Tyler Cowen: Production Function

Tyler Cowen: Production Function North Star Podcast

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Tyler Cowen is an economics professor at George Mason University. He runs the Mercatus Center, which bridges the gap between academic ideas and real-world problems. He’s published a new post every day for the past 17 years on his blog called Marginal Revolution, where he writes about economics, arts, culture, food, and globalization. Beyond that, he also writes for Bloomberg and hosts his own podcast called Conversations with Tyler.

Tyler ends every episode of his podcast asking about other people’s production function. How do you get so much done? What’s the secret sauce of all that you’ve accomplished? This episode is entirely devoted to that question. But this time, I’m asking Tyler. We started by talking about why there aren’t more Tyler Cowens in the world. Then, we moved to Tyler’s process for writing, such as choosing article topics and editing his work. Later in the podcast, we discussed Tyler’s process for choosing friends, why he would travel across the world to visit a new country for just ten hours, and what he’s learned from high-powered people like Peter Thiel and Patrick Collison.

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Find Tyler Online:

Website- Marginal Revolution

Tyler’s Books

Other Links:

Essays in Biography by John Maynard Keynes

Progress and Poverty by Henry George

My Struggle: Book 1 by Karl Ove Knausgaard

My Struggle: Book 2 by Karl Ove Knausgaard

Margaret Atwood

Daunt Booksellers in London

Craig Palsson  

Patrick Collison


Show Notes

2:40 – What Tyler considers his compounding advantage.

5:56 – Why being born as an intelligent person is not as important as developing knowledge.

8:23 – How Tyler maximizes the value of his consumption and minimizes the drawbacks.

9:19 – What draws Tyler to the people he likes spending time with, and what he likes best about their friendship.

12:33 – Why Tyler feels that the way he has lived his life has meant has not given anything up.

15:35 – How the fundamentals of productivity came intuitively to Tyler.

17:41 – Why Tyler writes in his particular style not by choice, but by necessity.

22:19 – Why the things in Tyler’s life that bind his output aren’t what you think.

24:06 – How to develop new ideas while staying focused on the subject and not getting tangled.

27:36 – Why Tyler sees art as one of the most important and beneficial things you can spend your time and money on.

32:41 – What writers can learn about inspiration and consistency from musicians and visual artists.

37:16 – Why Peter Thiel has impacted Tyler so deeply and why Tyler believes he’s one of the greatest thinkers of our time.

40:30 – How Tyler is able to extract more from his reading than other people do.

45:44 – How understanding most other people’s intelligence is higher than his in most fields gave Tyler an edge over other thinkers.

49:00 – Why Tyler sees a new visibility of talent in people and how he is using this visibility.

55:24 – How Tyler constructs his interviews to maximize the freedom of his guests to speak freely on what they love.

1:00:03 – How to develop skills as a teacher and where Tyler believes the strengths of a good teacher lie.

1:03:34 – Why the novelty and beauty of visiting other cultures excites Tyler so much.

1:07:18 – How Tyler makes the most out of his travels.

1:13:32 – Why sitting in a suboptimal seat at a concert may give you worse sound but a better understanding of the music.

1:16:55 – Why knowledge workers are often not motivated to improve their skills.

1:20:48 – Why Tyler still responds to every email and loves it.


Transcript

Time, open-mindedness, and speed reading as production functions

David Perell: So Tyler, why are people so modest about describing their production functions?

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Tyler Cowen (02:13): It’s high status to be modest. If you have to boast, there’s a sense people don’t already know how wonderful you are. So when you interview actually super productive high status people, they’re almost always self-effacing. And in my now more than 100 podcasts Conversations with Tyler, I’ve hardly found anyone willing to be anything other than modest.

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David Perell (02:34): So what is your personal accumulating advantage? So this is actually a little bit different than your production function. So most successful people that I know have some kind of internal compounding advantage, just like a company. What is yours?

Tyler Cowen (02:49): I started early and I kept on going for many, many years as part of it. So studying economics and social science, I started at age 13 to 14 pretty seriously with even a bit before then. And now I’m 58. So just having 44 or 45 years of truly absolute full-time work doing something is a big advantage. And most of my peers in terms of age, I’m not saying they have stopped, but they typically have stopped learning or stopped really trying to self-improve. So one, but not the only advantage I’ve had is just a high absolute number of years to work on things. And also good health, really the whole time. Every year, every month, actually every week I would say. But when I was 10, I had my appendix out.

David Perell (03:37): So take someone like Larry Summers. You really admire his production function. He is somebody your age who’s continued to get better and better. What have you learned from Larry and his production function that you’ve tried to apply to yours?

Tyler Cowen (03:51): Well, Larry started very early. His two parents were economists. His two uncles, Kenneth Arrow and Paul Samuelson were Nobel laureates in economics. Talk about econ royalty. He started very early over the dinner table, and he’s kept at it. He’s a bit older than I am, I think maybe four years older. And he had I think one year of poor health. But every year, he’s worked at being better, having a deeper understanding, knowing more data, knowing more about economies. So I would say that’s one of the things about him I’ve copied.

David Perell (04:21): So why aren’t there more Tyler Cowens in the world?

Tyler Cowen (04:24): You have to ask at some point, what are the returns both to starting early and to continuing fairly late in life? So starting early, you give up a normal childhood. I would say all for the better. Awesome. Bring it on. Let’s double down on that one. But most people don’t want to do that or it just doesn’t occur to them. They might in fact do it if they saw more role models.

And then the other is once you reach a certain age. I would say for many economists, maybe it’s 45 or late forties. You can just do consulting, or give the same talk again. Or there are many paths you can take that have quite high income or perks, where you don’t really have to get any better if you’ve done well at all. So why go the extra mile to keep on improving? I would say for most people, the returns just aren’t there. And there may even be kind of polarization returns to being more political or partisan.


CONTENT SPOTLIGHT: WHAT SHOULD YOU WORK ON

  • Looking like you’re being productive is often a better strategy for career advancement than actually being productive.
  • Risk aversion is guiding our most talented people into mind numbing, anti-innovative careers.
  • In order to do something truly innovative, you need to drop out of the system entirely or be so independent-minded that people call you a lunatic.

    If these ideas speak to you, you’ll enjoy my essay on deliberately choosing your work.


David Perell (05:21): So why do you do it?

Tyler Cowen (05:22): I think I’m just compelled to. But also you could say, well, it’s a niche strategy, right? So if these other people become lazier or more polarized and I’m looking for a niche, because I’m on average actually not as smart as most of them. Then my niche would be to keep on going. That’s my niche. So I do think just in the kind of narrow self-interested sense, it’s also been better for me. It’s not just some active altruistic nobility to keep on going. So it’s that too.

David Perell (05:50): So assuming that you aren’t saying this because we’re with low status Tyler today, would you have knowledge without intelligence, or intelligence without knowledge?

Tyler Cowen (06:01): I’m not sure operationally, what’s really the choice I have to make there. Could you put it in terms of concretes?

David Perell (06:10): Yeah, I would say intelligence is what you’re born with. Knowledge is what you develop in a very simple two by two.

Tyler Cowen (06:15): I don’t think my intelligence is that high. It’s pretty high. But one of the early things I learned playing chess, which I did when I was very young, and I was very good. But there were always around people who were better than I was, including at young ages. And just to learn there will always be people smarter than you was a great lesson to learn early. And a lot of smart people never learn it, but I learned it by age 11, age 12.

David Perell (06:42): At what point did you realize that you were Tyler Cowen? Because you were one of the top chess players in the state of New Jersey when you were what, 15 years old? So at what point did you say, “I’m a little bit different. I’m going to go down this path. And I’m now comfortable being myself and doubling down on that.”

Tyler Cowen (06:58): When I was 15, I won the adult state championship of New Jersey in chess. But I already knew I didn’t want to be a professional chess player. I had more or less figured that by the time I was 11 or 12, right after I started playing. And also I knew there were just other people my age, Kasparov being one of them who were better than I was. So I thought I need to pick a different area, apply some of the same methods.

Right off the bat, learned to compensate for the fact that yes, I’m pretty smart. But there are just always people who are smarter, like Ken Rogoff. He’s smarter than I am. And he was a better chess player. He’s a smarter economist. So somehow working around that to both think early on, you’re really pretty smart. And you’re not that smart. And I figured those two things out early, that’s actually pretty smart. That was part of my secret.

People have one or the other. They’re discouraged or they’re like, “I’m number one in my high school class.” Right? That’s kind of a negative in a way. It just teaches you to play the game of doing well what other people tell you.

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David Perell (08:02): When you go out for dessert, how do you choose what kind of ice cream to order?

Tyler Cowen (08:08): Well, I only eat really chocolate ice cream, so I’m not sure choice enters into it. If there’s very good vanilla ice cream combined with something chocolate, I can like that as much. If it’s very good, I’ll prefer that over the pure chocolate. But that’s the only choice really.

David Perell (08:23): Well last time we were together, we were at Hudson Yards. And you asked for these very smallest chocolate size. And even the small was too big for you. So then we asked for the sample size, and you had three bites. And then you got to the point of diminishing marginal returns on your chocolate ice cream, which I think was the best Tyler Cowen story I’ve ever had.

