Bryan Caplan: 1. Finish high school. 2. Get a full-time job once you finish school. 3. Get married before you have children. …. While hardly anyone explicitly uses [this] success sequence to argue that we underrate the blameworthiness of the poor for their own troubles, critics still hear this argument loud and clear – and vociferously object. … Everyone – even the original researchers – insists that the success sequence sheds little or no light on who to blame for poverty. … talking about the success sequence so agitates the critics.
If this is true, then the example you used at the start is very bad—that advice is so generic that it’s not plausible that someone simply never heard it, so pretending to have not heard it wouldn’t work.
"My conclusion: most people are well aware of a lot of advice, widely interpreted as good advice, that they don’t intend to follow."
The evidence you cite in favor of this is one interview with one person... I assume you have more reason to believe it than that.
My model of what might be happening is rather different. Probably a big part of what's happening is that people vary in how weak-willed they are, i.e. how easy it is to succumb to temptation and do something you know you probably shouldn't.
On top of that, people vary in how much they are exposed to temptation. If you have lots of candy sitting around, you're more likely to snack on it in a weak-willed moment. If there are drugs for sale on the nearest street corner, the same phenomenon manifests itself.
Combine this with the effects of social pressure (how normal is it for people whose opinions you value to do drugs or get a job, and how much will they rag on you if you make that choice?) and this explanation starts to look a lot more realistic than "people just have a strong preference to become unsuccessful and they make that choice with clear eyes and conviction." Which seems to be Caplan's model of poverty.
Actually, I've thought of a better investment analogy. When someone, not at the behest of the company, buys a ton of stock and starts offering suggestions (an activist investor), the company tends to resist that advice. That's pretty analogous to what you're suggesting here. The investor has a stake in the company doing better, the company wants to do better, but it's not a smooth path to integrating the "advice".
I'm focused on an area where there is only one willing participant to the transaction, which is what you're proposing.
Investors and lenders are providing money to the business; your plan doesn't have the patron paying anything to the worker directly, does it? I don't see that as a good analogy.
Debt holders have more things to threaten with. These agents would have no such threats available to them. If there's nothing they can do, and so don't do anything, we will be no worse off than we are now.
So, there's somewhat of an analogous situation today with debt. You can buy bad debt for pennies on the dollar, and there's nothing stopping you from providing transformative advice to debtors and recouping costs if it works. That's not how things work out in practice.
Student loan providers also seem to have a strong financial incentive to turn around the lives of their borrowers who are in default. They don't make any effort to do so.
In both of these cases the real-world companies involved deploy harassment rather than moral suasion.
Earning potential is far from the only thing we value from education.
For example, the New York State court system, when trying to decide what the right to a "sound basic education" in its state constitution meant, decided that it meant an education that left someone competent to vote and serve on a jury...
I am strongly in favor of agents for more workers, based on my positive experience with my real estate agent, and based on how well it works for actors and authors.
Despite the horror stories, for many creative types, having an encouraging and fierce advocate in their corner is pivotal.
I have even contemplated starting such a business myself. Tech workers often change jobs every 1-3 years, and an agent could get 10% of the salary, or some such arrangement.
I would personally pay such a percentage - as long as I am getting a substantial salary bump every few years, the agent more than pays for their percentage!
However, "people actually hate good advice" is far from a parsimonious explanation for the poor reception of your ideas. This is just a bad idea.
I can choose my agent; I can't choose who can buy my tax obligation. Because I choose my agent, I have some reason to trust them. Not so here, maybe even the opposite.
Further, if I feel - for whatever reason - that my agent isn't giving me good advice, I can disalign our incentives by ending our contract. Here, I can't, and I don't want my financial interests forcibly aligned with those of someone else.
I don't even need to give you a reason why - rather, you must give reasons why such a forcible financial alignment could never go wrong.
You say there can be no problem, because "People almost always have not-perfectly-aligned interests in almost all contexts." But people can usually simply leave situations they don't like. You want to create one they can't.
Agents are a very good idea. Government-enforced agents are a bad one.
If this is true, then the example you used at the start is very bad—that advice is so generic that it’s not plausible that someone simply never heard it, so pretending to have not heard it wouldn’t work.
I'll drop you a note (Mike Goldstein) - we could use a brain like yours to help us conceptualize this better...
