Mercurial

Startups are highly attractive workplaces for some of us, but according to Dharmesh Shah, there is much more to ask when considering joining one:

We come full circle, and become aware, one more, that the product or service we sell is a reflection on our values and attitudes.

Technorati: business , economy,career

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Web 2.0 has jumped the shark. Boris Karadogan published a list of Web 2.0 companies, and in doing that he crushed the hopes of procrastinator entrepreneurs, worried the investors, and started the road to a newer version of web.

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Cedric is pessimistic regarding Ruby and its mainstream acceptance: Why Ruby on Rails won't become mainstream

Let's make an experiment: we know that the cool kids are all trying this now; so, next foo camp, let's check how many of the invitees get there spouting ruby dogma, and how fast it goes.

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I have found the most compelling criteria for finding intelligent life in other universes: you must have cake.
Seriously.
There are various arguments for that, but I like the economic side of it: you are obviously wasting untold resources, same that could be put to clever use, on the immediate satisfaction of a transient desire for immediate gratification. Veblen here I come!
And in doing so, you are showing off both your wealth, your status and your technological prowess: wealth, because it is only through accumulation that you can devote those resources, food and energy, to creating a cake; status, because it is clear (the margins are too small, though) that only those that have certain status can enjoy the best cakes, cheesefactory notwithstanding, and technology, because the creation of the perfect cake demands knowledge and chemistry: just look at your cake and think of all the industrial processes that took place to bring that thing to your table.

The main point here is not that these industrial milestones have been achieved, is that you are using that incredible confectionery industrial complex to satisfy your gluttony. At least the military serve a semi-logical purpose, but cake? There is nothing more superfluous than that.

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In the process of looking for a suitable job, and then getting hired, I find these 25 hurtful words spread all over the place. As Levitt and Morville say, our information has to be findable, and adjectives have become obscuring instead of enlightening.
Much more the better, then, to use real accomplishments to eliminate the hype, convey a message, and reach the reader. It becomes a power game played through information awareness.
If you were writing your personal ad, instead of saying "like to walk on the beach" you would then say "walked on Baker's Beach for five miles over a period of two hours, admired twenty seagulls, picked up two shells, and sprinted into the water five times." See? Definite achievements.

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Do some trading using your computer:

Finally, a way to put all that study about chaos theory to good use.

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Meat grown in huge vats could be a possibility. But really, do we want to have a synthosteak? And what are the energy benefits of such a thing, ie, how much energy goes into it and what goes out of it? And with the recent scandals, how much of chemicals do we really want in our body?
I can think of a thousand more efficient ways of producing high quality protein (OK, only two or three) to feed a huge population, but instead of relying on a centralized distributor of an artificial paste I would focus on the available products from local farms.

I have two questions regarding this homogenized synthomeat: What are going to be the filters that prevent accumulation of toxins in that meat? How are the technicians and corporation using this going to ensure the proper quality of this meat, when they all will be working for a minimum investment and a maximized profit?

God, I am sounding like a Luddite, but the points are relevant. Nowadays we spend incredible amounts of energy raising cattle, in the most inhumane and anti-hygienic conditions possible, only to throw a high percentage of that meat as leftovers and spoiled goods. We are all paying for the externalities of such a gigantic and skewed industry: health problems and environmental pollution, bringing you such beauties as high cholesterol, air pollution, endocrine disruption and antibiotic resistance. Now think that again, but complicated by the fact that the meat doesn't exist anymore within a survival system, ie the cow, but in a tank where all kinds of cheap untested chemicals are going to go, all in the interest of maximizing shareholder value.

Bad idea.

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Ben Hammersley points to the recent Supreme Court decision declaring grokster liable for the file swapping, torture in Abu Ghraib and all ills in the world.
Ben notes that US law may not apply elsewhere in the world, leaving other countries free to apply this technology in whichever way they conceive it is best.

However it is applicable to note that, in the past, countries such as the UK (and perhaps the USA, I don't know) have arrogated upon themselves the right to police and enact laws that might seem unjust in other parts of the world. One example that comes to mind is the old UK Admiralty law that allows the UK to render judgment al over the world on matters maritime (or something to that effect).

So, this is possible, and it has been applied before.

What Ben writes, though, is intrinsically correct: there are a whole lot of other countries out there that might understand that the benefit of having a new technology far outpaces the costly and draconian provisions designed to maintain an obsolete business model and an extremely inefficient industry afloat.

