Maximizing Soul

I wrote this essay yesterday, and spent all day on it. I didn’t get anything else done. And in terms of the week coming up, that was an expensive thing to do. But as will become clear after reading this essay, I do not regret it one little bit.

David Perell on The Microwave Economy

David Perell’s latest essay resonated with me, and for multiple reasons. The essay is centered around a point that I have been playing around with for a while: we live in a society that overrates efficiency.

He uses the metaphor of a microwave meal in this essay. Not the kind of microwave meal that Krish Ashok has in mind, but rather the kind of microwave meal that a large number of urban Indians are increasingly familiar with. Cut packet, dump in a bowl, nuke and eat. That kind of microwave meal.

This is a meal robbed of its soul. It is functional, yes. It is, in its own way, nutritious enough. One could argue that it is tasty enough. But there is no romance, originality or effort in it. As Robert Pirsig might have put it, it is bereft of quality.1

Perell’s essay extends this point about the microwave meal to the economy.2 Most of what we do in our lives today is centered around the same misunderstanding of convenience that gave birth to the idea of a microwave meal. The result, as Perell puts it, is “an economy that prizes function over form and calls human nature “irrational”—one that over-applies rationality and undervalues the needs of the soul.”

What if, for example, I and my family decided to drive down to Goa for a holiday? Which route should we take? We would do exactly what every right-thinking person in our place would do: look up Google Maps. Whatever route Google Maps suggests is the one we will take. 

Here’s a quote from Zen and the Art of Motorcycle Maintenance, the first of Pirsig’s two books:

“The best ones connect from nowhere to nowhere, and have an alternative that gets you there quicker.”

He wrote this line in the context of learning which roads in America were the best for motorcycle riding, and the next two to three pages are lessons on how to ignore Google Maps. Google Maps wasn’t even on the horizon when the book was written, of course. It is just that Google Maps is the modern day evolution of the idea that Pirsig was battling when it came to choosing roads to ride on. 

That idea being efficiency.

A long, rambling drive through quiet serene countryside might mean an extra day, sure, but isn’t that a price worth paying – at least  worth considering? Pirsig isn’t arguing for never getting there, wherever “there” may be. He is saying the same thing that the poet did, years and years ago. We have lost the desire to stand and stare. The monk said the same thing when he spoke about the journey being as important as the destination. Getting there is important, of course it is. But how you get there is equally important, and we live in a society that doesn’t care about the journey anymore. 3

Our society over-applies rationality and undervalues the need of the soul. Pirsig knew this, of course. It is why the last part of his sentence speaks about an alternative that gets you there quicker. He knew the coming of Google Maps was just a matter of time.

Perell’s essay is a lament for what might have been: a world that prioritized the soul and not the other way around. There is a lot of truth in it, and I have absolutely no quarrel with Perell’s solution. But his essay helped me concretize something that I have been playing around with in my mind for quite a while, and that is what this essay is about.

Minimization, not Maximization

“We’ve overwhelmingly used our wealth to make the world cheaper instead of more beautiful, more functional instead of more meaningful.” 

That sentence, to me, is the core focus of David Perell’s essay, and I couldn’t agree more. In fact his argument grows even stronger on reflection, because I think the word cheaper is applicable to more than just prices. 

We have also used our wealth, for example, to make the world cheaper in the case of time.

I read more today than I did about ten years ago, but the reading is infinitely more bite-sized in comparison. I much prefer essays to books, blog posts to essays, and tweets to blog posts. 4 And I suspect I am not the only one. I can make the same argument in the case of sports. We as a society have deliberately and consciously chosen ODI’s over test matches, T20’s over ODI’s, and now of course we have The Hundred. Another argument: of all the hours that you have spent staring at video content across all devices, how many hours were spent in watching movies – as opposed to TV series, documentaries, YouTube videos or TikTok? 

When David Perell says that we have made the world cheaper, what I think he is saying is that we have figured out ways to cheapen the effort that we are willing to put into the act of consuming something. That something could be a meal, but it could also be extended to reading, viewing, or listening as well – and more besides. 5

The world has also been made cheaper in terms of effort.

I base my buying decisions on the buying decisions that others have made. My PowerPoint templates are standardized ones that Microsoft offers me. My tables in Excel are formatted as per the default mode, or based on the templates made available within the software. What to eat tonight is a function of an algorithm, the title of which is “popular in your area”. Relying upon my own research, or on serendipity is either a lost art, or has become one that is looked down upon.

I teach economics for a living, and the best definition of the subject that I have found comes from a textbook written by Alex Tabarrok and Tyler Cowen:

Economics is the study of how to get the most out of life.

The word “most” in that sentence necessarily implies optimization. And optimization necessarily implies maximizing something, or minimizing something. Getting the most out of life can be thought of in two ways. It could mean living life to the fullest (however you might define this for your own sake). It could also mean getting the most out of life by minimizing time, effort and cost spent on any activity. 6

Consider an example from my life. I love eating good food. In fact, the point of life, if you ask me, is to have as many good meals as possible. How can we apply the points in the paragraph above to my life?

A good meal on a Sunday, for example, could mean spending all day researching the best version of a recipe for a dish I have in mind, then walking to the market to get the best, freshest ingredients possible, then lovingly preparing them, and then getting the whole dish together, so that friends and family can have a wonderful, relaxed meal together.

I’d call that living life to the fullest. It is all but a guarantee that I get nothing else done on that Sunday, but I have maximized contentment.

On the other hand, I could just order the dish from a restaurant whose version I really like. Or I could decide that this particular dish is too expensive, and just make myself a sandwich instead.

I’d call this getting the most out of life by minimizing time, effort and cost. I haven’t maximized contentment, of course, but I have saved time and effort.

And as you may have guessed, I end up doing the latter far more than the former.

And this for something I really and truly love: eating. We feed our passions, even, by minimizing time, cost and effort, instead of maximizing contentment. Our necessities don’t stand a chance.

That is what we have become: a microwave economy.

The Rajan Economy

Chef Rajan is the chef de cuisine at the JW Marriott in Pune. He has, over the years, become a really good friend. By rights, he ought to be best friends with my doctor. For Chef Rajan has ensured over the past seven years or so that there are far too many inches on my waist. But it is for that very reason, of course, that he and I are such good friends. The man loves to feed people, bless him. 

