Professor Dilip Soman named Canada Research Chair

Rotman researcher studies how businesses, people make decisions

Professor Dilip Soman named Canada Research Chair

Most people say that the elevation of Mount Everest is 29,000 feet, forgetting the final 29 feet. During the last 29 feet is when the bad things occur — people fall prey to physical exhaustion, give up mentally, and get caught. People often put in a lot less effort at the end compared to the hard work and preparation that has led them to these last steps.

Similarly, most companies spend much of their effort on at the beginning, from the product design, brand strategy, and optimization of the production process in the hopes of putting out the best product on the shelves. Companies often forget about the final step, where customers enter the store and talk to a salesperson or click a website, to make the choice of whether to purchase the product.

This irrational shortcoming of human behaviour is what caught Professor Dilip Soman’s attention.

In 1992, Soman began his PhD program at the University of Chicago where he focused on marketing and management. However, he was drawn to the implications of consumer behaviour on the market and decided to delve into the field of behavioural economics: the study of how cognitive and emotional factors affect the decision-making processes of individuals and institutions.

Twenty-seven years later, Soman is the Director of the Behavioural Economics in the Action Research Centre at Rotman (BEAR) and serves as a Senior Policy Advisor on the Impact and Innovation Unit for the Government of Canada, while fulfilling his teaching duties at the Rotman School of Management.

“So much [of behavioural economics] I think is interesting because it says that there’s a deviation between what people want to do and what they end up doing,” Soman told The Varsity.

Now, Soman holds the Canada Research Chair in Behavioural Science and Economics. The Canada Research Chairs Program aims to help chairholders launch Canada into the forefront of research and development.

Making choices easier

The presentation of choices to individuals and consumers can impact their decision-making. Different designs can either facilitate action or impede it. “As a behavioral scientist, my contribution is that I can help consumers — you must see that and I can help organizations see that,” said Soman.

He went on to explain that, “People are impulsive, people don’t think too much about the future. They’re emotional. Anything in the context that exaggerates those tendencies tends to make people deviate from what they should do.”

Small and seemingly irrelevant details that make a task more challenging often make the difference between doing something and putting it off. Opting out of email subscription lists appears to be a menial task that will declutter our inboxes and make our lives a little bit easier, but because it is so complicated and inconvenient many people stay subscribed to email lists.

It is easy to see this tendency for people to deviate from what they intend to do becoming a lot more problematic — think retirement saving options and health care plans. When choices are confusing and require more effort to understand, people tend to stick with the default, even if it does not benefit them much, or at all.

Soman’s work consists of developing tools to help government officials and businesses create architecture that guides individuals to make choices that are in their best interests. It has a heavy focus on bridging the gap between the ideas of behavioural economics and how to practically implement those ideas in a real-world setting.

Soman’s work at the BEAR is a prime example of his contributions toward converting academic ideas in behavioural science to implementation-oriented framework.

“Our biggest work is in scaling what we know in the lab to the marketplace… with the goal of shifting the research agenda in behavioural science from the big ideas to where can we use it and how,” said Soman.

On being a Canada Research Chair

The Varsity asked Soman what it means for him to be named the Canada Research Chair in Behavioural Science and Economics, a prestigious title awarded to Canada’s most outstanding scholars.

Rather than reflecting upon his personal achievements, Soman viewed his appointment as a larger recognition of the field of behavioural economics.

“I think it’s more a recognition for the field… [that] this is the first candidate chair at the intersection of Behavioral Science and Economics,” said Soman.

Whereas the government has worked with an economic assumption of citizens’ decision-making when drafting policy, Soman believes that his appointment as the first Canada Research Chair in the field of behavioural economics marks a changing attitude towards the idea that people are not always rational actors.

“That’s a big acknowledgement for the fact that the field is now not only considered legitimate, but that it can impact society,” said Soman. “I think once there’s a Canada Research Chair in behavioural economics… all [of the] ideas of our team are now much more easily received.”

On what’s next

Soman wants to do more than understand the existing friction organizations have in place that prevents individuals from making good decisions — he wants to reduce it by applying the tools of behavioural economics to the complex problems of the real-world.

His main priorities for the upcoming years include converting academic findings into accessible information that businesses and individuals can digest; incorporating the ideas of behavioural economics toward a preventative health system; and improving the financial literacy of average citizens by using smart choice architecture to help people make better economic decisions.

