Transfer Pricing with "Illinibucks"

In order to fully determine what Illinibucks (bucks) are and how they work, we must first answer some questions.  Is every student given the same amount of bucks?  Are students given the opportunity to purchase more bucks?  Can students transfer or trade their bucks?  What happens if multiple students use their bucks to move to the head of the same line?

These are difficult questions to ask since the Illinibuck system seems vague and almost counterintuitive.  How would the University deal with multiple students using their bucks to get ahead in the same line?

I will imagine a scenario to illustrate how Illinibucks might work.  In this scenario, I would set up Illinibucks so that every student is given an equal amount to use each semester.  If a student has leftover bucks at the end of the semester, those will roll over to the next semester.  Students would not be able to purchase more bucks in a given semester because it would give wealthy students an advantage over other students.  Transferring bucks to another student is also not allowed because it would encourage an informal buying and selling market (which would also give advantage to students with more money).

Students would be able to use their bucks to purchase “spots in line” for housing sign-up, course registration, and appointments with academic advisors.  They could also use their bucks to move to the front of long lines in the dining halls, bookstore, and to get into shows/concerts that may be happening on campus.  Having many options from which students can choose to spend their bucks helps minimize the problem of too many students going to the front of the same lines.  Even so, students who choose to go to the front of the same lines would have two options.  The first option would be to move to a special “fast” line consisting of all the students who have used their Illinibucks to get to the front of a line.  The second option would be to bid for spots ahead of the fast line.  Students could allocate more bucks to get higher up in the line than those who already paid.  The first student in line would be the one who bid the most.  This allows students some extra degree of choice in deciding how to allocate their bucks and also solves the problem of who will be first in line.

If the prices are too low, almost everyone will choose to be in the fast lines.  This would then encourage more bidding because the fast line will not give students much of an advantage.  If the prices are too high, then there will be less bidding and each fast line will be shorter.  The prices would have to be set in a way that gave the fast line students an advantage but still encouraged some bidding.

In this scenario, I would be likely to spend most of my bucks on choosing classes.  Since I am at the University primarily to take classes toward my degree, getting a spot in the best ones is very important.  I imagine that many other students would feel the same way, so the price of early course registration would likely be much higher than the price of cutting the line for the bookstore or getting an appointment with an academic advisor.

I question how this system would work alongside other systems that the University has in place for allocating “spots in lines.”  For example, honors students get to register for classes earlier than other students, and seniors get to register before freshmen, etc.  I think it might work best if honors students had separate lines for other honors students and bid for higher spots within the honors line.  

Overall, the Illinibuck system could work with a lot of planning and a trial period, but I think our current system is better.  It seems cumbersome and somewhat arbitrary to have students pay for spots in line using Illinibucks that are given to all students.

Teamwork

During high school, I worked as a lifeguard at my local public swimming pool.  Our goal was to keep the pool safe and make sure that any struggling swimmers were helped as quickly as possible.  In total, there were 25 guards working at the pool in a given summer.  Only 10 worked each shift - one for each guard chair plus a “deck” guard and one in the office.  We rotated between chairs every twenty minutes in an order that allowed us to vary the pace of work (the guard chairs in the deep and and the kid section were the most difficult, while the slides and the zero-depth zones were some of the easiest.  The last ten minutes of every hour was “adult swim” time, meaning the guards were on break.  

Each shift, we were under the supervision of one manager (usually an older teenager who had been promoted after working at the pool for several years) and one of two head managers.  On a day-to-day basis, we guarded the pool while the managers did busy work in the office.  Once a week, however, we were required to attend one hour of in-service training in order to maintain our guard skills.

A month before the pool opened each summer, we spent several hours a week completing training. The training consisted of CPR and AED certification, teamwork exercises, drills on the rules of the pool, and in-water training.  We went through “scenarios” of every possible accident that could happen at the pool, from drowning to choking to bee stings.  The weekend before the pool opened (usually around memorial day), we went through rigorous skill tests.  All 25 guards were split into three teams.  One at a time, teams would take their positions in the guard chairs while the other lifeguards pretended to be pool-goers, purposely breaking rules, running, and splashing to distract us.  The head manager would secretly instruct one guard to pretend to drown (this person would be the “GID” - Guest In Distress. It was a sort of euphemism for the one pretending). That person would swim normally in the pool for about five minutes, then go in front of one of the lifeguard chairs and start pretending.