The Rajan economy is his fiefdom in the JW Marriott. This fiefdom is the 24-hour restaurant in the lobby, called Spice Kitchen. 7 Procurement, staffing, menu design, day-to-day operations and customer relationship management – Chef Rajan is involved in all of these in one way or the other.

I, my extended family and a lot of other people in Pune are frequent visitors to his restaurant for a variety of reasons. There’s the attention to detail, the friendly customer service, the frequently changing menu and much else besides. But there is one non-negotiable rule that I’ve never broken, and he won’t consider breaking.

There’s never been a question about a discount on the bill.

Chefs who used to be in charge of the restaurant before him have waived off the bill on a couple of occasions – maybe a birthday being celebrated there, maybe some other occasion. Not, let me be clear, because I asked for it. It was their way of deepening the relationship with a customer. And once offered, of course, I was going to take it. Why wouldn’t I?

But ever since Chef Rajan has been in charge of the kitchen (which, if memory serves me right, was in 2015), there has never once been the suggestion of a discount. Not once.

And that has left me even happier as a customer over these past few years.

Because the Rajan economy is not about cost minimization. It is, instead, about maximizing customer delight. 8 The Sunday brunches, or brunches on special occasions such as Christmas day, are expensive affairs. 9 But I doubt anybody can walk away from that spread thinking that they did not get their money’s worth. The extent of the spread, its presentation, the quality of the ingredients, the number of times that freshly prepared batches are brought out of the kitchen – all of these speak to the quality of the restaurant. 10

Chef Rajan’s philosophy at the Spice Kitchen isn’t about cost minimization, it is about maximizing customer delight. Never once have I sat down for a meal at the Spice Kitchen and not been sent a little something that is over and above whatever is on the menu that day. If it is a special occasion, the little something could be quite elaborate. On other days, not so much. But there will always be a little bit more than expected, or a little bit more than is part of the stated deal.

You will pay full price, in other words, but you will get more than you bargained for.

I signed on for an online course conducted by Amit Varma last year, called The Art of Clear Writing. 11 It was a wonderfully organized course, and was slated to last a couple of months or so. But it is still not over! There is a community that has been formed of present and past students. Talks about writing are organized and a newsletter is in the works. Regular writing prompts are handed out to those who wish to continue practice writing. This writing regularly receives community-based feedback. Again, the price of the course is non-negotiable, but you will get more than you bargained for.

There are two ways to live life and conduct business, when thought about from the framework we have been dancing around in this essay so far. Charge the bare minimum and provide the bare minimum is one of them.

There is an argument to be made to go the Rajan/Amit way instead.

Soul Satisfaction is the Opposite of Cost Minimization

One of my favorite books to read was Anti-Fragile, by Nicholas Nassim Taleb. The key point in the book for me was that there are certain things in the world that don’t do well when exposed to risk. These things we call fragile. There are other things that don’t do badly when exposed to risk. These we call robust. 

Antifragility isn’t about not doing badly when exposed to risk. It is about getting better because of exposure to that risk. Or as he puts it in the book, robustness isn’t the opposite of fragility – it is antifragility.

In a similar vein, I think we have prayed for far too long at the altar of cost efficiency. We have focussed so much on ridding ourselves of inefficiencies in our society that we have killed off the idea of satisfying the soul.

But there is a very good reason for this – our ability to measure everything, everywhere. It may have been a blessing at one point of time, but today, I would call it a curse.

There is this part in a conversation between Tim Ferriss and Seth Godin in which Tim asks Seth about meditation. After Seth’s answer, Tim has a follow-up question about the length of time that Seth spends in meditating, and if Seth has a preference regarding time of day. Seth’s answer is worth quoting in its entirety:

“No. I don’t quantify that stuff. I quantify almost nothing in my life”

Our ability to measure and therefore quantify every single aspect of our lives is increasingly becoming a problem.12 The reason it is a problem is because quantification gives us the satisfaction of having done something about the task ahead of us – whatever that task may be. We have quantified our effort, and analyzing said quantification allows us to become “better” over time.

Let’s use a concrete example: I can measure the amount of time I spend staring at my phone daily. Apps that allow one to do this are freely available on, or even baked right into, all popular mobile operating systems. The reason I want to do this is because I have a lot of work to do in this quarter, and I want to minimize wasted time.

After a week of logging in the data, I can then decide how to either allocate my time on the phone better (more Kindle app, less Facebook), or reduce the number of minutes I spend on the phone daily. 

I might even get good at this. Maybe, after a month, I now spend markedly less time on the phone, and what little time I spend on it, I spend on “good” apps. The problem, however, is that I now have one more thing to do – track, analyze and optimize how I spend my time on the phone. 

That is, because I could measure time spent, I optimized it. The point, however, was to do more work this quarter, not analyze how I am spending my time instead. The quality of the work – what I refer to in this essay as soul satisfaction – is inherently immeasurable. And so we optimize the measurable, and continue to ignore the immeasurable.

It is, unfortunately, the immeasurable that is important.

Now you could, of course, attempt to measure the immeasurable. Chef Rajan, or somebody else at the Marriott could conduct a survey to find out how satisfied the customers are. Amit Varma might circulate a Google Form to find out how satisfied his students are with the course. 13

But even if this was attempted, the wrong thing would be quantified. 14 The customer’s satisfaction would be (imperfectly) measured. 

What we really want to measure is how soul-satisfied are the creators with their work, and measuring this is pointless: the creator already knows.

In our rush to find something to measure in order to prove that we are efficient, we measure, analyze and perfect cost, time and effort minimization. And we therefore fail to do what we set out to in the first place: good, high-quality work.

