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Links and quotations for October 2, 2015: On-demand vs. disruptive business, how privacy panics distort policy, and more
An interesting look here at whether the most popular and seemingly innovative businesses are truly disruptive, or actually have weaker value propositions. Also, lessons from how privacy panics historically limit innovation, a spotlight on the freelancer and his political priorities, and mounting physical violence against Uber in Brazil.
What Generous People’s Brains Do Differently – HBR – “New research from the emerging field of neuroeconomics suggests that being generous is not as tough as some people think. But even so, it is pretty rare.”
IBM says its carbon-nanotube-based chips can break through limits of Moore’s Law- Fast Company – “… The result, the company said, could be smaller and faster computer chips that significantly surpass what’s possible with today’s silicon semiconductors. … In recent years, however, it has appeared likely that industry has reached the limits of physics when it comes to doubling the power of silicon chips.”
Most On-Demand Businesses Aren’t Actually Disruptive – HBR
How TV Sustains the Work Ethic – Aeon – “You probably shouldn’t start thinking of your 9-to-5 job as if you were President Bartlet, let alone Abraham Lincoln. Don Draper’s Gettysburg fantasy leads only to the Coca-Cola I’d Like to Teach the World to Sing commercial – a tawdry vision of unity (this time global rather than national) and a much less savory version of US patriotism, though a triumphant professional accomplishment. Still, in the interest of getting to better social arrangements, something like the fate of the republic, or the public good, ought to be allowed to hover above what we presently do for a living. The economy is strong enough to invite that kind of scrutiny.”
From Kodak To Google, How Privacy Panics Distort Policy- TechCrunch
This cycle of panic-then-acceptance can slow innovation and adoption of new technologies. To be sure, some technologies have challenged traditional notions of privacy, or even presented new risks to consumers, and to the extent that there are legitimate risks of consumer harm, these concerns should be taken seriously. However, it is important to recognize that the privacy panic cycle is a detrimental one — with a long historical precedent.
[…] We will continue to see the privacy panic cycle distort the public reception of new technologies unless we begin to recognize it. Technologies will always have some tradeoffs, and there is no question that we need smart policies that both mitigate concerns and optimize societal benefits. But when privacy advocates merely scare consumers away from innovation rather than working to create sensible solutions for integrating useful new technologies into society, they slow the pace of economic and social progress.
This is what the state of freelancing in the US means for the future of work – Fast Company
There are now almost 54 million Americans freelancing, an increase of 700,000 over last year. That’s more than a third of the American workforce. Millennials, as I’ve argued before, are native freelancers, and it shows: They are freelancing at a higher rate than any other group. …
And even in this political season, the candidates for president—desperate as they are to appeal to untapped caches of voters—have not yet begun to talk to freelancers and independent workers. That’s a mistake: Freelancers are a large and motivated voting bloc. In our survey, 86% said they plan to vote in the 2016 election. That’s a staggering turnout figure. And 62% said they’d vote for the candidate who supports independent workers’ interests. That means millions of votes are up for grabs.
The Fight Against Uber Is Getting Violent In Brazil – TechCrunch
All four cities Uber currently operates in Brazil have registered taxi driver violence against Uber drivers. In capital city Brasilia, taxi drivers attacked a private driver they mistook for an Uber driver at the airport. In Belo Horizonte, several Uber drivers have reported being followed, threatened and attacked an by taxi drivers. Taxi drivers kidnapped and beat an Uber driver in São Paulo. The head of São Paulo’s taxi syndicate recently told councilmembers, “Someone is going to die.”
In Rio, a crowd of several hundred taxi drivers protesting the service in Rio surrounded two Uber cars, called the police, who arrested the drivers and escorted the passengers to…. wait for it… taxis. At a bigger protest in July, the head of Rio’s taxi syndicate told the press, “We don’t want these pirates driving on the streets.”
While taxi drivers must pass through a battery of paperwork, courses, exams and fees to offer what is known as public individual transportation in Brazil, private individual transportation services don’t have specific regulations on the books. “This is very different from being illegal,” Uber spokesperson Fabio Sabba says.
