This is interesting. But by definition most people/companies adhere to social norms and don’t complain about lemons (otherwise it wouldn’t be abnormal to complain about them). I wonder whether this is actually unhelpful. It makes it harder to know (as an outsider) what is a genuine trend, eg ghosting, and what isn’t. If
9 out of 10 people do not speak about what they observe for fear of negative signalling, then silence reflects social norms and not the underlying truth.
In your interview example, an employer would surely take a dim view of someone complaining of a crap former boss, because, like you say, speaking negatively is just not done in an interview. Yet that same employer would likely believe that same person if they complained of a former boss after having already been hired into the role. Per social norms, we know you present the best version of yourself in an interview and then kind of relax after you’ve been hired. But these norms actually make it harder to hire people, as it takes some skill to penetrate the polished layers a skilled candidate can present and figure out what is genuine about them.
So there might not be much wisdom in the lemon model after all. It would be easier if everyone just told it like it is, lemons and all. But, sure, the world doesn’t work this way…sigh
I agree, I would go so far as to say that there is no question that asymmetric/imperfect information is generally bad for both sides. We have evolved this lemon/signaling system to deal with it, but people are always trying to come up with better solutions. The used car market today seems fine, for example.
It's a tough nut to crack - Rich Barton has had a lot of success bringing products to market that enhance transparency - Zillow, Glassdoor - but these are still highly imperfect solutions. Who is the most likely to leave a Glassdoor review? A disgruntled lemon, I think. Still, I think there is no question that software and the internet have done a lot to solve markets with imperfect / asymmetric information.
I think there's a lot more to explore here - like how does MeToo/whisper networks fit into this model, and how can they be hacked? Maybe in another post. All I wanted to get at here is that it's interesting that people are so willing to publicly badmouth the people they work with, and it's only in an interview situation that they understand that it is not in their interest to do that.
That's an interesting observation that you are fully expected to dish the dirt about your former employer *after* you have been hired, at least to some degree. Certainly they expect you to warn them if someone you worked with was dishonest and wants to do business with your new employer. I think that reflects that your employer isn't dealing with imperfect information anymore - they know exactly how you work in their environment - so they aren't trying to glean hints like they were before.
Yeah I think you’re right that markets can work fine with imperfect information when everyone implicitly understands the rules, e.g. used cars. The situation is tougher when the rules change, e.g. per your post normally employers have bargaining power but in certain sectors post-covid the bargaining power has shifted to employees and so the ghosts have switched sides…
Re. the candidate, I think it’s not that they would necessarily be expected to cough up info after they’d been hired, but more that, if they did speak negatively about past experiences, it wouldn’t by that point be such a violation of social norms that it would signal adverse selection.
Great article, I just discovered your Substack and have enjoyed the two pieces I've read so far!
I appreciate the distinction between identifying and fixing specific problems via constructive criticism, and badmouthing somebody for their ordinary imperfections. I agree with Richard Pickering that it's hard to figure out what "normal" looks like. I don't know that having more tolerance for complaining would really help, though. We already have lots of access to anecdata via our friendships and the media to anecdata about jobs, dating, and more. The question is whether we need more or less on the margin, and in what settings. I'd prefer to see less anecdata on the margin, with more care given to the settings in which we discuss it.
Problems are a fact of life even with above-average levels of overall functionality. The reliable car with the intermittent A/C, the fair boss with the cranky attitude. There's always something to criticize. It just needs to be done constructively, and in an appropriate setting and style. Job postings and interviews are not the place.
I remember someone (Bill Simmons?) long ago observing that you have to be incredibly naive to date a superstar musician, because you know there's a good chance they will someday write a multi-platinum hit about your breakup that will not cast you in a good light and might be the only thing people remember about you. I wonder what young people would tell you if you ask them who Dave Coulier was?
