6 ms·

Subway history: Don't be early

42 points by clarkm 12y ago

ggchappell 12y ago
Interesting article. The first comment (by "dg") is interesting, too: > Yup. American visitors to Europe + UK often marvel at the efficient passenger railway system and wonder why the US can’t build something similar, without understanding the history of how they were built. In the 1800s early investors/inventors went through a railway mania, grossly overbuilt, and went bankrupt. The good lines were later scooped up for a fraction of their original cost by a 2nd round of investors, and morphed into today’s system. It was never economically feasible to build a passenger railway system without first wiping out the “too early” investors. So while being too early pretty much guarantees failure, it seems we might need those early people. Perhaps the recipe for an truly innovative society necessarily includes over-encouragement of bleeding-edge innovator types. These will almost certainly fail; however, in failing, they allow later businesses to succeed. Readers are invited to consider what role Y Combinator might play in this process. :-)
- bcohen5055 12y ago
  This kinda sounds like dark fiber laid out during the first internet bubble. Maybe Google fiber is like that 2nd round of railway investors.
  - raverbashing 12y ago
    And the first social networks (Friendster/MySpace) with Facebook
    - jimmaswell 12y ago
      It's a shame, since MySpace was so much better in a lot of ways I care about, majorly the HTML customization.
      - raverbashing 12y ago
        I don't recommend <blink> tags though.
    - nostrademons 12y ago
      And Altair, Commodore, Tandy, Atari, Osbourne, etc. for PCs. And Altavista, Lycos, Infoseek, Excite, etc. for Google. And YouSendIt & clones for DropBox. And Hotmail, Outlook Web Access, Y!Mail, etc. for GMail. As an entrepreneur, it's generally much more lucrative to take other ideas that people have been playing around with and getting some modest success and then perfect them, rather than to have your own ideas.
  - soperj 12y ago
    This is exactly what came to mind for me.
- gizmo686 12y ago
  There is another option: subsidize bleeding-edge innovators.
- x1798DE 12y ago
  I'm not sure it follows that because currently successful enterprises utilize the bargain-basement prices of over-enthusiastic early ventures that we're better off (as a whole) if there are a lot of over-enthusiastic early ventures. In fact, it's very likely that this is a second-best solution. For example, imagine there's an early frenzy in solar panels, companies way, way over-manufacture them. As they go out of business and are liquidated, the sell-off of the massive panel surplus below-cost causes significant adoption of this early solar panel technology. A huge fraction of people now have solar panels on their roof, but now there's no longer a business incentive for sustainable production of solar panels (i.e. advancements in some technology that would make them cost-effective), because the market is now saturated. Additionally, these solar panels may well be displacing other next-generation energy technologies because of the artificially low price, even if there is no advancement that would make solar power cost-effective on a reasonable time scale. On net, humanity had to pay the full price for all those solar panels, and once they exist we're better off using them than not, but it's not necessarily true that because we have them and they are in use, we're better off than we would be if they had never been created in the first place. EDIT: I should clarify that I'm not sure that under investment is any better - the right amount of investment is a knowledge problem that we generally solve iteratively with feedback from the profit-loss system. It's just that just because you can reduce the total deadweight loss from over-investment doesn't mean that over-investment is somehow a good thing.
  - S4M 12y ago
    Your example of solar energy is true if solar energy is kept only to houses, but maybe in the process of massive production of solar panels, those panels will have been made more efficient, making it possible to use solar energy to (partially) power different things - for example trains, planes or cars (I have no clue if that would be possible) - creating a continuous demand for solar panels.
    - x1798DE 12y ago
      Well the point is that it's a knowledge problem of how to best allocate resources. It's certainly possible that it wasn't an over-investment writ large just because a given company went out of business, but the point I was trying to make was that, because post facto you ignore sunk costs, from the perspective of someone coming around after a bust, there's all of a sudden a whole bunch of "free" infrastructure that they can build from, but this can lead you to the incorrect conclusion that it was a good idea to build all this infrastructure in the first place (and thus something you'd want to happen again). What you're actually doing is reducing the dead-weight loss from over-investment by utilizing the leftover assets, chances are it won't be a net positive, overall.
joshu 12y ago
HN really, really needs to stop showing just the domain and show the full hostname (perhaps minus ^www\d*.) instead.
- mtmail 12y ago
  The bugs and feature request queue got much better recently. In the past it was just a long and disorganized comment thread. https://github.com/HackerNews/HN/issues https://github.com/HackerNews/HN/issues
akgerber 12y ago
"But before long more than a hundred decorated omnibuses were crowding the streets of the city, with names painted on the sides, from George Washington to Lady Washington to Benjamin Franklin. They were popular. And they caused complete chaos. For the individual owners of the omnibuses, nothing mattered more than the paying passenger. Drivers whipped their horses repeatedly to speed them past a competitor to the next potential fare, even if it meant a harrowing few seconds for those already on board. Grazing a lamppost to cut a corner or to cut in front of a rival was fair game, and pedestrians not paying attention could get maimed by a cornering horse or the trailing carriage." This sounds exactly like the present situation with dollar vans on Flatbush Avenue in Brooklyn.

