Attention Economy


Wednesday, May 22, 2019

Revitalizing Capitalism

Richard Reeves notes:
“It is now more than half a century since the Club of Rome published The Limits to Growth and Fred Hirsch published the Social Limits to Growth. The first argued that the depletion of natural resources would put the brakes on economic progress; the latter that competition among the affluent for positional goods (valuable precisely because of their scarcity) would reduce overall welfare. While both predictions contained important truths, neither have so far proved correct. Market-fueled growth has slowed, certainly by comparison to the booming decades in the middle of the last century, and has become more skewed towards the rich, but it has not stalled.
The question now is not, I think, whether and how capitalism will end, but how it can renew its promise of a better future – for us all.”

Nobel Prize winning economist Paul Romer observes:
“It is the job of government to prevent a tragedy of the commons. That includes the commons of shared values and norms on which democracy depends. The dominant digital platform companies, including Facebook and Google, make their profits using business models that erode this commons. They have created a haven for dangerous misinformation and hate speech that has undermined trust in democratic institutions. And it is troubling when so much information is controlled by so few companies.
What is the best way to protect and restore this public commons? Most of the proposals to change platform companies rely on either antitrust law or regulatory action. I propose a different solution. Instead of banning the current business model — in which platform companies harvest user information to sell targeted digital ads — new legislation could establish a tax that would encourage platform companies to shift toward a healthier, more traditional model.”

How Capitalism Betrayed Privacy
Columbia University Law Professor Tim Wu makes an interesting point:
“The historical link between privacy and the forces of wealth creation helps explain why privacy is under siege today. It reminds us, first, that mass privacy is not a basic feature of human existence but a byproduct of a specific economic arrangement — and therefore a contingent and impermanent state of affairs. And it reminds us, second, that in a capitalist country, our baseline of privacy depends on where the money is. And today that has changed.”

Related:
https://www.nytimes.com/interactive/2019/04/10/opinion/internet-data-privacy.html

Chicago economist Raghuram Rajan notes:
“More generally, the more that government-defined intellectual-property rights, regulations, and tariffs – rather than productivity – bolster a corporation’s profits, the more dependent it becomes on government benevolence. The only guarantee of corporate efficiency and independence tomorrow is competition today.”

Related: