For a New Way to Manage Risk, Look to the Past

Every now and then, a story comes along that makes us editors say, "Why didn't we think of that?" This is one of those stories, which looks at the devastating Ebola crisis through the lens of both history and risk management, with lessons that go beyond what's happening in Africa. In a recent article in the journal Environmental Systems and Decisions, a group of risk management experts dissect how Venice responded to the Black Death in the 1400s. At first glance, that response may seem chaotic; but "the authors of the article argue that beyond the chaos lay some surprisingly sophisticated crisis management," with civic leaders simultaneously enforcing rules like quarantines while also remaining "flexible enough to try alternatives when things went wrong."

This all comes down to what the article’s authors call resilient risk management. It differs from what usually happens, which involves "predicting the likelihood of various specific crises and devising specific solutions." Resilience theory holds that "many threats are fundamentally unpredictable or have unpredictable twists or secondary effects." Or as Igor Linkov, a coauthor, posits: "Can we design our countermeasures in a way that no matter what the threat is we still manage to do our best to recover fast?" In order to do this, you have to take two tenets to heart: Preparing and communicating with people before a disaster happens is paramount; and you also have to recognize that you don't have all the answers up front.

If You're Dating or Buying a House When Fewer Choices Are Worth More Knowledge@Wharton

If a real estate company were to tell buyers that they could only look at 10 houses at a time, and that each seller was showing his or her house to just 10 potential buyers, would it be more or less successful than a company that allowed buyers to see hundreds of properties? Pinar Yildirim of Wharton thinks it would be more successful. She and colleagues Hanna Halaburda and Mikolaj Piskorski have found that under certain circumstances, when companies offer limited choices to consumers, they can still successfully compete with other firms – and they can charge more. For example, one of eHarmony’s competitive advantages in the matchmaking market is that it limits competition on both sides of the match. So when you contact someone, your chances of getting a response are higher. On other sites, so many messages go flying around that people get inundated. The beneficial effects of fewer choices seem to apply to companies that provide platforms where both sides have to consent to a match. —Andy O’Connell

(Don't) Google It The Solace of Oblivion The New Yorker

By now, we're all familiar with the basics of this past spring’s European Union privacy ruling against Google: The European Court of Justice ruled that people in the EU "had the right to prohibit Google from linking to items that were 'inadequate, irrelevant or no longer relevant, or excessive in relation to the purposes for which they were processed and in the light of the time that has elapsed.'" That is: you have a right for certain information to be “forgotten” on the internet. So, what exactly does this mean in practice? Jeffrey Toobin visited Google to learn more about how they're reluctantly — but seemingly diligently — handling this new and unexpected aspect of their business, tracing the history of personal information-gathering that helps explain why the U.S. and Europe weigh privacy and free speech very differently. It's a nice primer on a range of views about what search engines should and shouldn't reveal, and how the extraordinarily powerful company in the middle of the battle is responding.

We're All Wondering Larry Ellison Bought an Island in Hawaii. Now What?The New York Times Magazine

The Hawaiian island of Lanai reminds me of Black Beauty, the 19th-century English novel told from the point of view of a horse that bounces from owner to owner, enduring kindness and cruelty and more kindness and more cruelty. Lanai was home to just Hawaiians for a few centuries, then fell under the ownership of mainlanders who ranched sheep and grew sugar cane and pineapples. Then it was owned by a California billionaire who built resorts and eventually tried to construct a wind farm, which provoked protests. Now, Green Beauty is mostly owned by Oracle founder Larry Ellison, who intends to transform it into a luxury tourist spot and “the first economically viable, 100 percent green community.”

One woman tells writer Jon Mooallem that Ellison is rejuvenating everything, and she feels blessed beyond her wildest dreams. In the past, Ellison has been quoted as saying that the island feels to him like “this really cool 21st-century engineering project.” But not everyone likes being part of someone else’s cool engineering project. Some residents seem to view Ellison’s actions with suspicion and uncertainty. “Like a lot of omnipotent forces, Ellison has remained mostly invisible,” Mooallem writes. “He has visited Lanai many times — locals told me they can tell he’s on the island when they see his yacht hitched in the harbor — but he seems determined to keep a formal distance from the community.” —Andy O’Connell

"Watch Yourself" Occupational Hazards of Working on Wall Street Bloomberg View

Michael Lewis knows a little something about Wall Street. And getting past the usual employee complaints about the financial sector (long hours, for one), he offers several often-hidden occupational hazards for the stellar university graduates who think they can make it in the industry while also holding on to ethics and personal responsibility. One: "Anyone who works in finance will sense, at least at first, the pressure to know more than he does." And many of the things you have to pretend to know can't even be known in the first place, he argues. "You will be paid a lot more to forget your uneasy feelings." Two: Working in finance does not involve joining "a team of professionals committed to the success of your bank." Instead, most who work on Wall Street and are successful "have no serious stake in the long-term fates of their firms." And three: "Anyone who works in big finance will feel enormous pressure to not challenge or question existing arrangements."

So for those embarking on a career in finance, Lewis has one last piece of advice: "Watch yourself, because no one else will."

Editor's Note: I've had the best time sharing with you the articles our editors have found to be important, controversial, useful, and sometimes downright entertaining. That's why I'm sad to announce that this is the last edition of the Shortlist. This doesn't mean we won't still be alerting you to the best reads from other places; rather, you'll be increasingly able to find them via our social media channels (Facebook, Twitter, LinkedIn and Google+). We will be reinvesting the editorial time that went into the Shortlist in exciting new formats we hope will help you work smarter, faster, and better.

So thank you for subscribing to the Shortlist. It's been such pleasure to write, and I hope it's been a pleasure to read, too. —Gretchen Gavett, Associate Editor