Coding the economy to cut the high price of low cost

Photo by Ray Hennessey on Unsplash

The allocation of resources - and the cost of optimising that allocation - has always been humanity's most profound challenge. Artificial Intelligence may offer our best solution - but only if we are prepared to think globally.

Capital and the market model it sustains has been held up as our best bet for resource allocation for centutres. Yet capitalism and its governance are not necessary states by any means. They are emergent properties of the complex adaptive system we describe as the economy.

One transaction allocating value does not capitalism make. Multiple ones at scale can. Just as a molecule of water is not a wave, let alone a tidal force. These are emergent properties of complex adaptive systems.

The interactions within the system are what creates those emerging properties. Change those interactions and the properties change.

The best modifier we have had to date has been Government intervention - taxes, laws, welfare etc. But complex aqdaptive systems are notoriously difficult to tinker with. Think of the butterfly effect as applied to weather (another complex adaptive system).

So a Trump here or a Brexit there is going to have some impacts, but predicting exactly who, where and what feels the chill wind is a somewhat more exacting science than knowing that change will come.

As our economy has become more connected (and decentralised) it is becoming more anti-fragile. Make no mistake the economy will keep on functioning no matter what governments do. The question is can it be controlled somehow to ensure the emergent properties are desirable for humanity?

As we head towards quantum computing and ever more intelligent automation the point looms at which decisions to allocate resource will patently be better handled by machines.

Our machines will be better able to calculate the global economic costs of each transaction. They will factor for the environment as much as for human need. If we code that in.

But this is going to be a greater race for power than military applications of AI. Those who choose not to take part will be at significant compertitive disadvantage to rivals.

So the pressures to allocate to meet immediate human gratification will be huge. Only through global agreement on total costs will we give our children a chance.

Why robots are essential to kick-start our next age of innovation

Yamaha's Robot rider could one day end the  chore
of riding fast motorbikes... er, ok it's not all good.

There is an argument - and a well made one at that - that our era is not an age of great technological change - but actually one that is quite stagnant.

Robert J Gordon made the case in his book 'The Rise and Fall of American Growth'. He points out that the Great Inventions that caused real change arrived between 1870 and 1970.

The internal combustion engine changed the way we travel (removing the growing threat of horse manure - which experts predicted would reach 9 feet deep on London's roads by 1950 if allowed to go unchecked). It changed the way we travel much more than any subsequent improvement in performance or styling.

Urban sanitation similarly had a greater impact on our health than medical inventions of more recent years. The invention of the telegraph versus the written message carried by ship, horse and hand which preceded it is a far bigger shift than fax to email or phone to mobile.

The impact was that we got to live (US childhood mortality tumbled from 1/3 in 1860 to 1/200 today), we got to live longer, and we got more time to do with as we pleased (being liberated from household tasks such as washing clothes and preparing meals which had taken 58 hours in 1900 - and 18 in 1970).

Jesse Frederick argues in his assessment of Gordon's ideas that our blindness to the comparative stagnation of the modern era can at least be partially attributed to the fact that the technology of the past mainly created time, whereas today’s technology fills it.

Gordon, published in 2016 - sees this stagnation as permanent. Mostly because the big wins for technology have already been won. But part of the problem is for all our technology we feel as though we have less time. And time is essential for the ideas that make real change.

Enter Robots. the AI revolution and the robotics it is driving are about to answer Jesse's criticism of today's inventions. They are certainly not a technology that fills time, they will create at least 18 hours for us (finishing up the last bits of housework our inventors have failed to resolve so far - ironing, dusting, food prep and cooking, physically moving the devices about etc). The internet of things completes the picture in shopping.

Ok, an 18 hour saving isn't as great as the 40 hour leap that got us here - but this one will come in 5-10 years. The last took 70.

And we haven't even considered the saving in time AI will bring to our working (and commuting) lives. Finally, the time technology promised to free for us will actually arrive.

And yet, even for the slam-dunk win our robot friends will provide, there's an even bigger opportunity for genuine life change: How we organise is changing.

How we organise is society and society is how we live.

As I have long argued; the web enables adhoc self-forming groups to get things done. That's a fundamentally different form of organisation than preferred by 1870-1970. That era was also an era of centralisation and mass production. The next 10 years is about decentralisation and personalisation; whether it be through micro factories in every home (3D printing), the move away from public transport (driverless cars, drones) medical technologies that self diagnose and repair (nanobots) or how we learn, get justice, make contracts and exchange value (blockchain).

We will have the opportunity to live entirely unique, separated lives. But all the evidence of the world since the web is that we will use it to become closer and better connected - without the need for central organisation.

A future without centralised or top-down direction is being enabled through the technologies of this decade and the next. 

Very soon we will have the collective time to carefully consider what our future should look like and imagining how we can reach it - kick-starting the next age of innovation.

And that, when we pause to reflect on the shift from 2010 to 2030, will, I believe, provide us with a case to say we really do live in a time of not just fast, but radical change.