3 ms·

I take it your point is that programmers are not fungible. So higher-quality programmers are worth more than lower-quality programmers. Sure. And when they say

by xaa 9y ago

I take it your point is that programmers are not fungible. So higher-quality programmers are worth more than lower-quality programmers. Sure. And when they say there is a "shortage", they mean there is a limited number of programmers that are "good enough" by whatever metric (they would not add the important qualification at the current salary). Suppose then there are really two markets here: one for "good" programmers and one for "mediocre" ones. My rejoinder still holds if it is really the case that they can only do with good programmers and not mediocre ones (doubtful). And since it is presumably possible to transition from non-programmer to mediocre to good with effort, the fact that "not enough" people are doing so still implies the price is not high enough. I am mainly taking umbrage at your use of "shortage". The preferences of the market participants themselves are certainly not an external force. I think we should not concede to them that there is a shortage when there is not because then they go on to use that as justification for all kinds of counterproductive legislative proposals. BTW, more than half of Keynes' GTEIM is about employment. The original question impelling modern economics is "how do we get to full employment? and what does that mean anyway"? Of course the model is an approximation. But don't use "economics" to justify an argument and then turn around and say economics doesn't model the real world.

wai1234 9y ago
Anyone that looks at SV salaries knows that they are incredibly high (and the much freer markets around them, like housing, know it :) The fact is that they could offer $1,000,000 starting salaries tomorrow and the pool of 'qualified' applicants would not change because salary is not the determining factor here. If everyone east of the Mississippi suddenly moved to SV drawn by those mouth watering numbers, what would happen? "Well, you didn't attend Stanford, so...". BTW, does anyone actually graduate from Stanford anymore?
- xaa 9y ago
  They're "high" relative to some (most) jobs and not others. It sounds like you may be implying something like "programmers make enough already". Perhaps true on a moral plane, has nothing to do with economics though. Why is gold so expensive? Because it's demanded. There is no inherent correct price to anything absent a market. > The fact is that they could offer $1,000,000 starting salaries tomorrow and the pool of 'qualified' applicants would not change because salary is not the determining factor here. OK. I think this is the core of the matter. Let's assume the number of "qualified" programmers is fixed over the short term. The market is made of actors/companies. If a company wants more of the qualified programmers, and they pay $1M starting salary, that company will get them. And then the market price will rise. The fact that it hasn't risen to $1M implies the companies don't really want them that badly. And in the long term, a price raise would encourage more programmers to become qualified and the problem would be rectified. But if what you are saying is true, and they really only want Stanford grads or equivalents, why would they care about H1Bs? It's not. They want to keep the price down. Even if we assumed the number of qualified programmers were constant, there would be no more of a "shortage" than there is a shortage of gold. We don't say there's a gold shortage even though its quantity is "fixed" and presumably everyone would like more of it if it were cheaper. I think people make a stronger argument for a shortage in the labor market WRT doctors. In that case there is a cartel (the AMA) keeping the quantity artificially low. There is no such phenomenon in programming. There's nothing stopping a university hiring all top-notch CS profs and becoming the next CMU/Stanford, and charging students a bundle...if the price were right.
- randomdata 9y ago
  What about the people who went to Stanford, and have all the right and necessary chops, but are doing more lucrative work outside of development? The Valley especially has many, many examples of these people. Part of the perceived charm of the valley is that you can make crazy amounts of money, which a day job as a developer does not provide (It's a decent living, but not crazy money). You don't believe there is ever a monetary point that you could convince them that development is a better deal than what they are currently doing? You don't think $1M, $100M, $1B wouldn't temp them in the least?

by xaa 9y ago

wai1234 9y ago

Anyone that looks at SV salaries knows that they are incredibly high (and the much freer markets around them, like housing, know it :) The fact is that they could offer $1,000,000 starting salaries tomorrow and the pool of 'qualified' applicants would not change because salary is not the determining factor here. If everyone east of the Mississippi suddenly moved to SV drawn by those mouth watering numbers, what would happen? "Well, you didn't attend Stanford, so...". BTW, does anyone actually graduate from Stanford anymore?

xaa 9y ago
They're "high" relative to some (most) jobs and not others. It sounds like you may be implying something like "programmers make enough already". Perhaps true on a moral plane, has nothing to do with economics though. Why is gold so expensive? Because it's demanded. There is no inherent correct price to anything absent a market. > The fact is that they could offer $1,000,000 starting salaries tomorrow and the pool of 'qualified' applicants would not change because salary is not the determining factor here. OK. I think this is the core of the matter. Let's assume the number of "qualified" programmers is fixed over the short term. The market is made of actors/companies. If a company wants more of the qualified programmers, and they pay $1M starting salary, that company will get them. And then the market price will rise. The fact that it hasn't risen to $1M implies the companies don't really want them that badly. And in the long term, a price raise would encourage more programmers to become qualified and the problem would be rectified. But if what you are saying is true, and they really only want Stanford grads or equivalents, why would they care about H1Bs? It's not. They want to keep the price down. Even if we assumed the number of qualified programmers were constant, there would be no more of a "shortage" than there is a shortage of gold. We don't say there's a gold shortage even though its quantity is "fixed" and presumably everyone would like more of it if it were cheaper. I think people make a stronger argument for a shortage in the labor market WRT doctors. In that case there is a cartel (the AMA) keeping the quantity artificially low. There is no such phenomenon in programming. There's nothing stopping a university hiring all top-notch CS profs and becoming the next CMU/Stanford, and charging students a bundle...if the price were right.
randomdata 9y ago
What about the people who went to Stanford, and have all the right and necessary chops, but are doing more lucrative work outside of development? The Valley especially has many, many examples of these people. Part of the perceived charm of the valley is that you can make crazy amounts of money, which a day job as a developer does not provide (It's a decent living, but not crazy money). You don't believe there is ever a monetary point that you could convince them that development is a better deal than what they are currently doing? You don't think $1M, $100M, $1B wouldn't temp them in the least?