If you will forgive a lengthy extract in an already lengthy essay, David Perell points this out in his essay as well:

As Mumford observed almost a century ago, the world loses its soul when we place too much weight on the ideal of total quantification. By doing so, we stop valuing what we know to be true, but can’t articulate. Rituals lose their significance, possessions lose their meaning, and things are valued only for their apparent utility. To resist the totalizing, but ultimately short-sighted fingers of quantification, many cultures invented words to describe things that exist but can’t be defined. Chinese architecture follows the philosophy of Feng Shui, which describes the invisible — but very real — forces that bind the earth, the universe, and humanity together. Taoist philosophy understands “the thing that cannot be grasped” as a concept that can be internalized only through the actual experience of living. Moving westward, the French novelist Antoine de Saint-Exupéry said: “It is only with the heart that one can see rightly; what is essential is invisible to the eye.” And in Zen and the Art of Motorcycle Maintenance, Robert Pirsig describes how quality can’t be defined empirically because it transcends the limits of language. He insists that quality can only be explained with analogies, summarizing his ideas as such: “When analytic thought, the knife, is applied to experience, something is always killed in the process.” All these examples use different words to capture the same idea.

https://perell.com/essay/the-microwave-economy/

But a headlong rush to measure, analyze and optimize the measurable has resulted in us losing sight of the big picture. We have become a society of optimization through minimization. We’ve become very good at extracting the very last bit of juice out of a lemon. So good, in fact, that we’ve forgotten all about growing more lemons. 15

The point was to be as content as possible. We’ve settled instead for being as content as we possibly can be after minimizing costs, time and effort.

Soul Satisfaction Maximization

It is a mouthful, I’ll be the first to admit. And if anybody reading this can coin a better phrase, I’m all for using that one instead. But call it what you will, it is the idea that I am focused on, not its name. We need to move away from minimizing that which we can measure, and try and move towards maximizing that which we can’t.

Cowen and Tabbarok’s definition remains perfectly valid. Economics is indeed about getting the most out of life. All of us are often unclear about what we are optimizing for in life. Is it a fulfilling family life, or is it income, or is it something else? Every economics professor will sooner and later ask her student: “what are you optimizing for?”

I’d suggest a follow-up question: how are you optimizing for it?

And by way of example, let us return to my favorite thing to think about: food.

If, on a Monday night, you are wondering what to cook, don’t think about which recipe can be made as quickly as possible. That would be time, effort and cost minimization.

Choose instead, the recipe you want to make, and cut out everything else in your life that stops you from making that recipe. And if this still doesn’t give you enough time, then try to see if you can eliminate certain steps in the recipe. See if certain steps can be done in advance. See if hacks can be used to accelerate certain processes.

In other words, what you want to maximize is non-negotiable. Don’t give up on your dream. But compromises in order to achieve that dream – well, that is inevitable. 

Let me put it another way. Consider these two statements:

  1. This is all I have to give. Under these circumstances, which dream is most attainable?
  2. This is my dream. Given my circumstances, what do I need to do to attain it?

I argue that we have, as a society, grown far too comfortable with the first idea, and we need to learn to do more of the second.

But whatever you do, don’t microwave a meal. 

  1. I am a huge, unabashed fan of Robert Pirsig, and so is David Perell. Pirsig will make numerous appearances in this essay: consider yourselves warned.[]
  2. I’d go a step further and say that it is equally applicable to society at large. But I’d rather not go down the rabbit hole of teasing apart the differences between an economy and society in this essay, so I’ll use society from here on in, unless I’m quoting from Perell’s essay.[]
  3. NH4 until Kolhapur and then turn right for Amboli is what we usually do, in case you were wondering.[]
  4. “Prefer” here is used in the context of what I end up actually consuming of each, as opposed to what I claim to prefer.[]
  5. Perell’s essay has a lovely section on the music bit, especially. Do read it.[]
  6. And it could, of course also mean both at the same time. But even in this scenario, which of the two one focuses on the most is going to get us back to the point of this essay.[]
  7. His role has changed over the years, of course, and is greatly expanded today. For the purpose of this essay, I will focus on just the one restaurant.[]
  8. Which, over the long run, ought to lead to true profit maximization. But this footnote is another essay in the making, so we will leave it at that.[]
  9. By Pune’s standards. They are cheap compared to what’s on offer in Bombay.[]
  10. Taste is a subjective thing, and so I’ve left it out of the discussion here.[]
  11. Any shortcomings in this essay are down to me, of course, not Amit![]
  12. I can measure my pulse rate, my O2 levels, my hours of sound sleep, the number of steps I have walked, the number of calories I have consumed, the number of minutes I have spent looking at my phone (and with drilldowns to boot) and a dozen other things with just a smartwatch and my phone. And then tabulate it, analyze it and improve upon it.[]
  13. Neither of them have done any such thing.[]
  14. And it would be imprecisely quantified, but that is a story for another day[]
  15. And if I may be permitted to squeeze every last bit out of this analogy: or growing mangoes instead.[]

Nilay Patel interviewed Marques Brownlee, and I took notes. Lots of notes.

I’ve been watching MKBHD videos for a while now, but a favorite activity for my daughter and I this past summer has been to watch them together.

As anybody who has watched them will attest to, they’re impeccably produced, and always manage to strike that perfect balance between being fun and informative. And trust me, getting that balance right is hard. But my daughter, who notices these things much more than I do, also points out his (Marques Brownlee‘s) diction, the way he sets up his backgrounds (or set, or whatever you call it) – and also how much better his voice seems to be than in other videos.

And since she’s mentioned it, it’s hard to ignore. It’s clear that a lot of work goes into producing these videos – and to put out over a hundred of them in one year is seriously impressive – which his channel did last year. What’s even more impressive is the fact that he plans to launch more channels this year, let alone videos.

I got to know about this in a very well done podcast, in which Nilay Patel spoke with Marques about what I wrote about in the preceding paragraph, and a whole host of things besides. Reading the transcript as an economist was interesting, for a lot of things resonated with concepts we teach (and don’t, but should) in class. They weren’t referring to the concepts, of course, for both are (probably) blessedly unaware of boring ol’ econ texts – they were just solving, or thinking, about the challenges they face in the course of their work.

But if you’re somewhere between the age of 18 to 24, and wondering where the hell (and how) to apply things we teach you in your classes – well what better way to learn than this? Ec101 applied to MKBHD videos – whatay way to learn, no?

Notes and brief explanations follow:

  • “You’ve got to embrace uncertainty.”

