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A funny thing about observation 1 (which is sadly true) is that in the traditional economics literature on the choice for a firm to “buy” an input (hire a consultant) or “make” the input (assign a faculty committee to make recommendations) is that an *advantage* of “buy” is supposed to be “well, at least we know exactly what it will cost”, whereas “make” has all sorts of hard-to-measure opportunity costs

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Well, and also, you can throw the bought input into the garbage; getting rid of the made input isn't just a question of what it cost to make it but the political price of dumping it. I've had this pointed out to me in terms of why universities so rarely ask a faculty member who has specific relevant expertise to a specific technical problem for what they think, and the answer is partly, "because it's harder to tell that person that their advice is dumb or impractical."

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Man how do I get on that gravy train?

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See, I think this isn't even great for the folks who get sent out on a lot of these contracts--the really small firms have thin margins; the bigger ones have the same fierce competition within the firm to move up to senior or lead that a big law firm does. I've noticed over the years that at least one of the big recruiting firms appears to have a lot of turnover, which doesn't surprise me.

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