Then, the lifeguard who was closest to the GID had to activate the EAP (emergency action plan) by giving the whistle three long blows.  Next, all the other guards would hear this whistle and blow their own whistles to get everyone out of the pool.  Strong verbal communication was necessary here, as guards couldn’t leave their chairs to help with the rescue until all swimmers were out of their zone (each guard was in charge of his or her own zone and had to “scan” it repeatedly in 8-second repeats to ensure the safety of swimmers.  Two zones overlapped so that someone was almost always checking every area of the pool).

Once everyone was out of the pool, the other lifeguards could join in the rescue.  By this time, the “primary guard” (the one who first activated the EAP) was probably out of the water with the GID in tow.  The other guards needed to collectively call 911, grab the oxygen tank and defibrillator, and help the primary guard carry out water rescue.  As soon as the primary guard and the GID were out of the water, another guard would take over to check the GID’s pulse and lead the team in CPR.  

The structure of each lifeguard team was an all-channel network.  There was no telling who the primary guard might be if a scenario were to arise.  We all had to communicate quickly and effectively (through whistles, commands, and collectively counting chest compressions during CPR) to make sure rescues went smoothly.  

The pool also functioned as a basic hierarchy in that lifeguards reported to managers and head managers, and the head managers effectively reported to auditors. Auditors were insurance representatives who stopped by the pool without notice at least once a month.  They dressed like regular pool guests and hid cameras strategically under towels and in bags.  They videotaped each lifeguard “scanning” the pool to make sure they were following strict standards.  Once the auditor finished recording everyone, he or she announced his/her presence and it was time to begin a series of rescue scenarios.  The auditor would tell the head manager which scenario to go through, and the guards were videotaped while completing each rescue.  If steps were followed incorrectly or if the rescue was not completed successfully, we risked failing the test.  If a pool failed twice then they could be shut down by the insurance company.  

The features of high-functioning teams were, for the most part, all exhibited on our lifeguard teams.  We shaped purpose in response to demand; we had to practice and perform rescue scenarios together on a daily basis to prove to the auditors and managers that we could keep the pool safe.  This common purpose was translated into specific and measurable goals: each guard had to scan his or her entire zone in eight seconds, conscious GIDs had to be removed from the pool within two minutes of blowing the whistle, and unconscious GIDs had to be removed in just one minute.  The teams were of manageable size - ten guards at the pool for each given shift and 25 guards in all.  The one feature we were lacking in was the “mix of expertise.”  Since Lifeguarding was a minimum-wage job designed for teenagers, no one really had expertise.  We all learned the same skills during the first month of training.  More experienced guards tended to be the experts in difficult rescue scenarios, but we were all aware of the same information.

What we excelled in, however, was a commitment to strong relationships and team accountability.  It was essential that every guard communicated openly and efficiently with the others.  If we were not actively listening and watching the pool and fellow guards, we would miss a literal life-or-death opportunity.  We held ourselves collectively accountable by completing CPR as a team and talking through our actions out loud (for example, the guard in charge of the defibrillator would repeat the voice commands of the machine, saying “Safe to touch the patient” or “Shock delivered. Step away from the patient”).  Everyone would count the CPR compressions and breaths together, and if one person was not counting, one of the other guards would yell “count!”  

Our structured rescues which focused on strong communication definitely made sure that guards were held accountable for rescue performance. It also reminded us that we are a team, and the job cannot be done unless everyone works together.  To be a good teammate meant following the rules, speaking up, and acting quickly in case of a dangerous situation.

Opportunism

When I was in my senior year of high school, I ran for a position on the executive board of our high school's National Honor Society chapter.  I ran against nine other people, and four of us would be elected; one for each of the societies four pillars.  We each had to prepare a speech and come up with a plan for how we wanted to lead the society.