Case in point: we are paying US$20 per CD so Britney can choke herself on cocaine (not that Britney, the other one) and to sustain Dylan's rehab clinic costs. Really, what kind of industry thrives on the self-destructing habits of their stars? What is more, why should I, consumer, pay for that?

Up until very recently the entertainment industry has banked in precious few things: the oligopolic nature of the market, in which a very few companies control the content, the distribution channels.
But this happens because the state of communication on times past allowed only a very few select acts to make it to the fore, and the prohibitive costs of recording, pressing and then pushing through the radio and TV those selected acts meant that, in effect, the barriers to entry were, for all practical purposes, insurmountable: only a company willing to spend millions on a new singer will actually see money coming back to them.

What breaks that model? Well, we have more stars now, ie, less celebrities, and more quacks that display less talent than a band of monkeys. The recording houses have a dizzying array of low quality acts, and keep on publishing even more. Low standards for all, and therefore, discontent disillusioned consumers.

And we got broadband and an amazing way to share, look for, and publish the information that we like. Suddenly, the music industry model became a conversation, an old school market with participating agents and haggling and bargaining.

See, there is no point in trying to push Britney at $20 per CD, while allowing Liz Wright to languish unheard in a corner of the store. We, the audience, will inevitably gravitate towards quality.

Other thing, to which Cory Doctorow was pointing regarding his book and sources of income, is that if distribution of the work is not paid, the artist has to go out there and contact with the public, making the concert the point of confluence of spectators and artist, money coming from the experience of sharing that show with a bunch of other people. We regain the amphitheater, the pack of humans cheering at the artist. It is who we are.

In conclusion, to pretend that a single ruling may obliterate the technological and social pressures that have shaped sharing of content is naïve, harmful and dangerous.
It is naïve, because that is going to proceed no matter what, from corners of the world where simply it is to expensive to send Special Forces or "contractors" and mercenaries.
It is harmful, because it places American technology under the shackles of a few entertainment houses, the same ones that were unable to take advantage of the internet phenomenon, the same ones that eschew technology and place easy profits instead of their consumer. If the Supreme Court limits technological innovation in the USA, rest assured, somebody in Africa, Asia or Latin America is going to come up with the answer for a demand that will only grow.
It is dangerous because, in their zeal to protect the rights to Mickey Mouse, the Court is allowing companies to intrude, invade and trounce upon the rights of citizens - the Court effectively renouncing their role, and becoming facilitators for more invasions of privacy.

And in ten years, we will be seeing the grokster of the time in the stock exchange making a killing. Only that it won't be and American company.

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Small city, big problems when it attempts to grow: Exactly what happened to Krispy Kreme and its financial and operating woes:

The problem that I detect here is that the culture in Winston-Salem, back from the days of RJR, was that of a highly centralized, hierarchical and absolutist decision structure.
This creates an inherent lack of flexibility in the company, as well as allowing for strategic mistakes to appear with more insidiousness.
Within a highly politicized environment in a company, there are many obstacles to information flow, and the feedback from customers and clients is stemmed and redirected, favoring opinions from those in the know, or those that agree with the bog bosses. Lacking a mechanism to ensure a dissenting voice, or a participative culture that encourages discussion and feedback, it is easy to fall into mistakes such as the egregious disregard for the cult status that Krispy Kreme enjoyed for a while.

Within a culture that encourages communication and participation, and a viable, fast channel, these brand crimes would have been all avoided. All this would have meant that an internal blog and wiki would have worked marvels for Krispy Kreme, allowing voices from all levels to reach management and develop a more aware perspective of the whole business that Krispy Kreme was: the doughnut experience, the whole "we make them while you see", an antithesis to the McDonalds, the pumpkin doughnut in the fall, etc.

Of course, a blog by the CEO won't change things. It implies a whole culture change, not just gimmicks and tools, to make that move and ensure that the whole company regains and maintains its status as supplier of deliciousness, but surely a tool that depends on transparency, communication and participation ought to be good for any enterprise.

What would Cooper do if I call him offering to install a blog in that company?

via Kottke

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Acknowledged. Being in charge is costly:

This is perfect territory for social software solutions to manage that flow of information, foster creativity and transparency, ensure accountability and maintain accurate records and allow agile, fast control over changes, modifications, policies and movements within the normal procedures of a company.
Whether this is achieved with enterprise applications worth 2 million dollars, or with Open Source implementations of similar characteristics, seems to be immaterial. We are going to see an explosion of this kind of software, and a huge need for people with that particular kind of knowledge and a broad vision of the entire workings of a company, its needs and a clear understanding of its culture. This is going to be a must for any company that desires to remain competitive.

