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katherineharron

These small business owners got Paycheck Protection loans, but they're afraid to use th... - 0 views

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shared by katherineharron on 14 May 20 - No Cached
  • Many small business owners who received loans from the federal Paycheck Protection Program say the program's rules are forcing them to make a difficult decision: Either take on more debt or spend money in ways that don't actually benefit their business.
  • At issue is a key rule that says in order for a PPP loan to be forgiven, a small business owner must spend at least 75% of it on payroll expenses in the first eight weeks of the loan. The remaining 25% may be spent on mortgage interest, rent, utilities and interest on other business-related debt obligations.
  • That means for businesses that had to shutter and let employees go, they must rehire their workers -- many of whom just started receiving unemployment benefits -- and pay them for eight weeks even though there is no work for them to do. Then one of two things will happen: the business won't be allowed to reopen yet and its employees will have to go back on unemployment; or the business may reopen, but have a hard time paying employees because it's unlikely to turn a profit quickly.
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  • Lisa Ashton had the same problem. She received a PPP loan for her business, Northern Lights Holistic, a wellness center in Portsmouth, Rhode Island. But she quickly realized she wouldn't be able to spend it in eight weeks, especially since her business won't be allowed to open before June 1. She called her bank and asked to give the money back.
  • "We'd rather survive and live to fight another day, even if eventually we owe the government some money," Huffman said.
  • Kurt Huffman, who owns the restaurant group ChefStable in Oregon, sees the PPP loan as a welcome lifeline but says the eight-week window to qualify for forgiveness is much too tight for restaurants.
  • "I told them the situation and I told them that it's going to be too much money for me to spend," Ashton said. Her bank agreed to take half back -- and she can now pay her 16 freelancers and rent through July 1, without accruing loan debt. "I won't have to worry about the interest or everything accumulating ... and being stuck with that payment. So I feel really good about that."
  • It's unclear whether either will happen. But a new report from the inspector general overseeing the Small Business Administration recommends that the SBA review its 75/25 rule for divvying up how the money must be spent. The IG noted that the law that created the program does not create any such restriction.
  • "The Paycheck program is underperforming because Treasury unilaterally required that 75% of the funds be used for payroll within eight weeks of receiving the loan," Seiberg wrote in a note to clients. "The frustration in Washington is that Treasury could unilaterally fix the problems tomorrow because it created them. ... If Treasury won't fix Paycheck, expect Congress to change the terms in the next stimulus."
Javier E

History News Network | An Open Letter to the Harvard Business School Dean Who Gave Hist... - 0 views

historynewsnetwork.org/...161267

business school teaching liberal arts trends economics

shared by Javier E on 03 Dec 15 - No Cached
  • I would like to make some gratuitous curricular and pedagogical suggestions for business schools.
  • Foremost, business schools, at least those that purport to mold leaders, should stop training and start educating. Their graduates should be able to think and problem-solve for themselves, not just copy the latest fad.
  • Business schools generally do not cultivate or even select for general intelligence and breadth of understanding but instead breed shrewdness and encourage narrow technical knowledge.
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  • To try to cover up the obvious shortcomings of their profoundly antisocial pedagogical model, many business schools tack on courses in ethics, corporate social responsibility, and the like, then shrug their collective shoulders when their graduates behave in ways that would make Vikings and pirates blush.
  • The only truly socially responsible management curriculum would be one built from the ground up out of the liberal arts – economics, of course, but also history, philosophy, political science, psychology, and sociology – because those are the core disciplines of social scientific and humanistic inquiry.
  • Properly understood, they are not “subjects” but ways of thinking about human beings, their behaviors, their institutions (of which businesses are just a small subset), and the ways they interact with the natural world. Only intelligent people with broad and deep backgrounds in the liberal arts can consistently make ethical decisions that are good for stakeholders, consumers, and the world they share.
  • Precisely because they are not deeply rooted in the liberal arts, many business schools try to inculcate messages into the brains of their students that are unscientific, mere fashions that cycle into and then out of popularity.
  • No one can seriously purport to understand corporate X (finance, formation, governance, social responsibility, etc.) today who does not understand X’s origins and subsequent development. Often, then, the historian of corporate X is the real expert, not the business school professor who did a little consulting, a few interviews, and a survey.
  • Lurking somewhere in the background of most great business leaders, ones who helped their companies, their customers, and the world, is a liberal arts education.
  • Instead of forcing students to choose between a broad liberal arts degree or a business career, business schools and liberal arts departments ought to work together to integrate all methods of knowing into a seamless whole focused on key questions and problems important to us all
  • There is not a single question of importance in the business world that does not have economic, historical, philosophical, political, psychological, and sociological components that are absolutely crucial to making good (right and moral) decisions. So why continue to divide understanding of the real world into hoary compartments
Javier E

Beyond Billboards - The Daily Dish | By Andrew Sullivan - 0 views

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Christianity Christmas myth sin

shared by Javier E on 12 Dec 10 - No Cached
  • The Atlantic Home todaysDate();Sunday, December 12, 2010Sunday, December 12, 2010 Go Follow the Atlantic » atlanticPrintlayoutnavigation()Politics Presented ByBack to the Gold Standard? Joshua GreenSenate Dems Lose Vote on 'Don't Ask' RepealMegan Scully & Dan FriedmanA Primary Challenge to Obama? Marc Ambinder Business Presented byif (typeof window.dartOrd == 'undefined') {window.dartOrd = ('000000000' + Math.ceil(Math.random()*1000000000).toString()).slice(-9);}jsProperties = 'TheAtlanticOnline/channel_business;pos=navlogo;sz=88x31,215x64;tile=1';document.write('');if( $(".adNavlogo").html().search("grey.gif") != -1 ){$(".adNavlogo").hide();}Will the Economy Get Jobs for Christmas?Daniel Indiviglio27 Key Facts About US ExportsDerek ThompsonThe Last StimulusDerek Thompson Culture Presented ByThe 10 Biggest Sports Stories of 2010Eleanor Barkhorn and Kevin Fallon al
  • at the force behind all that exists actually intervened in the consciousness of humankind in the form of a man so saturated in godliness that merely being near him healed people of the weight of the world's sins.
Javier E

How To Look Smart, Ctd - The Daily Dish | By Andrew Sullivan - 0 views

andrewsullivan.theatlantic.com/...how-to-look-smart-ctd-2.html

reading intelligence testing

shared by Javier E on 08 Feb 11 - No Cached
  • The Atlantic Home todaysDate();Tuesday, February 8, 2011Tuesday, February 8, 2011 Go Follow the Atlantic » Politics Presented by When Ronald Reagan Endorsed Ron Paul Joshua Green Epitaph for the DLC Marc Ambinder A Hard Time Raising Concerns About Egypt Chris Good Business Presented by Could a Hybrid Mortgage System Work? Daniel Indiviglio Fighting Bias in Academia Megan McArdle The Tech Revolution For Seniors Derek Thompson Culture Presented By 'Tiger Mother' Creates a New World Order James Fallows Justin Bieber: Daydream Believer James Parker <!-- /li
  • these questions tend to overlook the way IQ tests are designed. As a neuropsychologist who has administered hundreds of these measures, I can tell you that their structures reflect a deeply embedded bias toward intelligence as a function of reading skills
Javier E

George Packer: Is Amazon Bad for Books? : The New Yorker - 0 views

www.newyorker.com/...140217fa_fact_packer

book industry Amazon

shared by Javier E on 03 Mar 14 - No Cached
  • Amazon is a global superstore, like Walmart. It’s also a hardware manufacturer, like Apple, and a utility, like Con Edison, and a video distributor, like Netflix, and a book publisher, like Random House, and a production studio, like Paramount, and a literary magazine, like The Paris Review, and a grocery deliverer, like FreshDirect, and someday it might be a package service, like U.P.S. Its founder and chief executive, Jeff Bezos, also owns a major newspaper, the Washington Post. All these streams and tributaries make Amazon something radically new in the history of American business
  • Amazon is not just the “Everything Store,” to quote the title of Brad Stone’s rich chronicle of Bezos and his company; it’s more like the Everything. What remains constant is ambition, and the search for new things to be ambitious about.
  • It wasn’t a love of books that led him to start an online bookstore. “It was totally based on the property of books as a product,” Shel Kaphan, Bezos’s former deputy, says. Books are easy to ship and hard to break, and there was a major distribution warehouse in Oregon. Crucially, there are far too many books, in and out of print, to sell even a fraction of them at a physical store. The vast selection made possible by the Internet gave Amazon its initial advantage, and a wedge into selling everything else.
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  • it’s impossible to know for sure, but, according to one publisher’s estimate, book sales in the U.S. now make up no more than seven per cent of the company’s roughly seventy-five billion dollars in annual revenue.
  • A monopoly is dangerous because it concentrates so much economic power, but in the book business the prospect of a single owner of both the means of production and the modes of distribution is especially worrisome: it would give Amazon more control over the exchange of ideas than any company in U.S. history.
  • “The key to understanding Amazon is the hiring process,” one former employee said. “You’re not hired to do a particular job—you’re hired to be an Amazonian. Lots of managers had to take the Myers-Briggs personality tests. Eighty per cent of them came in two or three similar categories, and Bezos is the same: introverted, detail-oriented, engineer-type personality. Not musicians, designers, salesmen. The vast majority fall within the same personality type—people who graduate at the top of their class at M.I.T. and have no idea what to say to a woman in a bar.”
  • According to Marcus, Amazon executives considered publishing people “antediluvian losers with rotary phones and inventory systems designed in 1968 and warehouses full of crap.” Publishers kept no data on customers, making their bets on books a matter of instinct rather than metrics. They were full of inefficiences, starting with overpriced Manhattan offices.
  • For a smaller house, Amazon’s total discount can go as high as sixty per cent, which cuts deeply into already slim profit margins. Because Amazon manages its inventory so well, it often buys books from small publishers with the understanding that it can’t return them, for an even deeper discount
  • According to one insider, around 2008—when the company was selling far more than books, and was making twenty billion dollars a year in revenue, more than the combined sales of all other American bookstores—Amazon began thinking of content as central to its business. Authors started to be considered among the company’s most important customers. By then, Amazon had lost much of the market in selling music and videos to Apple and Netflix, and its relations with publishers were deteriorating
  • In its drive for profitability, Amazon did not raise retail prices; it simply squeezed its suppliers harder, much as Walmart had done with manufacturers. Amazon demanded ever-larger co-op fees and better shipping terms; publishers knew that they would stop being favored by the site’s recommendation algorithms if they didn’t comply. Eventually, they all did.
  • Brad Stone describes one campaign to pressure the most vulnerable publishers for better terms: internally, it was known as the Gazelle Project, after Bezos suggested “that Amazon should approach these small publishers the way a cheetah would pursue a sickly gazelle.”
  • ithout dropping co-op fees entirely, Amazon simplified its system: publishers were asked to hand over a percentage of their previous year’s sales on the site, as “marketing development funds.”
  • The figure keeps rising, though less for the giant pachyderms than for the sickly gazelles. According to the marketing executive, the larger houses, which used to pay two or three per cent of their net sales through Amazon, now relinquish five to seven per cent of gross sales, pushing Amazon’s percentage discount on books into the mid-fifties. Random House currently gives Amazon an effective discount of around fifty-three per cent.
  • In December, 1999, at the height of the dot-com mania, Time named Bezos its Person of the Year. “Amazon isn’t about technology or even commerce,” the breathless cover article announced. “Amazon is, like every other site on the Web, a content play.” Yet this was the moment, Marcus said, when “content” people were “on the way out.”
  • In 2004, he set up a lab in Silicon Valley that would build Amazon’s first piece of consumer hardware: a device for reading digital books. According to Stone’s book, Bezos told the executive running the project, “Proceed as if your goal is to put everyone selling physical books out of a job.”
  • By 2010, Amazon controlled ninety per cent of the market in digital books—a dominance that almost no company, in any industry, could claim. Its prohibitively low prices warded off competition
  • Lately, digital titles have levelled off at about thirty per cent of book sales.
  • The literary agent Andrew Wylie (whose firm represents me) says, “What Bezos wants is to drag the retail price down as low as he can get it—a dollar-ninety-nine, even ninety-nine cents. That’s the Apple play—‘What we want is traffic through our device, and we’ll do anything to get there.’ ” If customers grew used to paying just a few dollars for an e-book, how long before publishers would have to slash the cover price of all their titles?
  • As Apple and the publishers see it, the ruling ignored the context of the case: when the key events occurred, Amazon effectively had a monopoly in digital books and was selling them so cheaply that it resembled predatory pricing—a barrier to entry for potential competitors. Since then, Amazon’s share of the e-book market has dropped, levelling off at about sixty-five per cent, with the rest going largely to Apple and to Barnes &amp; Noble, which sells the Nook e-reader. In other words, before the feds stepped in, the agency model introduced competition to the market
  • But the court’s decision reflected a trend in legal thinking among liberals and conservatives alike, going back to the seventies, that looks at antitrust cases from the perspective of consumers, not producers: what matters is lowering prices, even if that goal comes at the expense of competition. Barry Lynn, a market-policy expert at the New America Foundation, said, “It’s one of the main factors that’s led to massive consolidation.”
  • The combination of ceaseless innovation and low-wage drudgery makes Amazon the epitome of a successful New Economy company. It’s hiring as fast as it can—nearly thirty thousand employees last year.
  • brick-and-mortar retailers employ forty-seven people for every ten million dollars in revenue earned; Amazon employs fourteen.
  • Since the arrival of the Kindle, the tension between Amazon and the publishers has become an open battle. The conflict reflects not only business antagonism amid technological change but a division between the two coasts, with different cultural styles and a philosophical disagreement about what techies call “disruption.”
  • Bezos told Charlie Rose, “Amazon is not happening to bookselling. The future is happening to bookselling.”
  • n Grandinetti’s view, the Kindle “has helped the book business make a more orderly transition to a mixed print and digital world than perhaps any other medium.” Compared with people who work in music, movies, and newspapers, he said, authors are well positioned to thrive. The old print world of scarcity—with a limited number of publishers and editors selecting which manuscripts to publish, and a limited number of bookstores selecting which titles to carry—is yielding to a world of digital abundance. Grandinetti told me that, in these new circumstances, a publisher’s job “is to build a megaphone.”
  • it offers an extremely popular self-publishing platform. Authors become Amazon partners, earning up to seventy per cent in royalties, as opposed to the fifteen per cent that authors typically make on hardcovers. Bezos touts the biggest successes, such as Theresa Ragan, whose self-published thrillers and romances have been downloaded hundreds of thousands of times. But one survey found that half of all self-published authors make less than five hundred dollars a year.
  • The business term for all this clear-cutting is “disintermediation”: the elimination of the “gatekeepers,” as Bezos calls the professionals who get in the customer’s way. There’s a populist inflection to Amazon’s propaganda, an argument against élitist institutions and for “the democratization of the means of production”—a common line of thought in the West Coast tech world
  • “Book publishing is a very human business, and Amazon is driven by algorithms and scale,” Sargent told me. When a house gets behind a new book, “well over two hundred people are pushing your book all over the place, handing it to people, talking about it. A mass of humans, all in one place, generating tremendous energy—that’s the magic potion of publishing.&nbsp;.&nbsp;.&nbsp;. That’s pretty hard to replicate in Amazon’s publishing world, where they have hundreds of thousands of titles.”
  • By producing its own original work, Amazon can sell more devices and sign up more Prime members—a major source of revenue. While the company was building the
  • Like the publishing venture, Amazon Studios set out to make the old “gatekeepers”—in this case, Hollywood agents and executives—obsolete. “We let the data drive what to put in front of customers,” Carr told the Wall Street Journal. “We don’t have tastemakers deciding what our customers should read, listen to, and watch.”
  • book publishers have been consolidating for several decades, under the ownership of media conglomerates like News Corporation, which squeeze them for profits, or holding companies such as Rivergroup, which strip them to service debt. The effect of all this corporatization, as with the replacement of independent booksellers by superstores, has been to privilege the blockbuster.
  • Publishers sometimes pass on this cost to authors, by redefining royalties as a percentage of the publisher’s receipts, not of the book’s list price. Recently, publishers say, Amazon began demanding an additional payment, amounting to approximately one per cent of net sales
  • the long-term outlook is discouraging. This is partly because Americans don’t read as many books as they used to—they are too busy doing other things with their devices—but also because of the relentless downward pressure on prices that Amazon enforces.
  • he digital market is awash with millions of barely edited titles, most of it dreck, while r
  • Amazon believes that its approach encourages ever more people to tell their stories to ever more people, and turns writers into entrepreneurs; the price per unit might be cheap, but the higher number of units sold, and the accompanying royalties, will make authors wealthier
  • In Friedman’s view, selling digital books at low prices will democratize reading: “What do you want as an author—to sell books to as few people as possible for as much as possible, or for as little as possible to as many readers as possible?”
  • The real talent, the people who are writers because they happen to be really good at writing—they aren’t going to be able to afford to do it.”
  • Seven-figure bidding wars still break out over potential blockbusters, even though these battles often turn out to be follies. The quest for publishing profits in an economy of scarcity drives the money toward a few big books. So does the gradual disappearance of book reviewers and knowledgeable booksellers, whose enthusiasm might have rescued a book from drowning in obscurity. When consumers are overwhelmed with choices, some experts argue, they all tend to buy the same well-known thing.
  • These trends point toward what the literary agent called “the rich getting richer, the poor getting poorer.” A few brand names at the top, a mass of unwashed titles down below, the middle hollowed out: the book business in the age of Amazon mirrors the widening inequality of the broader economy.
  • “If they did, in my opinion they would save the industry. They’d lose thirty per cent of their sales, but they would have an additional thirty per cent for every copy they sold, because they’d be selling directly to consumers. The industry thinks of itself as Procter &amp; Gamble*. What gave publishers the idea that this was some big goddam business? It’s not—it’s a tiny little business, selling to a bunch of odd people who read.”
  • Bezos is right: gatekeepers are inherently élitist, and some of them have been weakened, in no small part, because of their complacency and short-term thinking. But gatekeepers are also barriers against the complete commercialization of ideas, allowing new talent the time to develop and learn to tell difficult truths. When the last gatekeeper but one is gone, will Amazon care whether a book is any good?&nbsp;♦
kushnerha

