Susan Athey Blog

I am a student in Professor Arvan's Econ 490 class, writing under an alias to protect my privacy, using the name of a professional economist as part of the alias.

Friday, December 2, 2016

Class Governance Analysis

Both governances mentioned in the prompt, attendance and use of electronics, I believe are two of which all professors must make decisions on. Throughout my past seven semesters at the University of Illinois, I have experienced classes that varied greatly in class size, attendance policies and electronic usage. I’ve had classes where attendance wasn’t mandatory and worth nothing more than gaining knowledge, where attendance wasn’t required but you received extra credit through iClicker usage and where attendance was absolutely mandatory and regulated by turning in a note card at the end of every class session. Similarly, professors across campus have very different beliefs about technology usage. In some cases, professors allow technology because it is a way to take notes, others allow technology but urge students not to since studies have shown it’s a distraction to students and others, I’ve found typically older professors, have banned technology use all together, forcing students to take notes by hand if they wish to take notes at all. I think there are clearly benefits to each rule put in place and I can see the rationale behind the choices each professor makes.

Towards our class more specifically, the first governance that I will talk about is the choice to not make attendance required. I’ll be candid that when I registered for this class, I had heard through the grapevine that attendance wasn’t required. Being a senior, I was pretty excited to hear this and it was one of the reasons that I ultimately ended up registering for the class. Despite this factor, I was one of the students that attended class regularly, though not perfectly, despite the fact that it wasn’t required and nearly half the class never showed up. Just this past week, there were only seven students in class on Thursday for whatever reason. Although the fact that attendance wasn’t mandatory this semester and the lack of people who showed up might seem discouraging to come to class at all, it actually had the opposite impact on me.

I felt that because I had made the commitment in the beginning of the semester, I created this “reputation” that we talked about in class as a student who showed up to class. I personally knew I realized when certain faces in class were missing of those who regularly showed up, and I’m sure if I was observant of these things, a professor would be to. Ultimately, by not making class attendance mandatory, it inevitably lead to some students never showing up to a class session after the first day, or to show up once every few weeks. I believe that, while all the homework and quizzes were online, that those people didn’t get nearly as much out of the class as those who were present did.

Next, the governance of technology usage in class I think is also an important factor to talk about. Personally, I was in favor of being able to use portable electronic devices, such as my laptop, during class. This is a privilege, yes, but it is one that I have become accustomed to during my time at the University of Illinois. Although I described cases where I’ve encountered professors who banned electronic use, those cases were by far the majority in my experience. By allowing electronic usage, I was one of the students that always had my laptop open. I personal prefer to take notes on my laptop, I find myself to be much faster at typing than I am at writing. Almost inevitably, though, I would find myself surfing the web and finding myself distracted and off task at times because of this privilege. I’m sure many students fell victim to this as well.

One thing that I will say, however, if that I think that by allowing the technology, even though I’m sure everyone knew that it would take away pieces of our attention, kept consistent with other governances of this course. What I mean by that is, overall, this class was portrayed to be one with much lax. As mentioned, class attendance wasn’t required. Additionally, most deadlines weren’t very strict. While blog posts were “due” on Friday evenings, a timeline I tried to stick to every week, they were accepted until Sunday evening and sometimes even later than that. All of this created a rather lax environment, and if students were not allowed to use their electronics during class if they wished to I think would’ve been inconsistent with the lax setting. I think that by allowing the students whom did show up to class this semester the choice to use their electronics was a good move because I think that by being strict with this rule would have the potential to decrease class size, although I’m not quite sure if that would be possible.

Sunday, November 27, 2016


One of the reputations that I believe that I have across all domains in my life is that I am someone that is always willing to help. With my family and friends, I am known as someone that they can always come to if they need help finishing a task, need advise or just want someone to listen. I always try to put others, especially my loved ones, before myself, and it is something that I take pride in. The domain that I would like to focus more closely on, though, is the reputation I had at the place that I interned this summer, which is that I’m a person always willing to help. I try to achieve this reputation at every place that I work.

As anyone who has read my past blog posts knows, I worked for a pharmaceutical product manufacturer and distributor this past summer in the Chicago suburbs and I will be returning there full-time upon my graduation. Before talking about my reputation within this internship that I believe secured myself a full-time offer, I would like to take a step back and briefly discuss why I was able to receive an interview and internship offer in the first place. I think that by already having past internship and work experience on my resume as a junior really helped in receiving an interview with Medline as well as other companies. I think that this showed my willingness to work and my initiative that I was later able to portray in my interview and throughout my internship.

