Friday, October 26, 2007

Economics of a Foreign Education!!

Incentives and opportunity costs are the most basic things that are taught in intro econ courses. People respond to incentives and opportunity costs play an important role in individuals' choices. As a third year grad student, my incentive structure is pretty clear, either be productive, progress towards dissertation and write papers or lose funding for the fourth year. I have always felt that the opportunity costs facing international students is higher than that of local students. Not only are our funding choices fewer, we have the added disadvantage of lower access to local credit markets and the added burden of keeping the immigration authorities happy by remaining in status all the time. As foreign students we also have to adapt to the local school conditions pretty quickly while experiencing culture shock and being far away from the comfort of family and close friends and a known environment. Thus, if I were to model this, the number of variables that enter the equation for foreign students is much higher than that of local students. Given that, academic performance is the sole judgment criterion and none of these other variables enter into the equation and both international and local students are assessed solely based on academic merit. This has always seemed a little unfair to me. On the other hand, foreign students do make the conscious choice to study here far away from a comfortable environment. Thus we may be able to say that these have been factored into their preference function. Then again, there are so many uncertainties. Even I, a very progressive open minded and much-aware-of-American-culture-before-I-came-here kind of person have adjustment problems. Its a high cost to pay with uncertain returns. Are the economic costs of my economics education worth the economic and non economic benefits? Must be!! Otherwise, I would have quit long back and done something that was more worth my time!! Who said people do not make economic decisions or that they do not think in terms of economics at every juncture of their lives? But then again I am a nerdy economist in the making, who sees economics in everything, just like Neo could see through the Matrix!! :)

Monday, October 08, 2007

Translating Hayek into Indian languages

I have been reading a lot of Hayek lately for my Constitutional class and one thing that strikes me is that there is no translation of Hayek into any Indian language. That is really strange since Marx is read by at least two linguistic groups in their local language. I wish I could say I was proficient enough scientifically in any other language than English. Then I would gladly take on the job of translating Hayek and Buchanan and Tullock for Indian audiences. There are a lot of very literate people in India who read the dailies. All we need is a good local language translation and the rights to run a Road to Serfdom or Calculus of Consent series in one of the dailies. In less than one generation we can convert India from a Socialist country to a free market country. Need to go find that Charles Koch of India who would sponsor such an activity and a scholar who can do the translation.

Sunday, October 07, 2007

Diminishing marginal utility

Econ grad students including yours truly are forever complaining about the lack of time to do everything they want, especially all the readings that need to be done before class. This past week, I had no reason to complain about lack of time cause I had plenty of time to do all my readings and some. That however did not translate to me not complaining. My complaint this time, I had too much time. As the curious economist that I am, I know why I wasn't as successful with lots of time. The law of diminishing marginal utility. When the usual week (with classes and work) gives me about 40 hours of effective reading time, this past week I had more than double that, the result, I did not really enjoy all the free time. The economic explanation is that I had diminishing marginal utility in free time. Once I had enjoyed one full day of relaxation, I could not enjoy relaxation an more. In fact I was tired of relaxing and was itching to go back to my regular schedule of studying. Proves again that you can find economics in the most commonest everyday things.