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> Here’s where we reach our very strange conclusion. If we take the above as true, then every family member you convince to buy an iPhone or use Gmail or subscr

> Here’s where we reach our very strange conclusion. If we take the above as true, then every family member you convince to buy an iPhone or use Gmail or subscribe to Amazon Prime is contributing some small percentage to your salary increases at Random Startup, Inc. Which is a fascinating, if deeply disturbing and perverse, incentive. If we're extrapolating, this is just saying growing market means growing jobs? I don't know why this is disturbing or perverse. The opposite is true, if people stopped buying iPhones all those people who support iPhones would be out of a job. If one whole industry stops hiring then of course the premiums go down. The supply is huge and the demand is low. Sorry, I feel like this article is taking something simple and making it sound complicated and insightful without necessarily bringing a new insight?

joeyrideout 7y ago
This article left the same exact taste in my mouth (eyes?) The author has roughly described the concepts of wage inflation and supply-and-demand (for workers, in one industry, and for consumer goods), and reduced almost everything to "risk premium". Risk is everywhere in the economy, yes. The word "premium" implies additional cost over and above a base cost, which encompasses many more factors. Edit: To be fair, I'm glad that the author and some readers are excited about learning new concepts. I have many similar blog posts written, though admittedly they stay in my drafts folder if I feel they aren't contributing significant insight :)
- davnicwil 7y ago
  > they stay in my drafts folder if I feel they aren't contributing significant insight You should publish them! A blog post doesn't have to be wholly or even slightly novel to be immensely useful for someone. Right delivery, right place, right time. Others will almost certainly have thought, discussed, written about the same ideas before you but the reader might not land on their blogs or equivalent, and even if they do, the delivery might not speak to them. They might however land on yours and your delivery may be just right for them. Anyway, nobody owns ideas - to the reader, whether it's you or someone who thought of it before you delivering the idea doesn't matter - all that matters is the delivery of the idea itself.
- gandutraveler 7y ago
  This happens to me too. I read a new concept or a book apply it to some real world problem and I am almost certain that my new hypothesis is the new Nash theory. Only to re-read it the next day to realize how I overcomplicated my hypothesis just to fit the case.
staticautomatic 7y ago
"[The] promise of a deep insight into intriguing subject matters is often sufficient to lure the audience into a futile quest for understanding." https://www.researchgate.net/publication/261567941_The_Dark_Side_of_the_Loon_Explaining_the_Temptations_of_Obscurantism https://www.researchgate.net/publication/261567941_The_Dark_...
- kjivan 7y ago
  This has excellent meta potential.
whack 7y ago
I was thinking the exact same thing. I'm also not sure why the author keeps talking about tech wages as being "risk premiums", as opposed to simple supply-and-demand. If being a tech worker is very financially/physically risky, there would be a premium in wages as compared to other similar professions. But that doesn't seem applicable at all to tech workers who enjoy far more security than other professions. If anything, the fact that startup compensation is far lower than FANG salaries, would mean that there is a risk-discount. Not a risk premium. I usually don't make comments like these, but I'm honestly surprised that this article is sitting on the front page of HN.
- barrkel 7y ago
  It's because it's not actually about supply and demand; it's actually about information asymmetry. The article is specifically arguing that non-FAANG employees are getting higher wages not because of competition from (e.g.) Google, but because employers don't know whether or not they're competing with Google and have to pay extra just in case.
mychael 7y ago
Agree. I was waiting for the new insight, but it never arrived.
cryptica 7y ago
>> If we're extrapolating, this is just saying growing market means growing jobs? I don't know why this is disturbing or perverse. Except it doesn't mean a growing market at all, it means increased concentration of wealth and power in the hands of a few manipulative zero-sum game mega-corps. Where economists are wrong is that the S&P500 index has become a terrible way to measure economic growth. It mostly measures economic concentration. Also, by manipulating the market for software engineering talent, megacorps are holding the entire industry hostage. These megacorps don't need so many employees, they only hire them because they can afford it and it allows them to maintain dominance; these are smart people and their skills are basically wasted and their minds atrophy in the midst of mind-numbing bureaucracy. That's why big tech companies have so much power over politics; through market manipulation (through media influence and job market manipulation), they've created an economic fiction of fast growth and success and they're holding it for ransom over politicians' heads. The politicians have to choose between helping them to perpetuate the fiction or to be blamed for a market crash.
learnstats2 7y ago
As discussed earlier in the article - the tech company's goal is to pay the minimum. Therefore, it's unlikely that additional sales of iPhones would impact on salaries.
barrkel 7y ago
The article is about information asymmetry, not supply and demand. In fact supply and demand is a prerequisite (but apparently not sufficient) for understanding it.

