I think upside decay is most applicable to venturesome things. So for example, a plastic chair factory is not very venturesome because the technology and processes are well established. The factory manager can be a real jerk and people will still buy his chairs. On the other hand, things like creating a startup, making smaller semiconductors, or new energy technologies are much more affected by upside decay.
Using the example of scientific discovery, it feels like a major country could have assets such as high investment into education and R&D that helped it have lots of rare discoveries, even if its foreign policy didn’t do it any favors and lost it weak ties.
I think this country would be good at incremental discoveries, improvements, some types of development, and commercialization. But it wouldn’t be good at generating rare discoveries. Using your example of a board game, weak ties can be translated into “Victory Points” at different ratios depending on the type of activity you’re looking at.
Thanks for your thoughtful response! I chose China as an example because it concisely illustrates the contrast—China dominates all the segments that don’t need upside, but struggles for those that do. It also explains the narrow definition of virtue I use. It assumes a moderate knowledge of current affairs which is definitely something that’s boring for a lot of people, but I’m personally more familiar with China and less familiar with other possible examples like cryptocurrencies or AGI.