There are plenty of stories you can tell that are pretty compelling about this.  For example there are towns in China today that make only buttons, and other towns that make only copies of classic oil paintings, etc. etc.    Everybody knows that Silicon Valley has something in the water that means that only there can you do high-tech.

But recently I’ve gotten to wondering, maybe this isn’t true.  Cities, as a economic model, lost much of their competitive advantage with the introduction of the phone (which undermined

the manager’s need to be on site), electricity (which undermined the requirement for power/coal to be delivered via flat water), and modern transportation (which undermined the requirement to walk to work).   Once those all set in the city centers dissipated.  And thus, the golden age of American cities ended.  Is that process over?  I think maybe not – the way that the internet has enabled distributed work is a good example of the ongoing process.

How might we measure this?  Apparently Paul Krugman suggested some time ago the seemingly obvious idea that you just compare “the sum of the absolute differences in industry shares of employment between the two regions.”  (page 12)  And in 1998 this paper was published with this chart that shows the historical trends in regional specialization in the US.   Notice first the bottom line – retail trade; all regions have some retailing so that isn’t concentrated.   Then notice the top one; apparently the least urban activity is the one that is trending toward increased regional specialization.  I certainly didn’t expect that.

What leaps out at me here is the way the rise and fall of regional specialization in manufacturing appears to be so correlated with the gold-age of American cities.

I think I was right at the time.  Wrong about my choice of cities; San Francisco beat Boston – a lot.  I remain unconvinced that we know exactly why though.   These days I still think it is good advice to the young, go someplace where there is an existing network of people doing what your interested in.  But, that said, I think it’s less critical than it used to be.   And, I’m totally confused about that agriculture trend line.

The shedding genes appears, at first glance, to be very short sighted.  My house is full of stuff I’m not going to need tomorrow; but yeah I retain to insure against the possibility I’ll need it next week.  The bacteria have stumbled on solution to this problem, they steal genes from each other.  In fact they do it a lot, the percentages are huge.  I think this is amazingly cool.  The community can, and will, shed the gene for antibiotic resistance quickly; but if only a handful of the community retain it then the community can survive the reintroduction.   I do that too.  I discard stuff in my house because I know I can recover it from the city around me.

Much fun can be had with this.  For example here is a fun essay on the evolutionary history of the directories in my Unix PATH.  At each point in time it seemed like a good idea, solved a problem; but now we carry the complexity around.  The essay is written by somebody who is under very different evolutionary pressures; so he’s trying to shed those genes.

I’m reminded of how the 1984 macintosh shed the genes for memory management, because it wanted to reproduce more quickly than the Lisa.  Getting that gene back wasn’t easy, but the design pattern certainly didn’t get lost.

The dialectic between reproducing fast and remembering and copying all the important design patterns is a key challenge in any new product.  It is the curse of experience that you have a deeper catalog of design patterns you feel you must decide if you will or won’t pack them into today’s new product.  I’m always a bit bemused by how casually presumptive some people are about the absolute necessity of packing in this or that thing.   For example: first customer contact v.s. QA?  For example: delivery or modularity?  For example: features or cross platform.

The answer tends to fall out of the R-selected v.s. K-selected nature of your business ecology.   It’s part of what makes small businesses radically different from big ones.  Which reminds me of who eats the bacteria.

So in this amusing game of analogy what plays the role of antibiotic.  QA is a kind of antibiotic, but I think a better example would be the skills that organizations need to have to defend themselves from the dark arts – i.e. the agents that immunize the organization against the numerous bad ideas found in the business cults.

And then finally, let’s says something about how the bacteria draw upon their community much as I draw upon the city around me.  In a business context I think that explains a lot about the survival value that comes from situating your small business inside a geographic region or virtual community from which you can draw in the craft knowledge you’ll probably shed in exchange for fast growth out of the box.

Poor Sheldon is #16 on the Fortune list.   There are 112 million households in the US, so Sheldon’s worth is $191/household.  He made his money in the Casino business.

What percentage of the top .1% are going to decide to toss .02%, or even 1% of their net worth into this?

Here’s another power-law.

Apparently the distribution for the interval between epileptic seizures is a power-law.  The long intervals are rare.  There are lots processes that give rise to a power law distribution.  The proposed model in this case involves a cascading failure in the  network of neurons.

I don’t think this next paper has undergone peer reviews, but in  this paper they look at the interval between a serial killer’s murders.    That’s a thin data sample.   The interval between his crimes is power-law distributed.

Interesting example of impulse control, will power power, etc.

I wonder if we have other data on brainstorms?   Brainstorms of a less horrific kind:  interval between blog posts, emails, phone calls, code commits, sales closed, etc. etc.   What if we took the top hundred poems Robert Frost wrote and measured the interval between their creation?    Would we see that as power law distributed?  With enough data we could probably look into the effect of coffee on brainstorms.

The vertical axis on this chart is a measure of how likely you are to have an income that differs from that of your parents.  The horizontal line is the usual measure of income inequality.  So if you live in the UK or the US I recommend picking good parents.

