Thursday, February 6, 2014

Review for Exam #1

Hi, everyone!  Exam #1 is scheduled for Wednesday, February 12, in our regular classroom, during our regular class time.  You’ll have 75 minutes to complete the exam, though you probably won’t need that.  All you need to bring to the exam is a writing utensil (preferably a pen).  To prepare for the exam, you should make use of the readings, lectures, class discussions, and the blog assignment on ways around the free rider problem (including your colleagues’ comments).  If you want to ask me questions, there are three ways to do it:

1.        Email me at the address on the syllabus (berchnorto@msn.com).  I will generally respond quickly, but I may be slowed from about 10 am Friday to Monday evening (note again that there is no class on Monday, February 10, as I’ll be away on University business).  I hope to be able to respond, but that’s not totally guaranteed.  I will respond emailed questions until 1 pm on the day of the exam.

2.       You may post a question in the comments section of this blog post (this has been very effective in other classes).  However, I’m really unlikely to be able to answer them between 10 am Friday and Monday evening.  I’ll do what I can, but I’ll catch up on Monday night.  I will answer any questions posted on the blog before 11 am on the day of the exam (technical reasons for the earlier deadline).  I urge you to take a look at the comments on Wednesday before the exam, so you can take advantage of the questions asked by your colleaguges.

3.       I will have office hours on the day of the exam from 1:45 to 3:20.

The format of the exam is simple.  There will be two essay questions focusing on the formation and maintenance of interest groups, and you will need to answer both of them (probably in 1-3 pages each).  Here are general descriptions of the questions, though you should make sure to read the specific questions on the exam and answer them in all their parts:

1.       You will be asked to explain why not every interest forms an interest group.  You’ll want to take advantage of the notion of concentrated benefits and diffuse costs, the free rider problem, and Olson’s insights into why it is much easier for smaller, privileged groups (or even intermediate groups) to form, as opposed to larger, latent groups.

2.       You will be asked to explain why some large, latent groups manage to form and perhaps even maintain themselves over time despite the insight that Olson offers into the free rider problem.  You may be asked about specific groups.  You should be prepared to discuss the different kinds of selective incentives, conditional cooperation, federation, miscalculation of costs and benefits, low costs, political entrepeneurs, and altruism, as well as any other ideas you may have.

Good luck!--NB

6 comments:

  1. Dr. Berch, can you elaborate on the miscalculation of costs and benefits? Thank you!

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    1. Perhaps one reason why people participate in interest groups is that they overestimate the chance that they will be instrumental to the group's success. While an interest group with 50,000 members is not likely to be more successful with 50,001, people may think, "If everyone thought like that, nothing would get done." Olson would say that's faulty logic. A similar example is people voting in national elections because they think they might be the deciding vote (which is either an incredibly small on null chance in actuality).

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  2. Dr. Berch, please explain altruism, latent groups, and intermediate groups.

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    1. Altruism suggests that people might act (and groups might form) because people are not just self-interested but altruistic as well. They are not just concerned about themselves but about others, too. Olson would say that that's really only another form of solidary selective incentive or purposive selective incentive. Latent groups are those that are so large that potential members can't monitor one another and feel that their own contribution is highly unlikely to contribute to the group's success. Intermediate groups are those where no one person can provide the benefit (like a single large storeowner providing street light), but where the group is small enough and each member has enough at stake that they can monitor one another and each member feels they may contribute to the group's success (like the five dairy farmers example from class). See the first two chapters of Olson for more.

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  3. Dr Berch, can you go over concentrated benefits and diffuse costs? Thank you.

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    1. Sorry for the delay. I missed this one in the slew of emails from my other class. The best example would be a proposal to raise dairy prices by law. The benefits are concentrated (they go to a handful of dairy farmers). The costs are diffuse; they are distributed amongst hundreds of thousands of milk drinkers. Thus, the dairy farmers have incentive to organize, but the milk drinkers don't. That's why the dairy farmers will probably win.

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