Thursday, 10 May 2018

This unexpected response was mentioned in 'Freakonomics'.

From the BBC:

Fining parents for taking children out of school in term time in Wales has had no effect on overall absence rates, a review has found. It shows the number of unauthorised family holidays actually increased after fixed penalty notices were introduced in 2013...

Several respondents said that the level of the fine was too low to encourage behaviour change. They said this was particularly the case for unauthorised absences for holidays in term time because some parents preferred to pay a £60 fine compared to the price of going away in the school holidays.

One respondent said "in this deprived area many families cannot afford the costs of a holiday out of term time. If they can, they soak up the cost of the fine as part of the holiday cost (which means the fine has zero effect)".

This phenomonen was mentioned in the book 'Freakonomics', here's an article from 2013 explaining it:

In Haifa, day care centers almost uniformly closed at 4pm, and simply depended on the good intentions of parents to pick up their kids on time. Somehow, this worked: parents picked up their children on time and rarely, if ever, came after 4:30pm.

Why were parents rarely late? As Uri will tell you in our book, being late meant relying on the generosity of one teacher, who would inevitably stay late to look after your child. Being late meant facing that same teacher and having to apologize to her for the inconvenience of waiting.

All of which prompted us to wonder: what would happen if these day care centers stopped relying on generosity and started relying on a financial incentive — like a fine — to discourage parents from showing up late? Few would have predicted what we found: introducing a financial penalty for showing up late actually caused parents to do just that. Parents stopped showing up on time entirely.

To come to our surprising conclusion, Uri ran an experiment: Out of 10 daycare centers across Haifa, they randomly chose six and introduced a small fine for parents who showed up more than 10 minutes late in each of them. In day cares where the fine was introduced, parents immediately started showing up late, with tardiness levels eventually leveling out at about twice the pre-fine level. That is, introducing a fine caused twice as many parents to show up late. What about the remaining four day care centers that remained fine-free? Tardiness didn’t change at all.

The picture that emerged from this experiment, co-authored with Aldo Rustichini, was that parents had a whole set of non-financial incentives for being on time – incentives that were completely incompatible with money. Like, for example, avoiding the guilt of inconveniencing the day care workers. As soon as parents had the option to pay a small fine and avoid that guilt, they took it en masse.


ontheotherhand said...

It's not quite the same thing. Behavioural economics looks for costs other than money that provide an incentive to act a certain way. In the Freakonomics example, turning up late had the cost of the shame of having to face an annoyed teacher, whereas paying a fine turned it into a financial transaction for cheap baby sitting. "As soon as parents had the option to pay a small fine and avoid that guilt, they took it en masse." The fine somehow made it permissible.
Taking children on holiday during term time saves one heck of a lot of money. Nobody feels guilty that they are inconveniencing teachers. After all, it's one fewer child to teach for a week. What parents have to care about is 'doing the right thing'. The 'cost' is the internal conflict that comes from acting differently to how we think of ourselves. The example they give in Freakonomics is why doesn't everyone jump the queue on the slip road and cut in at the last moment? There is a cost to waiting. But there is an internal cost to act in a way that conflicts with our self perception. 'I'm not the kind of person that jumps a queue'. But we tend to be perfectly happy if we are in the back of a taxi and they jump the queue because it wasn't us.
Back to holidays. If parents think, 'I'm not the kind for person that puts money and fun before education, and disrupts school.' then no fine is needed. If parents do not care what the school thinks, then the fine will only work if it is greater than the savings.

Mark Wadsworth said...

OTOH, it is slightly different yes, but still the same general trend.

As to slip roads, you can try to jump a few places but it's extra hassle and stress and doesn't always work if nobody lets you in.

Lola said...

Jumping slip road (or any other motoring) queue.
I 'always' try and jump such queues on the basis that I can successfully game the queuing and save a lot of time and not hold up anyone else by use of superior skill. If I do hold up other people - that is my gaming was not successful - I do feel guilty. Overall gaming traffic queues is quite 'green' as it stops all the waiting and engine idling / stop start.