    A point that both of them agreed upon, and the context was noise in the background. As a statistician, when I think noise, I’m thinking randomness, and that makes this quote even better. You can have the most refined system in the world for doing stuff, but you have to make leeway for unanticipated stuff. Things can go wrong, pandemics can spread, neighbours can make lots of noise. Anticipate it: embrace it!

    The larger point, in simpler words: make a plan, of course, but budget for chaos. It’s always there.
  • “I couldn’t believe I was finding something that I didn’t see in those other videos. So I was like, the obvious answer is to add to that collection of information, so when someone else is choosing what to buy, they can make a better choice than I did.”

    Scratch your own itch is advice that you often hear in entrepreneur world, and Marques is speaking about exactly that over here. Except of course, he isn’t just speaking about it, he is quite literally doing it. In fact, he did it 11 years ago, and has just kept at it ever since. That’s a pretty good business model, if you ask me.

    Teach like you wish you had been taught is what I want to do in life, by the way, although I cannot claim to have come anywhere close to figuring a business model out.
  • “So there’s a lot more going on, but I think the teamwork of it all is something that can be pretty underrated.”

    Marques says this in the context of how he plans to scale up his work this year. Here’s the thing – learning how to do something (assuming you want to learn it in the first place) is a lot of fun. Teaching others how to do it is also a whole lot of fun.

    Building a team of such people, and getting them to do what you want to get done – and that too, just so – that is oh-my-god-hard. “Pretty underrated”? That’s pretty understated!
  • “We have a big cast of characters at The Verge. MKBHD, that’s just you. You are a pretty unscalable property. That group of people you’re bringing in and hiring, is that to help you spend more time in front of the camera or is that an attempt to scale you in a different way?”

    Marques’ answer is pretty instructive, but if you’re looking to start a business, and looking to scale it, one challenge you will face is getting folks to do what you want them to do, plus anticipating the fact that in businesses such as this one, Marques himself is the biggest draw. Imagine The Seen and the Unseen without Amit Varma, or Mark Wiens’ videos without Mark Wiens. You have two choices: plan on not scaling, or fight a very hard battle. It’s easy to draw a diagram that teaches you the theory of scaling – doing it in the real world is bloody hard.
  • “You were just intently focused on completing a motion graphics course that you had been taking. And now it’s several years later and you’re not that deep in the weeds. You’ve just hired a motion graphics person and you’re talking about scaling your business and using your facilities in a different way.”

    That’s part of a question that Nilay asked Marques, but if you’re not thinking pin factory, your econ prof and you need to talk. One important part of scaling is what Adam Smith referred to as the division of labor. You can’t – nobody can – do every single thing in a business. Some parts of it need to be outsourced to lawyers and PR firms, as they speak about in the interview later, some parts to motion graphics persons – whatever.

    But you have to let certain tasks go. Which tasks? To whom? How to recruit the most perfect person possible? How to get that person to stay? How to get that person to work with the other folks on the team? Pretty underrated indeed!

    Oh and by the way, this part we don’t teach you in college. We should, if you ask me, but we don’t.
  • “We’ve basically shot all of our videos with my directors on Zoom and I’m just like, “man, this is not even close.” It’s very fun, and then that novelty fades and you just miss having everybody there.”

    This might not be true (hopefully!) after 2021, but if you’re looking to intern this summer, or start work this year, this is a real problem. Americans have this thing they call “watercooler conversations”. If you’re Indian, we’re talking about chai/sutta breaks. Doesn’t matter if you’re a smoker or not, that’s not the point. Conversations in a more relaxed environment after you’ve been in the heat of battle together is where informal debriefings happen, and that is going to suffer this year. There are businesses trying to virtualize this – but color me skeptical. In person is always better, and that’s the worst part of graduating in this of all years.
  • “One question from our video team that I thought was really interesting: as you’ve been on the path of growing bigger and bigger, you haven’t had a boss. How do you grow and improve when the audience is overwhelmingly telling you that you’re great? Where do you find the incentive or the self-criticism to improve? You’ve obviously wildly improved over time, but where does that really come from?”

    Marques’ answer to this question is worth reading in its entirety, but the larger point is that you need people who have the ability to give you frank feedback. That’s hugely underrated. A spouse, a friend, a significant other, a business partner, a junior – whoever. But you need it!

    This reminds me of a reply that Seth Godin gave to a question Tim Ferris asked him in a podcast some years ago:

    “But the other kind is so rare, so scarce, so precious I only get little dribs of it now and then. Which is someone who gets you, someone who can see right through to your soul who, with generosity and care, can look you in the eye, hand you back something and say: I think this would be better if you did it again. I had a business partner, Steve, who was like that in 1979 and ’80, ’80 and ’81. And finding that again in a consistent way is really precious and really hard.”

    (It goes without saying: listen/read the whole interview. Just wonderful.)
  • “We’ve never really set view count goals, but we did have a goal to make 100 videos in the calendar year and we did end up doing that, which is great. A lot of that stuff that we’re aiming for is more, I guess qualitative is the word, but it’s hard to define.”

    What are you optimizing for? This is related to yesterday’s post, and it ought to be a question you ask yourself everyday. I don’t ask myself this question everyday, but I wish I did. It really and truly helps, because if what you are doing isn’t helping what you’re optimizing for, then you shouldn’t be doing it.

    Marques isn’t optimizing for views. He’s not looking to maximize hits, views or any of those metrics. He’s setting a target for quantity, as he says in the quote above, but he also is (implicitly in the quote, but trust me explicitly in his work) optimizing for quality. As I said towards the end of yesterday’s post, get the process right. The rest takes care of itself. (See also: Goodhart’s law)

    Also read this excerpt from Tyler Cowen’s interview of Jimmy Wales:

    “When we think about things at Wikipedia — for example, we could probably increase engagement if we use some of the very basic machine learning techniques to start showing people random promotional links to other things than Wikipedia and then have the machine learn over time how to show you links that are more interesting so that you end up staying on the site longer.

    Now, it might turn out that that’s completely normal and thoughtful, in fact, if you go to a well-known economist, that it turns out that the way to keep you on the site longer is to show you other concepts of economics and economic theory. But it might turn out, and probably would turn out, the best thing to do is, when you go to look up Tyler Cowen, to show you on the sidebar links to Kim Kardashian, Donald Trump, whatever the hot topic of the day is and so on, which is not really what you want from an encyclopedia.

