The article discusses the historical anecdote known as the 'Cobra Effect' during the British Raj, where a bounty on cobras led to unintended consequences. Rather than reducing the cobra population, the bounty incentivized locals to breed cobras for profit, ultimately increasing their numbers when the bounty was cancelled. The article draws parallels to Major League Baseball's Prospect Promotion Incentive (PPI), which aims to encourage teams to promote young players quicker. However, similar perverse incentives threaten to undermine this goal, highlighting the complexities of human behavior in incentivized systems.
Instead of leading to a decrease in cobra populations, the bounty system encouraged locals to breed cobras for profit, ultimately causing the population to surge.
The Cobra Effect illustrates how well-intentioned plans can fail spectacularly when perverse incentives twist desired outcomes in unintended ways.
The MLB's Prospect Promotion Incentive, designed to reward clubs for promoting their young talent, is at risk of being gamed similarly to the Cobra Effect.
Incentives can backfire: while the PPI aims to accelerate player promotions, it risks the manipulation of service time, echoing the historical caution of the Cobra Effect.
#cobra-effect #perverse-incentives #mlb-prospect-promotion #service-time-manipulation #historical-anecdotes
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