There are some things money can't buy. They are the exceptions that prove the rule.

For the pedants, to say something is an exception that proves the rule is to say that when you look at the exceptions, they're so unusual that it reinforces the point that the rule is generally valid even though it isn't universally valid. In the case of money, there's a reason people don't say things like "there are some things hand-knit scarves can't be bartered for" or "Hand-knit scarves can't be bartered for happiness."

Eliezer once described the sequences as the letter he wishes he could have written to his former self. When I think of the letter I wish I could write to my former self, the value of money is at the top of the list of things I'd include. 

You can give a cynical, Hansonian explanation of why we don't tell young people enough about the awesomeness of money, and I suppose there'd be some truth to it. But I'm not sure that was my main problem. Growing up, my dad spent a lot of time urging me to go into a high-paying career, to the point giving me advice on what medical specialty to go into. He just didn't do a great job of selling me on it. It wasn't until I learned some economics that I really came to understand why money is so awesome.

(Disclaimer: I don't actually know that much economics, and in fact have never taken an economics course. I just know more than my former self.)

The first thing to understand about money is that the range of things you can get for it is really incredibly huge. Econ bloggers Tyler Cowen and Alex Tabarrok periodically do posts called "markets in everything" where they highlight some of the weirder examples of this, but the weird examples matter less than the obvious examples people just don't think about much.  There's a tendency to associate money with a narrow range of things rich people stereotypically spend their money on. Or, in my case growing up in an upper middle-class family, there were the family vacations and boats that my dad seemed to mainly spend his money on, which were nice but didn't seem particularly worth planning my career around.

Yet not only is the range of things you can get with money huge, even with things you can get without money, spending money on them is often a better way of acquiring them. The reason for this is comparative advantage, a concept that gets discussed a lot in the context of nation-states and why free trade is a good idea, but which also works on an individual level. For example, say you're a lawyer who makes $300 an hour, and you're trying to solve the problem of how to keep your house clean. You could spend a couple hours a week doing it yourself—or you could work slightly longer hours and hire someone else to do it for $30 an hour.

The reason this is an example of comparative advantage is it doesn't matter if the people you're paying to clean your house are any better at house-cleaning than you. In fact, it works even if they're slightly worse, as long as the difference in house-cleaning ability is overshadowed by the difference in lawyering ability. In econ jargon, you can have an absolute advantage at both lawyering and house-cleaning, and it will still make sense to pay other people to clean your house if they have a comparative advantage there. Many people who aren't rich probably assume that when rich people hire other people to do basic tasks for them, it's a frivolous expense, but under the right circumstances it can a matter of economic efficiency.

This point about comparative advantage, when applied to charity, is one of the central insights of the effective altruism movement ("earning to give"). Suppose instead of talking about a lawyer who wants to keep his house clean, we're instead talking about a lawyer who wants to help the local soup kitchen. He could volunteer to help out there in his spare time, but he could also work a little longer hours, donate the money, and enable the soup kitchen to hire more person-hours of work there. Choosing to volunteer rather than give would suggest the lawyer isn't mainly concerned about helping the soup kitchen, but perhaps with warm fuzzies or being seen doing good.

And this doesn't just to small-scale decisions about donating some money vs. volunteering a few hours. It also applies to someone trying to decide between, saying, going into a career in medicine and eventually joining Doctors Without Borders vs. going into a career in finance and using the money you make to pay people to distribute bed nets to stricken regions of the world. (That person was me when I was younger, except the second option wasn't even on my radar.)

Note that while I personally think earning to give is an especially important example of how you can exploit comparative advantage to achieve you're goals, it's also worth emphasizing that it's just a special case of a general principle which can be extremely powerful even if you don't care about making the world a better place.

Given all this, what of the saying "if you want something done right do it yourself"? The answer is that, yes, the difficulty of figuring out who's competent and trustworthy does impose transaction costs on hiring people to do stuff for you, but it's important to remember the costs are finite. When the difference in comparative advantage is large enough, they'll often be worth paying.

Now there are still things money can't buy, at least not literally. But money tends to make them easier to acquire. Take the classic example of happiness: there's a traditional idea (which I've heard attributed to the Greek philosopher Epicurus, though I can't find the source now) that more money makes you happier up to a certain point since it's hard to be happy if you're starving, but beyond that more money doesn't help. It turns out that it's not clear this is actually true—some studies have found more money leads to greater happiness up through the highest income levels examined.

But suppose, in spite of this, that you're an income satisficer, meaning you want to make a certain amount of money and don't care about additional money beyond that. Suppose as long as you have that certain amount of money, you care more about being able to do what you love. And suppose you don't care about being able to make the world a better place through donating to charity. Should you then pursue whatever career you think you'll enjoy the most out of those that pay enough money?

Not necessarily. The way to think about this is to realize that time spent  is, in an important sense, an expensive luxury. In economics, there's a concept called opportunity cost, which is closely related to comparative advantage. Opportunity cost asks: by choosing to do something, what's the next-best alternative you're giving up? So for example, by this standard the biggest cost of college for many people will be not tuition, but the time they spent in college that could've been spent working. Even if you didn't go to summer classes, didn't study all that much, and were only qualified for minimum wage jobs, it still easily adds up to more than the cost of a state school in the US.

A lot of things turn out to be like this: when you translate the cost in time into a monetary value, time is the biggest component of the cost. Once you start thinking in those terms, it becomes easier to see that just as there are two ways to convert time into a clean house (clean it yourself, or work at a job where you have the comparative advantage and pay someone else to clean it), there are two ways to maximize the amount of time you spend doing things you enjoy: find a job you mostly enjoy, or else find a high paying job you hate and work part-time / take frequent long sabbaticals / work hard when you're young, then retire early.

People tend not to even consider the second set of options because they've been sold a model of "work nine to five for fifty weeks a year from college graduation until you qualify for Social Security," and you are nudged towards that model somewhat by employers assuming it. But it's not mandatory, and if you acquire in-demands skills that can translate into greater flexibility. I have a friend who's a dev consultant who recently took a month sabbatical from her job and then quit entirely without having another one lined up because (1) she makes enough money she doesn't need to work year-round and (2) her skills are sufficiently in-demand that she's not worried about her ability to get another job when she wants one.

On the flip side, to understand one of the main problems with the "get a job you love" strategy, consider the extreme case: a job you'd do for free. The problem with such jobs is that they tend to be jobs other people are willing to do them for free too. That makes it hard for anyone to get paid. For example, I love writing, and I'm doing it for free right now. But it turns out lots of other people feel the same way, and the internet has made it really easy for all of us to distribute our writing for free, and now it's even harder to get paid as a writer than it was during the age of print.

This is just one example, but I suspect there's a systematic reason why the "get a job you love" strategy tends to produce outcomes you didn't really want: it can make it harder to see what tradeoffs you're really making between money and time spent doing things you want to do for their own sake. In the worst case, you end up getting the worst of both worlds: you become a college professor because you think it will pay okay (if not great), and you'll get to devote all your time to the life of the mind. But you end up adjuncting for what's effectively minimum wage while spending most of your time dealing with undergrads who are just taking the course for the elective and only care about getting an A with as little effort as possible.

I'm not saying everyone should optimize solely for money in choosing their career. But at the very least, it's worth putting considerable effort into finding out how much you could (perhaps not immediately, but after but in a year or several) if you did optimize for money. That way, you'll at least know the tradeoff you're making when you chose a different career.

And by the way, if you're reading LessWrong, odds are you're fairly smart, and may be underestimating how monetizable your intelligence is. I'd like to repeat the advice given by other people in the online rationalist community to look into programming as a career choice. I'm currently doing App Academy and highly recommend it, if you do apply tell them I sent you. You may also be able to get good information on choosing a career from 80,000 Hours.

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Needs to start with a list of the top 5 things you spent money on that were completely awesome and that your younger self didn't know about. The Concrete-Abstract writing pattern says to give the example first, then the generalization; currently you're missing the example part.

Right. The post is also a bit unstructured, but lack of truly awesome examples was my main problem with it, too. The main everyday example given was house cleaning. But that seems like such a stereotypical example that I wonder a) whether people actually do find it sufficiently awesome to hire people to clean their houses, and b) if it's the only example of its kind. EDIT: Some other comments suggest CFAR workshops as an awesome expense. I have no first-hand experience with them, but that sounds plausible to me.

Here is an example which I discovered only recently and which for me is 10x the awesomeness of house cleaning.

I like to work on casual games as a hobby, I haven't released many but it's something I like to do. I am a software engineer and have no art skills. You can make a game with no art, or make a port of some game for which the art exists. It is limiting.

Enter the miracle of Elance. You can find good artists on that site, with experience making art and animations for games, and they're very affordable. I think they charge less per hour than house cleaners in California. All of a sudden getting real art for your game is just an ordinary hobby-related expense, kind of like if I were into photography I'd spend money on lenses and Photoshop license fees.

(My experience was mostly with graphics artists, but that site is general-purpose, you can find people willing to do all sorts of work there, translation, programming, whatever.)

But doesn't this undercut the original point a bit?
This is a very good point, but I'm hesitant to do anything about it because now I'm envisioning how to completely re-write the post as "Why Money is Awesome: The Listicle" and I'm not sure doing that's a good idea. (Clarification: not meant to be sarcastic. Actually I wonder if the listicle format could've worked for this post. But now that I've written it one way I'm reluctant to re-write.)

In most jobs, it's hard to change the number of hours a week you work in order to earn more or less money.

Depends if you count future income. Highest paying careers are often so because only those willing to put in extra effort at their previous jobs get promoted. This is at least true in my field, software engineering.
I more or less agree, but note that extra effort does not necessarily mean extra hours. Though, depending on who you work for the latter might be a good proxy for the former.
The important thing is to make the right people notice you put in the extra effort. Woking extra hours seems like the obvious solution, but depending on circumstances it may not be the best one. If the company does not keep records (or if your boss outsources the recordkeeping to someone else), it may even be unnoticed. The good strategy requires finding out what your boss considers an evidence of an extra effort. (Some bosses may consider extra hours an evidence of extra effort, others may consider it an evidence of incompetence.) Then produce that. If you really put in the extra effort, make sure you don't forget to provide this evidence. (And of course there is a dark path of not putting in the extra effort, just optimizing for this evidence. Even if people notice you optimize for evidence, they will probably not discount properly.) For example, bosses are often not aware of what their subordinates are doing. And to some degree that's okay, because you are paid to take care about the details. It's just: the more you see something, the more real it seems. So you could sometimes remind your boss of what you are doing, in a way that does not make them worry about you not being able to handle it. Like: "Yesterday I had this interesting problem [keyword, keword, keyword, skip the boring details], it was really complicated, but then I solved it successfully, so no problem, everything goes according to the original plan." For example while you are together at lunch. (Dark version: describe a problem your colleague had and solved yesterday, but pretend that you contributed to the solution. The boss will be delighted that you care deeply about the company and take initiative even beyond your responsibilities.)