BBC - Capital - Busy: A badge of honour or a big lie? - 0 views

www.bbc.com/...a-badge-of-honour-or-a-big-lie

bbc multitasking busyness productivity

shared by kushnerha on 23 Oct 15 - No Cached
  • idea of the “busy trap” to the overwhelming feeling many professionals have at the end of each day and week, overload is a real issue.
  • But what if we’re looking at the issue in the wrong way? What if you could reframe your thinking, feel less busy and perhaps get more done?
  • somewhere along the way we were convinced that being ‘busy’ was good for us
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  • “We’re not busy … we’re productive,” he wrote. “And yes, there’s a difference.”
  • “Busy paints a picture of people who are either keeping themselves occupied or who don’t have the time to do other things,” Spurlock explained. “Productive describes an environment rich with goals, personal and professional achievements and wrapped in success, a place where you're actually creating&nbsp;something vs just doing something.”
  • “Personal productivity… is the most important one, as it centres around the time that I make to spend with my family, my friends and doing things that fulfil me as a living person,”
  • Financial productivity is an important one, as these are the projects that create consistent revenue
  • “Being busy has somehow become a badge of honor. The prevailing notion is that if you aren’t super busy, you aren’t important or hard working,”
  • busyness makes you less productive
  • “When we think of a super busy person, we think of a ringing phone, a flood of emails and a schedule that’s bursting at the seams with major projects and side-projects hitting simultaneously,” he wrote. “Such a situation inevitably leads to multi-tasking and interruptions, which are both deadly to productivity.”
  • As Socrates said: Beware the barrenness of a busy life.
  • switching what you’re doing mid-task increases the time it takes you to finish both tasks by 25%
  • people an average of 15 minutes to return to their important projects… every time they were interrupted by e-mails, phone calls, or other messages
  • “We’re so enamored with multitasking that we think we’re getting more done, even though our brains aren’t physically capable of this,”
  • most productive when we manage our schedules enough to ensure that we can focus effectively on the task at hand
  • people use busyiness to “hide from… laziness and fear of failure”
Javier E

Economics of Good and Evil: The Quest for Economic Meaning from Gilgamesh to Wall Stree... - 1 views

DIIGO_FILE_HOME/7ui9/74ec4c99e72deda4a64da10692a15bf6

economics history literature good evil theory philosophy philosophers Bible Gilgamesh Adam Smith