I was trying to explain their disinterest in getting advice, not a lack of following advice.
"My conclusion: most people are well aware of a lot of advice, widely interpreted as good advice, that they don’t intend to follow."
The evidence you cite in favor of this is one interview with one person... I assume you have more reason to believe it than that.
My model of what might be happening is rather different. Probably a big part of what's happening is that people vary in how weak-willed they are, i.e. how easy it is to succumb to temptation and do something you know you probably shouldn't.
On top of that, people vary in how much they are exposed to temptation. If you have lots of candy sitting around, you're more likely to snack on it in a weak-willed moment. If there are drugs for sale on the nearest street corner, the same phenomenon manifests itself.
Combine this with the effects of social pressure (how normal is it for people whose opinions you value to do drugs or get a job, and how much will they rag on you if you make that choice?) and this explanation starts to look a lot more realistic than "people just have a strong preference to become unsuccessful and they make that choice with clear eyes and conviction." Which seems to be Caplan's model of poverty.
Actually, I've thought of a better investment analogy. When someone, not at the behest of the company, buys a ton of stock and starts offering suggestions (an activist investor), the company tends to resist that advice. That's pretty analogous to what you're suggesting here. The investor has a stake in the company doing better, the company wants to do better, but it's not a smooth path to integrating the "advice".
I'm focused on an area where there is only one willing participant to the transaction, which is what you're proposing.
Investors and lenders are providing money to the business; your plan doesn't have the patron paying anything to the worker directly, does it? I don't see that as a good analogy.
You are focused on debtors who have stopped paying. Investors and lenders to businesses help therm all the time.
But if one could successfully deploy this approach, wouldn't someone, somewhere be trying it? Wouldn't debt be more valuable if it were viable?
Bad medical debt that is out of statute -- legally unenforceable -- starts out at .2 cents/dollar.
Debt holders have more things to threaten with. These agents would have no such threats available to them. If there's nothing they can do, and so don't do anything, we will be no worse off than we are now.
So, there's somewhat of an analogous situation today with debt. You can buy bad debt for pennies on the dollar, and there's nothing stopping you from providing transformative advice to debtors and recouping costs if it works. That's not how things work out in practice.
Student loan providers also seem to have a strong financial incentive to turn around the lives of their borrowers who are in default. They don't make any effort to do so.
In both of these cases the real-world companies involved deploy harassment rather than moral suasion.
I'd love to find better ways to support efforts such as yours.
Earning potential is far from the only thing we value from education.
For example, the New York State court system, when trying to decide what the right to a "sound basic education" in its state constitution meant, decided that it meant an education that left someone competent to vote and serve on a jury...
I am strongly in favor of agents for more workers, based on my positive experience with my real estate agent, and based on how well it works for actors and authors.
Despite the horror stories, for many creative types, having an encouraging and fierce advocate in their corner is pivotal.
I have even contemplated starting such a business myself. Tech workers often change jobs every 1-3 years, and an agent could get 10% of the salary, or some such arrangement.
I would personally pay such a percentage - as long as I am getting a substantial salary bump every few years, the agent more than pays for their percentage!
However, "people actually hate good advice" is far from a parsimonious explanation for the poor reception of your ideas. This is just a bad idea.
I can choose my agent; I can't choose who can buy my tax obligation. Because I choose my agent, I have some reason to trust them. Not so here, maybe even the opposite.
Further, if I feel - for whatever reason - that my agent isn't giving me good advice, I can disalign our incentives by ending our contract. Here, I can't, and I don't want my financial interests forcibly aligned with those of someone else.
I don't even need to give you a reason why - rather, you must give reasons why such a forcible financial alignment could never go wrong.
You say there can be no problem, because "People almost always have not-perfectly-aligned interests in almost all contexts." But people can usually simply leave situations they don't like. You want to create one they can't.
Agents are a very good idea. Government-enforced agents are a bad one.
Its not obvious that the winning auction bid for each person has to be made public.
Oh, is that why we have spouses? Perhaps there’s a better analogy out there.
Thanks--hadn't seen prior post.
Any thoughts about the advice mostly being a selection effect (i.e. those who followed the advice were different to begin with)?
Do you think that agents could really develop/advise/motivate or would it mostly come to their scouting abilities?