Tyler Cowen: belief

Transcript context

…There’s a lot of relationship between the experimental method and the things that are needed to help found organizations. I think that’s something that, historically in economics, many of us have seen research as something that’s divorced from doing things in the real world and, in some cases, even antithetical to it. I think that’s really different in many other fields. Nobody thinks it’s strange that people who are in computer science go on to found firms, or that people who are researchers in biology go on sometimes to found firms. Obviously, there are plenty of people in computer science or in biology who aren’t interested in that, but people don’t think it’s strange that there’s some people in those fields who do. We’re now getting to a time in economics where I don’t think I’m unique in this. Many economics researchers — researchers in development economics, in particular — have gone on to found organizations, and those have had real impact. I don’t think this is exclusively tied to development economics since the experimental method, but I could explain a little bit more about why I think the experimental method and contemporary development economics research does have a natural affinity for that. But that I get. Why do you have a natural affinity? If I think about your O-ring model — as you know, that predicts the less productive people in an organization, in a way, drag down the productivity of the more productive people. Now, you’re one of the most productive people. You might think, according to O-ring theory, maybe you should found with Abhijit and Esther, but not with anyone else. There’s not a certain comparative advantage in that model. How do you think about the economics of you as founder? How should I model that? I’ll just give an example. The most recent thing that I’ve been involved in cofounding was an organization called Precision Agriculture for Development. What that organization does is, it works on mobile phone–based agricultural extension. At least that’s where it started. It’s now broadening out. That’s something that requires we use tools from experimental economics. We do A/B tests. We use ideas from behavioral economics. So it’s using a lot of tools from economics, but it also takes a bunch of many other skills to found things and to operate an organization. I don’t think it’s a matter of those other people being less skilled. It’s a matter of people being skilled in different areas.…

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