I was at a financial conference, also attended by a former Democratic politician — a person some used to think was potentially veep material, at least. At one point, this person wondered aloud, “Why don’t we just make college free?” In other words, why not spend more money on higher education to increase affordability? Or, really, eliminate affordability as an issue at all? This idea seems to be gaining traction on the left.
Now there was no consideration about the design flaws in the federal student aid system or what sorts of institutional behaviors it encourages. It’s a system where colleges are empowered, as my colleague Andrew Kelly points out, “to capture as much federal aid as they can.” It is a system that makes it almost impossible for the customers to comparison shop or truly know the value of what they are purchasing. The market test is never really conducted. Kelley: “In short, the problem is not only that we make so much money available in student aid, but that we make so much money available with very few strings attached.”
Likewise, the focus on what college costs ignores the failure of the financial aid system to promote value. So here from Kelly are several reforms that would encourage colleges to compete on price and value:
First, capping PLUS loans to parents and graduate students, which allow unlimited borrowing up to the cost of attendance, seems like a straightforward reform to curb tuition inflation. Reforming generous loan forgiveness programs to encourage prudent borrowing is another.
Second, federal policy should empower consumers with better information about costs and student outcomes. The College Scorecard’s new earnings data is a start. But the federal government should expand on this effort to collect and make public program-level outcome data.
Third, policymakers should create two simple accountability mechanisms based on loan repayment rates: a performance floor that would exclude the worst-performing institutions from federal aid programs and a risk-sharing policy that would give institutions above that floor greater skin in the game. If all colleges were held responsible for a percentage of their students’ unpaid loans, they would have incentive to contain their tuition, maximize rates of student success, and reconsider their admissions standards.
Fourth, reforms should create space for private financing that can inject more market discipline into higher education. In theory, private investors could underwrite on the basis of program quality and future earnings, driving students toward valuable opportunities. Existing private student loans do not appear to be forward-looking in this way. More than 90% of new loans feature a co-signer.
An alternative is an Income Share Agreement, under which students obtain funding for school in exchange for a percentage of their after-school income over a set period of time. Because an investor’s return is directly tied to a student’s success, ISA providers have incentive to help students navigate toward valuable opportunities There are a number of for-profit and nonprofit entities trying to offer this option to students, but a lack of legal and regulatory clarity has limited the growth of this market. Policymakers like Senator Marco Rubio and Representatives Todd Young and Jared Polis have introduced bills that would provide such clarity and put common sense consumer protections in place.
It’s not there were no encouraging bits in the September jobs report. There were. Long-term unemployment fell. So did people working part-time who would prefer full-time gigs. Ugh, but the rest.
1.) Just 142,000 net new payrolls (and a mere 118,000 in the private sector) vs. the 200,000 consensus forecast. Also, the July and August numbers were revised lower by 59,000.
2.) Household employment fell by 236,000. And if combine that number with the payrolls number using the 20/80 weighting suggested by economist Justin Wolfers, the economy may have lost something like 66,000 jobs last month.
3.) In the third quarter, average monthly job gains averaged 167,000 versus 237,000 in 3Q 2014. Deceleration.
4.) Both the labor force participation and employment rates fell, the former to a 38-year low. Those “Not in Labor Force” increased by 579,000, while “Employed” fell by 236,000.
5.) Average hourly earnings actually fell by a penny with the long-term growth trend stuck around 2%.
In other words, how did everyone enjoy the sweet spot of the Great Recovery? Those were heady days! Good times had by all. Here is how Barclays summed up the month:
Beyond the headline number, we see broad-based weakness in US labor markets, with the past month’s revisions now showing a decidedly softer trend growth in jobs. Although the U3 unemployment rate was unchanged at 5.1%, the participation rate fell 0.2 to 62.4%. The broader U6 underemployment rate, which includes part-time workers, declined three-tenths, to 10.0%, as the number of workers who are part time for economic reasons dropped sharply. However, given the overall weakness in the report, we do not take that decline as a positive sign, as some of that decline likely reflects workers leaving the workforce rather than finding full time work. Average hourly earnings were also soft, rising 0.0% m/m, much weaker than expected.
