The world's funniest economics stories

Chapter 29 Why Female Models Earn More Than Male Models (2)
It's better for everyone to take turns on duty, but the person who distributes the porridge should be the last to receive the porridge.Everyone originally thought that this proposal would end soon like the previous few times.But what is amazing is that under this new system, the porridge in the 7 bowls is the same as if measured with a scientific instrument every time.It turned out that under this brand-new mechanism, everyone in charge of distributing the porridge realized that if the porridge in the 7 bowls was different, he would definitely only get the one with the least amount.

Regarding the story of seven people sharing porridge, if porridge is regarded as a resource, then how to maximize the advantages of porridge as a limited resource and how to distribute porridge more evenly involves the concepts of efficiency and fairness .Let us first understand what efficiency and fairness are.

Efficiency is the ratio of people's output to input in practical activities, or the ratio of benefit to cost.The larger the ratio, the higher the efficiency, that is, the efficiency is directly proportional to the size of the output or benefit, and inversely proportional to the cost or input.In other words, if you want to improve efficiency, you must reduce cost input and increase efficiency or output.

Fairness means that the interests of people and the principles, systems, practices, and behaviors of the interest relationships are in line with the needs of social development.Fairness is a historical category, and there is no eternal fairness. In different societies, people have different concepts of fairness.

Some people say that the relationship between efficiency and fairness is essentially how to make the cake bigger and how to distribute the cake more evenly.When it comes to efficiency and fairness, we must seek the best fit between the two in order to achieve efficiency and promote fairness.Although it is not easy to perfectly combine efficiency and fairness, we can neither only emphasize efficiency but ignore fairness, nor ignore efficiency because of fairness.

Economists always think more rationally than other people.Regarding the unavoidable topics of efficiency and fairness in economics, economists generally believe that emphasizing either of them will inevitably cost one of them.Therefore, the efficiency and fairness that most people hope to achieve at the same time will actually appear in a dilemma.

There are two very good friends who like to do it by themselves and use oranges to make their favorite delicacies.One day, they put the oranges they bought together on the table. One of the children was responsible for cutting the oranges, while the other just chose the oranges.In the end, according to the previously agreed method, the two each took half of the oranges and ran back to their homes very happily.

Among them, a child likes to drink orange juice, so he peeled half of the orange he got, and put only the pulp into the juicer.And another child likes to eat orange-flavored cakes, so he chose to grind half an orange peel, which has a stronger orange flavor, into fine powder, mix it in flour and bake it into a cake.After the cake was baked, he dug out the remaining pulp from half an orange and threw it into the trash can...

The two children got half of the oranges that belonged to them, which seemed fair, and through processing, they both got the delicacies they wanted, but they didn't make the best use of what they got.It seems fair on the surface, but it does not maximize the interests of both parties, that is, the efficiency of resource utilization is not optimal.

This story not only helps us understand the relationship between efficiency and fairness, but also gives us some enlightenment-in real life, we can neither blindly focus on efficiency, but at the same time, we must break away from the "absolute" understanding of fairness. the shackles of fairness.

Since the reform and opening up, 30 years of reform practice, my country has been implementing the "efficiency first" strategy.However, in this process, the widening gap between the rich and the poor and the extreme imbalance in regional economic development have made everyone see the negative impact on efficiency caused by the continuous deterioration of inequality.If things go on like this, the sense of fairness will lead to an increase in "distributive conflicts" among various classes, which will directly affect economic growth.

However, fairness is always relative, and there is no absolute fairness in the world.Under the circumstances that it is difficult to achieve both fairness and efficiency, economists have made a rough division of labor, that is, insisting on the strategy of "the market emphasizes efficiency, and the government emphasizes fairness" and requires the government to establish a comprehensive social security system as soon as possible, while the market still focuses on efficiency Competition, which to a certain extent avoids the problems of efficiency and fairness.

Productivity is the term used to express the ratio of output to input [that is, the ratio of total output to labor input].Productivity increases if the same amount of input produces more output.Growth in labor productivity is responsible for technological progress, labor skill improvement, and capital deepening.

4. The protagonists and secondary players in the office - the [-]/[-] rule
I read an article and said: In every office, there are people who are full of ambitions and want to climb up, and there are also small employees who just want to be lazy but have no ambitions.As a result, there are only two roles in the office - the leading role and the secondary role. It is not fate that determines your future, but your ambition determines your destiny.

A, B, and C joined the sales department of the company together. All three are high-achieving students, but their backgrounds are completely different.

A came from a rural area. He went to university after hard work and the help of relatives and friends. He had top grades and was admitted as No.1 in the interview.

B is a landed household in this city. Although his family background is average, he has no worries about food and clothing. He came to the company directly after graduation.

C is the one with the best family background. His father is a small official in a certain government department. He only greeted the directors of the company and joined the company without taking the exam.

