054: Christine Exley on the Economics of Volunteering, Market Failure in the Homeless Dog Market and Wagaroo
Christine Exley is Professor of Business Administration at Harvard Business School. Christine is also Co-founder and Chief of Research at Wagaroo – an organisation dedicated to re-house homeless dogs to responsible and loving families.
Wagaroo was founded to bring a simple principle to life: When it comes to getting a pet, it’s time to make it easier for people to do the right thing! No puppy mills. No backyard breeders. Just owners, rescues, responsible breeders, and shelters working together to find great homes for dogs who need them. Find out more at wagaroo.com.
This episode is dedicated to Pepper, Christine’s family pet dog who recently passed away. Pepper is the Pit Bull that Christine mentions in this episode whom she rescued from a dog shelter.
In this interview, Christine mentions: gender differences, labor markets, incentives, market failure, search costs, information asymmetry, supply, demand, thick and thin markets, labor markets and wage elasticities.
In this episode you will learn:
- the use of assumptions in economic models for testing.
- how to encourage volunteering and whether monetary incentives work.
- how a trip to Honduras changed Christine’s academic path from mathematics to economics.
- how a story about an individuals’ plight can be a powerful message to have people react in a charitable manner, while the plight of millions with no media coverage of a personal story of suffering could become less powerful.
- about Wagaroo and why Christine set it up to help save dogs from puppy mills.
- what are thick and thin markets.
- how to spot an irresponsible dog breeder.
- about the family2family programme run by Wagaroo.
- how localised knowledge is key to separate the responsible dog breeder from the irresponsible breeder.
- why more must be done to regulate and protect animals.
- how Christine saved a pups life from a dog shelter when she was 17 and became her family pet.
- why people put in less effort once they hit a target.
- about the motivating benefits of rewarding volunteers with gift cards rather than a cash equivalent.
- how virtual rewards, like stickers and badges, can incentivise people to rmeet targets.
- how people’s perceptions of Pit Bull are an Econ 101 thing!
Quotes by Christine in Episode 54 of the Economic Rockstar Podcast:
On the successful family2family programme run by Wagaroo: “As an economist I’m very pleased with how clean and, in a sense, compatible that is” – Christine Exley
Market Failure in the Market for Homeless Pets
Two of the biggest ones arise from search costs. It’s really hard to find the dog you’re looking for. There are thousands of organisations globally that have dogs. There are thousands, if not millions, of families each year that need to re-home dogs.
The heterogeneity in types of dogs – different sizes, ages, breeds and personalities. The inventory is not always up-to-date. It’s hard to coordinate among multiple actors. It’s a disaster. Trying to find out all of that information is challenging.
Information asymmetry is another market failure. Often people on the other side have more information about the dog than you do. Sometimes no one has information on the dog. Maybe the dog was found on the street and we have no idea what’s this dogs history is or how this dog would interact in different environments.
There are many fundamental challenges that really make it a tricky market.
There’s actually about 2 million dogs and cats every year that are killed because they don’t find homes. So there’s certainly a surplus so to speak of dogs and cats.
Up to 23 million people are interested in acquiring a pet for their family in any given year. The vast majority are open to multiple sources – adoption, buying from a breeder.
It’s very easy for bad actors to imitate good actors – Christine Exley
- Getting up at 5:45 am and Running