Despite being an expert in understanding human imperfections in decision-making, Soman is the first to admit his shortcomings. He is currently working on his latest book, About Time, but when The Varsity inquired about the book, Soman confessed that he hasn’t had the time to work on it yet.

“I mean, one of the reasons I studied this stuff I’m doing is I’m pretty bad myself,” joked Soman. “I procrastinate.”

Saving the Great Lakes from ecological disaster

The consequences of climate change on our largest freshwater system

Saving the Great Lakes from ecological disaster

As summer approaches, students are exchanging their scantrons for swimsuits and pencils for popsicles. For many, summer plans will involve the Great Lakes.

The Great Lakes are an epicentre of recreational, economic, and ecological activity. 9.8 million Canadians, about a third of our country’s population, rely on them. Carved thousands of years ago by retreating glaciers, the Great Lakes are a unique ecosystem housing a fifth of the world’s freshwater.

However, concealed by the rolling waves and the glassy surface of the lakes is evidence of environmental damage caused by humans over the last few centuries.

We have not always been kind to the Great Lakes. Heavy human use of the lakes has resulted in habitat loss and fragmentation, the introduction of invasive species, and environmental pollution. The invasion of zebra mussels and clouds of green algae blooming from phosphorus runoff are just two consequences of human activity to make headlines.

More than 3,500 species of plants and animals call the Great Lakes home, and for some, this is the only place where they can exist. Faced with the growing consequences of climate change, the Great Lakes system is coming under even more stress and is possibly reaching a tipping point.

The Environmental Law and Policy Center report

In March, the Environmental Law and Policy Center (ELPC), an American non-profit advocacy group, released a report detailing the effects of climate change on the Great Lakes.

Although it is widely understood that the consequences of climate change – like rising temperatures and more extreme weather events – will affect everyone, this report also detailed specific consequences for those who live in the Great Lakes region.

Increasingly severe weather patterns will bring hotter, drier summers to the area, causing heat waves. They will also bring wetter springs and winters, which will trigger flooding and increased water flow.

From the early 1900s to 2015, the Great Lakes region experienced a 10 per cent increase in precipitation, compared to the rest of the United States, which had only experienced an increase of four per cent.

“We’re seeing more and more of these… powerful wind storms, rain storms, [and] thunderstorms in the summer, and more milder winters for sure,” said Dr. Harvey Shear, a professor of geography at UTM, who teaches courses on the Great Lakes.

However, the ELPC anticipates that by 2100, the Great Lakes region will have less moisture in the summer, leading to fewer periods of intense precipitation at the start of the season.

Intensifying heat will bring about more days with temperatures above 33 degrees Celsius. By 2100, the ELPC report predicts that the Great Lakes region will experience an additional 30 to 60 days of such temperatures per year.

These intensified patterns of precipitation and hotter temperatures will translate into devastating consequences for the environment and our society. Shortened growing periods, increased disease, and the rising prevalence of waterborne pathogens will directly affect humans.

Nothing new

While it may seem like a shock to find that the Great Lakes region will experience such severe changes in the near future, researchers are not surprised by some of these consequences.

“We have modified the Great Lakes over the last 400 years to the point where they’re almost unrecognizable from what we would have seen if we [went] back in time,” explained Shear.

A case in point is the St. Lawrence River, which has been carved out to accommodate human activities since 1680. Construction began for the St. Lawrence Seaway in 1954 to directly connect the Great Lakes to the Atlantic Ocean. The $470.3 million seaway enabled cities like Toronto and Chicago to expand their commercial shipping industries, bringing in more than $6 billion USD per year to the Great Lakes region.

However, the seaway’s completion resulted in the decimation of the system by invasive species like sea lampreys. Sea lampreys are circular-mouthed fish with hooked teeth that attach themselves to native fish, feeding on their bodily fluids and abandoning them to succumb to their wounds. During their parasitic stage, lampreys kill approximately 40 pounds of fish over 12 to 18 months.

Spiny water fleas, zebra mussels, and other invasive species have also found their way to the Great Lakes system through shipping freighters. When taking on water in their ballast tanks, which are designed to stabilize vessels that are unloading or taking on cargo, these ships will also take on waterborne invasive species. Zebra and quagga mussels, in particular, are known for clogging water intake pipes and being costly to remove.

