Six keys to making high school choices

An article on my research in the Sun Herald, Sydney, 7 Aug 2016

Understanding the behavioural economics behind choosing a school can save parents a lot of time, writes JAMES MELOUNE

Education is the bedrock of a prosperous society. However the responsibility for getting education “right” and wealth of school choices can be bewildering for some parents.

The behavioural economics behind decisions parents make has prompted Sean Leaver, a former banker, to survey parents. Leaver, a PhD candidate at Melbourne’s RMIT University, has surveyed more than 800 families. His thesis, Behavioural Economics and the Complexity of School Choice, has found there are six keys to high school choice.

1.        PRIORITISE CRITERIA

Leaver’s study found that parents fall into one of five groups, based on what they feel is most important for their child’s development. Continue reading

Intergenerational discounting & parental investment in education: Evolutionary basis for a zero discount rate heuristic

I will be presenting at the ‘Cooperation and Conflict in the Family’ conference – UNSW in Sydney, Australia from February 2-5 2014. This is a multidisciplinary conference drawing together evolutionary economics, sociology & anthropology.

ABSTRACT This paper discusses the absence of intertemporal discounting in human parent decision making behaviour associated with choices and investments in their children’s education. This behaviour is inconsistent with standard rational choice theory where parents should maximise the present value of the utility of their consumption choices over time. Nor is it consistent with behavioural economics’ expectation that individuals discount consumption choices across time periods hyperbolically. Parents applying a zero discount rate to the expected future returns from investments in their children’s education is however consistent with evolutionary theory. We propose that the proximate cause of this behaviour is a meta-heuristic, intergenerational temporal empathy, which is constructed from a core set of cognitive biases and heuristics so as to cancel out hyperbolic discounting behaviour normally associated with non-offspring investment related consumption across time periods. The ultimate cause of this meta-heuristic is to eliminate the propensity of hyperbolic discounting behaviour to under-invest in offspring development, thereby ensuring that inclusive fitness is maximised. Intergenerational temporal empathy also has characteristics of a positive feedback mechanism ensuring that beneficial educational strategies are propagated forward and may help explain divergent outcomes for low socio-economic groups where poor educational investment decisions tend to be reinforced across generations.

Determinants of parental school choice: A Qualitative Study

I’m currently undertaking a qualitative study into the determinants of parental school choice.  The study comprises 22 semi-structured exploratory interviews of Australian parents,  principally from Melbourne with some from regional Victoria.  Parents come from diverse backgrounds of educational history, educational choice of school type, and cultural.

Following from George Shackle that for choice there need to be alternatives, the socio-economic backgrounds of the parents interviewed are broadly middle socio-economic, from low to high middle class.  For the very wealthy there is no alternative to the ‘best’ and for the low socio-economic parents income & behavioural constraints mean that there are no alternatives to their default choice.

Australia is a particularly interesting country to investigate the decision architecture of how parents choose a school for their children due to the absence of strong racial (USA) or social-class preferences (UK).  Race and social-class preferences are present in Australia but are not strong enough to completely outweigh other preferences that it is difficult to differentiate preferences associate with teacher quality, student personal development, discipline and community.  Race in the USA and social-class in the UK have become dominant proxies for these more differentiated preferences leading to simple binary choice decision making.

Having a range of differentiated preference attributes allow a deeper investigation into how social & family human capital investment preferences are traded-off between each other and the decision strategies that are being used.  When there a number of competing preferences which are quite varied, it can be very interesting to find some behaviours that should be present but is consistently missing from the interviews.  When choices are binary by proxy it is difficult to find decision structure and gaps.

Parental choice is extraordinarily complex being both inter-generational and inter-temporal in nature. It is subject to parental income, time and regulatory constraints. Choice is subject to high levels of uncertainty over very long time frames. Choices are path dependent, in most case irreversible and subject to imperfect information. Individual choice is also very context dependent, subject to the experiences of parents, their expectations of the future, a duty to their children and emotional attachment.

Where there is a common curriculum, choice is not about the quality of ‘education as knowledge’ per se. At a very high level, education choice is about quality of instruction, teacher quality or program choice, or the quality of the learning environment effected by student peers and culture. Individual preferences of parents are reflected in the type of school they choose for their child to attend. Choice may be a default choice based on constraints, or a choice exercise within a type of schools such as different public schools, or across school types.

The main education choice that this study focuses on is choice of secondary school by parents for their children.  Choices in Australia are: independent schools (generally Protestant religion aligned), Catholic schools, government public schools (entry determined by residential boundary), and government selective public schools (academic, music, sport etc.).  The state of Victoria also has an accelerated learning program in some publics schools which are not constrained by location of residence by require passing an entrance exam.

A comprehensive review of the Australian school sector can be found in the Gonski Review.

It is important to note that unlike the USA, funding of schools in Australia is from broad based taxes (universal vouchers approach) and not aligned with local property taxes.

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