Monthly Archives: February 2014

Winner’s Blindness

I wanted to give a short follow-up to my post a few months ago: How-fair-is-the-game-of-monopoly/.

I watched a thought provoking TED talk the other day, in which the presenter had filmed experiment subjects playing a particularly rigged game of Monopoly, in which one of the players (randomly selected) started with more money, and was allowed multiple turns for each of their ‘poorer’ opponent’s turns.

Over the course of the game, the richer player, who unsurprisingly outperformed, began to change their behaviour, adopting aggressive language and gestures and eating the lion’s share of the provided pretzels.  And on being interviewed after the game, they were far more likely to talk about how their decision making had contributed to the result than to acknowledge any unfairness in the situation.

I’m not at all surprised by this behaviour – I have noticed it often – whether from traders who come up with reasons to justify their success (luck couldn’t have anything to do with it!), men who don’t believe gender disadvantage exists in the workplace (or if it does, it is against men), or those who believe that poverty is largely caused by the poor not working harder.  It is human nature to prefer the stories that comfort us to those that might make us feel a little bit less righteous.

There’s a lesson in this that we should recognise the bias in our view – that our success is more due to chance that we’d like to think.  But I think there’s also a lesson against believing those ahead of us (e.g. politicians, business leaders) are unlike us, that they are extraordinarily greedy, uncaring, and willing to put down others to get ahead.  We’re all human, and only a dice roll away what I might label ‘winner’s blindness’.

For the full video, go to

Listening to Podcasts

When I was younger, I used to really struggle paying attention to any talk or audiobook, but thankfully, as I’ve aged, my brain has become a bit better at focussing on listening.  As a result, I now enjoy several hours a week listening to podcasts as I run in the park or walk to work.  There are so many great podcasts out there that expose me to new ideas in an engaging and entertaining way, that it is no longer just a way to fill the time, but often the main motivation to do the exercise in the first place.

The week before last, London experienced major public transport strikes so I walked to work even more than usual, so I thought I’d write a post about the podcasts I listen to and why.

I listen to podcasts (and read) for several reasons:

  • an opportunity to think more deeply about things I’m interested in
  • to keep up with the latest news on topics that are relevant to my career
  • to expose myself to challenging points of view
  • to hear good ways of explaining complicated topics
  • to discover interesting things that I might not otherwise have heard about
  • to discover books I should read, or people I should learn more about (or even other podcasts to subscribe to)

The first few podcasts are ones that help me think deeply about topics I blog about (all the podcasts I mention are free and available in the iTunes store):

  • EconTalk is hosted by Stanford University economist Russ Roberts, and each week features an hour long interview with someone from the world of business or economics about a book that they’ve written.  I don’t always agree with Roberts or his guests (but then again, they don’t always agree with each other!), but it is intelligent conversation and certainly gets me thinking on some big topics (e.g.  freedom, government, education) and as well as more specific topical issues (e.g. bank bailouts), and often inspires me to want to read the book the author has written.
  • Harvard Business Review Ideacast offers about 5 quarter-hour interviews each month, mostly with authors of articles in the magazine.  I’ve been listening to it for almost 5 years, and though I’m selective in which podcasts I listen to, I’ve enjoyed learning about business leaders, business thinkers, companies, or workplace issues that I might have otherwise missed.
  • Best of the Left is the most uncomfortable podcast I listen to, but I feel it is crucial to me.  It covers a lot of issues like capitalism, the role of business, inequality, and environmentalism, all from a left-wing perspective, which isn’t the perspective I’m used to taking.  I don’t want to be guilty of just listening to arguments that make me feel comfortable with my place in society, and I know if I thought honestly and compassionately, I’d probably agree more with the Best of the Left arguments than I currently do.  I still listen critically, but at least I want to make sure that those arguments I disagree with, I do it having heard and understood them argued at their best.
  • Ockham’s Razor is an Australian Broadcasting Corporation weekly programme that provides an opportunity for people with interesting things to say about science and technology to have their 15 minute opportunity.  I’m selective in which episodes I listen to, but find it valuable whether on a familiar or new topic.  As an Australian abroad, it is nice to hear an Australian perspective on things ‘back home’.

Next, since I spend much of my life explaining business and economics, I listen to a couple of entertaining business / economics podcasts to hear good ways of presenting content to a wider audience.

  • NPR Planet Money is a very entertaining, New York based show that aims to bring economics to a wider audience, but doesn’t hide the complexities or the contradictory arguments.  Quite often discussions end in a statement that “We just don’t know” or “only time will tell”, which I prefer to bold conclusive statements that the media so often prefers.
  • Freakonomics Radio is a show by Steven Levitt and Stephen Dubner, which, like their books, aims to show that economic thought is part of our everyday decision making, and highlight the truth behind our reasoning.  Again, it seeks to challenge the listener to see that things are less clear than we might otherwise think, and that the key isn’t about whether to use economics or not, but whether to use it well or badly.
  • More or Less is a BBC radio show often hosted by ‘Undercover Economist’ Tim Harford.  It is in many ways similar to Freakonomics,  highlighting that just because a story in the media quotes statistics, it doesn’t mean that it is reliable.  It might be a bit more ‘matter of fact’ than Freakonomics, but I appreciate the fact that it exposes me to UK media and politics which I confess I usually do my best to avoid.

