| Topic Name: |
Medical School or Law School? |
| Message Name: |
Economics of law |
| Date Posted: |
10/12/2001 |
| In Reply To: |
1. Associates bill at rates much higher than they are paid for. Therefore, partners make money on associates. Plain and simple, and to deny it is futile and insane.
2. Yes, of course it is called capitalism. What a brilliant discovery.
3. There is no luck in me being a doctor. It's called HARD WORK, dummy. |
| Message: |
Hmmm,
I am not sure you understand the economics of either profession.
Associates are billed out at a rate more than they are paid. However, most 1 and 2 yr assoicates actually lose money becuase of (massive) overhead and cut time/reduced billing. Therefore the partner generally won't see much profit on an associate until the 3rd yr. Its a risk that the partner(s) has to take, that the associate will make money.
If the associate turns partner at year 7 or 8, then the partner has had only 3-5 years to make money off of the associate's billing. That's why attrition is so expensive to a firm.
For example, my firm does not make money on me until I bill 1500 hours or so in the year.
Karen and Guadornak may do this differently.
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