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jerryking : feedback_loops   5

Start Spreading the News: Digital Fuels Superstar Cities - CIO Journal. WSJ
Dec 29, 2017 | WSJ | By Irving Wladawsky-Berger.

Superstar companies are primarily driven by economies of scale, generally achieved through platforms and network effects. Whenever a product, service or process is captured in software and digitized, it becomes digital capital and the economics of abundance take over. The more products or services a platform offers, the more users it will attract, helping it then attract more offerings from ecosystem partners, which in turn brings in more users.....The result is that a small number of companies become category kings dominating the rest of their competitors in their particular market – the Facebooks, Googles, Twitters, Ubers and AirBnbs. Category kings generally take over 70 percent of the total market value in their category, leaving everyone else to split the remaining 30 percent.

“Cities have been caught up in this winner-take-all phenomenon, too,” noted Mr. Florida. “Just as the economy confers disproportionate rewards to superstar talent, superstar cities… similarly tower above the rest. They generate the greatest levels of innovation, control and attract the largest shares of global capital and investment.”

Network dynamics apply to cities just as they do for companies and talent. “They have unique kinds of economies that are based around the most innovative and highest value-added industries, particularly finance, media, entertainment and tech; businesses in superstar cities are formed and scaled up more quickly. All of this attracts still more industries and more talent. It’s a powerful, ongoing feedback loop that compounds the advantages of these cities over time.”

But, such a concentration of talent, wealth and economic activity in fewer and fewer places has led to what a recent Economist issue called the changing economies of geography, the rising inequalities between a relatively small number of superstar cities and the many towns and regions that have been left behind by technology and globalization.
Irving_Wladawsky-Berger  cities  winner-take-all  platforms  superstars  network_effects  disproportionality  geographic_concentration  geographic_inequality  feedback_loops  compounded  increasing_returns_to_scale  digitalization 
january 2018 by jerryking
Isabel Wilkerson Reflects on the Black Lives Matter Movement
January 05, 2015 | | Essay by Isabel Wilkerson.
Where Do We Go From Here?:

The outcomes in Staten Island and Ferguson and elsewhere signal, as in the time of Jim Crow, that the loss of Black life at the hands of authorities does not so much as merit further inquiry and that the caste system has only mutated with the times.From this, we have learned that the journey is far from over and that we must know our history to gain strength for the days ahead. We must love ourselves even if—and perhaps especially if—others do not. We must keep our faith even as we work to make our country live up to its creed. And we must know deep in our bones and in our hearts that if the ancestors could survive the Middle Passage, we can survive anything.
African-Americans  authors  Black_Lives_Matter  digital_advocacy  feedback_loops  Great_Migration  internal_migration  Isabel_Wilkerson  Jim_Crow  journalists  protests  protest_movements  Reconstruction  the_South  women 
may 2015 by jerryking
The Dangers and Opportunities in a Crisis
October 7, 2012 | | By HUGO DIXON, Hugo Dixon is the founder and editor of Reuters Breakingviews.

Wherever one turns — politics, business, medicine, ecology, psychology, virtually every field of human activity — people talk about crises. But what are they, how do they develop and what can people do to change their course?

The first thing to say is that a crisis is not just a bad situation. When the word is used that way, it is devalued. The etymology is from the ancient Greek: krisis, or judgment. The Greek Orthodox Church uses the term when it talks about the Final Judgment — when sinners go to hell, but the virtuous end up in heaven. The Chinese have a similar concept: The characters for crisis combine parts of those for danger and opportunity.

A crisis is a point when people have to make rapid choices under extreme pressure, normally after something unhealthy has been exposed in a system. To use two other Greek words, one path can lead to chaos; another to catharsis or purification.

A crisis is certainly a test of character. It can be scary. Think of wars; environmental collapses that destroy civilizations of the sort charted in Jared Diamond’s book “Collapse: How Societies Choose to Fail or Succeed”; mass unemployment; or individual depression that leads to suicide.

But the outcome can also be beneficial. This applies whether one is managing the aftermath of the Lehman Brothers bankruptcy, the current euro crisis, the destruction of an oil rig in the Gulf of Mexico or an individual’s midlife crisis. Much depends on how the protagonists act.

Students of crises are fond of dividing them into phases. For example, Charles Kindleberger’s “Manias, Panics, and Crashes: A History of Financial Crises” identifies five phases of a financial crisis: an exogenous, normally positive, shock to the system; a bubble in which people exaggerate the benefits of that shock; distress when some investors realize that the game cannot last; the crash; and finally a depression.