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On the oncoming energy wars, check the McKinsey’s article about Asia's energy future needs:

This new increased demand implies new technologies, improved efficiencies and major spending on alternatives.

It also means that there is going to surface a new culture of energy frugality, as with such a big competition it is clear that energy prices will simply go up. What on consumption and manufacturing trends? Will it actually make it better for knowledge workers, and restrict ownership of consumer goods to those that can afford them? A country with less SUVs and more public urban transportation means also a more aggregated population, and a shift toward cheaper food alternatives. Subsidizing meat is already expensive, but with duplicated gas prices this becomes almost untenable. Changes in diet, as well?

And, if there is a migration, it is going to be toward medium size centers, which would afford the possibility of great market and aggregation, while maintaining a human scale to allow both transactions and communications without resorting to use of fuel energy. Miami becomes too big for its own good, and Kernersville can not justify the cost of bringing in that Italian magazine.

Commuting habits change: the knowledge worker can stay longer at home (assuming there's no significant increase in communications costs), and the production occurs within close distance, in the ideal case.

More bike riding. That's for sure.

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I am waiting for airlines to start in-flight advertising, such and such flight sponsored by corporatiosn and the like, and a "reserved seat".
Imagine: Your favorite window seat with lots of leg room sponsored by Starbucks, with logo and all.
It works for other forms of mass transit.

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Fast Company points to Teresa Amabile, from the Entrepreneurial Management Unit at HBS, whose research focus on creativity; sadly for the advocates of death marches and non-compensated overtime, her study suggests that creativity, and by extension, economic life, comes from working on a safe environment, with proper rewards and certainty.
In particular, the piece on FC centers on six myths of creativity, arguing that the following actually hinder the creative process: money, time pressure, fear, competition, downsizing, and the belief that only a few are creatively gifted.
This runs contrary to all our beautiful corporate credos, that by the most part stimulate by fear and pain, run employees against one another through brutal office politics, bring in "star employees" instead of relying in the collective knowledge of the company, and continuously demoralize their working force by subjecting them to the uncertainty of sudden layoffs and incredibly rigid hierarchical structure.
As a result, a corporation that is so rigid and devoid of creative thinking soon becomes a dealer of commodities, since products and services that are not unique become immediately undistinguishable from those of the competition. Hence, their price plummets and the company becomes a target for competitors for overseas and the like.
OK, this is extremely oversimplifying, but choke on this: IBM redraw itself as a provider of services, high aggregated value items that only IBM can provide, and stopping its PC arm: it is not about selling bread, but by providing the service, the unique experience that differentiates and provides an ample margin that allows the company to thrive amidst heavy competition and uncertain economic times.

While looking about this article, I found this blog, with six important concepts to take in to account, and that may foster the creative process. Funny that Amabile's ideas travel in groups of six.

Posted by manino at 2:17 PM | Permalink | Comments (1) | TrackBacks (1)

Economies of un-scale

But they are making everything available - only information. What about these other things that actually require of a sufficiently high amount of consumers? Do we still get these? Do we count on distribution channels so powerful as to send us, say, our last car, our last computer? are we able to demand exactly what we want out of concrete things, the ones that are most costly to transport through ordinary mail?
Problem: shipping goods to places where people might want them. Hurdles: oil prices (energy), time to transport those, warehousing, delivery - those area all activities that demand a group of people. remember Webvan and its desire to sell to people goods that had to be physically handled and packaged by their employees (unlike ebay). Then why netflix or amazon survive? Because of the minimal size of the DVDs? Information, Chris Anderson explains, is easily un-scaled, thus making it available without the dreadful constraint of diminishing margins. In other words, technology proving itself as being impervious to that ubiquitous decreasing marginal returns.

Bulk shipping - is it amenable to unscale economies? And what happens as oil prices go higher? What happens when our exponential growth curve faces its impossible limitations, if any?

It is Monday. Might as well think.

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The Monetary Economics of Thurston Howell III delas with our perception of the validity of currency:

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Why Amazon hates Spanish speaking people? We are the third most spoken language in the world, there are about 400 million of us, and there are at least 32 million of us here in the US, making this the third country, in number of people that identify Spanish as their mother language, after Mexico and Colombia.

Yet when I want to buy a book in Spanish, the all famous Good to Great, I cannot find it at Amazon. I have to go to Norma, and try to get it from there.

