So my book will be released on the 8th of September. You can pre-order here. In the next 10 days leading up to the book’s release I thought I’ll publish some bootleg stuff here. This is basically chapters or sections that were in one of the earlier drafts but didn’t make it to the final cut.
What this means, of course, is that in the eyes of me and my publishers, what I’ll be putting here is inferior to what has actually gone into the book. So this post (and the ones I’ll put in subsequent days) put a floor on the quality of my book.
We’ll start with what was supposed to be the preface of my book. This was written back in November 2014, when I had little clue of what would finally go into the book. But I sat down one chilly evening on the outskirts of Bangalore and wrote this off in one stretch. Pasting it here verbatim without editing.
There is a class of books that could have been a long blogpost. Perhaps not, since a blogpost is usually constrained by its word length – you are extremely unlikely to find a blogpost that is longer than 2000 words. Yet there exist books that are much longer than they need to be. The key ideas in these books are expressed in the first couple of chapters, beyond which the information content is minimal. Yet we find that the authors would have expended considerable effort into those chapters that ultimately add no value.
There is good reason for this. And there is a good chance that this book might turn out this way (unlike most forewords, this foreword is being written BEFORE starting to write the book). And the reason this book might turn out to be longer than it needs to be can be explained by the concept that this book is supposed to deal with – liquidity.
Over the years, authors have not figured out a way to monetise works of around 10000 to 20000 words long. One obvious outlet for such works is magazines, and you have magazines such as The New Yorker or Caravan that publish many an article of such length (both fiction and non-fiction). The problem, however, is that writing for a magazine is usually not remunerative for the author – both the amount and fame received pale significantly compared to what the author can obtain by writing a book.
The market for books of 10000-20000 words long, however, is not particularly well developed. Over the years, some conventions have been established regarding the “ideal” length of a “good” book, and this ideal length is somewhere between 200 and 300 pages long. Assuming 300 words per page in the typical copy, this translates to anywhere between 60000 and 90000 words, and you will notice that most books fall in this word range.
This doesn’t meant that word count of books necessarily need to fall in this range – it is possible for books to be much longer or shorter and yet be successful. At the long end of the spectrum, you have Vikram Seth’s A Suitable Boy, which is 591,552 long and wildly successful. Another example is Neal Stephenson’s The Baroque Cycle (admittedly a collection of eight closely-connected stories), which I read all through last October and November, at about 3000 words long.
The short end is not particularly well populated, though. A book that is much shorter than the conventional 60000-90000 words usually gets reclassified into “short story” or “article” form, and such writings are best published as part of magazines rather than as standalone books. Over the last four of five years, Amazon has tried to create a market for 10000-word books in the form of “Amazon Singles”, but so far the format hasn’t taken off particularly well, with both writers and readers hesitant to embrace the format.
It might be well possible that I might be able to do a fantastic job of explaining to you the concept of Liquidity, and all its applications, in about 10000 words. Yet, that creates a problem for it will be firmly in “article length” territory, and my long-held ambition of becoming a “published author” will not be fulfilled. I’m going to struggle to find publishers at that length, and even if I publish it as an Amazon Single, wide readership is not guaranteed. Since I’m looking to write a “proper” book, my editors will want it to be much longer.
And so I’ll add superfluous chapters. Words that don’t add any information content will be inserted at various places in the book. There will be tremendous redundancy. It significantly increases my cost of writing, and your cost of reading. Yet I’ll do it so that I can enter this book in a more “liquid” category. And you might be more compelled to buy it when my book is in a more “liquid” category. You might struggle through the latter half of the book, but you’ll be happy that you read a “proper” book. And I will be a published author.
The reason for making this book longer than it needs to be perhaps gives you a flavour of what is to come in the book. This book is about “liquidity”, the economic quantity that describes markets in terms of the number of buyers and sellers in it. We will talk extensively about transaction costs, and two-sided network effects. We will see how liquidity plays an important role in several markets, and in ways that you wouldn’t have imagined.
Liquidity will explain, for example, why it is harder for certain specialists to find jobs. It will explain why till recently fairs were a popular phenomenon. It explains why footballers seem to be either severely underpriced or severely overpriced. It explains why your neighbourhood mom-and-pop store doesn’t stock exotic foods. And why the Big Mac Index is flawed.
I hope to compensate for the inflated length of the book by peppering it with interesting insights, most of which are connected by the common thread of liquidity. Most of the chapters will have a “liquidity is the reason” flavour, which I admit might make the book boring. Since the book deals with a single concept, there is not going to be any sense of suspense. Yet, once you settle in, you might be tingled by how and why liquidity affects that particular market! Midway through a chapter you might want to guess why liquidity affects that particular market. And the answer, I hope, will surprise you more often than not.
Reminder: You can pre-order the book (available on both print and kindle) here