Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: sditto who wrote (32373)	9/27/2000 8:16:08 AM
From: Judith Williams	Respond to of 54805

One should certainly note Paul Krugman's rather strong dissenting opinion... Strong is right. But Krugman is uncharacteristically obtuse or deliberately misleading in Networks and Increasing Returns: A Cautionary Tale. Increasing returns are, of course, more fun to think about--but that is itself a reason for caution. "New economy" types have a tendency to tell great stories, both about the economy and about themselves. Alas, the fact that a story is entertaining doesn't mean that it is true. Brian Arthur and Ken Arrow have never claimed that increasing returns are automatic, only that they occur in complex systems under certain conditions. Introduce famine or plague into a population or draught into a fragile ecology, and the system fails. The same goes for economic ecosystems. Without critical mass, they cannot sustain equilibrium, much less prosper. Technological disruption or corporate mismanagement can move them below the critical mass needed for sustainability. When that happens, they wither. Krugman has made "self-organizing" systems a study. Maybe his nose is just out of joint from not getting an invite to Santa Fe from the great poobah at MIT. Regards, Judith