On the first day of my internship, I spent most of my day in presentations about the company and internship experience with the other forty interns. One thing that was told to us during one of the presentations was that they had room for all of us to get full-time offers as long as we proved that we were deserving of the position. The sort of things that the recruiter said that the company typically looks for in a full-time hire is that they are motivated, work hard and take initiative, all things that I believed I had exemplified in my past jobs.

From there, I jumped right into my internship. I was placed in a division with people that I instantly connected with and felt comfortable around. Becoming this comfortable with my coworkers allowed me to ask a lot of questions to learn as much about the product and company as possible. I also became comfortable asking for work whenever I felt like I had time to, and it also lead my coworkers to ask me to do extra tasks for them if I had the opportunity. Knowing that at the end of the summer I would be eligible to receive an offer from the company and that in order to do so I would have to prove myself deserving in ten short weeks, I wanted to take full advantage of every opportunity given to me and make the most out of every day that I was there.

I seemingly instantly became known within my division as someone who was willing to help with tasks, even if they weren’t related to my projects that I was assigned to by my manager on my first day. I’m sure this is how many interns are perceived, it is one of the main reasons companies have interns in the first place. However, I think beyond that my division knew that I genuinely liked helping out when I could. I was able to learn various different aspects of the division beyond the marketing side that I was hired on for.

At times, I would say that I have strayed from this reputation of always taking on other tasks. I took a business ethics class the semester before my internship, and one of the topics that my professor went over is setting personal boundaries when it comes to work. He mentioned that for many people, myself included, it’s hard to say no to someone when they ask for your help, but it’s important for work not to completely take over your life. I think this pertains more to a full-time career when you are on salary, but I found it being applicable during my internship as well. As an intern, we were supposed to try our best to get our work done in a forty-hour time limit and we weren’t supposed to work overtime. With this restriction, I had to learn to prioritize my work and make sure that I wasn’t committing to too many projects that I wouldn’t be able to complete.

Sunday, November 13, 2016

Principal-Agent Problem

I think that, oftentimes, the reason a principal-agent problem occurs is when the agent believes there isn’t enough incentive for them to do a certain task. In class, we have talked in detail about how something such as a being paid on commission affects the teamwork aspect within a company or job, but thinking closely I think that this would also have a major impact on this concept of the principal-agent problem.

When an employee’s actions are partially or fully correlated with their pay, I think that it’s fair to say that the employee is more likely to work hard and shirk less because it directly affects them and their living. In a sales position, for example, those employees are typically go-getters who are relentless in their goal of making that sale. Clearly, they want to make that sale for the good of the company, but they are much more focused on the commission they will get from that sale.

While I think that this assumption holds true in many situations, I believe that the idea that the task isn’t worth the pay happens in commission-based jobs as well. One example I was able to think of is the relationship with a realtor and the seller that hired them. A realtor earns their income by selling homes and the more that the house sells for, the more they themselves will make since realtors make commission based on a percentage of the selling price of the home. Now, thinking about this, you would think that a realtor would, similar to the sales employee I previously mentioned, would be relentless in getting that highest asking price for the home of the person(s) that hired them.

Most of the time I would think this is true, but in this scenario the marginal benefit for the agent is far less than that of the principal. By that, I mean that the principal, or the person selling the home, would probably want their realtor to negotiate for every dollar they could because they would are the ones receiving the bulk of that selling price. While the selling price does have an impact on the realtor’s pay, they probably don’t care about renegotiating with a prospective buyer for a couple hundred, maybe even a couple thousand, dollars because the realtor might value their time more than the slight increase in commission they would receive. This situation has clear moral hazard, because the principal hired the agent, in this case the realtor, to help them receive the highest sale price possible for them and the realtor can not exert as much effort as they should because they don’t find the commission worth their time.

I think that this same kind of moral hazard would occur even more so in companies that have employees that aren’t paid based off of commission. Many, possibly even more, people feel that they aren’t paid enough for the job that they do. Now, whether or not that is in fact true, a person would be less likely to do more work or do anything innovative for the company if they don’t think they are going to get properly incentivized. I heard this sort of thing from a couple people that I worked with this summer at my internship.