42 points by clarkm 12y ago

Interesting article. The first comment (by "dg") is interesting, too: > Yup. American visitors to Europe + UK often marvel at the efficient passenger railway system and wonder why the US can’t build something similar, without understanding the history of how they were built. In the 1800s early investors/inventors went through a railway mania, grossly overbuilt, and went bankrupt. The good lines were later scooped up for a fraction of their original cost by a 2nd round of investors, and morphed into today’s system. It was never economically feasible to build a passenger railway system without first wiping out the “too early” investors. So while being too early pretty much guarantees failure, it seems we might need those early people. Perhaps the recipe for an truly innovative society necessarily includes over-encouragement of bleeding-edge innovator types. These will almost certainly fail; however, in failing, they allow later businesses to succeed. Readers are invited to consider what role Y Combinator might play in this process. :-)

bcohen5055 12y ago
This kinda sounds like dark fiber laid out during the first internet bubble. Maybe Google fiber is like that 2nd round of railway investors.
- raverbashing 12y ago
  And the first social networks (Friendster/MySpace) with Facebook
  - jimmaswell 12y ago
    It's a shame, since MySpace was so much better in a lot of ways I care about, majorly the HTML customization.
    - raverbashing 12y ago
      I don't recommend <blink> tags though.
  - nostrademons 12y ago
    And Altair, Commodore, Tandy, Atari, Osbourne, etc. for PCs. And Altavista, Lycos, Infoseek, Excite, etc. for Google. And YouSendIt & clones for DropBox. And Hotmail, Outlook Web Access, Y!Mail, etc. for GMail. As an entrepreneur, it's generally much more lucrative to take other ideas that people have been playing around with and getting some modest success and then perfect them, rather than to have your own ideas.
- soperj 12y ago
  This is exactly what came to mind for me.
gizmo686 12y ago
There is another option: subsidize bleeding-edge innovators.
x1798DE 12y ago
I'm not sure it follows that because currently successful enterprises utilize the bargain-basement prices of over-enthusiastic early ventures that we're better off (as a whole) if there are a lot of over-enthusiastic early ventures. In fact, it's very likely that this is a second-best solution. For example, imagine there's an early frenzy in solar panels, companies way, way over-manufacture them. As they go out of business and are liquidated, the sell-off of the massive panel surplus below-cost causes significant adoption of this early solar panel technology. A huge fraction of people now have solar panels on their roof, but now there's no longer a business incentive for sustainable production of solar panels (i.e. advancements in some technology that would make them cost-effective), because the market is now saturated. Additionally, these solar panels may well be displacing other next-generation energy technologies because of the artificially low price, even if there is no advancement that would make solar power cost-effective on a reasonable time scale. On net, humanity had to pay the full price for all those solar panels, and once they exist we're better off using them than not, but it's not necessarily true that because we have them and they are in use, we're better off than we would be if they had never been created in the first place. EDIT: I should clarify that I'm not sure that under investment is any better - the right amount of investment is a knowledge problem that we generally solve iteratively with feedback from the profit-loss system. It's just that just because you can reduce the total deadweight loss from over-investment doesn't mean that over-investment is somehow a good thing.
- S4M 12y ago
  Your example of solar energy is true if solar energy is kept only to houses, but maybe in the process of massive production of solar panels, those panels will have been made more efficient, making it possible to use solar energy to (partially) power different things - for example trains, planes or cars (I have no clue if that would be possible) - creating a continuous demand for solar panels.
  - x1798DE 12y ago
    Well the point is that it's a knowledge problem of how to best allocate resources. It's certainly possible that it wasn't an over-investment writ large just because a given company went out of business, but the point I was trying to make was that, because post facto you ignore sunk costs, from the perspective of someone coming around after a bust, there's all of a sudden a whole bunch of "free" infrastructure that they can build from, but this can lead you to the incorrect conclusion that it was a good idea to build all this infrastructure in the first place (and thus something you'd want to happen again). What you're actually doing is reducing the dead-weight loss from over-investment by utilizing the leftover assets, chances are it won't be a net positive, overall.

joshu 12y ago

HN really, really needs to stop showing just the domain and show the full hostname (perhaps minus ^www\d*.) instead.

mtmail 12y ago
The bugs and feature request queue got much better recently. In the past it was just a long and disorganized comment thread. https://github.com/HackerNews/HN/issues https://github.com/HackerNews/HN/issues

akgerber 12y ago

"But before long more than a hundred decorated omnibuses were crowding the streets of the city, with names painted on the sides, from George Washington to Lady Washington to Benjamin Franklin. They were popular. And they caused complete chaos. For the individual owners of the omnibuses, nothing mattered more than the paying passenger. Drivers whipped their horses repeatedly to speed them past a competitor to the next potential fare, even if it meant a harrowing few seconds for those already on board. Grazing a lamppost to cut a corner or to cut in front of a rival was fair game, and pedestrians not paying attention could get maimed by a cornering horse or the trailing carriage." This sounds exactly like the present situation with dollar vans on Flatbush Avenue in Brooklyn.