2min chapter

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Rationally Speaking #240 - David Manheim on "Goodhart's Law and why metrics fail"

Rationally Speaking Podcast

CHAPTER

How to Maximize the Total Dollar Value of Sales

One category of Good Heart's Law is when people genuinely just have different incentives. In a telemarketing company, for example, maybe the management cares about the profits of the company. Upper management cares whether the company is doing well over the long run or not. But the workers themselves do not care. So that would be a case of misaligned incentives that are at odds.

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