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    Mediocracy - You Can Get It If You Really Want It
    By Martin Gardiner | January 28th 2013 01:12 PM | 1 comment | Print | E-mail | Track Comments
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    In his 2010 discussion paper Competitive careers as a way to mediocracy Professor of Business Administration, Matthias Kräkel, (presently at the Bonn Graduate School of Economics, Germany), provides a contemporary corollary to the well-known Peter Principle (1969). Which famously states that:

    “Individuals are promoted until they reach their level of incompetence.”

    Or, put another way,

    “Work is accomplished by those employees who have not yet reached their level of incompetence”.

    The new paper first defines a ‘Mediocracy’ as – “A society in which people with little (if any) talent and skill are dominant and highly influential.” And then gets down to the hardcore algebra. Using game-theoretic perspectives ;

    “We show that in competitive careers based on individual performance the least productive individuals may have the highest probabilities to be promoted to top positions. These individuals have the lowest fall-back positions and, hence, the highest incentives to succeed in career contests. This detrimental incentive effect exists irrespective of whether effort and talent are substitutes or complements in the underlying contest-success function. However, in case of complements the incentive effect may be outweighed by a productivity effect that favors high effort choices by the more talented individuals. Switching from wages-attached-to-jobs to pay-for-performance will work against mediocracy if applied to top jobs, but may be detrimental at lower career levels. The mediocracy problem will be aggravated if high-ability individuals decide to sandbag on lower career levels in order to avoid strong opponents at higher levels.

    (The paper was presented at the  German Economic Association of Business Administration, symposium 2010.)

    Comments

    Interesting. Perhaps this is an explanation of why I didn't live up to expectations, by others, in the business world. Perhaps it was an unconscious recognition that I lacked the skills to compete in corporate office politics (the practice of which I still find repugnant). Thus I became a facilitator for the mediocracy. I'm a sandbagger!