Using focal random selection to close the gender job- and pay-gaps

Those well funded Swiss researchers have just produced another Report on the benefits of using a lottery as part of the job-appointment process.

By ‘focal’ they mean a two stage process (focussed?) with all applicants undergoing an ability test and the top three being entered into a draw, so the winner is selected at random.

The alternatives were: to select entirely on ability, or else entirely at random (from a pool of well-qualified applicants).

Their conclusion

“Our findings suggest that the pool of high-performing women who apply for top jobs can be substantially enlarged by the introduction of focal random selection. Consequently, the pipeline for women to leadership positions can be made less leaky without lowering candidates’ performance. Moreover, focal random selection closes the gender pay gap among high performers. In addition, differences between men and women in entering competition caused by gender stereotypes are completely eliminated by randomness. Our findings, therefore, point to the relevance of gender stereotypes as an underlying mechanism of gender gap in competitiveness.”

Not bad! Fix the ‘glass ceiling’ and the gender pay gap with the judicious use of lotteries!

You can read the paper here (no paywall) https://advances.sciencemag.org/content/6/47/eabb2142

Are there measurable benefits in using a lottery to select leaders? A scientific experiment

Short answer: Yes, and no!

Longer answer:

Hubris is a tendency of leaders to hold an overly confident view of their own capabilities and to abuse power for their own selfish goals, sometimes with disastrous consequences for organizations. A major reason for hubris is the rigorous selection process leaders typically undergo. This study proposes a governance mechanism used successfully in history to tackle hubris: partly random selections, which combine competitive selections by competence with lotteries. A frequently voiced concern about the use of lotteries is that it takes no account of the competence of the leader chosen. We propose that partly random selections can mitigate the disadvantages of both competitive selections alone and lotteries alone and reduce hubris in leaders. We conduct a test of this governance mechanism by means of a computerized laboratory experiment. Our results show that partly random selections significantly reduce the hubris of group leaders. [my emphasis]

This is the Abstract from the Report. The full citation is: Joël Berger; Margit Osterloh; Katja Rost; Thomas Ehrmann (2020, May 13) ‘How to prevent leadership hubris? Comparing competitive selections, lotteries, and their combination’ The Leadership Quarterly, ISSN: 1048-9843  http://doi.org/10.1016/j.leaqua.2020.101388 (paywall)

In order to test their theory, this group of Swiss and German scientists conducted an experiment, using a method instantly recognisable to experimental economists (and others, but they are the ones I’m familiar with). Their hypothesis was that a lottery could play a useful part in limiting hubris when selecting leaders.

We conducted a computerized laboratory experiment   ….  864 students of the University of Zurich and ETH Zurich, were randomly selected from a pool of students who had volunteered to participate in behavioral experiments for monetary compensation. Participants on average gained USD 30 for 45 min……The 864 participants were randomly selected into groups of six and randomly assigned to one of three treatment conditions.

Wow! As you can see, this sort of experiment is not cheap, so well done to the guys in Zurich to obtain the funds from the Swiss government to conduct an experiment on lotteries-for-jobs. Note, too, the use of a randomly selected sample and sub-samples. Ok, so it’s students, it generally is in these scientific tests, but for obvious practical reasons.

Briefly, the experiment proceeded thus: A leader for each group were produced by one of three methods. 1. Using a general knowledge test and appoint the top scorer; or 2. Same test, but select at random from the top three scorers; or 3. A simple lottery where every member of the group has an equal chance.

How ‘hubris’ of the selected leaders was measured was complicated, and if you want know, you’ll have to read the article, but it did involve the well-known ‘Prisoner’s Dilemma Game’. It was from this, and 11 pages of statistical analysis of regression models that the conclusion was reached.

Our study follows a pioneering approach to investigate an unusual selection method for appointing leaders in organizations, partly random selection. This selection method has been extensively used in history but has nearly been forgotten. Today, random decisions are considered by many people to be “irrational”. Our study shows that purposeful random selection, in particular combining competitive selections with a random component, is a rational and promising way of recruiting leaders that tackles hubris in overconfident leaders. Our proposal to “draw your CEO by lot” is provocative but may be promising.

Most of the members of this group engage in philosophical discussion, where the merits of a proposal are a matter of persuasive rhetoric. Elsewhere, exhortations to ‘follow the science’ abound, and mere rhetoric is treated with caution. Even calling in aid ‘common-sense’ can be suspect.

This is, I believe, the first time any hypothesis of us Kleroterians has been subject to what has been described as ‘The gold standard of science’. I have another example from Levitt of Freakonomics fame which almost constitutes Science, which I will post about later.

A lottery for top jobs is not such a crazy idea

So says Amanda Goodall in an article in the Financial Times 9 Sept 2020.  You can read the article in full here (dodging the FT paywall!).

http://www.amandagoodall.com/FTRandom2020-09-07_101201.pdf

Dr Goodall of the Cass Business School, London has produced many papers on management and HR. She has tried to promote the idea of Lotteries for Jobs with Margit Osterloh, a Swiss academic.

Amanda tells me “It is a hard one [the idea of lotteries for jobs] to get off the ground. It has been hard to publish our article.”

It is very rewarding to find others in the field working on this form of ‘Local Democracy’ as Elster calls it. There are further developments which I will post here shortly.

Lotteries during Covid-19

Public housing is allocated via lottery in Trinidad and Tobago:

Five hundred applicants from the public housing database moved one step closer to home ownership when they were selected for assessment interviews during the Housing Draw, which was hosted live by the Ministry of Housing and the Trinidad and Tobago Housing Development Corporation (HDC) on Wednesday.