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Tyler Cowen (08:43): Well, I don’t like to eat too much dessert. It’s bad for me. But if you think a lot of the value of consumption is either memory or anticipation, just by cutting a portion size in half or to a third, you’ll get more than a half a third of the value. People don’t do that consistently. I think they’re too shortsighted. They just think, “I want to eat this and finish it.” It’s a social norm that you clean your plate. It’s a very bad norm in my view. It probably once made sense when food was scarce, right? But when food is very plentiful and being overweight is a bigger problem, you really want to learn how just to eat less on your plate.

David Perell (09:18): To take a very utilitarian model of friendship, are there diminishing marginal returns to it? So say that you become friends with someone who’s really smart. You then get to know them. You get to know how they think, you incorporate their worldview. At what point you’re just like, “Hey, I just don’t really feel like being friends with this person.”

Tyler Cowen (09:37): That in general hasn’t happened to me. I think the people you pick, ideally you’d like increasing returns where they keep on developing. And you have such a common language and a common history with them, you can keep on making it better. I’m not predicting that always happens, but it’s what you want to look for. And you ought to be able to achieve it a fair amount of the time. At least if you yourself are continuing to improve, you should be able to attract such people and maintain your connection with them.

David Perell (10:06): What kinds of people do you want to attract? How do you look at friendship and how it plays into your own production function?

Tyler Cowen (10:15): Just people who are in areas I don’t know so well, but I know the area or how they think well enough to communicate with them. That’s what I find very valuable. So it’s not necessarily other economists at all.

David Perell (10:29): So what kinds of people have you learned the most from?

Tyler Cowen (10:33): It depends on the time horizon. Very early in my life, it was 100% chess players and a small number of junior high school teachers, grade school teachers. Now a lot of tech people, just people in the world of ideas, people in my Twitter feed. My preference is to be flying all around, meeting new people in different countries all the time. And right now, I can’t do that. So I feel like I’m at a lower level of learning productivity, at least along that one dimension. But that to me is painful.

And those are often new people. You only see them once. Like you’re in Korea, you have a great two hours with someone. Maybe you’d like to continue it, but odds are you won’t.

David Perell (11:12): What is it about people in Silicon Valley that make those friendships so fruitful for you?

Tyler Cowen (11:21): Thinking outside of the box. They’re super smart, but typically not that well educated. So they haven’t just learned the same things that other people have learned. They’re both thinkers and people who have had to do things and pass various reality tests. And that makes them much, much smarter. So many academics are lacking in that. The only test they’ve ever faced often is can I publish this piece? And I think that’s stunting.

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David Perell (11:47): So is education then overrated?

Tyler Cowen (11:50): Well, by whom? I would by the country as a whole, it’s still underrated. But by smart people, it’s definitely overrated.

David Perell (11:58): But maybe learning is actually what’s underrated in education in everyone learning the same thing is the thing that is overrated.

Tyler Cowen (12:06): Well but if you look at American colleges and universities, they typically don’t publicize their completion rates. But I suspect they’re between 38 to 40%. And a lot of those people ought to finish, but they don’t. They lack the self-confidence, the discipline, or their family has money problems. And I think if they assigned higher value to finishing, their lives would be better. Even if they wouldn’t in every case, always learn so much.

David Perell (12:33): What’s the biggest thing that you’ve had to give up to be Tyler Cowen?

Tyler Cowen (12:39): Well, give up. I mean, did I ever have it? So I’m not sure it’s anything. If I hadn’t done what I’ve done in terms of reading, and writing, and traveling a good deal, it’s not like I would be playing center field for the New York Mets. Right? So the counterfactual-

David Perell (12:58): Right, you’d be a basketball player. Of course, you’d be in the NBA.

Tyler Cowen (13:00): Point guard for the Los Angeles Lakers. I’d be stepping in to replace Avery Bradley. So I don’t really view it in terms of sacrifice at all. Maybe I should think more along the lines of opportunity costs like a good economist, but somehow I don’t.

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David Perell (13:17): But maybe for example, you don’t do drugs. You don’t drink alcohol. Maybe you’re missing some fundamental part of the human experience.

Tyler Cowen (13:24): Probably I am. But even if I were driving a bus, I still wouldn’t drink or take drugs. I just don’t feel like I would enjoy it. And drinking, I’ve tried. I know I don’t enjoy it. So it’s not that the alternative is a world class sommelier, or a wine steward, or I’ve had the best LSD experiences of anyone out there. I’m the new Timothy Leary. For better or worse, none of those are open to me. So again, not an opportunity cost as I view it.

David Perell (13:53): Not even the best LSD experience?

Tyler Cowen (13:56): I severely doubt that I would be very good at doing LSD, reporting on it, understanding it. Obviously I haven’t tried, this is speculative. But I think the mere fact that I’m repelled by that notion of giving up control and taking that particular kind of risk. And people who advocate LSD, they don’t even describe their trips as very fun necessarily. I’m just like, I don’t want that. I want to see a good movie. Which I know I’ll really enjoy. That way I’m super complacent, right? Complacent Class is about me.

David Perell (14:29): So walk me through why you don’t drink. Is it a productivity thing? It’s an enjoyment thing, it’s a health thing? What’s going on there.

Tyler Cowen (14:39): I believe the health consequences of modest drinking are neutral to very, very, very tiny positive. I think the chance I would develop into a problem drinker is essentially zero. I’m quite sure it would harm my productivity, even a small amount of alcohol. And once you’re not drinking, you become sensitized.

I very much enjoy the taste of very good red wine. And I’ve had very, very good red wine. I once went to an event in France. It was the Journal of Wine Economists put it on. And they pulled things out of the salary, which I tried where they were mind-bogglingly good. A clear notch above an expensive bottle at a two or three star Michelin restaurant in New York. Like wow, this is amazing.

But at the end of the day, it didn’t interest me that much. And I’d rather have the productivity and specialize in other things. And I just don’t like being drunk. It gives me a headache. So why do it?


Like any habit, writing habits compound

David Perell (15:35): Why did you settle on an 11:30 bedtime?

Tyler Cowen (15:40): I think on average, it’s more like 11:26. But that’s when I’m tired. Maybe that’s a silly answer. But it’s a pretty good one.

David Perell (15:50): And what time do you wake up?

Tyler Cowen (15:53): It depends on the season. But typically, seven. And I write in the morning. First thing I do is go through most, but not all of my messages. I don’t respond to everyone right away. That would take too much time. But I see where I’m at for the day. And then I start into writing pretty quickly.

David Perell 16:11): So what does that mean where I’m at for the day? That would imply that you plan your days every single day, sort of new. And that there’s not a lot of planning going on in your life.

Tyler Cowen (16:25): Planning is a tricky word. I would say it’s intense, extreme planning. But planning to have a lot of open space. There’s an earlier Marc Andreessen essay, which he’s now kind of repudiated where he says, “Well, the way you should try to schedule is leave open a lot of time and then do important things at the last minute, and have big blocks of time for thinking, writing,” or for him programming perhaps in his earlier life. And I’ve still managed to do a version of that. And that works for me. But if I think of writing as the most important thing I do, I do that just every single morning. Depends on the year. Maybe in a lot of years, there’s 15 to 20 mornings where I just can’t write that morning. The most common cause of that would be in the old days, a 9:00 AM plane flight. And then I won’t write that morning, maybe won’t write that day. But otherwise every morning write. Total religion, Saturday, Sunday, Christmas Day, my birthday, I don’t care. Do it. No exceptions. If you write every day, you don’t even have to worry about how much you’ve written. It’s going to add up. And furthermore, the regularity of the habit pushes you along a learning curve. So you’ll get more done each day, and I’m still moving along that curve.

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Content Spotlight – The Advantage of Being a Little Underemployed

Morgan Housel wrote a great piece on the history of the forty-hour work week and how it doesn’t translate to knowledge work. It’s a perfect complement to this section about how Tyler schedules a lot of free time.

Read it here.


David Perell (17:38): So I want to dive into that. But let’s start by saying that in your writing, one of the things that you do a lot is lay out the arguments of views that you disagree with. Why is that so productive?

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Tyler Cowen (17:50): You understand the views better. You also start sympathizing with those people more. You begin to realize they might be right and you might be wrong. It makes your own arguments better. And sometimes, you’ll change your mind. So if you’re only just writing out the same tired version of some point that’s probably true, you become stupider. So the natural inclination past a certain age, which is not that big a number, is to become stupider de facto. And you do that by saying the same thing, even if it’s right. So I’ve always wanted to avoid that.

And I think you asked earlier what are your kind of different, special tricks? And the first I said was just having been at it a long time. But I would say that’s another one. Really being willing to entertain and indeed write out different points of view. And a lot of that I do on Marginal Revolution. But some of it is just stuff that never comes out anywhere.

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David Perell (18:45): What percentage of what you write do you publish?

Tyler Cowen (18:49): I’m not sure. It’s become higher. Maybe that’s worrying. But a typical book, there’s half of what gets published that doesn’t make it into the book on average. And I guess I think it’s worse. Or maybe in a few cases, too speculative, which is a different kind of worse. But usually just too boring or a little trivial. Or just I wouldn’t think it had a chance of being in the top half of the book. And look, people have enough pages of me if they want to read all of it. So just giving them more pages from their point of view, I don’t think is a high return.

