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> This is a puzzle! Why would the market fail to reward innovative firms, or, conversely, why does it continue rewarding less innovative firms? Unfortunately, h

> This is a puzzle! Why would the market fail to reward innovative firms, or, conversely, why does it continue rewarding less innovative firms? Unfortunately, here we don’t have clear answers. Puzzle no more, the answers are obvious! There are two interlinked mechanisms leading to this phenomenon. The rise of inequality (centralisation of power and wealth) and the rise in private debt. Both require coordinated governmental intervention to address, which won’t happen until the next economic crisis and dramatic drop in standards of living. Wish it was different, but economic theory (mainstream anyway) doesn’t account for our present situation and the control system is cycling into instability. The upside is that we might learn the lessons this time around.

cryptonector 10mo ago
You don't explain the connection at all. You're just injecting your political world-view into the cause so you can hawk your preferred political solution.
- lll-o-lll 10mo ago
  It’s nothing to do with politics, it’s just maths. And if you think I’m a leftist, you would also be wrong! Unfortunately, educating yourself on this topic is not easy and involves differential equations. The economic models that fail to predict our current situation are simplifications. I’d link you, but I don’t think I’ll be getting a very receptive audience!
  - cryptonector 10mo ago
    Earlier you wrote: > Puzzle no more, the answers are obvious! and now you write: > Unfortunately, educating yourself on this topic is not easy and involves differential equations. Which is it? Obvious but... only if you're "educated"? > The economic models that fail to predict our current situation are simplifications. Are there economic models that are not simplifications? If being simplifications makes the models trivial to dismiss, but also all models are simplifications, then how do you successfully "predict our current situation"? I guess not with models. Just from first principles or something, but like, which? And then you need to provide the full chain of reasoning, and don't let that become a model. Or maybe it's simulations, but those are also invariably simplifications. It's hard to take this seriously. Some links would be appreciated. > And if you think I’m a leftist, you would also be wrong! I didn't refer to specific politics, just your politics whatever they happen to be. Now you tell me I'm an ignoramus while you're educated and that's why this stuff is obvious to you but not to me -- and also not to [some? many? most??] economists. Plus: > I’d link you, but I don’t think I’ll be getting a very receptive audience! Certainly no link -> non-receptive audience. Links might or might not improve the situation, but we can't tell till you furnish some.
DoctorOetker 10mo ago
> The rise of inequality (centralisation of power and wealth) and the rise in private debt. [...] present situation and the control system is cycling into instability. [...] this time around. Your explanation assumes the article is trying to explain a recent phenomenon. The article actually discusses a puzzling pattern spanning a huge time interval. You probably point at the right problem (inequality, centralisation of power and wealth), but this article actually indicates this problem has been going since before any of us were even born.
- lll-o-lll 10mo ago
  The puzzle referenced is why more innovation is no longer rewarded by the market. That’s relatively recent.
  - DoctorOetker 10mo ago
    You still misread the article: they observe the nearly constant 2% growth across the long timespan, regardless of the relative increases in researchers, regardless of all the policy changes, regardless of ... The article is NOT about some recent change. Please cite the article if you believe it is trying to solve a puzzle concerning a recent change. The whole point is that this 2% seems to be robust, regardless of investing or getting more ideas, invalidating the idea that the growth is a simple result of the production of ideas (say making blueprints for a new kind of factory, which can then be copied without having to make more blueprints).
    - lll-o-lll 10mo ago
      I did cite the article! My response is to that specific section quoted. Did you even read it?
      - DoctorOetker 10mo ago
        I am not asking you for a random citation of the article, but one that demonstrates the article discusses a puzzle concerning a recent trend, as opposed to a longtime ongoing one. Your citation of the article: > This is a puzzle! Why would the market fail to reward innovative firms, or, conversely, why does it continue rewarding less innovative firms? Unfortunately, here we don’t have clear answers. does not refer to any recent change, indeed, it uses the word "continue" invalidating your claim that the puzzle is about some recent change.

cryptonector 10mo ago

You don't explain the connection at all. You're just injecting your political world-view into the cause so you can hawk your preferred political solution.

lll-o-lll 10mo ago
It’s nothing to do with politics, it’s just maths. And if you think I’m a leftist, you would also be wrong! Unfortunately, educating yourself on this topic is not easy and involves differential equations. The economic models that fail to predict our current situation are simplifications. I’d link you, but I don’t think I’ll be getting a very receptive audience!
- cryptonector 10mo ago
  Earlier you wrote: > Puzzle no more, the answers are obvious! and now you write: > Unfortunately, educating yourself on this topic is not easy and involves differential equations. Which is it? Obvious but... only if you're "educated"? > The economic models that fail to predict our current situation are simplifications. Are there economic models that are not simplifications? If being simplifications makes the models trivial to dismiss, but also all models are simplifications, then how do you successfully "predict our current situation"? I guess not with models. Just from first principles or something, but like, which? And then you need to provide the full chain of reasoning, and don't let that become a model. Or maybe it's simulations, but those are also invariably simplifications. It's hard to take this seriously. Some links would be appreciated. > And if you think I’m a leftist, you would also be wrong! I didn't refer to specific politics, just your politics whatever they happen to be. Now you tell me I'm an ignoramus while you're educated and that's why this stuff is obvious to you but not to me -- and also not to [some? many? most??] economists. Plus: > I’d link you, but I don’t think I’ll be getting a very receptive audience! Certainly no link -> non-receptive audience. Links might or might not improve the situation, but we can't tell till you furnish some.

DoctorOetker 10mo ago

> The rise of inequality (centralisation of power and wealth) and the rise in private debt. [...] present situation and the control system is cycling into instability. [...] this time around. Your explanation assumes the article is trying to explain a recent phenomenon. The article actually discusses a puzzling pattern spanning a huge time interval. You probably point at the right problem (inequality, centralisation of power and wealth), but this article actually indicates this problem has been going since before any of us were even born.

lll-o-lll 10mo ago
The puzzle referenced is why more innovation is no longer rewarded by the market. That’s relatively recent.
- DoctorOetker 10mo ago
  You still misread the article: they observe the nearly constant 2% growth across the long timespan, regardless of the relative increases in researchers, regardless of all the policy changes, regardless of ... The article is NOT about some recent change. Please cite the article if you believe it is trying to solve a puzzle concerning a recent change. The whole point is that this 2% seems to be robust, regardless of investing or getting more ideas, invalidating the idea that the growth is a simple result of the production of ideas (say making blueprints for a new kind of factory, which can then be copied without having to make more blueprints).
  - lll-o-lll 10mo ago
    I did cite the article! My response is to that specific section quoted. Did you even read it?
    - DoctorOetker 10mo ago
      I am not asking you for a random citation of the article, but one that demonstrates the article discusses a puzzle concerning a recent trend, as opposed to a longtime ongoing one. Your citation of the article: > This is a puzzle! Why would the market fail to reward innovative firms, or, conversely, why does it continue rewarding less innovative firms? Unfortunately, here we don’t have clear answers. does not refer to any recent change, indeed, it uses the word "continue" invalidating your claim that the puzzle is about some recent change.