The HDC said the applicants were selected from a database of 180,000.

The National Housing Allocation Policy, which was developed in 2004, and which guides the HDC, is intended to ensure greater equity in the allocation process so that all applicants, once they are eligible for the programme, have an equal opportunity of being randomly selected for the location of their choice.

In addition to modified random draws which account for 60 percent of allocations per community, the Allocation Policy provides for a 25 percent for emergency cases or those recommended by the Minister; 10 percent allocation to members of the protective service and defence force; and 5 percent for the elderly and persons with disabilities.

To be eligible for public housing, applicants must be twenty-one 21 years and over, resident citizens with a combined household income of under $25,000 and must not own any property.

Primitive (innate) ideas on randomisation, divination and lotteries

No-one would accuse the classical Greeks, our heroes of the klereterion, of lacking insight into abstract, nay philosophical concepts. Yet it was not until Pascal & Co. in the 1600s that formalised concepts of Probabilty were established. So we can only speculate that the Athenians knew(?) that a lottery was best for implementing fairness, equal chances, descriptive representation — democratic values — across the citizenry. Even so we surely would never describe them as ‘primitive’?

But what of the widespread ‘folkish’ practise of divination, where some natural random phenomenon is used to decide—a lottery, in others words. This could be to  choose a course of action, or even decide guilt or innocence in trials. Many of its  practitioners would be pre-literate, and in the grip of a range of irrational, some might say primitive religious beliefs. What did they think this ‘lottery’ was doing?
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Welsh Assembly Member proposes Citizens Juries

From the BBC News:

Compulsory Welsh citizen ‘democratic duty’ call

Welsh citizens should be called-up for compulsory democratic service in the same way as “jury duty”, an AM has said.

Conservative David Melding said a second chamber of the assembly should be created for residents to influence decisions and laws.

Mr Melding said introducing a “citizens service” in Wales would help narrow the gap between politicians and the public.

He said it would help keep politicians and officials “rooted”.

The AM for South Wales Central said the growing distance between politicians and the public, and the lack of engagement was “very damaging”.

Speaking on BBC Wales’ Sunday Supplement programme Mr Melding said a “citizens’ service” should be introduced, in a similar way to jury duty, with residents randomly selected to sit on panels, including local health boards to look at how hospitals and GP services are run, and local town and county councils to have their say on new leisure facilities and bin collection changes.
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Strictly Eating Chances: You can’t eat chances? Oh yes you can!

I say this despite David Wasserman’s snide comment on the claims made by us lottery enthusiasts. We would say that where there are more qualified applicants than places available, a lottery’s the thing. Some will then win a place — “eat”— but everyone will benefit by having had the chance of winning.

But what is the value of a chance when you win nothing? Rationally we should conclude that the value of nothing is zilch, zero, nada.

In another swipe at advocates of lotteries for sharing Wasserman comments:

if it makes sense to treat an expectation as a good, it also makes sense to ask whether the value of that good increases the longer it is held by the recipient.

It’s nice to see a bit of sarcasm from a philosopher whose main concern is medical ethics!

Instead, I’d like to take up Wasserman’s challenge, and propose that your ‘expectation’ — your ticket to the lottery — can indeed be made more valuable by spinning out the process.

Take for example the way the TV hit show Strictly Come Dancing (in the US it’s called Dancing With the Stars) operates. They start with a dozen or so stars. Each week they dance competitively, and by a complex process one star is eliminated. Over the next weeks the process is repeated, one ‘loser’ every week until there are three left. It is then decided by a Grand Finale.

I take it as axiomatic the producers know how to give the public good entertainment value. That’s show business!
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Selecting Police (partly) by Lottery

The Long Island Exchange reports that Suffolk County, Long Island, NY (Pop.1.5 mn) Police Department is holding a lottery for the order in which qualified candidates are assessed:

Gregory Hosts Lottery to Rank New Suffolk Police Candidates

(Long Island, NY) Suffolk County Legislature Presiding Officer DuWayne Gregory on March 4 hosted a lottery in which the 3,739 individuals attaining a score of 95 on the written exam to become a Suffolk County Police Officer were ranked in priority order to advance to the next stages of the selection process. The lottery was live-streamed from the William H. Rogers Legislature Building in Hauppauge.

The additional phases of the selection process include a personality and psychological assessment, physical fitness test, medical examination, a polygraph examination and a background investigation.  After the testing and background review are completed, candidates who successfully complete all parts of the selection process will be considered for appointment in the same sequence in which their names were drawn in the lottery.

Suffolk County Legislature Presiding Officer DuWayne Gregory pulls a name at the March 4 lottery in which the 3,739 individuals attaining a score of 95 on the test to become a Suffolk County Police Officer were ranked in priority order to advance in the next stages of the selection process. Gregory hosted the lottery at the William H. Rogers Legislature Building in Hauppauge, from which it was live-streamed. Photo Credit: Suffolk County.
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An old idea re-cycled—babies allocated at random

What a daft notion!

If you want to, you can read the full article here:

https://aeon.co/opinions/if-babies-were-randomly-allocated-to-families-would-racism-end

Now even the visa lottery is unsafe?

According to the NYT,

a small number of giant global outsourcing companies had flooded the [U.S. H1B visa lottery] system with applications, significantly increasing their chances of success. […O]ne of the outsourcing companies applied for at least 14,000.

What has happened to the ‘sanitizing’ effect of the lottery?

Does it matter that well-resourced companies ‘game’ this lottery?

[‘Outsourcing‘: A practice used by different companies to reduce costs by transferring portions of work to outside suppliers rather than completing it internally. (investopia) In the UK this practice is known as ‘sub-contracting’.]