This report is much weaker than we had expected. We believe the weakness in payroll employment growth and hours worked reflect the deceleration in activity abroad and, more recently, the pickup in financial market volatility domestically. Past experience suggests that these episodes temporarily weigh on demand for labor and we raised this as a risk to our outlook on August 24 when we pushed out our expectation for the first rate hike to March 2016. Our past research on the subject suggests it takes more than just a few months for these pot holes in global growth and uncertainty to fade. In the meantime, US activity, payroll growth, and inflation tend to soften. As such, we retain our view that rate hikes will be deferred past year end and we believe this employment report substantially reduces the probability of a rate hike from the FOMC this year.
Update: And this from IHS Global Insight:
The September jobs report was uniformly disappointing. Not only was jobs growth in the month well below the yearly average, the gains in the prior two months were trimmed by a total of 59,000. The simultaneous declines in labor force participation and hours worked are also reasons to worry. Last but not least, stagnant wages are worrisome.
Two months of weak payroll gains suggest that the mighty US jobs machine may be losing some steam. Potential culprits include weakness overseas (which is hurting manufacturing), volatility in the stock market (which is making companies more cautious), and weak productivity growth (forcing companies to boost productivity by shedding workers).
Implications for the first Fed rate hike: in retrospect, the decision by the Fed to hold fire seems like a good one. There has been a downshift in jobs growth and wage inflation remains very low. The earlier rationale for raising rates has now lost some validity. As of this moment, the odds are slightly better than 50/50 that the first Fed hike will come in December. However another month or two of weak jobs growth could mean a further delay.
Hey, let’s scapegoat Airbnb for high San Francisco housing prices instead of, you know, building more housing
In my previous post, I mentioned the role of housing in exacerbating inequality. Pricey housing also hurts the economy by making it more expensive to live in high innovation cities like San Francisco. So what to do about this. Here is venture capitalist Sam Altman:
The whole magic of the sharing economy is better asset utilization and thus lower prices for everyone. Home sharing makes better utilization out of a fixed asset, and by more optimally filling space it means the same number of people can use less supply. In fact, Airbnb worked with economist Tom Davidoff of the University of British Columbia and found that Airbnb has affected the price of housing in SF by less than 1% either up or down.
But in the last 5 years, the cost of housing in the city has about doubled. The reason for this is a lot more people want to live in SF than we have housing for, and the city has been slow to approve new construction. Who is to blame for this? The same politicians that are trying to distract you with Airbnb’s 340 “professionally rented” units.
What should the politicians actually be doing about the housing crunch? The obvious answer would be to support building more housing and fixing the supply side of the equation. But instead they’re doing the opposite (e.g. a moratorium on new construction in the Mission) and trying to turn Airbnb into a scapegoat.
I love San Francisco. I wish housing here were much cheaper. This is a special city and more people are going to want to live here, and more are going to want to come visit and do business with people here. Instead of trying to ban the future, we should be making it easier for middle class families to stay in the city. We can do this by building more units to push the market price of housing down and by making it easier for San Franciscans to share their homes.
We’re #3! In its latest report, the World Economic Forum — the Davos people — ranks the US economy as the world’s third most competitive, behind Switzerland and Singapore. So actually the US is the most competitive large economy. From the report:
The United States retains 3rd place. Although many risks arguably loom on the horizon, the country’s recovery can build on improvements in institutions—government efficiency is rated higher than in previous years—its macroeconomic environment, and the soundness of its financial markets.
The United States’ major strength is its unique combination of exceptional innovation capacity (4th), large market size (2nd), and sophisticated businesses (4th). The country’s innovation capacity is driven by collaboration between firms and universities (2nd), human capital (4th on availability of scientists and engineers), and company spending on R&D (3rd). The United States also benefits from flexible labor markets (4th) and an overall well-developed financial sector (5th).
