The question of ‘why don’t these people all just quit’ is a good one. I forget exactly where I lay out what exactly the costs of exit are, if it’s not clear, but:
1. The sunk costs are huge. You give up all of your investment, lose the related social/human capital. You’ve built your life around this job—you’ve chosen your friends, your location, your skills, often your family. Not only do you give up potential upside but your income right now drops through the floor.
2. You’ve self-modified to get this far, in ways that make leaving or failing painful to you, and which will hurt you on the outside.
3. As you invest in this, you give up other opportunities to learn how to work outside a maze and be effective.
It is common for people who quit (based on personal experiences of friends) to have no idea how to actually do real object-level work, or how to do so and get paid for it or otherwise extract any value from it, due to how long they’ve spent in mazes. Which, depending on what you think of school/academia, could be basically their whole lives.
Two posts from now is where I currently have the “if you are this person, QUIT NOW” post, and I expect tons of the objection that this is completely unrealistic an ask because exit is too expensive.
Most of these are not actually barriers to exit. Many of them do enter the calculation of value of the job (relative to opportunity cost), but those are not exit barriers. Exit barriers are a one-time cost incurred by exit (example: cancellation fee), not lost ongoing benefit (example: foregone salary) - that’s why they’re called “exit costs”, not “opportunity costs”.
Let’s go through a few.
The sunk costs are huge. You give up all of your investment, lose the related social/human capital.
Sunk costs are not a barrier to exit—that would be the sunk cost fallacy. The fallacy itself may be a barrier to exit, though, and “middle managers are committing the sunk cost fallacy in droves” sounds entirely plausible.
You’ve built your life around this job—you’ve chosen your friends, your location, your skills, often your family.
My girlfriend is a software engineer at Google. One “barrier” to her leaving is that she’s pretty close friends with her co-workers; we all hang out pretty often outside of work. That’s not an exit barrier any more than “not getting paid salary” is an exit barrier. The job provides value partly in friends and culture, and that’s a perfectly reasonable way to get paid.
If managers gain negative value (net opportunity cost) from their jobs, then friends/culture/etc need to be included in that calculation. If friends/culture/etc make it net-positive, then that’s fair—the job provides value.
You’ve self-modified to get this far, in ways that make leaving or failing painful to you, and which will hurt you on the outside
There’s two claims here: (1) people have self-modified to create their own barrier to exit (by “making it painful”), and (2) people have self-modified in ways which will hurt them on the outside. Of those two, only the first is a barrier to exit. The second enters into the net value calculation.
As you invest in this, you give up other opportunities to learn how to work outside a maze and be effective.
Sunk costs again.
Other than self-modification to make leaving painful, the only other item in the list which is actually an exit cost is:
your income right now drops through the floor
i.e. the temporary loss of income while job-hunting. (There may also be a long-term loss of income if the new job pays less, but that goes in the net value calculation, not the exit cost.) Of course, this item applies to all job-hopping, and I see no reason at all to think it’s especially relevant to managers or people in mazes.
Bottom line: there is still no viable case here for super-perfect competition, or at least no more so than in most jobs. There is potentially an interesting case for people self-modifying in ways which make their opportunity costs less appealing, or their current job more appealing.
Many examples from people in the community, plus other people I have known, who found themselves in that situation, are a strong contributor to this. Some of them described their experiences very well. Also personal experience—I noticed that I myself had no idea how to do this outside of a few select areas where I had unusual experiences and friends who helped me achieve this, slash some of my talents/skills happen to have unusually direct paths to being useful work.
We can also look at general behavior in these situations, how people talk when they are looking for what to do next and clearly want to do something object-level both real and in fiction, etc etc. And we can look at the fact that it is strangely hard to find good hires for real object-level tasks even with solid pay.
Studies are basically not a thing anywhere in this sequence, they don’t exist and I don’t even know how one would do one if you had the funding and support to do so. That’s one big reason why all of this remains deniable/invisible.
The question of ‘why don’t these people all just quit’ is a good one. I forget exactly where I lay out what exactly the costs of exit are, if it’s not clear, but:
1. The sunk costs are huge. You give up all of your investment, lose the related social/human capital. You’ve built your life around this job—you’ve chosen your friends, your location, your skills, often your family. Not only do you give up potential upside but your income right now drops through the floor.
2. You’ve self-modified to get this far, in ways that make leaving or failing painful to you, and which will hurt you on the outside.
3. As you invest in this, you give up other opportunities to learn how to work outside a maze and be effective.
It is common for people who quit (based on personal experiences of friends) to have no idea how to actually do real object-level work, or how to do so and get paid for it or otherwise extract any value from it, due to how long they’ve spent in mazes. Which, depending on what you think of school/academia, could be basically their whole lives.
Two posts from now is where I currently have the “if you are this person, QUIT NOW” post, and I expect tons of the objection that this is completely unrealistic an ask because exit is too expensive.
Most of these are not actually barriers to exit. Many of them do enter the calculation of value of the job (relative to opportunity cost), but those are not exit barriers. Exit barriers are a one-time cost incurred by exit (example: cancellation fee), not lost ongoing benefit (example: foregone salary) - that’s why they’re called “exit costs”, not “opportunity costs”.
Let’s go through a few.
Sunk costs are not a barrier to exit—that would be the sunk cost fallacy. The fallacy itself may be a barrier to exit, though, and “middle managers are committing the sunk cost fallacy in droves” sounds entirely plausible.
My girlfriend is a software engineer at Google. One “barrier” to her leaving is that she’s pretty close friends with her co-workers; we all hang out pretty often outside of work. That’s not an exit barrier any more than “not getting paid salary” is an exit barrier. The job provides value partly in friends and culture, and that’s a perfectly reasonable way to get paid.
If managers gain negative value (net opportunity cost) from their jobs, then friends/culture/etc need to be included in that calculation. If friends/culture/etc make it net-positive, then that’s fair—the job provides value.
There’s two claims here: (1) people have self-modified to create their own barrier to exit (by “making it painful”), and (2) people have self-modified in ways which will hurt them on the outside. Of those two, only the first is a barrier to exit. The second enters into the net value calculation.
Sunk costs again.
Other than self-modification to make leaving painful, the only other item in the list which is actually an exit cost is:
i.e. the temporary loss of income while job-hunting. (There may also be a long-term loss of income if the new job pays less, but that goes in the net value calculation, not the exit cost.) Of course, this item applies to all job-hopping, and I see no reason at all to think it’s especially relevant to managers or people in mazes.
Bottom line: there is still no viable case here for super-perfect competition, or at least no more so than in most jobs. There is potentially an interesting case for people self-modifying in ways which make their opportunity costs less appealing, or their current job more appealing.
I’m quite surprised by this but don’t find it entirely implausible.
Concretely, what evidence caused you to believe it? I’m curious about data (anecdotes, studies, experience, …) rather than models.
Many examples from people in the community, plus other people I have known, who found themselves in that situation, are a strong contributor to this. Some of them described their experiences very well. Also personal experience—I noticed that I myself had no idea how to do this outside of a few select areas where I had unusual experiences and friends who helped me achieve this, slash some of my talents/skills happen to have unusually direct paths to being useful work.
We can also look at general behavior in these situations, how people talk when they are looking for what to do next and clearly want to do something object-level both real and in fiction, etc etc. And we can look at the fact that it is strangely hard to find good hires for real object-level tasks even with solid pay.
Studies are basically not a thing anywhere in this sequence, they don’t exist and I don’t even know how one would do one if you had the funding and support to do so. That’s one big reason why all of this remains deniable/invisible.