Now, don't get me wrong, I think it amazing that Norma is actually selling everywhere, but really, is so a pain in the ass to try to get things through other channels, whereas it is so evident and obvious that Amazon should be getting its ass in gear and pushing books to the millions - read, millions - of Spanish speakers in this country.

Jeff Bezos, are you reading? Millions!

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JK Galbraith on Corporations and War:

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The company where I work laid off a lot, a huge aount of workers.
I feel as if I had been in some battle, one monment talking to some friends, the other they are not there - and there is neither reason nor justice to the way these people lost their jobs. There is no merit in surviving in that place, just a sense of loss and alienation, as we all talk subduedly about it, or go after drinks, or simply react in our individual ways to those news.
In hindsight, the signs were there: new top managers in, projects on hold, Fortune and Forbes being extremely critical. Yet, of course, I don't believe it until it does happen.

At other company, upon hearing that a guy that worked with me was not going to be hired again, I and a coworker went to speak to the division VP. And I think that we managed something positive out of that, the guy that left actually found some other job.

We, the whole group, had about a month to move around, talking to people, starting a network for this guy. Considering possibilities.

Here, it was sudden death. I do feel this extreme and absurd guilt of the one that remains, amind that dull pain, to tell the tale.

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I am skeptical about these virtual corporations being the future of businesses. Outsourcing as a way to define a corporation doesn't seem like a viable, sustainable way of doing things, at least for goods and services that have reached maturity or that can be substituted easily.
True, globalization allows for more and more decentralization, distributed control and access to varied manufacturing facilities. However, it also opens the door, in ways that were not available before, to producers that want to market their own products.

From a producer point of view, the virtual corporation is just another layer in the path to the consumer, an additional expense that, in the case of standard, mature products, is continuously losing its appeal: not only the virtual corporation controls production and exerts veto management, they can shift production and quantities according to their forecast, creating high instability for the producer itself.

The article of the Times talking about Kjell Nordstrom's book simply points out what we already have been experiencing, that as long as the services are standardized they can be exported, Furthermore, the article centers on information economy, a situation in which location is not so relevant.
However, on the tangible product side of the equation, this article forgets about, again, producers of services that require a direct interaction with the customer or goods that are already produced by a multitude of small independent unconnected agents.
In the first case, we resort to the independent agent, which is helped by the ubiquity of internet-related services, viral marketing, heterodox marketing techniques and the particularity of the service they offer. In the second case, the producers are identifying a situation of power in the same markets that the virtual corporations serve: the political, social and financial implications of delivering directly to the target, bypassing the bureaucratic layers of corporations is an environmentally sound idea, has strong appeal with the politicians of the countries that are producers, allow much more profit to reach the producers, and gives control to the owners of the facilities.

Because, all the facts that Nordstrom points about the easiness of virtual corporations can be said in favor of the producers: access to the same management theories, globalization and communication that allow for easy access to information, and a huge pool of workers with a vast knowledge of the functioning of the industrialized world markets.

Thus, producers do not need the virtual corporation anymore, but simply a big distribution channel for their relatively inexpensive and generic products.

Case in point: Wal-Mart as the distributor for countless generic China factories.
Another one: Fair Trade initiatives, offering coffee directly from the producers to the consumers.

In conclusion, it is still some time until the benefits of these reach everybody, but as the producers grow more sophisticated and their knowledge of the world markets mature, their presence is going to be more prevalent, causing a significant shift in trade balance (apparent now) and in division of labor.

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Now a cup of Colombian coffee, directly from the Colombian Coffee Growers Federation, as Kuntzman reports.
There are a certain clarifications in order, though.

The Coffee Growers Federation is far from being a cooperative: it is a private company, founded by the Colombian government back in the time when having a coffee plantation meant money, with the charter to protect the prices and the international market for Colombian coffee.
Its profits have never been distributed to the growers. More to the point, it taxes the growers, using all that money to bail out the government in times of crisis, to fund new initiatives and to pas the nice London apartments of its former director and his two sons, the ministers (As in Secretary of Transportation and Secretary of Finances).

It does not give back to the growers: it takes away from them, and then sells in their "cooperative" stores machinery and capital goods at inflated prices.
It sets up a bank, and then has all taxpayers rescue it from mismanagement; then, it gives loans to coffee growers, with tremendous conditions and loads of red tape. Few make it, you know, because there is a crisis.

And Kuntzman, it is Popayán. Beautiful city, by the way, I know somebody there if you want to go.

