Wednesday 23 December 2009

Mechanism design - academia

Presumably the government and the Tertiary Education Commission have figured out a clever mechanism design solution for the problem highlighted by Walker here. In short, University funding in New Zealand will soon be linked to student grades.

Of course, the equilibrium to that game, as Paul notes, is everyone gets an A+. The more respectable institutions would take longer to reach that equilibrium, but you can only watch the dodgy places rake in the cash for giving folks an A+ for taking a free CD-Rom for so long. The only workaround I can think of is moving back to purely external assessment, with all papers being graded offshore.

The Press article notes that while funding will initially be linked to student results, it'll eventually move to being linked to graduates' eventual jobs. I wonder how they'll track that. We don't even know where most of our undergrads wind up. What do they do with the large chunk of students who head overseas for their OE after finishing University?

This could all prove interesting. If it's the simple "first grades, then whether employed (or salary on employment)", the equilibrium is grade inflation plus refusing admission to anyone with a poor statistical chance of achieving decent employment outcomes.


  1. I've always been a champion for less people in HE, higher quality, more funding per capita. Do you have external moderation in NZ? In Britain and Northern Ireland that the best, the borderline and a random sample are sent for blind assessment at another university. Hence grade inflation is alleged to be an Ivy League problem, but not a Russell Group problem.

    Maybe that middle ground, if they want to do this: random samples sent offshore for marking. Like half-caf coffee.

  2. Got an 80 pager on this yesterday - some light reading for when I get back to work.

    Historically in the ITP sector there were some funding advantages to enrolling students on Diplomas or Degrees even if they only wanted to complete a Certificate - these changes will switch that around. Courses will become mini qualifications so that there are higher completion rates (though they will be weighted on length / level for funding purposes).

    Merry Xmas Eric!

  3. @Chris: No external moderation on anything but theses and dissertations; solving this one would require external out of country moderation. Agree that too many folks go to university.

    @Hefe: I'd be particularly interested in anything in there on the mechanics of how unis might be funded on the basis of assigned grades, and how they get around the obvious grade inflation incentive. What do you mean by "courses will become mini qualifications": does that mean that TEC has to certify every new course proposal? Surely not.

  4. Hey Doctors Crampton and Hogan :)

    Merry Christmas guys! I've loved your blogs this year, and your never ending enthusiasm to write them. Keep up the interesting work

    James Hogan

  5. Thanks! Seamus may even emerge again as his term as HoD ends....

  6. You can basically register any course as a 'short award' which will then count as a qualification completion in the stats rather than just a course completion. The process for qualification approval and registration is more involved but all courses also have to be approved and registered - I think mainly to check that EFTS match teaching hours and the correct funding category etc.