'A Woman is like a Tsunami: When she leaves..."

 

A Level Economics 57: Information

 1. Imperfect Information:

Imperfect information refers to a situation in which some participants in an economic transaction lack access to full or accurate information about the goods, services, or factors involved. In an ideal scenario of perfect information, all market participants have complete knowledge and understanding of the relevant factors that influence their decisions. However, in reality, information is often limited, asymmetric, or costly to obtain, leading to imperfect information.

Example: Consider a used car market where sellers possess more information about the car's condition, history, and potential issues compared to potential buyers. As a result, buyers may face uncertainty about the car's true value and quality, leading to information asymmetry.

2. Asymmetric Information: Asymmetric information is a specific type of imperfect information that occurs when one party in an economic transaction has more or better information than the other party. In such cases, the party with superior information may exploit the knowledge advantage, leading to adverse outcomes for the less informed party.

Example: In the context of health insurance, insurers may not have complete information about the health risks of individual policyholders, while policyholders may possess more knowledge about their health conditions. As a result, individuals with high health risks may be more inclined to buy insurance, leading to adverse selection, where the insurance pool becomes riskier and costs increase for insurers.

3. How Asymmetric Information Causes Market Failure: Asymmetric information can lead to market failure in various ways:

a. Adverse Selection: In the presence of asymmetric information, products or services may be disproportionately consumed by individuals with adverse characteristics, such as higher risks or lower quality. This can lead to adverse selection, where the market becomes dominated by low-quality products or high-risk consumers, creating a negative feedback loop and reducing the overall welfare.

b. Moral Hazard: Asymmetric information can create moral hazard, where one party takes greater risks or engages in undesirable behavior because they believe the other party cannot fully observe or assess their actions. For instance, individuals may engage in riskier behavior after purchasing insurance because the insurer cannot fully monitor their actions, leading to increased costs for insurers.

c. Reduced Market Efficiency: Asymmetric information disrupts the efficient allocation of resources in markets. In markets with asymmetric information, sellers may charge higher prices to exploit the lack of information among buyers, and buyers may under-consume goods or services due to uncertainty, leading to inefficiencies.

d. Distorted Contracting: Asymmetric information may result in contracts that are biased in favor of the more informed party, creating imbalances in the distribution of benefits and costs.

Assumption of Perfect Information: The concept of perfect information is an assumption used in economic models to simplify analysis. In a perfectly competitive market, it is assumed that all market participants have access to complete and accurate information about prices, product attributes, and production techniques. This assumption allows economists to study the efficient allocation of resources without considering the complexities arising from imperfect information. However, in reality, perfect information is rarely attainable, and the presence of asymmetric information can significantly affect market outcomes and lead to market failures.

In conclusion, imperfect information and asymmetric information can distort market outcomes, lead to inefficient resource allocation, and cause market failures. Policymakers may address these issues through regulations, transparency measures, and consumer protection policies to improve information disclosure and enhance market efficiency.

The Stock Market is Rigged Against the Working Class

 

Arguing the toss

Nathan Leamon in Cricinfo


Will awarding the toss to the away team even up the playing field and deliver more away Test wins, or is this yet another case of received cricketing wisdom not stacking up with the facts?


You will rarely be criticised for choosing to bat. Batting is the default setting; bowling first is seen as the gamble © Getty Images



On the first morning of the first Test between Pakistan and England in Abu Dhabi, three events came to mind. One current, one recent, one infamous. The first was the conversation between Michael Atherton and both captains at the toss and the unanimity of all concerned. The second, the recent proposal from Ricky Ponting and Michael Holding amongst others, that the toss be done away with in Test cricket and the choice given instead to the away captain. The other was Brisbane 2002, and Nasser Hussain choosing to bowl first on a day almost as hot as the one in Abu Dhabi.

Let's start with the second. The suggestion of awarding the toss to the away captain was made by Ponting as a possible solution to the perceived problem of home teams tailoring wickets to suit their strengths. And the resulting domination of home teams. "It has never been harder to win away from home", we are told repeatedly.

Ironically, the decline of away wins is one of those facts that is assumed to be true without often, it would seem, being checked. In fact, it has never been easier to win on the road. More Tests are won by the away team now than at any time in recent history.


AWAY WINS IN TESTS

Decade     Win%
2010s        28.8
2000s        28.4
1990s        23.1
1980s        21.1
1970s        22.7
1960s        21.5


This is largely down to the decline in the draw. There have been more and more results in Tests and although the proportion of them that have gone the way of the visitors has shifted slightly in favour of the home team, this has resulted in a significant rise in away wins.

That said, there are other factors that suggest the balance of power is shifting slightly towards the home team. The gap between averages at home and averages away is growing, for example. So let's assume for now that the premise is true, and that home teams are increasingly dominant.