Although there is much to commend in Mr. Kindleberger’s system, it is too rigid to account for all crises in all fields. It also downplays the possibility that decision makers can change the course of a crisis. A more flexible scheme that leaves space for human agency to affect how events turn out has just two phases: the bubble and the crash......The bubble is typically characterized by mania and denial. Things are going well — or, at least, appear to be. Feedback loops end up magnifying confidence...............Manic individuals do not know their limitations and end up taking excessive risks — whether on a personal level or in managing an organization or an entire economy. As the ancient Greeks said, hubris comes before nemesis........But before that, there is denial. People do not wish to recognize that there is a fundamental sickness in a system, especially when they are doing so well........The ethical imperative in this phase is to *burst the bubble before it gets too big*. That, in turn, means both being able to spot a bubble and having the courage to stop the party before it gets out of hand [JCK: courage = "political will"] . Neither is easy. It is hard to recognize a sickness, given that there is usually some ideology that explains away the mania as a new normal. The few naysayers can be ridiculed by those who benefit from the continuation of the status quo.

What is more, politicians, business leaders and investors rarely have long-term horizons. So even if they have an inkling that things are not sustainable, they may still have an incentive to prolong the bubble.......The crash, by contrast, is characterized by panic and scapegoating. People fear that the system could collapse. Negative feedback loops are in operation: The loss of confidence breeds further losses in confidence. This is apparent on an individual level as much as on a macro one.

..Events move extremely fast, and decisions have to be made rapidly........The key challenge is to make effective decisions that avoid vicious spirals while not embracing short-term fixes that fail to address the fundamental issues. With the euro crisis, for example, it is important to improve competitiveness with structural reforms and not just rely on liquidity injections from the European Central Bank.[JCK: "structural change"]

In this phase, no one denies that there is a problem. But there is often no agreement over what has gone wrong. Protagonists are reluctant to accept their share of the responsibility but instead seek to blame others. Such scapegoating, though, prevents people from reforming a system fundamentally so that similar crises do not recur.[JCK: "systemic change"].....Crises will always be a feature of life. The best that humanity can do is to make sure it does not repeat the same ones. And the main way to evolve — both during a bubble and after a crash — is to strive to be honest about what is sick in a system. That way, crises will not go to waste.
blaming_fingerpointing  books  bubbles  catharsis  chaos  character_tests  clarity  crisis  dangers  decision_making  denials  economic_downturn  feedback_loops  Hugo_Dixon  individual_agency  Jared_Diamond  manias  market_crash  new_normal  opportunities  overconfidence  political_will  risks  scapegoating  short-sightedness  societal_choices  speed  structural_change  systemic_change  systemic_risks 
february 2015 by jerryking
Bar is high for Carney on world stage
Apr. 18 2013| The Globe and Mail |CHRYSTIA FREELAND.

One of the analytical mistakes made before the financial crisis was to believe that efficient markets were perfect and that private bankers could police themselves. Refreshingly, Mr. Carney isn’t making the same error in reverse. He is a believer in regulation and has embraced it at its most complex, global, scale.

But he said regulators need to be watchful of the unintended consequences of their rules and mindful of the feedback loops between their actions and private markets. The relationship between markets and governments is a complicated process that requires eternal vigilance and constant tweaks.
Chrystia_Freeland  Mark_Carney  central_banking  central_banks  regulators  feedback_loops  unintended_consequences  world_stage 
april 2013 by jerryking
Op-Ed Columnist - Our Three Bombs -
October 6, 2009 | New York Times | By THOMAS L. FRIEDMAN. "As
we continue to build up carbon in the atmosphere to unprecedented
levels, we never know when the next emitted carbon molecule will tip
over some ecosystem and trigger a nonlinear climate event....people are
worried that our next dollar of debt — unbalanced by spending cuts or
new tax revenues — will trigger a nonlinear move out of the dollar and
torpedo the U.S. currency."

If people lose confidence in the dollar, we could enter a feedback loop,
as with the climate, whereby the sinking dollar forces up interest
rates, which raises the long-term cost of servicing our already massive
debt, which adds to the deficit projections, which further undermines
the dollar.
Tom_Friedman  climate_change  nonlinear_systems  debt  step_change  tipping_points  apocalypses  feedback_loops  interest_rates  discontinuities  think_threes 
october 2009 by jerryking

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