A week after we prepared our speeches and plans, the honor society had a meeting to remind everyone to vote after school.  All the candidates re-hashed their speeches and asked everyone to consider voting for them.  Then, we all went through the school day, waiting until after school to submit votes.

This was our opportunity for campaigning; we weren’t specifically told to campaign; it didn’t really occur to me to do anything extra since the election was not school-wide - only National Honor Society members could weigh in.  One girl, I’ll call her Rachel, took it upon herself to make sure she won the election.  She showed up to school early that day in a nice dress and tall boots.  She brought enough posters to hang up in every classroom (even the ones she had never been in previously), all of which shouted “Vote Rachel Smith” in all-capital red white and blue.  She walked around the halls all day during passing periods and after school, bribing people with candy.  “I can only give you candy if you promise to vote for me” she said with a smile.

According to the Merriam Webster online dictionary, opportunism is “the art, policy, or practice of taking advantage of opportunities or circumstances, often with little regard for principles or consequences.”  The National Honor Society election was a circumstance for opportunism.  Rachel saw that (most) high school students like candy and that the more often her name was seen/heard, the more likely she was to get votes.  Rachel’s affinity for this form of political opportunism gave her a spot on the National Honors Society executive board.  Alas, I did not do any extra campaigning and spent the year as a normal member of the society.  

I wanted a spot on the executive board, so why didn’t I practice opportunism like Rachel did?  Like I mentioned earlier, it was partly because it did not even cross my mind to do so. Rachel always had an ambitious demeanor. She was ruthless in her quest to be a perfect college applicant, and one of our english teachers even called her the “Terminator.”  She never hesitated to assert her own opinions and she was almost always right.

We were both relatively smart: honors students with top grades and lots of passed AP tests under our belts.  Where we differed, however, was in our personalities and general ways of thinking.  I was shy and soft-spoken in high school.  I knew I would feel “slimy” advocating for myself as strongly as Rachel did - in my view, people should vote for those with the best speeches and leave it at that.  The way I saw it was that anyone who campaigned for themselves so strongly would be seen as superficial.  I thought that my strategy was superior because it was genuine and simple.

Even so, after I thought about it, I saw the merit in Rachel’s strategy.  The extra work she did showed dedication and drive.  To someone like her, the way I handled the election may have seemed lazy and uncommitted.  The two of us had different definitions of what was right, best, and ethical.

I did not win the election - so does that prove opportunism to be the better strategy?  This is a difficult question to answer.  Rachel is currently studying on the pre-law track at a top-notch university and spending summers in the nation’s capital.  Her personality traits will certainly serve her well in this kind of environment.  The field of politics seems to necessitate opportunism; if you don’t shamelessly advocate for yourself, you will get lost because there will always be someone else willing to do so for themselves.  Can success exist without opportunism?  Is it possible to to find survive in a capitalist society without it?

Experience in Organizations

When I was in high school, I was a member of the HS Girls Track and Field team.  My freshman and sophomore years I ran on the Junior Varsity (JV) team and my junior and senior years I was part of Varsity.  The track team would practice monday through friday after school from 3:00 to 5:30pm.  On Saturdays, we either traveled to another school to compete in an invitational meet or met at our own school for a morning practice.  Most people did not come to practice on Saturdays, except the Varsity team (even though everyone was supposed to).  The organization that was our track and field team was led by a head coach along with one coach for each subteam (sprinters, throwers, jumpers, and long distance.  I will focus on the distance team i this post because I only raced and practiced with them.)

I gave a lot of time and effort to being on the track team.  I was slightly less involved my freshman year, but after that I came to practice every single day except in extenuating circumstances.  Being part of distance track meant more than just coming to practice during the track season.  I, along with most everyone else on the team, was also involved in summer training (which met every morning from 7-9), the cross country team (which was a similar time commitment to the track season), and winter running club (met every day for practice but there were no competitions).  Unless someone was especially talented or already committed to a different sport for one of the four seasons, everyone had to run during all four seasons to hold a spot on the Varsity team.  We had 7-9 girls on the Varsity XC team with slightly more on the distance track team because there were more events.  

