Yelp’s Heyday Is Over


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Will Zomato face a similar struggle in India?

Part of Yelp’s woes seems related to its new no-term deals, meaning advertising clients are not locked into a contract. While that move initially resulted in a jump in new accounts, it also means businesses aren’t obligated to continue to advertise if they’re not impressed with the results of their advertising — and seemingly, more and more business owners are taking their ad dollars elsewhere, especially as diners flock to other platforms. “I opened a new restaurant a few months ago, and for every five Google reviews we get, we get maybe one Yelp review,” says Danny Teran, co-founder of the NYC-based Watson Hospitality Group. “Three or four years ago, that wasn’t the case.”

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Whitney Filloon — Eater

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Money: 5,000 Years of Debt and Power


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The first lie is that if finance is entirely free, globalised and unregulated, it will develop instruments to insure against risks (derivative products), rendering impossible the spread and intensification of the blaze. After two decades of stable inflation and financial liberalisation, the financial community, the media, and the political establishment loved to proclaim that systemic crisis had now become impossible (‘this time it’s different’). But the impossible did happen. This owed not to some external mega-event but rather to the fact that speculation had eroded from within any sense of reason and any barrier to the appeal of greed. This first lie is also the basis for the other two.

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Michel Aglietta — Verso

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The god of China’s big data era


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Are we heading towards a nightmarish world where our every action is going to be rewarded or punished by the Government?

An Orwellian characterisation of social credit is the favoured narrative of English-language media and academia. Countless media stories compare the system with Nineteen Eighty-Four or other more contemporary cultural references such as the Netflix series Black Mirror. The underlying depiction of social credit in these instances is of ‘big data meets big brother’: a corporatist state spying on its population, hoarding vast swathes of personal data to be algorithmically synthesised into a single three-digit score that dictates one’s place in society. Punishments such as bans on individuals purchasing tickets for air travel have hit the headlines.

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Adam Knight — ECFR

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The Peter Principle is a joke taken seriously. Is it true?


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The Peter principle states that “every employee tends to rise to his level of incompetence”. If someone is good at her job, she’ll be promoted into a job that demands different skills. If she’s good at the new job too, she’ll be promoted again, requiring yet another set of skills. One day, she will arrive at a job for which she is wholly unsuited, and there she will stick. Since when did a manager ever get sacked for anything?

The Peter Principle is satire: it mocks management and it mocks books about management. It is striking, then, that most people take it quite seriously. The Harvard Business Review has published numerous straight-faced responses.

Two questions, then: is the Peter principle true? If so, what can we do about it?

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Tim Harford

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The Constant Consumer


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We have become an active consumer all through the day thanks to technology.

In light of Amazon’s all-encompassing ambitions, the strategy behind several of the company’s most important product initiatives — Alexa, Amazon Prime, physical retail stores (including Amazon Go and Whole Foods), and Amazon Key — becomes clearer. These products seek to redefine what being a customer means by immersing us more completely within the Amazon universe. Formerly, being a customer was a role one assumed upon physically entering a store or ordering something from a company. Amazon promises to create a newer type of environment, a hybrid of the digital and the physical, that lets us permanently inhabit that role: the world as Everything Store, which we’re always inside.

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Drew Austin — Real Life

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The Bear Stearns Bailout, Ten Years Later


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Most of us remember the pains and uncertainty around that time. But, have we learnt the lessons?

During former Federal Reserve Chairman Paul Volcker’s famous remarks to members of the Economic Club of New York after details about Bear Stearns’ rescue by JP Morgan Chase and the Fed came out ten years ago, he pointedly observed that such actions carried an “implied promise of similar action in times of future turmoil.” The Fed’s intervention is commonly remembered as the start of a cycle of institutional collapse and government bailouts that defined the 2008 financial crisis. Volcker went on to observe that such crises have in fact been a “recurrent feature of free and open capital markets” and that “any return to heavily regulated, bank-dominated, nationally insulated markets is pure nostalgia.”

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Luzi Hail, Ahmed Tahoun, Clare WangInstitute for New Economic Thinking

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After Recessions, Why Do Some Jobs Disappear Forever?


Knowledge@Wharton: There are two things that I found quite interesting in your paper that I want to highlight for a minute. One is the finding that 88% of job losses in the so-called “routine” occupations — such as bank tellers, manufacturing plant jobs, and office clerks — happened during economic downturns, and this is a trend that has been going on since the mid-1980s. Interestingly, this was also around the same time when innovation and automation started to pick up. These two seem to be correlated. Are they?

Roussanov: This is exactly the main empirical fact that our model aims to explain or at least understand. We were not the ones who documented this fact, but this has become an important piece of information for macroeconomists to wrap our heads around — the fact that this job polarization process seems to be primarily happening during relatively short periods of time, which are recessions.

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Knowledge@Wharton