Holding and Ponting have suggested giving the toss to the visiting captain to prevent home teams stacking the conditions in their favour. I don't know whether this is a good idea or not. But there are three reasons that we should question whether it would achieve its aims.

Firstly, it assumes groundsmen can reliably bake certain characteristics into a pitch. In practice, pitch preparation seems to be an inexact science. I have stood before Test matches around the world and listened to groundsmen describe how the pitch is going to play, only to watch it do something completely different half an hour later.

It also presupposes that the interests of groundsman and home team are aligned, which is often not the case. In England for example, venues are heavily incentivised to maximise revenues from the Tests they host by ensuring five full days' play. So groundsmen, understandably, often pay less attention to the needs of the visiting circus than to the people who pay their salary for the other 51 weeks of the year.

Secondly, there is a law of unintended consequences in sporting rule changes that can often produce the opposite result to the one intended. If a home captain had control over the pitch, the framers of this law are assuming he would back away from tilting it in his favour. Is it not just as likely that he would go the other way and seek to produce a pitch so favourable that the toss was taken out of the equation? This after all is what MS Dhoni openly sought to do when England and Australia each last toured, produce pitches that turn big from ball one, and so take the toss out of the equation. Equally, you could imagine England or Australia producing genuine green-tops that would be as helpful to the quicks on day four as day one.

But lastly, and most importantly, it assumes that captains are able to use the toss to their advantage. This is not in any way proven. In fact the evidence suggests it just isn't the case.

At the time of writing, 1,048 Tests have been played since January 1990. During that period, the side that won the toss has lost slightly more (377) matches than it has won (374). Winning the toss in the modern era appears to give a side no advantage at all.

It wasn't always so. On uncovered pitches, batting first in almost all instances was a robustly successful strategy. If it rained during the match, the pitch would deteriorate, affecting the side batting second disproportionately. Until 1970, the side batting first in a Test won 36 per cent of matches, and lost 28 per cent.

But in the modern era, the advantage of winning the toss seems to have disappeared. This is, of course, stunningly counterintuitive. Test cricket is an asymmetric game. One team bats first, then the other. And the two teams' chances of winning are not equal. The team batting first has different requirements for victory to the team batting second, and the pitch changes over the course of the match, affecting the balance of power between bat and ball. Therefore, we would assume, teams that win the toss can choose the best conditions and so gain an advantage. But they don't. How can that possibly be?

Dropped catches and a sickening injury to Simon Jones didn't help Nasser Hussain after he chose to bowl in Brisbane in 2002 © Getty Images





Sometimes, a perfectly reasonable response to current circumstances becomes a habit, then a tradition, then an article of faith that outlives the circumstances that created it. We rarely question what we know to be self-evidently true. And so the bias towards batting first seems to have outlived the circumstances that created it by several decades.

"If you win the toss, nine times out of ten you should bat. On the tenth occasion you should think about bowling and then bat."

That was a very successful strategy to adopt for the first century of Test cricket. And one that is still the default setting for most captains. In the 700 Tests played since January 2000, nearly twice as many captains have batted first than have chosen to bowl. Is it still successful?

In a word, no. In that period, the side batting first has won 36 per cent of those Tests, the side bowling first 39 per cent. The bat-first bias at the toss would seem to be neutral at best, and probably counter-productive.

It is still hard to believe that captains aren't able to use the toss to their advantage. There are venues where the evidence is stark. Some pitches clearly favour the side batting first, some the side batting second. In the 40 Tests played in Lahore, the team batting first has won just three. Adelaide by contrast is a classic bat-first venue. It starts as a batsman's paradise, but by the fifth day can be very tricky to bat on, with considerable turn for the spinners. In the 74 Tests played at the ground the side batting first have won 35, the side batting second 19. Since 1990 averages in the first innings are 44.6, in the second 38.9, the third 30.1 and the fourth 27.1 and, as you would expect, in that period, 25 out of 26 captains have chosen to bat first, gaining a considerable advantage in doing so.

These are not isolated cases. Many pitches have similarly skewed characteristics. Galle and Old Trafford for example, both have similar records to Adelaide. Karachi is as bowl-first friendly as Lahore.



****



Captains' behaviour at the toss seems to be yet another example of received cricketing wisdom not concurring with the evidence. Where what teams do doesn't seem to maximise their chances of winning. Why is this the case?

Well, part of the story involves how our brains handle information. There has been a great deal of research into memory and perception, and the results are both surprising and illuminating when it comes to our decision-making in sport. For a start, our memories don't work as you might expect. They are not akin to a videotape; we don't record a series of events and then play them back as and when they are needed.

