4 ms·
I'll expand that it's a double relativity. It is my opportunity cost among options, relative to my counterparty's opportunuty cost among options. It's not enou
by greggyb 7y ago
I'll expand that it's a double relativity. It is my opportunity cost among options, relative to my counterparty's opportunuty cost among options.
It's not enough that the CEO is better at both strategy AND typing than his secretary. We must know the CEO's ratio of productivity between typing:strategy AND the secretary's ratio of productivity for the same.
Say the CEO can produce 5 strategies in an hour, or could spend the hour to produce 3 typings. And the secretary, in an hour can produce 1 strategy or 2 typings.
The CEO could give up 5/3 of a strategy to produce a typing. Her secretary, on the other hand, must only give up 1/2 a strategy to produce a typing. Thus it makes sense for the CEO to exchange her strategies for the typings produced by the secretary.
If the ratios were instead CEO 5/3 and secretary 3/1, then it would make sense for the secretary to produce strategies and trade them to the CEO for the CEO's typings.