- Scholars Stage has a great meditation on political legitimacy, as it's interpreted in different times and places. Some political institutions have parallel evolution despite a lack of contact—lots of cultures independently invent some version of a monarch and some sort of religion—but there are recent evolutionary pressures that have pushed more of them to converge.
- Vitalik Buterin has a very different look at legitimacy, in the economic realm. Who can say that a given NFT is valuable, or that it isn't? Is a blank white square worthless, or is it a $20m piece of art? The NFT trend is the crypto world's way of illustrating that some things still happen by fiat.
- Samo Burja has a great piece on the end of industrial society. Many interesting points within, especially about the shift from personal to institutional power. (Flat, egalitarian org charts tend to recreate this kind of personal power.) And this was an especially good insight: "The cities late to industrialization, such as 19th-century Vienna, were also the cities that hit the highest cultural watermarks, as those educated in the old system were able to deploy their talents in the new." Are there any modern cities, or social clusters, that have been left behind by the growth of tech and finance, and have made interesting artistic contributions as a result?
- The Berkeley School: part of this is a narrative about changing academic fashions, which is not necessarily high-signal. But it's also an interesting look at how contingent those changes are on outside effects: Berkeley downsized its economics department in the early 90s due to budget cuts, which meant that new hires had outsized influence once the department grew again. And those new hires happened to coincide with more available data, and better data processing, so the department got better at deeply factual, less theory-laden analyses.
- The story of two-buck chuck is a nearly perfect parable of zero-to-one innovation colliding with one-to-N scaling.
A good week for books:
- Age of Edison a history of the social impact of electric lighting. Ubiquitous cheap light transformed the world, sometimes in non-obvious ways.
- Salazar was the dictator of Portugal from 1932 to 1968. What he presided over was very strange, and might best be described as skipping the mid-twentieth century entirely. Most of Europe politically reorganized itself in this period, often several times, but Portugal more or less sat it out. The result was a strange time capsule.
- Working Backwards: A very good book on Amazon's distinctive management style. Some of this can be translated to other businesses, although a lot of it seems to have evolved from the company's heritage as a low-margin, operationally-intensive bookseller. This book is a good way to understand Amazon at several levels. (And it notes that working at Amazon is a good way to understand the company at several levels, since senior employees participate in things like customer service and, in the past, order fulfillment. Running a labor-intensive business with little room for error is a great way to synthetically create a hazing program.)
- The Merchant of Power: Samuel Insull is very underrated as an operator/financial engineer. He figured out the revenue and financing model for utilities back when they were a growth business, although leverage undid him in the early 1930s. Still, it's a book with many lessons for anyone involved in a business with upfront costs and a variable, long-duration stream of high-margin revenue thereafter.
- Any good links I missed this week that would be of interest to Diff readers?
- Earlier in the week, I talked about ARK investment's partly open-source model. One drawback to this is that it tells short-sellers exactly which stocks to bet against when ARK is getting outflows, or likely to. Has the tradeoff between publicity and adversarial trading changed, or is ARK just a new victim of a model that produces upside for a while but eventually runs into unavoidable downside?
- It's easy to find books on contemporary business successes, or after-the-fact reports on failures. But one of the best micro-genres is books about companies that were doing well when the book came out, and that subsequently failed. Can anyone recommend good examples of these?