A Matter of Taste Summary

A Matter of Taste SummaryHow Names, Fashions, and Culture Change

It’s quite paradoxical, when you think about it!

In a world which has acknowledged Frank Sinatra’s “My Way” as its unofficial anthem, it’s getting harder to be unique! Fashion styles seem to come and go incessantly: blink, and you’ll miss the last one.

A Matter of Taste” teaches you a thing or two about the reasons which make some things fashionable and render others outdated.

And we’ll summarize the key points here.

Who Should Read “A Matter of Taste”? And Why?

“A Matter of Taste” is not exactly your typical book about fashion. After all, its author, by the looks of his portfolio, seems much more likely to watch NatGeo over FashionTV any day of the year.

With that being said, “A Matter of Taste” may be still interesting to fad followers and fashion designers. The reason? It tries to uncover the secret ways, “the pure mechanisms” by which fashion operates. To do this, the book studies carefully how first name popularities change over time and why.

Consequently, even if you are simply in the process of choosing your child’s name, you might get an interesting insight from Lieberson’s research.

About Stanley Lieberson

Stanley LiebersonStanley Lieberson is a Montreal-born sociologist whose focus is mostly the American society. He obtained his M.A. and Ph.D. in Sociology from the University of Chicago and currently works as Research Professor at Harvard.

He has written books on numerous subjects, the most important among them “A Piece of the Pie,” and “From Many Strands.” Lieberson is one of the most eminent currently active sociologists.

“A Matter of Taste Summary”

De gustibus non disputandum est.

These are probably the only few words in Latin you remember. Their meaning? You know that full well too: “In matter of taste, there can be no disputes.”

Lieberson says: “Oh, really?”

And that’s how the dispute commences.

To begin with, it seems that it’s hard to define taste and fashion. We know the two are related, but it’s hard to really pinpoint how. What is that which dictates fashion? And how something becomes fashionable? Finally, why is it that sometimes having a taste means going against the grain?

Lieberson doesn’t really study fashion per se. Clothing, makeup, hairstyle, etc. are merely afterthoughts here. His interest lies somewhere else entirely. Namely, in the changing fashions of first names. By studying them, he thinks, he can learn more about fashion in general.

Why?

Well, firstly, because, unlike other fashion practices which are less tangible and measurable, first names are always carefully recorded. Data about them is readily available at all times. And secondly, because first names are rarely influenced by economic factors.

After all, who would benefit from launching a campaign to name your son Charlie? And is anyone restricted by his class or upbringing when choosing a name?

Consequently, Lieberson may have a point! Studying the changing fashions of first names is a good way to study the “pure mechanisms” of fashion itself.

We can rephrase this even better! We’ll just need few questions.

If you can name your child any way you like, then what makes you choose a certain name? Is it your parents and religion? Or is it the fashion of today? Or, something else entirely?

In general, the exhausting process of choosing the right name for a child is a modern practice.

It was much simpler before the advent of modern societies. A name was all but chosen before the birth of a child, dictated by traditions and religion. That’s why almost every second Roman male in your history books was called Gaius. Possibly Lucius or Marcus.

Now, compare and contrast with a modern fact.

Ready?

In the 1980s in France, almost 3 of the ten most popular girl’s names dropped out of the list on a yearly basis!

Naming became a matter of taste once education became free and ubiquitous. It was only then that religion and traditions made way for individuality and uniqueness.

Even so, it was a practice still affected by many external events!

For example, there are many American Franklins born in the 1930s! Why? Because of the popularity of Franklin Roosevelt after he started tackling the Great Depression. If his name had been Peter, Lieberson says, your grandfather’s name would probably have been Peter. Of course, if his name is Franklin now.

However, external forces shape name fashions only to a certain extent. That’s because they are regulated by some internal mechanisms.

How does that work?

Well, even when disruptive, external events usually can’t change naming practices radically. Unless they are appended to some existing custom and further develop it in the same direction. That’s why it’s hard to think of a newborn girl named Barbra! Streisand is so 1960s!

Barbra itself was a name which caught up because Barbara was there before it. This is another of fashion’s regulating internal mechanisms. It’s called the logic of incremental change. The name Tonya comes to mind when you hear the name Latonya. That’s why Latonya is a possibility. But no name can act as the basis for some future Jabberwockies!

A plant flourishes only on a fertile ground. You must be a real optimist if you expect a banana to grow in Siberia!

In fact, this is why immigrants choose names which will help them better assimilate. Have you thought about that? They can just import their heritage with them, but they don’t.

Of course, internal mechanisms still regulate the process. That’s why Mexican-Americans don’t name their children Joshua. You see, in Spanish, the “a” ending is reserved for girls.

This is also why popular culture only marginally influences naming practices. According to Lieberson, even movie stars rarely disrupt the naming practices. Even in that case, there has to be some precedent for an influence on work.

For example, Marylin gained in popularity after Marylin Monroe. However, Humphrey Bogart did nothing for the popularity of his name despite his stellar status.

