I’m about to enter the critical phase of my PhD dissertation writing, so blogging might be intermittent
over the next few weeks until the end of the year.
I’m about to enter the critical phase of my PhD dissertation writing, so blogging might be intermittent
I’m really bad at bargaining so I shouldn’t give advice on this issue. But the trick recommended in this paper really seems to make sense:
When negotiating for a salary, most of us reach for a nice, round number like $65,000. Or $90,000. Or $120,000.
But, by favoring all those zeros, we may be missing an opportunity to score a better deal, according to a new paper from researchers at Columbia Business School. They found that using more precise numbers in an initial request—or anchor, as it is known in negotiating parlance—generally results in a higher final settlement.
Precision conveys the impression that the job candidate has done extensive research and deeply understands the market for his services, said Malia Mason, the lead author of the paper and a professor at Columbia who teaches a course on managerial negotiations. When people use round numbers, by contrast, they’re conveying that they have only a general sense of the market rate for their skills.
…In one experiment, Ms. Mason and her team had 130 sets of people negotiate the price of a used car. When buyers suggested a round anchor, they ended up paying an average of $2,963 more than their initial offer. But buyers who suggested a precise number for a first offer paid only $2,256 more, on average, than that number in the end.
When it comes to negotiating salary, Ms. Mason’s research indicates that a job candidate asking for $63,500 might receive a counteroffer of $62,000, while the request for $65,000 is more likely to yield a counteroffer of, say, $60,000, as the hiring manager assumes the candidate has thrown out a broad ballpark estimate.
Usually I bargain when I am buying stuff, like a pair of shoes, a souvenir, or a cab ride home. Negotiating salaries does not happen very often. Here are some thoughts about the bargaining process in no particular order:
- In theory you should determine how much you are willing to spend and stick to that decision. In reality, you don’t want to spend more than other people do.
- The problem is that you often don’t know the “normal” (i.e.. average) price for some goods. That makes the asking price of the seller and your common sense the only reference points for your bargaining strategy.
- (Asymmetric) information can make bargaining quite stressful. You keep asking yourself: am I being overcharged? Or the opposite: am I asking ridiculously low prices?
- In the bargaining game (with asymmetric information), having the last word ends up being as important as the price itself. Sometimes you can be happy about very bad deals. Other times you might have a bitter mouth even though you got a very decent price.
- If you show high interest for some items, the asking price will probably go higher. You should always try to signal low interest and low willingness to spend.
Yep, I often find the experience quite stressful.
The question was asked on Quora. There are plenty of interesting answers:
In January 1914, Henry Ford announced a radical decision. He increased the worker wages from $2.34/day to $5/day and reduced the working time from 9 hours to 8 hours per day. Other businessmen derided Ford as a socialist, while common public heralded him as a hero. People even prodded him to run for a President. Even today, Ford’s 5 dollar workday is widely remembered in the US.
Puma paying Pele to tie his shoes in the middle of the field seconds before the kickoff of the World Cup final in Mexico (1970)… The camera made a close up and the whole world realized that the best player back then was wearing Puma shoes… Life changed for Puma after that event…
Oakley sent a pair of shades to the Chilean miners who were stuck in the mine. They sent them to protect their eyes from the sun after not having been exposed to it for a very extended period of time. When the miners emerged from the dark mine, the extremely extensive media coverage filmed and talked about how each one of them was wearing a pair of Oakley sunglasses.
And how Richard Branson started Virgin Atlantic.
In 1979, while on vacation with his fiancee in The British Virgin Islands, he was catching a flight to Puerto Rico which ended up cancelled. Richard decided to phone up some charter companies and chartered a plane for $2,000. After splitting the cost between the available seats, he grabbed a blackboard and wrote: VIRGIN AIRWAYS: $39 for a single flight to Puerto Rico.He walked around the airport terminal and soon filled every seat. When they arrived in Puerto Rico a passenger reportedly said: “Virgin Airways isn’t too bad – smarten up the services a little and you could be in business”.
More on Quora (you might have to sign up)
- Can economics save the African Rhino?
- Education and colonialism: how the British differed from the French
- Social networks as evolutionary game theory
- Scholars suggest that studying abroad in a previously-colonized country may increase people’s cultural sensitivity and awareness of global inequality. Not true.
- How Feedly is preparing for the end of Google Reader (in one photo)
Harvard Professor E.O Wilson sparked an interesting debate on the Wall Street Journal on the role of mathematics in scientific thinking. A small excerpt:
For many young people who aspire to be scientists, the great bugbear is mathematics. Without advanced math, how can you do serious work in the sciences? Well, I have a professional secret to share: Many of the most successful scientists in the world today are mathematically no more than semiliterate.
