Tuesday 4 October 2011

The problem of scale

I've been reading Ian Morris' Why the West Rules - For Now over the past couple of weeks (some of the blow by blow in the earlier centuries might have made way to get it down from its 600+ page length) and I've been struck by two things. First the assertion that there have at points in history been barriers or limits to development that have held until conditions or technology moved past a certain limit. And the second is that the problem of scale seems writ large even though it is not really brought out in the text.

The second for me is an integral part of the first and I'm not saying Morris doesn't recognise this or in some ways discuss it. However I thought it was worth making it really explicit. Simply put, big things are not small things made large.

Probably the best piece on this in management literature is the classic 1972 Harvard Business Review article by Larry Greiner Evolution and Revolution as Organizations Grow which discusses the differences between moments of smooth evolution and disruptive revolution based on the age and size of an organization. The idea that the small and the large don't work in the same way is fundamental in physics, in the difference between Newtonian mechanics and the strange world of quantum mechanics (for a musical version of this have a look at the Symphonies of Science the Quantum World).

And in Morris' text what I see lurking is that large countries are not big small countries, if I can mush all of that together. Or to put it another way, the scaling of companies into national economies and from national economies to the global economy involves scaling steps that are discontinuous.

This is very important when trying to understand commentary on the nature of the current recession and the actions that are being taken (or not) to try to reignite growth. How the narrative on how to address the problems is structured depends on what scale you're used to working at. Paul Krugman wrote about this in a direct way in his 1996 piece, again for Harvard Business Review, A Country is Not a Company, where he strongly argued for not following the instincts of CEOs of large companies in terms of economic policy.

It may also point to significant fault lines in economics, between those trying to work up from the microeconomics of companies to the macroeconomics of countries. Maybe, again in parallel to physics, there is no grand theory of everything.

Best

F

2 comments:

  1. heard ian morris launch the book, i was alarmed by some of his assertions. i'm not convinced that war/conflict is an essential stepping stone to development.

    what about fractals? 'if big things are not small things made large' could big things be a large collection of similarly structured small things? if you understand the individual small things then the big things make sense?

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  2. Yes, some of the Morris commentary is interesting, something which must be a risk of seeing across such a long time period and seeing the conflicts as dramas and inevitable.

    For me the point in the small/large is that the laws or expectations we have at the different levels must differ. We get into trouble when we carry expectations from one level of scale to another. Whether there is a fractal nature to the structures in some ways doesn't impact this, as if the outcomes are very different that is the important thing. The other thing for me is that fractals are well observed in naturally occurring systems, whereas economies and companies are anything but naturally occurring!

    Best

    F

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