Detour

Chris Silvey

This is Memorial Day weekend here in the good ole US of A. The unofficial beginning of summer, and for most people a three day weekend that many try to extend to a four or five day weekend by leaving work early on Thursday or Friday. The question around most offices the week before Memorial Day, Labor Day, 4th of July, etc. is always the same… ‘what are you doing this weekend?’ A good majority of the time my response is ‘nothing’, which usually leads to looks of surprise and pity. I don’t care, I like doing nothing…I’m good at it and it brings me happiness.

It is my impression that many people feel the need to do something over three day weekends simply to be able to tell others they are not losers with no plans. They organize weeks ahead of time, spend buckets of money, and advertise to the world what fun stuff they have planned. All for what? I think many of these people have a fear that others will think less of them if they don’t have plans over extended weekends. They fear getting the look s I get when I say ‘nothing’. Why? Save your money, go to the coffee shop and read the paper or a good book, spend an entire day in your pajamas writing blog entries or playing Warcraft, recall that wonderful quote in the movie Office Space by Peter Gibbons…(paraphrase) “I did nothing yesterday and it was everything I dreamt it could be”…with a smile on his face.

I’m doing nothing this weekend….and I couldn’t be happier.

Chris Silvey

My God!

Link added on the strength of one post….

Economic Majors Soliloquy

To attempt a PhD, or not to attempt a PhD:
That’s a really good question.
Whether ’tis advisable to tackle the math
And statistics from outrageous curricula,
Or to accept a lucrative job offer,
And by avoiding those rigours,
Make a good income? To play, to relax:
No more; and by finishing to say we end
The fatigue and social-isolation
That an industrius student is heir to, ’tis a relief
An object of our lust.

Good job David!

My advice…If math gives you pause, then don’t do it. Otherwise, do it.

Chris Silvey

The trade-off between speed of hiring and expected quality of the worker is a common concern for hiring managers and HR staffs. When the decision to hire a new employee is finalized the desire to get the right candidate in a short amount of time for a fair wage is a pipe dream that often will not be realized. Generally there is a trade-off between the speed of a hire and the quality of the candidate. Companies such as Google have hiring processes that seemingly have no end. When I came back to California to look for a job, Google was hiring Financial Analyst…if you check monster.com you will find that they are still hiring for that position, almost five months later. Google is looking for the absolute best candidate, there seems to be no time pressure for the hire. Most companies do not have the luxury of patience that Google does. Many companies aren’t as lucky and need to fill a slot within a finite time frame. If at the end of a month a company doesn’t have the right candidate for the job they have to make a hard decision. Either raise the compensation offered or accept a less then optimal candidate.

Jed DeVaro at Cornell University recently wrote about Recruitment Strategies in the economics journal Economic Inquiry. Dr. DeVaro assumes that the preference between speed and quality remains unchanged by a company during their recruiting search. The only changeable variable is wage; therefore a bad job campaign will lead to a higher wage offered. However, a long campaign does not necessarily lead to a higher wage. A long campaign either indicates a bad campaign or high quality expectations (ala Google). So poor campaigns that go long will lead to higher wages offered, but long campaigns don’t necessarily lead to higher wages due to the high expectation variable. Dr. DeVaro begins to speculate about differing search methods and how they can affect the speed of hiring, and therefore the wage that is offered.

Dr. DeVaro’s paper has left me wondering about other issues. First, I wonder if high quality expectations lead to higher wages. Does Google, or other companies with exacting hiring standards, end up paying more for like candidates then other companies, ceteris paribus? Although the small supply of qualified candidate will certainly raise wage levels there are other variables such as the opportunity to work with other thoughtful and highly talented people that could lead to people willing to work for a depressed wage.

An additional question Dr. DeVaro has left me with is whether a good job campaign will lead to lower wages. As an example let’s assume company X lists a job for one vacancy at $20 an hour and gets hundreds of qualified applications for the position. Would company X ever call the applicants and tell them that due to the enormous response they are changing the compensation down to $10 n hour and hiring two applicants instead? Although this is an exaggerated example can you think of a real world situation where huge response will lead to a reduction in wage offered in the same period. DeVaro thinks it doesn’t happen…does it?

Torabisu

I’m a huge fan of Joel Spolsky. If you are thinking about starting a software company, or work in a software company his perspective is worth at least a semester or two at business school.

Joel just wrote an article where he hammers Wall Street for offering bonds with prepayment options to retail investors. While I agree that brokers are probably obfuscating the interest rate risk… I suspect he is a bit too harsh by implying that these bonds can never be a good deal. Seems to me they’re a great way to allow the market to assign a value to interest rate risk (as long as they’re sold honestly).

I knew this was coming when google weather searches started…not that this was a brilliant insight…

Google Personalized Homepage

Chris Silvey

Before dropping out of the PhD program at Cornell, Zahir was obsessed with the idea that consumers are faced with too many choices and do not like it; an idea that would fly in the face of conventional economic theory. I have heard many people ponder this idea and I find that there is some truth to it (Barry Shwartz from Swathmore has written extensively about this issue in the Paradox of Choice). If consumers can’t easily differentiate between products, then they can’t make an informed choice. This gives the consumer a feeling of discomfort and frustration. The consumer begins to complain about the existence of too many choices and wishes for less variety. I think this is a misdirected wish, what most are really wishing for is the ability to differentiate between the plethora of products available.