The reason?

Humphrey was an unpopular name, to begin with.

Key Lessons from “A Matter of Taste”

1.      Naming Practices Are a Great Way to Study Fashion
2.      External Events Influence Fashion; Internal Mechanisms Regulate It
3.      Even so, Sometimes, an External Event Is Just Too Disruptive

Naming Practices Are a Great Way to Study Fashion

You’d never associate naming practices with catwalks, but Lieberson does! And he proves that by studying what’s fashionable and what’s not in the world of first names, we can discern how fashion evolves.

Names are better than clothes. First of all, because there is much more readily available data about them. Secondly, because the demands of the market do not influenced their changes. Finally, because everyone is free to name his children any way he likes. Regardless of how much money he or she has.

External Events Influence Fashion; Internal Mechanisms Regulate It

Fashion is not immune to external events. As many other things, it’s merely adaptive. And even though, usually, an external event doesn’t disrupt fashion radically, it may influence it in such a manner that it’s both visible and measurable.

Don’t believe us? Then ask yourself: how many black children were named Barack during Obama’s presidency?

However, it’s important to note that not many were afterward. It’s because Barack is an unusual name and because internal mechanisms regulate naming practices. The most important among them: the logic of incremental change.

In laymen’s terms: even though some things may seem alien in the world of fashion, they are almost definitely a product of some evolution. If, however, they really are disruptions – they won’t last.

Believe us.

Even so, Sometimes, an External Event Is Just Too Disruptive

OK, there are some exceptions to this rule. But, they are few and really, really exceptional! Because, of course, very few Germans and almost no French people would name their firstborn son Adolf!

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“A Matter of Taste” Quotes

The social order matters, but more is going on. Click To Tweet People in the United States do very well in guessing the gender of children who are given an invented name. Click To Tweet The influence of collective processes on tastes becomes powerful, and ignorance about choices being made will generate highly volatile shifts. Click To Tweet The analysis of a cultural surface involves the initial occurrence and growth of each element; its continuation in the likely event that the initial causes no longer operate; and the forces that cause other earlier elements to decline or… Click To Tweet

Our Critical Review

Make no mistake: “A Matter of Taste” lives up to its subtitle! It is a fascinating study in how names, fashions, and culture change and what dictates these changes. Its writing, however, is dry and erudite, and it’s not exactly an easy read. And its conclusions, ultimately, are too obvious to begin with.

Read the book if you’re a fan of sociology. Read our summary if you merely want to learn what it is about.

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Why is Sex Fun Summary

Why is Sex Fun SummaryThe Evolution of Human Sexuality

Why Is Sex Fun?” is a book about sex!

That’s it: you’re all hooked up now!

We’re gussing there’s no need for an introductory paragraph.

Who Should Read “Why is Sex Fun”? And Why?

A good way to answer this question is by giving an answer to its opposite: anyone who thinks that the title “Why Is Sex Fun?” isn’t interesting enough shouldn’t leaf through the pages of this book. And, in this summary, we’ll try to make even those five guys out there reconsider.

About Jared Diamond

Jared DiamondJared Mason Diamond is an American polymath (physiologist, geographer, ecologist, biologist, anthropologist) and the author of many popular science books, such as “Collapse,” The World Until Yesterday,“ and the Pulitzer-Prize winning “Guns, Germs, and Steel.”

A professor of geography at UCLA, he was recently ranked as the 9th most influential public intellectual in a joint poll by “Foreign Policy” and “Prospect”. Read more at his personal website: http://www.jareddiamond.org

“Why is Sex Fun Summary”

It’s just like that old Salt-n-Pepa song says:

Let’s talk about sex!

And, boy, there’s so much we need to talk about it! S good place to start is certainly the one you’ve never even thought about a single second of your life. Now – wait a second – how should we phrase it?

Let’s pick up a trick of Jared Diamond’s book and try asking you something from the perspective of your dog. We’ll even try to use its dog language:

“Woof, master, woof! I have a question for you, bow-wow… now, ruff, why are you doing it so weird?”

“Weird?!,” you shriek in disgust, still bamboozled at the fact that your Golden Retriever can talk! “It’s you who’s the weird one, Buddy! You have sex in public with whoever you want!”

Cue the sound of a mic drop. You smirk in victory.

But, let’s get that smile off your face.

In “Why Is Sex Fun?,” Jared Diamond – and he’s the expert about this – says that your dog is, in fact, very right. Not one single animal shares the human sex standards. It’s us who are the weird ones in more than one aspect.

First of all, the human species is the only kind who has sex behind closed doors and with the lights out. Secondly, it is the only species which practices random sex, irrespective of whether the females are fertile or not. Finally, human males are the only animals which can go on having sex with a female even after impregnating her.

The reason?

Look at the title of the book: because sex, for humans, is a fun activity. And because nowadays it has very little to do with what it was originally all about: passing on your selfish genes.

Of course, this tells only a small part of the whole story. After all, it’s evolution! So, even the fun has to be in some way related to reproduction.