It is worse than you imagine. Putting in heroic hours is pure signal. Fatigue will kill your actual productivity to below that of putting in a 40 hour week if you do it for more than 3 weeks at a time. This is especially true in programming as a tired programmer can very easily have outright negative output - it will take more than an hour to fix the errors committed during that extra hour you put in. Entire industries ignore this because it has become a social norm within them that going home after regular business hours is a sign of lacking commitment, and it takes a rare level of... Sanity and towering belief in your own judgement for the boss of a firm in these industries to go against that norm and evict stragglers from the office at closing time willy-nilly. I still recommend finding one if you possibly can. Or being one. The average programming shop is run abysmally badly - it should be fairly straight forward to prosper by following a handful of simple rules of productivity (Meetings at open and close of day, not noon, no all-nighters.. ect)

If you intend to engage in pure signalling to get ahead as an employee, find signals that dont waste 20-30 hours of your time per week.

This is probably specific for USA. In my country this does not happen in IT. (Some other professions are exploited this way, e.g. doctors. Which is even more horrible, if you imagine the consequences.)
It's not just exploitation by elders in medicine though. Many young doctors work ridiculous hours by choice, and their more reasonable colleagues suffer as a consequence. It's terrible that the expertise of doctors should make them fully acknowledge the dangers of sleep deprivation for example, yet some of them wilfully ignore the facts.
Pure signal? Some people actually like their jobs, and perhaps the extra income too. ETA: are people expected to work extra hours for free in the US?

are people expected to work extra hours for free in the US?

Depends on the kind of work you're doing. Under American labor law, workers in retail, manufacturing, or the trades can't be asked to work more than eight hours a day or forty hours a week without being paid their hourly wages plus a substantial overtime bonus. However, there's a loophole. American workers in clerical, administrative, and professional positions -- those on the administrative side of historical labor disputes, in other words -- are usually paid a fixed yearly income (salaried, or "exempt") and are not eligible for overtime pay.

This has both advantages and disadvantages. The advantage is that the hours are usually more flexible and there's less administrative overhead; the disadvantage is that people that want to signal loyalty or overachievement are incentivized to work crazy hours without extra pay, a practice that employers often encourage, or even -- though usually only in the short term -- de-facto require. Most studies I've read find that actual productivity doesn't go up much with the extra hours in the long run, especially for knowledge workers, but it occasionally does make busine... (read more)

Most studies I've read find that actual productivity doesn't go up much with the extra hours in the long run, especially for knowledge workers Not as clear cut as people like to assert, see e.g., If you have data for knowledge workers specifically that paints a different picture I'd like to hear about it.
It probably differs a lot from person to person.
That made the picture a lot clearer, thanks. Makes those income figures relevant to me seem a lot less enviable.
People are widely expected to work extra hours for free in IT.
This subthread started with CronoDAS pointing out that it's hard to change the amount of money you earn by changing the amount of hours you work, and CoffeeStain pointing out that even if you can't do so in the short run you still can in the long run, because the more you work the more likely you are to be promoted. So, if we talk about the people who can just decide to work more hours this month to earn more money this month, we've come full circle here.
I see, my bad. It's easy to lose the context by reading recent comments.
Yes, that happens to me all the time too.

So for example, by this standard the biggest cost of college for many people will be not tuition, but the time they spent in college that could've been spent working.

Not disagreeing with anything in the post, and I acknowledge that this logic makes sense if you're primarily measuring things in money, but I'd just like to note that this example is likely to come off as weird to the kind of people who like to study but who are unsure of whether there's any job that they'd enjoy. For them, having a socially-sanctioned opportunity to spend several years not working isn't a cost, it's the whole point of going to college.

I spent most of my life up until 2012 loathing the concept of needing/wanting/working for money, and being particularly annoyed when people bugging me about schoolwork would talk about the potential for losing scholarships and employment and all that mess.

I wasn't off campus and doing an online course for two months before I realized how mind-bogglingly stupid I'd been. Well, a fraction of how stupid, anyway; the full extent of it didn't set in until I discovered that my student loan payments were $226 more than I was receiving in SSI. Unfortunately, I think it's safe to consider the majority of my posting on LW to be a prolonged "Oh Shiiiiiiit" at this realization. (A little of this started to set in during 2011, but on a much narrower domain that would needlessly bloat this comment to explain.)

TL;DR: I agree with the article.

Counterpoint: spending 40 hours a week on your job is a huge time commitment. It's also a huge willpower drain (doing worthwhile things requires effort to grind out results, not just time). It's hard for me to believe that the hours money allows you to "buy back" are worth the "wasted hours" on work. So it's important that work not be a waste.

Also, you will probably make more money and do more worthwhile things at a job you enjoy.

Money is definitely a big factor, but I don't think it totally dominates everything else.

I find that when people espouse the notion of "Work hard, play hard" they are missing fundamental facts about human capabilities. Your health is worth money, literally. You start life with a fixed level of savings. Every day you go to work, you are drawing from the bank. I know many people that had high-paying but high-stress jobs, and quit them in favor of lower-paying, lower-stress jobs. And now they spend time cleaning their house too, and they enjoy it (cleaning your house can be relaxing and rewarding). They made the right choice, by any objective metric.

I've got a couple things to say here.

Most of us really are income satisficers, not income optimizers. That is, if you offered me a $350k/year salary to do my current job (grad-student), I would end up distributing most of that money to charity. Not that charity isn't great, but you could have just given the money to charity yourself instead of taking the wasteful intermediate step of paying me.

Why is this true? Because we train ourselves to make it true: frugality is a large component of financial responsibility. For instance, I'm so used to living at a grad-student's standard of living that money above and beyond the cost of that standard of living is pure luxury: I spend it on frivolous bullshit or put it in my retirement account. I'm fairly sure I'm the only 24-year-old grad-student with a Roth IRA topped-up for 2012-2014, and this is because when I got extra money, it went into the retirement account rather than towards consumption, or even towards extra charity.

HOWEVER (yes, the capital letters are justified there), there is an IMMENSE component of class privilege in this whole subject. I am literally the only person I know with this much money at my age who isn't workin... (read more)

This is true for me as well (I'm slightly older), but I also have some sources of income that I expect most graduate students don't. But one of the main reasons why money is awesome is because spending money is rivalrous. My primary expensive hobby is art collecting. I have the number of original paintings I have because I put up more money than the other people bidding on them, and if everyone had more money, then the primary effect would be that the prices increase. When you say we need to exercise our intelligence, let me talk about Franklin Barbecue in Austin. It's quite possibly the best barbecue in the US, and they've sold out of brisket every day that they've been open. Officially, it opens at 11 AM, but generally people recommend that you show up at ~8 AM to wait in line. To the economist in me, this is a terrible setup. They could spend their customers' extra money; they can't spend their customers' wasted time. They should auction off the barbecue, which will raise prices and lower wait times. But it'll also get rid of the communal experience of waiting in line, and less of their customers will be students and more of them will be engineers. The way to get more money to 'food trucks' is to embrace the inequality that makes engineers that will bid on barbecue.

When you say we need to exercise our intelligence, let me talk about Franklin Barbecue in Austin. It's quite possibly the best barbecue in the US, and they've sold out of brisket every day that they've been open. Officially, it opens at 11 AM, but generally people recommend that you show up at ~8 AM to wait in line. To the economist in me, this is a terrible setup. They could spend their customers' extra money; they can't spend their customers' wasted time. They should auction off the barbecue, which will raise prices and lower wait times.

The marketer in me suggests you're off the mark. How do you know that Franklin's bbq is the best in Austin? Because there is always a line and it sells out. The wait in line IS what differentiates their product, and its how people judge the quality in such a subjective market.

I imagine if you start an auction for the bbq, what you'll find is that in a few years you are making less money, as instead of being a good bbq experience that people drive in from all over Texas to try and tourists flock to, you'll be just another good bbq place in Austin.

