The Nature of Value: How to Invest in the Adaptive Economy

The Nature of Value: How to Invest in the Adaptive Economy

by Nick Gogerty


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Using evolution as the template to understand growth, The Nature of Value takes a first-principles approach to explore the parallels between economic and ecological systems. Not only does Gogerty show how value is born out of tiny sparks of adaptive innovation, but he also explores the full scope of the economy as a complex network. He borrows from an array of disciplines—including anthropology, psychology, ecology, physics, sociology, and ethics—and, most revealing of all, examines how evolution's processes can help investors avoid risk and improve their allocation decisions.

Starting with a look at how innovation creates value for firms, Gogerty considers the economic niches where companies compete and explores how they can create defensive moats to enhance their ability to survive. Throughout the book, Gogerty demonstrates how this ecological understanding of the economy can help allocators improve their performance, supporting his arguments with extensive data and years of practitioner experience from scientific, social, and economic disciplines. Gogerty's practical takeaways, couched in vivid explanations and accompanied by intuitive illustrations, help investors of all backgrounds gain fresh insight into the behavior of corporations and the economy in general.

Product Details

ISBN-13: 9780231162449
Publisher: Columbia University Press
Publication date: 07/08/2014
Series: Columbia Business School Publishing
Pages: 368
Product dimensions: 6.30(w) x 9.10(h) x 1.10(d)
Age Range: 18 Years

About the Author

Nick Gogerty is a private account strategist and general problem solver for the world's leading hedge funds, banks, technology firms, and scientific research institutes. He has worked as a quantitative developer and trader on a proprietary foreign exchange desk in London, advised major institutions and the government on risk, and been a serial entrepreneur at the convergence of technology and media. He is deeply interested in growing sustainable economic value and reducing global poverty.

Table of Contents

Part I: Value
1. The Problem with Price? It's Not Value
2. Value and Why It Matters
3. The Theory of Value
Part II: Inos
4. Knowledge and Innovation
5. How Innovative Capabilities Enable Value Creation
6. Allocating to Firms with a Unique Capability Mix
Part III: Clusters
7. Birth and Growth of Clusters
8. Cluster Convergence, Maturation, and Death
9. Stable and Unstable Clusters
Part IV: Moats
10. The Value of Moats
11. How Moats Affect Cost, Competition, and Customer Forces
12. Managing Moats, for Value Creation Today and Wealth Tomorrow
Part V: The Economy
13. The Economy as a Macroprocessing Network
14. Monetary Shocks and Their Implications for the Allocator
Part VI: The Nature of Value
15. The Nature of Value Allocation
16. Conclusion

What People are Saying About This

Paul Johnson

In the great tradition of Charlie Munger's 'worldly wisdom,' Nick Gogerty delivers a multidisciplinary approach to finding investment value. Through brilliant graphics and a unique lens, he educates the reader on how to discern investment opportunities that go well beyond currently reported financial results to gain insights into how value shifts over time. Any investor who feels the 'value investing' paradigm is lacking in its ability to navigate our increasingly complex world will benefit from the tools Gogerty offers.

Guy Spier

Nick Gogerty has done a phenomenal job of developing and clarifying economic value when it comes to equity investing. His book incorporates new thinking about the economy as a dynamically evolving, complex, adaptive system. Gogerty introduces new ways to apply these concepts on the granular scale of the firm. This book will certainly enhance the reader's ability to make good investments and is a must-read for any thoughtful investor.

Steve Waite

The convergence of economics and biology is fertile ground that offers a path out of the dark age of static equilibrium and efficient markets. Nick Gogerty's illuminating book gives us a deeper and more robust understanding of the complex dynamics that create and sustain value.

Customer Reviews