joeyrideout 7y ago

This article left the same exact taste in my mouth (eyes?) The author has roughly described the concepts of wage inflation and supply-and-demand (for workers, in one industry, and for consumer goods), and reduced almost everything to "risk premium". Risk is everywhere in the economy, yes. The word "premium" implies additional cost over and above a base cost, which encompasses many more factors. Edit: To be fair, I'm glad that the author and some readers are excited about learning new concepts. I have many similar blog posts written, though admittedly they stay in my drafts folder if I feel they aren't contributing significant insight :)

davnicwil 7y ago
> they stay in my drafts folder if I feel they aren't contributing significant insight You should publish them! A blog post doesn't have to be wholly or even slightly novel to be immensely useful for someone. Right delivery, right place, right time. Others will almost certainly have thought, discussed, written about the same ideas before you but the reader might not land on their blogs or equivalent, and even if they do, the delivery might not speak to them. They might however land on yours and your delivery may be just right for them. Anyway, nobody owns ideas - to the reader, whether it's you or someone who thought of it before you delivering the idea doesn't matter - all that matters is the delivery of the idea itself.
gandutraveler 7y ago
This happens to me too. I read a new concept or a book apply it to some real world problem and I am almost certain that my new hypothesis is the new Nash theory. Only to re-read it the next day to realize how I overcomplicated my hypothesis just to fit the case.

staticautomatic 7y ago

"[The] promise of a deep insight into intriguing subject matters is often sufficient to lure the audience into a futile quest for understanding." https://www.researchgate.net/publication/261567941_The_Dark_Side_of_the_Loon_Explaining_the_Temptations_of_Obscurantism https://www.researchgate.net/publication/261567941_The_Dark_...

kjivan 7y ago
This has excellent meta potential.

whack 7y ago

I was thinking the exact same thing. I'm also not sure why the author keeps talking about tech wages as being "risk premiums", as opposed to simple supply-and-demand. If being a tech worker is very financially/physically risky, there would be a premium in wages as compared to other similar professions. But that doesn't seem applicable at all to tech workers who enjoy far more security than other professions. If anything, the fact that startup compensation is far lower than FANG salaries, would mean that there is a risk-discount. Not a risk premium. I usually don't make comments like these, but I'm honestly surprised that this article is sitting on the front page of HN.

barrkel 7y ago
It's because it's not actually about supply and demand; it's actually about information asymmetry. The article is specifically arguing that non-FAANG employees are getting higher wages not because of competition from (e.g.) Google, but because employers don't know whether or not they're competing with Google and have to pay extra just in case.

mychael 7y ago

Agree. I was waiting for the new insight, but it never arrived.

cryptica 7y ago

>> If we're extrapolating, this is just saying growing market means growing jobs? I don't know why this is disturbing or perverse. Except it doesn't mean a growing market at all, it means increased concentration of wealth and power in the hands of a few manipulative zero-sum game mega-corps. Where economists are wrong is that the S&P500 index has become a terrible way to measure economic growth. It mostly measures economic concentration. Also, by manipulating the market for software engineering talent, megacorps are holding the entire industry hostage. These megacorps don't need so many employees, they only hire them because they can afford it and it allows them to maintain dominance; these are smart people and their skills are basically wasted and their minds atrophy in the midst of mind-numbing bureaucracy. That's why big tech companies have so much power over politics; through market manipulation (through media influence and job market manipulation), they've created an economic fiction of fast growth and success and they're holding it for ransom over politicians' heads. The politicians have to choose between helping them to perpetuate the fiction or to be blamed for a market crash.

learnstats2 7y ago

As discussed earlier in the article - the tech company's goal is to pay the minimum. Therefore, it's unlikely that additional sales of iPhones would impact on salaries.

barrkel 7y ago

The article is about information asymmetry, not supply and demand. In fact supply and demand is a prerequisite (but apparently not sufficient) for understanding it.