Category: Creative Destruction

OUP Offers Free Download of Chap. 9: “Innovation Bound or Unbound by Culture and Institutions”

Oxford University Press (OUP) has created a list of 6 books they recommend on business innovation. If you follow the link below, you can download a free PDF of Chapter 9 (“Innovation Bound or Unbound by Culture and Institutions”) of my Openness to Creative Destruction: Sustaining Innovative Dynamism. Alas, I think the free download is only available through February 29, 2020. (Chapter 9 is not my favorite chapter, but free is free;)

My book is:

Diamond, Arthur M., Jr. Openness to Creative Destruction: Sustaining Innovative Dynamism. New York: Oxford University Press, 2019.

No Evidence Base that Smartphones Cause Anxiety and Depression in Teens

(p. B1) SAN FRANCISCO — It has become common wisdom that too much time spent on smartphones and social media is responsible for a recent spike in anxiety, depression and other mental health problems, especially among teenagers.

But a growing number of academic researchers have produced studies that suggest the common wisdom is wrong.

The latest research, published on Friday [January 17, 2020] by two psychology professors, combs through about 40 studies that have examined the link between social media use and both depression and anxiety among adolescents. That link, according to the professors, is small and inconsistent.

“There doesn’t seem to be an evidence base that would explain the level of panic and consternation around these issues,” said Candice L. Odgers, a professor at the University of California, Irvine, and the lead author of the paper, which was published in the Journal of Child Psychology and Psychiatry.

For the full story, see:

Nathaniel Popper. “The Menace of Screen Time Could Be More of a Mirage.” The New York Times (Saturday, January 18, 2020): B1 & B6.

(Note: bracketed date added.)

(Note: the online version of the story has the date Jan. 17, 2020, and has the title “Panicking About Your Kids’ Phones? New Research Says Don’t.”)

The Odgers paper, mentioned in the passage quoted above, is:

Odgers, Candice L., and Michaeline R. Jensen. “Annual Research Review: Adolescent Mental Health in the Digital Age: Facts, Fears, and Future Directions.” Journal of Child Psychology and Psychiatry (published first online Jan. 17, 2020).

The Creative Destruction of Broadcast TV by Streaming, Increases Variety

(p. B4) It has been on a steep upward trajectory for years, and in 2019, it finally happened.

There were more than 500 scripted television series in the United States last year, a high. The estimated number: 532 comedies, dramas and limited series that were broadcast or streamed, according to the research department of the cable network FX, which tabulates and releases the figure every year.

It marked the first time the 500-show threshold had been crossed, representing a 7 percent increase over the number of scripted shows in 2018.

The 2019 total was 52 percent more than the 349 shows that existed in 2013, the year that streaming started to become a habit for many viewers, with the debut of “House of Cards” on Netflix. And it’s a jump of 153 percent over the 210 series available in 2009.

For the full story, see:

John Koblin. “It’s Not an Illusion: Peak TV Is Showing No Signs of Slowing.” The New York Times (Saturday, January 10, 2020): B4.

(Note: the online version of the story has the date Jan. 9, 2020, and has the title “Yellow or Blue? In Hong Kong, Businesses Choose Political Sides.”)

Jobs Return to “Creative Destruction Parts of the Country”

(p. B5) “If you look, there are a heck of a lot of successful manufacturing parts of the country right now,” Kevin Hassett, the departing chairman of the White House Council of Economic Advisers, said in an interview. “But look at where they’re being created.”

Mr. Hassett drew a distinction between “creative destruction” parts of the country, where the Great Recession wiped out jobs but others sprung up to replace them, and “destruction-destruction” parts, where jobs have been slow to return. Recent factory job growth, he said, was “not necessarily disproportionately in the destruction-destruction places.”

For the full story, see:

Jim Tankersley. “Growth in Factory Jobs Skips Traditional Hubs.” The New York Times (Friday, June 14, 2019): B1 & B5.

(Note: the online version of the story has the date June 13, 2019, and has the title “In the Race for Factory Jobs Under Trump, the Midwest Isn’t Winning.”)

Art Carden Praises “Openness to Creative Destruction”

Economist Art Carden has written a fine review of my Openness book under the title “New Ideas Are the Key to Economic Development.” The review is fair, mostly positive, and well-written. His main reservation is that he sides with many other distinguished libertarians, but against me, on my argument that the patent system should be reformed rather than abolished.

Here is the final paragraph of Carden’s review:

I am glad to see Openness to Creative Destruction appear in print. It strikes a fine balance between detail and a big-picture perspective that, I think, can be read profitably by specialists and students alike. Anyone who wants to understand how the world grew rich and, importantly, what will sustain our enrichment would do well to have this book on the shelf.

Boudreaux Names “Openness” as One of Seven “Superb” Books Published in 2019

George Mason economics professor Donald Boudreaux, in his essay “Some Great Books for Stuffing Stockings” says “I offer here a list of seven superb books published in 2019 that your open-minded friends and family members are sure to love.”

I am honored that he included my Openness to Creative Destruction as one of the seven:

Arthur Diamond, Jr. Openness to Creative Destruction: Sustaining Innovative Dynamism. As does George Will, Diamond emphasizes the vital role played by individual entrepreneurs in helping to create modern mass prosperity. (The accounts of the challenges and efforts of flesh-and-blood entrepreneurs through the years is alone worth the price of this book.) And as does Deirdre McCloskey, Diamond recognizes also the importance of widespread respect for innovators and businesspeople. Making clear that modernity’s prosperity is the result of creative destruction, this book offers an unusually effective and powerful explanation of genuine market competition and a brilliant brief for its indispensability and for its goodness.

Openness on Display at Oxford Booth at AEA Meetings

Founding Entrepreneur Still Runs FedEx

Clayton Christensen plausibly argues that in the rare cases where an incumbent firm has been able to disrupt itself, it is almost always a firm where the founding entrepreneur is still running the firm.

(p. A1) MEMPHIS, Tenn.— Fred Smith bristles at any hint that FedEx Corp., the global delivery giant he built over four decades, could be disrupted by a player such as Amazon.com Inc.

. . .

FedEx’s 75-year-old chairman and chief executive, the man who pioneered the business of moving packages around the world at lightning speed, is confronting some of the greatest threats to the company he founded.

Global trade is slowing and tariff (p. A9) fights have companies rethinking supply chains. A key partner, the U.S. Postal Service, is struggling. Amazon has morphed from a customer into a competitor.

. . .

Mr. Smith, a former Marine officer and decorated Vietnam War veteran, started FedEx in 1971 and has been CEO for nearly its whole history. The billionaire was preparing to hand over the reins, but he extended his stay after two top executives, including his heir apparent, abruptly left.

That has left Mr. Smith, who remains one of FedEx’s biggest shareholders, to revamp the business. He started with divorcing Amazon.

For years, Amazon has been building up its logistics operations to handle more deliveries itself. The online retailing giant added tractor-trailers, hundreds of sorting centers and dozens of cargo planes to carry millions of its packages. It now delivers nearly half its orders, compared with less than 15% in 2017, according to estimates from research firm Rakuten Intelligence.

In February [2019], Amazon noted in its annual report that it views companies in “transportation and logistics services” among its rivals.

“They had never done that before that day,” Mr. Smith said. “So we took it seriously.”

For the full story, see:

Paul Ziobro. “FedEx Chief Reinvents Firm He Founded.” The Wall Street Journal (Friday, October 18, 2019): A1 & A9.

(Note: ellipses, and bracketed year, added.)

(Note: the online version of the story has the date Oct. 17, 2019, and has the title “Fred Smith Created FedEx. Now He Has to Reinvent It.”)