The disturbing truth is that our unaided recall is not very good. The human brain encodes less than 10 per cent of what we experience, the rest it simply makes up. Our minds construct a narrative around the coded memories we do have that fills in the gaps with a plausible story. Faced with a huge number of random or near random events (a cricket match, for instance) our brains pattern-spot, even when there is no pattern. Our minds look for those events that they can form into a pattern or story, and that becomes the meaning or lesson that we take away from the match. Even if the vast number of events that occurred didn't fit the pattern, we disproportionately remember the ones that did.

At their best then, our memories seem to work along the lines of Albert Camus's description of fiction, they are the lie through which we tell the truth. What we remember didn't actually happen, what we remember is a story that our brains have fabricated, but one that we hope contains the essential truth of what happened in a way that we can understand and retain.

Our fallible memories are only part of the reason captains and coaches behave the way they do. There is another, far more powerful reason to make the choices they make and one which is harder to argue against. For this we need to go back to Brisbane in 2002, and Nasser Hussain choosing to bowl.


"The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function." - F. Scott Fitzgerald



It was the first Test of the Ashes, an Australian team were at the peak of their powers and playing at home in 'Fortress Brisbane', the hardest ground in the world to win at as an away team. No visiting team had won in the last 26 Tests played at the 'Gabbattoir'. Hussain won the toss and chose to bowl, Australia were 364-2 by the close of play and went on to win comfortably.

It is no use looking back with hindsight and using that to determine whether a decision was right or wrong. I am sure that if Nasser had known that choosing to bowl first would bring a host of dropped chances, the loss of a bowler to injury and Australia piling up the first-innings runs, he would have chosen to have a look behind door B and strapped his pads on.
But he didn't know, and in evaluating a past decision, we shouldn't know either. We need to remain behind the veil of ignorance, aware of all the potential paths the match could have taken, but ignorant of the one that it did.

One way we can do that is to simulate the match. There are various models that allow us to simulate matches given the playing strengths of the two sides and give probabilities for the outcome. When we do this for that Brisbane Test, we get the following probabilities for England:


Decision                  Win                  Draw                 Lose
Bat First                   4%                     3%                   93%
Bowl First                 4%                   10%                   86%



Every batsman in Australia's top seven for that match finished his career averaging over 45 (three averaged 50-plus), none of the English players did, only two averaged 40. England had a decent bowling attack. Australia had Warne, McGrath and Gillespie with 1,000 wickets between them already.

England were a pretty good side, they'd won four, lost two of their previous 10 matches. But they were hopelessly outgunned, and in alien conditions. Steve Waugh, the Australian captain, was also going to bowl if he had won the toss. If he had done then Australia would almost certainly have won the match as well. Australia were almost certainly going to win regardless of who did what at the toss.

But none of that made any difference. Hussain's decision to bowl first was castigated by the public and press of both countries. Wisden described it as "one of the costliest decisions in Test history". One senior journalist wrote that the decision should prompt the England captain "to summon his faithful hound, light a last cigarette and load a single bullet into the revolver".

For Nasser in Brisbane, read Ricky Ponting at Edgbaston in 2005, another decision to insert the opposition that has never been lived down. Yet, if either of them had batted first and lost, no one would ever remember their decision at the toss. You will rarely if ever be criticised for choosing to bat. Batting is the default setting; bowling first is seen as the gamble. And remember, the side that bats first loses significantly more than it wins.

Test cricket is one of the greatest contests in sport, a brilliant, multi-faceted contest for mind and body. But it is also a game of numbers. If you can tilt the numbers slightly in your favour, get them working for you, not against you, plot a slightly more efficient path to victory, then you are always working slightly downhill rather toiling against the slope.

As I write this, Pakistan are about to go out and bowl for the fourth consecutive day of England's first innings in Abu Dhabi on a pitch that you could land light aircraft on. They have home advantage, have made the orthodox decision, played well, and yet there is only one team that can win the match from here, and it isn't them. If this is what home advantage and winning the toss looks like then they are welcome to it.

It is all but certain that if they had ended up batting second they would now be in a considerably better position. Reverse the first innings as they have happened and Pakistan would now be batting past an exhausted England side and about to put them under the pump for a difficult last three sessions. And in the alternative scenarios where one side or the other got a first innings lead, as we have seen, those work disproportionately in favour of the side batting second.

But, we all do it. We look at a pristine wicket, flat, hard and true, and batting seems the only option. It is written into our cricketing DNA. The evidence may suggest there is a small marginal gain in bowling. But small margins be damned. If the marginal gain erodes your credibility and authority, then that is probably not an exchange you are willing to make. There are tides you can't swim against.

Which brings us back to Alastair Cook and Misbah-ul-Haq, standing in Abu Dhabi in the baking heat. Both are men of considerable character; brave, implacable and preternaturally determined to win. Each has withstood the slings and arrows of captaining their country through some fairly outrageous fortunes. Each is ready to bat first without a second thought. Because while they are certainly brave, they are not stupid. And you would have to be really stupid to make the right decision.
And there of course you have the central problem of much decision-making in cricket. This pitch is slightly different to all the other pitches that there have ever been. And you don't know for certain how it is going to play, or how that will influence the balance of power in the match. There are those who would argue that this is why stats are useless, or at best very limited.

