Science: "Complaining Is Terrible for You"

It turns out having a negative outlook on life tends to have a negative impact on your physical and mental health (Inc). I'd say this was related to the last post.

How cronyism hurts entrepreneurship

It might be shocking to some people, but entrepreneurs don't just do it for the money (USNews)

Psychologists have found the intrinsic desire to master challenges, known as "mastery," to be an important human drive. Economics has emphasized the external or monetary rewards for business, typically to the exclusion of mastery.

The words of entrepreneurs provide evidence for mastery as a business motive. Tom Monaghan, founder of Domino's Pizza, has remarked, "To me, the real substance of life and work is the constant battle to excel." Cable television pioneer Ted Turner observed, "America is about competition and rising above that competition." Michael Bloomberg has said that, "Even today, after toiling for 30 years, I wake up looking forward to practicing my profession, creating something, competing against the best … receiving psychic compensation money can't buy."

And actions speak louder than words. Many members of the Forbes Richest Americans list work long hours, even though they already have more money than one could spend in several lifetimes. A 2013 profile noted that Bill Gates was looking forward to working more with product managers in the upcoming year. Serial entrepreneur Richard Branson has started over 200 businesses and never tires of the challenge of making a new venture succeed.

[...] Cronyism can reward favored entrepreneurs with profits, but not necessarily mastery. Many top athletes would not care to compete in a contest rigged in their own favor. Similarly, some entrepreneurs or businesses, who may be well-positioned to take on a new challenge, do not seek government favoritism. And others may choose not to compete when it's clear that their performance doesn't necessarily equal results in a rigged marketplace.

The extension of cronyism in an economy over time can affect the types of individuals who choose business as a career. Profits for entrepreneurs who successfully court favor with politicians may not satisfy those with a true competitive streak. Imagine a track meet where the organizers rig the races so that their favorites, and not the best runners, win. Such a meet will likely fail to attract the world's best competitors.

The effects on the quality of entrepreneurship could be devastating in the long-term. After mastery-seekers choose other pursuits, the remaining profit-seekers will likely have no qualms about seeking or benefitting from government favors. A vicious cycle of cronyism could ensue, as more favoritism results in a group of business leaders more willing to lobby, leading in turn to more favors.

Ranking the fiscal solvency of American states (and territory)

Not surprisingly, Puerto Rico is dead last. Runners up are Illinois, New Jersey and Massachusetts (Mercatus).

The Bruce Lee technique to learning

Focus on one thing, repeat, repeat, repeat (Quartz):

Bruce Lee said, "I don’t fear the man who has practiced 10,000 kicks. I fear the man who practiced one kick 10,000 times."

Sleep more, earn more

According to Freakonomics, The Economics of Sleep:

And we find that permanently increasing sleep by an hour per week for everybody in a city, increases the wages in that location by about 4.5%.

But, as they also point out, there are limits.

Are wage increases a lagging indicator?

There's been a lot of handwringing over stagnant wages, but economist James Bessen tries to put it in historical context and makes the argument that the cause isn't technology (Vox):

There's been a lot of worry that increasingly sophisticated computers would replace more and more jobs, which could lead to a future where many low-skilled workers are unable to find a job at all.

But Bessen argues that this is a misunderstanding of recent economic trends. "I just don't see evidence of it," he says. "There are very few occupations where everything has been automated."

Bessen points to bank tellers as an example. During the 1990s and 2000s, banks installed thousands of automated teller machines. Yet surprisingly, the number of human tellers actually grew slightly during the same period

A similar interpretation from Ray Dalio at Bridgewater.

Multitasking makes your brain smaller apparently

There's a mental note that I should be making on this (Inc.com) as I post this while I play Clash of Clans on the side...

Using a 'surprise journal' to make better decisions?

It's an interesting idea - and not sure if the act of recording cognitive dissonance and other surprises will necessarily help in making better decisions but it makes sense (FastCompany):

Galef set out on a personal quest to identify her wrong assumptions. The outcome: the Surprise Journal. She keeps this journal with her at all times, writing down when something surprises her and why. For example, she noticed she was surprised that both older and younger people were attending her workshops, because she assumed people would self-segregate by age. She was surprised that her students would mention a concept from one of her colleague’s classes, because she didn’t expect that idea to be very memorable. “I started thinking about surprise as a cue that my expectations were wrong,” she says.

Many behavioral psychology and cognitive science studies demonstrate that humans find it difficult to change their opinions. In what is known as the “bias blind spot,” it is much easier for us to see other people’s biases than our own. The “confirmation bias” reveals that we seek out feedback from people who are likely to agree with us: We read newspapers and watch TV talk shows that are probably going to tells us things we already agree with. Galef says that there is much more research about how biased humans are than how to change these biases. “I really wanted to get better at changing my mind,” she tells me. “This is not a perfect solution, but it has gone a long way to making me more open and less defensive about when I’m wrong.”

