894 Posts Found

When there are unpredictable interdependencies, the integrated player is going to win… If I know what to spec, and I can measure it, and there are no unpredictable interdependencies between what you do and what I must do in response, then an economist would say that is sufficient information for a market to emerge between you and me.

Content: Quotation | Author: Clayton M. Christensen | Source: strategy+business | Subject: Economics

This note accompanies the Cross‐country Historical Adoption of Technology (CHAT) dataset. CHAT is an unbalanced panel dataset with information on the adoption of over 100 technologies in more than 150 countries since 1800. The data is available for download at [ Read more ]

Content: Online Resource | Authors: Bart Hobijn, Diego Comin | Sources: Harvard Business School (HBS), National Bureau of Economic Research (NBER) | Subjects: Economics, IT / Technology / E-Business, Reference / Search

Profit is not the proper end and aim of management. It is what makes all the proper ends and aims possible.

Content: Quotation | Author: David Packard | Source: strategy+business | Subjects: Business Rules, Capitalism, Management

Universities can help boost a mature industrial economy by reinvigorating the flow of new ideas in the community. But universities can approach this task in different ways, each leading to vastly different outcomes.

Content: Article | Author: Sean C. Safford | Source: Capital Ideas | Subject: Economics

In a fascinating in-depth interview with John Authers, 85-year old mathematician Benoit Mandelbrot discusses his now 40-year old groundbreaking critique of the “efficient markets” hypothesis and why new theories on price movement discontinuities are needed after the credit crunch. [Hat Tip to FinanceProfessor.com]

Editor’s Note: there are two parts to this video so after watching the first wait for the second to automatically load and begin … [ Read more ]

Content: Multimedia Content | Author: Benoit B. Mandelbrot | Source: Financial Times | Subjects: Economics, Finance

Countless hours have been spent by stock market investors researching the historic performance of the S&P 500 stock market index but until now, they’ve had to slog through spreadsheets or go datamine other reams of data to be able to extract the data they’re after, and that’s before doing any number crunching! Now however, everything has changed because we here at Political Calculations are putting … [ Read more ]

Content: Online Resource | Source: Political Calculations | Subjects: Economics, Finance, Free Stuff / Tools, Reference / Search

The head of Behavioural Finance at Barclays Wealth says hot-brained humans often buy and sell right when they shouldn’t.

Content: Multimedia Content | Author: Greg Davies | Source: The Economist | Subjects: Economics, Finance

Employment growth is strongly predicted by smaller average establishment size, both across cities and across industries within cities, but there is little consensus on why this relationship exists. Traditional economic explanations emphasize factors that reduce entry costs or raise entrepreneurial returns, thereby increasing net returns and attracting entrepreneurs. A second class of theories hypothesizes that some places are endowed with a greater supply of entrepreneurship. … [ Read more ]

Content: Article | Authors: Edward L. Glaeser, Giacomo A.M. Ponzetto, William R. Kerr | Source: Harvard Business School (HBS) | Subjects: Economics, Entrepreneurship

The Mises Institute plays the role of free market defender in a response piece to a person who does not favor free market responses. [Hat tip to FinanceProfessor.com]

Content: Article | Author: Thomas E. Woods Jr. | Source: Ludwig von Mises Institute | Subject: Economics

The world is not facing another Great Depression, says the noted economic historian, but the Federal Reserve is eroding its credibility.

Content: Thought Leader | Authors: Allan Meltzer, Rob Norton | Source: strategy+business | Subject: Economics

Too much and too long, we seem to have surrendered community excellence and community values in the mere accumulation of material things. Our gross national product, now, is over eight hundred billion dollars a year, but that GNP – if we should judge America by that – counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks … [ Read more ]

Content: Quotation | Subjects: Economics, Social Responsibility (ESG)

The previous round of wealth in this economy was built on selling precious copies, so the free flow of free copies tends to undermine the established order. If reproductions of our best efforts are free, how can we keep going? To put it simply, how does one make money selling free copies? Kevin Kelly has an answer: When copies are free, you need to sell … [ Read more ]

Content: Article | Author: Kevin Kelly | Subject: Economics

Differing beliefs lead to price drift: The standard view of how stock prices move—that investors act rationally on information and that markets are efficient—does not account for price drift. Snehal Banerjee explains that price drift may occur because investors agree to disagree about the average valuation of an asset.

Content: Article | Authors: Ilan Kremer, Ron Kaniel, Snehal Banerjee | Source: Kellogg Insight | Subjects: Economics, Finance

There are essentially two economic models for a company today. The first is a conventional consumerist approach, offering goods and services with no engagement other than producing and marketing. This consumerist model has encouraged a passive relationship with consumers; people expect products and services to be delivered, purely in exchange for money, with no effort or engagement on the individual’s part.

But the most attractive products … [ Read more ]

Content: Quotation | Author: Tim Brown | Source: strategy+business | Subjects: Business Plans, Economics

Chris Anderson’s book, “Free: The Future of a Radical Price,” is essentially an extended elaboration of Stewart Brand’s famous declaration that “information wants to be free.” The digital age, Anderson argues, is exerting an inexorable downward pressure on the prices of all things “made of ideas.” Anderson does not consider this a passing trend. Rather, he seems to think of it as an iron law: … [ Read more ]

Content: Article | Author: Malcolm Gladwell | Source: The New Yorker | Subjects: Economics, IT / Technology / E-Business

At the heart of the laissez-faire theory is the idea of rational economic actors maximizing their utility by freely choosing among alternatives. From this core premise, theorists posit that all private choices are free of coercion, since the actor is always free to choose another course. In the purest Chicago version of the theory, the only force that interferes with the magnificent, optimizing process is … [ Read more ]

Content: Quotation | Author: Robert Kuttner | Source: European Business Forum (EBF) | Subject: Economics

In concluding that only systematic risk matters, finance theory assumes that frictions in capital markets are negligible. The absence of frictions implies that all market participants become as costlessly and equally informed as everyone else — that is, no individual is more informed than others or, to use a technical term, there is no information asymmetry. This assumption, combined with several other assumptions, implies … [ Read more ]

Content: Quotation | Authors: David Phillips, Philip Wright | Source: European Business Forum (EBF) | Subjects: Economics, Finance

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Findings from behavioral organization theory, behavioral decision theory, survey research, and experimental economics leave no doubt about the failure of rational choice as a descriptive model of human behavior. But this does not mean that people and their politics are irrational. Bounded rationality asserts that decision makers are intendedly rational; that is, they are goal oriented and adaptive, but because of human cognitive and emotional … [ Read more ]

Content: Article | Author: Bryan D. Jones | Subject: Economics

One of the root problems with business schools is that too many are infected with assumptions that reinforce and bring out the worst in human-beings. In particular, the logic and discipline of economics usually rules the roost at business schools.

Editor’s Note: The comments add as much or more value as the article itself.

Content: Article | Author: Robert I. Sutton | Source: Harvard Business School (HBS) | Subjects: Economics, Ethics