As temperatures continue to rise, native inhabitants of the lakes will endure added stress from an ecosystem where they are already competing with their non-native neighbours, likely forcing these species to shift to more northern regions.

These concerns are not new — the original 1971 edition of Dr. Seuss’ children’s book, The Lorax, referenced the dire state of Lake Erie. In the 1930s, runoff from fertilizer and waste from humans and animals introduced phosphorus into the lake. Annual phosphorus input soared from about 3,000 tons in 1800 to 24,000 tons in 1960, after the introduction of the mineral in cleaning agents after World War II. The high phosphorus levels caused an overgrowth of algae, clouding the water and killing off other species in a phenomenon known as eutrophication.

State and provincial governments around Lake Erie took action to limit the addition of phosphorus to soap, and began working with local farmers to reduce the amount of phosphorus input by more than half. However, new sources of phosphorus appeared in the 1990s, returning phosphorus levels in Lake Erie to previous conditions.

These algal blooms are more than an eyesore. A species of cyanobacteria called Microcystis causes such harmful algae blooms by producing a toxin called microcystin. The toxin can cause diarrhea, vomiting, and in high enough quantities, liver failure in humans.

Microcystis gripped Toledo, Ohio in 2014, when Lake Erie was subjected to two harmful algae blooms that year due to a one-two punch of increased precipitation and warmer temperatures. The toxin overwhelmed the city’s water filtration system, leaving half a million residents without clean water for three days.

Not all strains of Microcystis produce this toxin, but researchers have found that warmer growing conditions have increased the prevalence of the toxic strain, suggesting that this phenomenon could become more prevalent in the future.

Although some of these consequences listed in the ELPC report are not a result of climate change alone, climate change could worsen their effects in the coming years.

The looming storm

The consequences of climate change are not so far off. Shear noted that significant shifts can happen quickly within a year or two, intensifying extreme weather events.

“With climate change you’re dealing with very long-term changes over decades which makes it easy to attribute extreme weather events to normal year to year variation,” said Shear.

A more tangible consequence of the changing climate, continued Shear, is the uptick of unpredictable weather events, such as violent wind storms. In fact, climate change may have caused the Toronto Islands and the Harbourfront to flood in spring 2017

Shear further explained that we have hardened the surfaces of urban areas with hectares of paved roads and roofs that don’t absorb water. “So when it does rain, there’s nowhere for the water to go but straight into the streams and into [the] lake.”

“[The] Lake Ontario water level was fairly consistent,” he continued, “and then the water level began to rise because of the rainfall and snowmelt… that [had] nowhere to go.”

Concurrent flooding in Montréal, due to extra water in the Ottawa River and St. Lawrence Seaway, denied the officials the option of draining Lake Ontario into the sea to lower the water level.

Although the islands reopened later that summer, visitor attendance was down for the rest of the season, costing the city approximately $5 million in lost ferry revenue, in addition to costs from property damage.

That 2017 flood should be a sobering sign that the Great Lakes will not stay the way they are for very long.

Economic damage

Viewing environmental damage through an economic lens helps put the consequences of changing conditions into perspective. The Great Lakes provide over 1.5 million jobs and generate $60 billion in wages annually for local workers. The regional economy of the Great Lakes system is valued at $6 trillion, which is more than the GDP of countries such as Japan, Germany, France, and the United Kingdom.

With the prospects of decreased employment, damaged infrastructure, and forgone revenue, it raises the question of whether or not we are willing to lose an ecosystem that benefits local economies so much. It’s not that the Great Lakes will cease to exist, but that the system will cease to be a sustainable habitat for not only plants and animals, but for ourselves as well.

Starting change

Seeing the consequences of our past actions shows how much of an impact our behavior can have. But how can we begin to undo the damage that we have done?

Canada and the United States have pledged to reduce the amount of phosphorus in the Great Lakes by 40 per cent by 2025. However, this goal has proven to be tougher to match now than it was in the past. Unregulated farms, dissolved phosphorus, and different phosphorus sources causing the algal blooms have made it harder for the countries to meet their targets. With the added threat of rising temperatures, the threat of algal blooms is imminent.