However, as accommodative monetary policy will slowly phase out and the US dollar has strengthened, the country will have to embark on a range of reforms to ensure that productivity growth picks up. These include improving the quality of education (18th), in particular at the primary level, and continuing to stabilize its macroeconomic environment (96th), which must include addressing high health and social security costs and ensuring continued strengthening of the financial system. Last but not least, further improvements to the institutional environment (28th) would put growth on a more sustainable footing.
So all the really big problems seem to be with government: poor schools, unfinanced entitlements, and inefficient Washington itself — shutdowns and debt ceiling crises. As for our innovation ranking, pretty good — though I would say the #4 ranking actually understates things. Too much emphasis on what government is doing vs. this.
Links and quotations for October 1, 2015: Presidential money maps and BlaBlaCar, Europe’s version of Uber
With the latest fundraising numbers reported in today from presidential candidates, a quick look at how they’ve done up to this point. That, how Twitter predicts your income level, Mark Zuckerberg waivers on free speech and censorship in Germany, and an introduction to BlaBlaCar, Europe’s translation of Uber.
Bosses Bribe Workers to Take Vacation in Healing U.S. Job Market – Bloomberg
Study: Racially charged hate crimes go up as broadband expands – Ars Technica – “The study, conducted by researchers at the University of Minnesota and NYU’s Stern School of Business, determined that depending on the year in question, every 65 percent increase in broadband in a given American county correlated with an uptick in racially charged hate crimes that ranged from 70 to 270 percent.”
Twitter Behavior Can Predict Users’ Income Level, New Penn Research Shows- RealClearScience
2015 Presidential Money Map – Bloomberg – Some sample images below, from the last round of fundraising.
Zuckerberg Tells Angela Merkel Facebook Is On The Hate Speech Censorship Case – TechDirt
Zuckerberg is allowed to do with Facebook as the site’s corporate interests please, but as an American leading a company that can only continue to benefit the world through the free exchange of ideas if the site rests on the principles of free speech, I would hope he might be cautious in what promises he might make that violate those principles.
How Bank of America exposes the false promise of the shareholder revolution- The Week
At the start of the shareholder revolution, it was seen as a hostile conflict between shareholders and management. But these days, corporate governance has adjusted such that CEOs and upper management are usually hard to disentangle from the corporate boards ostensibly elected by shareholders to oversee them. They’re also rewarded primarily with stock, so they’re essentially shareholders themselves. It’s no coincidence that inequality has been driven primarily by capital gains income, and that inequality and CEO compensation took off in conjunction with the 1980s shareholder revolt.
Europe Loves This Rideshare Startup (Hint: It’s Not Uber) – Wired
BlaBlaCar is a platform for long-distance ride-sharing over distances of about 150 to 200 miles, at a cost equivalent to about $25. The idea is that drivers who are going from one city to another—Paris to Brussels, for instance, or Munich to Berlin—can offer seats in their vehicles to passengers who need a ride. Drivers get paid for seats that would normally be empty, while riders travel for much cheaper than a train ticket would cost. BlaBlaCar takes a 15 to 20 percent cut after connecting the two parties. And so far, everyone involved has mostly escaped the wrath of regulators, in part because, according to BlaBlaCar, the drivers aren’t in it to make a profit—just to share the cost of a ride.
“The whole paradigm is based on people traveling anyway,” Nicolas Brusson, co-founder and COO of BlaBlaCar, tells WIRED. “So it’s real people sharing the cost of travel between those cities.”
Another way BlaBlaCar stands apart from the Ubers of the world is the emphasis on true “sharing.” The company’s platform becomes in effect a kind of social network; after all, if you’re going to spend a few hours in the car with someone, it’s good to get to know them a little better first.
The progressive/left-wing response to the new Brookings study on inequality is obvious, right? From “Would a significant increase in the top income tax rate substantially alter income inequality?”:
The high level of income inequality in the United States is at the forefront of policy attention. This paper focuses on one potential policy response: an increase in the top personal income tax rate. We conduct a simulation analysis using the Tax Policy Center (TPC) microsimulation model to determine how much of a reduction in income inequality would be achieved from increasing the top individual tax rate to as much as 50 percent. We calculate the resulting change in income inequality assuming an explicit redistribution of all new revenue to households in the bottom 20 percent of the income distribution.
