Sales jobs tend to bring in a lot of young people, and a high proportion of them aren’t able to sell much and leave—i.e. there’s high selection pressure on salespeople. There’s a selection incentive to engage in sketchy sales practices, e.g. lying about the product. Individual salespeople may intend to be honest, and even believe what they’re saying, but they’ll still be selected for saying the product is better than it is. So, the salespeople who stick around will be those who mislead customers about the product, even if they do so accidentally.
Competing products are selected by customers; they face different selection incentives depending on whether customers are mostly one-time or repeat users. If customers are mostly one time, then there’s a selection incentive for the product to look good before purchase, but less incentive to actually be good. If customers are mostly repeat users, then there’s more incentive to actually be good.
I own a few pairs of flip-flops, so I sometimes have to choose which pair to wear; the criteria by which I make that choice create selection incentives for the worn flip-flops. (I.e. if I look at which flip-flops I actually end up wearing, I’ll find that they’re selected according to those incentives.) In particular, I usually choose whichever flip-flops are most easily available at the time, which is usually whatever pair I wore most recently. (So the selection incentives change sometimes when I wear different flip-flops; they’re bistable.)
First example explains why sales people have such a bad reputation. For the second example, apparently products can’t actually be good or bad by themselves. So it’s the producer who makes the product. Are we assuming a situation where producer is able to select one time users from repeat users?
Sales jobs tend to bring in a lot of young people, and a high proportion of them aren’t able to sell much and leave—i.e. there’s high selection pressure on salespeople. There’s a selection incentive to engage in sketchy sales practices, e.g. lying about the product. Individual salespeople may intend to be honest, and even believe what they’re saying, but they’ll still be selected for saying the product is better than it is. So, the salespeople who stick around will be those who mislead customers about the product, even if they do so accidentally.
Competing products are selected by customers; they face different selection incentives depending on whether customers are mostly one-time or repeat users. If customers are mostly one time, then there’s a selection incentive for the product to look good before purchase, but less incentive to actually be good. If customers are mostly repeat users, then there’s more incentive to actually be good.
I own a few pairs of flip-flops, so I sometimes have to choose which pair to wear; the criteria by which I make that choice create selection incentives for the worn flip-flops. (I.e. if I look at which flip-flops I actually end up wearing, I’ll find that they’re selected according to those incentives.) In particular, I usually choose whichever flip-flops are most easily available at the time, which is usually whatever pair I wore most recently. (So the selection incentives change sometimes when I wear different flip-flops; they’re bistable.)
First example explains why sales people have such a bad reputation. For the second example, apparently products can’t actually be good or bad by themselves. So it’s the producer who makes the product. Are we assuming a situation where producer is able to select one time users from repeat users?