    When we think about that, our incentive structure at Wikipedia is not to optimize time on-site. It’s to say, look, every now and then, normally at the end of the year, we say, “Hey, would you donate some money?” Nobody has to donate. The only reason people do donate — and this is what donors tell us — is they think, “This is meaningful. This is important to my life. This should live. This should exist.”

    Bottom-line: If you are not clear about what you’re optimizing for, you will struggle. Get that clear, for yourself, and be ruthless about sticking to it. (It’s easy for me to say this, but it is very difficult for me to do it. Just so we’re clear!)
  • “I live inside of Google Calendar and Google Tasks. I would be a lost human without those things. I kind of think about this a lot — how much time I spend doing the thing versus managing how we make the thing. And it turns out that the management part has become a lot more of my job, but almost necessarily, to make it a better thing.”

    Managing time is hard. It is really, really, really hard. I have tried I don’t know how many different things, apps, methods and what not, but it is hard. If you are going to make a plan (for spending your day, for studying for your exam, for starting a business, whatever) budget twice the amount of time you think you will take to do something, because you will waste time. That, I am sad to say, is my lived reality.

    Nilay’s next question is about exactly this, by the way.
  • “I think I tweeted a couple of weeks ago how many emails I get that are just like, “Hey, this is us. We’ve got this idea. When can we hop on a call?” But I don’t really want to do that. If you can’t get your idea down in a couple sentences in an email, it’s probably not a good enough idea.”

    Something that I have started to do over the last two years or so: whenever I have to give an assignment, it’s usually along these lines.

    “Write in fifteen sentences (or lesser) your understanding of [whatever it is that they’re supposed to write about]. No conjunctions, no colons, no semi-colons.”

    It is fascinating to me how what seems to be good news to the students turns out to be a problem, because Pascal.
  • “We say no to 99 percent of the things that we get offered to do. But that last 1 percent of things, we think very deeply about, and work with a lot of people to try to make the right decisions and pull it off well.”

    Derek Sivers has an interesting book about this.
  • “If it’s a bad product, it’s not worth doing it at all, even if we would’ve made a ton of money. If it’s a bad integration or if it’s a bad company to work with, I have to say no, because it just doesn’t fit. So that fit is often more important than the math of the per-minute or per-project basis.”

    The preceding questions (to this quote) are about what metrics Marques uses, and you should read about it if you are in this business, but the larger point is what Marques is saying here – and this was referred to earlier in this post as well. Metrics are all well and good, but do the work – and work means quality work. The rest follows.
  • “I know celebrity culture is different in everyone’s heads, but I look up to Michael Jordan the athlete and nothing else about him.”

    My personal opinion, but that is exactly how it should be. But that is a separate post in its own right.
  • “The way I see YouTube is, it’s kind of like driving for Uber. If you stop driving for Uber for a week, you won’t make any money that week. And I think adding more people to this team makes it feel like putting that Uber on autopilot so I’m not doing quite as much of the lifting, but it still has to drive.”

    Read The Four Hour Work Week.

Up until the last bullet point above, this post was 2,455 words in length. That, I suppose, is about enough for a blogpost. But there’s more, much more, in this interview. So please, read/listen to it in its entirety.

But hey, I’m clearly on a roll, so I cannot resist one final piece of advice. Take notes, and write down your thoughts about what you’ve consumed. Even if nobody else is ever going to read it.

It really and truly helps.

1917, Value in Use and Value in Exchange

It is one of the first concepts to be taught in introductory economics – or it ought to be, at any rate. Value in use, and value in exchange, that is.

The concepts simply mean that any particular thing – “good”, as we economists call it – has potential value either because we use it, or because we are able to sell it. Water, the canonical example, has clear value in use, but as a general rule, not that much value in exchange. That’s debatable, but we’ll move on for now.

You can either consume a good, or sell a good to buy other goods. The first is value in use, and the latter is value in exchange.

Here is a short explainer.


 

One of the most powerful movies I saw this year was 1917. For those of you who haven’t seen it yet, it shows you a slice – and a rather uncomfortable one – of what life was like during the Great War, or WWI. Read the review I’ve linked to, but also please watch the movie.


 

What do the two things I’ve spoken about have to do with one another?

In the movie 1917, the two protagonists are talking about a medal that one of them received for bravery. The recipient speaks about how he sold it for a bottle of wine.

I can’t find a clip of this on YouTube at the moment, but here’s a description of the scene from Vulture.com:

“After they cross through the German trenches — a sequence that starts with the men staring at bags of shit and only gets more harrowing from there — Blake and Schofield arrive in the open countryside. It’s a view not often seen in World War I movies, which rarely venture beyond the trenches, and it provides an opportunity for the film to slow down and relax. The soldiers get into a debate about whether there’s any meaning to be found in the war. Blake, who, true to his name, is the romantic of the pair, has learned that Schofield traded his Somme medal for a bottle of wine, and berates him. “You should have taken it home,” Blake says. “You should have given it to your family. Men have died for that. If I’d got a medal I’d take it back home. Why didn’t you take it home?”

Schofield disagrees, with the bitterness of a war poet: “Look, it’s just a bit of bloody tin. It doesn’t make you special. It doesn’t make any difference to anyone.””

That excerpt is from an email I sent to Amit Varma. It was meant to be a pitch for a series that used to run on a website called ThinkPragati (no longer up and running as a magazine, alas). The series was called Housefull Economics, and it seems as if I ended up writing the last column to appear in that space.

But what can’t be written there can be written here! That clip, the one that is described in the excerpt above, is a great way to think about value-in-use and value-in-exchange. Of what use is a piece of metal to Schofield? In war torn France, no use at all – in use.

But in exchange? Why, it got him a bottle of wine!


 

There is another concept at play over here, that of signaling. Blake is clearly horrified at the idea that something as valuable as a medal could be exchanged for something as trivial (to him) as a bottle of wine. Blake is effectively saying that sure, there may not be much value-in-use of the medal right now, but it has tremendous value in terms of signaling.