Sometimes the surprises she stumbles upon are major shockers--a friend she thought was loyal betrays her, or a scientific belief is disproven. But the everyday moments of surprise are actually more exciting to Galef. It surprised her, for instance, that her teaching ratings were sometimes lower than the ratings of colleagues. This signaled to her that she had been over-confident about her teaching abilities and had perhaps not been open to feedback that could have improved her skills. Sometimes, it surprises her when audience members seem enthusiastic about one of her talks. Rather than just being flattered by the positive feedback, Galef takes this as an opportunity to assess her own understanding of what makes a topic useful or exciting: Perhaps her pre-suppositions about what other people find interesting is due for a change?

Not sure what your purpose is in life? Pivot

It's not just for startups. Useful advice from Barking Up the Wrong Tree.

Bridgewater Associates and the "soul of a hedgefund 'machine'"

An interesting look inside Bridgewater and its founder Ray Dalio - particularly as I've been doing a lot of research lately about systematization and processes (WSJ):

How do you build the world's largest hedge fund? Bridgewater Associates founder Ray Dalio says he did it by creating a culture of "radical truth and radical transparency." Mr. Dalio's perhaps radical belief is that "everything is a machine"—including organizations and even the individual people within them. At his firm's Westport, Conn., headquarters, we are discussing the human machines at Bridgewater and the equally fascinating machine known as the U.S. economy.

As for the people at his firm, the idea is to encourage everyone to accept unvarnished criticism as a treasured opportunity to learn and to solve problems. This is intended to allow constant refinement of business processes—also known as machines within the firm—from how Bridgewater buys office furniture to how it evaluates the world oil market.

But human machines don't always welcome complete candor. And at Bridgewater they have to get used to internal software that conducts a non-stop evaluation of their performance based on daily entries from colleagues and even rates their credibility on particular issues. This doesn't mean the software makes all decisions. When the system recently reported that the company's head receptionist was underperforming, executives decided that it was a case of the software not being calibrated to effectively measure her work.

Conquering chronic procrastination

Yeah I'll admit it... this is could be quite useful: "5 weird (but effective) ways you can conquer chronic procrastination" (Time).

Using the word "so" undermines your credibility

According to Hunter Thurman (FastCompany):

Beginning your sentence with “so” orients your message and subconsciously alerts your audience that what you’re about to say is different than what you’ve been talking about up until this point.

Winner takes all: how technology is driving returns to talent

An article that could provide some of the clues of why inequality is growing as it "enable[s] the best producers to extend their reach" (NYT via GregMankiw):

Analogous forces help explain the surge in income inequality that began in the late 1960s. In domain after domain, we reasoned, technology has enabled innovative business models to serve broader markets. Local accountants have been displaced by tax software, brick-and-mortar shops by Amazon.com and other online retailers. And now, there is even worry that live, in-theater HD broadcasts of Metropolitan Opera performances could displace local opera companies across the land.

But similar advances in production and distribution methods also exert countervailing effects. As the former Wired magazine editor Chris Anderson explained in his 2006 book, “The Long Tail” (the title refers to a property of statistical distributions), digital technology has made music, books, movies and many other goods economically viable on a much smaller scale than before.

For example, films once generated revenue only by mustering large-enough audiences to justify screenings in theaters. Many niche offerings, like Hindi-language movies in medium-size American cities, were simply not viable. Services like Netflix, however, changed all that. Because digital movies cost next to nothing to ship, people can now watch them without having to assemble a posse of ticket buyers.

"The automation doesn’t replace us. It makes us better."

From Wired: What UPS Drivers Can Tell Us About the Automated Future of Work:

Many of us are a lot like UPS drivers in our daily lives: The only difference is we spend our days shepherding virtual bits between destinations rather than driving physical boxes around. But we still face many of the same prioritization and optimization challenges.

Yet one of the biggest misconceptions about software-enabled decision making is the idea that it’s far removed from us. Many people think of data as something technical that only accountants, warehouses, data scientists, or the latest slew of tech technology-as-a-coach startups need to worry about. We don’t recognize the strategic connection between information collection and decision making, or see how data can help increase our own performance.

This skepticism was in evidence during UPS’s first roll out of ORION. In hindsight, Levis admits that he bears some of the blame for that. “We’d go in the morning and say, here’s your planned number of miles,” he recalled. Telling a driver with years of experience that an algorithm knew how to plan a route better than he did struck them as more than a little dismissive.

Levis’s team decided to change approaches and tackle the drivers’ resistance head-on by issuing a challenge: “beat the computer” by combining ORION’s suggestions with their own. One driver who used ORION’s suggestions ended up subtracting 30 miles from his daily route.

Does "doing what you love" devalue work and hurt workers?

Apparently... though I'm not sure I agree with the definitions here. The basic argument is that the value in work is reflected not in self actualization but how well it serves others. But why can't you love solving the problems others have? And wouldn't it be far more efficient and sustainable to love doing so? (Slate via Instapundit)

There’s little doubt that “do what you love” (DWYL) is now the unofficial work mantra for our time. The problem with DWYL, however, is that it leads not to salvation but to the devaluation of actual work—and more importantly, the dehumanization of the vast majority of laborers.