The most important skill is the ability to form concepts, not math:
Fortunately, exceptional mathematical fluency is required in only a few disciplines, such as particle physics, astrophysics and information theory. Far more important throughout the rest of science is the ability to form concepts, during which the researcher conjures images and processes by intuition.
.. Pioneers in science only rarely make discoveries by extracting ideas from pure mathematics. (..) Real progress comes in the field writing notes, at the office amid a litter of doodled paper, in the hallway struggling to explain something to a friend, or eating lunch alone.
The question here is an important one: does our ability to form complex concepts develop before or after mathematical modeling? Prof. Wilson seems to suggest that great ideas come first (while eating lunch or in the hallway etc.) and then mathematical models give structure to your thinking. But most scholars have an opposite view. Paul Krugman, for example, says that his ability to develop good ideas comes after mathematical models, not before:
mathematical grinding served an essential function (…) of clarifying my thought. In the economic geography stuff, for example, I started with some vague ideas; it wasn’t until I’d managed to write down full models that the ideas came clear. After the math I was able to express most of those ideas in plain English, but it really took the math to get there, and you still can’t quite get it all without the equations.
Over at The Slate, Math professors Edward Frenkel suggests not to be math-phobic as well. He says: “Don’t listen to E.O Wilson”:
It would be fine if Wilson restricted the article to his personal experience, a career path that is obsolete for a modern student of biology. We could then discuss the real question, which is how to improve our math education and to eradicate the fear of mathematics that he is talking about. Instead, trading on that fear, Wilson gives a misinformed advice to the next generation, and in particular to future scientists, to eschew mathematics. This is not just misguided and counterproductive; coming from a leading scientist like him, it is a disgrace. Don’t follow this advice—it’s a self-extinguishing strategy.
- Why President Kagame Runs Rwanda Like a Business | Harvard Business Review
- 67 years of potato chip innovation in 5 animated GIFS
- Do you regularly have a hundred tabs open on your browser? OneTab chrome extension might help you out
- Microfinance institutions should focus on households, not microenterprises, say Timothy Ogden and Jonathan Morduch | Foreign Policy
- Interesting paper on the role of national banks in US industrialization between 1850 and 1900 (NBER)
And finally, just in case you were wondering, here’s how the differential gear works:
When Eastern Europe opened up, following the fall of the Berlin Wall and the collapse of the Soviet Union, Prague looked like it had been sealed up in a bubble since 1948.
Google Reader isn’t communist Russia, obviously, duh — but it’s a similar pattern. There was one gigantic player and a bunch of satellites, and RSS readers more-or-less looked like it was still 2006.
Not that there wasn’t any innovation — there was some — but it’s been pretty quiet, especially compared to the several years before 2006.
RSS the format has remained as useful and cool as ever, but RSS readers haven’t done so well.
My hope — my expectation, even — is that a few things will turn this around:
- The end of Google Reader takes away that one dominant player. The market for RSS readers is no longer frozen — and it will interest more developers than it has in recent years.
- Over-reach by Twitter and its diminishing user experience makes people interested in other ways of finding good stuff to read.
- The lower costs of server-side development and deployment brings creating RSS services within reach of smaller companies.
I’m not too convinced, especially when it comes to Keynesian regulatory policy –nobody wants more regulation unless it serves some kind of purpose. I’m also not convinced with this statement (emphasis mine):
After five years of Keynesian and other anti-market “remedies,” Europe overall is in recession
Europe definitely did not take any “Keynesian remedy”. I would rather call it a badly-implemented austerity program. One that ended up in: ↑T ↑G, T + G = ∞ , which might explain yesterday’s insane vote in Italy.
- Great article by the editor of The Browser on why the best writing is on the internet
- Dan Rozas predicts a new microfinance crisis in Chiapas, and David Roodman calls him the “Roubini of microfinance”
- Why are we obsessed with growth rates? Tyler Cowen responds
- Sloppy reporting on the Kenyan elections, Ken Opalo rips the New Yorker and Al Jazeera
I love when my favorite bloggers recommend a bunch of “Assorted links” or “Links I Liked”. Today I thought I should start doing it here as well. Welcome to the very first edition of “Mixed links and reads” (not sure if I’ll keep the title though)
- Tom Murphy from A View From the Cave is launching the third edition of the “Aid Best Bloggers Awards”. You can propose your nominations here from today until the end of February. Don’t forget about Kariobangi Blog!
- The problems (and the huge hope) with M-Shwari, interesting article by John Gitau and Ignacio Mas
- A 15-minute writing exercise closes the gender gap in university-level physics (via Reddit)
- Good (short) analysis of the Kenyan presidential debate, and some grades to the eight candidates