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Saturday, September 18, 2010


People Act with a Purpose

People act with a purpose. When Dr. Eubanks mentioned this idea on Thursday, it resounded with me. This axiom on which Mancur Olson basis his theory in The Logic of Collective Action does a great deal in providing an explanation for any and every human behavior. No matter who the person is or what he decides to do, he exists for a purpose, and he decides for a reason. Every individual who acts and every group that is mobilized (whether large or small) follows this principle. Furthermore, since people are purpose-driven, incentives matter. This comes as no surprise of course. People do what helps them further their purpose and goals, and incentives can be critical in determining whether an action will further a goal or not.

In general, why do people fail to contribute to a group? Naturally, it is because they are not incentivized to do so. In The Logic of Collective Action, this is what Olson shares with us. People only contribute to a large latent group if they are forced to do so or if they receive some personal benefit or incentive for doing so. More specifically, I would like to ask this question: why do people fail to contribute to this class? Well, our class is not a large latent group. Really, it is a small group—only about twenty people. I must admit I am surprised by how few people actually speak up in class. However, perhaps I should not be so surprised. The students in this and in any class are each here for a different reason. We each have our own purpose for being present. What are the incentives for class participation? One would certainly be a better grade, another would be the personal satisfaction that comes with participation, and a third would be an increased understanding of economics and of the world in general. Of course, there are also always trade-offs, and each student has a different opportunity cost for participating in this class. Each student must make a decision. If the marginal benefits of class participation and of the adjoining incentives outweigh the marginal cost of such participation, the student will participate, and if not, he will choose not to. Dr. Eubanks will not force us to participate in his class. He will only incentivize us to do so. Each individual values those incentives differently and also faces a different opportunity cost. Therefore, some will participate and others will not.

People are reasoning individuals who care about something (whether that be learning, making money, getting a degree with as little effort as possible, spending time with friends and family, etc.). We wonder why others do what they do, and though the reasons may be obscure to us, each person is acting for some purpose. There is an underlying reason behind every action—both individual actions and collective ones.

This is a very interesting thing that you bring up, because you would think that more people would speak up because the incentives are there. The more you talk, the more points you earn. I know that my incentive personally is a good grade. I am paying for my schooling so I wish to achieve as good a grade as possible. Although I would rather just sit and chill during class because I honestly I don't understand the topics as well as some of the other students, I realize that participating is the means to a better grade. Although I am sure that the students who do not speak out are either nervous to talk, do not understand the topic, or are fine with just turning in their quotes of the week. For the people that do not speak up, it is to be assumed that the incentives are not enough, and that the cost of them not speaking have not past the benefits they feel they receive from not participating.
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