Information Assymetry

Thirty plus years on this planet have taught me that the root of all evil and many misunderstandings is due to information assymetry. Our experiences and sociocultural background skew the lens we use to perceive the world making us less emphatic and more judgmental of the motivation of our fellow humans. Assuming good intent is barely considered when analyzing someone’s drive, ambition and even their inaction.

I can count with my fingers the times my counterparts realized that there was a discrepancy between what they were feeling and what was really occuring. They couldn’t fathom being wrong or much less give the other parties involved the benefit of the doubt. It’s scary to learn people are driven by their emotions first and reason second, throwing logic and forbearance out the window to avoid putting themselves in other people’s shoes. Their discomfort and pain is more important than reaching an agreement, than consolidating the multiple realities that encompass the truth’s relative nature. As an introvert is even harder to comprehend why people can’t take a step back and brace themselves; perhaps my ability to Groundhog Day every situation until I understand all possibilities is a task too daunting for those who think having the loudest voice is the only thing that matters.

In economic terms, this phenomenon is observed when one of the parties conducting a transaction has greater material knowledge about a financial trade than the other. Generally, sellers will have more information on the product or service being offered than the buyer, leaving it to their own desires and interests to ask the questions necessary to assess the value of the goods or services exchanged. Sellers may leave out the condition of a roof in an MLS post just to get the house listed and sold as is; buyers may be stretching or exaggerating their acquisition power by playing chicken on important items that they simply couldn’t afford unless the figured out they were being misled. Wars have been fought over small misunderstandings that eroded trust and manipulated the parties into believing the other side doesn’t care about reaching an equilibrium; we are content with extracting out of the negotiation what is best for ourselves and not for everyone invited to the table.

I’m flabbergasted by the little faux pas I make every day when in comes to disseminating information because I forget to paint a complete picture for those I am seeking to assist or please. Stating your intentions is not enough, you need to follow through with actions and implementation plans that show you are committed to finding the best possible outcome. You have to embody what you preach, and then some, using every tactic in the book to win over their trust and cooperation. It is hard to make every deal an integrative one; enhancing the pie and giving everyone a bigger piece is counterintuitive when most agents and principals just want to get more than others to satisfy their needs. Mixing social norms with market norms also confuses things. You can offer someone money for a task amd completely loose their support and alliance because they felt offended by the offer.

Finding a balance between what information is relevant and what isn’t is also the maim reason why information assymetry endures. You need to know what the other person values, what they want to know and what they want to remain hidden to be effective at passing on the data required to make the relationships and exchanges work to our mutual advantage. If you reveal too much, you lose. If you reveal too little, it may come back to bite you. Knowing when to play and when to fold your cards is imperative for your success. Learn to bluff mindfully, to fail often and bounce baxk quickly, and to think on your feet without resorting to lies and vague commitments. Walk out of every conversation knowing you were sincere and open minded, leaving room to be persuaded or to adjust your beliefs and interests for the sake of keeping things civil.

We are all guilty of spreading half truths and gossip, which is compounded by the fact that we don’t know that the information is accurate. Learn to admit rapidly when you are incorrect or on the wrong side of the issue to speed progress along. Eliminate the the need to always win, to always be right, and opt to be a champion for conflict resolution. Do not let greed or hubris turn you against the true best interest at heart. You’ll thank yourself later when those bridges remain available to you, and trust leads to loyalty, integrity and compassion.

Stay thirsty for knowledge, my friends…

 

 

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