I would agree entirely that stats are never sufficient to make a decision. There is nuance and subtlety to weigh; the brain and eye have access to information that the laptop doesn't. The feel and instincts of coaches and players, the hard-wired learning from decades in the game, contains incredibly valuable information and will always be the mainstay of decision-making that must be flexible and fluid through changing match situations. But if we are honest, we must also accept that the sheer weight and tonnage of what we don't know about how cricket works would sink a battleship. To use stats and nothing else to make decisions would be incredibly foolish, and as far as I am aware no one ever has. But equally, to insist on making decisions on incomplete information, without ever reviewing the effectiveness of those decisions would seem almost equally perverse.

I'm not saying that everyone was wrong in Abu Dhabi. I'm not saying that Misbah should have bowled. The weight of opprobrium heaped on him doesn't bear thinking about. It's the sort of decision that ends captaincies. No, Misbah had only one option and he took it. But maybe, just maybe, one day there will come a time when it isn't such an obvious choice.

MCC: the greatest anachronism of English cricket

by Maxie Allen in The Full Toss • March 16, 2012

There’s been an outbreak of egg-and-bacon-striped handbags at dawn. Sir John Major’s resignation from the Main Committee of the MCC, in a row about redevelopment plans at Lord’s, has triggered a furious war of words in St John’s Wood.

Put simply, the former prime minister took umbrage at the process by which the MCC decided to downgrade the project. He then claimed that Phillip Hodson, the club’s president, publicly misrepresented his reasons for resigning, and in response Sir John wrote an open letter to set the record straight, in scathing terms.

The saga has been all over the cricket press, and even beyond, in recent weeks – underlining the anomalously prominent role the MCC continues to maintain within the eccentric geography of English cricket.

To this observer it’s both puzzling and slightly troubling that the people who run cricket, and the mainstream media who report on it, remain so reverentially fascinated by an organisation whose function has so little resonance for the vast majority of people who follow the game in this country.

Virtually anything the Marylebone Cricket Club do or say is news – and more importantly, cricket’s opinion-formers and decision-makers attach great weight to its actions and utterances. Whenever Jonathan Agnew interviews an MCC bigwig during the TMS tea-break – which is often – you’d think from the style and manner of the questioning that he had the prime minister or Archbishop of Canterbury in the chair.

Too many people at the apex of cricket’s hierarchy buy unthinkingly into the mythology of the MCC. Their belief in it borders on the religious. A divine provenance and mystique are ascribed to everything symbolised by the red and yellow iconography.  The club’s leaders are regarded as high priests, their significance beyond question.

The reality is rather more prosaic. The MCC is a private club, and nothing more. It exists to cater for the wishes of its 18,000 members, which are twofold: to run Lord’s to their comfort and satisfaction, and to promote their influence within cricket both in England and abroad. The MCC retains several powerful roles in the game – of which more in a moment.

You can’t just walk up to the Grace Gates and join the MCC. Membership is an exclusive business. To be accepted, you must secure the endorsement of four existing members, of whom one must hold a senior rank, and then wait for twenty years. Only four hundred new members are admitted each year. But if you’re a VIP, or have influential friends in the right places, you can usually contrive to jump the queue.

Much of the MCC’s clout derives from its ownership of Lord’s, which the club incessantly proclaims to be ‘the home of cricket’. This assertion involves a distorting simplification of cricket’s early history. Lord’s was certainly one of the most important grounds in the development of cricket from rural pastime to national sport, but far from the only one. The vast majority of pioneering cricketers never played there – partly because only some of them were based in London.

Neither the first test match in England, not the first test match of all, were played at Lord’s. The latter distinction belongs to the MCG, which to my mind entitles it to an equal claim for history’s bragging rights.

The obsession with the status of Lord’s is rather unfair to England’s other long-established test grounds, all of whom have a rich heritage. If you were to list the most epic events of our nation’s test and county history, you’d find that only a few of them took place at Lord’s. Headingley provided the stage for the 1981 miracle, for Bradman in 1930, and many others beside. The Oval is where test series usually reach their climax. In 2005, Edgbaston witnessed the greatest match of all time.

Lord’s is only relevant if you are within easy reach of London. And personally, as a spectator, the place leaves me cold. I just don’t feel the magic. Lord’s is too corporate, too lacking in atmosphere, and too full of people who are there purely for the social scene, not to watch the cricket.

