Moral Hazard
Wikipedia defines a moral hazard as:
Moral hazard is related to information asymmetry, a situation in which one party in a transaction has more information than another. The party that is insulated from risk generally has more information about its actions and intentions than the party paying for the negative consequences of the risk. More broadly, moral hazard occurs when the party with more information about its actions or intentions has a tendency or incentive to behave inappropriately from the perspective of the party with less information.
A special case of moral hazard is called a principal-agent problem, where one party, called an agent, acts on behalf of another party, called the principal. The agent usually has more information about his or her actions or intentions than the principal does, because the principal usually cannot perfectly monitor the agent. The agent may have an incentive to act inappropriately (from the viewpoint of the principal) if the interests of the agent and the principal are not aligned.
It's not normally my style to simply repost Wikipedia articles, but I came across this one while researching corporate raiding and was struck by it's relevance to several threads currently active in PPR, including one of mine on reasonable behavior. What intrigues me is to what degree do you hold someone responsible for succumbing to a moral hazard when it's in their personal interest to do so? Any takers?
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“The totally convinced and the totally stupid have too much in common for the resemblance to be accidental.”
-- Robert Anton Wilson
I have personal experience with the principle-agent conflict from when I worked in pizza delivery. My incentives were usually aligned with those of my employer, more business meant more money for both of us due to my tips. The problem came when a chronic non-tipping customer was identified, aka a stiff. My boss made money on the stiffs but I actually lost money when I had to deliver to a known stiff wasting my gas and losing out on paying orders. Therefore, it was in my interest to discourage the stiffs from ordering again, by lowering my level of service, or by more nefarious means. If my boss hadn't been a total douchebag, I might have been more willing to go against my interests, but he treated his employees as beneath him, so we were more than willing to pursue our own aims at his expense.
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“The totally convinced and the totally stupid have too much in common for the resemblance to be accidental.”
-- Robert Anton Wilson
Pizza delivery people have to pay for their own gas?! !
From now on, $5 is the minimum I tip, even if I have to borrow it from the neighbors!
(Sometimes, I just don't have cash on hand, and end up paying with a check.)
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It depends on the store, usually drivers receive a per-delivery fee that is supposed to cover gas and maintenance, I've gotten anything from $.50 to $1.50 per order from different employers at different times. The nasty thing is that pizza places started adding in this "delivery charge" a few years ago, that goes directly to the store and not the driver. They figured out that instead of raising the menu price, they could tack on a surcharge and people would deduct it from the driver's tip instead of ordering from a competitor. The really ugly part is that many places already pay their drivers below minimum wage as "tipped employees", then essentially steal their tips with the misleading "delivery" charge. Aside from the pure greed reasons for doing this, jealousy played a big role since the drivers traditionally have been the best paid employees in the shop, often making more than the management. They're always looking for ways to siphon driver's tip money into their own pockets, hence why I don't work in that industry anymore.
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“The totally convinced and the totally stupid have too much in common for the resemblance to be accidental.”
-- Robert Anton Wilson
This is exactly what they count on when they tack on fees like that, it allows the shop to make more money at the expense of the employees. To compound things, drivers are often forbidden upon pain of instant termination to even mention the word "tip" around customers, sort of like the no talking about moderator decisions rules here. Our only recourses are to either steal the money back from the shop through various methods, attempt to weed out the stiffing customers, or try to educate people on the sly. I used a combination of the three when I was working, depending upon the shop and the customer. I actually had a way of manipulating the order computer so that I could make customers pay more or less depending on whether or not I liked them, and kept notes in code on the system to who did and didn't tip. If you've been stiffing for a while, I'll spare you what often happens to the food of people who make a habit of it, you're better off not knowing...
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“The totally convinced and the totally stupid have too much in common for the resemblance to be accidental.”
-- Robert Anton Wilson
I never did it myself, but mailing coupons for freezer pizza to repeat stiffs is a cherished driver trick for anonymously making a point about their tipping habits. The more brazen drivers put the coupons in with their order, though that is far riskier if they complain.
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“The totally convinced and the totally stupid have too much in common for the resemblance to be accidental.”
-- Robert Anton Wilson
techstepgenr8tion
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Joined: 6 Feb 2005
Age: 44
Gender: Male
Posts: 24,195
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Yeah, it seems like people can only serve so many masters at once, usually it ends up being the one with the most immediate authority over their well-being. Other than that, if you really want to keep your ducks in a row, it means constantly staying in an environment that doesn't challenge you in such a way which can be very difficult and often times even impractical.
Don't tell me you go all fight club... that would just be plain nasty...
That being said, I usually tip whenever I actually have the money to do so...
That being said, I usually tip whenever I actually have the money to do so...
Actually, food tampering is pretty rare, aside from the moral issues you can face some nasty legal sanctions, and other drivers don't like the bad image it gives the profession. What does go on is that known stiffers orders are delayed or drivers fight not to take them, so those customers always get their food last. A more proactive technique is to secretly mark the computer files of bad customers, so that the counter people (often drivers) know to quote them outrageous delivery times, thus encouraging them to pick up. The worst that's likely to happen if you don't tip is that you'll get cold food, either from the long wait, or because an angry driver "accidentally" left your food under his AC vent on the drive over. I'd of course heavily encourage though, you never know when you might be dealing with a true rogue driver...
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“The totally convinced and the totally stupid have too much in common for the resemblance to be accidental.”
-- Robert Anton Wilson