David Perell (19:27): If you take a spectrum from clarity to beauty, you are far on the clarity side. You don’t seem like somebody who would sit back for draft number 17 and try to rehash a sentence to try to find the perfect, most elegant, purple prose to put on a sentence. Why have you chosen focusing more on clarity?

Tyler Cowen (19:48): I wouldn’t call it a choice. I’m not a good prose stylist. I’ve read really a great, great deal of poetry, classic literary prose. I think my eye and ear for it in the writings of other people actually is very, very good. But I don’t have that talent at all. It’s just like how I’m not good at thinking in terms of stories. I’m good at being either blunt and to the point or Straussian and complex, which is clear in a very roundabout way, but doesn’t look clear to the uninitiated. And that’s what I can do. So I do it.

I love the other kinds of writing, but I’ve never felt I could choose to have done them. And in a way, I feel I’m moving further from them. And I’ll just never do them. I never think, “I could write a novel,” or just the kind of things John Stuart Mill did. Those beautiful essays, like On Bentham and Coleridge. Forgetting about the fact that he’s much smarter than I am, just stylistically I could never come close to anything like that.

David Perell (20:44): That’s interesting. Because it implies that what you’re doing is you’re trying to double down on the things that you’re already good at. But it sort of contradicts with what you were saying about friends earlier. You like being with friends in areas that you don’t know. There’s something going on here where you’re saying it’s not even worth developing that skill. I’m just not good at it.

Tyler Cowen (21:04): But I have to know what the friends do to some extent. So I don’t have any taxidermist friends. Right? And I probably never will. Things like that. Or if I had them, it would be through family connections.

So I think with modes and styles, most people don’t have that much choice. With your friends, you do have more choice. That’s like a portfolio. I don’t have the skill or the temperament to have a portfolio of Charles Dickens-like literary writing. And then Tyler Cowen-like economics writing. There are people who’ve done that. I mean, John Maynard Keynes had both styles in a pretty phenomenal way. It’s greatly to be admired. And I’ve learned a lot from him. But one of the things I learned is I can’t do that.

You read Keynes essays and biography. To me, one of the most beautifully written works in English in the 20th century, as are some parts of the general theory, though they’re not always clear. But also a lot of early Keynes on Treaty of Versailles or A Tract on Monetary Reform, just beautifully written, clear economics. Kind of in the way Milton Friedman could write. And I think actually Keynes as a writer influenced Friedman.

David Perell (22:19): What’s the binding constraint on your writing output?

Tyler Cowen (22:23): I think there are quite a few. So I don’t feel I have so many ideas that don’t get written up. At any moment in time, I might have a few, but they tend to come out pretty quickly or in the next book. So the ideas bind me pretty tightly. But I think also time. If I had twice as many ideas. And believe me, I don’t, I wouldn’t write twice as much. I would still want to spend my other time reading, or shooting baskets, whatever it is. Eating chocolate ice cream, whatever it is I do. So that binds me as well.

And then time spent talking to people binds me. So a very good way to come up with new ideas is to talk with smart people, your friends, but they don’t have to be your friends. They could even be your opponents. You talk with smart people. I almost always come away from that with ideas. But it’s pretty time consuming, if only the travel costs, right? Plus you talk with them. And the talk with them is surrounded by dining out, or going to a movie, whatever else. That’s also a binding constraint. So I think it would be really hard for me to write a lot more. Because there’s three main constraints that are all pretty binding all the time.

David Perell (23:35): Do you outline your essays?

Tyler Cowen (23:38): No, I don’t outline anything. Not books, not anything. Just things get written. I don’t know. It seems to me like an excuse not to write when you outline. Maybe somehow my longer, bigger picture narratives would be more coherent or more compelling if I outlined. I don’t know, it’s just frustrating. I want to get to working out the problems. And I don’t feel you can do that well in outlining. How do you know what you think until you write it?

David Perell (24:07): So if you take a book like The Complacent Class, when even just The Complacent Class as the thesis of the book, is that an emergent property of your writing? Or do you start with that idea and then say, “I’m going to write a book about it”?

Tyler Cowen (24:24): I think it’s emergence. So I have this earlier book, The Great Stagnation about a productivity slowdown. But I don’t much explain where it comes from. So I then thought, “Well gee, I should always try to push this a step further.” What might be some sociological roots of this? Not to say sociological are the only roots, but it’s an interesting question. And I then went through all the different things I know, kind of scanned the memory space. Well, what might count here? And did a lot of research, which ones seemed like plausible sociological causes. And as I did the research and writing, some seemed more plausible, others less so. And the stuff that stuck, then that was the book. Worked on it every day. Ended up with the book.

David Perell (25:07): What do you do when your ideas get tangled like an old pair of headphones?

Tyler Cowen (25:14): Just keep on writing and rewriting. So I rewrite a lot of drafts to try to make things clear or maybe more correct. So if I do a book, it will go through more than 10 drafts typically. Obviously not all at once, but any given paragraph will have been wordsmithed more than 10 times. And a lot gets just thrown out. So just like effort and application, I don’t think I know any tricks. I wish I could write better the first time. But I do think my first drafts now are really much better than they were even seven or eight years ago. I’m not sure why. But I felt I went a long time and didn’t make a lot of progress on that. In the last seven or eight years, my first drafts are much better.

David Perell (25:58): What changed?

Tyler Cowen (25:59): I don’t know. I guess I’m just dense. Right? And I worked on it for long enough. And there were more pressures on me to write more. So when I wrote for New York Times, that was a column once a month. That’s not that much. Right? I write now for Bloomberg, which is a better arrangement for me. And it’s two columns a week, which is really quite a bit. So your first drafts had better get better, right? That’s not the only thing. Because I think it happened before Bloomberg. But in part, I wouldn’t have taken on Bloomberg maybe unless I could see that my first drafts would be good enough that yes, those go through a number of drafts. But if those needed 10 drafts, it would be hard to be doing that. A book definitely needs 10 drafts because it has more than one idea.

David Perell (26:44): What makes for a good topic to write about?

Tyler Cowen (25:51): It depends whom you’re asking. It ought to be in the news cycle. And most of what I write on, I try to have in the news cycle. Though it’s maybe only 85% of what I do. Then there are what I call lone wolf topics that no one else is talking about and you want to introduce into the discourse. And by definition, those are not on the news cycle. The topic for a column, 800 words. You just can’t have too many ideas. Most of those columns should have one main idea with support or rebutting objections. But one main idea that can more or less fit into a headline or a subheader. That’s a column. A lot of my writing is not columns, but that’s what makes for a good column. And it should be correct. Right? Or approaching correct, we hope.

David Perell (27:36): Why do you collect so much art? So I’m looking at you now. It looks like you have some Haitian art behind you I believe. What do you get out of collecting art, both from maybe the economic lens, the cultural lens, and then just the pure human satisfaction of it?

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Tyler Cowen (27:50): I think if you’re in a position to do it, it’s one of the most important things a human being can do. First, you are surrounding yourself with beauty every day of your life, at least every day you’re home. And when I’m traveling often, I’m seeing art the places I’m at. So you just make your whole life your whole home, something remarkably special. You learn about other cultures. You learn different points of view. By refining your eye, you develop a skill that is extremely useful for judging other things, and cracking cultural codes, and other settings. It’s an education in market economics, art markets. How do you buy the best pictures in an area, Haitian art, or how do you assemble a very good voodoo flag collection? Or how do you get outsider art Amate painters in Mexico to do their best work for you? That itself is a kind of business problem that you need to solve.

And this idea that you want to experience in solving a broad diversity of problems, heighten your aesthetic sense, learn some real history, understand how some of the art worlds work, surround your life with beauty. To me, that’s pretty phenomenal. And a lot of artist is stratospherically expensive, but the things I’ve bought have not been. I’m not saying it’s cheap in the aggregate. But to me, it’s definitely been worth it. And some of my regrets are not having bought more. I think back pictures I go, there’s a 19 years ago, there’s an Everald Brown Jamaican Naive Art painting I passed up for $3,500 owned by the Thompsons who live in Connecticut. It still bugs me. What a fool I was. If you’re listening Thompsons, please sell it to me. I’m still interested.

David Perell (29:31): Let’s get him that painting! We should start a whole movement around this. So how do you heighten your aesthetic sense?

Tyler Cowen (29:39): Well, you should look at as much art as you can in museums. Visiting private collections is often better than museums, because you see how other people’s eyes have worked and expressed themselves. Talking to artists, talking to collectors, talking to curators, all the obvious things you might do. But just do as much of it as you can. But then buying is the final test. You’re like betting with your own money. Everyone makes a lot of mistakes at first, you’d better learn pretty quickly, or you go broke in a sense. And having real money on the line as in business, as you know, is a highly sobering and edifying experience. Like gee, this better work.

David Perell (30:19): So presumably then the market is some kind of validator of how good your aesthetic sense is. Are you selling art too?