Nevertheless, Lord’s gives the MCC influence, which is manifested in two main ways. Firstly, the club has a permanent seat on the fourteen-member ECB Board – the most senior decision-making tier of English cricket. In other words, a private club – both unaccountable to, and exclusive from, the general cricketing public – has a direct say in the way our game is run. No other organisation of its kind enjoys this privilege. The MCC is not elected to this position – neither you nor I have any say in the matter – which it is free to use in furtherance of its own interests.

It was widely reported that, in April 2007, MCC’s then chief executive Keith Bradshaw played a leading part in the removal of Duncan Fletcher as England coach. If so, why? What business was it of his?

The MCC is cricket’s version of a hereditary peer – less an accident of history, but a convenient political arrangement between the elite powerbrokers of the English game. The reasoning goes like this: because once upon a time the MCC used to run everything, well, it wouldn’t really do to keep them out completely, would it? Especially as they’re such damn good chaps.

Why should the MCC alone enjoy so special a status, and no other of the thousands of cricket clubs in England? What’s so virtuous about it, compared to the club you or I belong to – which is almost certainly easier to join and more accessible.

What’s even more eccentric about the MCC’s place on the ECB board is that the entire county game only has three representatives. In the ECB’s reckoning, therefore, one private cricket club (which competes in no first-class competitions) deserves to have one-third of the power allocated to all eighteen counties and their supporters in their entirety.

The second stratum of MCC’s power lies in its role as custodian of the Laws of Cricket. The club decides – for the whole world – how the game shall be played, and what the rules are. From Dhaka to Bridgetown, every cricketer across the globe must conform to a code laid down in St John’s Wood, and – sorry to keep repeating this point, but it’s integral – by a private organisation in which they have no say.

Admittedly, the ICC is now also  involved in any revisions to the Laws, but the MCC have the final say, and own the copyright.

You could make a strong argument for the wisdom of delegating such a sensitive matter as cricket’s Laws to – in the form of MCC – a disinterested body with no sectional interests but the werewithal to muster huge expertise. That’s far better, the argument goes, than leaving it to the squabbling politicians of the ICC, who will act only in the selfish interests of their own nations.

But that said, the arrangement still feels peculiar, in an uncomfortable way. The ICC, and its constituent national boards, may be deeply flawed, but they are at least notionally accountable, and in some senses democratic. You could join a county club tomorrow and in theory rise up the ranks to ECB chairman. The ICC and the boards could be reformed without changing the concept underpinning their existence. None of these are true of the MCC.

Why does this one private club – and no others – enjoy such remarkable privileges? The answer lies in an interpretation of English cricket history which although blindly accepted by the establishment – and fed to us, almost as propaganda – is rather misleading.

History, as they often say, is written by the winners, and this is certainly true in cricket. From the early nineteenth century the MCC used its power, wealth and connections to take control of the game of cricket – first in England, and then the world. No one asked the club to do this, nor did they consult the public or hold a ballot. They simply, and unilaterally, assumed power, in the manner of an autocrat, and inspired by a similar sense of entitlement to that which built the British empire.

This private club, with its exclusive membership, ran test and domestic English cricket, almost on its own, until 1968. Then the Test and County Cricket Board was formed, in which the MCC maintained a hefty role until the creation of the ECB in 1997. The England team continued to play in MCC colours when overseas until the 1990s. Internationally, the MCC oversaw the ICC until as recently as 1993.

All through these near two centuries of quasi-monarchical rule, the MCC believed it was their divine right to govern. They knew best. Their role was entirely self-appointed, with the collusion of England’s social and political elite. At no stage did they claim to represent the general cricketing public, nor allow the public to participate in their processes.

The considerable authority the MCC still enjoys today derives not from its inherent virtues, or any popular mandate, but from its history. Because it has always had a leadership role, it will always be entitled to one.

The other bulwark of the MCC’s authority is predicated on the widespread assumption that the club virtually invented cricket, single-handedly. It was certainly one of the most influential clubs in the evolution of the game, and its codification in Victorian times, but far from the only one, and by no means the first. Neither did the MCC pioneer cricket’s Laws – their own first version was the fifth in all.

Hundreds of cricket clubs, across huge swathes of England, all contributed to the development of cricket into its modern form. The cast of cricket’s history is varied and complex – from the gambling aristocrats, to the wily promoters, the public schools, and the nascent county sides who invented the professional game as we know it now. Tens of thousands of individuals were involved, almost of all whom never went to Lord’s or had anything to thank the MCC for.

And that’s before you even start considering the countless Indians, West Indians, South Africans and especially Australians who all helped shape the dynamics, traditions and culture of our sport.

And yet it was the egg-and-bacon wearers who took all the credit. They appointed themselves leaders, and succeeded in doing so – due to the wealth, power and social connections of their membership. And because the winners write the history, the history says that MCC gave us cricket. It is this mythology which underpins their retention of power in the twenty first century.