The resulting effects on overall income inequality are exceedingly modest. That such a sizable increase in top income tax rates leads to such a limited reduction in income inequality speaks to the limitations of this particular approach to addressing the broader challenge. To be sure, our results do not speak to the general desirability of a more progressive tax-and-transfer schedule, just to the fact that even a significant tax increase on high-income households and corresponding transfer to low-income households has a small effect on overall inequality.
Study authors William Gale, Melissa Kearney, and Peter Orszag (!) call their proposed tax increase “sizable.” And it is. Top marginal tax rates haven’t been so high in a generation. And few politicians are publicly contemplating such an increase. Well, maybe Bernie Sanders is, though he doesn’t think it would be such a biggie. Remember the golden age that was the 1950s! And some top left-liberal economists have been arguing the US economy would be fine with a 70% top rate, if not higher. Surely some inequality alarmists would love the Brookings scholars to plug higher rates into that TPC model, though it seems doubtful the results would be dramatically different.
What would make a difference? Inequality researcher and best-selling author Thomas Piketty says “the main policy to reduce inequality is not progressive taxation, is not the minimum wage. It’s really education. It’s really investing in skills, investing in schools.” That would seem to reflect the idea, put forward by Steven Kaplan and Joshua Rauh, that technology and globalization have enabled the highly talented and educated individuals to manage or perform on a larger scale, “thus becoming more productive and higher paid.”
Then there’s the much-discussed analysis by economics grad student Matthew Rognlie that suggests surging real-estate prices play a big part in the inequality story. Here’s looking at you, San Francisco. In other words, as Noah Smith explains, “it’s landlords, not corporate overlords, who are sucking up the wealth in the economy.” If so, the Economist recommends, “policymakers should deal with the planning regulations and NIMBYism that inhibit housebuilding and which allow homeowners to capture super-normal returns on their investments.” (More here on how government drives inequality, the bad kind.) And Orszag himself has highlighted recent research showing pay inequality rising because some firms pay just pay a lot better.
Now there may be other reasons to increase high-end taxes, such as to fund expanded wage subsidies for low-income workers. But reducing inequality does not seem to be one of them.
Links and quotations for September 30, 2015: Tesla’s bio-defense, affordable Bay Area housing, understanding millennials, and more
Tesla has unveiled its Model X… and suggests a future need for weapons against biological warfare. Also an argument from Thomas Sowell on fixing unaffordable housing in San Francisco via simple supply and demand economics, even if it is politically painful, and Vanity Fair investigates criticism of millennials – where it is focused and whether it is for the right reasons.
US defends Safe Harbor, says it never uses “indiscriminate surveillance” – ArsTechnica
Tesla’s Model X Has A Bio Weapon Defense Mode Button (Seriously) – TechCrunch
The Simple Solution to High Rent in the Bay Area – NRO
Someone once told President Ronald Reagan that a solution to some controversial issue was “complex.” President Reagan replied that the issue was in fact simple, “but it is not easy.” … Is the solution to unaffordable housing prices in parts of California simple? Yes. It is as simple as supply and demand. What gets complicated is evading the obvious, because it is politically painful. … How “complex” is it to figure out that letting people build homes in some of that vast expanse of “open space” would keep housing from becoming “unaffordable”?
However simple the answer, it will not be easy to go against the organized, self-righteous activists for whom “open space” is a sacred cause, automatically overriding the interests of everybody else.
Uber London Revs Its Lobbying Engines Against “Bureaucratic” Rule Changes- TechCrunch
Transport for London, the local body responsible for transport regulations in the U.K. capital, has published a set of proposals for changes to regulations pertaining to the operation of private hire vehicles (PHVs) in the city — with the stated aim of improving passenger safety.