About which we shall speak a lot more on the coming Thursday, for signaling is a very fascinating topic indeed. But in the meantime, please do read the rest of the columns from the Housefull Economics series – they’re a great way to learn about economics!

India: Links for 8th July, 2019

  1. “The stark fact is that, by and large, there are few incentives for people to save water. There are few incentives for urban water utilities — who might lose 40 per cent of the water along the way— to become more efficient. There are few incentives for public investment in water supply. Needless to say, other than at the premium segment and in the unregulated tanker racket, no private investor will get anywhere close to the water supply business. That incentive is called price.”
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    Nitin Pai on one of the most important factors behind solving the water crisis: incentives.
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  2. “I would not be surprised if estate tax is reintroduced. The richest 10% of Indians own 77.4% of the country’s wealth. The bottom 60%, which is the majority of the population, owns 4.7%. The richest 1% own 51.5%. There is a huge gap between the rich and the poor, and estate tax can bring equality in distribution of income and wealth. This could be a significant step in that direction. Aside from the economic agenda, the reintroduction can be also politically guided.”
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    This post is being compiled on Friday, the 5th of July, 2019. The budget will say what it has to, and the estate tax may or may not come about. But this paragraph in particular, has much to unpack within it, as a student of economics. Best get a cup of coffee, sit with friends, and debate this piece threadbare.
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  3. ““I have no Homeland,” BR Ambedkar said to Mahatma Gandhi at their first meeting in 1931, “No self-respecting Untouchable worth the name will be proud of this land. The injustice and sufferings inflicted upon us are so enormous that if knowingly or unknowingly we fall prey to disloyalty to this country, the responsibility for that act would be solely hers.”Images of Ambedkar and Gandhi feature in Anubhav Sinha’s powerful film Article 15 – as in a scene where portraits of the two icons flank the desk of IPS officer Ayan (Ayushmann Khurrana), who is investigating caste murders in a small town.”
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    I have not yet seen this movie yet (although I certainly hope to. But that being said, I enjoyed reading this review, as do I enjoy reading practically anything written by Jai Arjun Singh. Scroll through to the bottom of the post for links to other reviews he’s done about movies related to caste in India.
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  4. “The irony, of course, is that not only that historian from a hundred years ago, but many even today, remain reluctant to embrace this aspect of our heritage and tradition. The colonizing of Indian minds in the colonial era by Victorian sensibilities was severe, added to which is generations of patriarchy—it will take time and patience before change comes to how history is imagined. Clubbing a courtesan with a mahatma may not immediately be understood or approved of by some. But that is precisely where the courtesan belongs, for, in the larger scheme of things and the big picture of our civilization, her role is no less significant than that galaxy of saints and monks we have all been taught to venerate.”
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    One, read this piece. Two, listen to this podcast. Three, buy this book. Each action will yield handsome returns.
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  5. “In 1962, India’s per capita GDP (in 2010 constant dollars) was almost twice that of China. India’s renewable internal freshwater resources per capita (henceforth per capita water), measured in cubic metres, was 75% of what it was for China in 1962. By 2014, the latest period for which water statistics are available, India’s per capita water had become 54% of what it was for China, even as China’s 2014 per capita GDP became 3.7 times that of India.”
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    We started with water in India, and let’s finish with water in India. An editorial from the Hindustan Times about water and how it has been (mis)managed in our country.

India: Links for 1st July, 2019

The usual five articles today, and as usual, about India. But there is a common theme that runs through them: that not just of agriculture, but also a tribute of sorts to a man about whom many more people should know.

 

  1. “It was time for a satyagraha — and not just in Gujarat. The late Sharad Joshi, leader of the Shetkari Sanghatana in Maharashtra, took around 10,000 farmers to Gujarat to stand with their fellows there. They sat in the fields of Bt cotton and basically said, ‘Over our dead bodies.’ Joshi’s point was simple: all other citizens of India have acesss to the latest technology from all over. They are all empowered with choice. Why should Indian farmers be held back?”
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    Today’s series is inspired by Amit Varma’s article yesterday in the Times of India, in which he speaks about farmers in India not getting access to technology, but also speaks about Sharad Joshi…
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  2. “Joshi’s insights in the late 1970 was that this was caused not by the greed of middlemen but the interference of the Indian state. The state had set forth rules that the farmer could not sell his produce in an open market, responding to supply and demand, but only to a government appointed body called the Agricultural Produce Market Committee (APMC). Because the farmers are not allowed to sell to anyone else, they are forced to take the price offered to them. And because all produce comes through the APMC, buyers also have no bargaining power.”
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    …about whom he has written earlier as well.
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  3. “Sharad Anantrao Joshi (3 September 1935 – 12 December 2015) was an Indian politician who founded the Swatantra Bharat Paksh party and Shetkari Sanghatana (farmers’ Organisation), He was also a Member of the Parliament of India representing Maharashtra in the Rajya Sabha, the upper house of the Indian Parliament during the period 5 July 2004 till 4 July 2010. On 9 January 2010 he was the sole MP in Rajya Sabha to vote against the bill providing 33% reservation for women in Indian parliament and assemblies.Sharad Anantrao Joshi was a member of Advisory Board of the World Agricultural Forum (WAF), the foremost global agricultural platform that initiates dialogue between those who can impact agriculture. He is also founder of Shetkari Sanghatana, an organisation for farmers. Shetakari Sanghatana is a non-political union of Farmers formed with the aim to “Freedom of access to markets and to Technology”
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    Who exactly was Sharad Joshi: the Wikipedia version
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  4. “In his massive rallies, Joshi would often speak of farmers as entrepreneurs who were shackled by statism. He campaigned for higher prices because he believed these were being kept artificially low by the government, but he insisted that what was really needed was to liberate Indian farmers from a web of state controls.He believed the solution was free markets. Joshi was perhaps a soulmate of another liberal leader of the farming community, N.G. Ranga, one of the founders of the Swatantra Party in 1959. It is perhaps not a coincidence that both Ranga and Joshi were economists by training.”
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    And to finish off today’s list, two articles that were written in his honor after he passed away four years ago. One from Livemint
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  5. “However, unlike many other farmer leaders who often ask for more subsidies and higher Minimum Support Prices (MSP) from the government, Sharad Joshi’s main instrument to better farm incomes was to seek economic freedom for farmers – freedom to obtain best farm technologies from anywhere in the world and the freedom to sell their produce anwhere across time and space and time. This he gathered from his early experience in farming.”
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    … and the other from TOI, written by Ashok Gulati.

