[hpkuarg]

That's fine. Considering the business Jane Street engages in is highly competitive (maybe even the most competitive in the world), if their hiring practices cause them to have lower productivity, the market will force them to correct their practices or go out of business.

In fact, historical evidence shows amply that the more competitive an industry, the less discrimination (of the sort that we talk about now, like on racial or ethnic grounds) is to be found; and the most regulated, monopolistic, or anti-competitive the field, the more such discrimination is found.

[woodruffw]

Independent of Jane Street, this is absolutely not true of investment or finance as a whole: there are dozens of large firms where entire management layers are made up of the corporate equivalent of "legacy" admissions.

Finance isn't a purely deductive field: you can't purely compete and reason your way past dumb luck and overwhelming access to liquidity. Institutional players have both, and are more than happy to hire their top performers' mediocre sons and nephews to keep them happy.

[pyb]

A classic rebuttal : https://danluu.com/tech-discrimination/

[hpkuarg]

Thank you for pointing me to this -- apparently it's not so classic that I have read it already. ;-)

Since I assume you didn't write it, I won't go into a point-by-point rebuttal of the points raised in this piece, but in the interest of keeping up the debate I will mention a few things.

Like many who think along these lines, there is a base fallacy assumed here by the author, which is that absent discrimination, the distribution of tech workers will resemble the distribution of the larger population. Perhaps it is the classical liberal tradition (that "all men are created equal") that leads us to believe this, but there is no reason to believe that any slice of the population must reflect the broader whole, no matter the subject at hand. Over half of the players in the NFL are black and only 0.1% Asian, out of about 13% and 6% of the general population respectively. About four-fifths of all cab drivers in the US are male. Billions of people enjoy running around the world and many millions compete in it, but the Kalenjin of Kenya comprise a stupid number of those at the very top levels of distance running. It's entirely plausible that Chinese, Indians, and Vietnamese (as mentioned) enter the profession at higher rates and succeed at higher rates than other groups without involving a cabal that favors them over other groups, or indeed even personal biases for or against.

This isn't to say that personal biases don't exist and the numerous anecdotes of objectionable behavior encountered by individuals who don't fit the typical "tech bro" mold are invalid. But words like "discrimination" must be precisely defined, and I favor one where it means legal or policy-based exclusion or subjugation of certain groups, contrasted against personal biases ("racism" when it comes to ethnic groups, "sexism" in gender, etc.). When older folks get fewer callbacks from interviews or women are seen as girlfriends at tech conferences, that's personal biases at play, but it is not the same thing as being discriminated against. When you conflate the two you head down a dangerous path that we're treading as a society now, which is the tendency towards totalitarian control of people's thoughts; and this cost must be weighed against any benefit.

It's interesting that the author specifically mentions the Townsend-Greenspan firm vis-a-vis the gender pay gap among economists, because that was a very example of where capitalists motivated by profit took advantage of the fact that women were paid less for equal work, hired such women for slightly more than their competition while still getting the same output, thereby both raising women economists' wages and making out with a handsome profit. It's an argument for letting the market play out. (I do question why the firm dissolved when Greenspan was appointed Fed chairman, instead of continuing on with their more competitive labor.)

This is getting long, so I'll conclude by reiterating what I see as two very salient points from the essay: "The market is just humans. It's humans all the way down", and "We can fix this, if we stop assuming the market will fix it for us".

Yes, the market is humans all the way down. The beauty of free markets is that it leaves the decision-making to the individual humans involved, and not an enlightened group of elites who think they can fix it by meddling. History is littered with examples of people who thought they can "fix this" and ended up making it worse -- so much so that we have a saying about it.

If you're interested in exploring this angle more, I'd be happy to point you to a few works in the literature who have made the argument way more clearly than I ever could.

[ausbah]

I highly doubt a multibillion company engaging in more widespread recruiting practices would be the difference between them succeeding and failing

[ceeplusplus]

I think you grossly overestimate the percentage of candidates at lower tier schools who would be qualified to pass a Jane Street (or really any HFT firm) interview. Even at the top schools the pass rate is incredibly low. In expectation you would be getting probably <5% of your new graduate/intern class from the entire bottom 80% of schools.

The quality level drops off very sharply after you go below the top 20-30 CS schools. It's just a matter of limited resources for recruiting. The common path taken by people who go to "lesser" schools is to grind really hard to get into a good MS or PhD program and then go to these firms.

[ausbah]

to be upfront, I don't buy that a company with such large resources couldn't recruit from a larger pool of school. I'm also not under any illusion about the caliber of student at upper vs lower ranked schools, I see it as a matter of equity and meritocracy

[hpkuarg]

Why not? Having a company with multiple billions of dollars doesn't in itself produce any returns without high quality labor to work it, especially in competition against other such multi-billion dollar companies. It might not fail this quarter or next, but inevitably they'll be chased out, if in fact the recruiting practices lead to lower productivity.