Is this a shift in incentive prizes?

"The Wolfson economics prize invites the submission of ideas for the orderly exit of one or more members of the euro zone. The one-off award is worth £250,000 ($390,000), making it second only to a Nobel in value for an economics prize." - from the Economist.com Daily Chart accessed Oct. 19th 2011.

To my mind, the appeal of incentive prizes is that they draw attention to stumbling blocks in humanity's quest for knowledge. In 1714 the British government offered a prize to whoever could find a practical means to measure longitude at sea, which they eventually awarded in 1773. Charles Lindbergh claimed a prize of $25000 for crossing the Atlantic in 1927. The X-prize incentives private rockets to explore space. These prizes were awarded for projects that self-evidently knocked over barriers to progress.

Last I heard, the jury of experts was still out on the question of whether the orderly departure of certain countries from the Eurozone would advance progress. In the meantime, this prize encourages the public to design the most efficacious means of execution.

I do not know enough about the European Monetary Union to suggest its appropriate next step. But I am interested in judgment and decision making and my prediction is that the addition of this prize to the debate space will shift its centre of gravity. Once people hear the answer to the question 'how?' the logical next step is to think about 'when'? By that point, it simply doesn't occur to people to ask the question 'why?'

I was prompted to think more deeply about this topic when I learnt that the Wolfson Prize is sponsored by Policy Exchange, a British Euroskeptic think-thank.

School quality information & school choice

The main purpose of providing information on school characteristics is that parents & students can make informed decisions about school choice. It is, after all, one of the most important decisions that parents make for their kids. All the more curious that the law in Ireland prohibits the publication of such information. But I digress.
The paper below looks at whether information on school quality does influence decisions about school choice. The effects seem rather small with students only prepared to travel 200 metres more to attend an above average school. Perhaps, there is very little variation in school quality or perhaps the Dutch are pathologically lazy.

Ranking the Schools: How Quality Information Affects School Choice in the Netherlands

Koning, Pierre &van der Wiel, Karen

This paper analyzes whether information on high school quality published by a national newspaper affects school choice in the Netherlands. For this purpose, we use both school level and individual student level data. First, we study the causal effect of quality scores on the influx of new high school students using a longitudinal school dataset. We find that negative (positive) school quality scores decrease (increase) the number of students choosing a school after the year of publication. The positive effects are particularly large for the academic school track. An academic school track receiving the most positive score sees its inflow of students rise by 15 to 20 students. Second, we study individual school choice behaviour to address the relative importance of the quality scores, as well as potential differences in the quality response between socio-economic groups.

Although the probability of attending a school is affected by its quality score, it is mainly driven by the travelling distance.

Students are only willing to travel about 200 meters more in order to attend a well-performing rather than an average school. In contrast to equity concerns that are often raised, we cannot find differences in information responses between socio-economic groups.