April 26, 2004

Carnival of the Capitalists!

Welcome to the Carnival of the Capitalists! I am thrilled to be hosting this week and invite you to take a look around Venturpreneur as long as you are here. (Apologies to Netscape users, as I am still trying to fix a testy stylesheet problem.) As usual, the Carnival has attracted a wide variety of interesting entries, which I catalog below (with the usual editorial comments).

Host's Choice for Post of the Week

It has become fashionable for Carnival hosts to choose their favorite posts of the week. Mine comes from Simon World, who addresses the unsustainable growth of the Chinese economy, a topic of great interest to me, since I am headed for China next month. The root problem: "China does not allocate its capital efficiently."

Government & Business

The Interested Participant has another interesting take, this time on the hiring policy at Dayton Power and Light Co. (DPL). Although the policy had been in effect for years without much notice, IP suggests that DPL got on the Labor Department's list for a "soup-to-nuts administrative colonoscopy." To see what happens next, you'll have to read the rest yourself.

"Aunty Goob" at goobage relies on Thomas Sowell to shed light on the recent kerfuffle over CalPERS' attempts at corporate governance reform (and other government-business interactions) in a post entitled "Gummint Good, Bidness Bad."

I hadn't planned to make an entry in this weekās Carnival, but my report on the nomination of Myron Steele as the new Chief Justice of the Delaware Supreme Court might be of interest to some here. You donāt have to be a lawyer to appreciate the importance of Delaware corporate law, and (Chief) Justice Steele will inevitably be a central figure for years to come.


Tennessee blogger Les Jones offers "Tuesday E-Commerce Report #8," which includes a discussion of a new technology for credit card authentication, and asks the question we have all been too scared to ask: can you sell carpet on the Web?

Frank Scavo at The Enterprise System Spectator describes and comments on an article from the Harvard Business Review, which discusses IT decisions that the IT people in your firm should not be allowed to make. The money quotation: "senior management must collaborate with IT in setting IT strategy; and they must also learn to deal with IT at the level of execution."

Photon Courier is writing about the state of hospital automation, which is behind where is should be if patient care were our only concern. PC muses about the possible causes of the reluctance to embrace new technologies, including physician acceptance, money, and reliability. As luck would have it, I just heard an excellent discussion of this issue last week by Mark Suchman of the University of Wisconsin Sociology Department. Mark has been studying this issue for several years and is particularly interested in how technology changes the control structure of health care. This promises to be a big issue for years to come.


Arnold Kling provides his usual thought-provoking post on the "Drug Tax," inspired by an Instapundit post and a talk by USC Law Professor Charles Whitebread. The money sentences: "In his blog post, Reynolds discusses the point that if drug prohibition were ended, then this would call into question the requirement for prescriptions for medication. I think that economists would support getting rid of that requirement, although huge opposition would result from rent-seeking physicians and pharmacists."

Micha Ghertner at the group blog Catallarchy applies a tip learned from an economics professor -- "when in doubt, the answer is opportunity costs" -- to law enforcement and the illegal drug trade.


The Big Picture describes the implosion of the music industry. The culprit: overpricing relative to other entertainment options, most importantly, video. Add to that inferior sound from an "outmoded format," and you have a recipe for decline.

Matt Stichnoth is blogging at about the obsession of American managers with quarterly earnings. While he thought this attitude might abate somewhat in the way of Enron, Tyco, Freddie Mac, etc., it hasn't. The problem is that managers who focus on the short-term attract investors who are focused on the short-term, a reinforcement that makes change difficult.

Craig Henry at Lead and Gold compares the Marine Corps' approach to instilling a common doctrine among the troops and corporate attempts to regulate employees through "fad surfing." As you might imagine, corporations come off badly.

Anita Campbell at Small Business Trends uses an article from The Times to ponder the "hollow corporation." Anita rightly notes that this concept is not new in the U.S., where we have been talking about "virtual corporations" for at least a decade. Unfortunately, this concept took a hit with a little company called Enron. You can also catch Anita over at The RFID Weblog writing about farmers and Palm Pilots (do we still call those things Palm Pilots?).

Fouroboros is ready to do a Fahrenheit 451 on his collection of business books: "Good to Great is The Fifth Discipline is The Lunar Men. They say the same things in different words. We nod at the answers when we read them. But not because we've had an epiphany, but because we recognize a pattern, a thread, a sensibility already parked in our heart and our head. We recognize, we aren't discovering. We already had it. It was right under our nose. It wasn't 'new.' Silly, isn't it? Go on. Go 'burn' a book."

Steve at Deinonychus antirrhopus takes on the issue of health insurance for the Wal-Mart employee who has HIV: "I think it is rather foolish to expect behavior from a firm that is antithetical to the purpose of a firm. Firms maximize profits. As such it is silly to expect a firm to be run as a charitable organization. We don't expect firms to set their prices to zero, and we shouldn't expect them to give away their profits either." For a (much longer) follow-up post, see here.


Jeff Cornwall at The Entrepreneurial Mind discusses "The Changing Face of Equity Investors." He describes two types of angel investors -- organized and informal -- and cautions entrepreneurs to understand the difference. If this topic interests you, check out the New York Times story described in my short report on Googleās investors.


Timothy Grayson at Recursive Progress rants against marketing executives who are trying to reverse the waning effectiveness of advertising "the bottom line is MORE advertising volume less advertising effect. It's simple physics."

Abnu at Wordlab wonders whether Campbell Soup's new can labels might be Andy Warhol's next 15 minutes of fame.

Wayne Hurlbert at Blog Business World offers a useful primer on that perpetual hot topic for bloggers: search engine optimization. If you have wondered how to get more Google traffic (haven't we all?), but haven't done anything about it, this would be a good place to start.

Something Completely Different

Rich at Sharp Blue offers a post on the economics of interface transportation.

Thanks to all for playing. Next week's Carnival will be hosted by Brian Brew Radio. See you there!

Posted by Gordon at April 26, 2004 12:01 AM | TrackBack

Thanks for the honour and congrats on the hosting. Good job (not that I'm biased) ;-)

Posted by: Simon at April 26, 2004 02:58 AM

Nice hosting job -- very readable and nice choice of content. Thx for the link, BTW.

Posted by: Grayson at April 26, 2004 07:01 AM
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