And a few podcasts that I listen to for other reasons:

  • Guardian Tech Weekly is about half an hour long, and covers the latest technology news along with one or two longer interviews on relevant issues.  I listen to it most weeks, and find it a good way to keep up with what’s happening.
  • Despite my increasing consumption of podcasts and blog posts, I do still love reading good books, and care about their production and discovery, so I keep an eye on the Guardian Books Podcast for episodes on topics of interest to me.  I might only listen to one episode a month, but there have been books that I’ve discovered on the show that I’m glad I caught.
  • My Christian faith is important to me, and I do like to spend some time listening and thinking about it, being challenged to keep it in mind.  Just as different churches cater for different people, it is easy to find Christian podcasts off-putting in their approach (e.g. too academic, too simplistic, too childish, too revolutionary, too insignificant).  I discovered John Wright’s sermons at Trent Vineyard almost a year ago, and find them insightful, intelligent and challenging in a way that I am grateful for.
  • Probably the most popular of all the podcasts I listen to is TED Talks (though to be fair, it is best in video format than audio).  For the few readers who haven’t heard of it, it allows thinkers and achievers (in a far wider range of fields than just the Technology, Entertainment and Design which gives TED its name) a 5-15 minute chance to tell an informative, inspiring and sometimes transformative story (it even changed how I tie my shoe laces!).  It is sometimes criticised as leading people to ignore ideas that can’t be sold in a 10 minute emotional message, but if so, that’s a fault of the listener, not the message.  In my case, there have been countless ideas and people that that I first heard at TED, that have gone on to inspire further reading and significantly affect my views on the world.

What we pay isn’t what we get

This was going to be a self-contained post, but as so often happens, my thoughts expanded to the extent that I’ve had to settle for just providing some introductory thoughts on two related topics that I’ll have to continue in future posts.

Over the past few months, I’ve read a few articles about problems with our use of GDP, or Gross Domestic Product, which I (very loosely) define as the amount of money spent on final goods and services produced in the country in the year.  There are lots of things wrong with it (many of which are documented on, but my biggest concern is that the fundamental weight given to what is spent.

In other words, GDP measure what is paid, and ignores how much we value what we get, making it a questionable measure of anything that we should focus on, let alone strive to increase.  As prices for things go up, GDP rises, and as prices come down, GDP falls, neither of which says much about the economy’s performance or our well-being.  I’d rather see us maximising our well-being and perceived value than maximise the amount that is spent.

The difference between what we pay and how we value something (usually positive, otherwise we wouldn’t have chosen to pay it) is what economists call consumer surplus.  If it was small and constant, ignoring it wouldn’t be such a big deal, but I believe it is growing to be a very significant part of our economy.

The main reason for that is that more and more of the things we consume have minimal marginal cost.  High school economics tells us that these things should end up being free, or close to it (otherwise a competitor will undercut them).  Much of the internet falls into this category – for example Wikipedia, Facebook, Google, youtube contributors and many wonderful blogs and articles.  It also includes cultural and environmental assets – you can’t make an opera house, a public library or a national park not exist for those people that don’t pay for it, nor would you really want to.  (You can stop people using them, but I consider cultural and environmental assets to have significant value to people just by existing).

A second reason is due to inequality – the richer we are, the more (in dollar terms) we will value most things.  Yet there are great difficulties in pricing things on a differentiated basis, so the consumer surplus of the wealthy is increased.

So, the first topic that I want to think about over the coming weeks is how by focussing too much on what is spent, we’re ignoring the massive contribution to our wellbeing of things we don’t pay for, or at least, pay nowhere their full value.  I’d like to see society and our policies doing more to recognise and encourage these things that enrich our lives, rather than implying that what isn’t paid for doesn’t count.

Secondly, I worry that the difficulty in putting a price on these things may make them unsustainable, and hence disappear.  For example, I’m a huge fan of bookshops, and value their contribution to my life, but I buy all my books as ebooks, so I don’t give bookshops any revenue.  I’m not going to buy paper books I don’t want, but I’d feel sad if all the bookshops closed.

At the moment, I’m seeing some encouraging innovation.  One of the blogs that I read ( very successfully introduced a subscription model a year ago (though you can read a certain number of articles for free each month).  Interestingly, a large number of subscribers (including me) choose to pay more than the minimum subscription fee of $1.99 a month, showing willingness to reduce their consumer surplus to ensure the blog is sustainable.

But I worry that this innovation isn’t going to be enough to sustain so much valuable work in society, and economic pressures will steer people away from this activity to less valuable work that is easier to be paid for.  This is a challenge that we need to think about, so I’ll be writing about it in future weeks.  If anyone has any good reading / listening recommendations on this topic, I’d certainly be grateful.