Bryan Caplan  

Balan's Test

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My debate partner David Balan poses a fascinating test of the signaling model in the comments:

Here's a possible test. Among Israeli Jews there is a substantial religious minority known as "Ultra-Orthodox" or "Haredi" Jews. In this group a large fraction of the adult men neither go to the army nor to work, instead they spend most of their lives in yeshivot studying religious texts. They usually receive little or no secular education. Because of the poverty that this causes, which is exacerbated by large families, a relatively small number of Haredi men are starting to seek vocational training and going out to work. This number may or may not grow significantly, depending on how various intra- and inter-communal political battles play out.

These yeshiva students have definitely been trained in self-discipline; yeshivot have much much more demanding schedules than regular schools. And the study of the religious texts, particularly the Talmud, involves a certain amount of what, stretching the term a bit, could be called logical reasoning (though most definitely *not* rationalism), so they have a relatively high level of cognitive training and literacy.

So here's the question for Bryan. If these guys do ever decide to enter the work force in large numbers, how do you think they'll do? If education is all about signaling, then it seems like they should do pretty well: they can demonstrate having done difficult deeds, just like someone who got into and out of a selective college. Moreover, to the extent that what school actually teaches you is merely basic reasoning and literacy, they get a fair amount of it, which also suggests that they should do OK. If, on the other hand, secular education actually teaches you something beyond how to read and do certain narrow cognitive tasks, they should have a lot of trouble.

What do you think will happen? Does your answer depend on how many of them enter the workforce at once (maybe there are niches that a relatively small number of them could successfully work in, but not enough to employ a very large number of people with that background)? There may even be a bet in here somewhere.

I wouldn't accept this as the make-or-break test of the signaling hypothesis, but I'll certainly agree that the more important signaling is relative to human capital, the better the prospects of the ultra-Orthodox who choose to enter the modern economy. 

The fly in the ointment is that there are obviously non-educational differences between the ultra-Orthodox and other Israelis; in particular, they've shown multi-generational indifference to worldly success.  But I'll still predict that ten years after they enter the secular labor force, the ultra-Orthodox will perform much better than their years of secular educational attainment predict.

COMMENTS (8 to date)
Noah Yetter writes:

I don't think this is a very good test. Signalling isn't necessarily about content as about agreement. That is, a large component of the signalling value of a college degree doesn't come from all the things that a college degree implies, it comes from the fact that we've all implicitly agreed that a college degree is a valid signal. So we should not expect that because a college degree and a yeshiva "education" imply similar character traits that they will have similar signalling value.

The other major item this misses is socialization. Going to college involves a certain degree and type of socialization, which becomes part of its signal. The religious "equivalent" described above is missing that component entirely.

Les Cargill writes:

I feel like this whole multi-blog, multi-thread debate is looking through the wrong end of the telescope.

The function of education is to maximize utility *to* the student, not *of* the student. If someone who would otherwise be B-school bound finds something in art or music that is better than that, for themselves, then we won that case. Likewise, a musician who learns enough about business to survive is clearly better off.

This, to me, is like the themes of "A Man For All Seasons" - it is the conscience of the individual that matters, not the efficiency curve of the process. That's the most Liberal thing I can think of. If all goods are private, surely this is the most private good of all.

I recall an overall understanding that education would improve my lot economically, but the real reason I bothered was because I had questions. If people who suffer the process don't have those, I can't see how any of it does them any good. How painful that must have been.

Norman Maynard writes:

"Choosing an alternative school signals weirdness almost by definition."

If you truly believe this from your reply to Dickens, then Balan's test won't test signaling at all.

Tracy W writes:

On the other hand, those "Haredi" Jews presumably are under strong social and religious pressures to study for so many years, so the results may not indicate much about an individual Haredi man's self-discipline in other contexts.

Salem writes:


Is the theory that the "signalling" of education simply helps you get a job? And that once in employment, it's your actual abilities that count? If so, these Haredi should do better than their secular education would suggest.

Or is the theory that the "signalling" of education is an ongoing process? If so then Noah Yetter and Norman Maynard are right that they will be disadvantaged in an ongoing way. Perhaps if this is the case, we might expect self-employed Haredi to do proportionately better than those employed by someone else?

Les writes:

The ultra-Orthodox will perform much better than their years of secular educational attainment predict?

This is a virtual certainty. Since they have zero secular education, they can't fail to do better than their years of secular educational attainment predict.

Steve Sailer writes:

Who's ever heard of Orthodox Jews doing good in business?

mdc writes:

What does this actually signal, though? That you have immense self-discipline and drive? Or that you're an ivory tower religious lunatic who doesn't care to dirty his hands in trade? It's an interesting notion but there are far too many uncontrolled variables here.

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