Path Dependence

Path Dependence is a fancy way of saying, “We have always done it this way.” It is defined by the Business Dictionary as, “Tendency of a past or traditional practice or preference to continue even if better alternatives are available.”

Examples of Path Dependence include the QWERTY keyboard, Microsoft Word (if you are going to use another word processor, it better be able to read Word files!) and the width of railroad tracks and the cargo they carry (legend has it that the four-foot eight-and-half inch standard is based on the size of rail used in small coal mines in Britain or the width of Roman chariots).

Real estate appraisal is far from immune from these sort of ruts. I mean, are physical inspections always necessary? What exactly is one to learn by inspecting a 5-year-old rectangular industrial building?

Oh, and detailed county and city write ups? It is a great way to sell one’s work product by the pound, but I am not sure anyone has ever read them. And if someone has taken the time to read them (time, sadly, they will never get back), they heave learned nothing useful or relevant to the appraisal problem.

It all hit bottom when the world’s largest bureaucracy, the United States Army, lent its charm to the practice of appraisal with the 1971 publication of the Uniform Appraisal Standards for Federal Land Acquisitions.

Also known as the Yellow Book (because the title was so generic as to render it meaningless, and the book was actually yellow), the guidelines contained in the UASFLA virtually ensure a turgid, unreadable and tedious work product incomprehensible to all but a few Laputan review appraisers.

Ironically, the Yellow Book was created specifically for eminent domain matters that could ultimately be decided by a jury of real, live, human beings.

Oh, how I pity them.

Image result for rut in the road

 

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