Links for 30th May, 2019

  1. “While England are the clear favourites, the rest of the field is pretty even. Any team can beat any other on its day. India have their best-ever bowling attack in a World Cup, and Virat Kohli is the greatest batsman ever in this form of the game – but I am worried about their chances of winning it. The reason for that is strategic understanding. Kohli’s captaincy can be dubious at times in the shorter forms of the game, and he would consistently underestimate par scores while playing for his franchise in the IPL. The team has the talent to win – but does it have the approach?”
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    Amit Varma on how T20 changed the approach to ODI cricket, among other things. As always, worth reading.
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  2. “The result is the same – looking at all-time data, games where the team batting first scored between 200 and 250 are the most interesting. While games in this range remain interesting even after the 2015 World Cup, we find that games in the 250-300 range are on average more interesting, with interestingness sharply dropping off after 300.”
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    Karthik S. disagrees with Amit Varma’s article above – which is kind of the point of being a cricket fan. And that point, of course, spills over into other domains as well!
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  3. “The Louvre pyramid also highlights Pei’s tendency to recycle his own ideas. This practice is no disgrace if an abandoned original of merit is ultimately realized or improved with further development. Frank Lloyd Wright often dusted off plans for buildings that were sidelined for one reason or another and sometimes recycled them successfully. Pei’s first attempt to realize a monumental sloping glass structure was his initial 1966 proposal for the John F. Kennedy Library and Museum, for a site next to the Harvard campus in Cambridge.”
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    I know next to nothing about architecture (if that!), but I enjoyed reading this article about IM Pei. Tangentially, this also reminded me of A. R. Rehman and his decision to reuse some tracks for Slumdog Millionaire. The parallels are hard to miss – and therein lies a useful lesson.
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  4. “Given that robots can move through space in uniquely nonhuman ways, they wouldn’t necessarily be subject to boundaries between private and public spaces that constrain delivery people, allowing them to move goods in and out of homes in a constant flow. Amazon already has its “smart” lock system allow human carriers to enter a home briefly to drop off packages, and Wal-Mart is testing a similar system that lets its workers deliver groceries to a home’s refrigerator. But fully automated robots could travel deeper into homes without compromising privacy. You wouldn’t need to get dressed to greet a robot, if you noticed its arrival at all. It might unobtrusively enter and leave through an opening the size of a pet door.”
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    What all can robots do? The paragraph above, in particular, was striking to me. Here’s why: I thought of the problem in this way – what can robots change in the way homes are run? The excerpt forced me to think the other way around: how do homes need to change to best utilize robots? Again, a useful lesson! Both links above (3 and 4) are thanks to The Browser. I subscribe to it, and so far, I am not regretting it at all.
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  5. “China took the first shots, and they took them a long time ago. For over a decade U.S. services companies have been unilaterally shut out of the China market, even as Chinese alternatives had full reign, running on servers built with U.S. components (and likely using U.S. intellectual property).
    To be sure, China’s motivation was not necessarily protectionism, at least in the economic sense: what mattered most to the country’s ruling Communist Party was control of the flow of information. At the same time, from a narrow economic perspective, the truth is that China has been limiting the economic upside of U.S. companies far longer than the U.S. has tried to limit China’s.”
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    The USA hasn’t started the trade war with China under President Trump, it has responded to China’s “shots across the bows”. Please read the entire article, it is an important one.

Links for 9th May, 2019

  1. “Matters came to a head in the summer of 1745. Nanasaheb Peshwa was in Satara and his grandmother, Radhabai, lived in Pune. Seeing the water crisis, she ordered that no water be drawn from the river for the gardens. However, her order was challenged and a letter of complaint was written to the Peshwa in Satara.”
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    A very nice article in the Pune Mirror about the cities water supply, and how it originated and was developed over time. Also, if you haven’t heard it already, you might want to listen to this short introduction to Visvesvarya.
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  2. “This isn’t to say we don’t learn from these exercises. We do. In both India and Tanzania, we learn that citizens value public services. In Tanzania, the researchers then led deliberative discussions about cash transfers, and some respondents highlighted that “social services encourage a collective voice that helps increase accountability, while cash transfers would focus people on private interests and leave room for corruption.”Listen to the voices of citizens. But before throwing the cash transfer baby out with the bathwater, let’s make sure those citizens have clear information about their trade-offs.”
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    Beware well-intentioned surveys – read this article to find out why. Questions in surveys – and the framing of these questions – should give you a headache. If they don’t, you haven’t thought enough about ’em!
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  3. “Someone reading a book is a sign of order in the world,” wrote the poet Mary Ruefle. Four centuries earlier, while ushering in a new world order, Galileo contemplated how books give us superhuman powers — a sentiment his twentieth-century counterpart, Carl Sagan (November 9, 1934–December 20, 1996), echoed in his shimmering assertion that “a book is proof that humans are capable of working magic.”
    Do you subscribe to BrainPickings? You really should – and clicking through to this link is a good enough reason to start. Amit Varma had a column in the Times of India about much the same thing the other day, which is also worth reading for a rather more, um, practical example of the benefits of reading.
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  4. The lungi is more than just a South Indian sartorial choice. But what are the origins of this popular garment? It is difficult to state this with certainty. The lungi’s well regarded cousin, the dhoti, seems to have, on the whole, cornered much of the attention, in terms of research into its history on account of its elevated social standing.”
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    The Madras Courier on the lungi – its origins, how to wear it, and its apparent near universality.
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  5. “The new regulations have been harder on some of the smaller developers who lack the wherewithal to navigate the labyrinth that is getting construction permits on time causing many to exit the market. The Authority has no jurisdiction to hold different government departments to account for withholding or delaying approvals without a valid cause. Without accompanying reforms that ease the complex permissions process and bring about transparency and predictability in rule implementation, the objective of easing housing supply bottlenecks to lower house prices and benefit homebuyers is going to meet with limited success. ”
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    A short take on what ails the real estate sector in India. And the answer that this paper gives is that there may be too much regulation of the sector, not too little. A classic example of unintended consequences. This paper, from that article, is also worth reading.