Just to get things into perspective – I’m not suggesting we gather outside the Grace Gates at dawn, brandishing flaming torches. This is not an exhortation to storm the MCC’s ramparts and tear down the rose-red pavilion brick by brick until we secure the overthrow of these villainous tyrants.

In many ways the MCC is a force for good. It funds coaching and access schemes, gives aspiring young players opportunities on the ground staff, promotes the Spirit Of Cricket initiative, organises tours to remote cricketing nations, and engages in many charitable enterprises.

Their members may wear hideous ties and blazers, and usually conform to their snobbish and fusty stereotype, but no harm comes of that. As a private club, the MCC can act as it pleases, and do whatever it wants with Lord’s, which is its property.

But the MCC should have no say or involvement whatsoever in the running of English cricket. The club’s powers were never justifiable in the first place, and certainly not in the year 2012. The club must lose its place on the ECB Board. That is beyond argument.

As for the Laws, the MCC should bring their expertise to bear as consultants. But surely now the ultimate decisions should rest with the ICC.

Unpalatable though it may seem to hand over something so precious to so Byzantine an organisation, it is no longer fair or logical to expect every cricketer from Mumbai to Harare to dance to a St John’s Wood tune. This is an age in which Ireland and Afghanistan are playing serious cricket, and even China are laying the foundations. The process must be transparent, global, and participatory.

Cricket is both the beneficiary and victim of its history. No other game has a richer or more fascinating heritage, and ours has bequeathed a value system, international context, cherished rivalries, and an endless source of intrigue and delight.

But history is to be selected from with care – you maintain the traditions which still have value and relevance, and update or discard those which don’t. The role of the MCC is the apotheosis of this principle within cricket. For this private and morally remote club to still wield power in 2012 is as anachronistic as two stumps, a curved bat, and underarm bowling.

Private schools know how to game elite universities – state-educated kids don’t have this privilege

The system fails bright pupils from ordinary backgrounds. And here’s how we all lose ...

• 
• • Paul Mason
  • The Guardian, Sunday 30 November 2014 20.00 GMT

'There is, in short, massive asymmetry of information in the post-16 education system and the critical determinant is class.' Photograph: Alamy

Let’s call him Matt. Aged 16, he is tall, taciturn and highly talented. He goes to a state school and is about to choose his A-levels. For all kinds of reasons, he believes he should progress, via Oxbridge or the Ivy League, to become an aerospace engineer.

So should he do further maths? If maths is the new rock’n’roll in education, then further maths is a VIP enclosure that fewer than 15,000 young people a year get into.

Last week, I had the chance to put this question to the deputy head of a top private school. “By all means do further maths, but only if you are guaranteed to get an A,” came the answer, as if it were a no-brainer. It was advice born out of years of practical knowledge.

Other opinions are available of course – and that’s the problem. This year, a quarter of a million 16-year-olds will make their A-level choices relying on hearsay, myth and information that is outdated or uncheckable. Those choices will shape their options when it comes to university – and the courses they apply for will then shape their chances of getting in.

There is, in short, massive asymmetry of information in the post-16 education system and the critical determinant is class. Kids at private school can rely on schools that have continual informal contact with elite universities. The result is that – for all the hard work being done by outreach teams in Russell Group universities, and by access teams in state schools – there’s an inbuilt advantage among those going to private schools based on informal knowledge.

Last year’s results for further maths demonstrate the problem. In English state schools, further education and sixth-form colleges, about 11,100 young people sat the exam; in the private sector, which accounts for just 7% of the school population, 3,600 sat it. And private school results were better, with 69% getting A or A* versus 54% in state schools.

Government tables show that this achievement gap is even more pronounced for ordinary maths and the three main science subjects. There are numerous private websites that offer A-level advice, and anecdotally social media are abuzz with the wisdom of teenage crowds over course and subject choices.

But why isn’t there a central repository of information that would turn all this folkore into a level playing field of checkable knowledge? Why isn’t there a single, open-source database that models all specific pathways into higher education? Without it, state school students will always find it hard to win the inside-knowledge game.

At my old university, Sheffield, they told me that you need maths and physics as part of three A grades to study aerospace engineering. That’s in line with the Russell Group’s guide, which also tells you to add design/technology, computer science or further maths.

The admissions tutor of an Oxbridge college, however, tells me: “I think here they’d be worried about no further maths, especially if it was offered at school but they didn’t take it, though I do worry that we send out mixed messages about this.”

The knowledge asymmetries deepen once you realise that elite universities require additional, bespoke tests. Cambridge University’s website reveals that if you want to do engineering at Christ’s, Peterhouse or St John’s you might need to take an extra exam called Step.