Tyler Cowen (30:28): I don’t typically sell art. There’ve been paintings I’ve regretted, I’m willing to get rid of. I’ve helped people buy art. And I do that by buying myself and then reselling, but it’s not intended as a sale. I’m really just playing a middle man role.

I don’t think you should treat the market as a validator. You should treat the market as something you can improve upon. But of course that’s hard. I don’t think you should buy art to resell it or make a profit. Bid/ask spreads are quite wide. It’s one of the hardest areas to get rich in. A lot of the people who do very well are actually semi-corrupt or are using it for kind of not quite legitimate tax reasons. Maybe it’s barely legal, but not the kind of thing I want to get involved with. And you should buy it for the love of the art. And try to find that which other people have not really found or appreciated yet. And it’s just like the world of ideas, right? It is the world of ideas. It just costs more to play in it in terms of upfront dollar commitments.

David Perell (31:31): So when you’re finding, for example, you lived in, what is it? Northern Mexico for a while. What did that village teach you about art and collecting it?

Tyler Cowen (31:41): That was in the state of Guerrero. The village was called San Agustín Oapan. And I lived with some artists who are doing art for a considerable part of each day. And one of the things I learned from them is just you would buy some works elsewhere and bring it to them, sit down with them, let them criticize it. Tell you what they think. And they are brutal, especially on each other. But that’s part of the fun, part of the learning. And you see what different ways they have of being smart that you can learn from. And these are people who basically can’t do arithmetic, or maybe cannot write beyond writing down their name. They have not gone to much schooling. And how they think about what they do is so different. Those are some of my most memorable experiences were sitting down with these artists. Maybe a family of seven would have an income of two, $3,000 a year. And hearing how they think about things.

David Perell (32:41): What can writers learn in terms of having a more prolific and productive output from artists?

Tyler Cowen (32:50): I think a lot of artists work only occasionally and in bursts. That’s not how I write. Some writers work that way. It seems more common amongst say painters, at least. And I don’t know why the difference is. It’s one thing I’ve always wanted to understand better. But the nature of inspiration, it seems to be lumpier, more convex somehow. So the artist is kind of waiting and then explodes. And again, some writers are like that, right? Proust. At one point, he just wrote Remembrance of Things Past, didn’t do that much before then obviously was dying. Didn’t do anything significant afterwards. Thomas Mann it seems exploded periodically with masterworks, but was not a journalist writing every day. It could be the very greatest talents explode. Cervantes would be another example. Was in prison. He wrote Don Quixote. His other works. I mean, they’re interesting. I wouldn’t say they’re not good, but they’re not really close to Don Quixote.

So it could be the convexification of the highest forms of creativity, something we should learn more from. But I’m pretty sure I’m not the person who will figure that out. I’m too non-convex. Write every day, write a small amount if needed, just keep on going.

Music composition is an interesting area. If you look at Johann Sebastian Bach, I mean, one of the greatest geniuses. It’s pretty clear he was always composing. He was like a lot of these writers. Shakespeare seems pretty actively to have been writing also. And he and Bach, maybe the two greatest geniuses in Western cultural history. They were actually not very lumpy. Picasso also wasn’t lumpy.

David Perell (34:44): Do you think about legacy?

Tyler Cowen (34:47): No. When I’m dead, I’m dead. It’s nice if somehow it’s helped the people I’ve known had better lives. But I’m not at all like, “Will people still read me?” First, I’m pretty sure they won’t. Second, I’m not sure I would care that much if they did. I do care that they read me now though. I’m not saying it doesn’t matter, but I’ve spent a lot of time actually studying the half lives of ideas. And hardly anything happening now will still be right in 20 years’ time, really close to nothing. But if I’ve had influence or produced benefits now, that’s enough for me.

David Perell (35:23): But it really doesn’t matter if the percentage of things that you’ve written that have influenced. You were just talking about Don Quixote. That was the one book that stood out. Doesn’t it matter? It’s much more of a tail distribution.

Tyler Cowen (35:38): Well, but it’s become a tail distribution where hardly anything in nonfiction still gets read. So you take someone like Gary Becker. In his lifetime, I think he was the most cited economist for many years. He could have won five or six Nobel prizes. Helped build an enduring program at University of Chicago. One of the top half dozen Nobel laureates in my opinion, of what is now a pretty large group. He’s not read anymore. So Milton Friedman is barely still read, what is it I should hope for?

I have this debate with Robin Hanson. So Robin really wants people or maybe M’s to read him after he’s gone. The M’s will read him, I’m sure, if that’s what it comes to. But I don’t think the people will. So I say maximize impact now. But most of all, maximize your own learning. Be pretty selfish in that regard at least.

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David Perell (36:33): Henry George was like that too, right?

Tyler Cowen (36:36): Yes. He’s had an amazing impact up to the current day, but he’s not that much read. And his impact probably does not come from him still being read, because he has read very rarely. I actually put on a whole two day seminar to read through Progress and Poverty with a number of people, including Peter Thiel. This was just a phenomenal event. We had a small group. Everyone was totally dedicated to the book, just like sessions all day long. We had some Georgist specialists there, some historians. I had a blast. That was great. But again, one thing I learned is how few people are reading that book.

David Perell (37:16): What have you learned from Peter Thiel’s production function?

Tyler Cowen (37:22): There’s a lot about Peter’s production function I don’t know, first of all. I don’t think of Peter as a tech person. I think of Peter as a humanities person with maybe the deepest understanding of the humanities that is out there now of anyone. Think it’s not an accident that Peter is fairly religious and has embraced thinkers such as Rene Girard. I mean, he has a philosophy major from Stanford and a law degree. That’s a kind of training in the humanities. But you wouldn’t say he’s trained in the humanities in the way that an academic writing in the humanities is. But understanding the humanities side of what is going on in American society right now, he to me has been thinker number one for some time. And I think a deep reading of highly selective set of things, he’s kind of a lumpy thinker. Ideas to him probably come in bursts. And the way he engages with other people in an intense way. You sit down with Peter, it’s for quite a while. You kind of figure this isn’t the setting where you get up to go to the little boy’s room, right? You’re supposed to stick to the talk and learn something. And that’s a very tough audience to have, but it’s phenomenal.

David Perell (38:39): You once told me that he has the best BS detector of anyone you’ve ever spoken with.

Tyler Cowen (38:44): Probably true. He just gets when people are bluffing. And I think some of that comes from his experience in real world companies and on boards, and doing venture capital. He’s probably the best selector of talent America maybe ever, but at least in the last 50 years has seen. And for that, you need I think a pretty phenomenally deep understanding of things that at least correlate with the humanities. Something like how good a programmer is Peter, I have no idea whatsoever. I couldn’t tell you. No idea.

David Perell (39:18): So what do you think Peter knows about studying the humanities that the rest of us don’t know? If I were to look at the progress, at least the explicit progress in studying computer science, it’s gone up way faster than the progress of how good we are at teaching humanities. What does he know?

Tyler Cowen (39:34): I think it’s how seriously he takes it, first of all. That he has what I would call a deeply moral perspective, which is discouraged in a lot of academic research. It is moralizing in some kind of backdoor almost sniveling way actually. But Peter upfront I think would present his thought as an attempt to moralize and to get morals right. Taking religion seriously, taking the West seriously. Being open to ideas from a broad range of sources. Being super smart and having all this real world experience with companies. And I think also being bicultural and bilingual gives him a huge edge. And that is not remarked upon enough. Peter was born in Germany, is fluent in German, obviously fluent in English. And that from the very beginning gives him at least two ways of looking at things.


How Tyler reads

David Perell (40:22): So you’re talking about Peter’s intensity. And I presume that you’ve borrowed some of that. Let’s move into your reading. How do you read, and how do you make that reading experience intense? One of the advantages that you have is you can just read way faster than other people. So maybe start there. What is it about the way that you read, the way that you process information? And then let’s move into, what are some of the things that you actually do in your reading?

Tyler Cowen (40:47): Well, reading fast is one of my core advantages. Maybe the core advantage, to get back to your very early question. And that I’m pretty sure I was born with. I think I’m a hyperlexic. There’s a technical term for it. My mother used to always tell me that when I was two years old, I just sat down and taught myself how to read. And I looked over the shoulder of my grandmother when she was teaching my slightly older sister how to read, and just learned how to read. And at the time my mother said this, I’d kind of roll my eyes. “Yeah mom and whatever. And I could have been a pro baseball player.” But you go out, you read some literature. And it turns out there’s such a thing of young kids often at the age of two who can do that. It’s fairly rare. But I now definitely believe I had it.

So even a comparably well educated or whatever person you might take to be my peer, probably I can read five to 10 times faster than they can. And people used to always say, “You don’t understand it. You don’t absorb it.” But after I’ve done 100, this is now low status Tyler coming out. I’ve done now more than 100 of these podcasts. And no one ever says anymore I don’t understand what I read. Those are in real time, they’re live. I’m dealing with the writings of all these people and all background literatures. And people get that I get it in a pretty deep way. So people have stopped doubting that I understand what I read since I’ve done podcasting. That’s my boast for this podcast.

David Perell (42:15): Yeah. My favorite podcast is the Knausgård. And I think that that’s a good example here because he is Norwegian, I believe. So how did you prepare for that?

