Posts Tagged ‘Internet’
One may imagine that economics has little bearing on the more frivolous frontiers of everyday life; but in fact it explains why one consumes so much “animal antics” online and so little Shakespearean seriousness…
Economics sometimes has surprising applications. One example is the Alchian-Allen theorem, an observation that came from a footnote in an economics textbook in the 1960s about how quality demand is affected by transport costs…
The Allen-Alchian theorem explains why places with high-quality produce (Allen and Alchian had in mind apples in Seattle, which is where apples come from in the US) nevertheless do not always get to consume that same high quality (they pointed to the market for apples in New York city, where no apples grow) because of the relative costs faced by consumers in each case (for New York consumers, a high-quality apple, once you account for transportation costs, was actually relatively cheaper than a low-quality apple compared to relative prices in Seattle). Hence the market sent the high-quality apples to New York.
You’re still with me? It’s all about relative costs. When you move something, or impose any fixed cost, the higher-quality item always wins, because it now has a lower relative cost compared to the lower-quality item.
The interesting idea is that this also applies in reverse – namely when we remove a fixed cost. The internet does this: it removes a cost of transport, and it does so equally for high quality and low quality content. Following the Allen-Alchian theorem, this should mean the opposite. Low-quality items are now relatively cheaper and high-quality items are now relatively more expensive. This idea was first explained by Tyler Cowen, but the upshot is that the internet is made of cats…
The internet lowers the cost of “transport” for every idea, high and low quality alike. It’s the opposite of the apples situation. It means that low quality apples are now relatively cheaper. It means that cats-doing-funny-things is now relatively cheaper than say German Opera. Economics insists that when demand curves look like this we can expect more cat watching, and less German opera watching.
This theorem means that we expect a lower quality, “bittier” consumption to proliferate on the internet (as a technology that lowers transport costs of high-quality and low-quality ideas alike). Which is what we observe. So that’s a win for micro-economic demand theory.
Is this really what’s happened? Have we all gotten dumber? Read more– including the arguments, pro and con– at “The internet is made of cats – and you can blame economists“: and read the paper the lays out the “economics of cute” in “The Alchian-Allen Theorem and the Economics of Internet Animals.”
* John Kenneth Galbraith
As we come to terms with the fact that all our bases are belong to them, we might spare a slightly skewed thought for Giuseppe Arcimboldo; he died on this date in 1593. An Italian painter best known for creating partraits composed entirely of such objects as fruits, vegetables, flowers, fish, and books, he is considered a Mannerist… though he might well be the first Surrealist. He was certainly cited by many– from Dali through Ocampo to Švankmajer– as an influence.
In preparation for “treat-ing” tonight’s parade of freaks, one might pause to pay respects to 2600: The Hacker Quarterly, an American publication that specializes in publishing technical information on a variety of subjects including telephone switching systems, Internet protocols and services, as well as general news concerning the computer underground. The magazine’s moniker comes from the “phreaker” discovery (by John “Cap’n Crunch” Draper and friends in the 1960s) that the transmission of a 2600 hertz tone (which could be produced perfectly with a plastic toy whistle given away free with Cap’n Crunch cereal) over a long-distance trunk connection gained access to “operator mode” and allowed the user to explore aspects of the telephone system that were not otherwise accessible… like free long distance calls. (The seed money for Apple was in part raised by the two Steves’ sale of “phreaking boxes” designed to do just this.)
2600 has become a journal-of-record for “Grey Hat” hackers– tech explorers concerned to push past the limits inherent to the design of a given technological device or application (as opposed to White Hats, who are ideologically motivated to do good, or Black Hats, who pursue selfish– often illegal– gain). So its current editorial focus is largely on the web and its devices, increasingly on mobile implementations and application.
But 2600 honors its roots, among other ways, by maintaining a gallery of photos of payphones around the world; for example…
As we wax nostalgic, we might send illuminating birthday greetings to Narinder Singh Kapany; he was born on this date in 1926. While growing up in Dehradun in northern India, a teacher informed him that light only traveled in a straight line. He took this as a challenge and made the study of light his life work, initially at Imperial College, London. In January 1954, Nature published his report of successfully transmitting images through fiber bundles– and Dr. Kapany became the father of fiber optics (a name he coined). Dr. Kapany ultimately migrated to the U.S., where he continued to invent (he holds over 100 patents), taught, started successful companies, and became a philanthropist. Fortune named him one of seven ‘Unsung Heroes’ in their “Businessmen of the Century” issue (November 22, 1999). It was, of course, the implementation of Dr. Kapany’s work that rendered “phreaking” moot.
