't like white spaces so I had better fill it all in." And it is not like she just fills for its own sake. Given other pronouncements, each bit is an intricate design without a hint of the initial page colour. Well no wonder it takes so much time. The problem was he was trying to move the mass but in the process sent my daughter to extremes.

Together her teacher and ourselves all agree she needs to do less, use judgment and prioritise more. Interestingly, many years ago, my own parents had heard complaints from a teacher of someone, who will remain nameless (but isn't my brother), that their son should really stop on the school project after Volume 2! The project did, in fact, end up in three volumes. So there is some familiarity with this problem in our family. But a good work ethic is not something we want to extinguish (it could prove quite useful in a few years). Nonetheless, that concern aside we discussed action plans to get the workload down.

One issue, of course, is that prioritisation is not a trait that I possess. As my spouse puts it, "you do everything so damn quickly you never need to worry about it." So I guess lessons in such techniques will not come from me and my "just do it" attitude.

That said, incentives can balance the situation. Saying to my daughter, get this finished in the next half hour or there is no dinner works. But it is a delicate balancing act. Get the set of prices slightly wrong and we can have an extreme response.

And there is one final piece to the puzzle. I didn't talk to the teacher today, Child No.1's mother did. She had to listen to a rant as to it being very unhelpful when a parent (I wonder who) says a particular practice is "ridiculous" when he is just trying to get some balance in the children's work habits. I guess I have to agree with that one but I did actually have a more nuanced approach that talked about what was happening at home rather than school. For school, you do what the teacher says.

Anyhow, I wondered: how did he find out about my particular opinions? Fortunately, it wasn't the case that Child No.1 had simply volunteered this information. Remember she is strategic so she knows that there is value in withholding certain things. But when asked by her teacher why her parents wanted to talk, she spilled the beans.

But that is part of the issue. Child No.1 knows that information is valuable for strategic reasons. The problem is that she is far from socially sophisticated enough to know which information should be withheld for which adult -- teacher or parents. And so she makes judgments that results in a very distorted flow of communication between ourselves and her teacher. Another difficult management issue for us.

This, however, I suspect is not an issue her mother faces. I wasn't part of the conversation but I'm pretty darn sure that all of the blame for communication difficulties and the genetic pre-dispositions of Child No.1 have been firmly laid in my lap! When I finally front up for her official parent-teacher interview next month, things could get a tad interesting.

Yes Virginia, there is an incentive system

The biggest open question surrounding the economics of Christmas is this: is the creation of Santa Clause an effective incentive system?

So my understanding of the deal is this: if a child is good throughout the year, Santa Clause comes on Christmas Eve and leaves presents for them in the form of toys and candy. If not, Santa still visits and brings coal, sticks or clothes. To determine this, Santa keeps a list throughout the year to see who is 'watching out' or 'crying.'

If a child buys into this, this would seem to be a potentially powerful incentive system for keeping them well-behaved. What is more, it removes the critical 'subjective performance evaluation' issue from the hands of the parents to the hands of a Northern dwelling, large, usually jolly manager of elves dressed in warm red clothes. Unlike parents, Santa has an incentive to keep the system going whereas a parent's claim that some behaviour would ruin Christmas would not be nearly as credible (see Donald Cox's case study #3).

But what is the evidence that this works as an incentive system? For starters, children around the age of 8 discover the truth and so it must break down at that point even if they keep their parents wondering about what they really believe. But what about before then, does it work to keep children well-behaved?

Now an obvious path to compare this to would be to compare Santa cultures with Santa-free ones. But that is imperfect because they will substitute their own incentive systems into the mix. Although, when it comes down to it, the Jewish elevation of stature of Chanukah is surely a testament to the incentive power of Santa. Sadly, for Jews, the only holiday that occurred around December involved a minor miracle whereby an oil lamp a couple of thousand years ago lasted a little longer than expected. That said, by elevating the status of Chanukah one can safely say that the communication of its true meaning has only been enhanced beyond some ritual and rather unmiraculous candle burning.

What we really need is a random experiment? Some group of families needs to be assigned to miss out on Santa visiting and this has to be communicated at the beginning of the year. Then the behaviour of their children can be assessed and compared with those operating under the status quo.