And, indeed it is.

You see, even though some say that monogamy is counter-evolutive, we’ve evolved to be monogamous exactly because it was better for our genes. And it all started with ovulation in female humans.

Have you ever wondered why ovulation is hidden from view only in humans? It’s there in plain sight even in our closest relatives. Just look at the baboons!

In fact, almost all animals have sex only when they know that sex may lead to pregnancy. Because of this, there are obvious signals who show when females are fertile in most of them. Somehow, human females evolved to hide this crucial fact from their male partners.

And get this: that’s exactly how monogamy was born!

You see, human males had no way of knowing when it’s the right time to have sex to impregnate females. So, they started having sex with the same female over and over again. And since they were able to have recreational sex, male humans gradually lost the desire to seek other females to copulate!

After all, how would they know if they are fertile? It made no difference to them whether they had sex with the partner beside them or the partner somewhere out there in the wild!

Moreover, you could even argue that staying had a comparative advantage in terms of their genes. Because, human females are physically connected with their children. Males are not: theoretically, they can leave the moment they impregnate a female.

And yet, they don’t! Why is that?

Because, in humans – as in many other animals – males are the more muscular kind. They are the hunters who fight and they are the ones who can protect the females while they are breastfeeding. Leaving a female alone while breastfeeding may spell disaster both for her and your child.

Now, we know you don’t like that much bodybuilders showing off their muscles, but there’s an evolutionary reason why they do this.

And it’s because men with muscles, in the eyes of your ancient female predecessors, were the Batmans to their Gothams. They offered them the best protection from the evil lurking around.

And, to them, that was the equivalent of love.

Key Lessons from “Why is Sex Fun”

1.      Today’s Societies Exist Because of Monogamy
2.      You Live Longer Because of Monogamy… And Menopause
3.      Size Matters… In a Way

Today’s Societies Exist Because of Monogamy

Concealed ovulation was the reason why people became monogamous. Simply put, after invisible ovulation became the fad of the pre-homo sapiens times, the best chance for a human male to impregnate a woman was to have sex with a single member of the group as often as possible for at least few months.

Of course, this led to stronger bonds, which grew even stronger after impregnation, because, unlike other animals, humans are virtually helpless during the first few years of their lives. That’s why monogamous families exist.

And that’s the foundation for a human society.

You Live Longer Because of Monogamy… And Menopause

Both impregnating a woman and pregnancy itself are energy-draining processes. Studies have shown that the less they happen in a male or a female, the longer that male or a female lives.

Mice don’t really have a choice: they spent all of their energy reproducing, because many of their children will. Their best chance at passing on their genes is by having as many children as possible.

In humans, it’s the other way around: the more energy they save from the process of creating a baby, the more energy they have for raising it properly. That’s why human females are the only animals which stop being fertile at a certain age.

They need to live longer and care for their children.

Size Matters… In a Way

Male peacocks have tails; human males have penises. In what way are they similar?

Well, evolutionary biology says that large and flashy tails should be detrimental to a peacocks’ chances for survival. Then, why are they interesting to females? Exactly because of that. The bigger and flashier they are the more they say “hey, look how great I am: despite this disadvantage, I made it this far!”

It’s the same with male penises. The more well-endowed a man is the more capable he is of producing healthy offspring. His words: “I’m so vigorous and fit throughout, that my body can focus so much of my energy on my reproductive organ.”

So, in a way – sorry to disappoint you, guys – for a completely different reason, size does matter.

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“Why is Sex Fun” Quotes

Our standards of sexual conduct are especially warped, species-ist, and human-centric because human sexuality is so abnormal by the standards of the world's thirty million other animal species. Click To Tweet Perhaps our greatest distinction as a species is our capacity, unique among animals, to make counter-evolutionary choices. Click To Tweet Sex is costly in energy, time, and risk of injury or death Click To Tweet By the criterion of services offered to mates and children, males of most mammal species are good for nothing except injecting sperm. Click To Tweet We quickly sense who attracts us physically and who doesn't. That quick sense is based on ‘sex appeal’, which just means the sum of the body signals to which we respond, largely unconsciously. Click To Tweet

Our Critical Review

“Why Is Sex Fun?” is part of “The Science Masters Series” – a fact which says many things about it. Number one: it’s written by a leading scientist. Number two: it’s written for the general audience. And number three: there’s not one single alternative fact inside.

“Why Is Sex Fun?” goes many steps further: it’s interesting, enjoyable, and enlightening. In fact, it has only one drawback: it’s short. We, for one, could have read Diamond talking about sex for at least couple hundred pages more.

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Brain-Wise Summary

Brain-Wise SummaryStudies in Neurophilosophy 

Time allocated to philosophical controversies without reaching a state of facts meets several mind-blowing aspects:

The understanding of God, The power of free will, and how would you describe yourself – as what?

Who Should Read “Brain-Wise”? And Why?