The hubs are fascinating.  Imagine there is a single hub, and every update about everything is sent thru that hub.  If you were that hub you could see all kinds of things.  Well we sort of have a hub like that already.  Some years ago the blog community gin’d up a way to push notifications about updates to hubs.  A second generation approach to that problem emerged after a while, that goes by the unwieldy but amusing name PubSubHubbub.  Publishers send notifications to the hub and subscribers get (or pull) notifications from the hub.

FrackIM is a demo of Bob calls prospective search.  It allows you to set up various search patterns and then when something “goes by” it will immediately send you an notice about it.   I hear you asking, “‘Goes by’ where?”     Imagine that it goes by in a chat room.  And who is in this chat room – well everybody who is pushing updates to PubSubHubbub.  So roughly you can listen in on everything that’s happening.   This is not quite true because the FrackIM demo is only listening to a small subset of the total traffic; that’s configurable in the source though.   FrackIM can to this because Google has services available do prospective search on that traffic; in actually FrackIM is a thin overlay on that functionality.   That’s a fine example of the kind of services I long ago described as likely to emerge in the big cloud operating systems.

If you’d like to play with FrackIM then you just add frackIM@appspot.com to one  your xmpp (jabber, gtalk, etc.) IM accounts; and then type: “/help”.   Then if you want to get updates about energy type: “/subscribe energy”.   Of course if you don’t subscribe to anything it’s pretty quiet, in fact I assume it’s totally quiet.  If you want it be noisier then try subscribing to a common word: “/subscribe a”, (though I think it’s actually subscribe to the letter a).  FYI I’m currently subscribed to #huh, meet you there.

Wit, ah wit.

Good fun making up insta-theories(tm) for this.  I wonder if the PR industry has determined that the majority of the target audience things wits are twits?  No doubt campaign consultants fear spontaneity so much they suppress all wit.   Individuals have their preferred subspecies of wit, Dickerson likes wit, maybe these guys all prefer sarcasm or slapstick.  And then maybe Jon Steward locked up the supply of good comedy writers?

Presumably there are two or more faces on each candidate.  The face he shows on national television, the one he shows off the record on the press bus, the one he shows when pressing the flesh with the voters on the streets, etc. etc.    And no doubt they can be more witty in some of these contexts than others.  John would appear to be telling us that these guys aren’t even witty on the press bus.

Let us not forget.  Accusing the loser of being humorless, angry, and depressed is a cheap, but effective, shot.

You need to act quickly.  Otherwise you get a bank run.  As long as the liquid assets are in bank accounts swapping them from the old to the new currency is a straight forward procedure.  Same for your bonds, loans, contracts, etc.  If the liquid assets are in people’s wallets it’s more tedious to swap in the new currency.  I doubt it’s effective to announce that the old currency is no longer legal tender.  But, since it’s likely that your purpose in exiting a currency union is to regain control over the money supply.

Let’s assume your exiting the union because your economy is being forced into a depression because you lost control over you money supply.  In that case you probably want to flood the market to increase the money supply.  So you can push a lot of your new currency into the system; and gain some traction due to the way bad money drives out good.

I got to thinking about how to do the switch quickly.   If anybody discovered that you were printing up fresh Drachmas it would trigger the bank run.  I’m greatly amused by the idea that creates an opportunity for some risk loving entrepreneur, let’s call him Bob.  Bob secretly prints up huge batch of replacement currency.  He transports it to the capital of the country and knocks on the door of the Treasury.  He explains: “If you decide you need to act, here’s my number – I’ve got just what you need.”  Even if Bob’s offer leaks it’s not the same signal to the market as the news that the Treasury has commissioned a new currency.

Then I found my self wondering, well, what might you do if you had the chance to redesign a currency from scratch?  None of these ideas seem likely; but they are fun.  For example you could decide that the entire credit/debit card system is stupid and nationalize it.  I consider it amazing that we have allowed private entities to tax a large percentage of all transaction.  For example you could decide that you wanted all transactions to be anonymous, or conversely that you wanted all of them to be public.  These choices all play into your tax system’s architecture.

None of these radical currency redesign ideas are likely given the need to act fast and in secret.  But then, just maybe Bob could figure out a way to sweeten his offer by bundling in one or more of these.  Which brings me to my most depressing thought.  Does Paypal have a team working on this?

So we now know that income inequality has high social costs, or to say it in a more technical way inequality is negatively correlated with social welfare.  I don’t know that that would surprise most people.    A society where the lower classes are more distant from the upper classes is going to have greater social stress – at least I don’t see that as surprising.

But what else is income inequality correlated with?    There is a very scary possibility:  That inequality drives greater economic growth.  Not hard to make up an insta-theory for that: e.g. that the social gradient drives people to strive, and this drives significant economic growth.

That would be really horrific.   A Hobson’ choice: pick one economic growth v.s. social well being.  Societies that grow faster carry their social norms carried along with them.  They become the standard.

Which is why it’s a very important question.  And you’d think there would be libraries full of research on this question.  There is not.  Pick your insta-theory for why that is.   As far as I can tell the data seems to suggest that growth and inequality are largely related.  But, it is very frustrating not to be sure.