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Killing Kakanomics
Killing Kakanomics

From the iconic film, Serpico:

We got a call about you. From downtown. I ain’t sayin’ who. They said you can’t be trusted.

Why? Because I don’t take money?

KEOUGH (laughs)
Who can trust a cop who won’t take money?

Frank Serpico (the real-life cop played by Al Pacino) wouldn’t have known the term (it was first coined in 2011), but he was a victim of Kakanomics.

Kakanomics, the ‘economics of rottenness’, is the name given by two Italian academics, sociologist Diego Gambetta and philosopher Gloria Origgi.

They were attempting to describe and explain the phenomenon of people colluding (in an understood, but unstated way) to mutually provide a low-quality, often dishonest, exchange of goods or services.

They give an example from their native Italy of people voting in corrupt politicians, who will then not enforce tax collection. Everybody knows this is the deal, that by necessity, must go unstated.

As soon as I read this, it explained so much of my frustration with the way that the agency world works.

The marketing department and the agency collude – the agency, will provide templated, mediocre creative work and strategy, and the client will pay their fees, and no-one will ask any awkward questions about whether this works, or whether there’s a better way of doing this. What does the client get out of this?

Their mediocrity and poverty of imagination will go unchallenged – most importantly, no-one will ask how we let this level of mediocrity continue so long.

The last thing this marketing department wants is someone coming in, whether a new staff member, or an agency or other consultant, and asking questions or challenging the way things are done. There doesn’t even need to be a critical agenda – the Serpico who won’t collude is rightly seen as a threat to the whole system.

One of the key symptoms is resisting any meaningful form of measurement.

No-one wants cold hard data – that’s much harder to argue with – though if you have to have data, you can at least try to frame it in the way that will cause least harm.

Is Kakanomics describing an obscure scenario – real, but rare? What is your experience? I would suggest it is largely the norm, with greater or lesser degrees of intensity. And these organisms are very powerful, sniffing out, and then snuffing out, threats. Darwinian principles in a grotesque form: survival of the feckless.

Those organisations that will truly succeed, that will break free of the bounds of mediocrity, need to have an incredibly strong culture of excellence, challenge, and courage. Which always has to come from the top.

In the long run the chickens will come home to roost, but then, as Keynes said, in the long run we’re all dead.

People will just make this calculation: can I see this out until I move on / retire?

Make no mistake: either you kill Kakanomics, or it kills you. Are you up for the battle?

Michael Isaacs

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