The title of this post surely seems somewhat strange. Surely any self-respecting business should be in the interest of making as much profit as possible, and the temptation might be to extract as much as you can from each customer interaction. But we know that such views can be too short-term. In many situations, while …
Google is putting the "auto" into automobile
If the last big revolution was replacing muscle power with machines, the next one is automating and augmenting more mental tasks. Henry Ford and compatriots replaced the horse, now Google is working to replace the driver. According to John Markoff in the New York Times, their self-driving cars have now logged over 140,000 miles on California …
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Business class vs. Economy online news
Newspapers like the New York Times and Wall Street Journal are currently experimenting with paywalls that prevent non-paying customers from accessing some content. But what if all customers could access the same content, but the "economy" (i.e. free) visitors saw ads and other clutter while the "business class" customers got a cleaner experience? Would that be a viable model? …
Pay what you want experiments. From Stephen King to Kickstarter
Back in 2000, Stephen King tried something new in selling a novel, The Plant. He decided to offer it exclusively online — in digital format — knowing that there was effectively no protection against copying. Of course, King was well aware that selfishness may be against him and so decided to offer his book in installments. …
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Finding Yahoo's way
Last year I had the pleasure of presenting a seminar at Yahoo Research. One of the things that interested me about that part of Yahoo was the fact that it had, in my field of economics, made some very significant hires from academia. In a time where some academically oriented labs had fallen aside, Yahoo …
The Kindle does not want to be free
In 1974, hundreds of thousands of Australians with a bank account in good standing received a piece of plastic in the mail: a credit card, known as a Bankcard, launched and operated by a consortium of Australian banks. In one swoop, a payment instrument that had been previously available to only the wealthy in Australia (through …
Al Roth, Market Designer
Al Roth has been doing fascinating work designing matching markets. These include the markets for matching kidney donors and recipients, medical residents to programs, and assigning students to schools. In these markets, small changes in the "rules of the game" can lead to big efficiency gains, and it's not always obvious how to best make those …
The Missing Market for Failure
We are told that some large fraction (possibly 80 percent) of small, entrepreneurial businesses fail. The hard part is working out why. You may notice a restaurant has closed in your neighborhood. If it seemed popular, you wonder if the owner left for greener pastures or there was some hidden health issue no one had …
Is Paul Krugman 'Click Worthy'?
The New York Times has just proposed to turn us all into Seinfeld's Elaine Benes. In episode 119 of the classic sitcom, Elaine's preferred method of contraception is revealed to be the sponge. When the sponge goes off the market, she must come to terms with the fact that whatever stock she had in her possession was it. She could …
Facebook is the largest news organization ever
Upon reading the title of this post I suspect your reaction is, "Really? I didn't even know it was a news organization." And that reaction is precisely why many people look with disbelief at the extraordinary estimates of Facebook's value. Facebook is not some plaything. It is a fully fledged news organization on a scale we have …
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