Any rule changes would of course affect the operation of Uber’s on-demand business in London, so the company has mobilized its U.K. users, urging them to sign a petition against the proposed new rules — which it dubs “bureaucratic”, arguing they would signal the end of the Uber “you know and love”.
Amazon Wades Further Into the Complex World of the Gig Economy – Wired
The online retailer has for weeks been quietly operating a new program called Amazon Flex, according to a report from The Wall Street Journal, and has been testing it in its hometown of Seattle. Flex works in much the same way as other popular on-demand companies, including Uber and Postmates, do under the so-called 1099 model: Using an app platform, a network of independent contractors can sign up for flexible delivery shifts. On Amazon Flex, the company has these independent contractors collect packages from warehouses and bring them to customers’ homes in an hour or so.
Do Millennials Really Deserve Their Bratty Reputation? – Vanity Fair
Is this group caricature anywhere close to fair, or a more virulent strain of traditional intergenerational bigotry? “I see something nasty in the getoffmylawnism that we get today that I don’t really remember previously,” the blogger Duncan Black noted at Eschaton. “I see a lot of hatred of the youngs. It’s troubling and weird.” Washington Post Wonkblog contributor Christopher Ingraham also sees a whole lot of hatin’ goin’ on, but believes it’s for the wrong reasons. Forget “the derisive talk of selfies and selfishness and Snapchat,” Ingraham wrote. “If you do want to hate on millennials, at least do them the credit of hating them for the right reasons,” he advises, helpfully coming up with five biggies, based upon recent polling.
(1) Millennials are the most unpatriotic generation, a disgrace to everything John Wayne growled for. (The upside to this, though neocons will not see it as such, is that Millies “are also far less supportive of the use of military force and may have internalized a permanent case of ‘Iraq Aversion,’ ” according to a Cato Institute white paper called “Millennials and U.S. Foreign Policy.”)
(2) For all their multi-culti airs, Millies are as racist in their attitudes as older coots.
(3) They are the most clueless, duh generation when it comes to the news.
(4) They’re the leading vaccine skeptics, “seven times as likely as seniors to believe in the unequivocally discredited link between vaccines and autism.”
(5) They are queasy about free speech and expression, though I don’t consider the survey Ingraham cites on publishing Muhammad cartoons a convincing example. A better citation might have been the wave of “trigger warnings,” safe places, “micro-aggressions,” and virtuoso claims of victim status that are turning so many universities into high-rent nurseries. It is such coddling and cocooning of educated Millennials within a comfort zone patrolled by helicopter parents and their proxies that provoked the novelist and screenwriter Bret Easton Ellis to diaper-pin them as the hypersensitive “Generation Wuss.”
Donald Trump to Fox’s Sean Hannity, in June:
HANNITY: Would you insist on a balanced budget as president?
TRUMP: I would insist on it relatively soon. Right now, we’re so under, we’re so far under that you can’t go too quickly. But I would absolutely insist on it relatively soon. And I would make deals that would be so good and fast.
Now here is the new Tax Foundation analysis of the Trump tax plan:
— Mr. Trump’s tax plan would substantially lower individual income taxes and the corporate income tax and eliminate a number of complex features in the current tax code.
— Mr. Trump’s plan would cut taxes by $11.98 trillion over the next decade on a static basis. However, the plan would end up reducing tax revenues by $10.14 trillion over the next decade when accounting for economic growth from increases in the supply of labor and capital.
— The plan would also result in increased outlays due to higher interest on the debt, creating a ten-year deficit somewhat larger than the estimates above.
— According to the Tax Foundation’s Taxes and Growth Model, the plan would significantly reduce marginal tax rates and the cost of capital, which would lead to an 11 percent higher GDP over the long term provided that the tax cut could be appropriately financed.
— The plan would also lead to a 29% larger capital stock, 6.5% higher wages, and 5.3 million more full-time equivalent jobs.
– The plan would cut taxes and lead to higher after-tax incomes for taxpayers at all levels of income.
— So even assuming strong economic growth, the Trump plan would lose more than $10 trillion over a decade.
