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by lapcat
1332 days ago
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> the more you optimize for revenue generation today, the smaller your long-term resources become. Is this actually true? I know that a lot of people assume it's true, they want to believe it's true, but I'm not sure the empirical evidence supports it. |
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when you earn money today, it comes from somewhere. if you optimize for money acquisition rate, you start pulling from not only different places, but different times.
If I say "screw it" and impulsively buy a new sports car today, I won't have money to buy the much better car I want next year. Today's itch is scratched, and I can report to my family that we have a new car. (I have optimized for the short term.)
Later, I can sell the car I bought today, but I won't get what I paid, and because of that, I can't get the car I had planned on getting, which is not only a much better value, but is perfect for my family and its needs. I take from my bank account in the future to get what I want today. Said another way, I have less in my bank account in a year because I jumped the gun today.
This is what I mean when I say that optimizing for today borrows from the future. Your resources in the future are more limited because you optimized for the short term when you made an important decision. Optimizing for the short term pulls those rewards you are getting from somewhere, and unless you are stealing, you're pull those rewards from your future self.
Optimizing for the longer term can indeed also reward in the short term, and I'm not talking about anything like that. I'm talking about making decisions where your only decision criteria is what you want right now. This is, to me, what Apple's now-suspended decision to allow gambling advertisements REEKED of. It just stank of "we could have more money right now and improve our quarterly numbers if we let people do this" and is classic business optimization of the short-term.