21 February 2007

Internalizing an externality (1)

CABAGIS, one of the few readers of this blog, has an interesting suggestion -- definitely more than two-cents' worth -- regarding the congressional intrusion in the appointment of permanent teachers.

Maybe there's a way of accomodating "some" of the people a Congressman has on her/his list without allowing them to completely hijack the process. We need to recognize and reward talented teachers but meritocracy is not the only answer.

I am sure for example that affirmative action policies in the U.S. have generally improved the lot of those who embraced it. I'm thinking along the same lines here.

Say you allocate Congressmen 5 of the 100 permanent items that become available for their region. You then put the criteria they only endorse teaching staff for areas deemed to be disadvantaged in the region. With a quota and criteria in place, you are taking some pressure off the Congressman for doing favours for her/his constituents.
I hope I still get my economics right, but what we have here is an effort to internalize (by providing for the 5% congressional quota in the DepEd hiring policy) a negative externality (the current practice of congressional intrusion in the recruitment process that harms the majority of teacher applicants).

It seeks to do so by a command-and-control state policy through regulation that limits such intrusion to a maximum of 5 percent.