This idea forms the basis of a crackpot theory I have about business and economics which is that value accrues to firms that find new ways to “alter the constraints of the game. “

To steal an example from Ben Thompson, the internet enabled Netflix to change television in a highly nonlinear way. Instead of Starz offering their 11,000 title catalog in a linear fashion (whatever was on the channel at the time), Netflix offered their whole catalog at all times to all users. This is a shift in constraints that fundamentally changes the nature of personal entertainment which allows the sector to reach a higher state of ‘entropy’. The market subsequently ‘rewards’ Netflix for the change.

These nonlinear shifts are enabled via changes in technology, law, finance, and social norms. Of course this is all crackpottery, and there are probably tons of counter examples to be had, but these are fun ideas to play with nonetheless.

Political, economic, social, technological, legal, environmental? PESTLE?

Yeah I think that’s the one! Where did you find this? Is it business 101 stuff?

Yeah, business strategy MBA kinda stuff. Although honestly not sure how useful it really is. I guess it helps you have a broad checklist of things you should look at.