Saturday, November 21, 2009

My PhD Friend's Theory


Since launching this blog a few weeks ago, I've discovered that the most loyal readers from my modestly sized audience are (1) my mother, (2) other family members, and (3) fellow economics classmates. I recently was delighted to get an email from a friend and former classmate who is currently getting his Economics PhD at one of the world's most prestigious schools. He wanted to pass along the "jist" of a nifty labor economics model he's been working on for describing "shirking" behavior in relationships. Here you go:

It takes effort to do a job correctly, and because effort is costly, sometimes individuals will "shirk" under certain conditions. When an individual shirks, he/she knows that sometimes he/she can get away with it. (If this were not the case, surely we would NEVER check Facebook, ESPN, or our blogs while we're at work. . . . )

Anyways, let:
w = wage
c = cost of "effort"
p = the probability of being caught shirking

If our bosses want us to NOT SHIRK, they should be sure that our expected earnings from shirking are less than our expected earnings from doing a good job. Therefore, they should set the parameters, w, c, and p, such that:

(expected shirker wages) < (non-shirker wages)
w(1-p) < w-c
w> c/p

In a dating context, if we want our partner to avoid being a slacker in a relationship, we should do the following:

INCREASE W
- Most of us like it when our s.o. says nice (sincere) things to us, helps out around the house, takes care of us, and is nice to our family members and friends. This one's a no-brainer.
INCREASE P (but not too much)
- Stand up for yourself if your s.o. skimps on R-E-S-P-E-C-T, but don't choke him/her with excessive monitoring ("stalking"). Let them enjoy their guys' nights/girls' nights in moderation, but don't let them walk all over you either.
DECREASE C
- I once heard a girl complaining about a guy taking her to a "chain restaurant" (I think it was Olive Garden or Red Lobster) on a date. Waaa, waaa!!! (BTW-does that make me unclassy for liking those kinds of restaurants??) If you're too high-maintenance, it will be a lot cheaper for your s.o. to walk away than to put up with you. We can't always blame a high-maintenance s.o., though. If we are "too" invested in our work, sports, or other people, we make it more costly for ourselves to put other things on hold and focus on our relationships.

This model is just a start--any other ideas, readers???

(Many thanks to my PhD friend for putting this model together!!)

2 comments:

  1. The English Grammar Demon in me says you probably mean "hereafter" rather than "heretofore" on the s.o. ;-) (now that the demon is appeased)

    Ineteresting idea. I think p would be more a combination of monitoring (m) and the riskiness of the behavior, so p = m(r)? If someone at work decides to watch the game on the bigscreen in the lounge while on duty, it hardly takes a draconian supervisor to notice, much like asking another person on a date while in the room with your current s.o. would get you the boot, and fast. I suppose r is the value the shirker is trying to maximize without getting fired. But for the purposes of adjusting the variables from the monitoring party's side, I guess it doesn't make much of a difference, as you are trying to raise p by increasing your monitoring function(shrug). I guess the big thing is that if you are pretty certain you have a good w, p(or m-function), and c(your part at least) then if the other party shirks big time, you just revealed them as someone who isn't worth it; So, I guess it is kind of important to get those variables pretty close while dating, before you get yourself more committed.

    P.S. Class isn't a measure of how much you want to spend money, so no, that doesn't make you unclassy.

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  2. Thanks for the input, Candenri! (Oh, and I corrected the type-o. . . . my bad!) You bring up a point that there may be some value to being the victim of shirking. . . . it's painful to be treated like dirt or dumped, but better to take the hit during dating and not once you're stuck with someone in a more committed, marital relationship! Keep the ideas comin' friend. . . . let me know if you ever want to guest-post!

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