Sunday, December 18, 2011

The Moral Effect of Studying Economics

Since writing Excellence Without a Soul, I have been arguing that undergraduate education should try to make students better people. That is, I think moral education is part of college education. I don't mean recitation of the Ten Commandments or a return to parietal rules in dormitories. For starters, I mean that when there the university itself is caught up in an ethical dilemma, it should be discussed as though there just might be a right and a wrong of it.

A variety of arguments have been used in response. A standard one, which is particularly resonant today, is that it is the job of the university to provide a forum for everyone to state their arguments, but not to pick sides--and indeed that for the university to stand for one thing would chill the speech of those who have a different point of view. 

But I hear something else too–that there is no point in trying to affect the morals of college students, because it's too late. They are who they are by the time they are in college, and our job is to enrich them intellectually, not to shape them morally.

A few years ago I ran across a nice refutation of this argument, out of the economics literature of all places. Cornell Economics professor Robert Frank and colleagues studied the effect on undergraduates of taking a standard rational-choice introductory economics course, and showed that students tend to become less altruistic and more selfish. So apparently we can have an effect on students' character after all–in the wrong direction.

I understand that other studies have confirmed and elaborated these results. The New York Times has another contribution to the literature today--The Dismal Education, Yoram Bauman of the University of Washington. His studies seem to show that studying economics doesn't degrade the generosity of the people who were going to be economists anyway. But it does have that effect on the "innocents" who did not enter introductory economics understanding the benefits of rational self-interest. Bauman writes,
… taking economics classes did have a significant negative effect on later giving by students who did not become economics majors. One interpretation of these results is that students who were not economics majors suffered a “loss of innocence” after taking an economics class, presumably because of exposure to certain ideas (like the invisible hand) or certain people (like economics teachers). 
In contrast, students who became economics majors did not suffer a loss of innocence. This may be because they lost their innocence in high school — other research suggests that pre-university exposure to economics reduces giving — or perhaps even because economics majors were “born guilty.”
At Harvard, more students take the introductory economics course than any other (though introductory computer science is catching up!). Don't studies like this have some relevance to the way we think all those future businesspeople, lawyers, doctors, engineers, and legislators should be educated?


  1. I think there's a lot of confounding variables here, so I would want to take a close look at these studies before I took any action based on them, but I can convince myself this is plausible. (I wonder whether it's more about economics-literate people being more selective, rather than less generous?) It's also unfortunate, as I think economics makes the *most compelling* case for many social causes.

    On the one hand, economics can be a bit cold. It puts numbers on things that don't always agree with what our innate morals would like to see. On the other hand, it offers a framework that people can use to help determine where charity will have the highest impact!

    My guess, assuming this is a real phenomenon, is that students come out of economics courses aware of the successes of free-market, rational ("greedy") agents, but not of the failures. And there's no doubt in my mind that, given the right prerequisites, the invisible hand/natural selection/creative destruction is the best framework there is for human progress. There's also no doubt in my mind that we have a long way to go in making these prerequisites true.

    My understanding of economics--which btw, I picked up after college, not from classes--has made me feel that it's doubly important to invest in social causes that reduce economic friction. Social safety nets and educational opportunities, to pick some easy examples, seem really important in engendering an efficient economy. To the extent our government doesn't cover these, I feel obligated to donate to charities who do.

    If students are coming out of their courses thinking that self-interest will solve society's problems, I think they've missed some of the most important lessons of economics.

  2. "If students are coming out of their courses thinking that self-interest will solve society's problems, I think they've missed some of the most important lessons of economics" -- perhaps because they don't make it into the first Ec course, which is the only course those non-Ec majors take.

  3. Dear Prof. Lewis,

    Also see a related paper by Prof. Ariel Rubinstein, the famous economist at Tel-Aviv University. (It also includes experiments with students in Israel and at Harvard/MIT.)