Managing Future Income Risks

The prompt focuses on how we make decisions and how much they are based on considering the future possibilities or whether they are made because it seemed like a good choice at the time. I think the purpose of this prompt is to look back on decisions we have made and try to understand what caused us to make those decisions and whether we considered the uncertainty and risks involved in making such a decision. Many of the decisions I have made in the past have been based on the future and reducing income risks, whilst other decisions have been made simply because they seemed like a good decision at the time (sometimes regardless of the potential income risks).

While I do not have much of an idea of what job I will get, where I will work and what my salary will be, I have considered these when making decisions for my future. For example, when choosing my major when I was applying to colleges, I started looking at what skills are most sought after now as well as what skills are expected to be in high demand in the future (10 to 20 years from now). While I was already interested in Computer Science, this gave me a better incentive and more reason to opt for a major in Computer Science. I opted for Computer Science and Mathematics because I was always interested in Mathematics and I found out through research, that students who study Mathematics along with Computer Science are also highly sought after. Regardless of the demand in this field, I was taking a huge risk since I was going to be paying tremendous fees despite not knowing whether Computer Science was a field I really wanted to go in since I did not have much experience in the field.

After my sophomore year, however, I realized that I was no longer interested in Mathematics and decided to switch to Computer Science and Economics since I had already taken 3 Economics courses by that point and enjoyed them thoroughly. In this case, I felt there was a smaller risk than initially applying for a Computer Science and Math major. This was because I took a more informed decision this time since I was confident that Computer Science and Economics were both fields that I was interested in pursuing which is also increases my marketability for a job in the future since there is increasing demand and low supply of people with skills in both fields.

One of my friends who graduated last year applied for a major in Computer Science, but he chose that major because he felt that it was a growing field, despite not having much experience in it and not enjoying the experiences he had with coding. He struggled with keeping up with CS courses and ultimately decided to switch to a Civil Engineering major after his sophomore year, which was something he was always interested in, but had decided not to study it since he considered it to have fewer job opportunities after graduation. However, after switching majors he was doing much better academically and enjoyed his courses much more. After graduating, he got a job offer from one of the biggest automation companies in the world and is now working there. While he took a big income risk by changing his major, it worked out well for him in the end since he enjoys the work he does more than when he was studying CS. What I learned from him is that sometimes it is worth taking a risk to pursue what you really want to do, since he took a huge risk by doing so and it paid off for him.

Reflection Post

Before writing this post, my previous blog posts (and the prompts) seemed to address different topics and seemed to not have any connections whatsoever. The blog posts have so far addressed several topics: Transaction costs, Opportunism, Organization and structure of teams (and the features of high functioning teams), and transfer pricing (the idea of implementing a system of “Illinibucks”). Reflecting on my blog posts, most of them do not have many concrete connections with each other, but looking back, there are some instances or themes when I observed a connection. For example, when we looked at transaction costs and team structure, in my post about transaction costs, I spoke about working in a team during an internship where I felt there were transaction costs, which related to the discussion about team structure in which I talked about how group projects for classes work in different ways to teams in companies made up of employees. Also, the post about opportunism and Illinibucks were also similar in the way that opportunism was a concept that could be applied to the hypothetical system of “Illinibucks”, since opportunism would cause students to act in immoral ways, such as by misusing their allocation of Illinibucks. If Illinibucks were created, it would also create a black market for Illinibucks where students would buy and sell their Illinibucks for real money.

Initially, I did not completely understand how the prompts related directly to the course, sometimes because I did not understand the concept, although most of the time it was simply because I did not see any relation. For example, when I wrote the blog post about Opportunism, I did not quite understand how it related to economics at all, and specifically this course. However, after writing the blog post about Illinibucks and transfer pricing, I began to understand how opportunism relates to transfer pricing and how it explains human behaviour. By relating the concept of opportunism to scenarios I have observed in my life, I understood how the concept relates to several other concepts not only in this course but in economics in general. For other blog posts, the connection between the prompt and the course themes were very obvious, such as the blog post about team structure in which I was able to directly link my experiences to the themes of this course.

