David Ricardo's Blog

This variation of the principle-agent model is actually a significant problem that I faced when working as a swim instructor a few summers ago. The two principles that I had at the time were my boss who coordinated the private lessons that we scheduled, the parents of the children that I was teaching. These private lessons were scheduled to be half an hour and the parent is instructed to pay before entering the pool. Each lesson is a flat rate with no discounts given for multiple lessons. It is also the same rate for multiple children to be in the same lesson. As the agent, I was expected to be there 15 minutes early to collect equipment, formulate a lesson plan and then mark out an area of the pool for the lesson to take place in. The pool had to be claimed, because these lessons often occurred during free swim hours at the pool. The conflict between the principles idea of high and low effort usually revolved around the amount of time that the lesson consumed. Even with the 15 minut...

The best example from my work experience that I can think of occurred in my second year as a swim instructor. As I had mentioned in earlier posts, one of my two bosses had become a bit more detached and passive aggressive than she had been in past summers. This of course sparked some conflict. To start all the way at the beginning, this conflict started in the third week of the summer. On that Thursday afternoon, there were a few of us employees helping our boss (R) move. Among us was one guy in particular who had been working at the pool for five years or more (we will call him S). While moving, R was a bit clipped and no nonsense, instead of her usual laid back self. S commented to a few of us and said it was a bit odd. At this point I would say that their personal and work relationship deteriorated a little bit. About two weeks later, we had a special day. At the end of the last class of each two week session, we would allow the children to go down the water slides for fifteen m...

My personal experience with team production with gift exchange is with a common phenomenon, shift swapping. The summer after I had graduated from high school, I was working as a lifeguard at a very unorganized pool. The pool had past problems with employees shift swapping and had technically banned the process. However, they didn't officially regulate this. As long as five guards showed up for every shift, no head guards checked who was supposed to be on duty. So, as long as your substitute showed up for the shift, you were in the clear. A big issue then became that the shift swapping was based solely on a trust system. There was no official schedule change or book of shifts swapped with signatures, like at other places that I had worked. If  the person that you swapped with didn't show up, you had no way to prove the agreement or back it up. As a result you would be written up, placed on probation or fired depending on how many times it happened. A second issue was then that...

I think that a lot of the choices that I have had to make concerning college have revolved around minimizing income risk and mostly one other factor. This factor is what I want to do after I graduate. Since I was a junior in high school I have wanted to create a technique for human embryo genetic engineering. This basically allows for the rewriting of human genes before a person is born. This has limitless potential for lowering cancer rates, heritable diseases (Alzheimer's, huntingtins), disjunction diseases (trisomy 21, 19, 13 etc.) and hundreds of other diseases that are due merely to a change in a few base pairs of a 3 billion base pair genome. Because of this, I chose my majors as molecular and cell biology and economics, so that I could get both a basis for the science side and a small understanding of the business side. My other aim was to limit the costs of getting these degrees. While I had offers at 5 colleges, including two of the top ten ranked programs in molecular a...

1) Looking at all of my old posts as a whole, I don't see many connections, apart from the obvious. Of course they all center around economic theories, specifically about organizations. One connection that really popped out at me though was efficiency. All of my posts address scenarios where groups are considered and factors are analyzed that show why a groups is more or less efficient or theoretical ways to make an organization more or less efficient. I think this is both interesting and encouraging, because it shows a very valuable real world application to each of the topics that we have discussed. As someone who wants to possibly own their own business in the future, I find this very encouraging. The second similar connection would be analysis from an upper management position. In many of these scenarios, we are looking from a bosses perspective at how best to manage a company or organization. Again, showing a real application for future management. As a side note, I found the ...

The example that comes to my mind when I think of the Illini bucks concept is parking. Personally, I have had an enormous amount of trouble with parking here at uiuc and I know I'm not the only one. In the scenario that I am thinking of, Illini bucks can be used to allow the buyer to buy preferential parking spaces (closer to their classes/apartment, off the street, covered or in a garage, etc.) It is important to note that the Illini bucks don't actually buy the parking spot, they just allow the buyer the ability to buy the spot. One change that would have to be made from the scenario that Professor Arvan outlined in the prompt would be that there would have to be other options for using Illini bucks other than for parking spaces, and the system for using the Illini bucks for parking spaces would have to be mediated by bidding. Without these two assumptions, everyone would just use all of their Illini bucks to buy the same level of access and the currency would be useless. ...