In a cantankerous, unsigned diatribe, the Step chief examiner for 2014 complains that only 3.8% of applicants scored top marks. The majority were not prepared for the kind of thinking they had to do. “Curve-sketching skills were weak,” the examiner noted, together with “an unwillingness to be imaginative and creative, allied with a lack of thoroughness and attention to detail”.

I will wager that the people who scored top marks knew that their curves had to look like Leonardo da Vinci’s and that they had to demonstrate imagination and creativity – because their teachers had long experience of this exam, and the others had not. One Oxbridge admissions tutor admitted to me that such testing may add a further barrier to people from state schools.

Suppose Matt wants to go to Oxbridge more than he wants to be an aerospace engineer? Here the advice is – for those in the know – really clear. Don’t apply for the most popular courses, where there can be 12 people for every place. Work out the college and subject combinations that reduce the odds to just three or four to one.

Oxford’s website shows the success ratio for getting on to its popular engineering and economic management course is just 10%, while the success rate of applications for materials science is 42%. A senior administrator at Oxford told me that they suspected few state school teachers really understand this game of playing the ratios. State-school students and people from ethnic minorities crowd each other out by going for the same, obvious, high-ratio and vocational courses.

Why should this matter to the majority of young people, who do not aspire to go to an elite university? And to the rest of society? First, because it is creating needless inequality of opportunity and is just the most obvious example of how poor access to informal knowledge penalises state school kids. Second, because in an economy set to be dominated by information and technology, those 15,000 people who can attempt further maths each year are the equivalent of Aztec gold for the conquistadores. Their intelligence will be the raw material of the third industrial revolution.

There is no reason – other than maintaining privilege – to avoid presenting subject and course choices clearly, logically and transparently. When the system fails bright kids from non-privileged backgrounds, we all lose.

On writing a column - Credibility of political pundits is low but voters’ need for punditry high

By Vinod Mehta in The Times of India

Soon, the NDA government led by Prime Minister Narendra Modi will chalk up 100 days in office. For some mysterious reason this magic figure is considered an appropriate moment by the media to take stock. It is a rite of passage.

One expects that the verdict on his performance will be sharply divided. One take on the report card will show BJP scoring a century in as many days. The other take will give the party half a ton, and another will award the government less than pass marks. In a robust democracy with a lively media, all three perspectives must be seriously examined before final evaluation is made. The difficulty for citizens is they lack the tools and instruments to make an informed judgment.

So, what options does the voter have? He can speak with friends. He can go online. He can tap a person who has a reputation for being knowledgeable in such matters. But most, i suspect, will rely on the media pundit in the shape of the opinion page writer. I would go so far as to say that political commentary is the main resource available to most people to help them make up their mind.

So far so good. Unfortunately, at this precise moment a problem arises. Recently, i was talking to an old colleague, and i told him i had read an article by Mr X which i liked. “Oh, he is not to be believed,” he replied. “He gets all his information from xxx” And he then mentioned the name of a minister in the present government. My interlocutor added that the gentleman we were talking about had an axe to grind, an `agenda`. Accordingly, what he wrote needed to be taken with a shovel of salt.

Frankly, we live in such ‘interesting’ times that it is virtually impossible to locate a commentator without an agenda. An agenda-less commentator is an endangered species. Which brings us back to the luckless citizen looking for views and positions he can put his faith in. Who does he turn to if all public affairs gurus are openly partial?

I will not be revealing any secrets when i say the credibility of the pundit is at an all-time low, if you exclude the Emergency. The prevailing atmosphere of suspicion and conspiracy theories is so toxic we should not be surprised by the strong inclination towards negativity in the people. As a result, even while he is perusing a 900-word column, the reader is wondering, “Why is this lying bugger lying to me?”

These days anyone who has spent a couple of years in the profession feels qualified to become a pundit. Nothing wrong with that, but the question is, what preparation did the said journalist make before he walked into the hallowed editorial space? When i became an editor in 1974, for over a decade i never dared to write an opinion piece. I was terrified because i felt too raw and too naive. Instead, i embarked on a course of self-education.

Sadly, there were, and are, no textbooks on column writing, no mass communication institutes which can teach you the craft. The sole guide: read pundits you admire — those with a standing for honesty and objectivity.

By objectivity i am not suggesting you abandon your prejudices and preferences, but keep them in check. And, sometimes, restrain them if the message on the wall is too clear. Pseudo-secularists and assorted Modi-detesters could not ignore the hawa blowing in his favour across the country in 2013. Whatever your predilections, you had to take note of the wind whose intensity was growing by the week.

If i can identify one quality the reader is looking for in an opinion column it is ‘trust’. The reader is aware from where the columnist is coming from, what his leanings are. Despite that, he needs to ‘trust’ the writer. He must feel confident the column, at the least, will acknowledge reality, not deny reality. In my 40-odd years of editorship the highest compliment paid to me, among zillions of abuses, went, “I don’t like your opinions but i don’t think you will deliberately mislead me.”