You do learn in school that matching models apply to both the employment market and the dating market, so some of the same principles apply. I figured I would leave that out in this post, though, you can figure it out for yourself :)
This is interesting. But by definition most people/companies adhere to social norms and don’t complain about lemons (otherwise it wouldn’t be abnormal to complain about them). I wonder whether this is actually unhelpful. It makes it harder to know (as an outsider) what is a genuine trend, eg ghosting, and what isn’t. If
9 out of 10 people do not speak about what they observe for fear of negative signalling, then silence reflects social norms and not the underlying truth.
In your interview example, an employer would surely take a dim view of someone complaining of a crap former boss, because, like you say, speaking negatively is just not done in an interview. Yet that same employer would likely believe that same person if they complained of a former boss after having already been hired into the role. Per social norms, we know you present the best version of yourself in an interview and then kind of relax after you’ve been hired. But these norms actually make it harder to hire people, as it takes some skill to penetrate the polished layers a skilled candidate can present and figure out what is genuine about them.
So there might not be much wisdom in the lemon model after all. It would be easier if everyone just told it like it is, lemons and all. But, sure, the world doesn’t work this way…sigh
I agree, I would go so far as to say that there is no question that asymmetric/imperfect information is generally bad for both sides. We have evolved this lemon/signaling system to deal with it, but people are always trying to come up with better solutions. The used car market today seems fine, for example.
It's a tough nut to crack - Rich Barton has had a lot of success bringing products to market that enhance transparency - Zillow, Glassdoor - but these are still highly imperfect solutions. Who is the most likely to leave a Glassdoor review? A disgruntled lemon, I think. Still, I think there is no question that software and the internet have done a lot to solve markets with imperfect / asymmetric information.
I think there's a lot more to explore here - like how does MeToo/whisper networks fit into this model, and how can they be hacked? Maybe in another post. All I wanted to get at here is that it's interesting that people are so willing to publicly badmouth the people they work with, and it's only in an interview situation that they understand that it is not in their interest to do that.
That's an interesting observation that you are fully expected to dish the dirt about your former employer *after* you have been hired, at least to some degree. Certainly they expect you to warn them if someone you worked with was dishonest and wants to do business with your new employer. I think that reflects that your employer isn't dealing with imperfect information anymore - they know exactly how you work in their environment - so they aren't trying to glean hints like they were before.
Yeah I think you’re right that markets can work fine with imperfect information when everyone implicitly understands the rules, e.g. used cars. The situation is tougher when the rules change, e.g. per your post normally employers have bargaining power but in certain sectors post-covid the bargaining power has shifted to employees and so the ghosts have switched sides…
Re. the candidate, I think it’s not that they would necessarily be expected to cough up info after they’d been hired, but more that, if they did speak negatively about past experiences, it wouldn’t by that point be such a violation of social norms that it would signal adverse selection.
Thanks again for the interesting piece !
Great article, I just discovered your Substack and have enjoyed the two pieces I've read so far!
I appreciate the distinction between identifying and fixing specific problems via constructive criticism, and badmouthing somebody for their ordinary imperfections. I agree with Richard Pickering that it's hard to figure out what "normal" looks like. I don't know that having more tolerance for complaining would really help, though. We already have lots of access to anecdata via our friendships and the media to anecdata about jobs, dating, and more. The question is whether we need more or less on the margin, and in what settings. I'd prefer to see less anecdata on the margin, with more care given to the settings in which we discuss it.
Problems are a fact of life even with above-average levels of overall functionality. The reliable car with the intermittent A/C, the fair boss with the cranky attitude. There's always something to criticize. It just needs to be done constructively, and in an appropriate setting and style. Job postings and interviews are not the place.
Also applies to every Taylor Swift ex-boyfriend sucking
I remember someone (Bill Simmons?) long ago observing that you have to be incredibly naive to date a superstar musician, because you know there's a good chance they will someday write a multi-platinum hit about your breakup that will not cast you in a good light and might be the only thing people remember about you. I wonder what young people would tell you if you ask them who Dave Coulier was?
You do learn in school that matching models apply to both the employment market and the dating market, so some of the same principles apply. I figured I would leave that out in this post, though, you can figure it out for yourself :)