The new initiative is good only in that it attempts to eliminate the vicious economic circle that has plagued Latinamerican countries since times immemorial: specializing in first sector goods, selling them without adding any value. At least with this campaign they expect to recap in price what they lost to the aggressiveness of Vietnam efforts.

Let's hope this new enterprise lasts longer, and effectively gives it s benefits to the growers, not to just a few privileged people in office.

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Laurie Gray made a presentation on Ethnography of Stockbrokers, to which Peter Merholz points here.
Impeccable methodology and judicious use of data, and a clear categorization of users according to patterns revealed during the study. Nothing a priory, but a contextualized set of questions with appropriate use of graphs and concepts, which points to the type of culture in which the different breeds of brokers live.
Interesting to note the emergence of the Fixed Income Professionals, though. With the emphasis on transparency and accountability for stockbrokers, as well as the need for documented transactions, are we going to be seeing more of those?
One other thing that I saw in this research was the incredible difference in cultures between these two subsets, the Brokers vs the Advisors. You can almost see the time constraints over which the former operate, and the careful weighed considerations of the latter.
And then an idea about having an appropriate monitoring / balancing tool that suggests investments based on this strategies and constraints.

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Coffee growers threatened by marketing and foreign capital!

A study on the changing market for coffee growers, published in the McKinsey Quarterly, and made for Technoserve, falls short in the considerations of the real reasons that coffee farmers are experiencing the worst social and economic crisis in the last 50 years.

The authors contend that the problem with coffee is a price-conscious consumer, and advanced technology that are driving prices down, while at the same time advocating diversification to other products such as fruits, lumber and flowers, or other sectors such as agrotourism and ecotourism.
This is not an answer.

The problems is not so much the lack of a market, since Starbucks has proved amply well that a chain, doing its own marketing, can actually prosper in the coffee business. In the same vein, the big corporations that enjoy the profits from the coffee trade are very happy with the benefits they reap from the extremely cheap coffee they buy.
And the OIC is just another club of buyers and sellers, dominated by the buyers which largely decide price, conditions and future demand.

Technology barely enters in this discussion – efforts, improvements, gains in productivity and extreme adaptations have been a hallmark of the coffee industry for ages, the biggest exporters always reinvesting a significant portion of their income into making the green coffee cheaper, more attractive, of much more quality to buyers. And still they were not satisfied, until basically the agreement on the OIC under which the prices were fixed broke some years back. From then on, it was a buyers market. And it still is.

The real reason for the coffee crisis, as reported by many of the non-profits (such as TransFair, Equal Exchange, Cafe Fair, Make trade Fair and Oxfam) that are working in countries where this has been felt, is the grower's lack of access to the final market and their extreme dependence on the conditions and price that a few international buyers set.
These large buyers have various advantages: consumer market domination, huge inventories with which to negotiate the price of the commodity, and enormous profits from the sale of roasted coffee in industrialized countries.
The growers, on the other hand, although numerous un numbers, are generally small farmers with little or no negotiating capability, besieged from years of continuous decline in real prices of green coffee, most of them in debt or with meager income, and suffering from the fallacies of the "free market".
The coffee growers suffer from all the continuous improvements pushed by countries, associations and generous studies such as the one by McKinsey, and now face extinction as the support from governments has vanished to give way to the absurd logic of "market economy", where a big corporation with millions of dollars in profits is supposed to be on equal footing as a farmer that has, in average, a few thousand coffee bushes and no money.

Coffee is no more a commodity than oil, yet as oil is capital intensive, it means that a few suppliers actually have control of the market. In the case of coffee, a multitude of growers are in need of cash to pay for their costs, making them vulnerable to the very limited offers that buyers place. Thus they find themselves in an oligopsony, where not even the governments of the producing countries seem to have any bargaining power.

Of the proposed solutions the authors of the study propose tourism, and other agricultural products, forgetting several basic factors about the foundations of coffee trade:

• it proceeds from small growers with very limited capital to modify their small ranches
• it has a strong cultural component, meaning that the coffee growers do not know how to do anything else
• the agricultural products mentioned must have a established market before even considering diversification
• another agricultural product would simply keep the growers in the primary sector of the economy, without access to the external and more profitable markets,
• and the tourism sector has a limited offer, benefiting at most 1% of the growers and requiring a huge investment in capital and know-how

The solutions has to be multi-tiered: first, a proper payment for the coffee production, allowing growers to recap costs and receive a benefit for their work, a free market without the excessive lobbying and coercion brought by the big coffee buyers. Second, growers becoming active partners in the commercialization and retail part of the coffee industry, thus redistributing the earnings and allowing reinvestment and technology while also increasing the quality of life of producers. Finally, identifying and implementing environmentally responsible practices that protect the lands and ecosystems that now depend on the presence of shade coffee, and encouraging those socially just practices both from producers and consumers, striving for sustainability and higher quality of life.

