Month: August 2017

Shtetl-Optimized » Blog Archive » The Kolmogorov option

Source: Shtetl-Optimized » Blog Archive » The Kolmogorov option

It seems likely that in every culture, there have been truths, which moreover everyone knows to be true on some level, but which are so corrosive to the culture’s moral self-conception that one can’t assert them, or even entertain them seriously, without (in the best case) being ostracized for the rest of one’s life.

Does this mean that, like Winston Smith, the iconoclast simply must accept that 2+2=5, and that a boot will stamp on a human face forever? No, not at all. Instead the iconoclast can choose what I think of as the Kolmogorov option. This is where you build up fortresses of truth in places the ideological authorities don’t particularly understand or care about, like pure math, or butterfly taxonomy, or irregular verbs. You avoid a direct assault on any beliefs your culture considers necessary for it to operate. You even seek out common ground with the local enforcers of orthodoxy. Best of all is a shared enemy, and a way your knowledge and skills might be useful against that enemy. … Meanwhile, you wait for a moment when, because of social tectonic shifts beyond your control, the ruling ideology has become fragile enough that truth-tellers acting in concert really can bring it down. You accept that this moment of reckoning might never arrive, or not in your lifetime. But even if so, you could still be honored by future generations for building your local pocket of truth, and for not giving falsehood any more aid or comfort than was necessary for your survival.

Hilbert said that science, unlike religion, has no need for martyrs, because it’s based on facts that can’t be denied indefinitely.
…
There’s a quiet dignity to Kolmogorov’s (and Galileo’s) approach: a dignity that I suspect will be alien to many, but recognizable to those in the business of science.

Is America Encouraging the Wrong Kind of Entrepreneurship?

Source: Is America Encouraging the Wrong Kind of Entrepreneurship?

In a 1990 paper, “Entrepreneurship: Productive, Unproductive, and Destructive,” Baumol argued that the level of entrepreneurial ambition in a country is essentially fixed over time, and that what determines a nation’s entrepreneurial output is the incentive structure that governs and directs entrepreneurial efforts between “productive” and “unproductive” endeavors.

we and others have documented a pervasive decline in the rate of new firm formation during the last three decades and an acceleration in that decline since 2000. In fact, we found that by 2009 the rate of business closures exceeded the rate of business births for the first time in the three-decades-plus history of our data. This decline in startup formation has occurred in each state and nearly all metropolitan areas, and in each broad industrial sector, including high tech. There has also been a slowdown in activity of high-growth firms, the relatively small number of businesses that account for the lion’s share of net job gains. All of this points to a slowdown in the growth of productive entrepreneurship.

What about the other kind of entrepreneurship? Do we also see a rise in unproductive entrepreneurship, as Baumol theorized?

We don’t have a smoking gun to confirm this hypothesis, but there surely is smoke, and it comes in two forms: rising profits, especially those earned by the largest businesses in the economy, and suggestive evidence of an increase in efforts to shape the rules of the game. This pattern is consistent with the rise of economic rents and rent-seeking behavior.

How Amazon’s Accounting Makes Rich People’s Income Invisible – Evonomics

Increasingly, businesses don’t generate profits. They generate capital gains. It’s fiendishly clever.

Source: How Amazon’s Accounting Makes Rich People’s Income Invisible – Evonomics

Half a trillion dollars in revenues.

Essentially zero profits. Ever.

Dollars delivered onto investors’ balance sheets? Somewhere north of 300 billion.

none of that shareholder income ever appears as household income in the national accounts