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It's basic economics. Everyone acts in their rational self interest, including your boss. Your boss doesn't get in trouble if you decide to leave. Your boss get

It's basic economics. Everyone acts in their rational self interest, including your boss. Your boss doesn't get in trouble if you decide to leave. Your boss gets in trouble if his budget gets way out of control by giving promotions and raises left and right. On the converse, your boss doesn't pay the cost of hiring new people. It doesn't come out of his pocket. But giving 20% raises to everyone he has the suspicion of leaving will get him canned real quick, imposing a real and sizeable cost on him. The tippy top dogs of the company aren't completely stupid for running things this way. Budgets would get out of control in a hurry if they let managers do whatever they want with wages. Nepotism would run rampant without costly oversight and surveillance. Employees would learn to take advantage of easy raises. So the company bears a smaller cost (employee turnover) rather than the bigger and unpredictable costs of frequent and decentralized wage raises. There's not a great solution to this. It's an example of market failure. Everyone acting in rationally on an individual scale does not lead to group rationality.

mlthoughts2018 6y ago
In every company I’ve worked in, a manager gets in much worse trouble if a good engineer reporting to them leaves rather than exceeding budget. Most typically middle managers are not allowed to significantly alter budget for bigger raises that retain important people, yet are then punished or admonished over the comparatively worse budget loss taken through recruiting and onboarding to hire a backfill, as well as getting a reputation for being a bad manager if you can’t work miracles and retain people who deserve raises without giving them raises. The economics don’t work out the way you describe at all, and few parties in the situation act rationally.
- missedthecue 6y ago
  Acting rationally is not what I said. I said that they act in their rational self interest. That's a specific concept.
  - mlthoughts2018 6y ago
    You are trying to split hairs. “Acting rationally” and “acting in one’s own (rational) self-interest” are widely synonymous and it’s beyond unreasonable to expect readers to view them differently. My response to you was already treating them synonymously. It’s not acting in self-interest for executives to create unnecessary turnover due to withholding appropriate compensation. This leads to worse financial loss than paying high raises, and ultimately executives and managers get fired regularly by acting against their own self-interest by withholding meritocratic raises.
    - missedthecue 6y ago
      'Rational self interest' is a fairly widely known economic principle. Everyone acts in their own rational self interest, including infants, cats, and horseflies. Infants, cats, and horseflies are certainly not logicians, but when they want something, they will generally take the steps necessary to try to achieve it. https://courses.lumenlearning.com/wm-macroeconomics/chapter/reading-rationality-and-self-interest/ https://courses.lumenlearning.com/wm-macroeconomics/chapter/... A great way to think about this is voting. If we were all acting logically, everyone would vote, because in theory, we'd all be better off. But because of the principle of rational self interest, many or most people don't vote because the cost of researching candidates and policies and going to the effort of voting is very often higher than the benefit (a 1 in 100,000,000 chance of influencing the outcome of the election)
      - mlthoughts2018 6y ago
        Why do so many social science researchers publish research and write books on widespread ways in which people act against their own self-intetest? Like topics from Predictably Irrational, Irrational Exuberance, The Winner’s Curse, Moral Mazes, Thinking Fast and Slow, countless articles on LessWrong sequence on cognitive biases and heuristics, research on Last Place aversion, etc.? Your comment seems to presume a textbook definition of rational self interest actually describes the behavior of living organisms, but it profoundly does not.

mlthoughts2018 6y ago

In every company I’ve worked in, a manager gets in much worse trouble if a good engineer reporting to them leaves rather than exceeding budget. Most typically middle managers are not allowed to significantly alter budget for bigger raises that retain important people, yet are then punished or admonished over the comparatively worse budget loss taken through recruiting and onboarding to hire a backfill, as well as getting a reputation for being a bad manager if you can’t work miracles and retain people who deserve raises without giving them raises. The economics don’t work out the way you describe at all, and few parties in the situation act rationally.

missedthecue 6y ago
Acting rationally is not what I said. I said that they act in their rational self interest. That's a specific concept.
- mlthoughts2018 6y ago
  You are trying to split hairs. “Acting rationally” and “acting in one’s own (rational) self-interest” are widely synonymous and it’s beyond unreasonable to expect readers to view them differently. My response to you was already treating them synonymously. It’s not acting in self-interest for executives to create unnecessary turnover due to withholding appropriate compensation. This leads to worse financial loss than paying high raises, and ultimately executives and managers get fired regularly by acting against their own self-interest by withholding meritocratic raises.
  - missedthecue 6y ago
    'Rational self interest' is a fairly widely known economic principle. Everyone acts in their own rational self interest, including infants, cats, and horseflies. Infants, cats, and horseflies are certainly not logicians, but when they want something, they will generally take the steps necessary to try to achieve it. https://courses.lumenlearning.com/wm-macroeconomics/chapter/reading-rationality-and-self-interest/ https://courses.lumenlearning.com/wm-macroeconomics/chapter/... A great way to think about this is voting. If we were all acting logically, everyone would vote, because in theory, we'd all be better off. But because of the principle of rational self interest, many or most people don't vote because the cost of researching candidates and policies and going to the effort of voting is very often higher than the benefit (a 1 in 100,000,000 chance of influencing the outcome of the election)
    - mlthoughts2018 6y ago
      Why do so many social science researchers publish research and write books on widespread ways in which people act against their own self-intetest? Like topics from Predictably Irrational, Irrational Exuberance, The Winner’s Curse, Moral Mazes, Thinking Fast and Slow, countless articles on LessWrong sequence on cognitive biases and heuristics, research on Last Place aversion, etc.? Your comment seems to presume a textbook definition of rational self interest actually describes the behavior of living organisms, but it profoundly does not.