Hate The Game
How to navigate life's trickiest questions
I almost got fired from my first job. I was a junior analyst at the New York Fed, on the very lowest rung on an exceptionally hierarchical ladder. My department’s role was to monitor foreign exchange markets. This was pre-Bloomberg terminal, so our team’s network of relationships with New York currency dealers was part of the Fed’s eyes on the market.
The full team met each week to decide on the content of the report we sent to Washington. The meeting began with the Executive Vice President giving his opinion on what we should write. Then, without fail, his view was repeated almost verbatim by everyone down the long managerial chain. Eventually it reached my boss, who would then turn to me, as if I hadn’t been listening to everyone repeat the same thing, and say “Kevin, this is what I think you should write”.
I guess I didn’t disguise my feelings about the absurdity of this process because after a few months my manager’s assistant told me point blank - you’ve got a terrible attitude, you better change quick or you’ll be gone.
The assistant explained that our mutual boss was well aware of the meeting’s absurd protocol. But that was just how government hierarchy worked. She was an experienced economist, a good person and deserved my respect.
This conversation shifted my perspective. I stopped focusing on my frustration and thought instead about what my boss needed - staff who listened, respected seniority and produced quality work. It took time, but once she could count on me to always do those things, our relationship changed and I began to get more of what I valued - like freedom to research new markets. When I later applied for a promotion, she wrote a recommendation.
This almost-sacking could have been avoided had I possessed a copy of Daryl Fairweather’s book, Hate The Game: Economic Cheat Codes for Life, Love & Work,
Fairweather studied game theory at the University of Chicago, where she became the first Black woman in its 120-year history to earn a PhD in Economics. She had intended to study engineering but changed her mind after reading Freakonomics, the groundbreaking book that showed how economic reasoning could explain more than just inflation or the stock market. Here was a book showing that an understanding of decision making under uncertainty could address questions that she felt were far more intriguing. Questions like - why had crime rates suddenly began falling almost everywhere in 1990s? And why, for some parents, was choosing their child’s name one their most influential decisions?
Hate The Game harnesses the spirit of Freakonomics, but it’s more practical. Each chapter draws on the intuition of game theory and behavioral economics to help navigate the big questions of life - when to switch jobs, how to get a promotion and strategies for home buying and selling. The examples - from popular culture and her own career - are fun and clear.
Try On New Shoes
My almost-sacking story illustrates a theme that runs throughout the book - the power of perspective shifting. People respond to incentives, which are often created by an environment they don’t fully control. And they’re biased. If you want, or need, something from another person take time to see the world from their perspective. Learn the rules of the game. This is doable, but not easy:
Sometimes it's a little bit uncomfortable if the person you're putting the shoes on doesn't think that much of you. But being aware of that can be powerful. And that just goes to the overall theme of the book. If you understand the rules of the game, how things actually work, what their motivations are, you can succeed. Those disadvantages can turn into advantages.
Step Backward To Go Forward
One way to understand the rules is a game-theory technique called backward induction. Start at the last stage of a process. What decisions are made at that final point? Then take one step backwards. What decisions get you to that previous stage? Keep going and you start to see the full, often complex, picture of all the important decisions. At first glance that seems overwhelming, but the exercise can clarify, and simplify, how to successfully play the game.
Fairweather used this approach to navigate the promotion process when she worked at a tech company. To get promoted she first needed her manager's approval, then approval from all of the next-level directors, who choose a smaller list that got passed up to a vice-president who made the final call.
Zooming in on that last step of the vice president giving the final okay, I put myself in his shoes. What does he care about? It seemed like he cared most about knowing whether his directors were being truthful, whether they were bullshitting him about what was going on. That seemed to be the focus of almost every meeting I was in with him. For the promotions I knew he’d be thinking - is there anything suspicious in this list? So my focus began to be making myself impressive enough to the vice president where he would be suspicious if I was not on the promotion list. And I had to do that publicly so that all the directors would know, because the directors were trying to please the vice president. It doesn't do me any good if the vice president likes me, but the directors don't know it.
When To Drop Anchor
A huge part of navigating a career is negotiation. As a business owner I negotiated leases, salaries, financing terms, etc. I always aimed to open the negotiation first, thinking that whatever number I initially put down would anchor all subsequent back-and-forth.
Fairweather says that approach is too narrow, it assumes the game never changes. Sometimes the other party might actually want you to establish the anchor. For instance, when she was applying for her current job, she was asked to list her salary. Recognizing that her reply would set an anchor, she instead listed the salary she would be willing to accept for switching jobs. She did some research to help calibrate the number, but it was a much higher figure than her salary and immediately set a more attractive negotiation range.
The key is first step is understanding how you are perceived by your negotiating counterparty. If they think you don’t have much money, or don’t have much interest in their product, let them open up. Chances are you’ll get a low anchor and can buy on the cheap.
One question that nagged at me while reading the book was the title. Why “Hate The Game” when she obviously loves game theory?
I think that when a lot of young people become aware of how capitalism or the economy is unfair, they stop there and they get down on themselves and feel like, things are rigged against me, why should I even try? My answer to them is that they should learn the ways in which the economy is unfair so that they can navigate it. Even though it's unfair, you can still win. You can win games where you have disadvantages. I really do believe that. So that's it - don't hate the player, hate the game.
Listen to my conservation with Daryl Fairweather on The Ideas Lab podcast:
Ordered the book. I am looking forward to reading it.