One thing that the company I interned for implemented I believe as a way to counteract the principal-agent problem is a bonus system, which I have talked about in a previous post. To reiterate, the bonus system was based off of specific tasks and numbers that would reflect your and your division’s work. In terms of teamwork, it created an environment that promoted a lot of collaboration since your bonus could be affected by the work of someone else’s. In terms of the principal-agent problem, I think that it also helps counteract this because it gives specific numbers and tasks for each employee to meet that benefit the company, but also benefit them since a bonus is based off of it. Now the question about this system is what if the employee could actually go further than the numbers but choose not to because they already met their “quota.” I’m sure this happens in some cases, which is a moral hazard and a principal-agent problem, but I think that if the goals are assessed properly between the principal and agent at the beginning of the bonus term that this shouldn’t be a major issue or conflict.

Friday, November 4, 2016

Team Conflict

I have had numerous part time jobs and internships ever since I was sixteen years old, and in most instances I would say that I got along with all of the people that I worked with. There was one project, however, when I was an intern at the State Farm Research and Development Center in Research Park that I found myself in a conflict with a peer.

I started working for State Farm during January of my sophomore as a Property and Casualty Actuarial Intern. This was obviously when I was still an actuarial science major. During the spring semester there, I worked on pricing projects with another intern who had some experience with the projects and we actually became very good friends through working together. After the spring school semester with State Farm, I stayed there for the summer full-time and was able to work on pricing projects as well as a research project. The team of interns that was put together for this project was across different divisions of the company, basically just meaning that we had different majors or areas of expertise. The interns on the team varied in ages as well. Most of us were rising sophomores and juniors, which wasn’t uncommon for the Research Center, but there was one rising senior who had been working there for over two years.

Overall, I would say that I got along with the five younger interns that I was on this project with, but all of us had conflict with this one older intern, who I will call Ben for the rest of this post. We all felt this conflict on the very first day of our project when he took charge of the project on the first day and assigned us all tasks but never assigned himself anything. I think that Ben acted this way because he was indeed older than us and had worked there much longer than us. Now, I understand that in group projects there is usually one person that takes charge, but the rest of us were looking at this as a collaborative project where we were all equals and would work together, not one where we would have separate tasks and would have to update Ben as if he was a manager. Throughout the summer, tension built between Ben and the rest of us interns in the group.

At first when myself and the other interns realized we were all feeling the same way about Ben, we initially acted somewhat childishly and would complain about him to each other and wouldn’t tell him when some of us were meeting up to discuss the project. I think we were hoping we could just ignore the situation and get on without Ben or at some point make Ben realize that we all believed his behavior and attitude were a problem and force him to change, much like Model I. In our situation, myself and the five fellow younger interns all assumed that Ben was the problem, decided to work privately without him and hope that we could make him change. This situation went on for about half of the summer, or six weeks.

It was this halfway point where myself and the other interns decided we ourselves needed to change. We noticed that there was a disconnect in our group since we weren’t communicating properly with Ben and it was becoming apparent to our corporate contacts that we would report to that something was going on. We didn’t want our feelings about one person to affect our project or our reputations, which I guess you could say was our "breaking point." This is when we decided to change our actions and include Ben in our work and just talk to him about how we had been feeling thus far in the summer. Reflecting upon this, doing so was much like Model II where we put our common goals ahead of everything else, openly communicated with everyone on our team and combined our expertise together to create a great project by the end of the summer. I won’t lie, Ben still wasn’t my favorite person to work with and we didn’t become friends, but we were able to learn to work together effectively.

Looking back, I do think that our team could’ve handled the situation differently, potentially could’ve been more proactive about our feelings towards Ben, to try and combat this conflict earlier; however, I think that the personalities of the interns and Ben just didn’t mesh well which was the root of the conflict; therefore I believe a conflict was inevitable at some point.

Friday, October 21, 2016

Team Production With Gift Exchange

In the New York Times article, a scenario created by two developmental psychologists Michael Tomasello and Katharina Hamann was explained. This scenario was meant to study and explain a child’s reaction this “share-the-spoils” idea based on certain situations and connecting that to the adults. The “share-the spoils” concept is, to my understanding, the description of when a person, more specifically a child in the study, is willing to share their success or rewards with another person/child. In the study, there were slight variations to each scenario to help try and identify when people are more willing to “share-the-spoils” and what the root of this willingness is.

