4 ms·

I think adversarial/zero-sum is the wrong characterization. There are clearly misaligned interests---companies want to pay less; workers want them to pay more.

I think adversarial/zero-sum is the wrong characterization. There are clearly misaligned interests---companies want to pay less; workers want them to pay more. However, if both sides are better off under a match than they would be otherwise (which is why the market exists), then they'll try to match so long as the search costs, frictions and losses due to bad hires (i.e., adverse selection) don't swamp the benefits. Imagine the worst case job market, which is that anyone can hang out a shingle and say "I'm a highly skilled Python programmer." Suppose 1/2 are good, and add value +1 to their companies, and 1/2 are bad, and "add" -1 to their companies if hired. If there is absolutely no way to tell before hand who is good and who is bad, then no one is getting hired---the expected gain from hiring is zero. We have complete market failure (this is the "market of lemons" example). Now suppose you throw in some signals---schooling, resumes, interviews etc. if firms can tell w/ probability .8 whether someone is what they say they are. People now get hired, but even the good ones take a haircut b/c firms still wrongly hire bad programmers because the signals available--while better than nothing---are not perfect. I think SO is basically raising .8 to .95 (so to speak). This is valuable to firms and to workers and I can easily imagine a world where firms pay to get to .95 (and good workers pay to be evaluated with the .95 lens).

joe_the_user 16y ago
Hmm, your model doesn't consider that some companies might not be able to benefit from any programmers what-so-ever because of their own incompetence (some companies are -1 to begin with). Anyway, job search is certainly not entirely adversarial. But any negotiating process has to involve a sequence of honest signals from both sides. If one side can completely control the signaling process, that side can get the most benefit for the least cost (and the other side would choose a different frame if they could - and especially the most valuable players would make this choice). Thus even though I eventually do want to reveal everything and commit fully to a potential employer, I expect the process of commitment and revealing will only happen as the employer also reveals information AND makes commitments to me. It's a dance. Things that allow the employer to merely get commitment and information from me without anything in return result in an undesirable negotiating process.
- john_horton 16y ago
  sure - it's a simple model, but I don't think the presence of ignorant firms changes the basic insight. That being said, labor markets are very complex and there's lots of strategic maneuvering going on. Given the indeterminacy of much of game theory (i.e., it depends on how you model the scenario), I'm sure you could be right under the proper assumptions. But to bring it back to the SO example, it's hard to imagine a scenario where giving high ability workers the ability to truthfully signal that high ability hurts. Low ability workers can be hurt i.e., either I know you're bad from your SO rep, or I start to think "hey - where's your SO profile? you must be bad." In the pre-SO system, the low ability workers were getting an unearned rent (assuming the market existed at all) at the expense of the high ability workers and firms (which is market-killing).
  - joe_the_user 16y ago
    If you happen to have one, I think an SO account is a great thing to show potential employers. But I'd want to know that they were willing and able to read my answers to questions rather than simply look at my karma. Having been on SO a bit over time, I know very well that SO karma doesn't directly measure programming ability. You can get high karma with lots of random or dubious answers. If someone already has programming ability, they might be able to tell from someone's SO answers whether the person's real but raw karma isn't enough. The further problem is that Joel has been trying to jump from SO being a good answer site to making SO a job site in it's own. The first iteration was announced with fanfare and a post with argument for his approach. This version has appeared with little discussion on his part so I'm not sure what his reasoning is. On the general subject of signaling, if an SO account ever became a strong signal of ability, you can bet there'd be SO "gold farmers" along the lines of game gold farmers today. And while I've enjoyed SO for its own sake at times, if creating an SO account became mandatory for a job search, a lot of skilled people likely find that an annoying imposition. Google rightly has a policy against "why manhole covers are round"-type questions. They're an imposition on a candidate without proving anything. An employer asking for a SO account would have the same quality.

joe_the_user 16y ago

Hmm, your model doesn't consider that some companies might not be able to benefit from any programmers what-so-ever because of their own incompetence (some companies are -1 to begin with). Anyway, job search is certainly not entirely adversarial. But any negotiating process has to involve a sequence of honest signals from both sides. If one side can completely control the signaling process, that side can get the most benefit for the least cost (and the other side would choose a different frame if they could - and especially the most valuable players would make this choice). Thus even though I eventually do want to reveal everything and commit fully to a potential employer, I expect the process of commitment and revealing will only happen as the employer also reveals information AND makes commitments to me. It's a dance. Things that allow the employer to merely get commitment and information from me without anything in return result in an undesirable negotiating process.

john_horton 16y ago
sure - it's a simple model, but I don't think the presence of ignorant firms changes the basic insight. That being said, labor markets are very complex and there's lots of strategic maneuvering going on. Given the indeterminacy of much of game theory (i.e., it depends on how you model the scenario), I'm sure you could be right under the proper assumptions. But to bring it back to the SO example, it's hard to imagine a scenario where giving high ability workers the ability to truthfully signal that high ability hurts. Low ability workers can be hurt i.e., either I know you're bad from your SO rep, or I start to think "hey - where's your SO profile? you must be bad." In the pre-SO system, the low ability workers were getting an unearned rent (assuming the market existed at all) at the expense of the high ability workers and firms (which is market-killing).
- joe_the_user 16y ago
  If you happen to have one, I think an SO account is a great thing to show potential employers. But I'd want to know that they were willing and able to read my answers to questions rather than simply look at my karma. Having been on SO a bit over time, I know very well that SO karma doesn't directly measure programming ability. You can get high karma with lots of random or dubious answers. If someone already has programming ability, they might be able to tell from someone's SO answers whether the person's real but raw karma isn't enough. The further problem is that Joel has been trying to jump from SO being a good answer site to making SO a job site in it's own. The first iteration was announced with fanfare and a post with argument for his approach. This version has appeared with little discussion on his part so I'm not sure what his reasoning is. On the general subject of signaling, if an SO account ever became a strong signal of ability, you can bet there'd be SO "gold farmers" along the lines of game gold farmers today. And while I've enjoyed SO for its own sake at times, if creating an SO account became mandatory for a job search, a lot of skilled people likely find that an annoying imposition. Google rightly has a policy against "why manhole covers are round"-type questions. They're an imposition on a candidate without proving anything. An employer asking for a SO account would have the same quality.