On: The Mystery of the Kibbutz.
Episode: N/A
Date: October 2018
Background: Author of “The Mystery of the Kibbutz”.
Key Subjects:
- The evolution of the kibbutz (communal farm) movement in Israel.
- Issues that need to be addressed in order for a kibbutz to thrive:
- Self-interest, lack of incentives.
- Solutions: stability of job and income, form of insurance.
- Adverse selection:
- Solutions: select motivated individuals only.
- Free riders:
- Solutions: create small cohesive group with shared ideals, monitor and enforce norms (social sanctions, peer pressure, catch and punish cheaters).
- Brain drain.
- Solution: high exit costs (no savings, no private property, can’t take anything with you when you leave).
- Solution: allows for more effective non-monetary appreciation (value of nurses, teachers, etc.), better alignment of skills and goals.
- Lack of privacy.
- Skills of individuals not always aligned with goals of kibbutz.
- Self-interest, lack of incentives.
- Importance of scale: concept of extended family, only works when people know each other.
- Maximization of a different pie: allows for non-monetary incentives (such as social values) to be weighted as well.
Key Takeaways:
- Small communities allow for better alignment of skills and goals.
Worth Listening:
7/10