Wednesday, November 19, 2014

Personal Reputations

Personal reputations develop over time and are based on how we choose to act in certain aspects of our lives. A reputation is formed by people judging your actions and analyzing your social and educational progress. Some people feel strongly that is important to have a good reputation. As a result, they work harder to be successful and monitor how they act and converse with others. The description of this week’s post touches on how people have many domains, and a person’s reputation differs within each.

Throughout my life, I have felt that it was important to have a good reputation with members of my family, particularly my immediate family. I always wanted to make sure my parents were proud of me and that I was the type of person that my younger siblings could look up to. When I was younger, my reputation was mainly focused around how nice I was to my siblings and other peers. Truthfully, I was on a bit of a short leash when I was younger. I was very nice with other children but I was always giving my siblings the business, whether that was fighting with them or poking fun at them. At a certain point, I found myself losing privileges or getting grounded when “being mean” to my younger siblings. As I got older, I matured and began to build better relationships with my brother and sister. I also began to feel the pressure to do well in school. As the years went on the classes got more difficult, I showed my parents I was an intelligent and driven individual by getting good grades. I continued this work into high school to make sure I kept my reputation as a good student intact. In addition to getting good grades, I made sure to stay out of trouble in high school. I never had a detention, made sure to never ditched classes, and tried to stay away from the party scene so I wouldn't have any run ins with the law. I asked I would help my parents with little errands, such as going to the grocery store or carting my brother or sister to or from school, sports, and friends’ houses. As a result, my parents had a lot of respect for me and trusted I would make smart choices. This came with certain benefits, like getting to stay out later or getting reimbursed for running errands.

Today, I still feel that my reputation within the family is important and continue to work hard to be successful. I make sure that I keep in contact with them, giving everyone a call or text to see how the week, work, or school is going.


Now I’m not a perfect child. There were plenty of times that I liked to stray away from suggested behavior. It is a bit difficult to think of specific examples now, however, it could involve getting into one of the many arguments with my parents or siblings and/or attending an event I didn't have permission to go to. I never thought about “cashing it in,” because I never felt the need or want to. I knew that abandoning my reputation would not pay out in the long run. The actions that I chose over the years helped solidified a good reputation with my family, and set me up for all of my accomplishments.

Thursday, November 6, 2014

Principal-Agent Model

The principle-agent model in the real world arises when conflicts of interest take place between a principal and an agent. I have not been put into a situation in my life however; there are plenty of examples that can be looked within the public sector. One example of this model is the current dispute between the Barclays Bank and its shareholders.

I am a fairly big soccer fan and enjoy watching English Premier League soccer. My favorite premier league team is Manchester United whose net worth is approximately $420 million. The Manchester United football club is owned by Barclays Bank. Naturally, I have been monitoring this story on the off chance that it will affect the team.  Currently, the bank is facing much criticism from its shareholders for its excessive bonuses payments to its employees. Over a year ago the board voted for proposals to pay approximately 2.4 billion euros in bonuses for its employees. The shareholders feel that this is an extremely unnecessary and is an improper use of money, especially since much of the proposal is funded by them. Most feel they deserve higher dividends and/or that it should be invested into the Manchester United Football Club.

Barclays is faced with a difficult situation because the proposal is best for their own growth. Without the bonuses a large number of top executives threatened to part ways with the company. These being top executives, they could not afford to lose arguably the most important employees within their organization. As a result, the proposal was voted for in order to make sure they retain profits and continue to grow as a firm.


When two principles don’t see eye to eye, it is best to look at the opposing viewpoints and try to come up with a solution to the problem in which both sides come to a compromise. In this case, Barclays should have expressed the need for the bonuses, relaying that without them it could have impacted the net worth of the shareholders stake in the bank. In addition, Barclays could have agreed to lower the amount to money the proposal included. However, this is much more complex then it seems because there are so many players with different beliefs and viewpoints. Never the less, proper communication needs to be achieved to resolve tensions between parties and reached a reasonable solution to the problem. The Barclays Bank failed by satisfying the decision that was in their best interest while ignoring the shareholders. This may turn out to be an inefficient decision, leading to a decrease in the amount of shareholders over the next year.