[rwallace]

The phrasing in your second paragraph is a little off target: the truth is if you're doing anything nontrivial you always want better people because they'll get the job done faster and better even if less skilled people could have done it at all. The real question is, why does Fog Creek think it is to its advantage to only hire potlatch participants, when such discrimination is usually irrational as well as unethical?

The answer, I think, is because they are in the unique position of being able to get away with it. In the normal course of events you'll do worse looking for candidates from Ivy League universities than from people who haven't gone to college because you're fishing in a pool that has already been thoroughly fished by your competitors. But Fog Creek frankly doesn't have very many competitors in this regard, at least not ones remotely in the same league. They seem to be so much better at hiring interns than almost anyone else (in the sense of having a strong brand name to attract attention in the first place, a rigorous selection process and generous offers to those selected) that they will probably be able to pick the cream of the crop no matter where they look, so they have no need to look further afield.

So I think it's a case where the number one player can get away with something the rest of us couldn't.

[gatehouse]

Side question: in what sense are you saying Ivy league is like a potlatch? Song-and-dance-and-reciprocity? Or conspicuous gift-giving (like "purity potlatch")? Or slave exchange?

[rwallace]

Signaling relative status by the destruction of valuable resources.