Them are fightin' words, y'know... :-D It's more complicated than it looks
I'm aware, hence the hedging. I am not a food critic, and am relying on the judgments of food critics. Yes, people rage at high prices, especially when demand jumps and supply falls. And I'm sure that the status threat of the price rising or being priced out makes it worse than just the scarcity. But the right answer probably isn't lotteries. People are unhappier when others receive rewards for merit than they are when others receive rewards because of luck. The right answer almost certainly is efficiency.
This confuses me. Surely if people are made less unhappy by a luck-based distribution, that's an argument in favor of a luck-based distribution? I'm not sure if you typed that backwards or not. I can think of plausible reasons for people to hate both luck and merit distributions.
I view it as an argument against the preferences of people.
So you did mean it as written. I'd kind of like to see the studies, if you have a link. I don't find it surprising, exactly, but it's not a question I'd considered before, and it seems like it would be amusing misanthropy fuel.
Maybe people don't actually believe in merit, in near mode. Maybe they think they do, but they are really thinking about status. Distributions based on merit (that we don't recognize instinctively) simply seem unfair. Distributions based on tranparent luck seem like everyone at least had a fair chance. Maybe the real problem with money is that it usually belongs to people we personally don't know, so we don't know what exactly they did and why exactly should we respect them, so it feels like they really don't deserve the money. And the rest is rationalization.
This is made worse by money anti-correlating with status when all other variables are controlled for, i.e., given two otherwise comparable jobs, the lower status one will pay more.
The right answer to which problem exactly? Temporary shortages of high-status goods aren't exactly a burning issue that really needs to be solved externally.
Locally, the Barbecue Distribution Problem. Globally, the Efficiency Problem. Imagine Franklin Barbecue as one of the broken windows of inefficiency; yes, it only wastes tens of years per year, and they're probably only losing tens or hundreds of thousands of dollars in revenue per year. But efficient markets in barbecue help make efficient markets in other things more reasonable.
I would assume that people who run the barbecue are (1) Aware of the problem; (2) Have incentives to deal with it; and (3) Are not entirely stupid. Given this I am not sure why do you think that what they are doing now is not "the right answer". For example, raising prices might be good in the short term but turn out to be a very bad idea in the medium term. What is that problem and, again, what does it have to do with temporary shortages of high-status goods? And I'm less than convinced that the broken-windows theory applies to global efficiency. In any case, if so, wouldn't you want to start with government, instead? X-/ To give a trivial example, creating such a temporary shortage is popular marketing trick (if the company can pull it off, of course).
I think that (3) is not a good assumption to make, and I wouldn't word it that way. I know lots of artists who have never heard of sealed second-bid auctions (also known as Vickrey auctions), despite those auctions being the optimal way to sell artwork or commission slots online. Are they entirely stupid? No; they just have limited knowledge. Similarly, the barbecue auction problem has a potentially nontrivial complication: there are 5 different varieties of meat sold by the pound (and each variety of meat can either go into by-the-pound orders or sandwich or plate orders), and many people would like either their entire order, or none of their order. How do you find the optimal set of orders to fulfill, and what price do you charge people for those orders, in a way that doesn't skew their bidding incentives? It's a solvable problem, of course, but it's the sort of problem you'd want to hand off to an optimization guy to solve for you, especially if your core competency is barbecuing meat. It might- it's possible that once people could get it by paying more money, instead of more time, it would lose some of the specialness and people would go there less. But it's not clear to me that they would ever reach the point where they don't sell out of meat, and maybe they have to be open for dinner too instead of just lunch. But it could also be that the steady-state long-term price of their brisket is $40 a pound, and they've been selling it at $17, and that it is a fantastic thing over the medium term. (Also, I feel I should mention, since it may not have been obvious: they do allow pre-orders, if you're willing to pre-order by about a month. The amount of pre-orders they allow is obviously capped, so that there's still BBQ available day-of. Auctioning off meat should start as a small percentage of their total quantity moved as a test, and then expanded or contracted as desired. So long as some of it is available by waiting, it is unlikely to lose the popularity.) Bas
Well, then, I see an excellent opportunity for you. You mentioned that they might be "losing tens or hundreds of thousands of dollars in revenue per year" -- surely if you go talk to them and point it out, they'll be glad to pay you some of that surplus that they are leaving on the table. In the best case you'll earn a fair chunk of money and make friends in the BBQ business. In the worst case you'll learn a valuable lesson why theoretical economics doesn't apply to real life too well :-) That's complicated. I understand what you are trying to say, but "thinking like an economist" is not an unalloyed good. For example, consider that economics (especially macro) is really bad at forecasting.
This is, in fact, my plan.
Cool! Do report on success.
If the availability of their product to low-income people is a priority for the current owner, it might be possible to maintain that while raising cash prices by offering menial temp work (such as dishwashing) in exchange for store credit. This is a well-known strategy among restaurants looking to settle accounts with someone who has already eaten but proves unable to pay; the innovative part would be offering a more favorable rate of exchange, and work first for food later.
If jobs are scarce, the restaurant should already have enough dishwashers. Since the restaurant can't temporarily fire one of its existing dishwashers for a week in order to have the nonpaying customer wash dishes, it's hard for the restaurant to recover the money in free labor from the customer. It only works if the restaurant happens to have a job of the right length available I'd expect that to be pretty unlikely. Better just call the police. As a bonus, if you call the police you don't create perverse incentives for more people to stiff you on the bill in the future. I realize your version of the story doesn't include this, but I've often heard it as the restaurant giving the guy a permanent dishwashing job, and sometimes even having the guy rise up in rank and eventually come to own the restaurant. This version is even unlikelier. (For instance, if the restaurant thinks a guy hired this way is better than a guy hired through the normal application process, why do they even have an application process? And if you're in a situation where jobs are scarce, then jobs are valuable things and the restaurant should be able to be very selective in who it hires.)
Of course it's less efficient than hiring an equivalent number of professional dishwashers; the point is to extract more value from the customers by having them choose between paying extra or doing marginally useful work, rather than standing in line.
I can't speak to whether there are any real instances of such a thing happening (the story is only vaguely familiar, I may not even have heard it before,) and I suspect it's more likely than not apocryphal. But the answer to "if the restaurant thinks a guy hired this way is better than a guy hired through the normal application process, why do they even have an application process?" would be "because a single specimen does not invalidate a selection process that deals in generalities." The application process is an attempt at sorting prospective workers to select those who are most likely to be valuable to your business, but that's not to say either that some duds won't get through (people routinely make it through application processes only to be fired for poor performance, after all,) or that a less stringent selection process cannot induct good workers.
thanks for the link. I wonder if it would be feasible for companies to run lotteries for highly demanded goods.
In our economy most shortages are temporary -- the market takes care of them. But lotteries for things in very limited supply certainly exist, see e.g. this
It's not exactly bidding, but I happened to read an article this morning about the $4 artisan toast available in a certain San Francisco coffeeshop, which seems to largely fit the bill. Yet about half the article was taken up by tedious kvetching about how the Bay Area tech industry is driving up the standard of living. One could argue (and indeed I largely agree) that this ignores the artisan toastmaster side of that economic equation, or raise any number of other objections, but that's not the point. The point is that this is a tough political sell. (Statement of conflicting interest: I am in fact an exploitative Bay Area techie.)
The Marxist in me wishes to point out that if you're part of the tech salariat rather than the VC class or real-estate rentier class, you are not in fact exploitative. The fact that the Bay Area confuses "high productivity worker" with "exploitative capitalist" is one of its larger collective errors of thinking.
In the wage / rent / interest model, the skilled person's salary should probably be modelled as a mix of wage and rent. The wage in its pure form is what a completely replaceable employee gets. The fact that the employee is completely replaceable will drive the wage down to the level where it barely covers the expenses to survive. Of course the expenses are different at different places, so the wages will reflect that, but that additional money just goes through you, and at the end you don't benefit from it. The rent in its pure form is what you get for auctioning a use of a scarce resource (such as land). An intelligent person with mathematical skills good enough to work in IT is in some sense a scarce resource. They can be replaced (but you can also move from a piece of land to another piece of land), but it's difficult, and there are not enough skilled people for every employer's every whim. The employers are competing among themselves, and this creates the rent. -- If you could somehow separate your talent from your person, and send the talent to the work while you stay at home and have fun, that would be a rent in its pure form. But because it doesn't work this way, your wage and your rent are connected together. And the interest in its pure form is money making another money. Which you can achieve by investing your rent in an index fund. So a techie can become an evil capitalist, too; it just doesn't happen automatically and requires some strategic thinking.
Ah, that was a pleasant bit of reminder. Thank you. (Though I did mention I have a maxed-out Roth IRA. I very much am trying to become an evil capitalist, on grounds that within this system it is my only rational move, should I desire to do anything other than work for a minimum subsistence. I still want the system changed and overthrown.)
The toast is Josey Baker Bread (yes, that's actually his name; short documentary here) and it really is that good. By which I mean, as another exploitative Bay Area techie, I've paid that price at The Mill more than once and I felt it was worth it.
The toast only manages to be worth four dollars to you because four dollars is worth less to you than to poorer people. (At least in the sense of how much you would care if you lost four dollars and what you would be willing to do to get another four dollars).
Some customers don't have extra money, but do have extra time. (And they can't easily just convert the extra time into money.)
Yes, but when you have more people who want to be customers than who are customers (as is implied by selling out of stock before you run out of line), the question is "who do you exclude?" One way is exclude people randomly. This gives everyone involved a sense of fairness, but no sense of control- either they get lucky, or they don't. Another way is to exclude people by time preference. If they aren't willing to wait, then they aren't going to get any. A third way is to exclude people by cash preference. If they aren't willing to pay the price, then they aren't going to get any. Generally, the only option that benefits the supplier is the last one, and thus it's probably the one that they want to take. There are a few counterexamples; one example that frequently comes up here is concert tickets for young female singers. There are generally two kinds of fans that go to those concerts: young girls who enjoy the music and older men who enjoy the show. The older men are generally willing and able to pay more, but not as willing and able to wait in line. It's unlikely that the optimal experience for all involved is for all of the tickets to go to the older men, and so they might parcel out tickets to different venues in the hopes that they will go to different people while still increasing revenue.
If they raise the price of the barbecue until the number of buyers is small enough to eliminate the line, their pricing will be seen as unfair and this will have a long term affect on their ability to retain customers. While barbecue could produce more profit being sold to rich customers, other more plentiful items need to be sold to both poor and rich customers to maximize profit. And if you lock poor customers out of the barbecue, they won't come in for the other items. Furthermore, it would be rational for poor customers not to buy the other items because of the transaction costs in having to discover which items are priced for rich customers and which aren't. The store could do slightly better by pricing all items for rich customers rather than just the barbecue, but even that may produce less profit than keeping the price of the barbecue low and having more customers for the other items in the store. Another possibility is that people get tired of eating barbecue too often and you need to have customer turnover. If you price the barbecue high enough that exactly the number of rich customers arrive that will buy all the barbecue, in a week from now those customers will be tired of barbecue and there won't be other customers to replace them.

Sure. But consider airlines, and the revenue management they do, as a contrast.

The basic problem is that there is no single price-per-seat at which it is profitable to fly a plane. Imagine the demand curve as something like $1000/x, where x is the number of tickets sold on the plane. Regardless of the price you pick, your total revenue is going to be $1000, and if the plane costs $2000 to fly, you can't pick a single price for every ticket such that the plane is profitable to fly.

But suppose you could offer different customers different prices. The person willing to pay $1000 is charged $1000; the person willing to pay $500 is charged $500, the person willing to pay $333 is charged $333, and the person willing to pay $250 is charged $250. Now you've got a plane in the air, and $83 in profit (and another person paying $200 would get you up to $283 in profit). But this required you knowing which customer was willing to pay what, which is generally done by time-segregation (the amount of time you book the flight in advance, combined with the number of seats left on the plane) which is itself determined by sophisticated modeling.