But there again I was taught to drive in London in the late 1960's by my old man who'd been a Gallahers rep and the gaming queue bit was part of the skills as well as trying to keep traffic flowing for everyone - e'g' letting people out of junctions etc. There were no Pelican xings then etc. We all just co-operated. See, markets work.

Lola said...

OTOH - I think BE is just cut down Austrianism. Or incomplete Austrianism. Trouble is bureaucrats like the FCA swear by it. And them using it is more dangerous than giving a toddler a Tommy gun.

Mark Wadsworth said...

L, it's the merging at the last few yards that causes the hassle, sudden braking, shunts and general unpleasantness.

The merging is much easier the sooner you do it as the cars are more spaced out. Seeing as the traffic flow is limited at the bottleneck, IMHO, the earlier people start merging, the smoother it flows in total. So I think the late jumpers do place a small burden on 'everybody else' and slow things down slightly.

Bayard said...

When I were a lad, the traffic warden in my local town almost never gave anyone a ticket. What he would do was wait in sight of the wrongly parked car and, when the driver returned, give them a public ticking off, explaining how they had inconvenienced other drivers and/or would be parkers. As a result, almost everyone abided by the rules.

Andrew Zalotocky said...

Another effect of introducing fines is that it eliminates uncertainty. If there is no fixed penalty then you don’t know what the cost of breaking the rules will be. For example, if you are thinking of arriving late at the day care centre then you have to consider the possibility that they might refuse to accept your child if you do it too often. But once the penalty has been clearly defined you can make a rational calculation as to whether it is worth paying.

Mark Wadsworth said...

B, if it worked, it worked.

AZ, that is a very good explanation of both examples.

Rich Tee said...

The whole thing amazes me. The only holidays we got in my family were the occasional visit to relatives and that was it.

Lola said...

MW. Ah, no. That's not what I meant. You can only successfully game if you don't 'barge in'. That's part of the rules. It's a 'spotting the gap thing'. and taking the opportunity.

Also on dual carriageways with one lane coned off it is best to queue in both lanes and then merge in turn. That allows more stacking.

ontheotherhand said...

Lola, yes the FCA mention BE a lot. Their interest is about Culture in financial institutions working as an incentive to moderate behaviour. In this speech by the Director of Supervision, he mentions the same nursery fine case.

and he cites another which is similar to my jumping the slip road queue motives:

"In another example, an experiment was conducted where the wording at the start of a test was changed from ‘please don’t cheat’ to ‘please don’t be a cheater’. This simple change in wording cut cheating in half."

This focus on shifting secular ethics by popular agreement (relativism) has been tried before. I started an MBA in 2002 shortly after the Enron scandal. The MBA schools all started making Ethics one of the mandatory core courses. Complete joke. The irony was at the end of the degree the school said that they suspected a few people had cheated on the Ethics take-home exam, and asked people to come forward for some amnesty. It turned out that somebody had struggled with the printer in the school library and printed a few copies of their exam answers by mistake. Dozens of students took the short cut of more or less copying his answer and cheated on the Ethics exam!

James James said...

Pretty disgraceful that local authorities have this power to fine at all. You can pull your children out of school for a year by notifying the council that you are home educating, but not for a week! Of course, if you want to stop home educating your children, you'll have to go through the process of trying to get them back in to a "good school".

Mark Wadsworth said...

OTOH, good anecdote!

JJ, indeed and agreed. But separate topic.

Lola said...

OTOH. Why put anything in an exam paper about cheating at all? If the underlying culture of the society is that cheating is wrong then the examinee already knows that. Putting those statements is evidence of a deeper malaise. Such statement would have been laughed at when I were a lad.

And as I am a very perverse sort of bloke having such guff spouted at me makes me far MORE likely to cheat as I despise the mindset of those that think it necessary to remind me not to. And they are usually self serving rent seeking bureaucrats.

OTOH for a dissertation I did for my Engineering studies I worked out what I thought the examiner would know the least about and wrote about that. That's proper gaming. :-)

Bayard said...

OTOH, cheating in an Ethics exam: that's real chutzpah!