Whatever you take for real, another person can interpret it differently from another point of view. It is an infrastructure created by your imaginary force which contradicts the series of neural interactions. You may have heard this term before, Darwin and its theory are a perfect example of such a vision.

To understand the Neurophilosophy concept, we adopt Churchland’s approach by promoting this excessive and valuable methodology. As such, “Brain-Wise” comes highly recommended for all people keen to move beyond the daily concerns and challenge themselves on another level.

About Patricia Smith Churchland

Patricia Smith ChurchlandPatricia Smith Churchland is an expert in ancient philosophy and heads the philosophy department at the University of California. Despite her contribution to the merging process she also tries to educate other individuals on subjects related to Neurophilosophy at the Salk Institute.

As a writer, she wrote Neurophilosophy and co-authored On the Contrary.

“Brain-Wise Summary”

The brain is a complex entity capable of achieving almost anything, yet restricted in so many ways. By all means, underachievers often feel this “limited policy” on their skin not to mention, the opportunities that faded away due to lack of courage. Nevertheless, don’t feel discouraged, the best of the best is on its way.

Every individual on this planet has immense potential to accomplish almost anything! Nonetheless, underestimating one’s capacity has become societal reality – a problem that needs to be addressed with caution. Before you enter into the world of brain-philosophy, try to broaden your perspective.

According to neuroscience experts, every possible change starts and ends with you. In the light of this discovery detailed explanation rises to the surface. Every personal trait associated with you, no matter how complex or straightforward may seem, influences your everyday motion. This neuro-chemical represent the foundation for any transformation or change that may occur.

To put it differently, it’s evident that souls are of immaterial nature, according to many cultures, beliefs, and religions. However, no facts can support nor oppose this theory or philosophy.

On the other hand, free will is something that people still have a tough time understanding it. Imposed opinions promoted through media channels are trying to suffocate that freedom. Logically, every person needs to choose its path, but that’s not the case.

Souls, mind, free will are running up against a brick wall of unproven theories, probably never to be proven. Patricia Smith Churchland – the author of “Brain-Wise,” suggests a new point of view to emerge. As an illustration of this advice, she advocates for something natural to all people like consciousness.

If all other things create divisions, self-awareness despite its mystery is the only absolute merger of humanity. In order to design a pattern of perfectly instinctive and straightforward neural activities, free will cannot be missing. In what way does this affect philosophy?

Philosophers even today tend to “play” with big questions, conspiracies, and mysteries. To get one step closer to them, help from the other disciplines is crucial. Over the course of hundreds of years, science has reached a new stage and progressed to a point where the humankind has managed to resolve many questions, leaving only a dozen more left.

Neurophilosophy represents a merger between newly established neuroscience and ancient philosophy.

The mastery of writing an inspiring book is composed of precisely defined facts, breathtaking theories, and most importantly intriguing mysteries. None of them are missing, which gives a clear sign that this book will encourage you to think and separate facts from ideas.

A prodigious amount of research has been done in order to compile many things into a single masterpiece. Patricia Smith Churchland announces a new scientific discipline known as Neurophilosophy, a term used to indicate two utterly different perspectives.

According to her, relying on single one of them is going to narrow down your spaciousness and leave you strangled into your shallow thoughts. A broader view is vital to forge the brain-soul relationship which ultimately melts into a single unit.

Division exists between science for analyzing the mind and inner knowledge for understanding one’s self. Can we integrate these two types of disciplines? The answer is yes! Science remains a dusty book even today, not every mystery is resolved, and as a consequence of that, a new idea has risen.

Key Lessons from “Brain-Wise”

1.      Discover the real “Self.”
2.      Epistemology’s two vital questions
3.      Mind tricks and true self

Discover the real “Self.”

Descartes above other things declares that humans have a conscious immaterial part in themselves – known as the inner-self (which is not the egoic personality).

Although this field is far beyond the reach of Science, NeuroPhilosophy enters into a whole new world by explaining the existence of it.

Epistemology’s two vital questions

Epistemologists tend to answer two questions:

1) How to define knowledge, and

2) Where to find it?

Mind Research is perhaps the best way to solve this enigma. Seeking knowledge doesn’t make you a knowledge-seeker. You have to know where to look at.

Mind tricks and true self

The brain is like a factory – referring to its various functions. Investigate around that “I” notion – become vigilant.

Don’t take this as persuasion; your outer self is just one aspect. To understand the whole package, dig deep into your heart and find the immaterial entity.

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“Brain-Wise” Quotes

My considered opinion is that no argument for the existence of God is even a little convincing, and to that degree, I find the hypothesis that God exists to be improbable at this time. Click To Tweet Hume made the deeper and more penetrating observation that an agent’s choices are not considered freely made unless they are caused by his desires, intentions and so forth. Click To Tweet If the brain organization dictates the general form of experience, what do we actually know about the real world? Click To Tweet The most important conceptual tool for making early progress on nervous systems was the theory of electricity. Click To Tweet The weight of evidence now implies that it is the brain, rather than some nonphysical stuff, that feels, thinks and decides. That means there is no soul to fall in love. Click To Tweet

Our Critical Review

People use emotions to improve their decision-making abilities, but neuroscience is something more profound.