There doesn't seem to be a public outcry about revenue ma... (read more)

Analogically with the airlines, the current model should be the "economy class" barbecue, and there should be a new "business class" barbecue -- extremely expensive, but without having to wait. Preferably with some additional differences -- sitting in a separate room, with pleasant music and paintings on the wall -- to make it easy to rationalize (by both kinds of customers) it as "paying extra money for extra luxury" instead of "paying extra money for cutting in line".
That model is used by Disneyworld and other theme parks. You can buy a regular ticket, or you can buy a premium pass which costs more but gives you the right to skip the lines at the attractions.
This isn't actually the case at the Disney park in California (not familiar with anywhere else). There are different season passes, but the premium ones just let you get in on weekends and holiday days and what not. They do have "fast passes" but those are available to anyone- you go to a kiosk and get an appointment to come back to the fast-pass line at some later time.
Legoland, for example, sells a Premium Play Pass which gives you "front-line benefits". Universal sells the Express Pass which allows you to "skip the regular lines". Disney, I think, is more wary of PR problems, but still you can buy the (very expensive) "VIP tour" which, as I understand, will allow you to ignore all lines.
Customers prefer constant prices. Aside from the perceived unfairness, there are, again, transaction costs. Any time spent by customers trying to figure out how to get the lowest price is still a loss. Airlines get away with it because airline seats are in limited supply, making it a seller's market. The buyers have to take whatever the airlines give them. There's certainly a fair degree of public outcry about it; the fact that there isn't more is because of a combination of people not understanding it, the fact that most people only buy airline tickets occasionally, and the fact that there's nothing the public can do about it.
Customers prefer predictable prices. They don't have to be constant. E.g., if tickets for an event are $15 in advance and $25 at the door, and this is stated clearly up front, most customers are OK with that... we can plan early and save $10, or we can keep our options open and pay a premium for that privilege.
On net, airlines lose money. In recent years, it seems to be mostly because of decreased demand (due to terrorism fears and TSA harrassment of passengers), and for decades it's been because of price wars between airlines. I don't think this is a market best described as a "seller's market."
That's a very... incomplete prior. Customers also prefer cheap prices. Customers prefer (a lot!) the feeling that they got a deal and bought something on sale. I also don't see what's special about airlines. Pretty much every business would love to price discriminate. Many do through a variety of methods. For example, supermarket coupons are a classic form of price discrimination.
This assumes that a) there is a fixed supply of original paintings, and b) the demand for original painings is income inelastic. Admittedly, I'm not an expert on the art market, but my intuition is that the opposite is the case on both counts: as incomes rise, I would expect people to spend a larger percentage of their income on luxary goods such as art. If this is the case, then, yes, everyone having more money would indeed cause the price of original paintings to go up, but they would rise at a faster rate than less elastic goods, which would cause production of said paintings to go up, which would drive prices back down; the net effect is that more people have more paintings.
I decided to not elaborate on that because the second-order effects depend on why everyone has more money. If it's because everyone is more productive, then there's also lots more art floating around, because the artists are also more productive. I do agree that people who are richer spend more money on luxuries like art, but it's not clear to me that all ways of giving people more money actually make more rich people. But even if there's a bunch more art floating around, there is a fixed supply of the best original paintings, and those will still go to whoever wants to spend the most money at art auctions. (Of course, best is subjective, and so on, but that's part of the point of using auctions.)
"Some" of it they generally do. But if you're going for equality, do note that people are usually paid for the value they produce and that individuals' capability to produce value differs GREATLY. Even if you control for things like socio-economic status.
I half-agree. I'm actually starting to believe that factors like trade, industrial policy, and public regulation of economic rents and public goods (take the preceding concepts apolitically, for the moment, please) have more to do with our current economic crises than any notion of individual "merit". That's not to say there's no such thing, merely that in particular, policies regarding trade, industry, and economic rent seem like much stiffer variables than the relatively loose factors of individual work-ethic or education, or even things like national work-hours. For instance, a country that exports large amounts of capital-intensive goods while strongly regulating its financial sector (say, current day Australia or Germany) seems to be able to afford uneducated individuals, expensive social programs, or short work hours much more easily than a country that theoretically has higher per-hour productivity but suffers a trade deficit and has largely financialized its economy (say, current day America or the UK). What we end up with is that America and the UK suffer massive income inequality, while Australia and Germany are more equal and stable -- even though they're all First World countries with their own top-level educational institutions, labor expertise, and companies. A theory which treats macroeconomic policy as a stiffer (more strongly predictive) variable than individual/company-level merit therefore seems more likely.
I don't understand what do you mean -- I can't see any connection between "individual merit" (and by "merit" do you mean the productive value of a person?) and current economic crises. I don't understand that either. It's not that, say, Germany can afford a more generous welfare system than the US -- after all per-capita GDP is higher in US than in Germany -- it's just that Germany chooses to reallocate more of the wealth produced in this way. Equality isn't a good yardstick -- the old USSR had much more equality than any Western country. And I don't see the stability you're talking about. Stable in which sense?
do note that people are usually paid for the value they produce and that individuals' capability to produce value differs GREATLY That's true, but I still care about people who don't produce much value, and I don't like to see them being impoverished and miserable.
Sure. Nobody says you have to not care about less productive people. So redistribute some of your value to them.
Some might say that exactly that is the problem. (Not necessarily myself.)
To these people I would point out the difference between reality and various imaginary universes one can construct.
Is that a new version of the is-ought fallacy?
Kinda. It's really more of a confusion between what the world is and what you would like it to be.
-2Jonathan Paulson
I have heard this claim repeated many times; I would love to see some evidence for it.
As a trivial example, severely mentally retarded people are unable to produce almost any value. A surgeon is able to save lives routinely.
Under the conventional economic definition of value, compare how much value is produced e.g. by successful start-up founders compared to a low-IQ guy who is on welfare and will stay there for the rest of his life. Or, say, compare the value produced by J.K.Rowling to the value produced by an airport TSA agent.
0Said Achmiz
Was this downvoted only due to antipathy for startups*, or for some other reason? It seems true in general. I'd love to hear from whoever downvoted it (or agrees with the downvote). *Which I somewhat share, so no disparagement intended there.
Think this post was just an innocent bystander in some downvote machinegunning.
The obvious answer is: Make as much money as you can, retire early, and then spend your time solving this problem. For example, you could start giving poor people free programming lesssons. Or even donate them computers. Or think about something smarter and more effective than this.

For example, you could start giving poor people free programming lessons.

I've seen this suggestion elsewhere. I'm all in favor of it, but it kind of bugs me anyway. The assumption is that most people can learn to program (or do other forms of IT) if taught. I don't think that's the case. Programming well is hard. IT pays reasonably well because good IT people are hard to come by, and I don't think lack of access to training or facilities is the reason. Certainly not since OSS became widespread.

Any widespread solution to poverty has to work for people that don't have hacker-natures or Mensa-class IQs.

Yeah, it's a solution of type "pick a few people who are easiest to save, and save them, ignoring the rest". It's worse than solving the problem globally; and it's better than doing nothing -- which is what most people will do; including most of those who like to think about global solutions. It's far from optimal. It's also something that one can do as an individual -- so it can be used as a backup plan is case no better idea comes around.
2Jonathan Paulson
Assume that 1% of people could become good programmers. If we trained (or offered training to) 10x as many people, we would still end up with 10x as many programmers. I grew up with computers in my home; I had a programmable calculator in middle school; my high school offered programming courses; my family could pay for me to go to a very strong CS university. Not everyone has those opportunities.
That assumes a random distribution of potential programmers. Isn't IQ highly correlated with both familial wealth and programming ability? I doubt anyone's compared the programmer-nature with wealth directly, but if the two are also highly correlated, that 1% could mostly already have access to the training they need. Offering to 10x more would just get you (slightly less than) 10x more bad programmers.
7Peter Wildeford
Or make as much money as you can and then spend your money solving this problem.
I actually tried to donate to them, and they claimed my card was declined. So does NewEgg. I think some of these processors aren't equipped to handle debit cards, apparently, since both and CareerVillage have proven capable of "shutting up and taking my money". Further pity, the Rolling Jubilee had stopped taking funds for the year. They're a favorite of mine: they buy up defaulted, second-hand debts of the housing and medical kinds that cripple people so damn hard, and then just abolish them. People who were being hounded by collectors get a call and find out their catastrophic debts are just gone.
5Peter Wildeford
A potentially easy way around the problem is to donate through GiveWell. Failing that, you could try via Venmo.
Damn! Bloody hell!
Perhaps you should get an actual credit card as well as your debit card, for use with vendors and charities that can't handle debit cards. (I appreciate that there are a number of possible reasons why you might be unwilling or unable to do that. They may be very good reasons. It's probably worth spending a few minutes, if you haven't already, considering whether they are good enough to outweigh being unable to donate to entities you would like to donate to, etc.)
I had no problems donating to GiveDirectly with my debit card; OTOH now I'm having trouble giving to CFAR via PayPal using the same card, which had never happened before to me. (I guess I exceeded my daily quota for Internet purchases.)
The thing is that it's supposed to function as a Check Card, able to be swiped as both credit or debit. This is actually the first time I've ever found anyone who won't take it.
0Peter Wildeford
Don't they then get a call from the IRS saying they have to pay taxes on this gift?
That sounds like it might be a frequently asked question! Let's check Rolling Jubilee's FAQ... yup! Point being, if you can think of a difficulty in the solution of a problem in two seconds, then the people actually working to solve the problem have almost certainly either anticipated or run into the difficulty and have dealt with it.
Point being, it's not up to the Rolling Jubilee to decide. It's up to the IRS to decide. If the Rolling Jubilee wants to be serious about it, it needs to get a Determination Letter from the IRS stating that yes, IRS will treat these debt cancellations as tax-free gifts.
Yup. Have a look at that interview with the top tax lawyer to see how that will likely play out. (Short version: 1. Medical debt is likely much easier to forgive tax-free than mortgage debt. 2. The debt forgiveness is currently so small that it will probably be lost in the shuffle without the IRS wanting to devote resources to making a determination.) The point of my comment was really that if James_Miller had posed the question out of genuine curiosity instead of as a rhetorical side-swipe, he could have found the answer.
Fantastic! Now I can escape the tax liability on my paycheck by having my employer pay my debts rather than directly paying me a salary. Or, rather than contribute to MIRI and have some of this money go to salaries which are taxed I could instead payoff some of the debt of MIRI employees. Sorry for the sarcasm, but for someone who has studied a bit of U.S. tax law it's obvious that the IRS can't allow Person A to payoff the debt of Person B without there being any tax consequences. Doing so would just create too massive a loophole for tax avoidance.
I think Rolling Jubilee has a better case for forgiving debt as an "exempt purpose" than you're giving them credit for. In any event, EY noted recently (on Facebook, possibly?) that the legal system is made of people, not words. An obvious cheat won't cut it. (I can hardly complain about the sarcasm, having dished some snark of my own. It's all good.)
It seems that (1) in practice, so far they apparently don't, but (2) no one is quite sure whether they should. (Or, rather, a few people are sure they shouldn't, a few more are sure they should, and lots of people aren't sure.)