Tyler Cowen (42:25): Well, I already know a lot about Norwegian literature, history, and culture. That’s just obviously something I would have done some time ago. Right?

David Perell (42:33): Okay. But why is that obvious?

Tyler Cowen (42:35): Norway is a major country. It’s one of the world’s most successful countries. Ibsen is a major figure. I wouldn’t call Grieg a major composer. But you ought to know even his second tier piano works if you’re serious about anything at all. Right? And then Edvard Munch, the Norwegian painter. Well I’ve been to the Munch Museum. I’ve made a point earlier in life of seeing several shows of Munch paintings, Munch prints. Read probably two biographies of Munch. So I didn’t have a strong background in his work, but I knew something about it. And then here comes Knausgård with a new book out about Edward Munch? So I’m like, “Gee, I kind of know this stuff.” So I re-read or read some of the new works, read his book carefully. Reread a lot of Knausgård of course.

His sources like Knut Hamsun. There was a lot of late Knut Hamsun I’d never read. I had read Hunger like everyone else. But the late autobiography, which to me is Hamsun’s most interesting work because he’s trying to rationalize having been a Nazi. And he was super smart. Kind of an evil guy, right? Not kind of, an evil guy. So that I went through and knew, and found fascinating. And that was one of the favorite perhaps I’ve done for anyone. Just to kind of retake in Norway yet again. And having been there an extra time in the meantime as well, I’ve been to Norway three times. I love those trips. I love the country.

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David Perell (44:00): So when you prep, what do you do? Do you read every single thing that that person has written? How do you read about them? What do you do? Do you talk to people?

Tyler Cowen (44:13): It depends on the person. So for Knausgård, I’ve read almost everything he’s written. Volumes four and five, I couldn’t bring myself to read all of. So that’s a failing. But I didn’t think they were very good. So I’m just not going to ask him about those. And otherwise, at least what he wrote in English, I believe I’ve read all of it. And in fact, his first book before My Struggle, I was one of the first two or three people to push it and say, “He’s a great writer.” That was this book about angels. You can still find it in the archives. Before Knausgård was Knausgård, I was saying this is great. Knausgård was once a commentator on Marginal Revolution. So I have some ties to him and how he thinks. So read all of it, reread, read about him. Just kind of track down influences. So I reread some Strindberg, Ibsen. The Knut Hamsun, including some of the new reading, just to get into his mindset.

But you can’t do that for everyone. So Margaret Atwood, she’s never had a university post. She’s had to write for money. I forget the number for novels, but it’s over 40. I haven’t read all 40. I’m sure I haven’t read 20 of them. Probably I’ve read 15, the important ones. And I enjoy doing that, but you can’t read all of Margaret Atwood with the time horizon I had. And I read a lot of her essays, read maybe a quarter of her poetry, certainly not all of it. But again, that’s enough. She’s a very steady writer as I am. And just knowing that was a big help.

David Perell (45:44): Coming back to your competitive advantage, it seems like what I’m hearing is that you understand culture better than other analytical thinkers, and you understand analytics and how to think statistically and mathematically better than other cultural thinkers.

Tyler Cowen (46:02): It’s probably true, but I would stress there’s really not any field where I’m smarter than the people who are really smart in that field or that method of thought. There’s some kind of bridge building I can do that is scarce. But like in any particular area, I’m really backward compared to the very most skilled, talented people. But I recognize that, and I’ve known it for a long time. I’ve built kind of my whole career and modes of doing around knowing these other people are smarter than I am. And again, that’s a kind of smarts too. I get that, if I’m allowed to boast again.

David Perell (46:37): You are.

Tyler Cowen (46:39): But it’s not the same as actually being good at figuring out how to work the microwave oven. Right? I’m terrible at that.

David Perell (46:46): Why is that so hard?

Tyler Cowen (46:47): I just see a screen. I’m not used to the order and none of it makes sense. And I reheat things on the stove. It’s easier for me.

David Perell (46:55): Well, it’s the same thing with your website, right? Don’t you just follow the same directions for posting a blog every single day and you just follow the directions, but you don’t really understand how it works?

Tyler Cowen (47:06): And I get upset when they make small changes to the software. That’s right. Like how to add a link. It’s a little different than how it was 13 years ago. I mean, I’ve gotten used to it. But I’m never happy when they improve my Gmail or whatever else they might be trying to do. It’s almost always a negative for me.

David Perell (47:25): So then we should be complacent with your software?

Tyler Cowen (47:28): Well I don’t doubt that over, very long time horizons, the stuff is better. Microsoft Word is better than WordStar, which is what I wrote my first pieces in. And I’m glad that shift has been made. But it’s kind of intransitivity of difference. There’s no step along the way when I was happy. And some of the steps, some of the intermediate operating systems from Microsoft have been worse, right? It’s not just my view. Some of them are actually worse. And a lot of the better ones, it just doesn’t seem worth it to me.


Evaluating talent

David Perell (48:00): With Knausgård, you said that in his first book, before My Struggle, you knew that he was going to be a good writer then. And now, a lot of our recent conversations have been about evaluating talent. What is it about evaluating talent that you know that other people should learn from you?

Tyler Cowen (48:20): My next book is coauthored with Daniel Gross, the venture capitalist. And it is on exactly this question. And I have a policy never to give books away until they’re coming out. So I will refuse to answer that question. Maybe one or two specific questions about talent I would answer. But for now, I will pass on that. But whatever Daniel and I know about talent and talent finding and are able to put into words, we are putting into that book. And right now it is 73,093 words I believe that have been written. So I wouldn’t call it done, but it’s not just a gleam in our eye. It exists.

David Perell (49:01): Okay. Two questions then. They’ll be super specific. It seems to me that you’re taking advantage of some kind of arbitrage in that what happened was in the same way that we didn’t have the ability to understand what drivers were available with taxis. And now we know where all the cars are with Uber. I feel like there’s a similar kind of legibility that’s been created with talent in that the average person had nothing better than a resume. And now they’re writing blogs, they’re making videos. Like our friend Craig Palsson, he has Market Power. So what you’re doing is you’re taking these new signals of legibility and making bets. So you have eyes where other people don’t.

Tyler Cowen (49:46): I’m very bullish on Craig Palsson. That’s P-A-L-S-S-O-N if you want to Google him. @Marketpower I think on Twitter. And what I see in him is just really wanting to be out there, and a determination, and a focus. And just really caring about getting things right or expressing things a certain way. And that is one of his priorities.


Content Spotlight – Craig Palsson:


When I met you, this emphasis on writing to me is very commonly a big plus for thinking people will do well at something. It’s a sign of clear thinking. And there was also a sense in which I felt you could take your sports background and learn from that for other things you had done. And that you really wanted to be doing something that would meet your curiosity, but also help you to succeed and were really keen on focusing on doing that. Was why I became bullish on you.

David Perell (50:39): Thank you.

Tyler Cowen (50:40): Does that make sense to you as a description of you?

David Perell (50:44): I think it does. I mean, I think that one of the things that you’ve said that I thought was spot on. I’m not very good at a lot of things. But if there’s one thing I’m good at, I’m good at taking action. And I think that for me, my competitive advantage is just being able to take a lot of action really fast and just to ruthlessly improve at things. And I think that you sensed that at some point.

Tyler Cowen (51:10): Yeah. You’re metarational about that. You can easily see, “I’m not good at XYZ. I need to hire someone or my line of business just won’t cover that. Here’s what I’m good at. Let’s structure what I do around that.” In that sense, you reminded me of myself. And I think highly successful people tend to have that. A ruthless honesty. Like what am I really good at or not.

David Perell (51:31): Thank you. Out of the Emergent Ventures winners or grant recipients, how many have an online presence like a blog or make videos?

Tyler Cowen (51:46): Most of them, offhand to give you a percentage, I would guess at 80. But it’s tricky because the ones who are online, I see their names more often. Maybe I’m overestimating them slightly. But then we have even some anonymous winners who are not online at all, and have had quite a big impact doing things, say in the so-called real world. Sometimes even in the world of policy. And they’re really important, but they’ll never be the visible winners.

David Perell (52:14): So then, it does sort of prove my thesis. That what you’re doing is you’re taking writing online and publishing as a proxy for some kind of ambition, intelligence, drive, clear thinking, motivation. And you’re betting on those people.


CONTENT SPOTLIGHT PARADOX OF AMBITION

  • The larger your ambitions, the easier they are to accomplish.
  • Moments of tremendous progress often come down to the quality of a first impression.  
  • Showcase your ambition by writing online, and you’ll attract big supporters.

    If you liked this section, you’ll enjoy my essay on the paradox of ambition.  


Tyler Cowen (52:29): Mostly, I would agree. But I would just stress how much the writing and the proposal matters to me. So how good the proposal is, is really very important. So when I interview someone for the first time, most of the time, I don’t track them down using Google and try to read whatever. Their Medium essays or their tweets. I want to approach them fresh, have a Skype chat with them. But I’ve definitely read their application and thought, “How well is this written? How clearly is this explained?”

But by not tracking down the past stuff, just like I don’t ask for CV. Don’t ask for letters of reference. Trying to give everyone a fresh start in a way. But like okay, here I am, show me something.

