Airbus’s woes are being held up as proof that it is, in the words of one columnist, “a textbook example of how not to run a commercial enterprise.” The Wall Street Journal explained that Airbus was failing because of its “politicized management,” while the Times suggested that Airbus had to decide whether it was a company or a European “employment project.” … What much of the talk about the inherent weakness of Airbus ignores is that, just a few years ago, it was Boeing that looked fundamentally flawed, while Airbus was seen as the future of the industry. … The problem with such prognostications is that they infer basic truths about a company’s prospects from its short-term performance. … People are generally bad at accepting the importance of context and chance. We fall prey to what the social psychologist Lee Ross called “the fundamental attribution error”—the tendency to ascribe success or failure to innate characteristics, even when context is overwhelmingly important. … Because we underestimate how much variation can be caused simply by luck, we see patterns where none exist. It’s no wonder that management theory is dominated by fads: every few years, new companies succeed, and they are scrutinized for the underlying truths that they might reveal. But often there is no underlying truth; the companies just happened to be in the right place at the right time.
This applies not only to judgements about the success of companies, but to judgements about the success of countries. A few years ago, the political scientist Peter Katzenstein went through a couple of decades worth of those special issues that the Economist runs on particular countries for his own amusement. He found that there wasn’t any long term consistency in judgement – a country cited as a model of how to create a thriving economy in one special issue might be cited as a prime example of political dysfunction the next time round, and back in the good books a few years later. This isn’t a problem that’s specific to the Economist; it’s a more general one of how the political wisdom on the sources of economic success is incredibly unstable. A couple of decades ago, the shelves were filled with books on Japan Inc., and nasty xenophobic bestsellers like Michael Crichton’s Rising Sun claiming that Japan was going to gobble up America unless it fought back. Before that, there was a lot of talk about Modell Deutschland as the way forward. Und so weiter. We don’t know very much at all about the root reasons why economies succeed or fail, for some of the reasons that Surowiecki cites. Countries too can happen to be in the right place at the right time, and may find their luck running out unexpectedly when conditions change.