The Upside of Wasteful Speculative Bubbles and the Downside of Efficiency - William Janeway

The video explores decision making under uncertainty, focusing on financial bubbles' significance at micro and macroeconomic levels. It highlights the historical prevalence of bubbles, their role in funding innovation, and the consequences of financial folly. The discussion emphasizes the importance of tolerating waste and inefficiency for economic growth, drawing insights from historical and contemporary economic thought.

What is the significance of decision making under conditions of radical uncertainty at the microeconomic level?

How do financial bubbles in equity markets differ from those in credit markets?

What historical observations can be made about the prevalence of stock market booms?

Discuss the role of speculative bubbles in enabling investments that would not be made by rational planners.

What lessons can be drawn from the history of venture capital regarding efficiency in economic systems?

How does tolerance of waste contribute to the growth of productivity and living standards?

In what ways can the concept of trial and error be fundamental to economic growth?