My guess is that we may find out that the whole deal doesn't do much for incentives. For starters, you can just ask my children who are forced to stick with the true meaning of Chanukah and, if they are lucky, each get one little present each (worth less than $1) for the 8 nights. Total budget for us: $24 (not including the candles). They seem to do pretty well throughout the year. Then again, we are probably substituting other incentives into the mix.

Pain acting

Children can fake being in pain or distress. Makes it hard to sort out the truth from the rest. In my experience, a bit of incentives goes a long way here. Steve Levitt thinks so too:

Apparently, they have figured out how to make needles thinner and sharper, so they slide in and out with minimal pain. At least, that’s what the nurse who gave me the shot told me. Nonetheless, my kids still cry when they get shots — at least, they do when it’s my wife’s turn to bring them to the doctor. When I’m there, I promise them a box of Nerds if they don’t cry. Lo and behold, there are never any tears. They are amazed to hear that Nerds (the candy version, that is) didn’t exist when I was a kid. Yet another example of the miracles of technology.

It is all just an application of mechanism design.

Toilet Training and Incentives: Child No.3

This week marks the end of an era for us. For the past eight and a half years we have been virtually non-stop in nappies. Now I am happy to report that Child No.3, who is just about to turn 3, is out of nappies (at least during the day). And what is more, it was all done with the efficient management style that befitting parents who have been through this twice before.

Regular readers may recall that we have dealt with the strategic behaviour of Child No.1 and the dis-interest and the well-meaning gaming of Child No.2. Those were quite a work-out. So when it came to Child No.3 we adopted a strategy, ruthless efficient in its application and very light in terms of taxing our own energy: we outsourced the whole deal.

Now, by outsourcing, I don't mean that we just sent our daughter away to some service and then they delivered her back ready to go. Those, apparently, exist for dogs and I won't pretend that we wouldn't have availed ourselves of a human service had it existed. But it does not. Instead, we relied on her carers at child care to handle the entire exercise. They initiated toilet training, encouraged our daughter and eventually succeeded well before we did much at all at home. All we were left to do was to set her straight at home which, suffice to say, is not too hard once she had revealed her abilities to the wider community.

Child care is the perfect place for all this. First of all, the carers there have as much, if not more, incentives as we do to get children trained. They change more nappies and also have to potentially deal with them for years to come. They have no desired for a 'slow to train' child. Of course, our son had to leave their capable hands before he was done and was to move to a pre-school that required a trained kid. Suffice it to say, that dampened incentives somewhat. But give child care a time horizon with another 1000 nappy changes and we have a tight alignment of interests.

Second, and this goes without saying, they have seen it all. They are simply more capable in terms of knowing the signs, assessing readiness and doing all of the other crap (literally) that first time parents think but cannot do.

Finally, the children have peers. Now the power of peer pressure is something that can lead to good and evil. The evil usually becomes apparently as your child follows others to leap off a several metre high structure or starts sucking noodles up their noses. But the good can be equally as powerful. With all the other kids successfully going to the toilet, there is intense pressure to join in and do so in a meaningful way. Your child wants to get the same cheers their friends are getting for demonstrated activity. And they don't want to have themselves tended for to clean a soiled nappy up.

Even wearing a nappy can be socially difficult. A friend's three year old son, who wasn't in lots of child care, shed himself of a nappy when he was made fun of by a random older kid in a playground. Of course, in that instance, that meant no night-time nappy and a few difficulties for his parents as a consequence of that.

For our daughter, she shed herself of a nappy at child care. Indeed, in the early part of it, she would convince some of the more part-time carers that she didn't wear a nappy; although apparently those earlier forays met with unfortunate results. But it continued later on too. I remember being informed, having collected her and driven her half the way home that, "I don't have a nappy on." Being on the freeway there was not much I could do. So I went with it and all was well.

I won't pretend that we were totally free of obligation. For a while, there was a distinct difference between her behaviours at home and elsewhere. But once we got on the program, deployed a few incentives, we were done in a matter of days.

So the moral of our story is pretty simple. When you have (virtually) once-off activities for which you have no competence to manage, you should outsource it to those who deal with it regularly and also have plenty of experience. The end result is pretty much the same but with less stress, lower pressure and cleaner carpets.