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jerryking : james_surowiecki   19

The Widening Racial Wealth Divide
OCTOBER 10, 2016 ISSUE | - The New Yorker | By James Surowiecki
THE WIDENING RACIAL WEALTH DIVIDE
It would take black Americans two hundred and twenty-eight years to have as much wealth as white Americans have today.

As Thomas Shapiro, a sociologist at Brandeis and the co-author of the seminal book “Black Wealth/White Wealth,” told me, “History and legacy created the racial gap. Policies have maintained it.” Together, they contribute to what he’s called “the hidden cost of being African-American.”

Start with history. Beginning in the New Deal and on into the postwar years, the federal government invested heavily to help ordinary Americans buy homes and go to school, via programs like the Federal Housing Administration and the G.I. Bill. That fuelled an economic boom and fostered the growth of a prosperous middle class. But black Americans received little of this assistance. Redlining by banks and by government agencies prevented black families from buying homes in white neighborhoods; in a thirty-year period, just two per cent of F.H.A. loans went to families of color. G.I. Bill benefits went disproportionately to white veterans. Black agricultural and domestic workers were excluded from Social Security until the fifties. As Dedrick Asante-Muhammad, the co-author of the CFED/I.P.S. report, told me, “Massive government investment helped create an American middle class. But it was a white American middle class.”
racial_disparities  James_Surowiecki  race  African-Americans  redlining  discrimination  generational_wealth  racism  education  housing  intergenerational  New_Deal  wealth_creation  home_ownership  books  post-WWII 
october 2016 by jerryking
Twilight of the Brands
FEBRUARY 17 & 24, 2014 | - The New Yorker | BY JAMES SUROWIECKI.

** “Absolute Value,” by Itamar Simonson and Emanuel Rosen,

It’s a truism of business-book thinking that a company’s brand is its “most important asset,” more valuable than technology or patents or manufacturing prowess. But brands have never been more fragile. The reason is simple: consumers are supremely well informed and far more likely to investigate the real value of products than to rely on logos. “Absolute Value,” a new book by Itamar Simonson, a marketing professor at Stanford, and Emanuel Rosen, a former software executive, shows that, historically, the rise of brands was a response to an information-poor environment. When consumers had to rely on advertisements and their past experience with a company, brands served as proxies for quality; if a car was made by G.M., or a ketchup by Heinz, you assumed that it was pretty good. It was hard to figure out if a new product from an unfamiliar company was reliable or not, so brand loyalty was a way of reducing risk. As recently as the nineteen-eighties, nearly four-fifths of American car buyers stayed loyal to a brand.

Today, consumers can read reams of research about whatever they want to buy. This started back with Consumer Reports, which did objective studies of products, and with J. D. Power’s quality rankings, which revealed what ordinary customers thought of the cars they’d bought. But what’s really weakened the power of brands is the Internet, which has given ordinary consumers easy access to expert reviews, user reviews, and detailed product data, in an array of categories.
Achilles’_heel  books  brands  Consumer_Reports  customer_loyalty  decline  fragility  GM  information-poor  information-rich  J.D._Power  James_Surowiecki  Kraft_Heinz  Lululemon  new_products 
february 2016 by jerryking
The Shake Shack Economy - The New Yorker
JANUARY 26, 2015 ISSUE

The Shake Shack Economy
BY JAMES SUROWIECKI

Unlike traditional fast-food restaurants, fast-casuals emphasize fresh, natural, and often locally sourced ingredients. (Chipotle, for instance, tries to use only antibiotic-free meat.) Perhaps as a result, their food tends to taste better. It’s also more expensive. The average McDonald’s customer spends around five dollars a visit; the average Chipotle check is more than twice that. Fast-casual restaurants first emerged in serious numbers in the nineteen-nineties, and though the industry is just a fraction of the size of the traditional fast-food business, it has grown remarkably quickly. Today, according to the food-service consulting firm Technomic, it accounts for thirty-four billion dollars in sales. Since Chipotle went public, in 2006, its stock price has risen more than fifteen hundred per cent.

The rise of Chipotle and its peers isn’t just a business story. It’s a story about income distribution, changes in taste, and advances in technology. For most of the fast-food industry’s history, taste was a secondary consideration.
fast-casual  food  globalization  James_Surowiecki  shifting_tastes  entrepreneur  Danny_Meyer  Panera  Chipotle  fast-food  income_distribution  Shake_Shack 
january 2015 by jerryking
James Surowiecki: The Startup Mass Extinction : The New Yorker
BY JAMES SUROWIECKI
MAY 19, 2014

"Starting a company may be easier, but making it a success isn’t. Competition is fierce, profits are scarce, and venture capitalists aren’t generous when it comes to later stages of funding. As Gideon Lewis-Kraus shows in “No Exit,” a new Kindle Single about startup culture, the life of a new company is often brutish and short. Though we may be seeing a “Cambrian explosion” of new companies, as The Economist recently put it, there’s a mass extinction going on, too.

The fact that most new businesses fail is hardly a secret. So why are so many people gambling on ventures that are likely to end badly?
start_ups  biases  overconfidence  failure  James_Surowiecki  new_businesses  Cambrian_explosion 
june 2014 by jerryking
James Surowiecki: America’s History of Industrial Espionage
JUNE 9, 2014 | The New Yorker | BY JAMES SUROWIECKI

One of these artisans was Samuel Slater, often called “the father of the American industrial revolution.” He emigrated here in 1789, posing as a farmhand and bringing with him an intimate knowledge of the Arkwright spinning frames that had transformed textile production in England, and he set up the first water-powered textile mill in the U.S. Two decades later, the American businessman Francis Cabot Lowell talked his way into a number of British mills, and memorized the plans to the Cartwright power loom. When he returned home, he built his own version of the loom, and became the most successful industrialist of his time.