shared by Javier E on 15 Aug 19 - No Cached
  • Instead of self-confident and self-centered answers, the author humbly asks fundamental questions: What is economics? What is its meaning? Where does this new religion, as it is sometimes called, come from? What are its possibilities and its limitations and borders, if there are any? Why are we so dependent on permanent growing of growth and growth of growing of growth? Where did the idea of progress come from, and where is it leading us? Why are so many economic debates accompanied by obsession and fanaticism?
  • The majority of our political parties act with a narrow materialistic focus when, in their programs, they present the economy and finance first; only then, somewhere at the end, do we find culture as something pasted on or as a libation for a couple of madmen.
  • most of them—consciously or unconsciously—accept and spread the Marxist thesis of the economic base and the spiritual superstructure.
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  • He tries to break free of narrow specialization and cross the boundaries between scientific disciplines. Expeditions beyond economics’ borders and its connection to history, philosophy, psychology, and ancient myths are not only refreshing, but necessary for understanding the world of the twenty-first century.
  • Reality is spun from stories, not from material. Zdeněk Neubauer
  • Before it was emancipated as a field, economics lived happily within subsets of philosophy—ethics, for example—miles away from today’s concept of economics as a mathematical-allocative science that views “soft sciences” with a scorn born from positivistic arrogance. But our thousand-year “education” is built on a deeper, broader, and oftentimes more solid base. It is worth knowing about.
  • Outside of our history, we have nothing more.
  • The study of the history of a certain field is not, as is commonly held, a useless display of its blind alleys or a collection of the field’s trials and errors (until we got it right), but history is the fullest possible scope of study of a menu that the given field can offer.
  • History of thought helps us to get rid of the intellectual brainwashing of the age, to see through the intellectual fashion of the day, and to take a couple of steps back.
  • “The separation between the history of a science, its philosophy, and the science itself dissolves into thin air, and so does the separation between science and non-science; differences between the scientific and unscientific are vanishing.”
  • we seek to chart the development of the economic ethos. We ask questions that come before any economic thinking can begin—both philosophically and, to a degree, historically. The area here lies at the very borders of economics—and often beyond. We may refer to this as protoeconomics (to borrow a term from protosociology) or, perhaps more fittingly, metaeconomics (to borrow a term from metaphysics).
  • stories; Adam Smith believed. As he puts it in The Theory of Moral Sentiments, “the desire of being believed, or the desire of persuading, of leading and directing other people, seems to be one of the strongest of all our natural desires.”
  • “The human mind is built to think in terms of narratives … in turn, much of human motivation comes from living through a story of our lives, a story that we tell to ourselves and that creates a framework of our motivation. Life could be just ‘one damn thing after another’ if it weren’t for such stories. The same is true for confidence in a nation, a company, or an institution. Great leaders are foremost creators of stories.”
  • contrary to what our textbooks say, economics is predominantly a normative field. Economics not only describes the world but is frequently about how the world should be (it should be effective, we have an ideal of perfect competition, an ideal of high-GDP growth in low inflation, the effort to achieve high competitiveness …). To this end, we create models, modern parables,
  • I will try to show that mathematics, models, equations, and statistics are just the tip of the iceberg of economics; that the biggest part of the iceberg of economic knowledge consists of everything else; and that disputes in economics are rather a battle of stories and various metanarratives than anything else.
  • That is the reason for this book: to look for economic thought in ancient myths and, vice versa, to look for myths in today’s economics.
  • is a paradox that a field that primarily studies values wants to be value-free. One more paradox is this: A field that believes in the invisible hand of the market wants to be without mysteries.
  • Almost all of the key concepts by which economics operates, both consciously and unconsciously, have a long history, and their roots extend predominantly outside the range of economics, and often completely beyond that of science.
  • The History of Animal Spirits: Dreams Never Sleep
  • In this sense, “the study of economics is too narrow and too fragmentary to lead to valid insight, unless complemented and completed by a study of metaeconomics.”17
  • The more important elements of a culture or field of inquiry such as economics are found in fundamental assumptions that adherents of all the various systems within the epoch unconsciously presuppose. Such assumptions appear so obvious that people do not know what they are assuming, because no other way of putting things has ever occurred to them, as the philosopher Alfred Whitehead notes in Adventures of Ideas.
  • I argue that economic questions were with mankind long before Adam Smith. I argue that the search for values in economics did not start with Adam Smith but culminated with him.
  • We should go beyond economics and study what beliefs are “behind the scenes,” ideas that have often become the dominant yet unspoken assumptions in our theories. Economics is surprisingly full of tautologies that economists are predominantly unaware of. I
  • argue that economics should seek, discover, and talk about its own values, although we have been taught that economics is a value-free science. I argue that none of this is true and that there is more religion, myth, and archetype in economics than there is mathematics.
  • In a way, this is a study of the evolution of both homo economicus and, more importantly, the history of the animal spirits within him. This book tries to study the evolution of the rational as well as the emotional and irrational side of human beings.
  • I argue that his most influential contribution to economics was ethical. His other thoughts had been clearly expressed long before him, whether on specialization, or on the principle of the invisible hand of the market. I try to show that the principle of the invisible hand of the market is much more ancient and developed long before Adam Smith. Traces of it appear even in the Epic of Gilgamesh, Hebrew thought, and in Christianity, and it is expressly stated by Aristophanes and Thomas Aquinas.
  • This is not a book on the thorough history of economic thought. The author aims instead to supplement certain chapters on the history of economic thought with a broader perspective and analysis of the influences that often escape the notice of economists and the wider public.
  • Progress (Naturalness and Civilization)
  • The Economy of Good and Evil
  • from his beginnings, man has been marked as a naturally unnatural creature, who for unique reasons surrounds himself with external possessions. Insatiability, both material and spiritual, are basic human metacharacteristics, which appear as early as the oldest myths and stories.
  • the Hebrews, with linear time, and later the Christians gave us the ideal (or amplified the Hebrew ideal) we now embrace. Then the classical economists secularized progress. How did we come to today’s progression of progress, and growth for growth’s sake?
  • The Need for Greed: The History of Consumption and Labor
  • Metamathematics From where did economics get the concept of numbers as the very foundation of the world?
  • mathematics at the core of economics, or is it just the icing of the cake, the tip of the iceberg of our field’s inquiry?
  • idea that we can manage to utilize our natural egoism, and that this evil is good for something, is an ancient philosophical and mythical concept. We will also look into the development of the ethos of homo economicus, the birth of “economic man.”
  • All of economics is, in the end, economics of good and evil. It is the telling of stories by people of people to people. Even the most sophisticated mathematical model is, de facto, a story, a parable, our effort to (rationally) grasp the world around us.
  • Masters of the Truth
  • Originally, truth was a domain of poems and stories, but today we perceive truth as something much more scientific, mathematical. Where does one go (to shop) for the truth? And who “has the truth” in our epoch?
  • Our animal spirits (something of a counterpart to rationality) are influenced by the archetype of the hero and our concept of what is good.
  • The entire history of ethics has been ruled by an effort to create a formula for the ethical rules of behavior. In the final chapter we will show the tautology of Max Utility, and we will discuss the concept of Max Good.
  • The History of the Invisible Hand of the Market and Homo Economicus
  • We understand “economics” to mean a broader field than just the production, distribution, and consumption of goods and services. We consider economics to be the study of human relations that are sometimes expressible in numbers, a study that deals with tradables, but one that also deals with nontradables (friendship, freedom, efficiency, growth).
  • When we mention economics in this book, we mean the mainstream perception of it, perhaps as best represented by Paul Samuelson.
  • By the term homo economicus, we mean the primary concept of economic anthropology. It comes from the concept of a rational individual, who, led by narrowly egotistical motives, sets out to maximize his benefit.
  • the Epic of Gilgamesh bears witness to the opposite—despite the fact that the first written clay fragments (such as notes and bookkeeping) of our ancestors may have been about business and war, the first written story is mainly about great friendship and adventure.
  • there is no mention of either money or war; for example, not once does anyone in the whole epic sell or purchase something.5 No nation conquers another, and we do not encounter a mention even of the threat of violence.
  • is a story of nature and civilization, of heroism, defiance, and the battle against the gods, and evil; an epic about wisdom, immortality, and also futility.
  • Gilgamesh becomes a hero not only due to his strength, but also due to discoveries and deeds whose importance were in large part economic—direct gaining of construction materials in the case of felling the cedar forest, stopping Enkidu from devastating Uruk’s economy, and discovering new desert routes during his expeditions.
  • Even today, we often consider the domain of humanity (human relations, love, friendship, beauty, art, etc.) to be unproductive;
  • Even today we live in Gilgamesh’s vision that human relations—and therefore humanity itself—are a disturbance to work and efficiency; that people would perform better if they did not “waste” their time and energy on nonproductive things.
  • But it is in friendship where—often by-the-way, as a side product, an externality—ideas and deeds are frequently performed or created that together can altogether change the face of society.19 Friendship can go against an ingrained system in places where an individual does not have the courage to do so himself or herself.
  • As Joseph Stiglitz says, One of the great “tricks” (some say “insights”) of neoclassical economics is to treat labour like any other factor of production. Output is written as a function of inputs—steel, machines, and labour. The mathematics treats labour like any other commodity, lulling one into thinking of labour like an ordinary commodity, such as steel or plastic.
  • Even the earliest cultures were aware of the value of cooperation on the working level—today we call this collegiality, fellowship, or, if you want to use a desecrated term, comradeship. These “lesser relationships” are useful and necessary for society and for companies because work can be done much faster and more effectively if people get along with each other on a human level
  • But true friendship, which becomes one of the central themes of the Epic of Gilgamesh, comes from completely different material than teamwork. Friendship, as C. S. Lewis accurately describes it, is completely uneconomical, unbiological, unnecessary for civilization, and an unneeded relationship
  • Here we have a beautiful example of the power of friendship, one that knows how to transform (or break down) a system and change a person. Enkidu, sent to Gilgamesh as a punishment from the gods, in the end becomes his faithful friend, and together they set out against the gods. Gilgamesh would never have gathered the courage to do something like that on his own—nor would Enkidu.
  • Due to their friendship, Gilgamesh and Enkidu then intend to stand up to the gods themselves and turn a holy tree into mere (construction) material they can handle almost freely, thereby making it a part of the city-construct, part of the building material of civilization, thus “enslaving” that which originally was part of wild nature. This is a beautiful proto-example of the shifting of the borders between the sacred and profane (secular)—and to a certain extent also an early illustration of the idea that nature is there to provide cities and people with raw material and production resources.
  • started with Babylonians—rural nature becomes just a supplier of raw materials, resources (and humans the source of human resources). Nature is not the garden in which humans were created and placed, which they should care for and which they should reside in, but becomes a mere reservoir for natural (re)sources.
  • But labour is unlike any other commodity. The work environment is of no concern for steel; we do not care about steel’s well-being.16
  • Both heroes change—each from opposite poles—into humans. In this context, a psychological dimension to the story may be useful: “Enkidu (…) is Gilgamesh’s alter ego, the dark, animal side of his soul, the complement to his restless heart. When Gilgamesh found Enkidu, he changed from a hated tyrant into the protector of his city. (…)
  • To be human seems to be somewhere in between, or both of these two. We
  • this moment of rebirth from an animal to a human state, the world’s oldest preserved epic implicitly hints at something highly important. Here we see what early cultures considered the beginning of civilization. Here is depicted the difference between people and animals or, better, savages. Here the epic quietly describes birth, the awakening of a conscious, civilized human. We are witnesses to the emancipation of humanity from animals,
  • The entire history of culture is dominated by an effort to become as independent as possible from the whims of nature.39 The more developed a civilization is, the more an individual is protected from nature and natural influences and knows how to create around him a constant or controllable environment to his liking.
  • The price we pay for independence from the whims of nature is dependence on our societies and civilizations. The more sophisticated a given society is as a whole, the less its members are able to survive on their own as individuals, without society.
  • The epic captures one of the greatest leaps in the development of the division of labor. Uruk itself is one of the oldest cities of all, and in the epic it reflects a historic step forward in specialization—in the direction of a new social city arrangement. Because of the city wall, people in the city can devote themselves to things other than worrying about their own safety, and they can continue to specialize more deeply.
  • Human life in the city gains a new dimension and suddenly it seems more natural to take up issues going beyond the life span of an individual. “The city wall symbolizes as well as founds the permanence of the city as an institution which will remain forever and give its inhabitants the certainty of unlimited safety, allowing them to start investing with an outlook reaching far beyond the borders of individual life.
  • The wall around the city of Uruk is, among other things, a symbol of an internal distancing from nature, a symbol of revolts against submission to laws that do not come under the control of man and that man can at most discover and use to his benefit.
  • “The chief thing which the common-sense individual wants is not satisfactions for the wants he had, but more, and better wants.”47
  • If a consumer buys something, theoretically it should rid him of one of his needs—and the aggregate of things they need should be decreased by one item. In reality, though, the aggregate of “I want to have” expands together with the growing aggregate of “I have.”
  • can be said that Enkidu was therefore happy in his natural state, because all of his needs were satiated. On the other hand, with people, it appears that the more a person has, the more developed and richer, the greater the number of his needs (including the unsaturated ones).
  • the Old Testament, this relationship is perceived completely differently. Man (humanity) is created in nature, in a garden. Man was supposed to care for the Garden of Eden and live in harmony with nature and the animals. Soon after creation, man walks naked and is not ashamed, de facto the same as the animals. What is characteristic is that man dresses (the natural state of creation itself is not enough for him), and he (literally and figuratively) covers52 himself—in shame after the fall.53
  • Nature is where one goes to hunt, collect crops, or gather the harvest. It is perceived as the saturator of our needs and nothing more. One goes back to the city to sleep and be “human.” On the contrary, evil resides in nature. Humbaba lives in the cedar forest, which also happens to be the reason to completely eradicate it.
  • Symbolically, then, we can view the entire issue from the standpoint of the epic in the following way: Our nature is insufficient, bad, evil, and good (humane) occurs only after emancipation from nature (from naturalness), through culturing and education. Humanity is considered as being in civilization.
  • The city was frequently (at least in older Jewish writings) a symbol of sin, degeneration, and decadence—nonhumanity. The Hebrews were originally a nomadic nation, one that avoided cities. It is no accident that the first important city57 mentioned in the Bible is proud Babylon,58 which God later turns to dust.
  • is enough, for example, to read the Book of Revelation to see how the vision of paradise developed from the deep Old Testament period, when paradise was a garden. John describes his vision of heaven as a city—paradise is in New Jerusalem, a city where the dimensions of the walls(!) are described in detail, as are the golden streets and gates of pearl.
  • Hebrews later also chose a king (despite the unanimous opposition of God’s prophets) and settled in cities, where they eventually founded the Lord’s Tabernacle and built a temple for Him. The city of Jerusalem later gained an illustrious position in all of religion.
  • this time Christianity (as well as the influence of the Greeks) does not consider human naturalness to be an unambiguous good, and it does not have such an idyllic relationship to nature as the Old Testament prophets.
  • If a tendency toward good is not naturally endowed in people, it must be imputed from above through violence or at least the threat of violence.
  • If we were to look at human naturalness as a good, then collective social actions need a much weaker ruling hand. If people themselves have a natural tendency (propensity) toward good, this role does not have to be supplied by the state, ruler, or, if you wish, Leviathan.
  • How does this affect economics?
  • us return for the last time to the humanization of the wild Enkidu, which is a process we can perceive with a bit of imagination as the first seed of the principle of the market’s invisible hand, and therefore the parallels with one of the central schematics of economic thinking.
  • Sometimes it is better to “harness the devil to the plow” than to fight with him. Instead of summoning up enormous energy in the fight against evil, it is better to use its own energy to reach a goal we desire; setting up a mill on the turbulent river instead of futile efforts to remove the current. This is also how Saint Prokop approached it in one of the oldest Czech legends.
  • Enkidu caused damage and it was impossible to fight against him. But with the help of a trap, trick, this evil was transformed into something that greatly benefited civilization.
  • By culturing and “domesticating” Enkidu, humanity tamed the uncontrollable wild and chaotic evil
  • Enkidu devastated the doings (the external, outside-the-walls) of the city. But he was later harnessed and fights at the side of civilization against nature, naturalness, the natural state of things.
  • A similar motif appears a thousand years after the reversal, which is well known even to noneconomists as the central idea of economics: the invisible hand of the market.
  • A similar story (reforming something animally wild and uncultivated in civilizational achievement) is used by Thomas Aquinas in his teachings. Several centuries later, this idea is fully emancipated in the hands of Bernard Mandeville and his Fable of the Bees: or, Private Vices, Publick Benefits. The economic and political aspects of this idea are—often incorrectly—ascribed to Adam Smith.
  • Here the individual does not try anymore to maximize his goods or profits, but what is important is writing his name in human memory in the form of heroic acts or deeds.
  • immortality, one connected with letters and the cult of the word: A name and especially a written name survives the body.”77
  • After this disappointment, he comes to the edge of the sea, where the innkeeper Siduri lives. As tonic for his sorrow, she offers him the garden of bliss, a sort of hedonistic fortress of carpe diem, where a person comes to terms with his mortality and at least in the course of the end of his life maximizes earthly pleasures, or earthly utility.
  • In the second stage, after finding his friend Enkidu, Gilgamesh abandons the wall and sets out beyond the city to maximalize heroism. “In his (…) search of immortal life, Gilgamesh
  • The hero refuses hedonism in the sense of maximizing terrestrial pleasure and throws himself into things that will exceed his life. In the blink of an eye, the epic turns on its head the entire utility maximization role that mainstream economics has tirelessly tried to sew on people as a part of their nature.81
  • It is simpler to observe the main features of our civilization at a time when the picture was more readable—at a time when our civilization was just being born and was still “half-naked.” In other words, we have tried to dig down to the bedrock of our written civilization;
  • today remember Gilgamesh for his story of heroic friendship with Enkidu, not for his wall, which no longer reaches monumental heights.
  • the eleventh and final tablet, Gilgamesh again loses what he sought. Like Sisyphus, he misses his goal just before the climax
