Post on 23-Jan-2018
Towards a New Distributional EconomicsTim O’Reilly
@timoreilly
wtfeconomy.com
BRIE – OECD
December 1, 2017
Tim O’Reilly
Founder & CEO, O’Reilly Media
Partner, O’Reilly AlphaTech Ventures
Board member, Code for America
Co-founder, Maker Media
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What the great technology
platforms teach us about the future
of work, business, and the
economy.
wtfeconomy.com
Fitness Landscapes
The way in which genes contribute
to the survival of an organism can
be viewed as a landscape of peaks
and valleys.
Through a series of experiments,
organisms evolve towards fitness
peaks, adapted to a particular
environment, or they die out.
Image source: http://evolution.berkeley.edu/evolibrary/article/side_0_0/complexnovelties_02
Technology also has a fitness landscape
In my career, I’ve watched a
number of migrations to new
peaks, and I’d like to share with
you some observations about
what happened, and why.
Personal
Computer
Big Data
and
AI
Smartphones
Apple
Divergence of productivity and real median family income in
the US
Will there really be nothing left for people to do?
Is there really
nothing left for
humans to do?
We’ve forgotten the lessons of history
The weavers of Ned Ludd’s rebellion couldn’t imagine…
They couldn’t imagine…
What happened when Amazon added 45,000 robots
Jeff Bezos calls this “the flywheel”
A Business Model Map of Uber
Magical user experience
realizing the power of
networked sensors
Replacing ownership
with access
A platform, not just a
company
An algorithmic matching
marketplace
Cognitively augmented
workers
The coming robots are not autonomous
Gradually, then suddenly
1. The world is becoming digital
2. Artificial Intelligence and algorithmic systems are
everywhere
3. Knowledge is embedded into tools
4. We are creating new kinds of partnerships between
machines and humans
The Equinix NY4 data center,where trillions of dollars change hands
What does it mean that these
platforms, and the humans that are
part of them, are increasingly
managed by algorithms?
wtfeconomy.com
“Markets are outcomes”
- Mariana Mazzucatto
“My grandfather wouldn’t
recognize what I do as
work.”
-Hal Varian
A new kind of management
“It’s the difference between ‘playing
Caesar’ (deciding which projects live
and die), and ‘playing the scientist’
(being perpetually open to search and
discovery.)”
- Eric Ries, The Startup Way
Algorithmic systems all have an “objective function”
Uber and Lyft: Pick up time
Google: Relevance
Facebook: engagement
Scheduling systems used by Walmart, the Gap, or
McDonalds: reduce employee labor costs and benefits
Like the djinn of Arabian mythology, our digital djinn do
exactly what we tell them to do
AI is “the most serious
threat to the survival of
the human race”
Elon Musk
The runaway objective function
“Even robots with a seemingly benign
task could indifferently harm us. ‘Let’s
say you create a self-improving A.I. to
pick strawberries,’ Musk said, ‘and it
gets better and better at picking
strawberries and picks more and more
and it is self-improving, so all it really
wants to do is pick strawberries. So
then it would have all the world be
strawberry fields. Strawberry fields
forever.’ No room for human beings.”
Elon Musk, quoted in Vanity Fair
https://www.vanityfair.com/news/2017/03/elon-musk-
billion-dollar-crusade-to-stop-ai-space-x
The Runaway Objective Function Behind Fake News
And yet…. Divergence of productivity
and real median family income in the US
“The art of debugging is
figuring out what you really told
your program to do rather than
what you thought you told it to
do.”
Andrew Singer
Andrew Singer
Who Gets What – and Why?
Can we redesign markets so that they are
more effective? There’s lots of evidence
that we can.
What would it take for us to
Put people to work tackling the world’s greatest problems?
Treat humans as assets, not liabilities?
Create an economy based on caring and creativity, while machines focus
on repetitive tasks?
Apply on-demand marketplace models to healthcare, augmenting
community health workers with telemedicine and AI?
Give everyone access to knowledge on demand, whenever we need it?
Have fresh approaches to public policy based on what is possible now,
and by learning what works, rather than picking from set political menus?
What’s the Future?
It’s Up To us
wtfeconomy.com