Leverage & Positional Advantage

Rosen's superstar economics — how position and leverage (people, capital, media, code) multiply the return on effort exponentially, in contrast to effort alone which scales only linearly.

Also known as: leverage and position, positional leverage, superstar economics, economics of superstars

Documents (4)

• SWLW #711: The laws of this world (game theory), Should you still become a Software Engineer in 2026, and more. Oren Ellenbogen · 2026-07-10 Reader 🖥️
  As AI compresses both the cost of writing code and the reliability of the signals people and organizations have used to judge value (interviews, hours logged, raw effort), this issue's throughline is that the decisive differentiators shift to what resists commoditization: disciplined distrust toward AI output, deliberate positioning/leverage over sheer effort, and self-directed habits (monthly growth checks, daily writing) that build judgment rather than borrow it.
• Are We Entering a New Age of Creativity with the Help of AI? Harvard Business Review · 2026-07-07 source ↗ Reader 🖥️
  Laurene Powell Jobs's Atlantic-OpenAI content-licensing deal exemplifies the correct strategic response to generative AI for creative institutions: treat AI licensing as a short-term revenue and access play while doubling down on human-curated 'meaning' and top-tier creative talent, because genuine creativity — unlike AI's pattern recognition — remains scarce and is what audiences will still pay for.
• The Laws of this World (Game Theory) Incentivising · 2026-06-19 source ↗ Reader 🖥️
  The widening gap between effort and reward is not personal deficiency but structural ignorance of five hidden market mechanisms — positional leverage, visibility-as-signal, market indifference to effort, problem selection, and outcome- rather than output-accounting — so working harder cannot close it, but understanding and redirecting toward these mechanisms can.
• 90% of My Skills Are Now Worth $0 Kent Beck · 2023-04-19 source ↗ Reader 🖥️
  A technological revolution has just made roughly 90% of Beck's professional skills economically worthless by making their output free, while multiplying the leverage of the remaining ~10% (knowing what to ask for, and judging the result) by a thousand, so the only sane response is to recalibrate which skills to invest in by rapidly trying many things rather than reasoning it out in advance.

Propositions touching this concept (2)

By publication month, oldest first (extraction month when no publication date is known).

2026-06

• explicitestablishedEffort's payoff scales linearly, but position (leverage across people, capital, media, and code/automation) multiplies output exponentially, so where and how effort is applied matters more than how much effort is applied — citing Sherwin Rosen's 'Economics of Superstars.'
  The Laws of this World (Game Theory) · p2

2026-07

• implicitInvesting outsized resources — well-above-industry-standard salaries — in a small number of exceptionally creative individuals is a strategic bet that positional leverage, not raw effort or content volume, is what compounds value in the AI content economy.
  Are We Entering a New Age of Creativity with the Help of AI? · p11

Open gaps (5)

• incompleteThe interview never follows up on what happens to the writers and journalists who are not top-tier creative talent and are being 'weeded out' as legacy outlets like the Atlantic double down on a smaller roster of highly paid stars. Elkins states plainly that Powell Jobs 'is weeding folks out' and that the publishing 'funnel... is getting more and more narrow,' but the whole argument stays optimistic about the shrinking population of winners without examining the losers' fate, alternative markets, or what this means for journalism's overall labor market and coverage breadth (e.g., local news, beat reporting). This is the sharpest gap: an argument about creative-industry winners built on an unexamined and possibly large population of creative-industry losers.
  Are We Entering a New Age of Creativity with the Help of AI? — read next: Labor-economics and media-industry literature on winner-take-most/superstar dynamics in creative markets, and reporting on the collapse of local and freelance journalism under both the advertising-model crisis and AI displacement.
• illogicalThe central 'meaning cannot be commodified out' argument rests on one negative case (Buzzfeed's failure) and one still-unresolved positive case (the Atlantic, whose own outcome Elkins repeatedly disclaims — 'we'll see where it goes... I have no crystal ball'). No comparative base rate of publisher-AI licensing deals succeeding versus failing is offered, so the argument's generalizability is asserted rather than demonstrated.
  Are We Entering a New Age of Creativity with the Help of AI? — read next: Longitudinal tracking of publisher-AI deal outcomes (traffic, revenue, subscriber retention) as more of the '70+' deals mature past their first year or two.
• incompleteThe five principles are reverse-engineered from observing successful 'superstars' and institutions, with no comparison group of people who pursued the same leverage-building, signaling, and problem-selection strategies and still failed. Without that counterfactual, the essay cannot distinguish 'these mechanisms cause success' from 'these mechanisms are what winners retrospectively describe' — a textbook survivorship-bias gap.
  The Laws of this World (Game Theory) — read next: Michael Mauboussin, The Success Equation, or Nassim Taleb on survivorship bias and hidden failure populations, for how to correct causal claims drawn only from winners.
• incompleteThe essay converts what its own model implies is partly a structural/distributional problem (unequal starting access to leverage — people, capital, media reach, automatable workflows) into a purely informational/strategic one, solvable by 'knowing the mechanisms.' It never asks how a reader with none of the four leverage types acquires the first unit of any of them, nor engages evidence that visibility and sponsorship access is itself unevenly distributed by factors outside individual signaling choice.
  The Laws of this World (Game Theory) — read next: extract-60-years-men-women-leadership#p6 — the corpus's own evidence that 'informal sponsorship flows along lines of familiarity and visibility that formal policy does not reach' documents visibility access as structurally uneven, not simply a matter of an individual choosing to signal harder.
• illogicalThe issue juxtaposes 'distrust AI output and review it adversarially' with 'stop relying on raw effort and find leverage instead' without noticing that rigorous adversarial review of AI-generated code is itself a form of effort that resists the leverage framing's promise of exponential, effort-decoupled return.
  SWLW #711: The laws of this world (game theory), Should you still become a Software Engineer in 2026, and more. — read next: A treatment of AI-era verification cost as its own leverage category (e.g., tooling/process that multiplies review capacity rather than review hours) would resolve the tension — close to the ceiling-on-AI-assisted-work argument in feedback-loops/automated-signals literature.