  • is there something from it that is valid today? Have we found in Gilgamesh certain archetypes that are in us to this day?
  • The very existence of questions similar to today’s economic ones can be considered as the first observation. The first written considerations of the people of that time were not so different from those today. In other words: The epic is understandable for us, and we can identify with it.
  • We have also been witnesses to the very beginnings of man’s culturing—a great drama based on a liberation and then a distancing from the natural state.
  • Let us take this as a memento in the direction of our restlessness, our inherited dissatisfaction and the volatility connected to it. Considering that they have lasted five thousand years and to this day we find ourselves in harmony with a certain feeling of futility, perhaps these characteristics are inherent in man.
  • Gilgamesh had a wall built that divided the city from wild nature and created a space for the first human culture. Nevertheless, “not even far-reaching works of civilization could satisfy human desire.”
  • Friendship shows us new, unsuspected adventures, gives us the opportunity to leave the wall and to become neither its builder nor its part—to not be another brick in the wall.
  • with the phenomenon of the creation of the city, we have seen how specialization and the accumulation of wealth was born, how holy nature was transformed into a secular supplier of resources, and also how humans’ individualistic ego was emancipated.
  • to change the system, to break down that which is standing and go on an expedition against the gods (to awaken, from naïveté to awakening) requires friendship.
  • For small acts (hunting together, work in a factory), small love is enough: Camaraderie. For great acts, however, great love is necessary, real love: Friendship. Friendship that eludes the economic understanding of quid pro quo. Friendship gives. One friend gives (fully) for the other. That is friendship for life and death,
  • The thought that humanity comes at the expense of efficiency is just as old as humanity itself—as we have shown, subjects without emotion are the ideal of many tyrants.
  • The epic later crashes this idea through the friendship of Gilgamesh and Enkidu. Friendship—the biologically least essential love, which at first sight appears to be unnecessary
  • less a civilized, city person is dependent on nature, the more he or she is dependent on the rest of society. Like Enkidu, we have exchanged nature for society; harmony with (incalculable) nature for harmony with (incalculable) man.
  • human nature good or evil? To this day these questions are key for economic policy: If we believe that man is evil in his nature, therefore that a person himself is dog eat dog (animal), then the hard hand of a ruler is called for. If we believe that people in and of themselves, in their nature, gravitate toward good, then it is possible to loosen up the reins and live in a society that is more laissez-faire.
  • For a concept of historical progress, for the undeification of heroes, rulers, and nature, mankind had to wait for the Hebrews.
  • Because nature is not undeified, it is beyond consideration to explore it, let alone intervene in it (unless a person was a two-thirds god like Gilgamesh). It
  • They practiced money lending, traded in many assets (…) and especially were engaged in the trading of shares on capital markets, worked in currency exchange and frequently figured as mediators in financial transactions (…), they functioned as bankers and participated in emissions of all possible forms.
  • As regards modern capitalism (as opposed to the ancient and medieval periods) … there are activities in it which are, in certain forms, inherently (and completely necessarily) present—both from an economic and legal standpoint.7
  • As early as the “dark” ages, the Jews commonly used economic tools that were in many ways ahead of their time and that later became key elements of the modern economy:
  • Gilgamesh’s story ends where it began. There is a consistency in this with Greek myths and fables: At the end of the story, no progress occurs, no essential historic change; the story is set in indefinite time, something of a temporal limbo.
  • Jews believe in historical progress, and that progress is in this world.
  • For a nation originally based on nomadism, where did this Jewish business ethos come from? And can the Hebrews truly be considered as the architects of the values that set the direction of our civilization’s economic thought?
  • Hebrew religiosity is therefore strongly connected with this world, not with any abstract world, and those who take pleasure in worldly possessions are not a priori doing anything wrong.
  • PROGRESS: A SECULARIZED RELIGION One of the things the writers of the Old Testament gave to mankind is the idea and notion of progress. The Old Testament stories have their development; they change the history of the Jewish nation and tie in to each other. The Jewish understanding of time is linear—it has a beginning and an end.
  • The observance of God’s Commandments in Judaism leads not to some ethereal other world, but to an abundance of material goods (Genesis 49:25–26, Leviticus 26:3–13, Deuteronomy 28:1–13) (…) There are no accusing fingers pointed at
  • There are no echoes of asceticism nor for the cleansing and spiritual effect of poverty. It is fitting therefore, that the founders of Judaism, the Patriarchs Abraham, Isaac and Jacob, were all wealthy men.12
  • about due to a linear understanding of history. If history has a beginning as well as an end, and they are not the same point, then exploration suddenly makes sense in areas where the fruits are borne only in the next generation.
  • What’s more, economic progress has almost become an assumption of modern functional societies. We expect growth. We take it automatically. Today, if nothing “new” happens, if GDP does not grow (we say it stagnates) for several quarters, we consider it an anomaly.
  • however, the idea of progress itself underwent major changes, and today we perceive it very differently. As opposed to the original spiritual conceptions, today we perceive progress almost exclusively in an economic or scientific-technological sense.
  • Because care for the soul has today been replaced by care for external things,
  • This is why we must constantly grow, because we (deep down and often implicitly) believe that we are headed toward an (economic) paradise on Earth.
  • Only since the period of scientific-technological revolution (and at a time when economics was born as an independent field) is material progress automatically assumed.
  • Jewish thought is the most grounded, most realistic school of thought of all those that have influenced our culture.17 An abstract world of ideas was unknown to the Jews. To this day it is still forbidden to even depict God, people, and animals in symbols, paintings, statues, and drawings.
  • economists have become key figures of great importance in our time (Kacířské eseje o filosofii dějin [Heretical Essays in the Philosophy of History]). They are expected to perform interpretations of reality, give prophetic services (macroeconomic forecasts), reshape reality (mitigate the impacts of the crisis, speed up growth), and, in the long run, provide leadership on the way to the Promised Land—paradise on Earth.
  • REALISM AND ANTIASCETICISM Aside from ideas of progress, the Hebrews brought another very fundamental contribution to our culture: The desacralization of heroes, nature, and rulers.
  • Voltaire writes: “It certain fact is, that in his public laws he [Moses] never so much as once made mention of a life to come, limiting all punishments and all rewards to the present life.”21
  • As opposed to Christianity, the concept of an extraterrestrial paradise or heaven was not developed much in Hebrew thought.19 The paradise of the Israelites—Eden—was originally placed on Earth at a given place in Mesopotamia20 and at a given time,
  • The Hebrews consider the world to be real—not just a shadow reflection of a better world somewhere in the cloud of ideas, something the usual interpretation of history ascribes to Plato. The soul does not struggle against the body and is not its prisoner, as Augustine would write later.
  • The land, the world, the body, and material reality are for Jews the paramount setting for divine history, the pinnacle of creation. This idea is the conditio sine qua non of the development of economics, something of an utterly earthly making,
  • The mythology of the hero-king was strongly developed in that period, which Claire Lalouette summarizes into these basic characteristics: Beauty (a perfect face, on which it is “pleasant to look upon,” but also “beauty,” expressed in the Egyptian word nefer, not only means aesthetics, but contains moral qualities as well),
  • THE HERO AND HIS UNDEIFICATION: THE DREAM NEVER SLEEPS The concept of the hero is more important than it might appear. It may be the remote origin of Keynes’s animal spirits, or the desire to follow a kind of internal archetype that a given individual accepts as his own and that society values.
  • This internal animator of ours, our internal mover, this dream, never sleeps and it influences our behavior—including economic behavior—more than we want to realize.
  • manliness and strength,28 knowledge and intelligence,29 wisdom and understanding, vigilance and performance, fame and renown (fame which overcomes enemies because “a thousand men would not be able to stand firmly in his presence”);30 the hero is a good shepherd (who takes care of his subordinates), is a copper-clad rampart, the shield of the land, and the defender of heroes.
  • Each of us probably has a sort of “hero within”—a kind of internal role-model, template, an example that we (knowingly or not) follow. It is very important what kind of archetype it is, because its role is dominantly irrational and changes depending on time and the given civilization.
  • The oldest was the so-called Trickster—a fraudster; then the culture bearer—Rabbit; the musclebound hero called Redhorn; and finally the most developed form of hero: the Twins.
  • the Egyptian ruler, just as the Sumerian, was partly a god, or the son of a god.31
  • Jacob defrauds his father Isaac and steals his brother Esau’s blessing of the firstborn. Moses murders an Egyptian. King David seduces the wife of his military commander and then has him killed. In his old age, King Solomon turns to pagan idols, and so on.
  • Anthropology knows several archetypes of heroes. The Polish-born American anthropologist Paul Radin examined the myths of North American Indians and, for example, in his most influential book, The Trickster, he describes their four basic archetypes of heroes.
  • The Torah’s heroes (if that term can be used at all) frequently make mistakes and their mistakes are carefully recorded in the Bible—maybe precisely so that none of them could be deified.32
  • We do not have to go far for examples. Noah gets so drunk he becomes a disgrace; Lot lets his own daughters seduce him in a similar state of drunkenness. Abraham lies and (repeatedly) tries to sell his wife as a concubine.
  • the Hebrew heroes correspond most to the Tricksters, the Culture Bearers, and the Twins. The divine muscleman, that dominant symbol we think of when we say hero, is absent here.
  • To a certain extent it can be said that the Hebrews—and later Christianity—added another archetype, the archetype of the heroic Sufferer.35 Job
  • Undeification, however, does not mean a call to pillage or desecration; man was put here to take care of nature (see the story of the Garden of Eden or the symbolism of the naming of the animals). This protection and care of nature is also related to the idea of progress
  • For the heroes who moved our civilization to where it is today, the heroic archetypes of the cunning trickster, culture bearer, and sufferer are rather more appropriate.
  • the Old Testament strongly emphasizes the undeification of nature.37 Nature is God’s creation, which speaks of divinity but is not the domain of moody gods
  • This is very important for democratic capitalism, because the Jewish heroic archetype lays the groundwork much better for the development of the later phenomenon of the hero, which better suits life as we know it today. “The heroes laid down their arms and set about trading to become wealthy.”
  • in an Old Testament context, the pharaoh was a mere man (whom one could disagree with, and who could be resisted!).
  • RULERS ARE MERE MEN In a similar historical context, the Old Testament teachings carried out a similar desacralization of rulers, the so-called bearers of economic policy.
  • Ultimately the entire idea of a political ruler stood against the Lord’s will, which is explicitly presented in the Torah. The Lord unequivocally preferred the judge as the highest form of rule—an
  • The needs of future generations will have to be considered; after all humankind are the guardians of God’s world. Waste of natural resources, whether privately owned or nationally owned is forbidden.”39
  • Politics lost its character of divine infallibility, and political issues were subject to questioning. Economic policy could become a subject of examination.
  • 44 God first creates with the word and then on individual days He divides light from darkness, water from dry land, day from night, and so forth—and He gives order to things.45 The world is created orderly— it is wisely, reasonably put together. The way of the world is put together at least partially46 decipherably by any other wise and reasonable being who honors rational rules.
  • which for the methodology of science and economics is very important because disorder and chaos are difficult to examine scientifically.43 Faith in some kind of rational and logical order in a system (society, the economy) is a silent assumption of any (economic) examination.
  • THE PRAISE OF ORDER AND WISDOM: MAN AS A PERFECTER OF CREATION The created world has an order of sorts, an order recognizable by us as people,
  • From the very beginning, when God distances Himself from the entire idea, there is an anticipation that there is nothing holy, let alone divine, in politics. Rulers make mistakes, and it is possible to subject them to tough criticism—which frequently occurs indiscriminately through the prophets in the Old Testament.
  • Hebrew culture laid the foundations for the scientific examination of the world.
  • Examining the world is therefore an absolutely legitimate activity, and one that is even requested by God—it is a kind of participation in the Creator’s work.51 Man is called on to understand himself and his surroundings and to use his knowledge for good.
  • I was there when he set heavens in place, when he marked out the horizon on the face of the deep (…) Then I was the craftsman at his side.47
  • There are more urgings to gain wisdom in the Old Testament. “Wisdom calls aloud in the street (…): ‘How long will you simple ones love your simple ways?’”49 Or several chapters later: “Wisdom is supreme; therefore get wisdom. Though it cost all you have, get understanding.”50
  • examination is not forbidden. The fact that order can be grasped by human reason is another unspoken assumption that serves as a cornerstone of any scientific examination.
  • then, my sons, listen to me; blessed are those who keep my ways (…) Blessed is the man who listens to me, watching daily at my doors, waiting at my doorway. For whoever finds me finds life and receives favor from the Lord.
  • the rational examination of nature has its roots, surprisingly, in religion.
  • The Lord brought me forth as the first of his works, before his deeds of old. I was appointed from eternity, from the beginning, before the world began. When there were no oceans, I was given birth, when there were no springs abounding with water, before the mountains were settled in place,
  • The Book of Proverbs emphasizes specifically several times that it was wisdom that was present at the creation of the world. Wisdom personified calls out:
  • The last act, final stroke of the brush of creation, naming of the animals—this act is given to a human, it is not done by God, as one would expect. Man was given the task of completing the act of creation that the Lord began:
  • MAN AS A FINISHER OF CREATION The creation of the world, as it is explained in Jewish teachings, is described in the Book of Genesis. Here God (i) creates, (ii) separates, and (iii) names [my emphasis]:
  • Naming is a symbolic expression. In Jewish culture (and also in our culture to this day), the right to name meant sovereign rights and belonged, for example, to explorers (new places), inventors (new principles), or parents (children)—that is, to those who were there at the genesis, at the origin. This right was handed over by God to mankind.
  • The Naming itself (the capital N is appropriate) traditionally belongs to the crowning act of the Creator and represents a kind of grand finale of creation, the last move of the brush to complete the picture—a signature of the master.
  • Without naming, reality does not exist; it is created together with language. Wittgenstein tightly names this in his tractatus—the limits of our language are the limits of our world.53
  • He invented (fictitiously and completely abstractly!) a framework that was generally accepted and soon “made into” reality. Marx invented similarly; he created the notion of class exploitation. Through his idea, the perception of history and reality was changed for a large part of the world for nearly an entire century.
  • Reality is not a given; it is not passive. Perceiving reality and “facts” requires man’s active participation. It is man who must take the last step, an act (and we
  • How does this relate to economics? Reality itself, our “objective” world, is cocreated, man himself participates in the creation; creation, which is somewhat constantly being re-created.
  • Our scientific models put the finishing touches on reality, because (1) they interpret, (2) they give phenomena a name, (3) they enable us to classify the world and phenomena according to logical forms, and (4) through these models we de facto perceive reality.
  • When man finds a new linguistic framework or analytical model, or stops using the old one, he molds or remolds reality. Models are only in our heads; they are not “in objective reality.” In this sense, Newton invented (not merely discovered!) gravity.
  • A real-ization act on our part represents the creation of a construct, the imputation of sense and order (which is beautifully expressed by the biblical act of naming, or categorization, sorting, ordering).
  • Keynes enters into the history of economic thought from the same intellectual cadence; his greatest contribution to economics was precisely the resurrection of the imperceptible—for example in the form of animal spirits or uncertainty. The economist Piero Mini even ascribes Keynes’s doubting and rebellious approach to his almost Talmudic education.63
  • God connects man with the task of guarding and protecting the Garden of Eden, and thus man actually cocreates the cultural landscape. The Czech philosopher Zdeněk Neubauer also describes this: “Such is reality, and it is so deep that it willingly crystallizes into worlds. Therefore I profess that reality is a creation and not a place of occurrence for objectively given phenomena.”61
  • in this viewpoint it is possible to see how Jewish thought is mystical—it admits the role of the incomprehensible. Therefore, through its groundedness, Jewish thought indulges mystery and defends itself against a mechanistic-causal explanation of the world: “The Jewish way of thinking, according to Veblen, emphasizes the spiritual, the miraculous, the intangible.
  • The Jews believed the exact opposite. The world is created by a good God, and evil appears in it as a result of immoral human acts. Evil, therefore, is induced by man.66 History unwinds according to the morality of human acts.
  • What’s more, history seems to be based on morals; morals seem to be the key determining factors of history. For the Hebrews, history proceeds according to how morally its actors behave.
  • The Sumerians believed in dualism—good and evil deities exist, and the earth of people becomes their passive battlefield.
  • GOOD AND EVIL IN US: A MORAL EXPLANATION OF WELL-BEING We have seen that in the Epic of Gilgamesh, good and evil are not yet addressed systematically on a moral level.
  • This was not about moral-human evil, but rather a kind of natural evil. It is as if good and evil were not touched by morality at all. Evil simply occurred. Period.
  • the epic, good and evil are not envisaged morally—they are not the result of an (a)moral act. Evil was not associated with free moral action or individual will.
  • Hebrew thought, on the other hand, deals intensively with moral good and evil. A moral dimension touches the core of its stories.65
  • discrepancy between savings and investment, and others are convinced of the monetary essence
  • The entire history of the Jewish nation is interpreted and perceived in terms of morality. Morality has become, so to speak, a mover and shaker of Hebrew history.
  • sunspots. The Hebrews came up with the idea that morals were behind good and bad years, behind the economic cycle. But we would be getting ahead of ourselves. Pharaoh’s Dream: Joseph and the First Business Cycle To
  • It is the Pharaoh’s well-known dream of seven fat and seven lean cows, which he told to Joseph, the son of Jacob. Joseph interpreted the dream as a macroeconomic prediction of sorts: Seven years of abundance were to be followed by seven years of poverty, famine, and misery.
  • Self-Contradicting Prophecy Here, let’s make several observations on this: Through taxation74 on the level of one-fifth of a crop75 in good years to save the crop and then open granaries in bad years, the prophecy was de facto prevented (prosperous years were limited and hunger averted—through a predecessor of fiscal stabilization).
  • The Old Testament prophesies therefore were not any deterministic look into the future, but warnings and strategic variations of the possible, which demanded some kind of reaction. If the reaction was adequate, what was prophesied would frequently not occur at all.
  • This principle stands directly against the self-fulfilling prophecy,80 the well-known concept of social science. Certain prophecies become self-fulfilling when expressed (and believed) while others become self-contradicting prophecies when pronounced (and believed).
  • If the threat is anticipated, it is possible to totally or at least partially avoid it. Neither Joseph nor the pharaoh had the power to avoid bounty or crop failure (in this the dream interpretation was true and the appearance of the future mystical), but they avoided the impacts and implications of the prophecy (in this the interpretation of the dream was “false”)—famine did not ultimately occur in Egypt, and this was due to the application of reasonable and very intuitive economic policy.
  • Let us further note that the first “macroeconomic forecast” appears in a dream.
  • back to Torah: Later in this story we will notice that there is no reason offered as to why the cycle occurs (that will come later). Fat years will simply come, and then lean years after them.
