Saturday, December 16, 2006

Exploding Offers

A number of my current and former students have lately been dealing with the nasty phenomenon of the “exploding offer,” whereby the offeror gives the offeree a deadline to decide whether to take the offer that is so imminent as to make it impossible for the offeree to explore other options seriously before she must decide whether to accept or reject the offer. I have no doubt that exploding offers exist in many contexts, but the three with which I’m most familiar are these: Offers of clerkships from judges to students; offers of publication from law journals to authors; and offers of tenure-track positions to entry-level legal academics.

Let’s begin by defining an exploding offer. Clerkship applicants sometimes get on-the-spot take-it-or-leave-it offers, which clearly count as exploding for my purposes. So do 24-hour deadlines from law journals, since 24 hours is usually not enough time to have an article expedited at other journals.* For entry-level tenure-track offers, even a one-month or longer deadline could count as exploding if it is made sufficiently early in the hiring season, say a month before the annual hiring conference. And indeed, in recent years, a small but growing number of schools have taken to interviewing and making offers well in advance of the conference. They do so, pretty clearly, to prey upon the risk aversion of candidates. A candidate with an offer from Law School X that expires on November 1 may accept it, even though she would much prefer to end up at school Y or Z, simply because of the risk that Y and Z will not make offers.

There are, nonetheless, legitimate reasons for schools to make exploding offers. Elite schools tend to be relatively unconstrained by budgetary factors year to year. Thus, if Harvard, Columbia, NYU or Yale, to name a few, decides that there are four terrific newcomers, it will make offers to all four. However, many schools have a discrete number of hiring lines in any given year. Say school Z has one line, and that candidate A is Z’s top choice. If Z gives A as much time as she wants to make up her mind, then if A waits until the end of the season to decide to go to Stanford over Z, Z is now out of luck. Their second choice, candidate B, may have by now accepted another offer (even if B would have preferred an offer from Z had one been made in a timely fashion), as may have third choice C and fourth choice D. To avoid being stuck in this position, it strikes me as not unreasonable for Z to ask A to use whatever leverage she has with the other schools that are pursuing her to make a relatively quick decision. Even a deadline would be reasonable as a way of ensuring that if A turns Z down, Z can still get to B before it’s too late.

But that’s a far cry from deliberately scheduling interviews, offers and deadlines in a way that artificially pressures candidates simply based on their risk aversion, even where substantial extra time will not jeopardize the offering school’s ability to make an offer to its second-choice candidate. And yet a growing number of schools are doing just this. I would have hoped that this would be a self-limiting phenomenon. A new faculty member who arrives at a school she believes unfairly played on her risk aversion may be more likely to look to make a lateral move sooner rather than later. But unfortunately, initial jobs are sticky, both because of the vagaries of the lateral market and because relocating has costs.

Finally, I realize that this whole post has a bias for individual prospective faculty members. Why, one might ask, should the faculty member’s choice be more important than that of the school? The answer, I think, is that where an individual faculty member begins her professional career makes a much greater difference to her than it does to the school. By contrast, in the clerkship context, the stakes are at least as high for a judge as they are for a law clerk, which is why I find the practice of exploding offers less problematic there.

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* Note to academics in other fields. Most law journals permit multiple, simultaneous submissions. Given the very large number of law journals and the still larger number of articles submitted to these journals annually, a system of exclusive submissions would probably not be practical without delaying publication of most articles until they cease to be timely. That said, some peer-reviewed law journals do require exclusive submissions, and so it’s possible that the system could adjust.