Superficially, DWYL is an uplifting piece of advice, urging us to ponder what it is we most enjoy doing and then turn that activity into a wage-generating enterprise. But why should our pleasure be for profit? And who is the audience for this dictum?

DWYL is a secret handshake of the privileged and a worldview that disguises its elitism as noble self-betterment. According to this way of thinking, labor is not something one does for compensation but is an act of love. If profit doesn’t happen to follow, presumably it is because the worker’s passion and determination were insufficient. Its real achievement is making workers believe their labor serves the self and not the marketplace. . . . If we believe that working as a Silicon Valley entrepreneur or a museum publicist or a think-tank acolyte is essential to being true to ourselves, what do we believe about the inner lives and hopes of those who clean hotel rooms and stock shelves at big-box stores? The answer is: nothing.

But as Glenn Reynolds points out - "Well, there’s work, and then there’s work. Work need not be self-actualizing to be valuable, to the worker and to others. But even when you love your work as much as I love mine, there are days when you’d really rather just stay in bed."

Burning out

Nope, it's not about me. I think there are a few solutions to this - a deep and strong sense of purpose, someone to balance you off, and other activities like CrossFit for release... but this is a "cautionary tale" (FourHourWorkWeek):

It’d be very easy for me to manufacture a villain in this story. I could tell you that I was pushed too hard, or that no one cared about how I felt. But that’s not the truth. I was the one who chose to stay up until 4:00AM. I was the one pouring caffeine down my throat four times a day. I was the one who secretly ordered brain pills. I was the one who isolated myself from friends and kept my feelings hidden. Everything I did that fueled my anxiety was my choice.

The truth is that all of my emotional issues would have unfolded for me at some point in my life, regardless of whom I was working with. I was the creator of my own anxiety, and I was the one who broke myself with my workaholic habits. I just didn’t recognize how destructive my behavior was because I thought it was normal.

Update - more on dealing with overwhelming amounts of work (FourHourWorkWeek).

The 1,000 hour rule for would be entrepreneurs

Pretty good advice... being an entrepreneur is a marathon, not a sprint (Lifehacker):

I was chatting with my friend David from Greenback Tax Services the other day about these misconceptions. I said: "people don't understand they need to be poor for 1000 days." Our basic hypothesis: you'll be doing worse than you were at your job for 1000 days after you start your muse business.

I've seen it happen a bunch of times. For many of us it's been almost exactly those 1000 days it took for us to get back to the level of income we enjoyed in our corporate days.

Overwork and productivity

I've been realizing that I have to do better at defining boundaries between work and play - or at least different levels of work/play to avoid burnout (New Yorker via GTD):

The perplexing thing about the cult of overwork is that, as we’ve known for a while, long hours diminish both productivity and quality. Among industrial workers, overtime raises the rate of mistakes and safety mishaps; likewise, for knowledge workers fatigue and sleep-deprivation make it hard to perform at a high cognitive level. As Solomon put it, past a certain point overworked people become “less efficient and less effective.” And the effects are cumulative. The bankers Michel studied started to break down in their fourth year on the job. They suffered from depression, anxiety, and immune-system problems, and performance reviews showed that their creativity and judgment declined.

The benefits of copycatting

A blueprint for innovating (Techcrunch)?

Unexpectedly, the researchers found that imitation was beneficial. Or, in academic speak, “the substantial proportion of imitation present in improvements shows that imitated guesses were often the basis for further productive exploration.” In other words, imitation is never identical and the micro-experiments help increase the possibilities explored, ultimately leading to better performance.

Notably, if performance scores were hidden, “participants searched more broadly and randomly, and both quality and equity of exploration suffered.” That is, when we hide our successes, imitators have to experiment blindly.

As ScienceDaily explained, “the longer people played the game, the less they imitated others. The more players there were in a game, the higher the scores. The diversity of solutions decreased over the rounds, and scores increased.” Networks of innovation do learn, and unsuccessful strategies fall off like a vestigial limb.

I think the author overreaches when it comes prescriptive policies - but it's an interesting study nonetheless.

The upside to robots

ASI criticizes the Economist for its "breathless" fears of job losses from automation (ASI):

The Economist has another of those breathless pieces worrying about what's going to happen when the robots come for all our jobs. There's one basic error in the piece and one slightly more technical.

The basic error is that they fail to note that when the robots have taken all our jobs then we'll all be incredibly rich. One of the comparisons they make is to the first industrial revolution and that's appropriate. So, let us think about what happened when the mechanisation of cotton production killed off the hand weaving (and linen although more slowly) industries. Yes, certainly, some people lost their jobs: but the entire population now became rich enough to be able to wear cotton underwear simply because the production costs of cotton fell so far. And only those who have suffered through the woollen kind will know how rich that makes us all.

It's a very, very, basic observation: if the machines are making everything then everything becomes extraordinarily cheap. This is the same statement as the one that the machines taking all our jobs makes us all very rich indeed.