No evidence of the “immaterial” exists, but it’s one of those things you must feel rather than see! Our team contributes to the clarity and encourages you to dive into neuroscience to discover your life-mission.

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Wikinomics Summary

Wikinomics Summary

How Mass Collaboration Changes Everything

We live in a world which transforms rapidly. The digital age creates many new circumstances for all of us. It poses new opportunities, new constraints. So what has changed? And how do those changes affect you and the age of Wikinomics? Our “Wikinomics Summary” explores these questions and many more.

Now, let’s dive right into it.

Who Should Read “Wikinomics”? and Why?

It is relatively challenging to specify a group of readers to whom this book would be intended. Magnificent piece of work written for HR Managers, Scientists, Futurologists, and Experts who wish to expand their views and get a broader perspective of where this digital age is going.

Students known for their thirst for new knowledge would find Don Tapscott and Anthony D. Williams’s work as one of the most extraordinary and exceptional business guides they have ever read. Known for its first-person examples and high-quality tips “Wikinomics” is no wonder an all-around book that can answer any business related question.

Next, before we thoroughly examine the book’s content, we’ll cover the authors’ bio and their expertise.

About Don Tapscott and Anthony Williams

Don Tapscott

Don Tapscott was born on July 1, 1947, in Toronto, Canada. He is an author, consultant, business innovator and executive that is focusing on combining different business strategies that would generate an organizational transformation in the society. As a founder of New Paradigm, that is currently owned by NGenera,  and as a CEO of the Tapscott Grouping,  Don Tapscott encourages companies to overcome organizational boundaries by associating with the latest technologies.

Anthony Williams

Anthony D. Williams is a Canadian Born author, a senior fellow at the Lisbon Council, founder of the Anthony Williams Consulting in Toronto and a strategic adviser to different governments, global institutions, and other Fortune companies. He was born in 1974 in Toronto, Canada. Anthony Williams and Don Tapscott as co-authors of Wikinomics are repeatedly dismissing any criticisms based on their book without answering any of the critics.

Okay, now that we covered the basics, let’s continue with the detailed summary.

“Wikinomics Summary”

Don Tapscott and Anthony D. Williams through their Wikinomics book try to intrigue readers in numerous ways. The book examines all possibilities of massive data sharing and participating in open-source software that is available to all business participants, consultants, and experts.

Back in the old days, sharing and delivering an information required a lot of effort, now all you need is a computer with unlimited access to all sorts of free encyclopedia sites. So to speak every user is familiar with the fact that the digital era contributes to a new highly educated population.

Now, what can you expect while reading the book?

Well, some of the examples that you may run into while reading Wikinomics would probably sound familiar, while others may seem a little surprising and maybe even shocking. These authors are so intently a part of the new era that makes them feel obsessed with knowledge -seekers – for instance,  sometimes specific actions or changes that are done by few enthusiasts seem like some internet transformation procedure.

However, for the majority of times, these enthusiasts fail to provide the precise definition or supporting and digital data.

Wikinomics wants to inspire readers to adjust their way of thinking to the new dynamic and digital age, by becoming critical decision makers, educated and proficient in the business sphere in almost any industry.

Here’s the thing:

The end reader would feel like he is reading some business guidebook, changing its point of view from time to time and for the majority of times, it would sound like a proclamation of ideas and concepts, valuable to the business community.

The world would continue to change and evolve. Therefore mass collaboration process would represent a vital factor in those changes. The new era would be built on openness, globalization and business integration. Organizing data would become much easier as finding data and sharing it would be a relatively easy process to conduct that can lead to minimizing organization boundaries that we’ve faced earlier.

A few broad key lessons can be extracted from the book’s content. Which are they?

Read on!

Key Lessons from “Wikinomics”

  1.      Understand Wikinomics
  2.      Four Basic Principles of Wikinomics
  3.      Ideagoras and their meaning

Understand Wikinomics

“Wikinomics” is the single letter word combined with two terms: “wiki” (that represents something being done quickly and fast) and “economics,” as such Wikinomics represent a term of quick interaction. These interactions are made possible by the digital opportunities that we’re able to take advantage of in today’s society. “Old-fashioned ” traditional businesses still maintain and keep unnecessary and evident boundaries.

These organizational barriers are backed up with a tightly controlled economic captivity of limited information that flows in and out. If you as a company implement Anthony Williams and Don Tapscott’s principles and norms, all shareholders will notice an instant “freedom” change, that would indicate long-term success.

Four Basic Principles of Wikinomics

The four primary principles that forge Wikinomics are: “Open communication, peering, sharing of information and globalization.” Openness or Open Communication refers to inciting open-society mentality with freedom of speech in a transparent, clear and concise way in favor of eliminating any organization boundaries that may occur among the shareholders.