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Tyler’s quirks

David Perell (53:15): What is the quirkiest thing about you that people don’t know?

Tyler Cowen (53:20): I don’t know. I mean if you blog for 17 years, do these podcasts, other things, people know an awful lot. The quirkiest thing about me. I think my quirks are pretty evident.

David Perell (53:31): I’ll give an answer. You always have the same tote bag from the same London bookstore, and you don’t even hold it normally. You throw it over your back and then you hold it like this, and your arm must get tired.

Tyler Cowen (53:44): Well, that’s a good answer. But I kind of assume a lot of people know that because I carry the tote bag. It’s from Daunt Books by the way, my favorite bookshop in the world, in London. The branch on Marylebone Street. I highly recommend it. They have these wonderful bags. If you buy enough books, they’ll give you one for free. You can buy others at the margin. The dark bags are the best. I carry around an iPad and some books in the bag pretty much always.

David Perell (54:09): How many wool sweaters do you own?

Tyler Cowen (54:11): It’s a good question. Over 10. To me, they’re comfortable. I like the [inaudible 00:54:19] patterns. I like the dark colors. Obviously, I’m not wearing them now because it’s summer and there’s nowhere to go. But again, that’s a quirk about me I kind of assume people already know.

David Perell (54:29): How when you’re with people, you say that you learn a lot from conversation? How do you choose restaurants that will lead to good conversations?

Tyler Cowen (54:39): Well, the best thing to do if you can, is to be in the suburbs, right? It will be much quieter, and no one will rush you out the door. And then you want to pick an ethnic restaurant, because they’re used to people staying longer. Their business model usually is not to turn over tables. Very often, the business model involves catering for weddings or auxiliary services. And you can just stay there. One hopes the music is not too loud. And then just camp out an order some things.

Now you’re in New York City. It’s harder to do. You’re in San Francisco. That’s harder to do. But even in those urban areas, there are different corners where that’s relatively easier compared to say being on Fifth Avenue and trying to sit down, which is bad news.


The art of interviewing based on more than 100 Conversations with Tyler

David Perell (55:23): Having done more than 100 Conversations with Tyler episodes, coach me. What makes a good interview question?

Tyler Cowen (55:32): I would just say first, all of this episode. You know how they have those warning signs on videos like children do not try this at home? Everything I’m saying that applies to. None of it is suggesting other people could or should do the same. And I think my interviewing style for Conversations with Tyler is pretty different from other interviewing styles. I do think it works. Probably wouldn’t work for most people. You really have to have read an awful lot for it to work for you.

I don’t probe on a lot of matters. I think when you probe, people repeat a lot, and they also get defensive for your next question. So I ask a series of questions all highly specific. I try that they’re never hostile, never perceived as hostile. But super conceptual and just really hard to answer. So to get the guest into the serious intellectual substantive mindset as soon as possible. No real introduction, none of this, “Well, first I’m going to summarize the work so all the listeners know what we’re talking about.” Like no way. I mean, this is not here for the listeners, right? You just want to start in on the question you want to ask them. And people will figure it out as you go along. But to make that work, you need to have captured in your head a very, very large body of material. And if you can do that great. But the kind of normal style, which I hate. “Well tell us what your new book says.” To me, that’s like death. And it deadens almost any author who’s already done it a few dozen times or more. You just want to start on the substance and dig right in.

David Perell (57:07): Yeah. It’s as if you’ve picked up on a weird paradox of the internet. Because you say this is the conversation I want to have, not the one that you want to have. And in some way, not thinking about other people actually has you making better quality of work.

Tyler Cowen (57:23): Sure. And that’s a Straussian comment too. The one I want to have, not the one you want to have. I mean, there’s a lot buried in there, right? Maybe the one I want to have is to talk about some other people. I don’t mean their work, gossip about other people. But we don’t do that in the podcast. That’s fine. It wouldn’t be really appropriate, but it might be what I want to have. So in a way I’m announcing it’s not exactly what I want to have

David Perell (57:53): Charlie Songhurst when you introduced me to him, you said, “This is one of the smartest guys I’ve ever met.” He says that people either want money, power, or fame. Where do you fall in that Venn diagram?

Tyler Cowen (58:05): You know, I wrote Charlie. I don’t think that’s really the correct division of motives. And also once should add missing from the tripartite structure is love. I’m not sure that’s the right way to express it either. But if you’re just going to play the gross concepts game, it’s got to be at least four. Maybe immortality beats them all.

I just think I have a nature, a kind of temperament way I think. And it’s built into me pretty deeply. And I want to do that. I’m not sure which of his structure that falls under. And to do that for me is really fun. It’s earned me decent money. I’m not a rich person, but I’m comfortably well off. I wouldn’t say it’s earned me fame, but some recognition. So there’s some kind of co-movement there. And I just keep on doing it. I don’t know. I don’t have a plan really. Maybe I’m just trying to get through the next 15 minutes.

David Perell (59:02): Well, you have some kind of famous where people know you. And I think that people who you want to know you, you know. And that there’s a way that you could think of you as some kind of Bismarck in that you know a lot of very high power, high status, wealthy people. And you have very strong relationships with them, and you have influence. If that’s true, why don’t you recommend that more?

Tyler Cowen (59:28): Well, I think what you need to do to have my version of that is so extreme and requires such specialized skills. I don’t want to talk someone out of it if they think they can do it. But most people should be finding their own paths, not mine. So again, children, don’t perform the stunt at home with the motorcycle over the flaming barrels of oil or whatever. Trying to copy. I don’t know that there’s any one person I tried to copy. I’m pretty sure not. So if you want to copy me, don’t copy me.


Tyler’s thoughts on teaching

David Perell (1:00:03): How have you practiced getting better at teaching?

Tyler Cowen (1:00:08): Just by teaching a lot. I don’t find student evaluations that helpful. Mine have typically been very, very good, which I don’t equate with doing a good job. But look, it beats them being very bad, right? I think to some extent you get good evaluations just by being a predictable grader. And I think I’m a predictable grader. But I don’t confuse that with being a good teacher. I think I’m an entertaining lecturer, which is important and inspires people. But again, it’s not exactly the same as being a very good teacher.

I think there’s a whole bunch of detailed things that some students hope to learn in the classroom that I’m actually bad at providing. And I’m kind of a very good teacher in a specialized, inspirational way. You want to get a dose of how Tyler Cowen thinks? There’ll be this kind of 2 hour 37 minute lecture. If you’re lucky or unlucky, a short break in the middle. Sort of the first five minutes are prepared, then it’s improvised. But it’s very substantive and actually quite well ordered. Kind of a Blitzkrieg at you in all directions. And it’s super fun. For that, I think I’m really good. But I don’t think education should be any more than 10 or 15% that either. Going through a model in class, I don’t think I’m that good at. And I’m worse at it than when I was first teaching in my twenties.

David Perell (1:01:29): Have you tried to become more entertaining over time? Do you say if I’m being funny, that’s a good thing. Anything like that?

Tyler Cowen (1:01:37): No, that’s terrible. In fact, I’ve almost tried not to be funny. And my funniest stuff, I don’t even know is funny. I’ll say things, people like, “You have this great deadpan sense of humor.” I mean, I guess I do if you say so, but I’m shocked when people laugh. Trying to be funny is poison for being funny, at least for me. And I’m never really trying to be funny.

David Perell (1:02:00): And somehow this is funny now. Is it worth teachers spending more time reading studies on how to teach better, or is teaching such a tacit skill that you just need to do more of it to get better?

Tyler Cowen (1:02:15): I don’t know. I think for people who are teaching at the graduate level in research universities, probably to read how to teach better is a waste of time. And they just need to teach a lot and maybe teach diverse groups. But if you’re just talking about your 38th percentile quality junior high school teacher in a mediocre district. For them to just read kind of a stupid bland treatment and copy the stupid bland advice. I’m not sure, but I suspect that’s probably pretty good. And it could be a reasonable improvement.

I would say one other thing that’s helped my teaching is just teaching such diverse groups. I started teaching when I was 19. I taught high school students. I had a barnstorming job flying across the country to weird American midsize towns like Manhattan, Kansas, or Grand Rapids, Michigan. And teaching high school debaters how to use economics to think about the debate topic. But I’ve taught in dozens of countries, all the different continents, places, old people, young people, educated people, not educated people. I’ve given lectures on the history of piano music, the arts, many different areas to many different kinds of groups. And I think that’s helped my teaching a lot.

David Perell (1:03:33): You speak some Spanish and some German. How do those languages help you access different ideas?

Tyler Cowen (1:03:41): Well of course you can read in those languages. That’s less important than it used to be. And you can talk to people who don’t speak English. That’s still very important. It seems less important than it used to be, but I’m not sure that it is. Because the people who have a native tongue of German or Spanish who come to speak English, they’re a very select group. Less so with German. But nonetheless. But even then, if I meet someone whose first language is German, I don’t feel I know them till I’ve heard them speak German. And I sense that intuition is basically correct. There’s an English language version of them, a German language version, or a Swiss German version, whatever. That’s the real version. And if I don’t know that, I’m just marking time. And of course for most languages, I’ll never know that. Like Russian I don’t understand. But I hear so much of it. If I hear someone in Russian, it’s like I feel I know them, even if I don’t know the words. Because I know different Russian ways of talking or something.