  • Moral Explanation of a Business Cycle That is fundamentally different from later Hebrew interpretations, when the Jewish nation tries to offer reasons why the nation fared well or poorly. And those reasons are moral.
  • If you pay attention to these laws and are careful to follow them, then the Lord your God will keep his covenant of love with you, as he swore to your forefathers. He will love you and bless you and increase your numbers.
  • Only in recent times have some currents of economics again become aware of the importance of morals and trust in the form of measuring the quality of institutions, the level of justice, business ethics, corruption, and so forth, and examining their influence on the economy,
  • From today’s perspective, we can state that the moral dimension entirely disappeared from economic thought for a long time, especially due to the implementation of Mandeville’s concept of private vices that contrarily support the public welfare
  • Without being timid, we can say this is the first documented attempt to explain the economic cycle. The economic cycle, the explanation of which is to this day a mystery to economists, is explained morally in the Old Testament.
  • But how do we consolidate these two conflicting interpretations of the economic cycle: Can ethics be responsible for it or not? Can we influence reality around us through our acts?
  • it is not within the scope of this book to answer that question; justice has been done to the question if it manages to sketch out the main contours of possible searches for answers.
  • THE ECONOMICS OF GOOD AND EVIL: DOES GOOD PAY OFF? This is probably the most difficult moral problem we could ask.
  • Kant, the most important modern thinker in the area of ethics, answers on the contrary that if we carry out a “moral” act on the basis of economic calculus (therefore we carry out an hedonistic consideration; see below) in the expectation of later recompense, its morality is lost. Recompense, according to the strict Kant, annuls ethics.
  • Inquiring about the economics of good and evil, however, is not that easy. Where would Kant’s “moral dimension of ethics” go if ethics paid? If we do good for profit, the question of ethics becomes a mere question of rationality.
  • Job’s friends try to show that he must have sinned in some way and, in doing so, deserved God’s punishment. They are absolutely unable to imagine a situation in which Job, as a righteous man, would suffer without (moral) cause. Nevertheless, Job insists that he deserves no punishment because he has committed no offense: “God has wronged me and drawn his net around me.”94
  • But Job remains righteous, even though it does not pay to do so: Though he slay me, yet will I hope in him.95 And till I die, I will not deny my integrity I will maintain my righteousness and never let go of it; my conscience will not reproach me as long as I live.96
  • He remains righteous, even if his only reward is death. What economic advantage could he have from that?
  • morals cannot be considered in the economic dimension of productivity and calculus. The role of the Hebrews was to do good, whether it paid off or not. If good (outgoing) is rewarded by incoming goodness, it is a bonus,99 not a reason to do outgoing good. Good and reward do not correlate to each other.
  • This reasoning takes on a dimension of its own in the Old Testament. Good (incoming) has already happened to us. We must do good (outgoing) out of gratitude for the good (incoming) shown to us in the past.
  • So why do good? After all, suffering is the fate of many biblical figures. The answer can only be: For good itself. Good has the power to be its own reward. In this sense, goodness gets its reward, which may or may not take on a material dimension.
  • the Hebrews offered an interesting compromise between the teachings of the Stoics and Epicureans. We will go into it in detail later, so only briefly
  • constraint. It calls for bounded optimalization (with limits). A kind of symbiosis existed between the legitimate search for one’s own utility (or enjoyment of life) and maintaining rules, which are not negotiable and which are not subject to optimalization.
  • In other words, clear (exogenously given) rules exist that must be observed and cannot be contravened. But within these borders it is absolutely possible, and even recommended, to increase utility.
  • the mining of enjoyment must not come at the expense of exogenously given rules. “Judaism comes therefore to train or educate the unbounded desire … for wealth, so that market activities and patterns of consumption operate within a God-given morality.”102
  • The Epicureans acted with the goal of maximizing utility without regard for rules (rules developed endogenously, from within the system, computed from that which increased utility—this was one of the main trumps of the Epicurean school; they did not need exogenously given norms, and argued that they could “calculate” ethics (what to do) for every given situation from the situation itself).
  • The Stoics could not seek their enjoyment—or, by another name, utility. They could not in any way look back on it, and in no way could they count on it. They could only live according to rules (the greatest weakness of this school was to defend where exogenously the given rules came from and whether they are universal) and take a indifferent stand to the results of their actions.
  • To Love the Law The Jews not only had to observe the law (perhaps the word covenant would be more appropriate), but they were to love it because it was good.
  • Their relationship to the law was not supposed to be one of duty,105 but one of gratitude, love. Hebrews were to do good (outgoing), because goodness (incoming) has already been done to them.
  • This is in stark contrast with today’s legal system, where, naturally, no mention of love or gratefulness exists. But God expects a full internalization of the commandments and their fulfillment with love, not as much duty. By no means was this on the basis of the cost-benefit analyses so widespread in economics today, which determines when it pays to break the law and when not to (calculated on the basis of probability of being caught and the amount of punishment vis-à-vis the possible gain).
  • And now, O Israel, what does the Lord your God ask of you but to fear the Lord your God, to walk in all his ways, to love him, to serve the Lord your God with all your heart and with all your soul, and to observe the Lord’s commands and decrees that I am giving you today for your own good? To the Lord your God belong the heavens, even the highest heavens, the earth and everything in it. Yet the Lord set his affection on your forefathers and loved them….
  • the principle of doing good (outgoing) on the basis of a priori demonstrated good (incoming) was also taken over by the New Testament. Atonement itself is based on an a priori principle; all our acts are preceded by good.
  • The Hebrews, originally a nomadic tribe, preferred to be unrestrained and grew up in constant freedom of motion.
  • Human laws, if they are in conflict with the responsibilities given by God, are subordinate to personal responsibility, and a Jew cannot simply join the majority, even if it is legally allowed. Ethics, the concept of good, is therefore always superior to all local laws, rules, and customs:
  • THE SHACKLES OF THE CITY Owing to the Hebrew’s liberation from Egyptian slavery, freedom and responsibility become the key values of Jewish thought.
  • Laws given by God are binding for Jews, and God is the absolute source of all values,
  • The Hebrew ideal is represented by the paradise of the Garden of Eden, not a city.116 The despised city civilization or the tendency to see in it a sinful and shackling way of life appears in glimpses and allusions in many places in the Old Testament.
  • The nomadic Jewish ethos is frequently derived from Abraham, who left the Chaldean city of Ur on the basis of a command:
  • In addition, they were aware of a thin two-way line between owner and owned. We own material assets, but—to a certain extent—they own us and tie us down. Once we become used to a certain material
  • This way of life had understandably immense economic impacts. First, such a society lived in much more connected relationships, where there was no doubt that everyone mutually depended on each other. Second, their frequent wanderings meant the inability to own more than they could carry; the gathering up of material assets did not have great weight—precisely because the physical weight (mass) of things was tied to one place.
  • One of Moses’s greatest deeds was that he managed to explain to his nation once and for all that it is better to remain hungry and liberated than to be a slave with food “at no cost.”
  • SOCIAL WELFARE: NOT TO ACT IN THE MANNER OF SODOM
  • regulations is developed in the Old Testament, one we hardly find in any other nation of the time. In Hebrew teachings, aside from individual utility, indications of the concept of maximalizing utility societywide appear for the first time as embodied in the Talmudic principle of Kofin al midat S´dom, which can be translated as “one is compelled not to act in the manner of Sodom” and to take care of the weaker members of society.
  • In a jubilee year, debts were to be forgiven,125 and Israelites who fell into slavery due to their indebtedness were to be set free.126
  • Such provisions can be seen as the antimonopoly and social measures of the time. The economic system even then had a clear tendency to converge toward asset concentration, and therefore power as well. It would appear that these provisions were supposed to prevent this process
  • Land at the time could be “sold,” and it was not sale, but rent. The price (rent) of real estate depended on how long there was until a forgiveness year. It was about the awareness that we may work the land, but in the last instance we are merely “aliens and strangers,” who have the land only rented to us for a fixed time. All land and riches came from the Lord.
  • These provisions express a conviction that freedom and inheritance should not be permanently taken away from any Israelite. Last but not least, this system reminds us that no ownership lasts forever and that the fields we plow are not ours but the Lord’s.
  • Glean Another social provision was the right to glean, which in Old Testament times ensured at least basic sustenance for the poorest. Anyone who owned a field had the responsibility not to harvest it to the last grain but to leave the remains in the field for the poor.
  • Tithes and Early Social Net Every Israelite also had the responsibility of levying a tithe from their entire crop. They had to be aware from whom all ownership comes and, by doing so, express their thanks.
  • “Since the community has an obligation to provide food, shelter, and basic economic goods for the needy, it has a moral right and duty to tax its members for this purpose. In line with this duty, it may have to regulate markets, prices and competition, to protect the interests of its weakest members.”135
  • In Judaism, charity is not perceived as a sign of goodness; it is more of a responsibility. Such a society then has the right to regulate its economy in such a way that the responsibility of charity is carried out to its satisfaction.
  • With a number of responsibilities, however, comes the difficulty of getting them into practice. Their fulfillment, then, in cases when it can be done, takes place gradually “in layers.” Charitable activities are classified in the Talmud according to several target groups with various priorities, classified according to, it could be said, rules of subsidiarity.
  • Do not mistreat an alien or oppress him, for you were aliens in Egypt.140 As one can see, aside from widows and orphans, the Old Testament also includes immigrants in its area of social protection.141 The Israelites had to have the same rules apply for them as for themselves—they could not discriminate on the basis of their origin.
  • ABSTRACT MONEY, FORBIDDEN INTEREST, AND OUR DEBT AGE If it appears to us that today’s era is based on money and debt, and our time will be written into history as the “Debt age,” then it will certainly be interesting to follow how this development occurred.
  • Money is a social abstractum. It is a social agreement, an unwritten contract.
  • The first money came in the form of clay tablets from Mesopotamia, on which debts were written. These debts were transferable, so the debts became currency. In the end, “It is no coincidence that in English the root of ‘credit’ is ‘credo,’ the Latin for ‘I believe.’”
  • To a certain extent it could be said that credit, or trust, was the first currency. It can materialize, it can be embodied in coins, but what is certain is that “money is not metal,” even the rarest metal, “it is trust inscribed,”
  • Inseparably, with the original credit (money) goes interest. For the Hebrews, the problem of interest was a social issue: “If you lend money to one of my people among you who is needy, do not be like a moneylender; charge him no interest.”
  • there were also clearly set rules setting how far one could go in setting guarantees and the nonpayment of debts. No one should become indebted to the extent that they could lose the source of their livelihood:
  • In the end, the term “bank” comes from the Italian banci, or the benches that Jewish lenders sat on.157
  • Money is playing not only its classical roles (as a means of exchange, a holder of value, etc.) but also a much greater, stronger role: It can stimulate, drive (or slow down) the whole economy. Money plays a national economic role.
  • In the course of history, however, the role of loans changed, and the rich borrowed especially for investment purposes,
  • Today the position and significance of money and debt has gone so far and reached such a dominant position in society that operating with debts (fiscal policy) or interest or money supply (monetary policy) means that these can, to a certain extent, direct (or at least strongly influence) the whole economy and society.
  • In such a case a ban on interest did not have great ethical significance. Thomas Aquinas, a medieval scholar (1225-1274), also considers similarly; in his time, the strict ban on lending with usurious interest was loosened, possibly due to him.
  • As a form of energy, money can travel in three dimensions, vertically (those who have capital lend to those who do not) and horizontally (speed and freedom in horizontal or geographic motion has become the by-product—or driving force?—of globalization). But money (as opposed to people) can also travel through time.
  • money is something like energy that can travel through time. And it is a very useful energy, but at the same time very dangerous as well. Wherever
  • Aristotle condemned interest162 not only from a moral standpoint, but also for metaphysical reasons. Thomas Aquinas shared the same fear of interest and he too argued that time does not belong to us, and that is why we must not require interest.
  • MONEY AS ENERGY: TIME TRAVEL AND GROSS DEBT PRODUCT (GDP)
  • Due to this characteristic, we can energy-strip the future to the benefit of the present. Debt can transfer energy from the future to the present.163 On the other hand, saving can accumulate energy from the past and send it to the present.
  • labor was not considered degrading in the Old Testament. On the contrary, the subjugation of nature is even a mission from God that originally belonged to man’s very first blessings.
  • LABOR AND REST: THE SABBATH ECONOMY
  • The Jews as well as Aristotle behaved very guardedly toward loans. The issue of interest/usury became one of the first economic debates. Without having an inkling of the future role of economic policy (fiscal and monetary), the ancient Hebrews may have unwittingly felt that they were discovering in interest a very powerful weapon, one that can be a good servant, but (literally) an enslaving master as well.
  • It’s something like a dam. When we build one, we are preventing periods of drought and flooding in the valley; we are limiting nature’s whims and, to a large extent, avoiding its incalculable cycles. Using dams, we can regulate the flow of water to nearly a constant. With it we tame the river (and we can also gain
  • But if we do not regulate the water wisely, it may happen that we would overfill the dam and it would break. For the cities lying in the valley, their end would be worse than if a dam were never there.
  • If man lived in harmony with nature before, now, after the fall, he must fight; nature stands against him and he against it and the animals. From the Garden we have moved unto a (battle)field.
  • Only after man’s fall does labor turn into a curse.168 It could even be said that this is actually the only curse, the curse of the unpleasantness of labor, that the Lord places on Adam.
  • Both Plato and Aristotle consider labor to be necessary for survival, but that only the lower classes should devote themselves to it so that the elites would not have to be bothered with it and so that they could devote themselves to “purely spiritual matters—art, philosophy, and politics.”
  • Work is also not only a source of pleasure but a social standing; It is considered an honor. “Do you see a man skilled in his work? He will serve before kings.”170 None of the surrounding cultures appreciate work as much. The idea of the dignity of labor is unique in the Hebrew tradition.
  • Hebrew thinking is characterized by a strict separation of the sacred from the profane. In life, there are simply areas that are holy, and in which it is not allowed to economize, rationalize, or maximize efficiency.
  • good example is the commandment on the Sabbath. No one at all could work on this day, not even the ones who were subordinate to an observant Jew:
  • the message of the commandment on Saturday communicated that people were not primarily created for labor.
  • Paradoxically, it is precisely this commandment out of all ten that is probably the most violated today.
  • Aristotle even considers labor to be “a corrupted waste of time which only burdens people’s path to true honour.”
  • we have days when we must not toil connected (at least lexically) with the word meaning emptiness: the English term “vacation” (or emptying), as with the French term, les vacances, or German die Freizeit, meaning open time, free time, but also…
  • Translated into economic language: The meaning of utility is not to increase it permanently but to rest among existing gains. Why do we learn how to constantly increase gains but not how to…
  • This dimension has disappeared from today’s economics. Economic effort has no goal at which it would be possible to rest. Today we only know growth for growth’s sake, and if our company or country prospers, that does not…
  • Six-sevenths of time either be dissatisfied and reshape the world into your own image, man, but one-seventh you will rest and not change the creation. On the seventh day, enjoy creation and enjoy the work of your hands.
  • the purpose of creation was not just creating but that it had an end, a goal. The process was just a process, not a purpose. The whole of Being was created so…
  • Saturday was not established to increase efficiency. It was a real ontological break that followed the example of the Lord’s seventh day of creation. Just as the Lord did not rest due to tiredness or to regenerate strength; but because He was done. He was done with His work, so that He could enjoy it, to cherish in His creation.
  • If we believe in rest at all today, it is for different reasons. It is the rest of the exhausted machine, the rest of the weak, and the rest of those who can’t handle the tempo. It’s no wonder that the word “rest…
  • Related to this, we have studied the first mention of a business cycle with the pharaoh’s dream as well as seen a first attempt (that we may call…
  • We have tried to show that the quest for a heaven on Earth (similar to the Jewish one) has, in its desacralized form, actually also been the same quest for many of the…
  • We have also seen that the Hebrews tried to explain the business cycle with morality and ethics. For the Hebrews,…
  • ancient Greek economic ethos, we will examine two extreme approaches to laws and rules. While the Stoics considered laws to be absolutely valid, and utility had infinitesimal meaning in their philosophy, the Epicureans, at least in the usual historical explanation, placed utility and pleasure in first place—rules were to be made based on the principle of utility.
  • CONCLUSION: BETWEEN UTILITY AND PRINCIPLE The influence of Jewish thought on the development of market democracy cannot be overestimated. The key heritage for us was the lack of ascetic perception of the world, respect to law and private…
  • We have tried to show how the Torah desacralized three important areas in our lives: the earthly ruler, nature,…
  • What is the relationship between the good and evil that we do (outgoing) and the utility of disutility that we (expect to) get as a reward (incoming)? We have seen…
  • The Hebrews never despised material wealth; on contrary, the Jewish faith puts great responsibility on property management. Also the idea of progress and the linear perception of time gives our (economic)…
  • the Hebrews managed to find something of a happy compromise between both of these principles.
  • will not be able to completely understand the development of the modern notion of economics without understanding the disputes between the Epicureans and the Stoics;
  • poets actually went even further, and with their speech they shaped and established reality and truth. Honor, adventure, great deeds, and the acclaim connected with them played an important role in the establishment of the true, the real.
  • those who are famous will be remembered by people. They become more real, part of the story, and they start to be “realized,” “made real” in the lives of other people. That which is stored in memory is real; that which is forgotten is as if it never existed.
  • Today’s scientific truth is founded on the notion of exact and objective facts, but poetic truth stands on an interior (emotional) consonance with the story or poem. “It is not addressed first to the brain … [myth] talks directly to the feeling system.”
  • “epic and tragic poets were widely assumed to be the central ethical thinkers and teachers of Greece; nobody thought of their work as less serious, less aimed at truth, than the speculative prose treatises of historians and philosophers.”5 Truth and reality were hidden in speech, stories, and narration.
  • Ancient philosophy, just as science would later, tries to find constancy, constants, quantities, inalterabilities. Science seeks (creates?) order and neglects everything else as much as it can. In their own experiences, everyone knows that life is not like that,
  • Just as scientists do today, artists drew images of the world that were representative, and therefore symbolic, picturelike, and simplifying (but thus also misleading), just like scientific models, which often do not strive to be “realistic.”
  • general? In the end, poetry could be more sensitive to the truth than the philosophical method or, later, the scientific method. “Tragic poems, in virtue of their subject matter and their social function, are likely to confront and explore problems about human beings and luck that a philosophical text might be able to omit or avoid.”8
Javier E