When the three different situations played out, Tomasello and Hamann had interesting findings. They found that during their study, the children were less willing to share their earnings and create equality when they were either randomly given the better earnings, same idea as “finder’s keepers,” which wasn’t much of a surprise to me. Something more interesting, though, is that even when the two children performed the same exact task separately which resulted in unequal results, the “rich” child was still less willing to share.

The third scenario, which was actually the first one played out in the study and what the other situations were varied around, was when the children had to work together to get the earnings. When this scenario occurred, it was much more likely for the “rich” child to share their earnings with the other child because it was essential for them to work together to be able to get the earnings. I think that this scenario in particular relates the most to the idea of positive team production and gift exchange, while I do think that the other scenarios are definite possibilities during team production in cases such as group projects or in your career.

At the company that I will be working for next year, employees, excluding the sales representatives, are paid based on a salary and are eligible for a bonus at the end of the year based on certain criteria. This criteria is determined at the beginning of the year in a meeting with the president of your division or an executive of the company with very specific tasks and numbers that need to be met to ensure your full bonus. While I didn’t have direct experience with one of these meetings as an intern and have yet to have this meeting since I am still a student, a co-worker of mine was willing to explain the process to me during my last day of the internship when I had just received my offer to come back next year.

The criteria for this bonus wasn’t based off of how the company did as a whole, which would work in your favor if you did well but the company didn’t but wouldn’t work in favor of those who were hoping they could be lazy if the company was constantly growing without them. I feel like in many instances with companies, commissions or bonuses are based off of solely personal successes that would help the company and don’t focus much on the collaboration that is stressed so greatly at this university, as well as many others I’m sure. Something that I like about my company, however, is that a person’s individual bonus will be dependent on their respective team.

To be clearer, my company is a pharmaceutical product distributor and the company is broken up into product divisions which many employees view as their own mini company. In these terms, a percentage of one’s bonus will be dependent upon the success and growth of their product; something that I think promotes inclusion. Clearly there are tasks that are very specific to each person to make sure that they are doing their part, but there are also portions of the bonus that cannot be achieved alone, which makes your goals the goals of your co-workers at this company. Knowing this aspect of the company in retrospect started tying things together for me. I had always noticed that within my product division that everyone was very inclusive and willing to help on another, and while I think that one of the reasons was because they sincerely liked each other, knowing that their overall bonus was dependent on each other’s success made sense as well.

Other company’s have a different culture than this, the simplest one I can think of would be that of a car dealership. Your co-worker would be less willing to invest their time into help you with your work since you will be gaining commission off the sale and your co-worker won’t. I think that situations such as these could relate to the other scenarios of the study where the child was less willing to share their earnings because of the dumb luck they got it or simply because inequality was apparent.

Friday, October 14, 2016

Risk Behavior

In class, we talked about how younger people typically are more tolerant to risk than older people. I have an older sister who is twenty-seven years old and, while she has only been in the work force for six years, I think that her actions involving financial risks have echoed this theory rather consistently.

My sister was advertising major here at the University of Illinois. She graduated with high honors in her major, but I don’t think that anyone that goes into advertising expects to make tons of money, especially when they are just starting out. When my sister graduated college, she had an internship with a small healthcare advertising firm in a Chicago suburb. This was the first job that she had that was relevant to her major. After that summer of interning for the company, she was offered a full-time position and has been there ever since.

For the first two years after graduation, my sister lived at home with my parents so that she could save up money to live in the city. This technically would be a risk adverse thing to do, but I honestly think the only reason she stayed home is because she wouldn’t have been able to live otherwise with the money that she had saved up thus far. My sister thought that after two years of saving, she had enough money to move out so she moved into the city with one of her friends. When she lived there, she seemed to be living the dream life. From the outside looking in, I saw my older sister whom I had always looked up to living in this great neighborhood in the city in a nice apartment with her best friend and was constantly going out to eat and shopping. This was the life that I have aspired to have since I saw her achieve it.

It wasn’t until recently, however, when my sister moved out of the city and into an apartment in the suburbs with her fiancĂ© that I realized that life wasn’t as perfect for her as I had made it out to be. While she was living in the city and doing all the things I just described, she wasn’t saving any money during the two years that she lived there. My sister shared with me this summer that it took nearly her entire paycheck every month to live the lifestyle that she wanted in the city, and that while she misses living there, she is so happy that she is finally saving money, because she is in that place of her life where she is thinking about marriage and buying a home and having a family.