So to me that’s super valuable. And from reading in German, Spanish, you get different perspectives, insights from different cultures. But they’re not so distant that you can’t absorb them. If I were fluent in Mongolian, I don’t know how that would be. It might be less valuable to me, because Mongolian is very distant from what I grew up with.


The value of travel

David Perell (1:05:01): Assume a normal state of the world. If I told you that tomorrow I would pay for a flight and you could go to Mongolia, you could go for 10 hours, but you’d have a very local experience. You would learn something. But you’d have to deal with the sleepiness, the hassle, the inefficiency of it all. I feel like you would at least consider that and entertain that idea in a way other people wouldn’t.

Tyler Cowen (1:05:25): I’d do it in a heartbeat. There’s no consider. What kind of word is this? Those 10 hours would be so vivid, the food would be so interesting. Just seeing how people relate to each other. Hearing the sounds of their village or city, wherever you would send me. My goodness, what a thrill to remember your whole life. Mongolia, wow. I used to be a kid. I’d sprawl out these books with maps on floor. I’d look at different countries. They were barely real places to me until I go to one.

David Perell (1:05:53): So what’s behind that? So there’s got to be some learning element. Walk me through that. Because I don’t think I would do it for 10 hours. No way.

Tyler Cowen (1:06:03): I bet you would. First, have you ever tried it?

David Perell: No.

Tyler Cowen (1:06:08): Well once COVID is over, you need to try it. Maybe even we’ll have the chance to try it together. But in any case, try it. Like I’ve tried alcohol, right? You might decide it’s not for you. But if it is, my goodness. Whole new worlds are opened up, right? And most places are closer than Mongolia. The only argument against Mongolia is the Caribbean is only a few hours away. You’re in San Francisco. You’re further from most things. But still a lot is close to you right now or when you were in New York. So the only case against Mongolia is simply you can do the same 10 hours with a shorter flight, like in Belize, or Honduras, whatever you want to do.

David Perell (1:06:50): So then it’s some kind of appreciation for novelty that you have. That’s what I’m hearing.

Tyler Cowen (1:06:54): And there’s an excitement to just my goodness, I am here. And taking in the new sounds, sights, sensations. That it’s imprinted on your memory. You kind of order it with the other places you’ve been. Maybe you’ll get to hear some music, which on a recording is never the same. Send me somewhere good. I’ll order the right thing from the menu.

David Perell (1:07:17): So you seem to get so much from travel. So what are the rest of us missing about how to travel?

Tyler Cowen (1:07:25): I’m not sure the rest of you are missing that much. So a lot of people love to travel, right? I’m not sure it’s a majority taste like percentage of Americans with a passport I think is pretty low. But even they travel within the U.S., which I’m a big advocate of. I just did a trip to West Virginia, blew my mind. It’s only three days, I went with daughter. And most Americans do that. So I think most people get travel in a basic way as it stands. I have maybe more ambition or somewhat more material resources. I’ve trained my body to take travel very well. I get a bit of jet lag, but I really adapt to travel quite well. Don’t get sick. I’ve eaten street food all kinds of weird places. Haven’t gotten sick. So I just for maybe accidental reasons have lower cost. But I don’t think I have a grand insight. I just think the more you travel, the richer the picture you can get at a single place. There’s increasing return. I want to keep on going.

David Perell (1:08:23): Tell me about two things. Increasing returns. And let’s talk about that one first.

Tyler Cowen (1:08:30): The very first place I went outside of the United States was Oxford. In England of course. That Oxford, not Mississippi. I certainly enjoyed it. I liked the fish and chips. I was glad I went. My way was paid. I didn’t love it actually. I didn’t really get Oxford. Some of this old stuff and some of it’s run down. I came back home. I still didn’t love travel. It’s not till I saw a larger number of places that it all clicked for me. And maybe that’s how it is for a lot of people.

Then a bit after the Oxford trip, I moved to Germany for a year. Drove or took trains to most of the countries near Germany, which of course is a lot of countries. Then it’s like oh my God, this is amazing. Even just different parts of Germany. All of a sudden you have a filing system.

David Perell (1:09:22): When you travel, if I had a binary. You either speak the language, or you don’t. So if you went to a country where you didn’t speak the language, how would you travel differently to still extract a lot of the cultural knowledge out of your experience?

Tyler Cowen (1:09:39): Well it’s much worse, right? So I don’t think there’s a way you can make up for that. The people there speaking English might help, but that can be a trap of its own. But some of the best experiences are just when you don’t speak, they don’t speak. And you’re just out there, you’ve got to make signs, gestures, just interact with people directly, physically. You’re in the restaurant, you imitate a chicken or something if you want to eat chicken. It’s inferior in some ways. But you’re forced also to have more direct, more visceral interactions.

David Perell (1:10:13): You said that you trained yourself to not get jet lag. How’d you do that?

Tyler Cowen (1:10:20): I’m not sure if this is what worked, but I’ll tell you what I tried. And it felt like it worked. I just started saying to myself I don’t get jet lag. So when I flew to Oxford when I was I think 17, I had really bad jet lag. Even though I was physically as strong as I was ever going to be in life.

I’m still healthy, but I hardly get much jet lag now. I think there’s a nocebo effect that when people, “Jet lag, jet lag. And I’m going to take this pill, and I’m going to do this, and here’s my neck rest.” I don’t know. You’re making jet lag a more vivid thing for you. Just forget about jet lag. I don’t really get it. And I got less of it. I can’t prove causally that was effective, but I would maybe at least try that one out. If there’s one of these are going to try at home, I would say it’s try my jet lag trick. Just tell yourself you don’t get it.

David Perell (1:11:13): You’ve said that you have an underlying philosophy for Marginal Revolution as a belief in excellence. How do you yourself strive towards excellence and how do you do it in a way where you can be self critical-without being self-loathing or ever getting mad at yourself if you don’t achieve something?

Tyler Cowen (1:11:29): That’s a hard question to answer. I mean, I don’t know that I’m the one to judge excellence of anything I do. In general, especially if you’re a writer, but in general you just ought to hang out with people who are willing to criticize you. That gets harder as you get older and more successful. You have to take more extreme steps. But I would say those steps are worth taking. Hang out with some very critical people and hope you can get the benefits of that. But it’s a hard problem. I think it’s an underrated problem.

And then if you’re with people who are kind of above you in the status hierarchy, you should still be critical when it’s called for. That’s hard to do as well, but stick to that.

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David Perell (1:12:19): So take somebody who you are close to, who is certainly excellent. What can we learn, or what have you learned from Patrick Collison‘s production function?

Tyler Cowen (1:12:29): Patrick is the person I know who learns new ideas the most quickly by an order of magnitude. So he can take anything, study it, and pretty quickly he has a good understanding. And then a bit after that, he has a very good understanding. And then it can be a technical issue in macroeconomics. After he thought about it for a bit or read a bit more, he has a phenomenally good understanding. So that’s I think the area where he is just close to being number one in the world. But certainly of anyone I know. And I think that the course of Stripe in some ways reflects that. Learning a new area quickly is his phenomenal strength, where I haven’t really even seen anyone close to him on that.

David Perell (1:13:12): Do you have a sense for what he does? Maybe he’s really good at asking questions, picking books, focusing.

Tyler Cowen (1:13:17): Well, he’s good at all those things. Sure. But at the end of the day, that doesn’t explain it. So probably there’s some strong inborn element. And then he’s recognized that’s what he’s good at. And then the execution is very high quality. And it all fits together.


Studying music

David Perell (1:13:31): When you and I go to jazz concerts at the Village Vanguard, why do you insist on showing up 35 minutes early and sitting in the front row?

Tyler Cowen (1:13:40): Well, you see much better in the front row. The best row for hearing is maybe three rows back. Not the very front row. The very front row can be a little oppressive depending who’s playing. But to see how they play, you understand the music much better. And in that conceptual understanding sense, the hearing of the music is best in the front row. Even if though, if you could, you might substitute in third row sound into the experience. To see how the guitarist is moving his or her fingers on the frets, how the pianist is playing, how the people in the group look at each other. Such a fresh new way of understanding the music you’re hearing.

David Perell (1:14:17): What do you get out of it?

Tyler Cowen (1:14:21): I learn a great deal about music. And if you see the right people, it’s fun. Now you go to the Village Vanguard. I would say you can go almost any night randomly and you see something excellent or world class. Maybe even every night. It’s like Museum of Modern Art in New York. It’s just so, so good that if you know enough to appreciate, everything they do is just very, very good. And I will go to the Village Vanguard literally just randomly. Like, “I’m in New York. It’s Thursday night.” I don’t really even need to check who’s playing. I’m just going to go. It’s like MoMA. You don’t have to check which exhibits are on. I mean, you might for pleasure of anticipation, but you can just go.

David Perell (1:15:04): How have you gone about improving your musical knowledge? It doesn’t seem like you can pick it up and read it in a book. It seems like live experience, talking to musicians, maybe playing music yourself. What have you done?