The Irrational Consumer: Why Economics Is Dead Wrong About How We Make Choices - Derek ... - 4 views

www.theatlantic.com/...267255

rational choice rationality psychology consumer economics

shared by Javier E on 20 May 15 - No Cached
  • Atlantic.displayRandomElement('#header li.business .sponsored-dropdown-item'); Derek Thompson - Derek Thompson is a senior editor at The Atlantic, where he oversees business coverage for the website. More Derek has also written for Slate, BusinessWeek, and the Daily Beast. He has appeared as a guest on radio and television networks, including NPR, the BBC, CNBC, and MSNBC. All Posts RSS feed Share Share on facebook Share on linkedin Share on twitter « Previous Thompson Email Print Close function plusOneCallback () { $(document).trigger('share'); } $(document).ready(function() { var iframeUrl = "\/ad\/thanks-iframe\/TheAtlanticOnline\/channel_business;src=blog;by=derek-thompson;title=the-irrational-consumer-why-economics-is-dead-wrong-about-how-we-make-choices;pos=sharing;sz=640x480,336x280,300x250"; var toolsClicked = false; $('#toolsTop').click(function() { toolsClicked = 'top'; }); $('#toolsBottom').click(function() { toolsClicked = 'bottom'; }); $('#thanksForSharing a.hide').click(function() { $('#thanksForSharing').hide(); }); var onShareClickHandler = function() { var top = parseInt($(this).css('top').replace(/px/, ''), 10); toolsClicked = (top > 600) ? 'bottom' : 'top'; }; var onIframeReady = function(iframe) { var win = iframe.contentWindow; // Don't show the box if there's no ad in it if (win.$('.ad').children().length == 1) { return; } var visibleAds = win.$('.ad').filter(function() { return !($(this).css('display') == 'none'); }); if (visibleAds.length == 0) { // Ad is hidden, so don't show return; } if (win.$('.ad').hasClass('adNotLoaded')) { // Ad failed to load so don't show return; } $('#thanksForSharing').css('display', 'block'); var top; if(toolsClicked == 'bottom' && $('#toolsBottom').length) { top = $('#toolsBottom')[0].offsetTop + $('#toolsBottom').height() - 310; } else { top = $('#toolsTop')[0].offsetTop + $('#toolsTop').height() + 10; } $('#thanksForSharing').css('left', (-$('#toolsTop').offset().left + 60) + 'px'); $('#thanksForSharing').css('top', top + 'px'); }; var onShare = function() { // Close "Share successful!" AddThis plugin popup if (window._atw && window._atw.clb && $('#at15s:visible').length) { _atw.clb(); } if (iframeUrl == null) { return; } $('#thanksForSharingIframe').attr('src', "\/ad\/thanks-iframe\/TheAtlanticOnline\/channel_business;src=blog;by=derek-thompson;title=the-irrational-consumer-why-economics-is-dead-wrong-about-how-we-make-choices;pos=sharing;sz=640x480,336x280,300x250"); $('#thanksForSharingIframe').load(function() { var iframe = this; var win = iframe.contentWindow; if (win.loaded) { onIframeReady(iframe); } else { win.$(iframe.contentDocument).ready(function() { onIframeReady(iframe); }) } }); }; if (window.addthis) { addthis.addEventListener('addthis.ready', function() { $('.articleTools .share').mouseover(function() { $('#at15s').unbind('click', onShareClickHandler); $('#at15s').bind('click', onShareClickHandler); }); }); addthis.addEventListener('addthis.menu.share', function(evt) { onShare(); }); } // This 'share' event is used for testing, so one can call // $(document).trigger('share') to get the thank you for // sharing box to appear. $(document).bind('share', function(event) { onShare(); }); if (!window.FB || (window.FB && !window.FB._apiKey)) { // Hook into the fbAsyncInit function and register our listener there var oldFbAsyncInit = (window.fbAsyncInit) ? window.fbAsyncInit : (function() { }); window.fbAsyncInit = function() { oldFbAsyncInit(); FB.Event.subscribe('edge.create', function(response) { // to hide the facebook comments box $('#facebookLike span.fb_edge_comment_widget').hide(); onShare(); }); }; } else if (window.FB) { FB.Event.subscribe('edge.create', function(response) { // to hide the facebook comments box $('#facebookLike span.fb_edge_comment_widget').hide(); onShare(); }); } }); The Irrational Consumer: Why Economics Is Dead Wrong About How We Make Choices By Derek Thompson he
  • First, making a choice is physically exhausting, literally, so that somebody forced to make a number of decisions in a row is likely to get lazy and dumb.
  • Second, having too many choices can make us less likely to come to a conclusion. In a famous study of the so-called "paradox of choice", psychologists Mark Lepper and Sheena Iyengar found that customers presented with six jam varieties were more likely to buy one than customers offered a choice of 24.
  • ...7 more annotations...
  • Many of our mistakes stem from a central "availability bias." Our brains are computers, and we like to access recently opened files, even though many decisions require a deep body of information that might require some searching. Cheap example: We remember the first, last, and peak moments of certain experiences.
  • The third check against the theory of the rational consumer is the fact that we're social animals. We let our friends and family and tribes do our thinking for us
  • neurologists are finding that many of the biases behavioral economists perceive in decision-making start in our brains. "Brain studies indicate that organisms seem to be on a hedonic treadmill, quickly habituating to homeostasis," McFadden writes. In other words, perhaps our preference for the status quo isn't just figuratively our heads, but also literally sculpted by the hand of evolution inside of our brains.
  • The popular psychological theory of "hyperbolic discounting" says people don't properly evaluate rewards over time. The theory seeks to explain why many groups -- nappers, procrastinators, Congress -- take rewards now and pain later, over and over again. But neurology suggests that it hardly makes sense to speak of "the brain," in the singular, because it's two very different parts of the brain that process choices for now and later. The choice to delay gratification is mostly processed in the frontal system. But studies show that the choice to do something immediately gratifying is processed in a different system, the limbic system, which is more viscerally connected to our behavior, our "reward pathways," and our feelings of pain and pleasure.
  • the final message is that neither the physiology of pleasure nor the methods we use to make choices are as simple or as single-minded as the classical economists thought. A lot of behavior is consistent with pursuit of self-interest, but in novel or ambiguous decision-making environments there is a good chance that our habits will fail us and inconsistencies in the way we process information will undo us.
  • Our brains seem to operate like committees, assigning some tasks to the limbic system, others to the frontal system. The "switchboard" does not seem to achieve complete, consistent communication between different parts of the brain. Pleasure and pain are experienced in the limbic system, but not on one fixed "utility" or "self-interest" scale. Pleasure and pain have distinct neural pathways, and these pathways adapt quickly to homeostasis, with sensation coming from changes rather than levels
  • Social networks are sources of information, on what products are available, what their features are, and how your friends like them. If the information is accurate, this should help you make better choices. On the other hand, it also makes it easier for you to follow the crowd rather than engaging in the due diligence of collecting and evaluating your own information and playing it against your own preferences
Javier E

