In October 2006, Netflix launched a contest. They offered a $1 million prize to any team that could improve their movie-recommendation software engine by 10%. Netflix’s global hackathon eventually engaged 30,000 engineers loosely organized and endlessly re-organized into hundreds of self-selected teams attempting to optimize their competitive profile. The winners took almost three years to“The Incorporeal Economy”
Test Blog
Social Capital and Social Distancing
Most of us have worked in high performance teams at some time. Those were the teams that took pride in doing what others said was impossible, where debate was open and energized and sometimes at high volume, where decisions were supported 100% and mistakes were recognized and corrected without recriminations. In short, those teams operated“Social Capital and Social Distancing”
The Central Planners and the Virus
“Only a crisis – actual or perceived – produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around.” – Milton Friedman When the COVID–19 virus began traveling the earth, the ideas that were lying around dated from the Spanish Flu epidemic in 1918 and the depression“The Central Planners and the Virus”
Crossing the Political-Economic Divide
How do entrepreneurs assess political risk? Other than Mark Zuckerberg, do they even think about it? Are technology companies and social networks on the side of the populists? Division is in the air. Everything I read and everything I hear is about the great global divide. The populists are rising up against the elites. The“Crossing the Political-Economic Divide”
The Labor Constraint
A few years ago I managed an NGO that served 20,000 subsistence farmers in Mali. I was surprised when I first arrived to find many of our farmers planting less than half their land. They might have 10 hectares but were planting only 2 or 3. The reason? Not enough labor to get it done“The Labor Constraint”
Surveillance Economics or Why Does My Barber Have an App?
Does my barber need an app? Contemplating that question opened up an intriguing can of worms… One of the more difficult aspects of economic analysis is the unfortunate fact that economies involve humans making decisions. The math works, but the results don’t follow the math because the humans don’t pay attention to the equations. Interest“Surveillance Economics or Why Does My Barber Have an App?”
Are You an Accountable Capitalist?
You may get this question in some future due diligence session from an investor, an investment banker working on your IPO or a potential acquirer. If the Accountable Capitalism Act proposed by Senator Warren becomes law, it will become a basic compliance checkpoint for all of us. As proposed, the law only affects companies with“Are You an Accountable Capitalist?”
Next Steps for this Fed?
Watching Fed Chairman Jerome Powell testify to our esteemed but largely innumerate members of Congress, I was reminded that once government begins a massive intervention in a market two things happen. First, the bureaucrats are reluctant to give up their new found power and will endeavor to keep the intervention going long past its usefulness.“Next Steps for this Fed?”
The World according to Z
At the recent F8 conference, Mark Zuckerberg jokes that; “We don’t exactly have the strongest reputation on privacy.” No one laughed. Clearly, his developer audience took user demands for privacy protection more seriously than Mr. Z. Other than the desperate need of a new speechwriter, what is going wrong with Facebook? In March, Zuckerberg published,“The World according to Z”
The Internet and the Long Tails of Political Discourse
Below is a graph of a standard normal frequency distribution. It was created with a random number generator but these types of distributions are also very common in nature. For example, if you count the kernels on the cobs from the 30,000 corn plants in an acre, that data will track a normal distribution. The“The Internet and the Long Tails of Political Discourse”