What’s In It For Me?

January 4, 2008

I have now spent over fifteen years in academia, primarily in business schools, and have watched social scientists at close quarters. I have also spent time in hard science environments. I may be completely wrong but social scientists (economists in particular) seem to value their time more than hard scientists, whether or not their time is or is not more valuable.

Putting effort into something brings both material and hedonic benefits. Material benefits comprise money, reputation, external respect. Hedonic gratification comes from personal challenge, resulting in growing self-respect. We tend to value the former more than the latter. Valuing material benefits seems more concrete and easy to do than understanding the value of hedonic benefits. The greater the precision with which we can evaluate an outcome, the more we seem to value it.

I have found that social scientists constantly weigh the costs and benefits of activities to assess how much they contribute to their own enrichment. They are very reluctant to give their time to something unless the question “What’s in it for me?” is favorably answered. Hard scientists on the other hand, I find, slip extremely easily into a discussion or help students and peers without even coming close to the WhatsInItForMe (WIIFM) debate. I suspect there is much more hedonic value in hard science discovery, resulting in a lesser need for material gratification. The flip side is that social scientists value their time more because the material side of their gratification is of large proportion and easier to identify. This bottom-line mentality suppresses curiousity, further reducing hedonic enjoyment.

Social scientists invented incentive schemes but still fail to understand them. Game theorists come up with complex mechanisms that “optimize” and improve the welfare of all, even when each and every one in the game is asking WIIFM. But, you see, the game is “Nashed” (achieves a Nash equilibrium) wherein the starting axiom is that people ask WIIFM. But what if this axiom were not true? What if agents did not really always care about maximizing the value of their time? What if, God forbid, people are “irrational” and WIIFM is not a guiding principle of decision-making. Is it just possible that we might achieve even better outcomes by including hedonic outcomes in the WIIFM equation? I think hard scientists have managed to solve the latter quite well without being bogged down in the dogma of tightly defined incentive schemes.

The ability to give of one’s time when no material or reputation (ego) benefits are available is liberating. It simply allows you to access more ways to feel good than only when WIIFM is greater than zero. It just broadens the range of things that in it for you. It brings hedonic benefits. And if we dont value those hedonic benefits very much, then its time to really get worried about who we really are and what priorities drive us. I would not worry, there are many folks every where in the world that are not stuck in the WIIFM rut. We need to remember that when we have the time and we do not give it, we lose hedonic benefits; or we substitute them for material ones, of which we already have plenty, so that the marginal benefit of these is low enough to be poor trade-ins for the hedonic ones. Even an economist would know how to maximize benefit at the margin. Its too bad that being “too good” an economist actually prevents one from being just a good one.

Repeated experimental evidence has shown that economists (in comparison to other scientists) tend to offer the least to an opponent in the ultimatum game, thereby guaranteeing themselves lower outcomes when opponents reject their offers (Just google this is if this game is unfamiliar to you). By working out the exact correct solution to the game in which WIIFM is the guiding axiom, they do worse than were they to include hedonic benefits in their thinking. So it is that being “rational” leads nowhere. Just expanding the WIIFM question to whats in it for others results in empirically better outcomes.

Those who define rationality too narrowly in social games are forever doomed to lose them.