Opportunity Cost in Dating

Chris Dixon’s Climbing the Wrong Hill (2009):

I know a brilliant young kid who graduated from college a year ago and now works at a large investment bank.  He has decided he hates Wall Street and wants to work at a tech startup (good!).  He recently gave notice to his bosses, who responded by putting on a dog and pony show to convince him to stay.  If he stays at the bank, the bosses tell him, he’ll get a raise and greater responsibility.  Joining the technology industry, he’d be starting from scratch. He is now thinking that he’ll stay, despite his convincing declaration that he has no long term ambitions in finance.

Over the years, I’ve run into many prospective employees in similar situations. When I ask them a very obvious question: “What do you want to be doing in 10 years?”   The answer is invariably “working at or founding a tech startup” – yet most of them decide to remain on their present path and not join a startup. Then, a few years later, they finally quit their job, but only after having spent years in an industry they didn’t enjoy, and that didn’t really advance them toward their long term ambitions.

How can smart, ambitious people stay working in an area where they have no long term ambitions?  I think a good analogy for the mistake they are making can be found in computer science.

A classic problem in computer science is hill climbing.  Imagine you are dropped at a random spot on a hilly terrain, where you can only see a few feet in each direction (assume it’s foggy or something).  The goal is to get to the highest hill.

Local_maximum

Consider the simplest algorithm.  At any given moment, take a step in the direction that takes you higher.  The risk with this method is if you happen to start near the lower hill, you’ll end up at the top of that lower hill, not the top of the tallest hill.

A more sophisticated version of this algorithm adds some randomness into your walk.  You start out with lots of randomness and reduce the amount of randomness over time.  This gives you a better chance of meandering near the bigger hill before you start your focused, non-random climb.

Another and generally better algorithm has you repeatedly drop yourself in random parts of the terrain, do simple hill climbing, and then after many such attempts step back and decide which of the hills were highest.

Going back to the job candidate, he has the benefit of having a less foggy view of his terrain.   He knows (or at least believes) he wants to end up at the top of a different hill than he is presently climbing.  He can see that higher hill from where he stands.

But the lure of the current hill is strong.  There is a natural human tendency to make the next step an upward one.  He ends up falling for a common trap highlighted by behavioral economists:  people tend to systematically overvalue near term over long term rewards.  This effect seems to be even stronger in more ambitious people.  Their ambition seems to make it hard for them to forgo the nearby upward step.

People early in their career should learn from computer science:  meander some in your walk (especially early on), randomly drop yourself into new parts of the terrain, and when you find the highest hill, don’t waste any more time on the current hill no matter how much better the next step up might appear.

This story is a classic example of people overvaluing short-term inertia over short-term disruption, even if that disruption leads to long-term opportunity. Unsurprisingly, it also has application in the SMP.

Some people try to date someone they think they want, then move onto the other side of the same hill by dating the opposite personality to get what they didn’t get from the first person; other people try to get the same basic person again, just with this or that flaw fixed up or mitigated. Still others flop all over the place, trying different hills with little discernment to drive them. And others play for “security” – imagining what it must be like to live this or that lifestyle, but never detaching from their convenience-first partner or lack of partner to find out. (Interestingly, the financial term “beta” as volatility has the opposite meaning in red-pill nomenclature, where it refers to stability and comfort.)

Often it is not law or structure but ourselves that keeps us unfree.

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8 Comments

Filed under living a good life, primary sources, science+technology

8 responses to “Opportunity Cost in Dating

  1. Anonymous

    But the lure of the current hill is strong. There is a natural human tendency to make the next step an upward one. He ends up falling for a common trap highlighted by behavioral economists: people tend to systematically overvalue near term over long term rewards. This effect seems to be even stronger in more ambitious people. Their ambition seems to make it hard for them to forgo the nearby upward step.

    In the job market, there is logic to taking the next upward step ..

    It may well be that the position or industry that you think is your ultimate goal is going to disappear or move overseas by the time you have your prepatory experience.

    Also the availability of a high-paying or challenging job in a particular area is usually a signal of future growth in that era. There are exceptions (eg. Cobol programming before Y2K) so research and common sense are required.

  2. Opportunity cost is a very profound concept in life and economics.

    All the unseen costs – what might have been. A failure to account for opportunity costs also helps politicians to screw the public:

  3. I’m always surprised how little people consider opportunity costs when making decisions. In particular, women in their 20s should have a strong set of filters – the cost of halfwaying it is extremely high, yet that’s the route many women blindly take. It’s not just a question of wasting a few months here or there – it’s the question of who you might be seeing instead, the fork in the road you never take.

  4. Dan in Philly

    Though your perspective is true, it is limited. The real thing which limits ourselves is not our tendancy to take the safe small steps rather than strive for the highest mountain, but rather the thing which limits ourselves is we are striving for the wrong things. The person who climbs a high hill will always see higher ones, and believing the object of life is to climb the highest hill possible, he is unsatisfied. This person does not realize that there will always be a higher hill, and as long as he assumes he deserves the higher hill, he will always be unhappy.

    Happiness lies more in your internal attidude than the external altitude (you see what I did there? Clever, huh?). Life has a way of blowing us off course, and the best laid plays of mice and men gang aft agley. One climbs the hill one finds oneself on (or, one grows where one is planted). True happiness lies in recognizing the height of the hill means nothing, it is the climb itself which gives meaning to the climber.