Independent Studio Services, or ISS as it’s known in Hollywood, is one of the leading prop houses serving the motion picture and film community. Producers rely on it to fit sets with every manor of physical item, each authentically evocative of the scene being shot. Most of those items– from sideboards to side arms– are “commercially-anonymous”… that’s to say, not overtly branded. But increasingly over the last several years, via product placement, branded goods– the Heineken that James Bond drinks in Skyfall, the Coke cups in front of each American Idol judge– are slipping into the spotlight.
Still, there are lots of situations in which producers need a “branded” item that isn’t real:
“We’re trained to see brands, so when you don’t it’s almost jarring,” says Michael Bertolina of ISS. “But the network won’t use a brand if it interferes with an advertising deal they have or if it’s not used for its intended use. So instead of covering it with tape or running into a legal nightmare, we create these brands that are fictional.”
Given the normalcy of brands, prop houses like ISS base their fake products on them. Bertolina says the prop version gets modified to the point where it won’t impede on anyone’s intellectual property, “just like private label cereal boxes versus something from Kellogg’s.” So Leonard on Community reviews “Let’s” instead of Lay’s, or Ben Harmon drinks “Haberkern” on American Horror Story last season instead of Heineken.
“Our owner’s name is Gregg Bilson, so you’ll find Bilson cigarettes all over TV,” Bertolina adds. “If you watched Justified on FX, [Mags Bennett] ran a shop and had a rack of cigarettes behind her head all the time. They’re all Bilson.”
More on brands-that-aren’t at CoCreate.
* “I don’t think I am an actress. I think I’ve created a brand and a business.” – Pamela Anderson
As we switch to generics, we might recall that it was on this date in 1969 that ARPANET, the forerunner of the internet as we know it, became an actual network. Initial test login characters had been sent on October 29 of that year from a ULCA computer to a computer at SRI in Menlo Park, CA, which were then permanently connected on November 21 through early routers (small packet-switching computers then called Interface Message Processors). With the addition of nodes U.C. Santa Barbara, and the University of Utah on this date, the “remote binary” configuration became a true network. By December 1971 ARPANET linked 23 host computers to each other; today there are over 900 million host computers connected to the internet– and over 2.4 Billion internet users worldwide.
The inimitable Robert Crumb predicted the world of Twitter, social media, and the always-on internet over 40 years ago in Zap Comix…
As we try on our Google Glasses, we might spare a (humble) thought for Alfred Adler; he died on this date in 1937. An Austrian doctor and psychotherapist, Adler was an early collaborator with Freud in founding the psychoanalytic movement; after parting ways with The Master, he founded the school of individual psychology. Indeed, we have Adler to thank for the “inferiority complex.”
click here for larger, interactive version
In commemoration of Chrome’s birthday, Google enlisted Hyperakt and Vizzuality to create a celebratory chart of the evolution of the internet… The interactive timeline has bunch of nifty features– your correspondent’s fave: clicking a browser icon allows users to see how the browser’s window has changed in each release… a stroll down “memory lay-out,” if not memory lane– and a concrete reminder of the importance of design.
[TotH to the ever-remarkable Flowing Data]
As we resolve yet again to clean out our bookmark cache, we might wish an acerbic Happy Birthday to journalist, essayist, magazine editor, satirist, and critic Henry Louis “H. L.” Mencken; he was born on this date in 1880. Mencken is the auuthor of the philological work The American Language, and is remembered for his journalism (e.g., his coverage of the Scopes Trial) and for his cultural criticism (and editorship of American Mercury– published by Alfred Knopf, also born on this date, but 12 years after Mencken ) in which he championed such writers as D.H. Lawrence, Ford Madox Ford, and Sherwood Anderson. But “H.L.” is probably most famous for the profusion of pointed one-liners and adages that leavened his work…
The difference between a moral man and a man of honor is that the latter regrets a discreditable act, even when it has worked and he has not been caught.
Civilization, in fact, grows more and more maudlin and hysterical; especially under democracy it tends to degenerate into a mere combat of crazes; the whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by an endless series of hobgoblins, most of them imaginary.
I believe in only one thing and that thing is human liberty. If ever a man is to achieve anything like dignity, it can happen only if superior men are given absolute freedom to think what they want to think and say what they want to say. I am against any man and any organization which seeks to limit or deny that freedom. . . [and] the superior man can be sure of freedom only if it is given to all men.
Democracy is the theory that the common people know what they want, and deserve to get it good and hard.
Truth would quickly cease to be stranger than fiction, once we got as used to it.
H.L. Mencken, photograph by Carl Van Vechten (source)