My father-in-law has complained about this situation when it comes to the purchase of jeans. Back in the stone(washed) ages, when he was growing up, when you went to the store to buy Levi’s you picked up the 501’s that fit you the best and went to the counter to pay…no variety…no hassle…no problem. Today, there are over 200 varieties of just Levi’s, and that isn’t even taking into account the Hilfiger, Lee, Wranglers, etc. Whenever he rants about there being too much variety I always point out that he shops at Fry’s which has hundreds of thousands of products in one store. He doesn’t mind the variety at Fry’s because he can easily differentiate all of the computer gear available at Fry’s. So variety is not the problem.

Levi’s has recognized that there is an issue with there expansion of product line and is trying to provide a solution. Levi’s has rolled out a machine called the Intellifit at select Levi’s Stores this spring. The Intellifitâ„¢ Body Scanner, in seconds, scans your body (you can be fully clothed for the experience) and finds the most flattering jean in your own size and style made by Levi’s. They are currently touring the scanner to there flagship stores in America and if it is successful will roll out more of the machines on a permanent basis. I hope I get a chance to use the machine when it is in the San Francisco store this month. The geek in me just has to see this in action.

Chris Silvey

There is a phenomenon that happens in Northern California that seems like a ridiculous waste of resources.

Companies hire people to stand on corners and hold a sign for oncoming traffic. These people are on the streets five to seven days a week waving a store sign and dancing to music pumped into their ears by the walkman/MP3 player on their belt. I wonder if this happens in other parts of the country or in other countries. The A frame sign was invented years ago and can be purchased for well under $100. Businesses could use them for weeks, months, or years (depending on the wear and tear the signs gets or the message the business wants to convey). A human has to be employed at minimum wage and will cost over $100 a day (if you include, wage, workers compensation insurance, Social Security taxes, etc.) Why would a business do this?

I think the main reason for the employment of human billboards is that A-frame signs are illegal in most cities in the bay area. The cities try to limit the eyesore that clusters of signs on every corner can cause. The discussion of A-frame sign bans is usually coupled with safety concerns for idiots that might walk by one of these signs and trip over them. As with most things, the politicians who think up these brilliant restrictions exempt themselves from the law (political advertisements are everywhere and completely legal. If you look closely in the picture above you can see a political advertisement in the bushes for a city councilman in Pleasanton. If that had been a sign for pizza the city manager would have sent a threatening letter in a day and would have ripped it out of the ground.). The other special group that is exempt from these regulations is real estate con sales people; they are allowed to put up open house signs on the weekend. Since every person that is selling (or will want to sell) a house is a city resident, the restriction of sales advertisement would be impossible to impose on the citizenry. Since business owners aren’t usually city residents, they can’t exert the power of their vote to stop inane regulations from being enacted.

The regulations usually go on to stop other attention getters like large signs, balloons, etc. However, the city can’t regulate free speech. That one is in the US Constitution and is non-negotiable for city and local governments. So businesses exploit this weakness in the city’s ability to regulate by paying a person to hold up a sign on the street corner. Sheesh!

Chris Silvey

I am sure you can infer all of my answers to this test from this score…

Your Moralising Quotient is: 0.00
Your Interference Factor is: 0.00
Your Universalising Factor is: -1.00

Jacqueline Passey said she didn’t agree with the premise of the brother/sister question…Hey Jacqualine did you read the instructions?

Rule # 2: The activity asks you to make judgments about a number of scenarios. You need to treat these as if they are descriptions of real-world events - and respond accordingly. In other words, what we’re interested in here are your judgments about the events precisely as they are described in these scenarios (not as you think they would actually occur in the real world).

On the chicken question I said it

would

disturb me to watch…but what he and the dead chicken does in their bedroom is their business (assuming dead chickens aren’t harmed by the lack of consent to the action in the bedroom…the consent to be killed is another question altogether. One that I struggle with often).

It is actually shocking to see soo many people have such judgmental scores. I know I shouldn’t be shocked, but I can usually get away with pretending that people are more permissive then they actually are.

Chris Silvey

Adora and Craig Newmark both have links to The Complete List of the 1,000 Top U.S. Schools by Newsweek. Adora went to two of the high schools on the list (#18 and #155)…Newmarks Door writes…

…the school my wife teaches at and my younger daughter attends–ranked ninth best high school in the U.S. by Newsweek

I guess my school coming in at 1035 with subsidized lunches provided for 83.4% of the students (twice what is considered poverty level) isn’t so hot. That ’splains a lot! But I guess I already knew my school wasn’t Beverly Hills High School.

Chris Silvey

Commencement Address to Economics Graduates by Bob McTeer

Your economics training will help you understand fallacies, non-intuitive outcomes and unintended consequences. In fact, I’m inclined to define economics as the study of how to anticipate unintended consequences. Most fallacies in economics probably are fallacies of composition. For the benefit of your little brothers and sisters, let me give an example of the fallacy of composition. You may be able to see better if you stand up—but not if everyone stands up. What’s true of the individual may not be true of the whole. Keynes’ paradox of thrift provides a currently relevant example: Individually, most consumers need to save more. But if all or many consumers start trying to save more, the economy will be in deep doo-doo. Doo-doo is a technical term that economists use.

Link stollen from Craig Newmark.