Wealth vs Capitalism

[crazy canuck]

Why did consumers choose VHS over Beta.   Lots of theories as to why an inferior quality tech won out.

But one thing is certain, inferior tech can come to dominate

[HVC]

Why did consumers choose VHS over Beta.   Lots of theories as to why an inferior quality tech won out.

But one thing is certain, inferior tech can come to dominate

the story i heard was porn. VHS beat beta to porn. Give the people what they want

[The Minsky Moment]

VHS was cheaper
Sony was slow to license whereas JVC encouraged licensing. 

[Valmy]

Sony was slow to license whereas JVC encouraged licensing. 

That was the reason my family dumped Beta eventually, despite being early adopters. The VHS section of the rental store was huge while the Beta was a tiny section in the corner. You were pretty much forced to get VHS since the Beta selection was small and never really got bigger.

[HVC]

VHS was cheaper
Sony was slow to license whereas JVC encouraged licensing. 

Sony won the dvd wars a few decades later. Alls well that ends well

[The Brain]

My impression is that there are many cases in history of owner-run companies producing good products. It is not obvious to me that passive owners is preferable. "Musk bad" doesn't add much to any discussion.

[Sheilbh]

Parts of it remind me of Tyler Cowen's "great stagnation" theory (I imagine he'd disagree with much else) that we have, in effect, got the low hanging fruit of innovation that increases production and efficiency already. We're now fighting in the shallow end over diminishing returns - until there is another burst of innovation and who know what that will actually be. I'm not totally sold but I think there is something to it.

I slightly disagree with his point on Tesla - or that Tesla is important on this. I've mentioned before but I think our visual language and design choices have largely flattened. I don't think this is because of globalisation in general - but the spread of smartphones as a medium of globalisation. But design aesthetics seem to be converging everywhere - whether it's architecture (especially with the superstar architects doing big public projects), cars, fashion, phones, it is all becoming samey and interchangeable. To an extent that's one of the inefficiencies of capitalism that it most naturally iterates what is already successful (most extreme, for example, in pharma research). I'm not sure it's great - I really enjoyed an Economist piece recently on the decline of the small car as the end of a certain Europe - but in part that's because I don't think what we're seeing is the emergence of some form of global taste but levelling down of choice and difference.

I get this is controversial and there are problematic uses of it - it's been adopted in a bit of a red-brown alliance (which I think gets it wrong), but I think ideas around the professional-managerial class might help with some of his points.

I also think there needs to be something about close to zero interest rates because I think that is a part of what's been going on with wealth and capital that he draws out. I think the days of vast sums of money from VCs for businesses that don't make money and for businesses that are basically premised on becoming a monopoly are over. And I think that will shift the balance and change where money is invested and for what ends.

But I think the point of maybe needing to return to capitalism is not a bad way of framing things - although I'd possibly frame it as a return to modernity more broadly, but I'm not sure how possible it is in our world or if we need something new to emerge. I think, on Musk specifically, the techno-feudal argument is really exemplified in the recent Ronan Farrow piece in the New Yorker because his description of Musk stepping in to create infrastructure (Starlink, EV networks, boring etc) is exactly the feudal sort of arrangement that used to exist before the state. I think the weakness of capitalism he talks about is mirrored by a decline in state capacity - not into a new, exciting global age but something that is global but resembles pre-modernity. And I think Marx might not have been a capitalist but he was absolutely a modernist.

Edit: And I think that professional-managerial class point is perhaps particularly  important in the US where something like 70% of equity is owned by institutional investors - I think it's also a challenge for our traditional, consumer-focused understanding of competition law.