Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

Hot take on economics 

@freakazoid So, #GreshamsLaw dynamics can turn up in various forms. I've tried (unsuccessfully) to catalogue the in the past.

There's fiat or imposed value, as with coin. Also with transjurisdictional standards, such as divorce law and shipping registries ("flags of convenience"). Whatever the *minimum* acceptable *somewhere* is, is acceptable *everywhere*.

There's effective perceived value -- Mencken's "Brayard", or consumer technologies, or bicycles.

@o @woozle

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@freakazoid Underlying quality is difficult to communicate, so some *quality indicator* is substituted. Accent. Vocabulary. Cultural myths. Clothing. Food. Table manners. Branding. Musical tastes. Books read. Schools attended. Management fads.

These signal *both* quality *and* group alignment -- and the wrong set can easily get you killed in many cases.

*Changing* signifiers is highly traumatic: culture wars and value shifts.

This also leads to cargo culting.

@o @woozle

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@dredmorbius @woozle @o These fall into a few different possibly overlapping categories: implicit bias, laziness or ignorance (because the information is available but people don't bother to look or don't know it's there), and places where it's genuinely hard to know, like interviewing and managing (though there's a lot we do know about management and interviewing so laziness and ignorance applies there).

...

@o @woozle @dredmorbius Volume also contributes to this a lot: for cheap things, the cost of research can be a significant fraction of the cost of actually buying it. This is probably why for many things there's not much of a "middle ground", just super cheap and super expensive things.

You can also get seemingly paradoxical effects where the brand with the better reputation has lower quality at a higher price point. I've noticed in general an inverse correlation between marketing and quality.

@freakazoid @dredmorbius @woozle @o

Mature markets tend to end up with two market leaders and a bunch of also-rans. In that kind of market, the #1 is often complacent and of poor quality, but the #2 tends to be better because it wants to knock the leader off the top spot.

e.g. VHS vs Betamax, Windows vs macOS, VW vs Toyota for cars, etc.

(Obviously there are counterexamples, and I think the trend is becoming less clear as markets fragment.)

@mathew @o @woozle @dredmorbius Two of the three examples you cite have strong network effects, where that's certainly true. But car manufacturers don't have this problem. Globally, in 2014 (the year I can easily find data for), the number 8 automaker by number of cars (Honda) sold almost 43% of the number of cars of the number one (Toyota). In the US, the number 7 manufacturer, Kia, sold 43% as many passenger cars as the top manufacturer, GM. And number 3, Toyota, has almost 83% of GM's sales.

@freakazoid @dredmorbius @woozle @o Cars may not be a two-player market, but I still maintain that VW has gotten lazy (and indeed downright criminal), lets its quality slip and failed to invest in new tech, while Toyota has focused on making better cars, even if they did make a disastrously bad move betting on hydrogen rather than battery storage. (There's probably an interesting case study there on why they went the way they did.)

@mathew @o @woozle @dredmorbius No case study needed: they did it because hydrogen is heavily subsidized in Japan.

VW's failure to invest in new tech is the case with car makers across the board. Their cheating was to try to avoid losing a bunch of car sales as diesel was essentially getting regulated out of business. Which IMO was a stupid move on the government's part since diesel has lower CO2 emissions than gasoline.

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@dredmorbius @woozle @o @mathew Actually I should qualify that - it has lower emission not because its specific CO2 is lower but because diesel engines have higher compression ratios so tend to be more efficient. You can also get more of it from oil without having to resort to cracking. But hybrids are better, so probably not stupid to regulate its emissions, really.

@freakazoid @mathew @o @woozle @dredmorbius You can also decouple compression ratio (which actually increases thermal losses the higher you go) from expansion ratio (what actually improves efficiency) through either crankshaft linkages (true Atkinson-cycle engines) or valve timing ("Atkinson"/Miller-cycle engines with late intake valve closing or an extra valve, Budack-cycle engines with early intake valve closing).

And the compression losses actually mean that, in an engine that has a full compression stroke, optimum compression ratio is about 16:1 - anything more than that, and you start losing more to heat than you get back in expansion, as I understand. (Diesels ran significantly more than that in the past because they needed the excess heat to reliably ignite fuel, but in the 2010s they got down to 16.5:1 for most engines.) There's gasoline engines that run 13:1 on American regular fuel in full Otto cycle operation, though, and 14:1 on American premium/European regular.
@freakazoid @dredmorbius @mathew @o @woozle And, yeah, as much as TDIClubbers like to go on about "but diesels beat their EPA mileage and hybrids don't!"... they only do that if they're cheating and/or you're driving slower on the freeway than the current EPA freeway cycle. And hybrids can beat it too if driven like that.

My pre-Dieselgate 1999 New Golf TDI (which was fairly heavily modified, but one of those mods cheated constantly, improving thermal efficiency) pretty reliably got 47-51 miles per US gallon on the highway - original EPA highway was 49, 2007 re-rated EPA highway is 44.

By comparison, on road trips, my 2016 Prius gets about 54 MPG, versus a rating of 50 highway. And, that's on a lower carbon per gallon fuel. (Better aero does help.)

And then, in the city it does decently, I typically get 40-60 on my commute (if it's spring/fall, 60, summer, 50-55, winter, 40). The TDI would be more like 30-35 MPG on that commute.

@freakazoid Deisel fuel itself has a slightly higher energy content than petrol/gasoline, the engines run at higher compression ratios, and at higher temperatures (Carnot efficiency), all of which net more mileage and lower CO2 emissions.

Emissions of *particulates* (especially PM2.5, v. bad for lungs and health), and of NOx (nitrogen oxidising at high temps and pressures) are *worse* for deisel than petrol engines.

Also possibly sulfer and other sour crude contaminants.

@mathew @o @woozle

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