Leapfrogging: How Civilizations Progress And Make Smart Decisions

Forbes has given me the opportunity to write this "Leapfrogging" column, so I'm taking the opportunity to explain its generic title. (In 1998 Forbes Global used the word "leapfrogging" for a cover story about my writings and doings.)

Readers may think the reason is obvious: because people want to get ahead and they need a benchmark to judge their performance; because companies want to leapfrog their rivals; because countries want to either get ahead or restore their former fortunes when they fall behind. They need benchmarks for judging their performance too. That is what "leapfrogging" means.

But "leapfrogging" also refers to a leap from definition to execution. Without financing risk-taking accountably, whether on personal or national levels, there is no leapfrogging. The question becomes: If leapfrogging is so simple, why is "financing risk-taking accountably" so difficult? The veils of language manipulate thought and create a serious hindrance when identifying problems and discovering their solutions.

Charles Mackay, in his 1841 classic, Extraordinary Popular Delusions and the Madness of Crowds, explained that dissatisfaction with one's lot in life, far from leading to evil, has been the "great civilizer of our race." Such discontent has also been the source of "follies, speculations, absurdities." Our leapfrogging instinct is the one that makes us creative and allows us to venture into the unknown, for better or worse. But when will people be more likely make potentially constructive or destructive bets? ...

Reuven Brenner holds the Repap Chair at McGill's Desautels Faculty of Management. This article draws on his books History - the Human Gamble (1983) and World of Chance (2008).

Read full article: Forbes, December 17, 2010