How will Trump balance the budget? Keep in mind, also, that the Tax Foundation tried to model Trump’s unspecified base broadening and makes a best estimate. Likewise, the analysis “does not take into account the fiscal or economic effects of interest on debt.” And as I said in my previous blog post, Trump wants to leave entitlements alone, so he would focus his spending cuts on cutting waste, fraud, and abuse elsewhere. Yet the annual revenue loss from the Trump plan about equals the entire discretionary budget, including defense. It can’t all be waste, fraud, and abuse. And note in the Tax Foundation chart, above, that personal tax cuts cause the biggest revenue loss. So Trump doesn’t even get the most bang from his tidal wave of red ink — to mix metaphors. This is not a serious plan.
Links and quotations for September 29, 2015: VW and a new whistleblower era, Fiorina says ‘ditch the flip phone,’ and more
As written in the Harvard Business Review, after the VW emissions scandal and thanks to the power of social media, it will become a “fool’s errand” to “[bet] billions on the stupidity of one’s customers.” That, why Carly Fiorina is urging you to update your mobile phone, and more.
Why Carly Fiorina wants you to ditch your flip phone- RealClearTech/Yahoo Tech
Narendra Modi, Indian Prime Minister, Conquers Silicon Valley – NY Times
“Companies Don’t Go Global, People Do”: An Interview with Andy Molinsky – HBR “I want people to know that this isn’t rocket science.”
Female shoppers no longer trust ads or celebrity endorsements – FastCompany – “These changes in women’s buying behaviors matter because, the report estimates, they control 85% of all purchasing decisions in America, comprising a $14 trillion market.”
Are You Ready for a Robot Colleague? – MIT Tech Review – “…it isn’t only workers who will interact with the robots, and customer behavior can be tricky to predict. The original design for the robot was humanoid, Ritchie says, but user testing showed this unnerved some people. ‘If you make it too human, people will resist it,’ he says. ‘Now it looks more like a friendly Dalek.’”
Should Scientific Truth Be Subjected to a Vote? – RealClearScience –
The idea is that scientific consensus, like aces, always trumps. If “scientists all agree,” then one had better not disagree. But the view that scientific truth is a matter of consensus, expedient though it may be – for politicians and pundits no less than scientists themselves – is misleading at best. Appeals to “consensus” often reflect a simplistic picture of scientific inquiry that purports to end the need for critical reflection, much less debate, on the part of non-scientists.
Shell Didn’t Quit Alaska Out of the Goodness of Its Heart – Wired
Where Shell (and other companies) saw opportunity, environmentalists saw disaster. A spill in the Arctic would be nearly impossible to clean up. …For this reason (and other, probably obvious ones), environmentalists put up a big fight. The ensuing restrictions means Shell spent a lot of their $7 billion Alaskan budget before a single drill bit touched dirt. The company had to conduct tons of research so they could write up their specific exploration plan. Then they went through environmental reviews. And that’s not even counting the cost of the drilling permits.
Is VW’s Fraud the End of Large-Scale Corporate Deception? – HBR
Consider “digital due diligence” emerging as a new normal for the sharing economy. “Analytic activism” and “computational consumerism” become a swipe away.
In fact, all the technical, social, and economic incentives and ingredients exist to cost-effectively deter, dissuade, and detect dishonest behavior by auto manufacturers worldwide. What’s missing is the cohesion necessary to do it. It’s unlikely that automakers will jump into this role. As Dan Neil, The Wall Street Journal’s excellent automobile reviewer says: “Trust no one.”
Regulators and litigators, take note: Your roles will increasingly involve inviting, inspecting, and adjudicating performance analytics submitted by networked citizen scientists and activists. As social media, disposable sensors, smarter phones, machine learning platforms, savvy consumer activists, self-quantification and the “internet of things” accelerate into the economic mainstream, betting billions on the stupidity of one’s customers becomes a fool’s errand.
Consequently, I believe Volkswagen’s debacle signals the likely end of an era of deliberate corporate malfeasance at scale.