Sharing of Information as the names tell us indicates an easy, fast and limitless way of accessing all sorts of data. “Peering” is an integral part of open society. It illustrates business and organizational interactions among the employees to be held collaboratively, not hierarchically.

Globalization makes us aware of the fact that overseas competition and partnerships are going to occur as soon as any company decides to infiltrate its product to the global market.

Ideagoras and their meaning

In ancient times, people used to meet in places called agoras (today’s marketplace), where philosophers gathered and taught the people on different subjects. Today’s online world shares the same idea as Ideagoras back then, Modern Ideagora represents something similar to a virtual “marketplace of ideas, financial solutions and concepts.

The Modern Ideagora concept is still in the process of development, yet solid and visible examples are present in every corner. As an example we would take the case where: Approximately 100,000 Scientists from 175 countries are assembled in one InnoCentive Service where they can share ideas, information, data and ask questions.

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“Wikinomics” Quotes

“Peering succeeds because it leverages self-organization—a style of production that works more effectively than hierarchical management for certain tasks.” Click To Tweet Increasingly, we are all wittingly and unwittingly co-conspirators in building one massively sophisticated computer. Click To Tweet All one needs is a computer, a network connection, and a bright spark of initiative and creativity to join the economy. Click To Tweet The new web is about verbs not nouns Click To Tweet

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Our Critical Review

In “Wikinomics” the authors try to illustrate their narrative by presenting examples of companies and projects that have succeeded by using group collaboration. Although various examples are cited, which are credible and serve their purpose, the authors use an authoritative tone to present them, which may put some readers off.

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Capital in the Twenty-First Century Summary

No economics book published in recent years has had as much impact as Thomas Piketty’s “Capital in the 21st Century.” The book is a masterpiece with over 600 pages, which discuss how globalization and economic development impact our lives, the economy, and the contemporary world. Piketty, after years of research, brings us a major essay on how capitalism generates inequality for society, increasing the concentration of wealth. In his work, he traces a history of how the economic regime has reached its present state and assesses a future prognosis for the world economy.

The work is a benchmark for economic studies, but the 12min team knows that not everyone has the time to devour this bible. That’s why we synthesized the book and created a micro-book so you can learn its key ideas in no time. Shall we go?

Introduction

Capitalism is a powerful force in economics, with a long history of entrepreneurs who have worked hard creating companies, making money, and returning it to the economy in the form of investments. With its roots in the fourteenth century, this economic system has been central to the construction and development of many markets in the world. Economists have argued and defended capitalism over the centuries, and the system shows no signs that it will move in another direction.

However, while it is clear that the system is both fascinating and successful, it also faces an imminent and growing threat of unequal wealth. Capital in the Twenty-First Century, by Thomas Piketty, takes a deep look at the issues capitalism raises. It describes the foundations of capitalism, showing how an uncontrolled capitalist economy can lead to a great and dangerous chasm between the middle and upper classes. Each statement is supported by extensive data and research, as evidence of past trends as well as actual statistics. Once the problem has been established and exploited, Piketty then proposes a revolutionary solution that if put into practice could change the face of capitalism and economies around the globe.

Capitalism Can Lead To Wealth Inequality

To understand the problem with capitalism, you must first understand how capitalism works. Capitalism, in essence, concerns the production of goods and services with the primary purpose of making money, instead of exchanging it for other goods, food and clothing, as was done in the past. A simple illustration of this is that a farmer cultivating seeds for the sole purpose of selling them on the market for profit. In time, the farmer decides to invest part of his profit in seeds and equipment to produce more. What it reinvests is known as the “capital”, which are essentially the tools or money used to generate more money. When he sells his crop to the market, the money he earns back is called “return”.

A portion of the return will be reinvested as capital again, while a portion will be used to pay those doing the work (in this case, the farmer himself) – and the cycle continues. Over time, the farmer may begin to think about his rate of return, which is the profit he recovers from his investments, expressed as a percentage. When the farmer’s operation begins to become more profitable, he may choose to hire more workers to increase his workforce and thus his productivity. It means that he will have to spend more money on labor, but now his returns must also be much higher. However, if the farmer’s profits begin to grow faster than his operation, his capital will not be needed. As an alternative, the excess of money will go directly into his pocket, and the inequality of wealth begins to develop.

The same principles that apply to the farmer apply to the rest of the economy. If the rate of return continues to grow, but the economy does not grow with it, owners and organizations end up generating a disproportionate amount of wealth to save capital. While it is true that this wealth can often be transferred to capital and used to create new jobs, the result is that, ultimately, a very small percentage of people hold a very large percentage of the wealth of an economy. Also, being the main force behind capital gives owners great power over job creation. When it comes to planning the future of our economy, placing a significant amount of power in the hands of such a small group of people can be considered dangerous.

Understanding Growth Rates As The Key To The Problem

Unless changes are made, power imbalance only worsens over time. A constantly growing global economy is healthy, but the rate at which the world’s markets grow needs to remain similar to the rate at which its capital return increases. We call these rates “growth rate” and “rate of return on capital”, respectively. If the rate of return is off the scale of the rate of growth, there is a financial imbalance, followed by social inequality. That is a problem that needs an immediate solution since even the smallest gap can grow over time to dangerous proportions. It is best viewed by comparing market growth to population growth.

