To keep your sanity, when everything seems like it's going wrong, focus on the one thing that's going right! - Author: Diamante Lavendar
I have been busy as a bee the last couple of days, only surfacing to watch the football early this afternoon and what a blooming disappointment that was, as we conceded a goal deep into injury time so only managed a draw.
Not a happy chappy is me, however, the research I have been doing has been worthwhile.
Whilst doing research for both my book and an article about the future of cryptocurrencies in 2022 I did stumble across a little story that is actually a recognised effect, and most probably you know an example of it.
Original Image by Michael Kleinsasser from Pixabay
The Cobra Effect
In India during colonial rule and in particular Delhi, the head British honcho realised that the city was being overrun with cobras. They had a cobra infestation problem. His solution was very simple. Can you guess what his solution was?
Yes, his solution was to offer money to the public for every cobra skin that was handed into the authorities. There would be a bounty paid for every cobra skin.
What a simple solution you might think. Offering the bounty was initially very successful and the number of cobras started to drop in the city.
However, some members of the public saw a golden opportunity to cash in. They were annoyed that this easy money was drying up. Can you guess what their answer to this was?
They started to breed cobras, and they actually set up cobra farms. They were getting rich as they were breeding more and more cobras, killing them, handing the skins to the authorities and getting paid for it.
Finally the British realised what was happening, so they stopped the bounty payments.
What was the effect of the British stopping the payments for cobra skins?
The Indians who were breeding the cobras, now had no reason to breed them, so they just released them. This now meant that there were even more cobras in Delhi than before the bounty program was implemented.
The term "The Cobra Effect" was coined by German economist Horst Siebert in his book of the same name in 2001. It is also known as perverse incentives.
Basically, the cobra effect is an unintended consequence when the proposed solution actually makes the problem worse.
Have you heard of the Cobra Effect? Can you think of any examples?
Here is one more example. It is also based on a pest infestation, but this time it was in Vietnam whilst it was being occupied by the French. It was not a cobra infestation but was a plague of rats in Hanoi. The French authorities offered a bounty for each rat tail that they were brought. Just like the cobra breeders, these guys thought they could make some quick and easy money and started to breed rats. It was quick and easy and they got their money for these rat tails. The French got wind of this, and stopped the bounty. The effect was that all these rats that were being bred were released into the city, and of course there were many more than before.
Last one from me and if you know any examples, do drop them in the comments and I might give you a wee surprise!
Airbus the maker of planes, thought they could improve the passengers flying experience by reducing noise in its cabins.
However when they removed the noise, they discovered that the cabin noise was covering up lots of unwanted noises such as toilets being flushed and babies crying. Instead of improving the passengers flying experience they had made it worse.
The Best Way to Avoid the Cobra Effect
Before you put a reward scheme in place, try and figure out a way to beat the scheme, then go back and adjust the rewards scheme until you can't beat it!
Thanks for reading and have a wonderful rest of your weekend!
Copyright @tengolotodo 2022 and yes All Rights Reserved. All images, words, and ramblings are from the author unless otherwise stated.
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I did know about perverse incentives, I studied them in economics when I majored in finance. And in Latin America there are many examples of them, we are specialists in putting perverse incentives in our economies. One example is the fondness for putting absurd controls in order to "protect" consumers that only end up rewarding corruption and harming small entrepreneurs and ultimately consumers that end up suffering the consequences of the inviable system sooner or later.
YOu with your background I would have expected to understand and of hear about them Eli. I would not say it is just Latam countries that do it, the UK has had more than its fair share of doing the same thing. Corruption all too often gets rewarded and I include politicians in that!
I’ve heard of this effect before and I think it’s more common than any of us realise. You just don’t always get to hear about them. The ones we do hear about often make the headlines.
The thought of a city overrun by Cobras absolutely terrifies me. I’m not scared of snakes but an infestation is the stuff of nightmares!! Glad I read this with my morning coffee not before I went to bed lol!!😂
Actually I don't like snakes, and I had too many runins with them when I worked in Africa lol but I lived to tell the tale.
As for the effect it happens all over the place and is very common. The I was only trying to help and end up making things worse realisation is most often a cobra effect. Heck yes, an infestation of them would be nightmare material!
I’ve come across a nest of snakes before in Greece. I came across them because one fell out of a tree! Made my wife jump with horror! She is very anti. I saw the others around the base of the tree and kept quiet about it!!
Good thing you said nothing to your wife, I think she would have freaked out. Hopefully they were not venomous!
I know! They might have been venomous but I sure didn't want to find out :-)
heck no, I had enough with snakes when working in Africa, I see one and I try to beat a hasty retreat lol
It's literally my first time hearing a Cobra Effect, uncle Ed.
You would be surprised how common it is Mrs P, when you try to help but only make things worse!
I really had to look it up, uncle Ed!
Thank you, This is inspiring!
My pleasure Mrs P:) Aside from the fact that I don't like snakes, I did find it interesting:)
Same! But very enlightening reading!
Fascinating!!! I have to question the sanity of those releasing the cobras and rats though!!! Surely that quite literally came back to bite them!
haha yes it did come back to bite them 🤣🤣
The sanity, well not sure how sane they were if breeding cobras!
Breeding them is a lot safer than turning them loose and stepping on them 🤣
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haha well that is true I guess, I don't them full stop, had too many encounters with them in Africa for my liking 🤣🤣
Sounds adventurous :) ... You must have some great stories!!!
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hehe one or two, I have written some on read:)
Nice ❤️ You have me curious
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My daughter hates taking a shower so to get her to take a bath, we added bubbles to her bath. She, however, enjoyed taking a bath so much now that we can't take her out of her tub. She'd get colds too sometimes because she spends too much time in the bath. Is that also an example of the cobra effect? It's my first time hearing about it but it's interesting to know
oo! That is a perfect example of the cobra effect. We see it all the time, but don't realise it is actually a coined term. So often we try to help with a problem and end up making it worse. I hope she doesn't get too cold though! thank you for commenting, that was a great example.
Ohh thanks for letting us know how to call it. Sometimes, it is difficult to solve our dilemmas that our solutions end up making things worse. For the cobras, another solution is to hire people that would terminate the cobras themselves. But, we'll never know, some may find ways to exploit that solution. Argh, do you know how people avoid the cobra effect?
Yes hiring people especially to cull the cobras would have been one example, and I am sure they thought that would be too expensive, so they came up with a solution they thought would be cheaper. Haha but it was a disaster.
People should look at a problem and all solutions, before deciding which solution to do.
Sometimes doing nothing is actually the best solution, especially if you do do something and only make the problem worse!
Haha I like that solution: doing nothing
hehe oo sometimes it really is the best way :)
A rewards system can always be abused and taken advantage of by greedy people. :(
oo and they end up ruining it for everyone else!
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