Monday, January 12, 2009

Rent Seeking Behavior

Been reading a few things relating to this concept. Rent here is understood not as referring earnings from a lease arrangement but as in the Adam Smith economic theory where economic activity yielded income in the form of profit, wages or rents. Rents were profits that accrued as a result of economic or political manipulations that resulted in monopoly advantage but do not add productivity. Rent seeking behavior So lobbyists who use political clout to have a wildlife refuge opened up for oil exploration might be seen as engaging in rent seeking behavior.

A little bit of this is okay but if it is pervasive enough society looses out. A recent book (Boldrin and Levine, 2008) has a different take on issues of copyright and intellectual property and debunks the notion that society needs IP rights because otherwise innovation and creativity are stifled. They describe the historical scenario from the introduction of the steam engine where James Watt had the patent on the essential component. He didn't develop the technology at a very quick pace and spent more time fighting legal battles against those who had taken the steam engine idea and were trying to refine and develop it. The consequence was that it wasn't until his patents ran out that steam technology became a universal social good.

Rent seeking behavior persists in higher ed. A recent NYTimes article described new practices at MIT where the traditional lecture format of the industrial ed model is being replaced with interactive web-based practices. They report increased attendance and reduced failure rate. The new system tracks and assigns grades based on attendance so it if there is any value in the f2f educational encounter you would expect there to be a relationship between attendance and outcomes. It still is predicated on bums in seats mentality. Interesting comment in the article "Younger professors tend to be more enthusiastic about TEAL than veterans who have been perfecting their lectures for decades." I can visualize the yellowed notes and disintegrating, masking-tape-patched, overhead transparencies.

Educational institutions or teacher associations that resist more efficient and economical practices in education by lobbying for legislation or regulation of elearning are rent seeking. I think technological foot-dragging may constitute rent-seeking behavior.

I live in part of the world where education is highly subsidized from the public purse but most higher ed only occurs in the major urban centers. Part of the reason/excuse offered is that f2f is superior so there is justification in forcing everyone to migrate away from rural areas. It is becoming apparent that f2f may not be that superior after all and that, in fact, technology mediated education has significant advantages. If this is the case it means that institutional practices that follow the industrial education model are educational malpractice.

It certainly constitutes a form of rent-seeking behavior. There have been initiatives to provide access to to rural and remote areas in this province but these have been severely limited in scope and functionality.

Private education can do it. The Hutterian Broadband Network distributes education through their own videoconferencing network. You can get a degree from Athabasca University studying in a technology mediated learning environment (long way to avoid saying "online"). The University of Phoenix is being accredited for many professional programs in Canada.

Essentially the publicly funded urban institutions subtly sabotage any effort that would result in fewer bums in seats. So rural centers loose their best and brightest and the urban centers get more congested. Classic hegemonic scenario and certainly a worthy topic for a little applied critical pedagogy.

Boldrin, M., & Levine, D. (2008). Against Intellectual Monopoly. New York, NY: Cambridge University Press. Retrieved January 12, 2009, from

Rimer, S. (2009, January 12). At M.I.T., Large Lectures Are Going the Way of the Blackboard . New York Times. Retrieved January 13, 2009, from

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