Salary Negotiations and Game Theory
https://www.nytimes.com/2018/08/10/smarter-living/how-to-negotiate-salary.html
One’s ability to negotiate on their salary is paramount, not only in their career, but amongst their entire life. According to an article published by the Society for Human Resource Management, approximately 39% of workers negotiated for a higher salary during their last job offer (https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/salary-negotiations-are-not-happening.aspx). Unbeknownst to many workers, salary negotiation can be the difference between making a comfortable salary, opposed to living paycheck-to-paycheck. Although there are a variety of reasons not to negotiate salary, including creating conflict and tension going into a job, the potential for ruining relationships with the employer, and the fear of being unsuccessful, the benefits of negotiating salaries far outweigh the negatives. In addition, assuming that you have a reason to negotiate salary, and can also back those claims up with evidence leaves the employee with no justification to avoiding salary negotiations. Furthermore, the New York Times article cited above explicitly proves the importance of salary negotiation, the appropriate way to negotiate an offered salary, and the evident ties to game theory that work in the favor of negotiation.
As stated in the article, “employers generally have a salary range, and if you’re at the point in the interview or hiring process where it’s time to discuss salary, it’s absolutely worth your time and emotional investment to prod about wiggle room.” Salary negotiation is a feasible opportunity, as employers have a significant amount to give, such as increases in salary, vacation days, health care, worker’s rights, and other benefits; and employees have room to gain, perfectly tying in game theory. “Game theory is concerned with situations in which decision-makers interact with one another, and in which the happiness of each participant with the outcome depends not just on his or her own decisions but on the decisions made by everyone” (Networks, Crowds, and Markets: Reasoning about a Highly Connected World, 156). With the proper research conducted prior to salary negotiations and the right game strategies, both employers and employees have the opportunity to foster a collaborative effort and relationship that can prove positive benefits for the company in the long run.