Studio in Leuven

Its over, almost over and I even booked my tickets back to Bangalore on Jul 31st which leaves my Studio open for rent from August 1st. Given the audience of this blog, I thought it might be a good idea to publish a post about the Studio so I can save on spending an extra month’s rent, my contract ends August 31st :)

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  • Small Room (dont exactly know the dimensions).. but adequate for me and I’m 6 feet tall.
  • Free TV, Bed, Couch, Table, Study chair, Utensils and some forks and knives (Practically furnished)
  • Own toilet and shower with hot water ofcourse…
  • Huge Kitchen shared by two (My house mate who is in the first year of college), Kitchen is all yours from Friday afternoon until Monday morning because he is Belgian and goes back home every weekend
  • Oh, I forgot to mention Free Fridge and Vacuum Cleaner
  • Internet is free as well with a free wireless adapter (which I’m not carrying back home), but highly unreliable..
  • Studying at home is not a good idea, although very quite… I never really studied in my Studio
  • Oh, btw, I was the first tenant and first resident in the room, so its fairly clean
  • Rent was 325 Euros this year… but not sure how much it will be next year… I doubt it will be increased because of strict rent controls in Leuven
  • Oh free heater ofcourse.. you dont have to worry abou that
  • Electricity is excluded in rent, it was 270 Euros for the whole 10 months for me
  • Since its on the top floor, free view of the moon and stars as you sleep… I’m not kidding!! If you need complete darkness before sleep, this might not be the place for you except in winters!
  • Finally, and beleive me most importantly, the landlord (Jeff) and his mom who dont live here are really nice people.
  • Pictures are here: I must warn you I’m a very good photographer and the place in the snaps looks much nicer than in reality :)
  • Oh, btw.. free microwave too along with super nice electric stove!!

Studio available on the market from August 1st!

Rationality of Irrationality

Now that it is job hunting season, which it has been for a while for most students, my assumption is that it’s not only hard to find good opportunities in the current economy, but even more difficult to negotiate on good pay terms once opportunities are found. The reason is when the potential employee has a very low BATNA (Best alternative to negotiated agreement), the employer can indeed push terms favorable to him forcefully.

In analyzing this situation, I concluded that it is more beneficial to be irrational rather than rational… For example, let’s say X’s aspiration base is $ 300,000 (Yes, I know that’s an outrageous aspiration aka investment bankers’ aspiration… hehe) and his base expectation is $ 200,000 (I think I should remember what one of the investment banks told students a few months back – that they plan to hire 1 employee from Belgium!).

Any case, X finds and is chosen for an opportunity in company Y and it can afford to pay $ 250,000 and yet Y, given the current situation, only offers $ 150,000. Now let’s say X’s next best opportunity is a job at Z (not as desirable as Y’s offer) and pays only $ 100,000. What should X do?!

The rational choice in this case might appear to be that X must accept Y’s offer of $ 150,000 while knowing fully that he deserves the $ 250,000 that Y can afford to pay. Yet, I believe it might also be rational to accept Z’s offer and reject Y!

X has a very weak BATNA. In this case, it appears to me that one of the rational choices is to be irrational and not accept Y’s offer hoping that Y will not have a better BATNA either and therefore will offer to pay at least $ 200,000 which is X’s base aspiration! Of course, this depends upon what is Y’s BATNA… but the bottom line is when you have nothing to negotiate with, irrationality might be the only affordable tactic :) I guess this is the basis of the Chicken game… but interesting to think which kind of applicants would have enough courage to play that game.

Opportunity cost

Its Friday and Its a silly post :)

Recently, during lunch… I told my colleague that everything in life can be explained by economics :) I could tell she did not agree with it… or at the very least she thought I’d gone crazy… I’ve wondered if I truly meant it or if I was only exaggerating… I’m beginning to realize that I meant it :) Here’s an example of how much in life can be explained by economics.

Death! why do we fear dying? We don’t fear it for what will happen after death because clearly after death, nothing happens or can happen. OK, a religious person would believe he/she will reach heaven which is not a reason to be fearful of. I doubt anybody truly believes they will reach hell because we all have moral justification for everything we do :)

So why then do we fear dying? Economics can explain it… The reason we fear dying is the “opportunity cost” of being dead… the opportunity cost is everything we could have done by being alive instead of being dead :)