The Chatbots Are Here, and the Internet Industry Is in a Tizzy - The New York Times - 0 views

www.nytimes.com/...disrupt-internet-industry.html

chatbot AI industry effects business internet companies technology

shared by Javier E on 10 Mar 23 - No Cached
  • He cleared his calendar and asked employees to figure out how the technology, which instantly provides comprehensive answers to complex questions, could benefit Box, a cloud computing company that sells services that help businesses manage their online data.
  • Mr. Levie’s reaction to ChatGPT was typical of the anxiety — and excitement — over Silicon Valley’s new new thing. Chatbots have ignited a scramble to determine whether their technology could upend the economics of the internet, turn today’s powerhouses into has-beens or create the industry’s next giants.
  • Cloud computing companies are rushing to deliver chatbot tools, even as they worry that the technology will gut other parts of their businesses. E-commerce outfits are dreaming of new ways to sell things. Social media platforms are being flooded with posts written by bots. And publishing companies are fretting that even more dollars will be squeezed out of digital advertising.
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  • The volatility of chatbots has made it impossible to predict their impact. In one second, the systems impress by fielding a complex request for a five-day itinerary, making Google’s search engine look archaic. A moment later, they disturb by taking conversations in dark directions and launching verbal assaults.
  • The result is an industry gripped with the question: What do we do now?
  • The A.I. systems could disrupt $100 billion in cloud spending, $500 billion in digital advertising and $5.4 trillion in e-commerce sales,
  • As Microsoft figures out a chatbot business model, it is forging ahead with plans to sell the technology to others. It charges $10 a month for a cloud service, built in conjunction with the OpenAI lab, that provides developers with coding suggestions, among other things.
  • Smaller companies like Box need help building chatbot tools, so they are turning to the giants that process, store and manage information across the web. Those companies — Google, Microsoft and Amazon — are in a race to provide businesses with the software and substantial computing power behind their A.I. chatbots.
  • “The cloud computing providers have gone all in on A.I. over the last few months,
  • “They are realizing that in a few years, most of the spending will be on A.I., so it is important for them to make big bets.”
  • Yusuf Mehdi, the head of Bing, said the company was wrestling with how the new version would make money. Advertising will be a major driver, he said, but the company expects fewer ads than traditional search allows.
  • Google, perhaps more than any other company, has reason to both love and hate the chatbots. It has declared a “code red” because their abilities could be a blow to its $162 billion business showing ads on searches.
  • “The discourse on A.I. is rather narrow and focused on text and the chat experience,” Mr. Taylor said. “Our vision for search is about understanding information and all its forms: language, images, video, navigating the real world.”
  • Sridhar Ramaswamy, who led Google’s advertising division from 2013 to 2018, said Microsoft and Google recognized that their current search business might not survive. “The wall of ads and sea of blue links is a thing of the past,” said Mr. Ramaswamy, who now runs Neeva, a subscription-based search engine.
  • As that underlying tech, known as generative A.I., becomes more widely available, it could fuel new ideas in e-commerce. Late last year, Manish Chandra, the chief executive of Poshmark, a popular online secondhand store, found himself daydreaming during a long flight from India about chatbots building profiles of people’s tastes, then recommending and buying clothes or electronics. He imagined grocers instantly fulfilling orders for a recipe.
  • “It becomes your mini-Amazon,” said Mr. Chandra, who has made integrating generative A.I. into Poshmark one of the company’s top priorities over the next three years. “That layer is going to be very powerful and disruptive and start almost a new layer of retail.”
  • In early December, users of Stack Overflow, a popular social network for computer programmers, began posting substandard coding advice written by ChatGPT. Moderators quickly banned A.I.-generated text
  • t people could post this questionable content far faster than they could write posts on their own, said Dennis Soemers, a moderator for the site. “Content generated by ChatGPT looks trustworthy and professional, but often isn’t,”
  • When websites thrived during the pandemic as traffic from Google surged, Nilay Patel, editor in chief of The Verge, a tech news site, warned publishers that the search giant would one day turn off the spigot. He had seen Facebook stop linking out to websites and foresaw Google following suit in a bid to boost its own business.
  • He predicted that visitors from Google would drop from a third of websites’ traffic to nothing. He called that day “Google zero.”
  • Because chatbots replace website search links with footnotes to answers, he said, many publishers are now asking if his prophecy is coming true.
  • , strategists and engineers at the digital advertising company CafeMedia have met twice a week to contemplate a future where A.I. chatbots replace search engines and squeeze web traffic.
  • The group recently discussed what websites should do if chatbots lift information but send fewer visitors. One possible solution would be to encourage CafeMedia’s network of 4,200 websites to insert code that limited A.I. companies from taking content, a practice currently allowed because it contributes to search rankings.
  • Courts are expected to be the ultimate arbiter of content ownership. Last month, Getty Images sued Stability AI, the start-up behind the art generator tool Stable Diffusion, accusing it of unlawfully copying millions of images. The Wall Street Journal has said using its articles to train an A.I. system requires a license.
  • In the meantime, A.I. companies continue collecting information across the web under the “fair use” doctrine, which permits limited use of material without permission.
katherineharron

How small business owners may benefit from the $2 trillion federal aid package - CNN - 0 views

www.cnn.com/...index.html

shared by katherineharron on 27 Mar 20 - No Cached
  • The $2 trillion economic aid package unveiled Wednesday contains several provisions to help small businesses in the wake of the coronavirus pandemic
  • The provisions are also unlikely to save those small businesses that will have to come up with cash to stay afloat until they can actually get the government's aid money in hand.
  • An emergency grant of up to $10,000: Small businesses may apply directly to the federal Small Business Administration to receive an economic injury disaster grant of up to $10,000 that does not need to be paid back. The money would be paid out to business owners within three days of their application's submission. It can be used to maintain payroll, cover paid sick leave and service other debt obligations.
Javier E

Against the Odds, Starting a Tech Business in France - NYTimes.com - 0 views

www.nytimes.com/...a-tech-business-in-france.html

france entrepreneur business

shared by Javier E on 05 Feb 13 - No Cached
  • France’s business ecosystem thrives on contradictions — the country has some of the highest labor costs in Europe and restrictive regulations, and yet its companies regularly make the Fortune 500 list; it has highly skilled graduates and engineers but struggles to compete globally; it has an alphabet-soup of agencies intended to support fledgling businesses, but they are so lacking in coherence that they remain unheard of to many; there is a vibrant investor community ready to commit funds, but only once an entrepreneur has a proven track record; and the French embrace money, but not bling.
  • the French like entrepreneurs when they remain very discreet and don’t transform into a businessman. That’s where the evil begins. So they like the number two. They don’t like success. They have a problem with wealth and with money.”
  • French businesses have their wings clipped by onerous social charges paid to the government based on the salary of the employee. Companies need to think twice before hiring and firing, when employees are often due extensive severance benefits. They also need to coax financing from a traditionally risk-averse market and console themselves with the relatively small clout that businesses hold in government.
Javier E

Mark Zuckerberg, Let Me Pay for Facebook - NYTimes.com - 0 views

www.nytimes.com/...g-let-me-pay-for-facebook.html

social media micropayments ad-financed business model privacy facebook

shared by Javier E on 05 Jun 15 - No Cached
  • 93 percent of the public believes that “being in control of who can get information about them is important,” and yet the amount of information we generate online has exploded and we seldom know where it all goes.
  • the pop-up and the ad-financed business model. The former is annoying but it’s the latter that is helping destroy the fabric of a rich, pluralistic Internet.
  • Facebook makes about 20 cents per user per month in profit. This is a pitiful sum, especially since the average user spends an impressive 20 hours on Facebook every month, according to the company. This paltry profit margin drives the business model: Internet ads are basically worthless unless they are hyper-targeted based on tracking and extensive profiling of users. This is a bad bargain, especially since two-thirds of American adults don’t want ads that target them based on that tracking and analysis of personal behavior.
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  • This way of doing business rewards huge Internet platforms, since ads that are worth so little can support only companies with hundreds of millions of users.
  • Ad-based businesses distort our online interactions. People flock to Internet platforms because they help us connect with one another or the world’s bounty of information — a crucial, valuable function. Yet ad-based financing means that the companies have an interest in manipulating our attention on behalf of advertisers, instead of letting us connect as we wish.
  • Many users think their feed shows everything that their friends post. It doesn’t. Facebook runs its billion-plus users’ newsfeed by a proprietary, ever-changing algorithm that decides what we see. If Facebook didn’t have to control the feed to keep us on the site longer and to inject ads into our stream, it could instead offer us control over this algorithm.
  • Many nonprofits and civic groups that were initially thrilled about their success in using Facebook to reach people are now despondent as their entries are less and less likely to reach people who “liked” their posts unless they pay Facebook to help boost their updates.
  • What to do? It’s simple: Internet sites should allow their users to be the customers. I would, as I bet many others would, happily pay more than 20 cents per month for a Facebook or a Google that did not track me, upgraded its encryption and treated me as a customer whose preferences and privacy matter.
  • Many people say that no significant number of users will ever pay directly for Internet services. But that is because we are misled by the mantra that these services are free. With growing awareness of the privacy cost of ads, this may well change. Millions of people pay for Netflix despite the fact that pirated copies of many movies are available free. We eventually pay for ads, anyway, as that cost is baked into products we purchase
  • A seamless, secure micropayment system that spreads a few pennies at a time as we browse a social network, up to a preset monthly limit, would alter the whole landscape for the better.
  • we’re not starting from scratch. Micropayment systems that would allow users to spend a few cents here and there, not be so easily tracked by all the Big Brothers, and even allow personalization were developed in the early days of the Internet. Big banks and large Internet platforms didn’t show much interest in this micropayment path, which would limit their surveillance abilities. We can revive it.
  • If even a quarter of Facebook’s 1.5 billion users were willing to pay $1 per month in return for not being tracked or targeted based on their data, that would yield more than $4 billion per year — surely a number worth considering.
  • Mr. Zuckerberg has reportedly spent more than $30 million to buy the homes around his in Palo Alto, Calif., and more than $100 million for a secluded parcel of land in Hawaii. He knows privacy is worth paying for. So he should let us pay a few dollars to protect ours.
katherineharron

Fed takes emergency action to stave off a depression - CNN - 0 views

www.cnn.com/...index.html

shared by katherineharron on 23 Mar 20 - No Cached
  • The Federal Reserve is signaling it will do whatever it takes to save the coronavirus-ravaged American economy from a depression.
  • Taken together, the Fed said the new programs will provide up to $300 billion in new financing to an economy getting crushed by the crippling health restrictions aimed at fighting the pandemic. The Fed is going all out to prevent the health crisis from turning into a full-blown financial crisis.
  • US stock futures spiked on the new emergency actions from the Fed, which has already slashed interest rates to zero. Recession fears and a liquidity crunch have crashed the stock market over the past month and caused parts of the bond market to malfunction.
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  • The Fed said it will support American households and businesses, but it acknowledged "our economy will face severe disruptions."
  • The social distancing policies imposed to fight the coronavirus crisis have brought the American economy to its knees. Malls are empty. Factories have been shut down. Casinos have gone dark. And countless flights have been suspended. The economic toll is massive.
  • Aided by extremely low interest rates, US businesses have borrowed heavily over the past decade to hire workers, build factories, research new products and pay for share buybacks. That debt now looks especially treacherous as the economy goes into a tailspin.
johnsonel7

Number of teenagers starting businesses up eightfold since 2009 | Business | The Guardian - 0 views

www.theguardian.com/...nesses-up-eightfold-since-2009

generations psychology

shared by johnsonel7 on 02 Jan 20 - No Cached
  • The number of teenagers setting up businesses has increased eightfold in the past decade, a study has found. The rise from 500 in 2009 to more than 4,000 has been driven by technology startups, according to the Brighton-based financial services provider OneFamily, which commissioned the research.
  • “Generation Z were born after Google and have grown up with social media, so it’s no surprise that these teens are already using their networks to help build their career. We also know that many are already making money from it.
sissij

A Beginners Guide To Parkinson's Law: How To Do More Stuff By Giving Yourself... - 1 views

impossiblehq.com/parkinsons-law

Parkinson's law psychology brain science

shared by sissij on 18 Nov 16 - No Cached
  • Parkinson’s Law: “Work expands so as to fill the time available for its completion.”
  • You had all week to finalize a proposal, but waited to do it until 4:30pm on the Friday.
  • He found that even a series of simple tasks increased in complexity to fill up the time allotted to it. As the length of time allocated to a task became shorter, the task became simpler and easier to solve.
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  • Interestingly enough, I worked more but got less done. On top of that, I was stressed all the time.
  • I was an addict, not to work, but to thinking that I was working.
  • Specificity and restrictions create freedom and nourish creativity. Add them to your arsenal of tools as you become an uber productive and efficient creator.
  • I’ve referred to this in the past as “shoot first, aim later” or “jump … and then figure it out on the way down.” Pick a big goal, commit to it, and you’ll probably find that you’re able to figure out a way to achieve it.
  • sissij on 18 Nov 16
     
    I found this law very interesting. It also reminds me of the TedTalk we had during advisory on procrastination. Being busy and being busy and efficient is completely different. I have a personally experience that agree on this law. Last week, my days were completely filled with cross-country practice, musical rehearsal, and school work, so everyday I sleep around eleven o'clock. This week, I suddenly have a lot more time as the cross-country season ends and the musical is over, but I still go to bed at eleven o'clock and fill my time still not enough for me. I was busy this week but obviously, my efficiency is much lower than last week. --Sissi (11/18/2016)
Javier E

In 'Misbehaving,' an Economics Professor Isn't Afraid to Attack His Own - NYTimes.com - 0 views

www.nytimes.com/...ehaving-by-richard-thaler.html

economics rationality behavioral social science utilitarian moral reasoning theory optimization chicago

shared by Javier E on 31 May 15 - No Cached
  • the book is part memoir, part attack on a breed of economist who dominated the academy – particularly, the Chicago School that dominated economic theory at the University of Chicago – for the much of the latter part of the 20th century.
  • economists have increasingly become the go-to experts on every manner of business and public policy issue facing society.
  • rather than being a disgruntled former employee or otherwise easily marginalized whistle-blower, Mr. Thaler recently took the reins as president of the American Economic Association (and still teaches at Chicago’s graduate business program
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  • The economics profession that Mr. Thaler entered in the early 1970s was deeply invested in proving that it was more than a mere social science.
  • But economic outcomes are the result of human decision-making. To achieve the same mathematical precision of hard sciences, economists made a radically simplifying assumption that people are “optimizers” whose behavior is as predictable as the speed of physical body falling through space.
  • After so-called behavioral economics began to go mainstream, Professor Thaler turned his attention to helping solve a variety of business and, increasingly, public policy issues. As these tools have been applied to practical problems, Professor Thaler has noted that there has been “very little actual economics involved.” Instead, the resulting insights have “come primarily from psychology and the other social sciences.”
  • it is actually “a slur on those other social sciences if people insist on calling any policy-related research some kind of economics.”
  • Professor Thaler’s narrative ultimately demonstrates that by trying to set itself as somehow above other social sciences, the “rationalist” school of economics actually ended up contributing far less than it could have. The group’s intellectual denial led to not just sloppy social science, but sloppy philosophy.
  • Economists would do well to embrace both their philosophical and social science roots. No amount of number-crunching can replace the need to confront the complexity of human existence.
  • It is not only in academics that the most difficult questions are avoided behind a mathematical smoke screen. When businesses use cost-benefit analysis, for instance, they are applying a moral philosophy known as utilitarianism, popularized by John Stuart Mill in the 19th century.
  • Compared against alternative moral philosophies, like those of Kant or Aristotle, Mill has relatively few contemporary adherents in professional philosophical circles. But utilitarianism does have the virtue of lending itself to mathematical calculation. By giving the contentious philosophy a benign bureaucratic name like “cost-benefit analysis,” corporations hope to circumvent the need to confront the profound ethical issues implicated.
  • The “misbehaving” of Professor Thaler’s title is supposed to refer to how human actions are inconsistent with rationalist economic theory
charlottedonoho

