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> If Google is willing to pay 200k above market rate This is not possible according to the usual definition of "market rate". If Google is willing to pay X, t

> If Google is willing to pay 200k above market rate This is not possible according to the usual definition of "market rate". If Google is willing to pay X, that is the market rate.

benrbray 6y ago
I disagree with your definition of "market rate", but let's suppose you're right: Do you not see it as a problem that Google alone decides the cost of entry to an entire market?
- FartyMcFarter 6y ago
  Why do you think that Google alone can afford to hire software engineers? edit - I see how my post was misleading. I should have said X is a "lower bound" for the market rate.
  - benrbray 6y ago
    Do you mean upper bound?
- whatshisface 6y ago
  Google isn't the only well-paying software company. If they were, they wouldn't throw money away by paying so much in the absence of competition. Furthermore, there's nothing stopping you from paying $100,000/hour and beating Google if you wanted to. If your business can't make good enough use of programmers to justify paying more than Google, then maybe their talents would be best allocated where they would be most valuable.
- msla 6y ago
  > Do you not see it as a problem that Google alone decides the cost of entry to an entire market? This puts Google in the position of being a monopsony for the labor of programmers; that is, they're the only or primary buyer of that commodity. Part of antitrust laws is preventing that, so, yes, there is a problem if a monopsony arises, but Google isn't in that position anyway because jobs aren't completely interchangeable the same way programmers aren't completely interchangeable. For example, companies can compete on the basis of not being Google, which attracts some people. Companies can compete on the basis of being based in some other geographic location, or having other things to work on, or having a different mix of salary and benefits. Google offering the highest salary doesn't mean they automatically get everyone. It means they get people who want the highest salary to do what Google's interested in as opposed to wanting to work on some kinds of technology Google isn't pursuing.
mh8h 6y ago
That's assuming that the thing Google is buying is a commodity, and its value is the same to all parties.
Spooky23 6y ago
The law defines practices that, while they happen in a marketplace, are anti-competitive and thus problematic. It is not anti-competitive to own the gas station next to the airport and charge a premium for gas. It is anti-competitive to buy out surrounding gas stations and close them to extract higher prices, or to conspire with competing stations to coordinate pricing. Single-firm anticompetitive behavior, as defined by FTC: (https://www.ftc.gov/enforcement/anticompetitive-practices https://www.ftc.gov/enforcement/anticompetitive-practices) Single Firm Conduct: "It is unlawful for a company to monopolize or attempt to monopolize trade, meaning a firm with market power cannot act to maintain or acquire a dominant position by excluding competitors or preventing new entry. It is important to note that it is not illegal for a company to have a monopoly, to charge “high prices,” or to try to achieve a monopoly position by aggressive methods. A company violates the law only if it tries to maintain or acquire a monopoly through unreasonable methods." Horizontal Conduct: "It is illegal for businesses to act together in ways that can limit competition, lead to higher prices, or hinder other businesses from entering the market. The FTC challenges unreasonable horizontal restraints of trade. Such agreements may be considered unreasonable when competitors interact to such a degree that they are no longer acting independently, or when collaborating gives competitors the ability to wield market power together. Certain acts are considered so harmful to competition that they are almost always illegal. These include arrangements to fix prices, divide markets, or rig bids."
- cptskippy 6y ago
  That's in relation to creating artificial scarcity of a product or controlling supply. Staff aren't a product or commodity.
  - Spooky23 6y ago
    Labor certainly is a commodity. I have a relative who bought a very nice beach house from his legal fees suing a hospital network for doing something similar.

> If Google is willing to pay 200k above market rate This is not possible according to the usual definition of "market rate". If Google is willing to pay X, that is the market rate.

benrbray 6y ago

I disagree with your definition of "market rate", but let's suppose you're right: Do you not see it as a problem that Google alone decides the cost of entry to an entire market?

FartyMcFarter 6y ago
Why do you think that Google alone can afford to hire software engineers? edit - I see how my post was misleading. I should have said X is a "lower bound" for the market rate.
- benrbray 6y ago
  Do you mean upper bound?
whatshisface 6y ago
Google isn't the only well-paying software company. If they were, they wouldn't throw money away by paying so much in the absence of competition. Furthermore, there's nothing stopping you from paying $100,000/hour and beating Google if you wanted to. If your business can't make good enough use of programmers to justify paying more than Google, then maybe their talents would be best allocated where they would be most valuable.
msla 6y ago
> Do you not see it as a problem that Google alone decides the cost of entry to an entire market? This puts Google in the position of being a monopsony for the labor of programmers; that is, they're the only or primary buyer of that commodity. Part of antitrust laws is preventing that, so, yes, there is a problem if a monopsony arises, but Google isn't in that position anyway because jobs aren't completely interchangeable the same way programmers aren't completely interchangeable. For example, companies can compete on the basis of not being Google, which attracts some people. Companies can compete on the basis of being based in some other geographic location, or having other things to work on, or having a different mix of salary and benefits. Google offering the highest salary doesn't mean they automatically get everyone. It means they get people who want the highest salary to do what Google's interested in as opposed to wanting to work on some kinds of technology Google isn't pursuing.

mh8h 6y ago

That's assuming that the thing Google is buying is a commodity, and its value is the same to all parties.

Spooky23 6y ago

The law defines practices that, while they happen in a marketplace, are anti-competitive and thus problematic. It is not anti-competitive to own the gas station next to the airport and charge a premium for gas. It is anti-competitive to buy out surrounding gas stations and close them to extract higher prices, or to conspire with competing stations to coordinate pricing. Single-firm anticompetitive behavior, as defined by FTC: (https://www.ftc.gov/enforcement/anticompetitive-practices https://www.ftc.gov/enforcement/anticompetitive-practices) Single Firm Conduct: "It is unlawful for a company to monopolize or attempt to monopolize trade, meaning a firm with market power cannot act to maintain or acquire a dominant position by excluding competitors or preventing new entry. It is important to note that it is not illegal for a company to have a monopoly, to charge “high prices,” or to try to achieve a monopoly position by aggressive methods. A company violates the law only if it tries to maintain or acquire a monopoly through unreasonable methods." Horizontal Conduct: "It is illegal for businesses to act together in ways that can limit competition, lead to higher prices, or hinder other businesses from entering the market. The FTC challenges unreasonable horizontal restraints of trade. Such agreements may be considered unreasonable when competitors interact to such a degree that they are no longer acting independently, or when collaborating gives competitors the ability to wield market power together. Certain acts are considered so harmful to competition that they are almost always illegal. These include arrangements to fix prices, divide markets, or rig bids."

cptskippy 6y ago
That's in relation to creating artificial scarcity of a product or controlling supply. Staff aren't a product or commodity.
- Spooky23 6y ago
  Labor certainly is a commodity. I have a relative who bought a very nice beach house from his legal fees suing a hospital network for doing something similar.