When my sister first told me that she went two years without saving anything, I was a bit taken aback because I couldn’t imagine living like that. The way my sister explained it, though, is that that was going to be the one time of her life to live in the city with her best friend and not have anyone else depending on her, so she wanted to have the full experience and do whatever she wanted. She was willing to do so even if that meant working overtime now and saving all of it so that she’ll have money for a wedding and a down payment on a house. Now, even though my sister has a much smaller cost of living, I hear her saying things such as, “I can’t afford that,” because she knows that she has some ground to make up. I think that this scenario of my sister almost perfectly exemplifies the theory that younger people are able to tolerate risk more than older people. I was able to see this transition in risk even within just a few years of her being in the job market.

Being able to witness and learn from my sister is something that I will always be grateful for. I have always looked up to my sister, and in ways also envied her successes which made me strive to do good things, better things, as well. I feel like I came into college knowing the system a lot more because I was able to witness my sister going through it. I picked a “hard” major, actuarial science, partially because of my love for math but also because of the salary I could achieve. I don’t think that I thought of salary at the time as a factor of risk and more so just an idea that was good at the time. What I will say, however, is that I think that I have gotten myself in internship opportunities early on in my college career, at least relative to my sister who got her first on after graduation, in hopes of saving money for later on. Even when I was a sophomore, I was actively looking for internships to build my resume and save some money so that I could reduce risk in the future when I hopefully move into the city with some friends. I was one of my only friends with an internship after sophomore year because I was one of the only ones that tried. I now already know where I’m going to work full time after graduation, and I would attribute that to seeing my sister go through this experience and learn that I’m going to have to be a bit more risk adverse now so that I have tolerate the risk I will endure when I more into the city in the coming years.

Friday, October 7, 2016


After skimming through my previous blog posts, I’m not sure if there are particular themes that I could point out that would tie all my posts together. One similarity between my posts, however, is that I have always used personal experiences to explain the prompts. I think that in a way the prompts have been set up in a way that encourages each student to talk about personal experiences and tie them back to course themes.

When I first saw the title of this course and learned about what this class was going to be teaching us, I was confused, but by being able to relate real life experiences to the prompts and class discussions it has made everything easier to learn.  I think the one prompt that I struggled the most with in terms of knowing exactly what the prompt was asking for and what experience in my life I could relate it to was the “opportunism” post. I will say, however, that after looking at your comments on my post, reading some posts of my peers and participating in the class discussion, I think I have been able to understand the prompt and theme much more.

Trying to think of connections to course themes aside from addressing the prompts that have clearly already been answered was a more difficult task, kind of how I felt when I was trying to think of an experience for the “opportunism” post that I just explained. I think that the themes that I personally was able to connect more obviously with my posts were the ones that I felt I had already had exposure to, which isn’t really a surprise. In the “opportunism” post, I had difficulty defining the term, which lead to me taking a long time to complete my post. In subsequent posts, including the team structure and “Illinibucks” ones, I was able to write the entire post fairly early and have the chance to go back to it and make edits, due to the fact I felt like I connected more with the theme in the posts.

I think overall, however, being able to write my post early, step away from it and come back is one of the ways I have evolved as a writer for this course. I have become a freer writer in that aspect. During the first couple of posts, I was pretty scared felt uncertain of the expectations and how I would be able to meet them, something I believe hindered my writing. Due to this, I felt like I became a much more tense writer, and would make an outline for what I wanted to write about the post. All this planning in the outline took time away from my actual writing, which meant I would write my post closer to the deadline which wouldn’t give me the opportunity to step away from the post and go back to it with a fresher perspective. Composing my posts with time to spare has also afforded me the chance to try and look at the post from a perspective other than my own in attempt to answer more questions.

In the future, I personally would like to see more posts like the “Illinibucks” one. I think that while at first it seemed like a very broad post, the terms were something that everyone was aware with. The fact that we were talking about the university, a commonality between all of us, allowed me to focus more on the prompt and class content instead of focusing on explaining the background of the personal experience I use in said prompt. By this, I mean that in the “Illinibucks” prompt I didn’t have to explain how things such as class registration works because it’s assumed we all know, while in a prompt like the organization or team structure one, I was very focused on explaining aspects of the organization or team as oppose to the course themes. Overall, I think that the comments about our posts have helped me personally evolve as a writer and made me more prepared for future prompts.