Trigger warning: contains some academic economics palaver and self-promotion.
Classical economics arguments
The case (as in ‘no Lean Season’) seems to depend on inefficient behavior/job applicants leaving money on the table. If there were such great gains to negotiating why wouldn’t the applicants always hire a negotiator? This lends some credence to those saying that there is a cost in terms of rescinded offers. In some sense, this would mean that if the EA community offered free negotiating services in exchange for such a pledge, they would be gambling with the applicant’s funds.
*So what might be the case to still justify this?*
Behavioral and modern economics/psychology
1. Psychology/biases in giving
This is not necessarily a bad thing. If the applicant is willing to take such a risk, this might be a good way to indirectly elicit donations. It also relates to the give if you win mode I have been researching.
2. Biases in negotiating
This also might be a ‘nudge towards negotiating’; perhaps people are reluctant to stick their neck out and negotiate for themselves because of some intrinsic psychological bias, but they might be willing to do so with the support of the EA community, and knowing that it would lead to helping effective causes, well bringing them some positive reputation in the process.
3. Psychology and ‘biases’ in volunteering
This may unlock the volunteer services of expert negotiators in a particularly effective way. Because of the signaling benefits (it’s more public!), corporate rewards, and internalised feeling of impact people may be more willing to volunteer than to donate the equivalent amount in terms of the value of the time. This relates to my proposal for the Corporate bake sale.
4. Synergies enabled by cooperation between altruists
In Principal-Agent problems there is a well-known inefficiency that results from the combination of hidden information and either limited-liability or asymmetric risk-preferences. This is essentially why economists believe (and have some evidence) that real estate agents usually get a lower price when they sell a house for someone else vs. their own house.
However, if the negotiator here is EA-aligned, their interests will better converge, and there is an efficiency gain to be had here. (A bunch of papers make this case … about the efficiency gains resulting from altruism on one side or the other, including my own paper on the theoretical argument for ‘fair trade’.
Trigger warning: contains some academic economics palaver and self-promotion.
Classical economics arguments
The case (as in ‘no Lean Season’) seems to depend on inefficient behavior/job applicants leaving money on the table. If there were such great gains to negotiating why wouldn’t the applicants always hire a negotiator? This lends some credence to those saying that there is a cost in terms of rescinded offers. In some sense, this would mean that if the EA community offered free negotiating services in exchange for such a pledge, they would be gambling with the applicant’s funds.
*So what might be the case to still justify this?*
Behavioral and modern economics/psychology
1. Psychology/biases in giving
This is not necessarily a bad thing. If the applicant is willing to take such a risk, this might be a good way to indirectly elicit donations. It also relates to the give if you win mode I have been researching.
2. Biases in negotiating
This also might be a ‘nudge towards negotiating’; perhaps people are reluctant to stick their neck out and negotiate for themselves because of some intrinsic psychological bias, but they might be willing to do so with the support of the EA community, and knowing that it would lead to helping effective causes, well bringing them some positive reputation in the process.
3. Psychology and ‘biases’ in volunteering
This may unlock the volunteer services of expert negotiators in a particularly effective way. Because of the signaling benefits (it’s more public!), corporate rewards, and internalised feeling of impact people may be more willing to volunteer than to donate the equivalent amount in terms of the value of the time. This relates to my proposal for the Corporate bake sale.
4. Synergies enabled by cooperation between altruists
In Principal-Agent problems there is a well-known inefficiency that results from the combination of hidden information and either limited-liability or asymmetric risk-preferences. This is essentially why economists believe (and have some evidence) that real estate agents usually get a lower price when they sell a house for someone else vs. their own house.
However, if the negotiator here is EA-aligned, their interests will better converge, and there is an efficiency gain to be had here. (A bunch of papers make this case … about the efficiency gains resulting from altruism on one side or the other, including my own paper on the theoretical argument for ‘fair trade’.