The Ontario Great Lakes Strategy 2016 progress report outlined the collective efforts of the government, scientists, Indigenous peoples, and private-sector organizations to work toward returning the Great Lakes to a state where they are not at risk of ecological collapse. However, governments have yet to impose hard-hitting restrictions on certain behaviours such as the use of phosphorus by the agriculture industry.

In 2018, then-Ohio governor John Kasich signed an executive order to restrict agricultural runoff, which contributes to algal blooms, by setting requirements for how nutrients in animal waste and fertilizer should be stored.

But government intervention isn’t the only source of change in our society. Organized groups of concerned citizens have a created huge impact on these pressing matters.

According to Shear, citizen activism has led to eradication of all sources of mercury in the Lake Superior Basin and to the cleanup of the Love Canal disaster in New York in the mid-twentieth century.

Love Canal was the site of a failed energy project that became a landfill, which was eventually buried and sold to the city for development. Decades later, chemicals began to seep up through the ground, exposing the region’s residents to carcinogens and teratogens, which are implicated in deforming embryos.

“It was citizen activism in Niagara Falls, Ontario that linked with citizen activists in Niagara Falls, New York that really brought [the provincial, state, and federal governments] to shut down Love Canal… to prevent the contamination of the Niagara River,” said Shear. “So citizen activism can really work.”

In building our cities, we did not plan to bring harm to our environment. Rather, we were careless and uninformed about how our actions could damage the very home we live in. As we learn about why these ecologically devastating events occur and how human activity causes them, we must take action to prevent further damage and restore what we can.

We could otherwise negligently trek forward and continue to make decisions that harm not only ourselves, but those who will come after us.

Rosa Luxemburg: living flame of revolution

Toronto New Socialists host Professor David Camfield

Rosa Luxemburg: living flame of revolution

In the late afternoon sun on February 10, the Toronto New Socialists welcomed Professor David Camfield to speak on socialist revolutionary Rosa Luxemburg. Slight and soft-spoken, with a ring of curly hair haloing a narrow face, Camfield teaches in the Department of Labour Studies at the University of Manitoba. He is also the author of the academic books We Can Do Better: Ideas for Changing Society and Canadian Labour in Crisis: Reinventing the Workers’ Movement.

The audience, mostly middle-aged, sat on fold-out chairs. A man in a Democracy Now! ballcap shook hands with everyone around him, and others called greetings to one another across the room. The person who sat next to me turned and asked if I was involved in any organizing.

A hundred years after Luxemburg’s murder, I was glad to spend an afternoon discussing her life, ideas, and continued relevance today.

Luxemburg’s life

The event began with a land acknowledgement, then flowed into Camfield’s introduction. He briefly outlined Luxemburg’s life and her role in the German socialist movement. Rosa Luxemburg, he explained, was a leading figure in the dominant Social Democratic Party of Germany (SPD), until the outbreak of World War I. It may seem anachronistic, but the SPD was the greatest socialist success of the early twentieth century prior to 1917. In fact, in 1912, it captured 34.8 per cent of the vote to become the largest party in the country.

Luxemburg, who held a PhD in economics, was an influential speaker, organizer, and theorist of the booming German socialist movement. Her major economic work, The Accumulation of Capital (1913), examined the intrinsic connection between capitalism, nationalism, militarism, and imperialism. She was committed to revolutionary principles, and as such led the radical wing of the SPD. She frequently clashed with the reformists, especially future party leader Eduard Bernstein, who hoped to achieve gradual changes while maintaining the existing capitalist system.

These ideological schisms deepened as war preparations began in Germany and the country tilted ever closer to outright militarism. In the German parliament, where women were not able to vote, Bernstein’s SPD voted to approve the war. Devastated, Luxemburg rightly recognized Bernstein’s and the SPD’s support for the war as an enormous betrayal of principles and left the party. In response, she helped found the Spartacus League, which was dedicated to revolutionary struggle and systemic overthrow — not Bernstein’s policy of compromise.

Luxemburg was heartbroken by the division of proletariat and the turn toward nationalism instead of the international solidarity of the working class. She protested fiercely against the war and was arrested in 1916 for her agitation. She spent the duration of the fighting in prison.