Organizational Success and Culture | Great Work Cultures - 0 views

www.huffingtonpost.com/...onal-success-an_b_7497594.html

culture morals business fear

shared by charlottedonoho on 03 Jun 15 - No Cached
  • Despite his best efforts, none of his business ventures ever achieved any commercial success, but his journey sparked in me an immense desire to understand how successful businesses are structured and managed. What I have come to appreciate is that no management structure or style is certain to result in business success but organizational cultures that encourage initiative, innovation and creativity are more effective than those cultures based on control.
  • He adopted a command and control management structure coupled with a patriarchal management style to operate his business. I don't think this was an intentional decision but like many new and less experienced entrepreneurs, organizational culture isn't usually a factor considered by the entrepreneur when determining how to build a successful enterprise. Instead, organizational cultures are often a byproduct of necessity driven by the demands of the business coupled with the leader's personal value system.
  • It is commonplace for leaders to choose management structures and styles that align with their own value systems. Like my father, many leaders possess a value system where the person at the top makes all the decisions and everyone else has to simply conform or risk losing their job.
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  • In these cultures, leaders are fearful of losing their livelihood and use the same fear to lead their employees. So, it is not surprising that so many of us have experienced unjust and inequitable working conditions in command and control cultures where leaders use fear and aggression as the means to drive employee productivity.
  • Eventually, the very thing she was trying to protect, her livelihood, was lost. Would she have saved her own job had she opted for a different organizational structure or a nicer management style?
  • Though, historically, the command and control management structure and its many iterations of management styles has been successfully used by many companies, there is evidence that organizational cultures based on value systems that reward initiative, creativity and innovation result in greater employee productivity, loyalty and engagement than cultures based on control. In other words, organization's that adopt command and control management structures, even when coupled with friendlier management styles, are likely to find that employee productivity, engagement and loyalty are not as high as those organizational cultures that encourage initiative, creativity and innovation.
caelengrubb

Student loan debt: Here are 7 ways the $1.6 trillion toll affects the U.S. economy - Th... - 0 views

www.washingtonpost.com/...-loan-debt-is-doing-us-economy

shared by caelengrubb on 26 Mar 21 - No Cached
  • American families are carrying about $1.6 trillion in student loan debt, a massive burden that amounts to nearly 8 percent of national income. That share has roughly doubled since the mid-2000s.
  • Years of research show that such post-college debt compels people to put off marriage and home ownership. It also stifles entrepreneurship and career paths.
  • Student loan debt is taking a bite out of the housing market
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  • A $1,000 increase in student loan debt, researchers found, lowered the odds of marriage by 2 percent a month among female bachelor’s degree recipients in the first four years after graduation. That finding has been bolstered by more recent research showing a similar trend.
  • Student loan debt is hampering the growth of small businesses
  • a significant and economically meaningful negative correlation” between rising student loan debt and falling small-business formation. The mechanism isn’t hard to grasp: If you’re paying off a student loan, you’re less able to pull together the cash needed to start a business.
  • The authors note that small businesses are responsible for “approximately 60 percent of net employment activity in the U.S.”
  • Student loan debt is delaying marriage and family formation
  • This year, the Federal Reserve issued a report showing that student loan debt prevented about 400,000 young families from purchasing homes, accounting for about a quarter of the drop in home-ownership rates in this demographic from 2005 to 2014
  • Student loan debt makes it harder to weather financial crises
  • From 2007 to 2009, households with student loans saw 12.4 percent of their total net worth evaporate, while the net worth of those without such loans fell by 9.3 percent
  • Student loan debt is preventing young people from saving for retirement
  • Student loan debt can cause graduates to give up on their dreams
  • The returns on higher education aren’t what they once were
Javier E

The Economic Case for Regulating Social Media - The New York Times - 0 views

www.nytimes.com/...media-facebook-regulation.html

social media network economics conspiracy theory hate speech addiction platform ad-financed business model click-bait psychology technology

shared by Javier E on 15 Feb 21 - No Cached
  • Social media platforms like Facebook, YouTube and Twitter generate revenue by using detailed behavioral information to direct ads to individual users.
  • this bland description of their business model fails to convey even a hint of its profound threat to the nation’s political and social stability.
  • legislators in Congress to propose the breakup of some tech firms, along with other traditional antitrust measures. But the main hazard posed by these platforms is not aggressive pricing, abusive service or other ills often associated with monopoly.
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  • Instead, it is their contribution to the spread of misinformation, hate speech and conspiracy theories.
  • digital platforms, since the marginal cost of serving additional consumers is essentially zero. Because the initial costs of producing a platform’s content are substantial, and because any company’s first goal is to remain solvent, it cannot just give stuff away. Even so, when price exceeds marginal cost, competition relentlessly pressures rival publishers to cut prices — eventually all the way to zero. This, in a nutshell, is the publisher’s dilemma in the digital age.
  • These firms make money not by charging for access to content but by displaying it with finely targeted ads based on the specific types of things people have already chosen to view. If the conscious intent were to undermine social and political stability, this business model could hardly be a more effective weapon.
  • The algorithms that choose individual-specific content are crafted to maximize the time people spend on a platform
  • As the developers concede, Facebook’s algorithms are addictive by design and exploit negative emotional triggers. Platform addiction drives earnings, and hate speech, lies and conspiracy theories reliably boost addiction.
  • the subscription model isn’t fully efficient: Any positive fee would inevitably exclude at least some who would value access but not enough to pay the fee
  • a conservative think tank, says, for example, that government has no business second-guessing people’s judgments about what to post or read on social media.
  • That position would be easier to defend in a world where individual choices had no adverse impact on others. But negative spillover effects are in fact quite common
  • individual and collective incentives about what to post or read on social media often diverge sharply.
  • There is simply no presumption that what spreads on these platforms best serves even the individual’s own narrow interests, much less those of society as a whole.
  • a simpler step may hold greater promise: Platforms could be required to abandon that model in favor of one relying on subscriptions, whereby members gain access to content in return for a modest recurring fee.
  • Major newspapers have done well under this model, which is also making inroads in book publishing. The subscription model greatly weakens the incentive to offer algorithmically driven addictive content provided by individuals, editorial boards or other sources.
  • Careful studies have shown that Facebook’s algorithms have increased political polarization significantly
  • More worrisome, those excluded would come disproportionately from low-income groups. Such objections might be addressed specifically — perhaps with a modest tax credit to offset subscription fees — or in a more general way, by making the social safety net more generous.
  • Adam Smith, the 18th-century Scottish philosopher widely considered the father of economics, is celebrated for his “invisible hand” theory, which describes conditions under which market incentives promote socially benign outcomes. Many of his most ardent admirers may view steps to constrain the behavior of social media platforms as regulatory overreach.
  • But Smith’s remarkable insight was actually more nuanced: Market forces often promote society’s welfare, but not always. Indeed, as he saw clearly, individual interests are often squarely at odds with collective aspirations, and in many such instances it is in society’s interest to intervene. The current information crisis is a case in point.
Javier E

AI is about to completely change how you use computers | Bill Gates - 0 views

www.gatesnotes.com/AI-agents

ai gates applications opportunities technology

shared by Javier E on 10 Nov 23 - No Cached
  • Health care
  • Entertainment and shopping
  • Today, AI’s main role in healthcare is to help with administrative tasks. Abridge, Nuance DAX, and Nabla Copilot, for example, can capture audio during an appointment and then write up notes for the doctor to review.
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  • agents will open up many more learning opportunities.
  • Already, AI can help you pick out a new TV and recommend movies, books, shows, and podcasts. Likewise, a company I’ve invested in, recently launched Pix, which lets you ask questions (“Which Robert Redford movies would I like and where can I watch them?”) and then makes recommendations based on what you’ve liked in the past
  • Productivity
  • copilots can do a lot—such as turn a written document into a slide deck, answer questions about a spreadsheet using natural language, and summarize email threads while representing each person’s point of view.
  • before the sophisticated agents I’m describing become a reality, we need to confront a number of questions about the technology and how we’ll use it.
  • Helping patients and healthcare workers will be especially beneficial for people in poor countries, where many never get to see a doctor at all.
  • To create a new app or service, you won’t need to know how to write code or do graphic design. You’ll just tell your agent what you want. It will be able to write the code, design the look and feel of the app, create a logo, and publish the app to an online store
  • Agents will do even more. Having one will be like having a person dedicated to helping you with various tasks and doing them independently if you want. If you have an idea for a business, an agent will help you write up a business plan, create a presentation for it, and even generate images of what your product might look like
  • For decades, I’ve been excited about all the ways that software would make teachers’ jobs easier and help students learn. It won’t replace teachers, but it will supplement their work—personalizing the work for students and liberating teachers from paperwork and other tasks so they can spend more time on the most important parts of the job.
  • Mental health care is another example of a service that agents will make available to virtually everyone. Today, weekly therapy sessions seem like a luxury. But there is a lot of unmet need, and many people who could benefit from therapy don’t have access to it.
  • I don’t think any single company will dominate the agents business--there will be many different AI engines available.
  • The real shift will come when agents can help patients do basic triage, get advice about how to deal with health problems, and decide whether they need to seek treatment.
  • They’ll replace word processors, spreadsheets, and other productivity apps.
  • Education
  • For example, few families can pay for a tutor who works one-on-one with a student to supplement their classroom work. If agents can capture what makes a tutor effective, they’ll unlock this supplemental instruction for everyone who wants it. If a tutoring agent knows that a kid likes Minecraft and Taylor Swift, it will use Minecraft to teach them about calculating the volume and area of shapes, and Taylor’s lyrics to teach them about storytelling and rhyme schemes. The experience will be far richer—with graphics and sound, for example—and more personalized than today’s text-based tutors.
  • your agent will be able to help you in the same way that personal assistants support executives today. If your friend just had surgery, your agent will offer to send flowers and be able to order them for you. If you tell it you’d like to catch up with your old college roommate, it will work with their agent to find a time to get together, and just before you arrive, it will remind you that their oldest child just started college at the local university.
  • To see the dramatic change that agents will bring, let’s compare them to the AI tools available today. Most of these are bots. They’re limited to one app and generally only step in when you write a particular word or ask for help. Because they don’t remember how you use them from one time to the next, they don’t get better or learn any of your preferences.
  • The current state of the art is Khanmigo, a text-based bot created by Khan Academy. It can tutor students in math, science, and the humanities—for example, it can explain the quadratic formula and create math problems to practice on. It can also help teachers do things like write lesson plans.
  • Businesses that are separate today—search advertising, social networking with advertising, shopping, productivity software—will become one business.
  • other issues won’t be decided by companies and governments. For example, agents could affect how we interact with friends and family. Today, you can show someone that you care about them by remembering details about their life—say, their birthday. But when they know your agent likely reminded you about it and took care of sending flowers, will it be as meaningful for them?
  • In the computing industry, we talk about platforms—the technologies that apps and services are built on. Android, iOS, and Windows are all platforms. Agents will be the next platform.
  • A shock wave in the tech industry
  • Agents won’t simply make recommendations; they’ll help you act on them. If you want to buy a camera, you’ll have your agent read all the reviews for you, summarize them, make a recommendation, and place an order for it once you’ve made a decision.
  • Agents will affect how we use software as well as how it’s written. They’ll replace search sites because they’ll be better at finding information and summarizing it for you
  • they’ll be dramatically better. You’ll be able to have nuanced conversations with them. They will be much more personalized, and they won’t be limited to relatively simple tasks like writing a letter.
  • Companies will be able to make agents available for their employees to consult directly and be part of every meeting so they can answer questions.
  • AI agents that are well trained in mental health will make therapy much more affordable and easier to get. Wysa and Youper are two of the early chatbots here. But agents will go much deeper. If you choose to share enough information with a mental health agent, it will understand your life history and your relationships. It’ll be available when you need it, and it will never get impatient. It could even, with your permission, monitor your physical responses to therapy through your smart watch—like if your heart starts to race when you’re talking about a problem with your boss—and suggest when you should see a human therapist.
  • If the number of companies that have started working on AI just this year is any indication, there will be an exceptional amount of competition, which will make agents very inexpensive.
  • Agents are smarter. They’re proactive—capable of making suggestions before you ask for them. They accomplish tasks across applications. They improve over time because they remember your activities and recognize intent and patterns in your behavior. Based on this information, they offer to provide what they think you need, although you will always make the final decisions.
  • Agents are not only going to change how everyone interacts with computers. They’re also going to upend the software industry, bringing about the biggest revolution in computing since we went from typing commands to tapping on icons.
  • The most exciting impact of AI agents is the way they will democratize services that today are too expensive for most people
  • The ramifications for the software business and for society will be profound.
  • In the next five years, this will change completely. You won’t have to use different apps for different tasks. You’ll simply tell your device, in everyday language, what you want to do. And depending on how much information you choose to share with it, the software will be able to respond personally because it will have a rich understanding of your life. In the near future, anyone who’s online will be able to have a personal assistant powered by artificial intelligence that’s far beyond today’s technology.
  • You’ll also be able to get news and entertainment that’s been tailored to your interests. CurioAI, which creates a custom podcast on any subject you ask about, is a glimpse of what’s coming.
  • An agent will be able to help you with all your activities if you want it to. With permission to follow your online interactions and real-world locations, it will develop a powerful understanding of the people, places, and activities you engage in. It will get your personal and work relationships, hobbies, preferences, and schedule. You’ll choose how and when it steps in to help with something or ask you to make a decision.
  • even the best sites have an incomplete understanding of your work, personal life, interests, and relationships and a limited ability to use this information to do things for you. That’s the kind of thing that is only possible today with another human being, like a close friend or personal assistant.
  • In the distant future, agents may even force humans to face profound questions about purpose. Imagine that agents become so good that everyone can have a high quality of life without working nearly as much. In a future like that, what would people do with their time? Would anyone still want to get an education when an agent has all the answers? Can you have a safe and thriving society when most people have a lot of free time on their hands?
  • They’ll have an especially big influence in four areas: health care, education, productivity, and entertainment and shopping.
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