On the topic of house cleaning, I think that a lot of people (including myself) just really don't want to see strangers in their homes. If rich people generally don't have problems with that means there are some psychological differences. When reading historical fiction the fact that even middle-class families had servants looks really weird.

Rich people's servants, and even middle-class people's servants, were live-in members of the household, and as such not strangers. The risks would be rather below those of an employee stealing from the workplace. Which does happen, but workplaces still work. And in a household that had someone come in to "do for them", the woman of the house would customarily have been at home.
Just have them do the cleaning while you're somewhere else, like at work.

The same psychological processes that make you not want to see strangers in your house might also make you uneasy about having strangers in your house when you aren't even there to see what they're doing. (Anecdata: I would feel a bit creeped-out about either, and a bit kinda-rationally worried that they might steal things etc. Both worries would be worse in the case where the stranger is in the house and I'm not.)

Having a stranger in my house when I can't see them is much worse. No fucking way I'd put up with that.
I suspect that it worked historically because the amount of power you could wield over a servant was so immense that you could destroy the servant's life based on any amount of suspicion you like, even if it wasn't enough suspicion to get the servant arrested. Kicking the servant onto the street without a social net would be really damaging, since the servant depends you for food and shelter, not to mention that spreading the word that the servant is unreliable could lead to the servant becoming unemployable and starving. Alternately, you probably could hurt the servant in other ways, such as by retaliating against the servant's family. Or just have someone beat up the servant and count on the police to look the other way. That sucks for the servants, but it makes having a servant relatively safe for the employer. I would also imagine it's one reason why rich people like to use illegal aliens as servants. If the servant steals something it may be impossible to prove in court, but you could always get the servant deported.
Oh, such modern and un-British crudeness! The way to deal with an unsatisfactory servant in the old days was merely to discharge them without a reference. It would be almost impossible for them to find a situation again, and with no welfare state they faced destitution. In modern times, you are right about the use of illegal aliens, who are in a weak position to resist exploitation.
Isn't that the same as kicking them out on the street without a social net? That's true, but my point was more that being vulnerable to exploitation also leaves them vulnerable to retaliation for their actual misdeeds. You might be willing to pay your servant well, but the same factors that ensure you don't have to pay your servant well also let you prevent your servant from stealing and breaking things.
If the servant is employed by a big house cleaning company, the situation might also be different. Businesses don't want bad reputations either, and they will have internal mechanisms to deal with that. It's also easier to track the reputation of a business than an individual, and hire a house cleaner from a reputable company than try to hire a reliable servant yourself.
Interesting. In Finland house cleaning services are usually provided by big companies with native workers and I think they usually do the cleaning while people are away. It's easier to track those companies' reputations than to try to hire a reliable house cleaner yourself. Giving the company a copy of your key is migitated by having two locks (which is the default) and designated hours of service. Perhaps a different kind of an image was evoked in your mind based on where you live? I probably wouldn't put up with this kind of a scheme either if I had enough stuff worth stealing in my house that I couldn't reliably keep track of and my insurance sucked. I couldn't care less if strangers visit my house while I'm away if they don't steal (or plan to steal) or destroy anything.
Finnish, wouldn't let unknown cleaning staff in my house unwatched. I'd need to get a safe, and I still wouldn't know that there isn't going to be an off-the-shelf hardware keylogger in my PC that will go live the next time I go online banking when I get back. I'd probably be fine with strangers cleaning my house if I didn't need to worry about identity theft and digital security though.
I hadn't thought of a hardware keylogger, but incidentally I have a lock in my PC case and the USB ports are visible. Do you know in what kinds of ports you could plug an off-the-shelf one? With the relevant skills you could probably plug a DIY one almost anywhere. House cleaners are probably the antithesis of tech oriented people unless they do the cleaning for the specific purpose of cyber-theft, which could be convoluted if the companies require any kind of certification in cleaning. Ideally I would design my apartment as theft-proof as possible regardless of services from strangers though, so can you come up with any other scary scenarios?
No idea. The whole idea is that I shouldn't need to know much about physical data security on the principle that untrusted people can't physically access my machines. I'm thinking of an organized crime operation that uses the house cleaners for easy access to people's homes and a ready-made hardware attack designed by someone else that the house cleaner just operates by rote instruction. Also, I'm assuming the standard stereotypes for menial workers being utterly technology illiterate apply much less to anyone under 30 who grew up in a country with ubiquitous IT.
I don't think theft is my whole concern/squick here. I get upset when my possessions are moved to places that don't match my intuition. Back in college the cleaners put my shoes in the closet once and I couldn't find them for a month because they go by the door dammit. Which was OK, because it was college and I wasn't taking any labs at the time, but still. Privacy is also pretty important to me, both for visceral and practical reasons. Practically, there are plenty of legal hobbies that look very similar to illegal activities, and people are ignorant. I have heard of enough cases of neighbors mistaking tomatoes and okra for marijuana that I really don't want to count on strangers believing that the white fuzz in those jars is going to become tasty oyster mushrooms and not some other kind of mushroom.
(As Finnish), my reaction to the thought of employing a cleaning service is approximately the same as kalium's.
Why do you think it's so?
Not sure. Combination of general preference for privacy, and also awareness of the fact there's a bunch of stuff that a malicious person could do in my apartment to inconvenience me later on that wouldn't be immediately apparent. (E.g. steal something inconspicious enough that I'd just think I'd misplaced it, or look at papers with my personal identity number for use in identity theft.)

... The point of picking a job you somewhat enjoy is very simple. If you do not, getting any good at your job will require colossal amounts of willpower. And it is pretty unlikely you will ever get "big-bux" awesome at it. Therefore, choosing careers solely on the basis of the money is every bit as stupid as common wisdom holds. The top two most likely outcomes of doing so are;

1:You turn into someone who enjoys that job and the pursuit of wealth as end goals in themselves no matter how horrifying that person is to your present self.

2: You are, in fact, not really that good at your job. And don't get the big bucks.

Not saying you should ignore the money - Money really does matter. Just that it is a bit of a false choice - consider the money, yes, but also, consider if the day to day is something you can engage with.

There are jobs for which being smart and working hard pretty reliably produces biggish bucks, even if lack of motivation means you never get exceptionally good and therefore never get what counts as "the big bucks" within that career. Someone who happens to have roughly the right mental aptitudes and is willing to work moderately hard can make what's by most standards a very good living in software development, even if they're not entirely gripped by their work and never become a superstar. Someone who happens to have roughly the right mental aptitudes and is willing to work very hard can make what's by any standards a very good living in finance, even if they're not entirely gripped by their work and never become a superstar.
Finance is a cancer. As in, it used to be a useful organ in the body politic, but it has grown beyond reason and is strangling and poisoning everything. Going into a career in that field is strongly inadvisable at the present date, even from a pure self-interest perspective. Being at ground zero when the world comes to its senses and regulates that sector with fire is not going to do your long term prospects any good. Coding at least produces added value to the world, but I never did meet a programmer who was any good that didnt like to code. So.. "I find your examples very unconvincing"

Finance is a cancer ... and is strangling and poisoning everything.

That looks to be way too much emotion and not enough reason.

when the world comes to its senses and regulates that sector with fire

Are you making a prediction, by any chance? If you believe it, you can bet on it -- will make you very rich if it were to happen...

Given the way the FIRE sector has eaten up the pie of corporate profits in the developed world, with non-FIRE companies often losing money even as FIRE grows, I believe the cancer metaphor is apt. Even "rationalists" are supposed to feel emotions when they match the reality. If finance is eating the economy, we should get mad at it and call it a cancer. And finance indeed appears to be eating the economy (warning: the paper's author has some political views, but the statistics are sound: finance is capturing increasing portions of economic output, which Should Not Happen unless their ability to minimize risk/predict the future has increased that quickly).
It might be difficult to get very rich that way. Suppose Izeinwinter's opinion is that there's a 75% chance that some time in the next 20 years the financial industry will be struck hard by regulation, in a way that turns finance from (at least in, er, financial terms) a very attractive career to a rather unattractive one. The most obvious bet to make on that isn't going to pay out for another 20 years, and s/he still might well lose (75% < 100%), and even (say) a certain 5x gain over 20 years wouldn't be much above what one could plausibly hope for from, say, the stock market. And I can't imagine there being a big supply of people willing to take the other side of that bet for a large sum and offer 5:1 odds.
Not really. Deep out-of-the-money options can provide a LOT of leverage. Well, he is posting here so he can tell us what his opinion is, if he wants to, of course.
That assumes that nobody passes a law that makes enforcing contracts about deep out-of-the-money options impossible. If you believe in serious actions against the finanical sector there might just not be a trustworthy counterparty for the deep out-of-the-money options that will pay 20 years in the future.
Then have them post daily collateral.
What do you mean specifically and how would you go about buying such an option contract?
Those numbers are close enough, but that is not why I am not setting up a global short on the finance institutions of the world. I am not doing that because if I am proved correct most of the potential counter-parties to that deal will be first against the metaphorical wall, and thus I do not get paid either way. Look, for most of the history of capitalism finance and banking is where mediocre intellects with high conscientiousness scores went to earn a respectable boring living in a respectable boring job. The current status quo is an aberration, and will keep blowing up until it is stopped. None of the bullshit that led to the financial crash has actually been fixed, because finance had too much pull with politicians. Its going to happen again. Soonish. Politicians will not be able to shield them a second time (and if they try, very worrying people will replace them in office)
A fair point. However if you think that scenario is likely I would recommend to buy ammo and beans and not worry about high-tech things like AI. That is not true at all. It is so for accountants and tellers, but it is true for them in our days just as well. People who owned and managed high-level financial and banking institutions always had high risk and, if successful, high profits. Think about financing trading ships half across the world, financing wars and shaky monarchies... The big banking houses did not rise through efforts of people with "mediocre intellects [and] high conscientiousness scores".

