Tyler Cowen: belief

Transcript context

…I would agree. EV India is a lot of fun. For those of you who are investing or thinking of investing in India, there are a lot of low-hanging fruit. A lot of the people that we pick for EV India — if they were in the United States or Canada, they would have been in incubator programs and accelerator programs and magnet schools and Thiel Fellowship or something like that, but none of that exists in India. The scouting or the incubation infrastructure doesn’t exist. Actually, Tyler and I are in competition usually, and I get far better quality of applications, a higher average and lower variance than the ones that Tyler gets from the rest of the world. That’s my simple explanation for what’s happening in India. One of the things that both start-ups and economics departments have in common is failure. This is both at the level of . . . Start-ups, it’s fairly obvious. But in economics, most people who start their PhDs don’t finish, or even the people — the sorts that Tyler is hiring as professors in the econ department — they may stop publishing, or they may give up at some point. What is a good way to screen for who will handle failure well, or at least better than the others in the running? I think in science, we’ve allowed institutions to evolve to the point where people have options of not failing at all. Science ought to be more like start-ups. Most ideas do fail, even published research papers in top journals. If you ask researchers who really know, and they’re willing to speak honestly with you, like, “What’s the chance that paper is actually true?” you’ll get answers like 20 percent, 30 percent. You don’t get answers of 50 percent, but we’ve created this veneer or cloak of, “If you do all the right things in terms of process, we’ll all pretend to take this paper seriously.” You’ll get tenure somewhere — maybe not at Harvard or MIT, but at some tier-one research university, and you’ll be given all these bureaucratic duties, and you have to referee a lot of papers and hire other people. It’s this self-replicating thing that insulates people from truly failing, but it also means that fewer people than ever before pursue true success. I think it’s an example of gross talent misallocation. It is a better lifestyle. If you become an academic and if you work hard enough and you’re smart enough, you can’t fail. But we’re doing ourselves a gross disservice. I think a lot of our sciences are badly out of whack for this reason, and they should become more like start-ups again. But structures tend to ossify, and academia certainly is no exception to that. Yes. Look, there are classical answers to your question of, how do you look for stories early on in someone’s life — failure and whatnot. All that stuff is true. I think a great emotion to be on the lookout for in an interview, in particular when assessing founders, is fear. Sometimes you meet people and their naked ambition is so large and vast that I don’t feel fear for my life, but I definitely feel a little bit of fear being in the room with them. I think that’s a very promising sign when one feels that emotion, and that, I think, is a good proxy toward, will the person handle failure? I think a lot of the best founders I’ve had the pleasure of working with don’t even really experience setbacks and failure the same way most people do. Or the degree of badness of the news — for something to register in their minds as true failure is much higher than it is for most people. A lot of bad news is immediately misinterpreted as great news. “Oh, the market’s down? Great. A lot of talent will be fired, and we’ll be able to hire them.” Correction, creative destruction and whatnot. I think a lot of that comes out of just a general sense of vigorousness and vitality that I think is somewhat correlated with this sense of ambition, too. I think about that a lot. Reflexively, I try to think about how I feel when I interview someone. I imagine, actually, everyone’s doing that. Some awareness to the process is quite helpful, though.…

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