Links for 15th April, 2019

  1. “But Bengaluru’s enthusiasm for pubbing as a well-established cultural and social activity pushes things along. Everyone meets over a beer—it is the new coffee. Work meetings are held over beer. Older millennials organize and participate in beer tastings and beer-and-food pairings. Co-working spaces like WeWork offer beer on tap. And most craft-beer lovers drink it not to get drunk, but for the taste and a mild high, as well as the social aspect of hanging out over a beer.”
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    I’ll be visiting Bangalore later on this week, and this couldn’t have come at a better time in Livemint! A long read, but informative in many ways about Bangalore and it’s modern drinking culture.
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  2. “Most people think that now is a terrible time to visit Iran. The renewed US sanctions on the country mean that popular travel websites like Expedia, Airbnb and Booking.com don’t work in Iran. International debit and credit cards can’t be used to make payments or withdraw money from ATMs. Most travel insurance policies don’t cover Iran. And social networks like Twitter and Facebook are technically banned.”
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    The rest of the article explains why, in fact, this is a pretty good time to visit Iran. Stunning photographs – Iran really does seem like it is worth a visit.
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  3. “Gradually, as the demand for Manbeasts increases, more Manbeasts will come forth. That’s supply and demand in action, and it’s a good thing. Manbeasts aren’t blind sloggers. They bring insane skill to the game, and it is glorious to watch. On top of everything else, Andre Russell is a bloody good batsman.”
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    Amit Varma explains T20 cricket using economics, at which he is rather good. Here’s the scary bit: Dre Russell is the start of the crazy hitting phenomenon, per Amit Varma. Read to find out why.
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  4. “Food delivery in India is creating an entirely new market; 70% of our regular users in Kolhapur had never tried food delivery in their life (even over a phone call), and Zomato was the first food delivery experience of their lives. All the marketing investment we made in FY19 will bear fruit in FY20 and beyond — when we realise the LTV (Lifetime Value) of the users that we have acquired.”
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    Zomato is a firm worth following for a variety of reasons: interesting business models, upfront communications, and Akshar Pathak does a great job too. But read the annual report for some fairly impressive statistics and trends about food in India.
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  5. “Great to hear! Check out this page: “Advice for Aspiring Astrophysicists” (and, if you’d like a shorter thread, this Storify). Basically you should learn a lot of math and physics and programming and communication skills, and, if at all possible, try to get involved in some kind of research. See the page for more tips. Good luck!”
    I, along with the rest of the planet, have been reading about astronomy for obvious reasons. This link was informal and informative – which is a very rare combination.

Links for 28th March, 2019

  1. “While nightlife and entertainment are certainly drivers of the night-time economy, they need not be the only ones. According to a report released by the London mayor’s office, 1.6 million people in London—constituting more than a third of the workforce—worked at night in 2017. Of these, 191,000 worked in health and 178,000 in professional services, with nightlife coming in third at 168,000. These were closely followed by transport, automotive, IT and education.In other words, the city’s nighttime economy is not merely bars and restaurants, but an extension of its day-time economic activities as well. It is estimated that the night component comprises 6-8% of the city’s economy and contributes £18-23 billion in gross value added to the British economy. The figures are approximations but significant enough for Mayor Sadiq Khan to champion the night-time economy and appoint a “Night Czar” to manage it.”
    In which Nitin Pai makes the argument for having more shops, establishments and services operate at night as well, in India. A useful read for students of urbanization, microeconomics and life in India.
  2. “I think that our economic system reflects our understanding of humankind, and that understanding has been developing, with especial rapidity lately. You have to understand people first before you can understand how to devise an economic system for them. And I think our understanding of people has been accelerating over the last century, or even half-century.”
    Robert Shiller chooses five books to help us understand capitalism better. I haven’t read all of them, and read one a very long time ago (Theory of Moral Sentiments) – but this has tempted me to go and read at least A.O. Hirschman’s book, if not all of them!
  3. “The problem with cricket in most cricket-playing countries, certainly in India, is that the cricket market is what economists call a monopsony. A monopsony is a market in which there is only one buyer for a particular class of goods and services. Until now, a young Indian cricketer who wanted to play at the highest level could only sell his services to the BCCI. If it treated him badly and did not give him his due rewards, he had no other options open to him.”
    I am happy to admit that I got the IPL gloriously wrong – I approached the IPL while wearing my cricketing purist hat, but I really should have approached it wearing my economist’s hat. Which is exactly what Amit Varma did, ten years ago. Monopsony, the power of markets, incentive mechanisms, it’s all here.
  4. “The 737 assembly line in Renton, Wash. is a marvel of lean manufacturing. The line inches forward little-by-little as assembly proceeds. Born from Toyota’s production methods, the process is one of continual improvement. It’s what made the 737 the lifeblood of Boeing in the first place and why this crisis, taken to its most extreme, could threaten the company’s very existence. But the assembly line also comes with a tool called an Andon cord. The cord empowers all employees to pull it and stop the line if something is amiss or requires investigation and needs fixing. The rest of the world has already pulled it.”
    A mostly understandable explanation of the possible reasons behind the crash – but when I say possible reasons, I do not mean the technical ones. Why compromises had to be made, and the impact of those compromises.
  5. “I’m happy for the descriptive part of economics to stay as it is. The prescriptive part, when we tell people what to do – that one should be much more broad. In fact, we should stop using just economics and take all kinds of ideas from psychology, sociology, anthropology, philosophy and economics, and test which ones work, which ones don’t work and under what conditions. There is no question that behaviour is the ultimate goal – to try to understand behaviour, and how to change or modify it. I hope we can create a discipline that is much more empirically based and data driven. Maybe we can call it “applied social sciences”. It will draw from all the social sciences equivalently as we approach problems in the real world, and try to find solutions for them.”
    Dan Ariely on five books that he’d recommend when it comes to understanding behavioral economics better. If you are interested in this topic, as I am, the interview is great reading – and the books too! I have not read Mindless Eating, and will begin it soon.