The big banking houses did not rise through efforts of people with "mediocre intellects [and] high conscientiousness scores".

Mediocre compared to whom? Certainly, from what I've heard, the skills necessary for banking are, in this order:

  • Consciousness/Work Ethic
  • Ability to socialize with the upper classes
  • Intellect

With the general level of intellect being roughly "can pass freshman calculus but not necessarily an entire engineering degree." Certainly bankers aren't stupid, but if you compare their job to what's necessary in science, medicine, professional engineering, or law, I do think they're the "dumb jocks" of the smart crowd.

It's the term you used. I assume compared to the general population. What do you call "banking"? As is true for every complex industry, there is a variety of things to be done which require diverse skills. An accountant, a salesperson, and an executive might all work in a bank but the skills they need are very different.
It appears in fact to be the term Izeinwinter used; so far as I know, Izeinwinter and eli_sennesh are not the same person.
Yes, this is correct.
First of all, I was not making any recommendations. Just pointing out that you can get quite big bucks even from a job you don't enjoy very much, in some fields. Second, taking the moral rather than the pragmatic aspect of your comments about the finance industry: I think it's clear that (a) the world has more people in finance than it needs and (b) some people in finance have been responsible for a lot of harm -- but going into finance could still, for an individual, be the best thing they can do for the world. (By getting paid a lot of money, and then giving a lot of it away in a way calculated to do as much good as possible.) There's a post on the 80000 Hours blog that does some calculations and concludes that even with very unfavourable assumptions someone who can do well in finance can do a lot more good than harm that way. And, of course, the fact that an industry has been responsible for some very bad things doesn't mean that everyone working in it is doing a lot of harm; it seems pretty clear to me that a lot of what happens in the field does (to a very good approximation) no overall good or harm at all. And if a person of good conscience goes into finance, they're probably in effect displacing someone with fewer scruples and may even on balance make the world a slightly better place by their work. On the pragmatic point: If your prediction is correct, and some time in the nearish future it is likely that the finance industry will be hit by legislation that costs a lot of jobs and hugely reduces profits, then indeed it would be a bad career choice. I have to say that it doesn't seem a very plausible prediction to me. (This seems like the sort of discussion where disclaimers like the following may be useful: I do not work in the finance industry -- I'm at a small technology startup -- and neither does anyone close to me; but I'm a mathematician, lots of mathematicians end up in finance, and it's not impossible that I might work there some day. I would have

Not disagreeing, but an awful lot of people with a lot of money seem incredibly bad at spending it on anything they care about; often it seems like most of it goes on positional goods. I'm with Jarvis Cocker here.

Are you referring to this?: Depending on how you interpret it, "enough money that you don't have to think about it" could mean a lot of money. And given that this is a famous musician talking... To expand on Lumifer's point, maybe most people really do care about positional goods. Or rather, they care about the status positional goods bring (and various indirect benefits of status). After all, there does seem to be a lot of independent evidence that most people care a lot about status.
And I'll make a stronger point as well: people rich enough so that their "basic" needs are fulfilled effortlessly and semi-automatically care about status goods a great deal more than people who have to make budgets and worry about money. A guy who buys a yacht and parks it in the marina "doesn't use it" from one point of view, but does successfully use it from another point of view which considers that as a symbol of wealth and status it works perfectly fine at the dock (actually, works much better at the dock that in the open sea where not many people can see it).
3Paul Crowley
I really don't think it works for them - they keep changing their up their peers until they're not high status any more.
Not high-status within their peer group anymore, you mean. I've heard people talk about this, and for many of them it may not be what they really want, but some people may value being part of a high-status peer group. (What we really want to know is this: how often do people set out to make money with one purpose in mind, but get sucked into spending more and more money on positional goods they didn't originally want?)
0Paul Crowley
BTW I was thinking of "What's the point of being rich, if you don't know what to do with it?"
How do you know what do they care about? Revealed preferences are revealed.
If it causes them stress, or they don't use what they buy, it's an indication.
Would Your Real Preferences Please Stand Up?
I don't put much stock in "revealed preferences." Humans are massively inconsistent. Our minds are a bunch of disparate processes operating over different domains hacked together, we respond differently to the same dilemmas framed in different ways, we can be money pumped, we can exhibit or avoid biases depending on how we're prompted to consider a situation, our systems for liking and wanting things operate independently, and so on and so on. Even if human preferences were coherent, what people's spending habits revealed about them would still contain a great deal of ambiguity. For instance, a week or so back, I gave money to a Buddhist monk soliciting for charity. Do I consider this a worthy use of my money? Absolutely not. It still pains me to think that I spent it in that way. I used to struggle with extricating myself from social situations with solicitors without giving them money, and I thought that I had moved beyond that, but it turns out that when the solicitor is a saffron clad monk with minimal English fluency, my difficulties return in full force. So while the fact that I can be induced to give money to a begging monk is a significant piece of data about my behavior, it would be a mistake to conclude that I'd be doing it out of a considered valuation of what the monk will be spending the money on, or for the experience of warm fuzzies, or for the signaling value of having people see that I give money to monks.
I think you're reading more into this than there is. "Revealed preferences are revealed" Notably, this says nothing about whether humans are consistent or whether their preferences are coherent or unambiguous. In your example you're drawing clearly unsupported conclusions from your action and then point out that they are unsupported. Well...
I don't think that it's very relevant to note that people care about the things they spend money on in some sense, if the people do not actually approve of or enjoy their purchases, and will stop spending their money in those ways, and be happier as a consequence, if they can avoid having the purchase opportunity presented in certain contexts. If I'm reading too much into your statement, could you explain what the significance of it was to begin with?
It was a pretty simple observation. ciphergoth said: It seems to me that the evidence of spent money is better than general (and as far as I can see, quite unspecified and unsupported) ideas about what rich people might/could/should/would care about.
That I would definitely dispute. Rational spenders, whose buying habits are well adjusted to satisfy their own preferences, are to the best of my experience as mythical as rational voters.
Really? Let's take a random member of the Walton family who is stupidly rich but about whose preferences we know nothing -- an uninformative prior. We learn that he commissioned a megayacht. Now, do you want to update towards "He's interested in boats" or do you want to update towards "He spends his money on something he won't enjoy"?
Having known a few yacht owners in my time, I very much would update toward the latter. I often think that the point is "having a yacht" and not at all the yacht in itself.
In which case you want to update towards "He's buying himself a bit more status" which still seems entirely reasonable to me :-)
It might sound reasonable, but that's a very different matter from the purchase actually being an effective per-dollar way to get something that will actually make him happy. Would knowing that he's commissioned a mega-yacht make me update in favor of the proposition that having a megayacht would make him feel happy or fulfilled? A little bit, sure, it's better than nothing. But I would absolutely weight his thus "revealed" preference less strongly on that question than I would the evidence of simply asking him what he thought about yachts, and even that is pretty shaky evidence.

Chris, I appreciate your zeal and the argument you've formed given the information you have. You have correctly pointed out a fundamental logic flaw with the "get a job you love" mentality, and your alternative is certainly worthy of consideration.

As rational agents, we should be inclined to pick a model which is more robust to empirical data (given the same degrees of freedom). From your post I infer that you are not an economist, so you might be unfamiliar with the "Easterlin Paradox," which shows that indeed wealthier people within ... (read more)

there are two ways to maximize the amount of time you spend doing things you enjoy: find a job you mostly enjoy, or else find a high paying job you hate and work part-time / take frequent long sabbaticals / work hard when you're young, then retire early.

I'd keep in mind the possibility here that by working at a high paying job you don't enjoy and then retiring early, you reward yourself with the opportunity to do things you enjoy when you're not only old enough to have lost a lot of opportunities, but possibly significantly embittered by an unhappy care... (read more)

It turns out that it's not clear this is actually true—some studies have found more money leads to greater happiness up through the highest income levels examined.

The "highest income levels examined" -- based on the chart on that page -- appear to be 128k/yr. Since the income satisficing level (for an unattached individual) is ~75k, this doesn't seem like good evidence one way or another.


Attention conservation notice: the comment below is not substantive at all.

For the pedants, to say something is an exception that proves the rule is to say that when you look at the exceptions, they're so unusual that it reinforces the point that the rule is generally valid even though it isn't universally valid.

Actually, for the real pedants, to say something is an exception that proves the rule is to say that an explicit written exception to an implicit rule is evidence that the implicit rule exists, e.g., a sign that says "Parking prohibited o... (read more)

I find it a fun game trying to think of things that money can't buy (but that it is possible for people to get in other ways). It's difficult to think of a lot of answers, especially allowing for strategies like hiring someone to train you to become the kind of person who gets x. The best answer I've been able to come up with is specific anything, such as the friendship of a specific person.

