@Sivation Risk is something that private enterprise is very curiously dysfunctional about.

To one extent, incorporation and corporations are risk-externalising machines.

To another, they specifically ignore systemic risks or those that they don't understand / feel unable to control.

Some of that latter is explained, I think, by investors' incentives, where to an investor a given enterprise is simply one element within a larger risk pool. Failure is unfortunate but a diversified event. For those directly engaged with an enterprise (its workers, often officers, vendors/suppliers, customers, and frequently neighbours within the space the enterprise operates), that risk is not diversified and is far more consequential.

You could also include employees, consultants, and/or contractors who have high mobility relative to the firm itself. If you're able to hop to another gig, or use a firm as "resume-driven development" (common practice in infotech), then personal and organisational risk profiles are similarly misaligned.

Much of the schizoid behaviour of businesses regarding various risks makes far more sense in this context.

@zombiecide @ajroach42

#risk #incentives #OrganizationalBehaviour #diversification #PrincipleAgentProblem #Capture

@pluralistic Thanks for this, it's useful and desperately needed.

"Vote with your wallet" is part of the "market it harder" solution mindset to market failures. And it Does Not Work.

I'd only started to realise this in recent years. One mention from about a year ago at HN:

https://news.ycombinator.com/item?id=26423351

It's also helpful to remember that private enterprise also has a regulatory capture problem, though there it's called the #PrincipleAgentProblem or just straight up #fraud

And it's taken seriously when it's enacted against stokcholders and financiers.

#VoteWithYourWallet #BullshitIdeasThatMustDie #Neoliberalism #MarketFundamentalism #MarketFundamentalists #Libertarianism #GetPolitical