And yes, the consumers can pay 5 dollars for a cup of coffee. Now we have to see the producers getting more than 5 cents for that same cup.

via Small Businesses

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Perfect! I do not have to spend my hard-not earned-money on that fancy MBA from WFU! If you read blogue pointing to Mintzberg, and something tells me he is right, MBA courses are completely devoid of substance, and full of ambition:

Of course, my people skills are not that great either.

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This is piece of the report on my portfolio, which is doing OK, I may add.
Now, in what shall I spend my immense earnings, my incredible dividends?
A local Sunday newspaper.
or
A single cup of coffee - definitely not Starbucks.
What, I might even spend the whole dollar!

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A city can loose its big spenders, but not necessarily lose its appeal or cultural wealth: Consider, for example, San Francisco, a company that, according to Fortune, is host to only 7 of the bigger 500. On the other hand, New York, big hitter with 40 F500, is obviously a champion.

Now, boys and girls, descend from such rarefied heights and look at this your city, Winston-Salem: oops, no, no new knowledge industries. We only have tobacco, rapidly declining, and one bank. Sad, actually. Compare that to San Francisco, small, but with 7 F500, and what's more important, within California, a total of 106 F500 companies.

So I would postulate that there is much more of a connection between the number of big companies in the state and the ability of the cities on that state to attract further investment. Obviously, geographic location has always played an important part, as we see with Chicago, a city that has 23 F500 companies.

Diversity of enterprises seems to be very important as well. Arkansas, full of Walmart, ranks very low because it is its only major enterprise. California and New York kick ass, as the graph clearly shows.

So what is with all this?

Nothing. Just checking which would be the best city to go.

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David Weinberger points to Terra Nova, the place where the people interested in following, academically, the economics of MMOS such as Everquest may find a virtual forum.
This has been set up by Edward Castronova, the professor from Fullerton that published a paper on the economic interactions of this world.
What is more significative is that the virtual interactions from the fictitious country of Norrath have real value in this world. At which point, say, these services can be said to originate a new country – a new economy? What happens if these citizens decide to become independent, will Sony give them some kind of "bill of rights", or control over the servers that host the country?
Right now, as the blog points out, the economies of MMOs can be said to approach anything from $35 to $63 million. OK, that is a lot of money.
Currently, perhaps the model that most accurately approaches this system is a feudal one, where Sony et al. are the lords and the users are serfs, all working in borrowed land and generating income for the owners of the games and the servers.
Two scenarios / questions then:
a) What happens when an Open Source game makes it big in popularity?
b) What happens when the transactions are freed fro any constraints?

The tourism industry is one of the biggest in the world, and the only thing that they are selling is the experience, the life in another part of the world that is different from what you already have. Part of what makes it so big, though, is that it depends on myriads of independent providers that go all along the range of services and sizes. You have the multinational corporations essentially providing the same service as the local hostel owner in a small village in Ecuador.

Under this same model, what happens then when the MMO becomes widely dispersed, and trading of objects and spells becomes standard? Assume that somehow there is a de facto standard widely adopted, and that items from one game are useful in another one. Then, it is plausible that we may actually start to see serious professions based on services rendered in one or various games. And I am not referring to the extreme gamers that do have that now, but common people, small (or large) corporations that make their living out of those transactions.

And the owners of the game, extracting a small income per transaction, an aggregated value tax, just like any other government.

Oh, the perspectives!

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Dave exhorts us to buy local, urging everybody to take the Pledge to Buy Local:

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Globalization and the art of reducing costs, as seen from the NYT: U.S. Jobs That Went Overseas:

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Further to my post on how Mercurial: globalization is hurting the USA economy, this thing:

We have to distinguish between globalization, which is understood as the phenomenon by which we achieve scale economies by engaging in production regardless of geographical barriers, as opposed to the awareness of the different nations and cultures.

Currently, globalization is that force that pushes senseless consumerism; since only in huge quantities there are scale economies that justify production regardless of the place of origin, as long as the final product is cheap, we end up with companies producing millions of items to sell all over the world.