    This has application to game, of course. Much of game discusses how to maximize your chances of climbing the very highest hill, and not enough in what to do once you are on that hill. Game’s applications to living life are far and wide ranging and can touch every aspect if you let it, but the first step is to recognize what is worth striving for, and realize that limiting yourself to focusing only on choosing the proper mountain is too limiting.

  5. Brendan

    I think opportunity cost is typically not transparent to people most of the time unless the opportunity cost is glaringly high such that it cannot go unnoticed.

    In the SMP context, I think it can play out in a few ways, typically differently for men and women. Men who have high opportunity kind of reflexively appreciate the opportunity cost of settling down and committing. They probably wouldn’t describe it as being opportunity costly for them to do so, but that’s basically what’s motivating them. For attractive younger women, lots of opportunity can also skew the desire to pick and settle down and commit for some time, as well, because it creates the illusion that this level of opportunity will continue to perpetuate itself, meaning that opportunity cost of cutting off those opportunities is perceived to be high.

    People who have lower opportunity similarly have a lower opportunity cost than people with higher opportunity, and so the prospect of commitment and settling down is perceived to be less costly. As women age out of the dazzling sexual power years, the opportunity cost of settling decreases significantly as opportunity itself decreases. And, on the other hand, they begin to realize that there was also another opportunity cost curve which is now making itself more acutely present: that is, the opportunity that may have been foregone through choices made earlier in life. So on the one hand the opportunity cost of settling goes down as dating/mating opportunities go down in relative terms to where they were when she was 25, but at the same time the opportunity cost of not committing is beginning to skyrocket (if she, like most women, wants children) — this creates the panic mode we can sometimes see in the 30s range of unmarried women –> the two opportunity cost curves have flipped, such that the opportunity cost of not settling down has shot up, while the opportunity cost of settling has decreased significantly. Again, this isn’t often consciously perceived as opportunity cost, but the pressures certainly are perceived.

    Men are in a slightly different boat, of course, as their face somewhat different opportunity cost curves. It takes longer before the opportunity cost of settling down and committing, for a man with opportunities, becomes low enough so as to change behaviors. A man also faces a less steeply rising opportunity cost for not settling down and committing than women do – again, assuming he has opportunity. Men with fewer opportunities (which is most men) have a lower opportunity cost associated with commitment. This is probably why, once the opportunity cost for women committing decreases and the opportunity cost for not committing increases, there are generally plenty of men around who will commit (most of these women do find husbands) — because the guys have a relatively low opportunity cost of commitment.

    It’s the women who are very picky and want Mr. Alpha to commit who are whipsawed, because such a man still has a high commitment opportunity cost well into his 40s.

  6. My Name Is Jim

    This is a good illustration, but it simply falls emotionally flat for me. I’ve never felt much of a pull up the next step of a wrong hill, just because it was there for the taking today. Knowing I was answering the wrong question would have made the effort seem pointless.

    I could name some times when I didn’t try for something or someone I felt I wanted at the time. But then I also ask myself why did I want that and would I have been happier with it. And usually the answer is no, not really. The grass is not always greener. I’m happy with who and what I have. I didn’t detach from my partner for good reason, because we have a lot going for us as a couple, and I knew I didn’t want to lose that.

    Maybe someone else can share a different experience. I think it helps that I was and am a beta guy, I didn’t peak early and hard in attractiveness and options before I knew how to make major life decisions.

  7. detinennui32

    It’s not just the actual opportunities and costs, but what one BELIEVES those costs to be. That’s why game is so important – it reframes the issue to men’s advantage. That’s why fathers need to teach their sons to have nner confidence and presence. In that way, younger men will know and understand that opportunities (i.e. options) are higher and greater than they previously believed. They are greater than we think they are. Men have so many forces arrayed against them – society, media, culture, government – that we forget how valuable we are. And we need fathers to teach sons how valuable they are to women.

    And this is what probably leads many to:
    climbing the wrong hill, or
    climbing a hill simply because it’s there, or
    once you reach the top of one hill, you stay there, because you don’t know where the next hill is, what it’s like, whether you can climb it or even if there is another hill.

    What I should have known is: There’s always another hill, you can always find it, and if you can’t climb it, you’ll find another.

  8. “In particular, women in their 20s should have a strong set of filters – the cost of halfwaying it is extremely high, yet that’s the route many women blindly take.”

    I assume by “halfwaying it” you mean LTRs with no intention of marriage, or do you mean taking FWBs instead of taking the time to find a LTR?

    I think part of this is the programming that educated women shouldn’t “settle down” until they have a career under them, have seen the world, etc. The unfortunate fact is that for most women (and men), the opportunity cost of their 20′s is just endless nights at Happy Hour bitching about their job, with the occasional ski or beach trip. Honestly, people talk about their “freedom” and “keeping their options open” but outside of sex-pozzies and master PUAs how many people really take advantage of that freedom? Not enough people I know.

    That’s not to say you should hook to the first mate you can get and be done with it, but if one is rationally deferring marriage to a future a life goal then at least fill the time with something meaningful.

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