My coaches faced a transaction cost in getting everyone to come to practice.  One of my coaches acted passive-aggressively toward a student after she missed practice but did not do much else.  My other coach did fun things to get us motivated to come to practice every day.  She came to practice every Saturday when there were ten-or-so of us there and bugged the rest of the team on Monday about not showing up.  She made a list of excuses that people had given and titled it “Why I Will Not Make it to State 2014.”  People started giving outlandish excuses like, “I was making cookies with my grandma”, “I was cleaning my room”, or “I played Dance Dance Revolution instead.”  It turned into a game where people were made fun of for skipping practice.  This effectively minimized the transaction costs she faced while also making the team more enjoyable.

We did something different every day at training, but our weekly schedule was pretty much always the same.  On Mondays and Wednesdays we would run timed repeats around the track.  Each runner had her own goal times set up by the coach, and we were expected to hit those times during every workout.  On Tuesdays and Thursdays, we would go out in the neighborhoods for a medium to long distance run (40-65 mins).  These were our “easy days” so we did not necessarily have to run at a certain pace.  Some of the members on our team were so motivated, however, that they ran super fast on our easy days.  On our Varsity team, pretty much everyone ran at the same pace in order to stay with the group.  So those of us who were not as motivated to push ourselves on non-workout days were encouraged by the team dynamic to run faster.  This served as a sort of positive peer pressure from the organization.  

The track and field team also affected me in positive ways academically, physically and socially.  Academically, it forced me to manage my time wisely because I usually would not get home until about 6:00pm.  I would eat dinner and get to work right away.  Physically, it of course kept me in great shape.  Beyond that, we had weekly meetings on Wednesday nights discussing healthy habits (eating, sleeping, rest & recovery) and motivational strategies.  Our distance coach also designed and printed books for each of us with space for meal diaries, workout logs, “How am I feeling today?” journals and goal setting.  The meal diary made me more mindful of what I was eating and kept me accountable for making healthy choices.  Socially, I made some of my best friends on the team and it was an environment where everyone did healthy things (running, weight lifting, journaling) together.  Spending so much time with the Varsity team and going through such tough workouts was a great bonding experience.

Joan Robinson Bio Sketch

Joan Robinson

Joan Violet Robinson was a British economist born on October 31, 1903.  She graduated from the University of Cambridge in 1925 with a degree in Economics.  She married fellow economist Austin Robinson and had two children. She went on to teach at the University of Cambridge from 1931-1971, but she did not become a full professor until 1965.  She was also part of the "Cambridge Circus", a group of scholars who helped John Maynard Keynes develop his theory on full employment.  She was nominated several times for the Nobel Prize because of her work in the field, but she never won, quite possibly because of her strongly left-leaning political views or her gender.

Robinson's work was highly influential in the field of Economics.  Her book The Economics of Imperfect Competition contributed heavily to the idea of monopolistic competition.  It is one of the main reasons why most economists believe that industries/firms are neither perfectly competitive or completely monopolistic.  Robinson was also the first to define macroeconomics, which was later described in one of Keynes' books. 

Robinson's work is especially important because she questioned norms (in Economics and in the world as a whole) and shared ideas which sparked debate.  For example, she claimed that capital cannot be fully aggregated or measured.  She also insisted that economics is about real world problems.  She brought attention to many issues in the world, including the dangers of capitalism and the arms race.  She did not go easy on herself and encouraged students to work hard and admit to what they did not know. 

I only heard about Robinson briefly before this course, when my AP Economics teacher in high school told us that it was actually a woman (Robinson) who first defined macroeconomics.  Her work will be very influential/important in class as we discuss the problems organizations face and think about how things "could have been" in contrast to what they are.  Robinson's influential work questioned existing standards in Economics, and hopefully we will continue to question the standards that organizations hold themselves up to.




Sources:
https://www.britannica.com/biography/Joan-Robinson
http://www.econlib.org/library/Enc/bios/Robinson.html
http://www.nytimes.com/1983/08/11/obituaries/prof-joan-robinson-dies-at-79-cambrdige-university-economist.html