But you rightly recognize that there is a prisoners dilemma when it comes to moral behavior. Your stomach is tempting you to defect. Your heart is telling you not to. And your head is wondering how the game could be structured to favor your heart over your stomach.
I'd normally just up-vote and move on, but I've gotta ask: Is that original or did that come from somewhere? If the latter -- I'd appreciate a reference because I'd like to read more.
Your stomach is tempting you to defect. Your heart is telling you not to.
And then, thankfully, your brain chimes in, and reminds you that while short-term PD-like scenarios seem to reward defection, in iterative scenarios -- more comparable to PD-like situations we encounter in real life -- it is cooperation (or at least, not fucking your neighbor over for the sake of short-term gain) that is very strongly incentivized.
One just ruined all the goodwill they built up with me over the past year (which got them countless free hours, crunch time at short notice, etc.) by stiffing my company of about a grand - literally a few hours' work - on some badly structured justification, the real reason being he felt his colleague was not negotiating hard enough with me and he "showed him".
Now I'm going to stick to the contract hours and probably prioritise other work over theirs; I also changed the payment terms to be upfront to avoid stiffing, and if they want extra hours, guess what, their sticker price went up from their discounted price for longstanding cooperative clients to "market rate". I guess the thousand bucks is visible and the value they lost isn't, so he probably thinks he was very successful.
It bewilders me that someone can be in business for years and not understand that cooperation is a better strategy, but there are a lot out there. I've found the short term cost of cooperating with defectors worth it in the long run, though.
It sucks about the goodwill being lost, and I'm sure it feels bad to have been stiffed by your client, but it sounds like you're going to make more money out of him now than before. And at the same time he thinks he's had a victory. In some ways this a win-win. Take your team out for a nice dinner on the extra profit and don't feel too bad about it :)
I guess so. Retaliation is the best strategy in iterative PD, no? (I'm rusty on this stuff).
Nash equilibrium in a regular PD would be DD, but it assumes that the other side will defect. I think from experience that the payoff grid is different in business in that instead of CC resulting in a lower payoff for C than for D in CD, it's a much higher payoff; and the D in CD is not getting much more than in DD (maybe 20% more).
You are thinking of tit for tat, right? I remember reading about generous T4T where in ~10% of the cases they were generous [CITATION NEEDED] it performed better that pure retaliation. Now there is a new paper in Nature[1] that I just stumbled onto in trying to answer your question. It seems like extortion is at least competitive with a generous strategy, though I need to give it a closer read.
The problem with this is you only have so many shots at a startup (you only have so much energy / free time / savings / time before you have other obligations). So it is unclear to me whether there are actually enough iterations for the right strategy to not be to break rules when convenient and ask for forgiveness later.
Let's also not forget that Conrad is not going to jail. It's a billion dollar company that's going to pay millions in fines.
> And yet, despite his downfall, Conrad is still a coveted name in Silicon Valley. People want to meet the man who created a $60 million company in just three years and made good on his promise to shake up the insurance industry. Dalgaard says he’s been getting e-mails from people eager to work with Conrad since the day his resignation went public.
> Zenefits might also survive for the one reason that made its product so appealing to business owners in the first place: Shopping for health insurance remains really frustrating. The company says it now has 20,000 accounts. “As long as their problems don’t affect our company, we’ll stay,” says Todd Harmond, vice president for finance and operations of the e-book service Scribd, which uses Zenefits to offer Kaiser Permanente and Anthem health insurance plans to its 85 employees.
> “Unless something else goes really wrong with Zenefits, we’ll stick with them for a while,” says BlogMutt’s Yates. “It’s too much of a hassle to switch.”
But you rightly recognize that there is a prisoners dilemma when it comes to moral behavior. Your stomach is tempting you to defect. Your heart is telling you not to. And your head is wondering how the game could be structured to favor your heart over your stomach.