At a time when the entire media is increasingly perceived with suspicion, why should the column-writer remain uncontaminated by partisanship? After all, the pundit is a creature of the environment we all inhabit. He does not live on Mars.

The challenge for those privileged to contribute to the ‘heart of a newspaper’, then, becomes even more daunting. In a society where columnists and editors play favourites, the victim is the reader. Who looks after his interest? Media people day in and day out affirm their commitment to the reader, and the reader alone. Alas, the commitment doesn’t stand up to scrutiny.

In short, truth and readability are essential for a column. Remember you don’t want to tell the truth in a way which puts your reader to sleep.

Is there any solution for the present depressing situation? I cannot easily think of one. However, if a solution exists it lies in the hands of the reader. He must reject those columnists (and the papers they write for) that flagrantly violate the basic canons of trust. The reader will be doing the media a favour and also the pundit, who must know he has been caught out.

Stiglitz - Bankers must go to jail

Joseph Stiglitz tells Ben Chu that rogue financiers have proven that regulation must get
tougher

Ben Chu
Monday, 2 July 2012

The Barclays Libor scandal may have shocked the British public, but Joseph Stiglitz saw it
coming decades ago. And he's convinced that jailing bankers is the best way to curb market
abuses. A towering genius of economics, Stiglitz wrote a series of papers in the 1970s and
1980s explaining how when some individuals have access to privileged knowledge that others
don't, free markets yield bad outcomes for wider society. That insight (known as the theory
of "asymmetric information") won Stiglitz the Nobel Prize for economics in 2001.

And he has leveraged those credentials relentlessly ever since to batter at the walls of "free
market fundamentalism".

It is a crusade that has taken Stiglitz from Massachusetts Institute of Technology, to the
Clinton White House, to the World Bank, to the Occupy Wall Street camp and now, to
London, to promote his new book The Price of Inequality.

And kind fortune has engineered it so that Stiglitz's UK trip has coincided with a perfect
example of the repellent consequences of asymmetric information.

When traders working for Barclays rigged the Libor interest rate and flogged toxic financial
derivatives – using their privileged position in the financial system to make profits at the
expense of their customers – they were unwittingly proving Stiglitz right.

"It's a textbook illustration," Stiglitz said. "Where there are these asymmetries a lot of these
activities are directed at rent seeking [appropriating resources from someone else rather than
creating new wealth]. That was one of my original points. It wasn't about productivity, it
was taking advantage."

Yet Stiglitz's interest in the abuses of banks extends beyond the academic. He argues that
breaking the economic and political power that has been amassed by the financial sector in
recent decades, especially in the US and the UK, is essential if we are to build a more just
and prosperous society. The first step, he says, is sending some bankers to jail. " That ought
to change. That means legislation. Banks and others have engaged in rent seeking, creating
inequality, ripping off other people, and none of them have gone to jail."

Next, politicians need to stop spending so much time listening to the financial lobby, which,
according to Stiglitz, demonstrates its spectacular economic ignorance whenever it claims
that curbs on banks' activities will damage the broader economy.

This talk of economic ignorance brings us to the eurozone crisis and the extreme austerity
policies being pursued. Stiglitz is depressed. In 2000 he resigned from the World Bank and
launched an excoriating attack on the way it and its sister institution, the International Monetary Fund, handled the Asian financial crisis of the late 1990s. He condemned the IMF
for imposing brutal and inappropriate adjustment policies on bailed out nations – medicine
which, he argued, merely pushed nations further into crisis. "For me there's some nostalgia
here," he says.

Does he see any hope for the eurozone, I ask, or is it now heading, inevitably, for a breakup?
"It is a train that can still be stopped" he says. "But the relevant question is the politics in
Germany. Have they created in their rhetoric a dynamic that makes it difficult to stop? In
particular [German Chancellor] Angela Merkel's rhetoric that the crisis was caused by
profligacy. She's framed the issue as profligacy, rather than framing it as 'the European
system is fundamentally flawed' ".

The central argument of his latest oeuvre is that the huge inequalities of income and wealth
that have developed in the US and elsewhere in the West over recent decades are not only
unjust in themselves but are retarding growth.

"Every economy needs lots of public investments – roads, technology, education," he says.
"In a democracy you're going to get more of those investments if you have more equity.
Because as societies get divided, the rich worry that you will use the power of the state to
redistribute. They therefore want to restrict the power of the state so you wind up with
weaker states, weaker public investments and weaker growth."

It's an elegantly simple proposition. And one that logically points to a radical manifesto of
redistribution and higher taxation in the name of the general public good. Time will tell
whether this comes to be regarded as another manifestation of towering economic genius.
But, for now, crusading Stiglitz has one more weapon in his hands with which to batter down
those walls of folly