That has severe environmental and social implications: There is a push for consumption, and since these companies have a mandate from their shareholders to maintain low costs, we end up with less than optimal solutions, often a compromise between profit and health. Example: pesticides and hormones in your food.
These transnational companies lack any overseer over their activities in other countries, and as such become de facto promoters of social inequality and political unrest. Example: Shell in Nigeria, and Oxy in Colombia and Peru.
The tale that globalization tends to increase international trade is just sophistry: that trade is just companies recovering what they produced. There is no real trade from the countries involved in raw materials extraction, or exporting services (labor) at a very cheap rate. If anything, you can see that the terms of exchange become increasingly negative for the underdeveloped countries.

And finally, there is the social aspect of that in the destination country: Becoming exporters of currency, and desperately trying to consume even more as if it were the answer to the continuously diminishing quality of life.

Think local.

Posted by manino at 10:16 AM | Permalink | Comments (0) | TrackBacks (0)

And so have found programmers and developers that went to the latest PC EXPO/TECHXNY, where they were confronted by several international firms peddling their services at unbelievable low prices.
via eightlinks, who found it at wired.
Me? I am becoming a writer, an artist, a journalist, an ecoplanner.

Posted by manino at 12:02 PM | Permalink | Comments (4) | TrackBacks (0)

Unlike happier pundits speaking about WTO and its inevitability, I am relieved to read that the trade talks at Cancun were a success for poorer countries, and of course a failure for corporate-enabled goovernments.
Globalization as a mantra has cost already too much to the citizens of poorer countries, and right now those of industrialized ones are feeling it as well.
The irony here is that workers from Mexico and Brazil are, indeed, protecting the jobs of workers from North Carolina and Virginia.

Posted by manino at 11:51 AM | Permalink | Comments (0) | TrackBacks (0)

Checking on Ross Mayfield, he points to an article in Strategy in Business, where Richard Wilhelm mentions a study by the World Bank, where trust was defined as one of the most important elements in the economic growth of a country:

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It is clear why the soldiers would resort to using AK47s instead of the regulation-issued M16 or M4: A simple googlism would reveal that while the AK47 was designed to make paste out of the enemy, effectively going through whatever was in its path, while the M16 with its reduced bore simply created a horrible injury, allowing the injured person to live longer, and thus creating a strain in the medical facilities of the enemy. Clearly, a lot of reports started coming about the unreliability of M16 and such, and one soldier told me once that, although the AK47 was easier to operate, and thus preferred by the untrained soldier, the M16 had a much better technological base.
Other complain was that, while the AK47’s rounds would go through plants and foliage, the M16’s won’t, or would be severely deflected, taking away the effectiveness of the weapon.

The case here is not politics but economics and technology, however. The simpler technology has, in this case, overtaken the cumbersome and more expensive one, and for two simple reasons: a) Wider access to markets: the Kalashnikov is the most produced rifle in the world, from China to Russia, giving it tremendous economies of scale. The distribution of its spares and ammunition is therefore a simple problem. And b) Its simplicity of design means that it requires less time from the soldiers, while being a rude but effective tool.
I would also expect that quality problems arising in the construction would mean that the rifles would be useless after a relatively short while, but then again, we live in a consumer economy, where we replace a car every year just because of the smell. And then again, the abundance of spare parts and wide knowledge about the rifle means that there ought to exist local improvements and on-the-field repairs, a thing that somehow seems impossible with the M16 for a force fighting in a foreign country.

There. We need Jacob Nielsen concept on the usability of the AK47.

Posted by manino at 2:02 PM | Permalink | Comments (0) | TrackBacks (0)

ON accounting the effects of both strong and weak ties, Joi Ito and Ross Mayfield deal with variables such as trust, self-esteem and social cost.
Of course, being the economist, I am partial to measure the social cost of establishing a network, and then developing it from there.
In the particular case of a job hunt, I theorize that the strong ties, the easiest and closest resources, have all been used or tapped, whereas the weak ties, although placing a burden on those receiving the favor, actually allow for the extension of said network.
There is the issue of weak ties, which I understand like so: the possibility of a job offering through the immediate network, that is to say, through channels that are close and therefore have a similar "energy" level, depends on the available energy of said network, with respect to your particular field. If your father was a President of the USA, it is easy for you top land a job doing so through the use of those immediate channels, regardless of adequacy. However, for lower energy levels, weak ties allow to explore other levels in which information and resources may be much more abundant. However, since these ties are, by definition, weak, you need to work them much more intensively than the close ones, meaning to pump much more information through those than you would do with close channels.
As for Shannon, I absolutely agree with her: temp agencies are the spawn of the devil.