If the world’s population grew at a rate of about 1 percent each year, the number of humans on this planet would grow from just over half a billion in the 1700s to over 7 billion in 2012. Although a rate of 1 % does not look like much at first, it grows exponentially, reaching large numbers over time. The same principle applies directly to capitalism and demonstrates the great problem of the way in which it currently works. If there is a small but steady difference between the rate of return on capital and the rate of growth, the imbalance will lean heavily in favor of the currently wealthy. Although it takes a long time, the results are inevitable. In the end, allowing unequal growth creates a dangerous social imbalance that only worsens over time.

Countries’ National Capital Profile Change Each Century

Simply put, the national capital is the sum of a country’s domestic capital – assets they own in their own land – and their international capital – assets that they own in other countries. Capital has increased and diminished over the decades, but possibly the most notable change has been in its nature. In the past, the land was the most important type of capital, but it gave way to industrial and housing assets. Historically, France and the United Kingdom found great value in international assets, but major global events such as world wars and the Great Depression began to exhaust the value of these assets. By 2010, foreign holdings of these two countries were almost worthless.

Domestic capital can also be divided into public and private assets. These two share an inversely proportional relationship: losses on public assets often mean gains on private assets and vice versa. It means that changes in public and private capital often do not mean changes in domestic capital, but understanding the difference between the two is important. The public assets of a government are always nonfinancial, as in the case of buildings and government structures, or financial, cash in the state. Private assets are simply assets that are not publicly traded. But capital was not the only thing which changed. The way governments deal with their debts has also changed throughout history, but some of the old methods have had unintended effects on the market.

Inflation (where the prices of goods rise) and private lending (where the government borrows from rich private citizens) are both common methods of dealing with public debt, and both present effective solutions. Unfortunately, these methods are quite brutal for the working classes, with the former reducing purchasing power and the latter by giving back power to the already wealthy. Although both methods are declining in Europe, their impacts can already be felt: as markets recover, the unbalanced distribution of wealth is still a real and present factor.

The First Fundamental Law Of Capitalism Helps Us Find National Income And More

To truly understand the complexities of global capitalism, one must understand its history, theory and carefully examine current trends. The first and second fundamental laws of capitalism are formulas that go a long way in explaining market behavior over time and do a great job of simplifying history and making real problems clearer. The first fundamental law of capitalism says that national income (α) is equal to the rate of return on capital (r) multiplied by the rate of capital/income (β). Simply put, the formula looks like this: α = r × β This small formula is powerful, making it incredibly simple to calculate national income, which is the total income received by everyone in a country.

As an example, if you know that the capital/income ratio (the rate that demonstrates how much capital can be received with a year’s income) is 5: 1 with a 4% rate of return on capital, the national income is 20 %. This law is very useful for finding national income, but it is also incredibly versatile and can be used to find its variables as well. For example, if you are looking for the current rate of return and you know the national income and the capital/income ratio, finding your answer is as simple as replacing the numbers in your formula. Because the rate of return is the measure of the amount of return received from investments, it is a very important statistic. The calculation of the rate of return is a simple formula making capitalism’s first fundamental law a powerful tool.

The Second Fundamental Law Of Capitalism Helps Us Understand The Its Monitor

The second fundamental law of capitalism says that the rate of capital/income (β) is equal to the rate of saving (s) divided by the rate of economic growth (g). For example, if an economy saves 20% of its income and has a growth rate of 4%, the capital-income ratio will be 5: 1 or 500% for the value of income of each year. This well illustrates the main problem: if a country saves a lot but does not grow at a rate high enough to keep the economy running, then the result will be an excess of capital, which is then distributed, to those who already have wealth. You can see how important growth is to the economy by simply increasing the growth rate by 1% in the example above.

The capital/income ratio falls to 4: 1, a significant drop. Simply put, this means that if in our example the economy grows only 1% more, the increase would be only 400% instead of 500%. That extra money could be distributed elsewhere, most notably to the middle and lower class families who need it. Capital is a potentially wonderful collection of resources used to create jobs and opportunities for those who do not have capital. But giving the largest share of a country’s economy to a very small percentage of the population is dangerous. These formulas allow us to see how critical the imbalance of wealth can be.

Capitalism Has Sufficient Strength To Support Great Setbacks

We have seen that inequalities can get out of control relatively quickly when not monitored. However, even with catastrophic problems affecting markets on a global scale, capitalism advances over time. In France and the United Kingdom of the nineteenth and twentieth centuries, a working-class, middle-class citizen was rewarded with a good life, food on the table, and money in their pockets. But it also allowed others no realistic chance of getting close to the extravagant wealth of those who inherited fortunes. That was a trend that dominated these centuries. But the world and the economy has changed, and with this, the richest soon found themselves losing more than they expected.

