That is the point

I am in Colorado for what is an admittedly enviably long break from teaching classes. I have been spending time in various cities and this week had the pleasure of spending a day in the mountains with my dear friend from high school and her family.

B’s mom, M, and I were chatting a bit before we headed to breakfast (at the Butterhorn Bakery in Frisco. Love!) and she mentioned Yoram Bauman’s piece in the New York Times two weeks ago on his experiments to uncover the nature of economists’ stinginess. M was curious to hear my opinion on the matter, and so I thought I might share here what I shared with her.

At the heart of the paper is an experiment in which college students are asked whether they want to donate a nominal amount, $3, to one of two charities at the time of their class registration. One is a left-leaning group, WashPIRG, and the other a non-profit with the aim to reduce tuition rates, Affordable Tuition Now (ATN). The take-home message is that economics majors were less likely to contribute to either group and thus are “free-riding.” In addition, those who took economics classes but didn’t become majors were less likely to contribute than those who never took an economics class.

In his NYT piece, and in his paper, Bauman dismisses the type and name of the charities he employs in the experiment as rather meaningless to the outcome. “You may question whether these groups actually serve the common good, but that’s mostly beside the point.” It is my belief that the types and aims of charities are driving a lot the effect he sees, or at least have the potential to drive the effect.

For purely anecdotal purposes, I’ll tell you that I was an economics major, and I’m a little bit cheap, (have been my whole life), but that I also give to charity. Despite five years of impoverished grad student living, I still gave and will continue to give to charities I trust and admire. Now that I have a job and am feeling as though I’ve recuperated much of the year’s moving and dissertation writing losses, I’m also looking to expand that giving. Whether I give more to the charities I know or include new ones is to be determined, but you can bet that it will be a careful decision.

And I think that is where the problem comes in with Bauman’s experiment, carefulness. Research, thought, time, and emotional value all come into play when choosing charities to support. So do politics, often. And while I can’t say for sure that economics students are more careful about those decisions, if Bauman can’t account for that either, I don’t think he has a paper. Snap decisions about giving are likely very different than careful decisions about giving. And just because an economics class makes you less likely to give your money to an unknown organization with an unknown track record (or perhaps a known one that works for something that goes against some part of your belief system), I don’t think that makes us more stingy, it makes us more careful.

From an econometric standpoint, if the students who are more (or even less!) careful are the ones who are choosing not to donate–at least in that moment–then the effect you are attributing to stinginess is in fact not there. It’s what economists call an unobservable. The unobservable effect may be driving the difference in donations.

Even if economics students are not more careful, if there is any unobservable quality that is correlated with unwillingness to contribute, the effect is biased.

It’s also my experience that economics majors are more conservative–politically–than their arts and sciences counterparts. I have a hard time believing that right-leaning students would be inclined to donate to WashPIRG anyway, especially when they have likely spent a good deal of their college career dodging their canvassers in the street. (Maybe that’s just COPIRG.)

Overall, I disagree with the interpretation as much as the method. That taking an economics class leads to “loss of innocence” and thus not contributing is overly dramatic, patriarchal, and just plain silly. Aren’t we supposed to be educators? Since when is it my job to protect the innocence of college students? And why should we conflate giving with innocence?

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