Economics

Standard real-options theory makes a clear prediction: when technology advances rapidly, costs fall steeply, and technical approaches remain uncertain, firms should wait. The option value of deferring irreversible investments dominates the value of moving early. We observe this pattern across industries with rapid obsolescence—semiconductor firms stage their fab investments,

The case for free trade is based on the principle of comparative advantage. For example, Indians “pay” for Snapchat (and, let’s say, allow it to repatriate the profits) because Americans are better at building it, and Indians are better at producing something else. The example doesn’t land. India

When hiring for technical positions, people often use high-precision heuristics conditional on relevance to decide who to interview. Otherwise, the interviewing burden would be too much. The advent of GPT makes use of high-precision heuristics, yet more important as interviewing and resumes are less trustworthy now. The heuristics people often

Equity is an integral part of start-up compensation. However, employees and employers may disagree about the value of equity. Employers, for instance, may value equity higher than potential employees because they have access to better data or simply because they are more optimistic. One consequence of the disagreement between potential

Booking travel online feels like shopping in an Indian bazaar: a deluge of options, no credible information, aggressive hawkers (“recommendations” and “targeted ads”), and hours of frantic search that end with purchasing something more out of exhaustion than conviction. Online travel booking is not unique in offering this miserable experience.