I’ve been thinking about where people choose to locate. I also discussed how big cities attract those looking for big success, yet this brings with is a high chance of failure. In many ways this boils down to choosing the right “pond” size and considering how big a “fish” one is.
What I mean is that most people care about “status” quite a bit, and we determine our status based on those around us. We compare ourselves to those in our “pond.” If you want higher status you can either 1) become a bigger fish, or 2) choose a smaller pond.
I’m not necessarily condoning status-concerns as how we should live our lives, yet as a matter of positive economics it helps me understand human behavior. For example, I already wrote how some parents might signal status by their choice of a baby’s name.
It is kind of funny, but perfectly human, to say “We are the champions…of the West Podunk six-man football league, ages 7 to 9 who were born on Tuesdays.” We constantly define “ponds” in ways that make us feel good about ourselves. “I got the highest grade in the class” or “I hit the most runs in April.” You might be valedictorian of your small, regional college and this will make you feel good even though you might be a below average student at an Ivy League.
We all, both consciously and sub-consciously, choose our ponds to our benefit. This is actually a good thing because most of us care how we stack up against others. If there was only one pond then all but one of us would be “losers.” By defining more ponds and then choosing our ponds we can all be pretty big fish somewhere.
Related to major life decisions, there are at least four major pond choices: where to go to school (esp. college), where to live (both city and neighborhood), where to work (both company and industry), and who to be in relationships with (e.g. spouse and close friends). These decisions might be described as a maximization problem in which a person with a given concern for status tries to be in the biggest pond for which he can be successful enough to be “happy.” I’ll call this the “optimal pond problem.”
There are of course trade-offs across pond types too. Being a lackluster Harvard student (i.e. small fish in the Harvard pond) will mean you are a bigger fish in the national pond than the valedictorian of a directional state school.
Presumably one also wants to reduce the pain of ending up as a small fish in a big pond. It might be more enjoyable to be the mayor of a small city rather than try and fail to be the mayor of a large city. You might prefer being the boss of a small company no one has heard of rather than an equally-paid middle manager at General Electric.
Choosing the right pond, however, can be difficult because we tend to overestimate our abilities. We need to figure out how we compare. To do so, it seems like a good strategy to go to the best schools possible and while there try to interact with those in other schools too (for example, via collegiate competitions). This will better inform you about how big a fish you are. (I knew many top-students from small town high schools who failed-out of first year engineering. Perhaps by no fault of their own, they were lead to believe they were bigger fish than they were.) Once you have a better idea about your fish size, you can choose your city and work sizes better. This is commonly called a “reality check.”
More Ponds Everyday
We should all admit we are quite good at mentally building new ponds. If we don’t feel great about how we stack up, we might arbitrarily censor the observations around us. We are creating new ponds all the time.
Yet, in the information age, other ponds are now available. For example, an awkward kid with quirky interests might be a small fish in his hometown. But, online he might find hundreds of other enthusiastic collectors of air sickness bags. He might find he is the #1 expert in this area in the whole world. From zero to hero just by switching ponds!
The proliferation of ponds through technology implies we all should be able to be high-status somewhere.