After the war ended, Luxemburg continued to work with the Spartacists, who grew increasingly frustrated with the stumbling Weimar government. Without her foreknowledge, some Spartacists launched a premature revolt in Berlin in 1919. Though she recognized the time was not yet right, Luxemburg took to the streets.

Leaders of the reformist SDP responded by unleashing the Freikorps, a proto-Nazi gang of thugs, to subdue the crowds. They murdered Luxemburg in the street on January 15, 1919.

Lessons for today

Our world today, Camfield reminded the audience, is markedly different than that of Luxemburg’s. As such, some aspects of her analyses are absolutely temporally bound. For one thing, capitalism today is vastly different than it was in the early 1900s. Unions and left-wing political organizations were robust and relatively powerful in early twentieth century Germany, unlike today, where the contemporary power of unions has been drastically co-opted by bureaucratization and far-left political parties are relatively sterile. Nevertheless, posited Camfield, Luxemburg’s writings and theories still contain some relevance for the twenty-first century.

He narrowed this into five main points.

First, he said, Luxemburg’s theory that capitalism leads to complete social breakdown — with a final stage of intense regression and destruction — is clearer than ever: our world is literally melting from climate change, as driven by corporations.

Second, an advanced society with cooperative production is entirely possible and compatible with democratic principles.

Third, leftists must also remember that the start of a new order requires a social revolution — not gradual change. Real change cannot happen under capitalism, he reminded listeners, and reform will always be handicapped by the system that created it.

Fourth, this social revolution must be precipitated by a massive process of self-emancipation: in other words, the revolution must be led from below, not above.

Finally, Luxemburg’s commitment to internationalism rings particularly true today, when ultranationalism is rising and countries close their borders to migrants.

Rosa Luxemburg shouldn’t be deified, but neither can we afford to forget her. 

Editor’s Note (February 26): This article has been updated to clarify the contents of Camfield’s statements and the breadth of his academic work. 

Income disparity in youth sports

Why the ultimate meritocracy no longer exists

Income disparity in youth sports

Sports are often heralded as the ultimate meritocracy — a realm where talent and hard work supersede the institutional barriers that tend to marginalize minority populations. Some of the most popular athletes in the world today like LeBron James, Serena Williams, or Conor McGregor have reached superstardom despite their humble beginnings.

The popularity of these athletes is not only fuelled by their outstanding performances in their respective fields, but is also contingent on the struggles that they faced throughout their journey.

There is something about an underdog story that resonates with sports audiences. We love to hear about a kid succeeding against all odds and earning a place among the top athletes in the world, because the notion that all it takes is hard work to prevail embodies the American dream.

However, these stories are likely to become few and far between as income disparities slowly but steadily plague the realm of youth sports.

Youth participation in sports dropped from 41.5 per cent in 2011 to 37 per cent in 2017. While that’s not a devastating drop, it shows a steady decline of interest. And before we get out our pitchforks and blame Fortnite and social media, there is another important statistic to consider when it comes to youth sports.

Although youth participation in team sports is down across the board, youth participation in families earning less than $25,000 yearly dropped eight per cent, while youth participation in families earning $75,000 or more increased by three per cent.

Of course, there may be a myriad of factors that explain the decline of youth participation in poorer families, but one of the most important reasons involves the commercialization of youth sports over the past decade.

Youth sports as an industry is currently valued at around $15 billion, which is $3 billion more than the value of the New York Yankees, Dallas Cowboys, and Los Angeles Lakers combined.

Needless to say, that is a lot of money.

The industry has benefitted from an increased popularity in some sports, including soccer and basketball, which has led, in part, to inflated athlete salaries and made professional sports a more lucrative career path than ever before.

In addition, sports have become an avenue for scholarships, with students receiving full-rides to world-renowned institutions based on their athletic capabilities. As a result, parents have been clamouring to enroll their children in as many sports programs as possible to ensure their success in the future. While I don’t believe these parents should be blamed for trying to help their kids, one has to understand how this advantage is reached.

First, we have to consider how youth sports have changed. It is no longer a local coach gathering kids from the community and coaching them at a nearby public field. Instead, youth sports are filled with professional coaches, training facilities, state-of-the-art equipment, and inter-city travel.

All of these upgrades have dramatically increased the cost of enrolling children in sports activities, often driving the price range out of the reach of lower-income families. In turn, these children are less likely to excel in sports, while more privileged children have the opportunity to thrive in a sports environment. This widens the wealth disparities in sporting societies and perpetuates class inequality.

