This is more psychology than economics, but as I sat a breakfast this morning, a train of thoughts and reflections led me to the question: What makes us value people?

My immediate thought was that we value people based on their quality of friendship. Perhaps the length of friendship could be a signal of this (think of the saying – make new friends, keep the old; the first is silver, the other is gold). I don’t think length of friendship is, in itself, inherently a positive determinant of the quality of friendship. Perhaps it is instead the experiences you share, the times you’ve had that make you understand a person increasingly well.

But spending time together does not necessarily mean that one can always understand the other, nor does this all mean that a “stranger” cannot have greater insight on you within a very short amount of time [or does it?]. People are often attracted to the immediate – the one who seems to understand them in one conversation – and might perhaps value the person who can (seemingly) understand them in an instant. [How much can one understand another so quickly?]

Then I started to think that value is really just a function of the one person himself, and not so much the object/person in question. Is value inherent in anything? Probably not. Money, perhaps, is one thing we all value – it can generally be exchanged for just about anything. But in terms of objects – I can’t expect you to value my, say, running shoes … nor do I value your television (which you may love). And this will certainly sound obvious, but I don’t know if it occurs to everyone – we can’t be expected to value the same traits in people. Surely, most people value consistency, reliability, willingness to devote time and energy – but beyond that, and even those traits alone – is it enough to determine how much we value another?

Back to the person, the valuer (rather than object/person of value …) – I think we’re prone to value different things, traits, and people at different times … (again, another obvious statement, sorry) – and whether or not he appreciates something may be a function of his current situation more than the actual person/thing of questioned value.

Does this mean, then, that we can’t increase our own value in another’s eyes?

One thought I had, as well, was on “playing hard-to-get”. Does that increase how much someone values another, if the object is ever “achieved”? Does the feeling of “winning” something fade quickly, or has the person learned with time and experience that this person has enough value (?) that she will not give herself away so quickly? Or is it just that relationships that start this way are bound to be more lengthy and successful because the pursuer’s chase – and “hard-to-get” person’s eventual giving in – is a signal that the pursuer is so dedicated to making it work, and the other has found him more valuable than other potential courters? … Is it worth “playing hard-to-get”, from this perspective?

How else might we affect how we’re valued? Can we? Should we? Is this something that comes necessarily as time proceeds? (I’d argue otherwise, obviously).

Perhaps, like many other things, magnitude of “value” is somewhat irrational …

economic analysis 101: college dating scenario

My friend recently sent me an inquiry:

Stephanie, what are your thoughts on this? One guy in love with five girls, is very dedicated to all of them… wooing them all, but completely honest that he is very confused and not ready for a relationship.

My response:

From an economist’s perspective:

1) The guy’s optimal solution is to do what makes him happiest, which appears to be wooing them all. If he eventually makes up his mind, then he dates that girl; if he continues to be “confused” (eg values them roughly equally), then he continues seeing them all until they all drop to one. Honesty remains the best policy with all of them, in my opinion.

2) The girls’ optimal solution: judge how much they like him, how attached they are, and how willing they are to wait. If they can attach and detach easily, they should hang around and hope for the best, and detach when necessary (or they get impatient/get bad vibes). If they get attached (as most girls do), they should try to let go now as much as they can and move on from here. Or … you know, take the pain, and hope it allows them to get over him later.

3) The societal optimal solution: He should flip and coin, pick a girl, and pursue her. That one girl is happy (especially if he doesn’t reveal his method). He is happy (to a certain extent … he now has one girl and no decision to make). The other girls get a clear signal that it’s time to get out.

Just the academic perspective. Of course I have a slightly different personal perspective.

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In a later message, I elaborate:

So rationally, I recognize that the “best”/moral thing to do is for him to be single and the girls to move on their merry way. … but life isn’t so easy. It’s hard for him to make that choice and for the girls to get over a single guy.

From experience, I know it hurts a lot. [...]
Emotionally, I know what it is like to hope, to *want* the attention and enjoy him and want to be “the one”. And I know what it’s like to make “the decision” to get over him and then find that you’re still head over heels.

So … the girls should get out if they can. With the understanding that the girls might be “too deep” to get themselves out, they should just try to be wary. Honesty’s always the best policy in these cases (as much as it hurts in the moment, lies would hurt more in the long run). If the girl enjoys the date enough that the joy overshadows the potential confusion/upset-state afterward, then she should still go on the dates, acknowledging that she may not be the only one. When the pain is too much to bear, then maybe she has incentive, finally, and enough strength/motivation to get out.

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It all sounds pretty economical to me; even my personal perspective has the underlying concept of “producing” until marginal revenue equals marginal cost. … Economics does make sense in real-life.