Dear Economist

The early bird

Dear Economist,

To improve my chances of getting a raise should I be the first person to walk through the office door in the morning or the last person to leave at night?

D. Clark, Seattle

Dear D. Clark,

Being first into the office is a risky business. What if you get in at 6.30am but someone else was there at 6.15am? In the winner-take- all world you envisage, you might just as well have crawled in at 10am, because there are no prizes for coming second.

Being last out of the office is, at least, predictable. You just wait until everyone else has gone, and barely a second longer. However your colleagues will realise this, so the last-out strategy may become popular, and thus expensive. Which is the easiest path to a raise?

Strange as it may seem, both competitions are a form of auction – in both cases, the bids are effort not cash, and in both cases, it’s not just the winner who has to pay. Nobel laureate William Vickrey has shown, surprisingly, that all such auctions raise the same expected revenue. Both the first-in and the last-out competition will be equally profitable for your boss and equally costly for you.

I have a word of advice and a word of caution…

Continued on ft.com.

22nd of April, 2006Dear Economist • Comments off