Tag: competition

Does the killer instinct make or break innovation?
By Ryan Long

Does the killer instinct make or break innovation?

Male dominated chimp groups are more violent than their female dominated counterparts, reports Dr. Robert M. Sapolsky, in Our Ancestors Murdered–And Played Pacifist. Does that also mean that the male group was more innovative or entrepreneurial?

After all, among humans, women are almost 60 percent less likely be entrepreneurs than men, according to Why Are There So Few Female Entrepreneurs? Perhaps males are encouraged to channel destructive energy into innovative behavior. Patrick Batemen, the murderous investment banker from American Psycho played by Christian Bale, wasn’t innovative — he sat around in his office all day listening to music — because he was busy killing the competition. Richard Branson was a horrible and rebellious high school student — but then channeled that destructive behavior to create Virgin Records.

This begs the question of whether such destructive male behavior is nurtured in patriarchal societies, and whether the behavior causes — or is merely correlated with — entrepreneurship. Our Ancestors Murdered says we share 99% of our DNA with chimps and that of 152 killings among non-bonobos, males made up 92% of the killers. Whereas, among the socially inclined, female dominated, bonobos chimps, there was only one killing in 92 years. Not surprisingly, the U.S. Department of Justice reports that males — not females — accounted for almost 89% of murders between 1980-2008 in the United States.

Regardless of the relationship between destructive male propensities and innovation or entrepreneurship, competition need not be ruinous, although that seems to be the popular view of it. In American Psycho, Bateman killed one of his fellow bankers because he had a better business card. In patent litigation suits, especially in the patent troll ones, the winner takes all while the loser, often times a nascent start-up, is enjoined from using – or improving upon — the technology. Such zero sum game battles can stop new innovations from coming to market and shifting the supply curve.

Thankfully, collaborative competition is gaining popularity. In the open source community, software developers from around the world contribute code to platforms that build better software, all the while competing against for one another for the glory of making the better contribution. The same was seen among the skaters in Dogtown and Z-Boys, where new tricks were contributed by ambitious young skaters, only for them to be built upon by the new generation of younger tricksters. Building, copying, and improving upon old creations is part of the process, but a zero-sum view, such as that taken by many in the RIAA of copyright vs. fair use, doesn’t encourage such laddering.

While the same competitive tools that play a part in violent or rebellious male behavior also have a part in creating great innovations, competition, in the end, need not be destructive.

Naked economic protectionism — constitutional?
By Ryan Long

Naked economic protectionism — constitutional?

Many of us like certainty. Death and taxes are two things we can be certain about. But should our choice of who we buy our casket from, if we buy one, when we die be dictated by the state? No, says the New Orleans based Fifth Circuit Court of Appeals in its March, 20, 2013 decision in St. Joseph Abbey v. Paul Wes Castille, et. al. This is a good thing. It means the state cannot protect an industry from competition without justification. What implications, if any, the decision on has on similar federal laws remains to be seen.

A group of Louisiana priests brought suit against members of the Louisiana State Board of Embalmers and Funeral Directors because of a law that prohibited the priests from making, and selling, caskets. According to the law, the priests needed to be funeral directors to do that. But becoming a licensed funeral director in Louisiana is expensive and time consuming. The priests claimed that the law violated the equal protection clause because it had no rational basis to a legitimate government interest, and that it was an unconstitutional taking of property without due process.

The Fifth Circuit agreed. Louisiana, after all, allows anyone to build their own casket for personal use, and doesn’t even require a citizen to be buried in a casket at all. The state also allows its citizens to buy caskets out of state. In any event, the Court reasoned, the requirements to become a funeral director have nothing to do with casket making. Thus, there was no rational relationship between the law and a legitimate government interest.

The most important part of the Court’s ruling is its rejection of naked economic protectionism. Under this view, the state has a legitimate government interest in the protection of a particular industry from competition even when there is no corresponding benefit to the public interest or general welfare. The Court said Louisiana could not protect funeral directors from competition by the priests merely because, say, they have a stronger lobby in Baton Rouge.

It remains to be seen whether the case goes to the Supreme Court. If it does and is affirmed, some federal laws and regulations may be in greater danger of being invalidated as naked wealth transfers to a special interest with strong ties in Washington D.C.