Thinking back on how I would write the blog posts, I noticed a few things that have changed. Firstly, I have become more confident about what I am writing about since the first blog post. At first I would be unsure whether the experience I was planning to write about was a good choice and whether I would be able to explain my thought process clearly to help the reader understand how my experience relates to the prompt and the course as a whole. Secondly, I started to provide more context in my post so that the reader can better visualize my experience and my point of view. In terms of the actual process, after the third blog post, I realized that I was having difficulties relating the prompt to the content of the course. Therefore, I since have started to read the prompt beforehand so that I have time to think about it rather than reading the prompt and then immediately start writing my response. Also, I started to write my response in different parts since I remembered that when it comes to writing long responses, this technique helps me since this way I have more time to come up with different idea to relate to my post. This is something I also do with coding assignments: I start early and work on it in small bits and pieces and sometimes I suddenly have a huge breakthrough which helps me to understand how to solve the problem.

I think there are a few things I would change about the prompt which I feel would provide more benefits to not only me, but to other students, the class and to the discussion as a whole. The key aspect of the prompt I would change is that I would try to make the prompt more clear when it comes to relating it to the course themes. As I explained, I struggled with this at the start of the semester and had the prompts been directly related to the course themes/contents, I would have better understood the concepts and fewer students, including myself, would misunderstand the prompt. Although this does not relate directly to how I would write the prompts, I think it would also help students if they could see sample blog posts about the same/similar concept since this would help avoid people misunderstanding the concept and creating an incorrect connection between the concept and their personal experiences.

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Illinibucks

There could be many uses of Illinibucks if a pre-specified quantity was granted to every student. If Illinibucks could only be used to move to the start of a line, some potential uses of it could be allowing students to register/waitlisted for courses early (for courses that are popular and have fewer seats than demand for the class), reserving study rooms, gyms or other facilities and moving up in the waiting list for advising appointments or office hours. Regardless of the different possible uses of Illinibucks, there would be many issues that implementing such a system would cause. There are ethical issues of such a system since some students may not even get the opportunity to register for some classes or may have to wait a long amount of time for advising appointments and office hours if they do not have Illinibucks left. Also, however, is the issue with pricing for the different services students can buy with Illinibucks, since if the administered prices are too low or too high, it could have adverse effects.

One way I would decide to spend my Illinibucks would be for registering for some classes early. While I would not have to do this for classes in my major since I would have priority registration regardless, I would have to use some Illinibucks when deciding what gen-eds to take. In the past I have not had issues with registering for a gen-ed course since I plan what courses to take well in advance of my time ticket for registration, but since other students will likely use Illinibucks to register for a course early, I would have to do the same to ensure I get a seat in the class. Another way I would use the Illinibucks would be for appointments and office hours, since the lines for both can get extremely long, particularly for office hours. Instead of having to wait in line for 1 hour (or possibly much more), I would be able to use Illinibucks to get help on my difficulties immediately.

However, there could be various problems with the administered prices. If prices are too low, then students would use their Illinibucks freely and this could cause serious problems. For example, when registering for courses, if registering early costs a very low proportion of the allocated Illinibucks, since it is at the start of the semester (when most students won’t have used any of their Illinibucks), there is a strong possibility that many popular courses will become full extremely quickly and the waitlist will also grow immensely, meaning that students who want to register for the course at their actual registration time ticket, will have nearly no chance of successfully registering for that course. Low prices would also mean that students may use their Illinibucks for reserving facilities and skipping lines for appointments/office hours with excessive frequencies. This will create long lines of students who used Illinibucks to skip the line or be put on the waitlist, which does not actually give any student an advantage since everyone is using their Illinibucks.

If administered prices are too high, it would mean that students may end up using their entire budget at once and therefore won’t get much of an advantage out of it. Although this does mean that students would be more wary of where they spend their Illinibucks, it also means that if they have already used up their Illinibucks, they will have to wait in a long queue every other time, even if they urgently need to skip a line for what may be a valid reason. Therefore, the pricing of services offered for Illinibucks would be a key issue.

However, another major issue would be the ethical problems with Illinibucks. While some students would see it as unfair, such a system would most likely also result in a huge market for Illinibucks where students will try and buy and sell their Illinibucks for real money. Since Illinibucks would not be transferable, the buyer will get the seller to use their Illinibucks for them. This would clearly benefit wealthier students and while students who are selling Illinibucks may prefer the system since they can make real money of it, this clearly poses an ethical problem. While some students would prefer the implementation of such a system, other students may not and the advantage all students gain will never be equal. Therefore, while considering the benefits of Illinibucks, due to the various problems it would cause, I think it makes more sense to not implement such a system.