The American government often encouraged such piracy. Alexander Hamilton, in his 1791 “Report on Manufactures,” called on the country to reward those who brought us “improvements and secrets of extraordinary value” from elsewhere. State governments financed the importation of smuggled machines. And although federal patents were supposed to be granted only to people who came up with original inventions, Ben-Atar shows that, in practice, Americans were receiving patents for technology pirated from abroad.

Piracy was a big deal even in those days. Great Britain had strict laws against the export of machines, and banned skilled workers from emigrating. Artisans who flouted the ban could lose their property and be convicted of treason.
Alexander_Hamilton  China  copycats  espionage  history  industrial_espionage  Industrial_Revolution  intellectual_property  James_Surowiecki  security_&_intelligence 
june 2014 by jerryking
12.11: The Decline of Brands
November 2004 | Wired |By James Surowiecki.

Americans have become less loyal. Consumer-goods markets used to be very stable. If you had a set of customers today, you could be pretty sure most of them would still be around two years, five years, ten years from now. That's no longer true. A study by retail-industry tracking firm NPD Group found that nearly half of those who described themselves as highly loyal to a brand were no longer loyal a year later.

Sure, there are more brands than ever. But they're taking a beating - or, even worse, being ignored. Who's to blame? A new breed of hyperinformed superconsumers. (That's right - you!)
James_Surowiecki  brands  branding  decline 
july 2012 by jerryking
Can Small Businesses Make America Prosperous? :
October 31, 2011| The New Yorker | by James Surowiecki.

There's an ongoing veneration of small business...But the truth is that, from the perspective of the economy as a whole, small companies are not the real drivers of growth....small businesses are, on the whole, less productive than big businesses, and though they do create most jobs, they also destroy most jobs, since, while starting a business is easy, keeping it going is hard....in the U.S. the connection between size and productivity is, as a 2009 study showed, especially close. In part, this is because big businesses are able to enjoy economies of scale and scope. Big businesses are also better able to make investments in productivity-enhancing technologies and systems; in the U.S., for instance, big companies account for the vast majority of R. & D. spending....It’s harder for small businesses to innovate in these ways, particularly when credit is tight, as it is now. More important, most small businesses aren’t necessarily interested in expanding or innovating. A recent study by the economists Erik Hurst and Benjamin Pugsley shows that only a tiny fraction of small-business owners have any interest in becoming big-business owners, or even in bringing a new idea to market. Most are people who simply want to run a small company, do work they enjoy, and have some control over their own financial lives.

Those are admirable goals, but they’re not going to make companies more productive....greater productivity is the main driver of long-term economic growth and higher living standards.
small_business  James_Surowiecki  productivity  owners  myths  illusions  large_companies  economies_of_scale  economies_of_scope  managerial_preferences 
october 2011 by jerryking
The Billion Prices Project and the Value of Data
May 30, 2011. | : The New Yorker | by James Surowiecki. A new
venture called the Billion Prices Project may help change that. The
B.P.P., which was designed by the M.I.T. economists Alberto Cavallo and
Roberto Rigobon, gathers price data not via survey but, rather, by
continuously scouring the Web for prices of online goods around the
world. (In the U.S., it collects more than half a million prices
daily—five times the number that the government looks at.) Using this
information, Cavallo and Rigobon have succeeded in building what amounts
to the first real-time inflation index. The B.P.P. tells us what’s
happening now, not what was happening a month ago.

Read more
http://www.newyorker.com/talk/financial/2011/05/30/110530ta_talk_surowiecki#ixzz1NAObusGP
James_Surowiecki  data  economy  economics  inflation  CPI  statistics  MIT  pricing  digital_economy  massive_data_sets 
may 2011 by jerryking
James Surowiecki on Financial Illiteracy - NYTimes.com
June 29, 2010, 9:45 am
James Surowiecki on Financial Illiteracy
By FREAKONOMICS
financial_literacy  James_Surowiecki 
november 2010 by jerryking
The Regulation Crisis: A failure of economic and environmental regulation
June 14, 2010 | The New Yorker | by James Surowiecki.
As Carpenter argues in a recent essay, successful regulation, by filling
information gaps and managing risk, fosters confidence in the safety
and honesty of markets, which in turn makes them bigger and more robust.
The pharmaceutical industry, for instance, would be much smaller if
people were seriously worried that they might be poisoned every time
they took a new drug. And though executives chafe at financial
regulation, the protection it provides makes investors far more likely
to hand them money to play with. If we want our regulators to do better,
we have to embrace a simple idea: regulation isn’t an obstacle to
thriving free markets; it’s a vital part of them.
BP  confidence  consumer_protection  economics  environment  financial_regulation  free_markets  information_gaps  investors  James_Surowiecki  oil_spills  pharmaceutical_industry  politics  regulation  regulators  SEC 
june 2010 by jerryking
The European Union rescues Greece and Portugal
May 24, 2010 | The New Yorker | by James Surowiecki. "...The
fact is, this kind of volatility isn’t going away, because we now live
in an environment dominated by what economists call “political risk”—the
uncertainty that businesses face as a result of government actions. Of
course, government actions always affect the economy, but usually in an
undramatic way: an interest-rate cut here, a new regulation there. The
economic downturn and the debt crisis have given us instead a world
where governments are among the most important players in
markets—injecting money into economies on a colossal scale and routinely
propping up, or even nationalizing, troubled companies."
Angela_Merkel  bailouts  central_banks  debt_crisis  economic_downturn  EU  Germany  geopolitical-risk  Greece  IMF  instability  James_Surowiecki  political_risk  Portugal  sovereign-risk  uncertainty  volatility 
may 2010 by jerryking

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