All three work in the company's sales department.Because of his bad background, A set a goal for himself, to make a good appearance within one year, at least to take the position of deputy director.C also has ambitions, aiming at the position of deputy director of the sales department.Only B's ambition is not great. He loves leisure and hates work. Based on the principle that one thing more is worse than one thing less, he will never take the initiative to work when he can be idle.

When the company sends out business orders, A and C are always scrambling to grab each other.B sits in the middle, does not say a word, does not fight or grab, the leader will do it, and the leader will not do it.A few months have passed, and the sales director and even the sales manager know that A and C are the hardest-working people in the department, and B is the most idle.

Finally one day, the supervisor dropped a "dead order".This is a commonly used name in the company's sales department, which means that this list will definitely not be negotiated, and if it is not done, it will be a troublesome customer who will complain.

During the regular meeting, the supervisor took out the "dead order" and asked who would accept it.At this time, almost everyone turned their attention to A and C.The supervisor also turned his head to ask for their opinions.But when A and C both said that they were busy with a lot of orders, the supervisor suddenly thought of B while expressing his understanding.The supervisor's eyes fell on B: "You can do it."

"Me?" B was tongue-tied.Not surprisingly, B failed to negotiate the list, and was complained by the customer and criticized by the manager.In the next few months, B received either a "clear water list" or a similar "dead list", which was miserable.

B always thinks that A and C are too stupid to compete for work every day, but during the regular meeting, everyone waits for them to continue to fight for orders, but they look busy.A and C are definitely the smartest people in this department. Because they have ambitions and ambitions, they work hard and want to make achievements as soon as possible.And work is precisely the best cover in the workplace. The more people work, the more qualified they are to choose jobs. They can make a busy face when they encounter "dead orders" and "clear water orders". look.If you're a boss, you certainly don't hand over your troubles to your most capable and productive employees.

Why is this?

The 19th law, also known as Pareto's law, was invented by the Italian economist Pareto in the late 20th and early 20th centuries.He believes that in any group of things, the most important only accounts for a small part of it, about 80%, and the remaining [-]%, although it is the majority, is secondary, so it is also called the [-]th rule.

It was discovered by Italian economist Pareto in 1897.He found that in the real society, 20% of the people own 80% of the social wealth, that is, the distribution of wealth among the population is unbalanced.At the same time, people also find that there are many imbalances in life.So the 80/20 rule became shorthand for this unequal relationship, whether or not the outcome was exactly 80% and 20% [statistically speaking, exact [-]% and [-]% are unlikely].Accordingly, Pareto put forward the principle of "important few and trivial majority", requiring people to arrange the order of things according to the importance of things.

The 80th rule has been extended to all parts of social life and is deeply recognized by people.In economics, 20% of sales come from [-]% of customers.Applying the [-]/[-] rule to analyze the previous story, we can see that:
Every boss actually understands the 80/20 rule, and knows that [-]% of the benefits come from [-]% of the people, so A and C will always get the best business orders, which is the reward for their ambitions.And B, who is determined to be an ordinary employee, only takes on the work assigned by the supervisor.A person who always accepts assigned tasks is not qualified to refuse.So the fate of B is obvious, he is the stepping stone of A and C.In the past few months, the supervisor has been giving him dead orders, that is, to punish him and put him in small shoes.

Among these three people, A is from the countryside, so it stands to reason that he is the little guy.But the workplace doesn't look at your place of birth, or even your education background.What really matters is whether you want to be a secondary player or a protagonist.

The long tail theory is a kind of new theory which the network age emerges, proposed by American Chris Anderson.The long-tail theory believes that due to cost and efficiency factors, when the venues and channels for commodity storage, circulation and display are wide enough, the cost of commodity production will drop sharply so that individuals can produce, and the cost of commodity sales will drop sharply, almost any previous view It seems that for products with extremely low demand, as long as they are sold, people will buy them.The common market share occupied by these products with low demand and sales volume can be compared with or even larger than that of mainstream products.

5. Non-excellent employees are also valued by the boss - the barrel theory
Achilles is a hero who is regarded as the god of war in ancient Greek mythology.Legend has it that after his birth, his mother Tethys, the daughter of the god of the sea, wiped his body with alcohol during the day, calcined his body in the fire at night, and held him by his heels to soak him in the Styx River in the underworld. , making him invulnerable.

However, because his heel was held by his mother when he was soaked in the river water, only his heel was not soaked by the river water.This can be said to be the only fatal weakness left in his whole body.Achilles, who later grew into a man, made many exploits in the Trojan War and was invincible.But Paris, prince of Troy, knew the weakness in Achilles' heel.So, he shot a dark arrow at Achilles' heel from a distance.

Paris, known as the sharpshooter, just hit Achilles' heel with his arrow.In an instant, a great hero fell to the ground and died.

It is a pity to say that Achilles' death stemmed from his only weakness - the heel that had not been soaked by the river.

The purpose of citing ancient Greek myths and legends here is to better explain the very famous concept of "barrel theory" in economics.

(End of this chapter)