Arnold Kling  

A Sentence to Ponder

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from Felix Salmon:


I see [Tyler] Cowen as being a kind of anti-Larry Summers in the internal government debate about what to do about Haiti. Rather than being the person who throws cold water on promising ideas, he's the person who holds them up with enthusiasm, finding people who can navigate and solve any flaws in the initial concept.

In FP2P, we have a discussion of the entrepreneurial personality vs. the bureacratic personality. The entrepreneur wants to test ideas empirically. The bureaucrat wants to say "no" a priori. Large organizations need bureaucrats, because otherwise they would waste too much organizational capital (human as well as financial) trying out bad ideas. Entrepreneurs start with less organizational capital to lose, so they are the ones that you want to try out risky ideas.

Only in desperate situations will organizations turn to entrepreneurs (I am thinking of wars, when the military will dismiss some of its bureaucratic leaders and elevate some entrepreneurial ones.) Haiti looks like a desperate situation.


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CATEGORIES: Business Economics



COMMENTS (3 to date)
Jim Manzi writes:

Arnold:

I agree with the comment about the entrepreneurial personality type. I'd characterize the typical bureaucratic personality as avoiding embarrassment. This more often than not translates into 'VP of No', but not in all situations.

FWIW,
Jim Manzi

david writes:

At least some large organizations find ways to suppress the tendency towards bureaucratic leadership - Google has "20% time", for instance. Ideas there rise to the top via a systematic process (Google Labs); unsuccessful ideas get quietly disposed of every now and then.

On the other hand, many large organizations are insufficiently bureaucratic and procedure-driven. Research in hospitals suggests that many human errors can be reduced by simply enforcing checklists. So there may be benefits in either direction.

Hmm. Both of these seem more controllable by organizational practices rather than the size of an organization per se.

Nobody Special writes:
The bureaucrat wants to say "no" a priori. Large organizations need bureaucrats, because otherwise they would waste too much organizational capital (human as well as financial) trying out bad ideas.

Completely false. It doesn't matter if the idea is good or bad. Any idea that will permanently increase the size of a government bureau's budget and the scope of its responsibilities is a "yes" a priori.

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