Baumol’s Cost Disease

Baumol’s Cost Disease is a lens. Nothing in the world changes when you pick it up, but quite a lot becomes visible.

Strip it to the floor and you find an old instruction: look carefully, judge slowly, act decently. The new name exists because the old instruction keeps being forgotten.

The idea is simple, and like most simple ideas it is easy to nod at and hard to use. The nod is free. The use costs attention, every day, in small change.

Watch two shopkeepers in the same lane during a lean month. One cuts quality, the other cuts margin. In a year, one has customers and the other has stock.

Money is a good clerk and a terrible master; the arrangement is entirely up to us. Keep the name. Use the pause it gives you. That is the entire homework.