April 2017

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ESPN layoffs, and the creative destruction of sports capital

On Wednesday, ESPN, the sports broadcasting behemoth, laid off dozens of employees. Some were highly recognizable on-air personalities. Others were lower profile reporters and journalists. It’s a visible demonstration of the free market’s powers of creative destruction. ESPN has decided it no longer gets sufficient return from its own marginal talent It’s tough to think of layoffs
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Status quo bias, and the uncertainty of your success

Tyler Cowen, an economist and author, thinks our preference for the status quo is one of our costliest biases. I heard him make that claim in an interview he did with Ezra Klein. It’s easy to frame status quo bias as a form of risk aversion. And I think that’s right. Change is risky. We
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Profit vs. margin, being precise when it's easy to be sloppy

Let’s take a quick detour through some financial vocabulary. Specifically, let’s draw a distinction between profit vs. margin. What’s profit? It’s the dollar amount by which revenue exceeds costs. Profit and income are synonyms, when we talk about corporate financial performance. The only trick with profit is knowing which revenue stream, and which costs, we’re considering. What’s
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