This is especially problematic because ideally, sports should herald standards of equality, where one’s background is irrelevant, and talent trumps all other factors. However, in this current conception of youth sports, raw talent is irrelevant if children don’t have the necessary grooming and conditioning that top-ranked coaches are looking for.

The commercialization of youth sports is detrimental to children of poorer families, not only because it restricts their access to collegiate sports scholarships and the world of professional sports, but also because it hinders their chances of learning crucial life skills through sports.

Skills such as discipline, determination, and teamwork have numerous real-life applications and can determine success for a child in all areas, but with certain children missing out on these lessons, their skills and likelihood to succeed suffers beyond physical activity.

This is evidenced by 70 per cent of children completely abandoning sports by the age of 13, which is typically the age when the youth sports industry accepts serious applicants. Training however begins as early as six years old.

The solution here is not simple, as children in  more privileged families are likely to always have an advantage, by virtue of the fact that wealth gives them more opportunities to improve their skills.

However, our job as a society should be to even the playing field by funding programs for underprivileged youth that give them access to similar facilities as children in top-ranking youth sports programs. All children deserve equal opportunities to learn and grow, in sports and in life.

How does Uber affect public transit usage?

U of T economics prof publishes study in Journal of Urban Economics

How does Uber affect public transit usage?

Uber’s presence in major cities is prompting growing concerns among residents, particularly over how the ridesharing tech giant impacts the urban landscapes in which it operates. Issues from taxi drivers’ job stability to Uber’s effects on public transit usage have largely yet to be properly addressed.

To begin to understand Uber’s impact on cities, Jonathan Hall, Assistant Professor in U of T’s Department of Economics, recently published a study in the Journal of Urban Economics examining the relationship between Uber and public transit.

The paper, entitled “Is Uber a substitute or complement for public transit?,” aimed to find whether Uber’s entry to a city makes public transit ridership increase or decrease.

This could be essential information for cities planning transportation budgets and for predicting traffic density. Most importantly, according to the paper, “if Uber increases transit ridership this would then increase the efficiency of the public-transit system.” This could lead to lower costs for the transit agency and shorter ride times for commuters.

Hall and his co-authors, Craig Palsson and Joseph Price, used Uber penetration data and data from the National Transit Database, which records every transit ride of nearly every transit agency in the United States. This data is collected from 196 Metropolitan Statistical Areas (MSAs) in which Uber operates.

Hall and his colleagues concluded that Uber is a complement to public transit, rather than a replacement. Two years after entry, Uber’s presence can cause a growth in transit ridership of up to five per cent.

The reason for this complementary effect can be found in part in the faults of public transit. As per the paper, “It is Uber’s ability to fill in the holes in public transit coverage, substituting for particularly bad transit trips, that allows Uber to complement transit overall.”

Often, the majority of time taken during short-transit trips is taken up by getting to and from the station. Uber’s ability to eliminate these first and last portions of a transit trip to efficiently complete the main portion allows the two services to be complementary of each other.

The effect, however, is not consistent across transportation methods or environments. The paper explained that “Uber reduces transit ridership in smaller MSAs while increasing ridership in larger cities.” As such, the development of policies regarding Uber should consider the preexisting state of public transit in a given city.

Furthermore, there is a difference in the impacts between transit ridership for rail and bus. In an interview with The Varsity, Hall said that this was the most surprising result of the study. “What I thought we’d find is that Uber hurts buses and helps trains… because buses are slow [and] usually bus trips are shorter compared to train trips.

“The logic is very compelling to me. But that’s not what we found and they don’t let you make it up,” said Hall. Instead, Hall’s research found that Uber’s impact on train and subway usage is inconsistent across different locations.

The major limitations of the paper are in the timeliness of its results. According to Hall, “transit ridership in the US is falling. It’s falling as though there’s a recession — there’s not a recession. So, blaming Uber seems like a natural place to start. Our study finds that is not the case. But our study… doesn’t go to the present day.” This specific issue is inevitable, as data is rarely available contemporaneously.

Although it is difficult to know what is truly causing this current decline, Hall’s paper will help shape future discourse around innovation in transit and its impact on urban environments.