IQ seems to be the one obvious thing. A variety of inner emotional states. A lot of personal achievements. Things like honor.
You can't buy IQ points directly but you can buy things like the CFAR bootcamp to improve your thinking abilities. On practical level 3 things can limit your intelligence: 1) Available time to spend training 2) Unclear information about which training might help 3) Money to pay for that training
You don't believe there is a cap for IQ that's basically fixed by adulthood? Do you think that with enough training you can raise someone's IQ from, say, 80 to 120?
Can it be done? Is it possible to learn this power? Not from a Jedi. Using a years-long bootcamp with a brainwashing-type regimen, studying IQ-test questions and strategies day-in and day-out, maybe. Not that there are any studies to the contrary (under such conditions).
I'm talking about actually raising IQ, not about passing tests better.
And here I thought IQ is that which is measured by the IQ test. That, or people are missing a lot of disclaimers and caveats when providing IQ scores when asked for IQ.
Well, if you want to get technical, the IQ in the expression "I'm talking about actually raising IQ" means the underlying general intelligence factor g which is unobservable directly. The results of IQ tests are estimates of that underlying factor g and for different IQ tests these estimates might be pretty good, pretty bad, biased, etc. In particular, if a particular IQ test looks strange to you, its estimate of your g is likely to be biased downwards and, vice versa, if you prepared very diligently for a specific test, its estimate is probably biased upwards.
IQ as often measured is made up of both fluid and crystallized intelligence, and you can certainly raise your crystallized intelligence. (I find learning pretty much anything to be easier now than I found it ten years back, probably due to me now having more background knowledge to draw on and connect things with.) It's the fluid part that's the problem.
Having a highly developed work ethic works too for older people.
Yes, but that's not interesting. What's interesting is whether developing a work ethic works for older people, i.e. whether you can raise conscientiousness. And that's a completely different issue.
It depends very much on the specific person. I think there are plenty of people for which a single heath care intervention can change IQ from 80 to 120. Interventions that an expert with a 2014 level of knowledge could think of. Do I think I know how to turn the average IQ 80 person to an IQ of 120? No, I don't. Do I think that if you would give me twenty billion dollar and twenty years that I could research with that money how to turn the average IQ 80 person to an IQ of 120? Maybe. I would consider that plausible.
Adults? It is well-known that a bunch of things (e.g. iodine deficiency) will suppress your IQ. And yes, there are (genetically) bright kids made stupid by their environment (deficiencies, malnutrition, trauma, etc.) and in a counterfactual universe where these deficiencies don't happen the kids would grow up to have higher IQ. But almost all of IQ suppression happens in childhood and I don't know of "single heath care interventions" which would raise the IQ of an adult from 80 to 120. What kind of interventions do you have in mind? You consider that plausible based on what evidence? Think e.g. about the economic effect of converting the stupid part of some country's population to smart people. It is enormous and would completely dwarf the 20Bn price which is what, a rounding error in the US Federal Budget?
Rounding error or not, it's not easy to get research funding in that kind of quantity. $20bn is about twice the annual budgets of Stanford, MIT, and Caltech (including the JPL) put together, or about NASA's annual budget (in late 2000s dollars) at the peak of the Apollo program; we're basically talking in terms of creating a major research university out of thin air and devoting it to one problem for two decades. I don't think it's unreasonable to suggest that you could develop some quite interesting things with that level of resources, although I'm not neuroscientist enough to speak of intelligence research as such. In any case, contingent on such a program existing, I think I'd expect its bottom line to be dominated by implementation costs, not R&D. Education on a mass scale isn't cheap. Neither are most medical procedures.
Anything that moves someone from level 10 pain to painfree has probably that effect. If I put a 120 IQ person on level 10 pain I doubt they will get over 80 points on an IQ test. The mnemonsyth data is laying around for years without anyone analysing them to find more effective algorithm for human learning. Paying some quant who actually knows something about statistical modelling to take on the task is relatively cheap. Probably less than 100,000$ for a result that matters significantly for improvement of general cognition. That's an example of a very obvious area to invest money if you care about cognitive enhancement. As a result I don't see the world in a way where a lot of people are seriously trying to advance cognitive enhancement who are understanding the landscape well enough to direct funds to obvious areas. I think it's even worse if you look at nonobvious but potentially good ideas that cost a bit of money. I do approve of CFAR but we don't live in a world where they have billions of dollars.
Personally, I don't expect much from the data. From reading through scores of papers comparing minute differences in spacing and getting contradictory results and small improvements, I get the impression that once you've moved from massed to spacing (almost any kind of spacing), you've gotten the overwhelming majority of the benefits, and the rest is basically frippery which needs a lot of domain expertise to improve upon. I understand Peter hasn't looked at the Mnemosyne data much either because it didn't indicate to him that the fancier SuperMemo algorithms were much help. But I could be wrong. I haven't worked with the Mnemosyne data very much beyond looking at correlating scores with hour of day and day of week; I've been waiting for the data to import to SQL to work with the whole dataset. (So far I'm up to 81%... I'm hopeful that the 1TB SSD I just ordered will help speed things up a lot, and then I can host the SQL on Amazon S3 or something for anyone who is interested; a quick estimate is that it'll cost me ~$5-10 a month or $60-120 a year to host, but I figure that I can solicit some donations to help cover it. If nothing else, it'll save Peter a lot of time and effort in uploading the raw logs for each person who asks him. EDIT: the SSD sped things up even more than I expected: processing time goes from months to ~25 hours. So I deleted it and am fetching a fresher dataset to process & distribute.)
What do you think are the prospects of a SRS that uses a forgetting curve specific to the individual, by relying on past performance? Has this been tried or considered?
You can already modify the forgetting curve yourself in most SRS based on your needs via a constant. Unless an automatic algorithm goes with the personal best past performance, I expect a continuous decay of performance using such an algorithm for most individuals. I think Anki already automatically modifies intervals of individual cards based on your past performance i.e. the experienced difficulty and instances of forgetting, for example. New cards are not affected by past performance, as far as I know.
You need to specify which parts are being modified by an SRS system: each card has an easiness parameter and that will be continuously modified based your performance, but I don't think existing SRS systems like Anki or Mnemosyne will modify other parts of the curve like the exponent. For example, SM2's algorithm runs in part based on updating the easiness as EF+(0.1-(5-q)*(0.08+(5-q)*0.02)) - the EF will be progressively updated, but the formula itself never changes even if 0.1 is not ideal and 0.15 would be better or something.
Both Peter and Damien think that the further SuperMemo algorithms provide no benefit. As far as I know they make they don't make that judgement because of data but because they have a feeling the the algorithm isn't better. Piotr Wozniak who actually did run the data claims: I don't think that's it's certain that Piotr is right. On the other hand if he's right that's on a scale that matters a great deal. If you are better at estimating when a card will be forgotten you are also nearer at the point where you do deliberate practice that might make you better at learning. The second issue is daily memory performance variation. I'm not sure but I think there might be days when the brain doesn't work well at storing memories. If you answer 200 cards on such a day and they get sheduled into the future and you get 20 of the first 30 cards wrong when they get tested again it would make sense to reshedule the rest of the 170 cards to a time closer to the present. We do have practical issues that the present algorithm doesn't handle well. You can't tell the present algorithm that you want to really know all the facts in a deck at a particular date when you write an exam. Having a stable mathematical theory that can predict when a card would be forgotten can help towards that end. You might also think about the kind of tools that psychologists use to measure a trait like unconscious racism in the present. Words or images get flashed for short time durations. You might measure unconscious racism the same way through testing people long-term memory for the ability to remember related information. If you both have the tool of flashing images and the tool that measures the effect of unconscious racism on long term memory you can start asking questions such as: "Which unconscious racism metric changes first and which lags behind?" The Mnemonsyth data doesn't allow us to answer that question but it can provide a foundation on which the mathematical theories for long-term me
I'm not sure what data he has run; skimming that page doesn't help much. I know he has no dataset comparable to the Mnemosyne dataset because I sent him my initial results a few months ago and he told me so, so it can't be based on that.
At the present time he has Supermemo Online and that should provide an interesting data set. But I don't think he had that dataset at the time he wrote those lines. I think Piotr worked a lot with his own data. But he also writes: He also described it in his thesis in a bit of detail. 32 test subjects does not compare to the Mnemosyne dataset but it does provide plenty of data for testing algorithms and the might be enough data to decide that SM-8 is significantly better than SM-2.
Oh please. And how is that relevant to this discussion? I think you're confused between IQ, learning, and memorization. These three are all different things.
The fact that you haven"t thought of trivial examples that show that the theory in which you believe is wrong illustrates an error in the underlying model of what IQ happens to be. There are huge gains through physical changes and removing obstacles that keep mental functioning down. No, I'm not. I don't expect a person who's bad at allocating resources to advance memorization to be good at allocating resources about IQ. Secondly, if you want to improve IQ than it's useful to have a good model of how human cognition works. Having people with good mathematical skills analyse the massive pile of data behind spaced repetition learning not only provides us with the practical benefit of having better spaced repetition, it also tells us something about human cognition. If you want at the way of inefficiently smart programmers use their nervous system, look at those programs who have back pain because they tense up the wrong muscles at the wrong time. From a big picture way it's incredibly stupid to tense up muscles in a way that makes your back hurt. But it happens because those smart people have nearly no awareness or control of what their nervous system is doing. I see more and more examples of people behavior very far away from optimum because of lack of knowledge/skills.
Is there anything remotely like that going on in a non-trivial fraction of the population? The closest I can think of is sleep deprivation, but I'd be very surprised if the effect of non-extreme cases of it is more than 10 IQ points, let alone 40.
Purely from introspection, I would bet that sleep deprivation costs me less than 10 points of IQ-test performance but the equivalent of much more than 10 IQ points on actual effectiveness in getting anything done.
My introspection had similar results about sleep deprivation and mental performance before I tried Anki. Now that I've actually measured my performance with the software, I know it can be as low as 50 % of my peak performance measured in latency of recall when even slightly (2-3 hours) sleep deprived. Of course, Anki measures memory, not IQ. This experience made me update significantly in the direction that my introspection, at least in the case of mental performance, sucks. My social life has suffered as a result of this realization.
Of course I'm speaking with hindsight here, but it doesn't seem at all surprising that you could be as much as 2x slower at some mental tasks when sleep-deprived. I'd expect that to translate to less than a 10-point loss in IQ-like tests -- maybe that's unrealistic? How has your social life suffered?
I keep a pretty strict sleep schedule and drink very little alcohol. Almost any nightly socializing is gone, and there used to be a lot of that. I see this as a net positive though.
Ah, I understand. Thanks. You've doubtless thought about this already, but I'll say it anyway just in case: Your happiness and net effectiveness (at whatever you seek to do) may be affected as much by your network of friends and associates as by your own mental performance. Trading in social life for increased sharpness may be far from an unambiguous win.
My scores at stuff like Lumosity and Quantified Mind tend to always be great in the morning (a couple hours after I wake up), but unless I slept enough the previous night they suck balls in the early afternoon; they get better again in the evening if I take a nap in the afternoon. My self-perceived wakefulness and willpower levels vary similarly, but several hours earlier (i.e. I underestimate my mental performance right before lunch and overestimate it right after my afternoon nap).
Stanley Coren put some numbers on the effect of sleep deprivation upon IQ test scores. There's a more detailed meta-analysis of multiple studies, splitting it by types of mental attribute, here: A Meta-Analysis of the Impact of Short-Term Sleep Deprivation on Cognitive Variables, by Lim and Dinges
I've finally managed to upload the data; see
OTOH Lumosity data has been being studied.
Sort of. The data isn't open. There are studies that they published based on the data but it's hard to know how much they cherry picked the studies they decided to publish. There a huge commercial incentive to make Lumosity training appear better than it actually is. Spaced repetition system data has other advantages. I don't really care about whether I get better at the task of completing a random Lumosity game. On the other hand getting better at remembering any fact that can be displayed via Mnemonsyth or Anki is a valuable. I would also think that there the performance at Anki correlates with other learning tasks. SRS data provides you a variable that tells you how good you are at a given information at saving information to your long term memory and it gives you information about how good you are at accessing information from the long term memory. To recap what we mean when we say IQ, IQ is about how your g-value is relative to other members in your population. What's that g-value? If you take a bunch of different cognitive tests from different cognitive domains that don't depend on "knowledge" and run them through principal component analysis, the first factor that you get is g. The problem with a regular IQ test is that it takes an hour to complete and that hour doesn't provide additional benefits. If I spend an hour a day with Anki, I do don't do it to determine my cognitive performance but I do it to learn. That means there a possibility of getting a good cognitive score for free. Another problem with regular IQ tests is that you can train to get better at a particular IQ test. You score better at the task but the test focuses on specific skills that don't generalize to other skills. Having the large pill of SRS data should allow us to correct for the training effect if we want to do so. We might also find that we don't even want to correct for the effect and the effect generalizes to other domains. SRS has the advantages that we do always get new ca
IQ - I could hire excellent tutors to make myself more intelligent, though definitely only to a certain point. More to the point, I could hire smart people to think of good ideas for me. I'll concede that I couldn't buy the experience of thinking like someone smarter than myself. emotional states - Hire some psychologists to figure out what experiences causes people to have them, then buy those experiences. personal achievements - This one I'll give you; you can't buy achieving something for yourself. honour - This is a very vague term to me.
As far as I know you can't raise your IQ significantly by training. There is a lot of data about how much can you raise your SAT/GRE/LSAT/etc. scores by tutors and training and that amount is limited, plus most of the gain is test-specific and not properly a rise in g. That doesn't buy you IQ, that buys you solutions to problems. That's a different thing. Let's see how that works for achieving moksha (= becoming enlightened) :-D
This is a temporary effect and not guaranteed even then, but psychedelic drugs are definitely a thing you can buy.
I could pay lawyers to threaten with lawsuits people who criticize me. (Only the influential ones.) I could bribe some bloggers and journalists to write nice things about me. They would be free to refuse the deal anytime, but my lawyers would threaten them against ever disclosing our deals explicitly. I could pay an assistent to make a list of all things I ever promised, and to remind me of them. Also, whenever possible, to discretely remind me to not promise anything. Another assistant to evaluate everything I say or do, to point out things that might seem dishonorable.
Both these actions would significantly reduce your honor, though they might improve your PR image.
It is very much like a joke that tar is a great baldness cure - if poured on heads of those people who call you bald. Honor and public image are not the same.
Hiring assistants to do IQ-related tasks doesn't raise your IQ for the same reason that purchasing a notepad to jot down things you can't remember doesn't raise your IQ.
Purchasing a notepad does raise your ability-to-do-memory-bottlenecked-things, though, which might be just as good for your purposes.