Posted by manino at 3:29 PM | Permalink | Comments (1) | TrackBacks (0)

Peter Merholz makes an interesting exposition on decision making, via his thoughtwander post. When dealing with economic reasoning, and taking into account that practically all our models are based on the subjective value assigned to C or S, we often make assumptions regarding the strength of the market, or the wisdom of economic agents.
Obviously, we need to take into account the wildly wandering economic agent, the one that buys on impulse or that chooses non-optimally, just because that is what we are.
Now, do I need a digital camera?

Posted by manino at 11:13 PM | Permalink | Comments (0) | TrackBacks (0)

Warren Buffet's comentary on Bush's proposed tax cut, as reported by the WaPo:

Posted by manino at 6:44 PM | Permalink | Comments (0) | TrackBacks (0)

Few realize soon that the free market utopia is way different from what it really is, a system by which entrenched market dominants get more power, often at the expense of less powerful countries, wrecking havoc with their social structure and perpetuating a center-periphery structure. Stephen Byers realizes his mistake, and explains why:

Posted by manino at 7:23 PM | Permalink | Comments (0) | TrackBacks (0)

Brad DeLong starts with an accurate description of Bush's economic policy, or lack thereof, and then proceeds to make a scathing simile with a failing Ottoman empire, one in which power is held by those that have access to power through internal machinations and devious practices.
Much more important than just the anecdotical quality of the description of the Topkapi Palace at 1600 Pennsylvannia, is the situation by which Brad identifies the riff between the economicst camp championed by Greenspan, and those that oppose esoteric ideas such as fiscal policy and sensible taxes.
Further on, there is the issue of the invented economic report, as Brad reports here, as reported by Newsday and Salon.
Point: What are we going to do? Impeachement, anyone?
Not so much the fact that he was blatantly lying and citing inexistent figures to support a highly unpopular proposal, but that so far nobody has taken the president to task, asking about his methods and responsibilities. It seems that once president, there is no more accountability for actions and omissions.
Obviously, Bush still believes in Enron as its spiritual guide, Congress in his pocket and the Dems a vote of silence.

Posted by manino at 11:55 PM | Permalink | Comments (0) | TrackBacks (0)

Jay Cross interviews Verna Allee, author of The Future of Knowledge, in which she melds, from what I get, management, systems theory and complexity, yet she accomplishes this with remarkable success. Jay says:

Verna’s methodology involves mapping value exchanges among nodes in a networked system. She looks for patterns, helps constituents negotiate the amount of value going in and coming out of each node, and models the entire system. This is not something for the feint of heart; she described mapping the service function of a very large telecom outfit in a couple of hours.

Posted by manino at 9:05 PM | Permalink | Comments (0) | TrackBacks (0)

Are high paying jobs going overseas? This article on the new Global Job Shift, is simply showing that, despite the relative advantage of the USA and Europe in the past years, all knowledge is simply a commodity that ends up being traded at the best price:

The truth is, the rise of the global knowledge industry is so recent that most economists haven't begun to fathom the implications. For developing nations, the big beneficiaries will be those offering the speediest and cheapest telecom links, investor-friendly policies, and ample college grads. In the West, it's far less clear who will be the big winners and losers. But we'll soon find out.

Posted by manino at 2:55 AM | Permalink | Comments (1) | TrackBacks (0)

The New Yorker extols the achievements of Starbucks, which I can't deny, and their progress and ability in creating the new necessity for the 2000's.
However true that is, I have to take issue: Every cup of coffee sold here at 5 bucks each reminds me of the farmer that receives all of 20 cents for a pound of their coffee. Every expansion of a new store reminds me of how the farmer may not have access to medical care.
And then we talk about inequalities.

Posted by manino at 4:25 PM | Permalink | Comments (0) | TrackBacks (0)

There has always been a heated debate on whether our little rational consumers are rational at all, and with the latest Nobel prizes there has been some light shed on that very contentious piece of theory.

However, to anybody that has ever made a bid on ebay, like MightyGirl, it becomes quite obvious that it is not the amount or even the perceived value of said good or service. As she clearly states it,

If I'm the first bidder on an eBay item, I get inexplicably territorial. It's the electronic version of peeing on a tree. When someone else bids, my competitive spirit kicks in.

making it clear that it is something very primal and basic getting into play anytime we, as consumers, are confronted with the options to buy or participate in the market.
I will tell you about it later.

Posted by manino at 12:15 PM | Permalink | Comments (0)