The period between 1914 and 1945 was full of events in the worst possible way. World War I struck hard, shaking the world both economically and politically. Just 11 years later, markets around the world plummeted in the widespread economic recession known as the Great Depression. The event began in 1929, and its effects were postponed until 1939 when combat shook the world again in World War II. These events hit the most prosperous members of society incredibly hard. In 1914, before the start of events, the top 1% of the income hierarchy in France controlled 20% of income. Between 1914 and 1945, that number plummeted to 7%. The top 10% lost control of 45% to 30% of the country’s income, bringing the lifestyle of the highest class very close to the middle class. With so many impacts on the top 10% wealth, one might think that the chasm between the upper and middle classes would be lower, but this is not the case.

Between 1945 and 2010, the top 10% recovered three percentage points, reacquiring 33% of the country’s wealth, and there is still a growing trend. Given the habit of capitalism to grow the percentage wealth at the top exponentially, this inequality is a concern for the future. Capitalism has had some setbacks impeding its efficiency and remains a powerful force that leads to wealth inequality. Research shows that citizens in the top 10% of Europe’s wealthiest countries in 2010 controlled 35% of the continent’s capital and labor. While in the United States, the top 10 percent controlled a huge 60 percent. These numbers serve only to illustrate the dynamics of capitalism: even with a world crisis spanning 31 years and markets breaking in several countries, time is all it takes to recover.

An Unnatural Interference Is Required To Reduce Inequality Significantly

Capitalism’s dynamics are powerful, able to take advantage of small growth rates to put excessive capital in the pocket of the already wealthy. The system as such only aggravates the inequality of wealth over time and shows no signs of improvement on its own. Some schools of economic thought advocate an approach without interference, believing that the economy will naturally regulate itself. However, as we have seen, even the 31 years of the economic crisis were not enough to permanently regulate the problem. What the economy needs is something unnatural. Here ‘unnatural’ simply means something that is directly created to regulate the inequality of wealth, opposing an external occurrence that unintentionally affects it. World wars are prime examples of natural interference, while progressive taxes (which are probably the best solution to regulate inequality) are unnatural interferences.

A ‘progressive tax’ is a tax that increases according to the income of who is taxed. This kind of tax would force the wealthiest and the savers to pay a higher rate than the others. Different forms of progressive tax have been and are being applied around the world. But in the United States and the UK, they are decreasing, reducing their effects and, in some cases, reversing them. For example, in 2010, the poorest 50% in France paid taxes at rates of 40-45% and the next 40% paid slightly higher rates of 45-50%. That sounds ideal until it is revealed that the rates paid by those at the top actually fell, with the top 0.1% paying only 35% and paying virtually no capital wealth tax such as land, factories, and machinery. Progressive taxes are the step in the right direction, but for there to be some permanent and real change, the capital problem needs to be pointed out.

A Global Tax On Capital Would Solve Many Problems

With capital goods commonly free of taxes, something entirely new must be created to counter the problems generated by capitalism. A new and progressive global tax on capital solves these problems by inhibiting the power of capitalism over inequality and allowing for greater balance. Doing so would be a long and severe process, including elaborating a tax plan satisfactory to the whole world, but the efforts involved in creating a tool made specifically to regulate the inequality of wealth would be worth it. To achieve this, a high level of financial transparency would be required, allowing the general banking information of countries and individuals to be monitored. That would include assets held overseas.

In today’s modern society, it would be easier to achieve this, thanks to electronic transfer records. This type of tax would be a perfect tool: in fact, too perfect to be true. It is almost impossible to get all the nations of the world to embark on this idea, as well as finding the perfect planning and support from rich countries. In fact, planning would take a long and impractical time, and the richest members of society would lose so much that they would never agree with this idea. A progressive global capital tax is a utopian concept, but that does not mean that it is not worth considering as a goal. Having an idea of perfection allows economists and governments around the world to see how a world with drastically less inequality would be and then becomes a strong reference for future policies.

Final Notes:

What started as a system that helped managers put their money back into the economy has grown almost overwhelmingly. Now, dreams of riches and fortune are virtually impossible for low and middle-class citizens in many countries around the globe. Wealth inequality is astonishingly high, and something needs to be done. These are not just theories. Careful history studies reveal the power of capitalism dynamics, even in the face of the worst financial catastrophes in history and two of the greatest wars the world has ever seen. The facts shown point to one conclusion: wealth inequality is not a problem that will solve itself. We need policy changes that focus squarely on the main issues to end the chasm and level the playing field again.

When we look at the problems of capitalism, it becomes clear that a progressive tax is the best solution. But in many countries, this type of tax does not affect capital, which is often exempt. Therefore, Thomas Piketty suggests that a progressive tax should be applied directly to capital globally. That would be accompanied by new transparency laws. Although this model is unrealistic, it demonstrates an idea for a perfect economy: an economy in which wealth inequality is minimal and the working classes have a chance to become wealthy through hard work.

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