Not very related, but something bizarre I realized my brain assumed existed but on reflection seems rather bizarre to have arisen unprompted might not at all so I'm wondering if it does: A class of people who'd find it well worth the money-time transaction on paper, but have some combination of non-enormous houses and sensitive stuff in it that'd mean instructing someone to be able to clean without causing more damage than they fix and puting everything in places where you wont find it etc. would take longer than just doing it yourself.

Trying to channel Marcuse from memory, here goes: We have a finite need for money. We need it for is adequate food and shelter. But unsatisfied emotional needs can be effectively unbounded. It's possible for the culture to convert the things that money can buy into something that we seek because of unsatisfied emotional needs. From hence flows the unbounded need for money.

Marcuse would substitute "capitalist" for "culture". But perhaps it's just something about human nature. Perhaps it's the dopamine system in our brains. Not sure why it works this way (assuming it does indeed work this way).

The way it's phrased, it suggests that "money should be only for food and shelter, really". It may not be what you're trying to express, but I read it as having that kind of subtext. That, I believe, is an untenable position. The fact that musical instruments, which are necessary for meeting certain emotional needs, cost money has nothing at all to do with culture converting anything.
Good point, I was trying to briefly summarize Marcuse's view but I did not do a good job. Marcuse view was that we think of ours as a materialist culture, but we are beyond the need for material goods in the sense that our productive capacity far exceeds our needs (but of course, we distribute unevenly so that there are still some in material need.). Demand is driven by emotional needs rather than material needs. And the stuff we buy often does not satisfy the emotional need, hence demand becomes unbounded. But a musical instrument is perhaps something that can lead to emotional fulfillment. (Marcuse was a sort of neo-Marxist and was pushing the idea that the capitalist system exploited this to create unbounded demand. I don't mean to push that view, I just think some of the premises of his argument have merit and is relevant to the topic. After all, some of the pre-capitalist rich seemed have an unbounded desire for riches.)

You make a few different points, and I've tried operationalizing two of them.

Time is expensive:

  • when considering a job, estimate how much time you'll be able to take off from it and when you'll be able to retire, and what you'll do with that time

  • do this estimation for a lot of jobs, even those that don't seem appealing, to find the opportunity cost of the ones that do seem appealing

I don't mean I've actually done these, not yet anyway. I just read the article.

Another point was, comparative advantage:

  • Observe time usage and look up costs to hire peop

... (read more)

For the pedants, to say something is an exception that proves the rule is to say that when you look at the exceptions, they're so unusual that it reinforces the point that the rule is generally valid even though it isn't universally valid.

That is not what "exception that proves the rule" means. If you're going to invoke the name of pedants, after all, you should be properly pedantic, no? ;)

I agree a lot with this article but I think it's not a reply to all definitions of the argument; 'there are some things money can't buy'. I'll start by saying what I agree with. Money does buy things. Having more money makes things easier/possible. Time is money and opportunities not taken are lost money. From that angle I fully agree.

But even still, money can't buy everything. I read just moments ago a good quote which said something to the effect of; someone might say they have an apparent end goal of making lots of money but if asked what they would do... (read more)

Well, assuming you already have some necessary rationality to do this, you can use money to fine-tune your health (maximize your intelligence within your genetic limits) and buy all education and training you need, such as CFAR workshops (maximize your rationality and skills). Then you give yourself a multiplier by buying all the tools and assistants you need. If you started decently intelligent and rational, you might end up extremely awesome. (Maybe even so awesome that the increased income will be greater than all those initial expenses.)
Yes but like you said, "you [need to] already have some necessary rationality to do this"- that's the kind of thing i'm talking about. You can't buy that original rationality and you can't buy the fact that rationality exists. The stuff you said is true but I think you are trying to answer to different topic than which it is relevant to. Money can buy things and make you happy- but money can't buy the fact that happy exists. When I talk about "money can't buy everything", it's in that way that i'm talking about (not to be confused as saying 'owning things doesn't make you happy').

I think this post is wrong and dangerous, but I like it a lot and I think you're bold to post it. Hopefully it will help more than it harms.

Thanks. I think. It would be more helpful if you said why you think it's wrong and dangerous, though.
I suspect that the common error is not the one you identify, but rather its reverse; it strikes me that there are significantly more people who care too much about money than there are people who care too little about it. While posts like this are very useful for those who care too little about money (because, let's be real-- money is pretty useful!), I consider them somewhat dangerous for those who care too much about it. In other words, I like this and think it's great for the intended audience, but I think it may be harmful to an unintended audience who will nevertheless read it anyway.
Huh. Interesting. Wish I'd thought of that. Having had it pointed out, though, I wonder if this is largely a salience thing. Stereotypical Rich Assholes (TM) get a lot of news coverage, while the dubious career-planning decisions of the mass ranks of recent college grads get very little attention. However, I personally know an awful lot of those recent college grads who made dubious career-planning decisions. And I think it's even less plausible that the people on the bottom half of the income distribution care too much about money. To a large extent not worrying much about money is a luxury of the rich. Poor people may often have unrealistic ideas about the best way to become better off financially (winning the lottery, making it in sports / entertainment) but I doubt caring too much is their problem.
I share your guess that more college-age people care too little about money than too much. On the other hand, I seem to recall seeing figures suggesting that a startlingly large fraction of good students from the US's elite universities go into finance, which is (assuming for the moment that Izeinwinter's prophesy of doom turns out to be incorrect) an excellent choice from a money-optimizing perspective and probably a pretty poor choice for most in other ways. That might indicate that all those people have carefully considered their values and their career prospects, and have made a rational decision to prioritize earnings early in their career -- or it might indicate that they've just jumped for the highest-paying option they can see without considering other issues. I'd guess the latter is nearer the truth. If what I seem to recall is actually correct, and if my guess contingent on that is also correct, then there's a sizeable population of intelligent people caring too much about money rather than too little. I'm pretty sure the population in question is statistically pretty wealthy to start with, and as you say caring less about money is easier for the rich (and also probably more rational for them, unless they're very altruistic[1]), which makes it more likely they're caring too much about money. [1] My meaning may not be perfectly clear here, so I'll explain. How much you should care about money depends on how much you can influence how much money you have and on how much difference that makes to your utility function. If you are already well off, the former is bigger (more opportunities) and the latter is much smaller if you're selfish (diminishing returns) but not if you're altruistic (there are enough starving Africans, un-malaria-netted beds, etc., to absorb all the money you can throw at them). So selfish people should probably care less about money if they're rich, and altruistic people should probably care more about money if they're rich. Of course