Tyler Cowen (1:15:16): When I was young in my early teens, I played guitar for seven years. And I studied music theory. I studied jazz, some amount of rock. I studied classic blues. I studied ragtime. I studied American show tunes, that history, sort of had chord changes worked. Not in a very deep way. And look, I was a kid, but seven years of something you take a lot in. I wouldn’t say I could ever play the piano, but I spent time on the piano, and figured out how it worked, and would play tunes on the piano in a simple way. And then just have gone to large numbers of concerts and read as much on music as I possibly could. I’m interviewing Alex Ross New Yorker writer. He has a new book coming out on Richard Wagner. And that’s going to be about music. Not only, but mainly. I’ll be very ready for that. And I studied classical guitar also. I forgot to mention that. Like the works of Bach on guitar, like The Cello Suites transcribed for guitar. I could play the first Cello Suite. Not well, but I could play the notes and figure out how things worked.

So when I listen to those Cello Suites now, especially one three of six, the D minor suite. Doesn’t really work so well on guitar, but I just get it in a better deeper way. And then that helps me entry points into other music. And if I’m ever old and retired, which is probably not ever going to happen. But to study Indian classical music I can well imagine doing.

David Perell (1:16:45): You’re like a golfer. The great thing about golf is you can play forever. The great thing about your work is you can do it forever.

Tyler Cowen: Yes. I hope.


Learning like an athlete


Content Spotlight – Learn Like an Athlete:

If you enjoy this section, make sure to check out my essay on how knowledge workers should train like athletes.


David Perell (1:16:55): Meta question. Why don’t knowledge workers as a class take improving their skills as seriously as we’re implying here? And as you and I have discussed, they don’t have the same rigor as a LeBron James or an athlete.

Tyler Cowen (1:17:11): Well, some of it’s the fault of the market. So we’re highly imperfect at talent spotting. You could do things to improve yourself. And I’m not sure in every case there would be a return there because the market might fail to recognize you. One of the reasons Daniel and I wrote this talent book is we want to help fix that market failure. Make the market better at spotting these signals of quality. And then in turn, more people will invest.

I think also, you need a somewhat longer time horizon, which not everyone has. I wouldn’t quite say you need discipline. It can be a form of irresponsibility just to work on improving your talent. Like maybe when I was 11, I should have been doing my schoolwork and not learning chess. Ex-post, no. But in a way, I wasn’t being disciplined. I was being the opposite of disciplined. And I suspect your history of some of the same. So what discipline or conscientiousness even means I think is more ambiguous than we’re used to realizing.

David Perell (1:18:07): So how do you know if what you’re doing now is working on something productively and all that unstructured time that you were talking about?

Tyler Cowen (1:18:15): I don’t, I really don’t. And I don’t assume that it is productive or the right thing to do. There’s just some compulsion in me to figure out ideas about the next topic, which right now is evaluating talent. And it will bug me till I’ve figured it out as well as I can for the time being. So Daniel and I are doing this.

David Perell (1:18:35): Last time we ate together, we were talking about the rice. And you said that the first rice was better than the second rice because it was fluffier. But both rices were so fluffy that they indicated a kind of level and care to that rice that wasn’t reflective of the $12 dish that it was. What are the secrets of cooking good rice?

Tyler Cowen (1:18:58): Well, some people would say the best secret is to get a good rice cooker. But I’ve never done that. So understanding what kind of rice you want with your meal and why. Rice for French food, rice for Indian food, rice for Chinese food, Korean, Japanese, they’re all quite different. So that you can start learning through books and start learning just by noticing the rice you’re eating at good places. And then you try to do it and just experiment a lot.

So I’m super kind of paranoid, am I using the right rice for this dish? I’m not saying I always get it right. But I always think about it. A lot of dishes I’ll prefer Thai Jasmine rice. But for some, it’s not long grain enough. But Thai Jasmine rice retains moisture in a way that Basmati rice doesn’t. So for most Chinese dishes, I actually prefer the Thai rice to a Chinese rice. Whether that’s correct, you can debate. But it’s like a clear conscious preference from me.

David Perell (1:19:59): But you have some kind of food memory that I certainly don’t have, and I think surprises people. Because when you and I went out for Indonesian food in Soho, you were talking about all the times that you had had those same dishes in Indonesia. And I think our waitress was just shocked.

Tyler Cowen (1:20:15): And that was from 1992, right?

David Perell: Yeah, exactly.

Tyler Cowen: Yeah.

David Perell (1:20:19): What’s going on there?

Tyler Cowen (1:20:20): Well, it’s like travel. The more you know, the more you can order things into a coherent set of thoughts. And if you can’t order them, it’s like the microwave. Just a buzzing blur of confusion. I don’t know what to do here. But the more countries you’ve been, the more sense Mongolia might make for you, not that you understand it, but you kind of what your questions are much better. And same is true with food. I’m starting from a high knowledge base. I have eaten food in probably 100 countries, maybe more.

David Perell (1:20:49): How in the world do you respond to emails so fast and still get what you want to do done?

Tyler Cowen (1:20:57): My only answer is a trivial one, simply that I do it. There’s a lot of things I don’t do. So I hardly ever watch TV. Right now, there is a good show called Counterpart I’m enjoying. Watch it with my wife. But most of the time I’m watching zero TV. I love The Sopranos. I loved Curb Your Enthusiasm, but mostly zero TV. My social life is the same as my ideas life, 90%. So I don’t just sit down and shoot the bull. People may or may not consider that a sacrifice. I don’t, but some people would. So social life is sort of geared toward learning, being curious, exploring ideas, no TV. You end up with a lot of time, and I can work on planes.

David Perell (1:21:44): Why when you respond to email on your iPad, why do you open up the browser for Gmail instead of opening up the Gmail app?

Tyler Cowen (1:21:52): I don’t like apps. They’re like microwave ovens. They’re just like new worlds with the potential to confuse me. I hardly ever use apps. I finally got pushed into the Twitter app by Twitter. And it’s fine. I’m used to it. It’s like being pushed into Microsoft word from WordStar. I use the Uber app. I don’t know how to switch location or do it for two stops. I’m slightly terrified every time I press the button. The fewer apps I can use, the better. Internet to me is home.

David Perell (1:22:22): But don’t you get yourself in some kind of negative cycle where you have all these people who email you, then you respond. And then more people email you. And then you’re going to end up in this escape velocity of everybody emailing Tyler. And in some way, isn’t email sort of a low leverage use of your time in that you could write 100 words an email? One person sees that you could write 100 words on Marginal Revolution, a million people see it.

Tyler Cowen (1:22:47): Well I don’t know, is it a trap? If everyone emails me, I learn all this stuff. I’m sufficiently weird that it’s almost always very smart people who email me. The really nutty stuff tends to be handwritten letters about the national debt or how to drive interest rates to zero, which by the way we figured out on our own.

So it doesn’t feel like a trap. I don’t care if it’s not very leveraged. I’m not even sure it’s not highly leveraged. I met Patrick Collison because he emailed me. I wrote him back. I didn’t know he was Patrick Collison at the time. He was just some guys. I was like, “This guy seems smart.” So A, I don’t know that it’s not highly leveraged. And B, I don’t care if I’m learning. It’s like conversation I want to have, not the one you want me to have.

David Perell (1:22:30): Fair. But take the opportunity cost of you could spend five minutes reading my misspelled, typo-riddled email, or five minutes reading Shakespeare. Wouldn’t the Shakespeare be much better than reading my email?

Tyler Cowen (1:23:44): The Shakespeares I love. Which is most, but not all of them. I’ve already read five, six, maybe even seven, eight, nine times. So I don’t know. I’ll read the email. In the ’90s, when email was still pretty new, I emailed Roger McGuinn, the guy who was star The Byrds. And he emailed me back. That was such a thrill. I love that. Made such an impression on me. And he answered my question. I just thought that was a good way to be. And if it’s a good way to be, I should be it. I hope I can be it for as long as possible. It may become unworkable at some margin. But I thought Roger McGuinn was great. He answered my question. You’re like a kid in the old days for email. You write someone a letter. If they could write you back, shouldn’t they? You wrote them a letter. I don’t know. It seems kind of polite to me, and civil. Who knows who could be emailing you? I once said jokingly, but seriously, answering email is my business model. And I think it’s how I end up well plugged in.

David Perell (1:24:48): Yeah, but you’re not quite hitting on what you do. I emailed you one time with a 15,000 word essay that I had just published. And I had emailed a bunch of people. And you responded faster, 15,000 words. You responded within two hours with a list of 12, 13 questions of, “I didn’t quite like this. This thing didn’t quite make sense. This was really good.” And then I went back and fixed these things, and this is one of the most popular essays I’ve ever written. And I still have never gotten a response as detailed and as thorough as yours. And I’m just like, how do you do this?

Tyler Cowen (1:25:24): Look, it only took me a minute to read your essay. I mean, the constraint was the scrolling probably, not my reading.

David Perell (1:25:32): It was 15,000 words. It was an impressive achievement. Well Tyler, thank you very much.

Tyler Cowen: Thank you, David. It’s been a pleasure.

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