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Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society

  • January 2015
DOI:10.1007/978-3-319-15078-9
  • Publisher: Springer International Publishing
  • ISBN: 978-3-319-15077-2
Authors:
Dirk Helbing at ETH Zurich
Dirk Helbing
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Abstract

The rapidly progressing digital revolution is now touching the foundations of the governance of societal structures. Humans are on the verge of evolving from consumers to prosumers, and old, entrenched theories - in particular sociological and economic ones - are falling prey to these rapid developments. The original assumptions on which they are based are being questioned. Each year we produce as much data as in the entire human history - can we possibly create a global crystal ball to predict our future and to optimally govern our world? Do we need wide-scale surveillance to understand and manage the increasingly complex systems we are constructing, or would bottom-up approaches such as self-regulating systems be a better solution to creating a more innovative, more successful, more resilient, and ultimately happier society? Working at the interface of complexity theory, quantitative sociology and Big Data-driven risk and knowledge management, the author advocates the establishment of new participatory systems in our digital society to enhance coordination, reduce conflict and, above all, reduce the "tragedies of the commons," resulting from the methods now used in political, economic and management decision-making. The author Physicist Dirk Helbing is Professor of Computational Social Science at the Department of Humanities, Social and Political Sciences and an affiliate of the Computer Science Department at ETH Zurich, as well as co-founder of ETH''s Risk Center. He is internationally known for the scientific coordination of the FuturICT Initiative which focuses on using smart data to understand techno-socio-economic systems. "Prof. Helbing has produced an insightful and important set of essays on the ways in which big data and complexity science are changing our understanding of ourselves and our society, and potentially allowing us to manage our societies much better than we are currently able to do. Of special note are the essays that touch on the promises of big data along with the dangers…this is material that we should all become familiar with!" Alex Pentland, MIT, author of Social Physics: How Good Ideas Spread - The Lessons From a New Science "Dirk Helbing has established his reputation as one of the leading scientific thinkers on the dramatic impacts of the digital revolution on our society and economy. Thinking Ahead is a most stimulating and provocative set of essays which deserves a wide audience." Paul Ormerod, economist, and author of Butterfly Economics and Why Most Things Fail. "It is becoming increasingly clear that many of our institutions and social structures are in a bad way and urgently need fixing. Financial crises, international conflicts, civil wars and terrorism, inaction on climate change, problems of poverty, widening economic inequality, health epidemics, pollution and threats to digital privacy and identity are just some of the major challenges that we confront in the twenty-first century. These issues demand new and bold thinking, and that is what Dirk Helbing offers in this collection of essays. If even a fraction of these ideas pay off, the consequences for global governance could be significant. So this is a must-read book for anyone concerned about the future." Philip Ball, science writer and author of Critical Mass "This collection of papers, brought together by Dirk Helbing, is both timely and topical. It raises concerns about Big Data, which are truly frightening and disconcerting, that we do need to be aware of; while at the same time offering some hope that the technology, which has created the previously unthought-of dangers to our privacy, safety and democracy can be the means to address these dangers by enabling social, economic and political participation and coordination, not possible in the past. It makes for compelling reading and I hope for timely action."Eve Mitleton-Kelly, LSE, author of Corporate Governance and Complexity Theory and editor of Co-evolution of Intelligent Socio-technical Systems
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Chapter Preprints of the Book «Thinking Ahead» by Dirk Helbing
https://link.springer.com/book/10.1007/978-3-319-15078-9
1. Introduction—Have We Opened Pandora’s Box?:
http://futurict.blogspot.com/2014/09/have-we-opened-pandoras-box_10.html
2. Lost Robustness:
No public preprint available.
3. How and Why Our Conventional Economic Thinking Causes Global Crises:
http://futurict.blogspot.com/2013/04/how-and-why-our-conventional-economic_8.html
or
http://www.paecon.net/PAEReview/issue64/HelbingKirman64.pdf
4. “Networked Minds” Require a Fundamentally New Kind of Economics:
https://rwer.wordpress.com/2013/04/24/networked-minds-require-a-fundamentally-
new-kind-of-economics/
5. A New Kind of Economy is Born - Social Decision-Makers Beat the “Homo
Economicus”: https://arxiv.org/abs/1309.7453
6. Global Networks Must be Redesigned:
https://www.sciencedaily.com/releases/2013/05/130501131943.htm
7. Big Data—A Powerful New Resource for the Twenty-first Century:
http://futurict.blogspot.com/2014/09/big-data-powerful-new-resource-for-21st.html
8. Google as God? Opportunities and Risks of the Information Age:
http://futurict.blogspot.de/2013/03/google-as-god-opportunities-and-risks.html
9. From Technology-Driven Society to Socially Oriented Technology: The Future of
Information Society—Alternatives to Surveillance:
https://www.researchgate.net/publication/247769312_From_Technology-
Driven_Society_to_Socially_Oriented_Technology_The_Future_of_Information_Soci
ety_--_Alternatives_to_Surveillance
10. Big Data Society: Age of Reputation or Age of Discrimination?:
https://www.researchgate.net/publication/300760841_Big_Data_Society_Age_of_Re
putation_or_Age_of_Discrimination
11. Big Data, Privacy, and Trusted Web: What Needs to Be Done:
https://www.researchgate.net/publication/256471351_Big_Data_Privacy_and_Truste
d_Web_What_Needs_to_Be_Done
12. What the Digital Revolution Means for Us:
https://sciencebusiness.net/news/76591/What-the-digital-revolution-means-for-us
13. Creating (“Making”) a Planetary Nervous System as Citizen Web:
http://futurict.blogspot.com/2014/09/creating-making-planetary-nervous.html

Chapters (11)

Introduction—Have We Opened Pandora’s Box?
Chapter
  • Apr 2015
  • Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society
  • pp.1-26
The first of the contributions in this booklet dates back to March 2008, when Markus Christen, James Breiding and myself became concerned about the stability of the financial system that we felt urged to write a newspaper article to alert the public (see the English translation in Chap. 4). Unfortunately, at that time, the public was not ready to listen. Newspaper editors found our analysis too complex. We responded that a financial crisis would be impossible to prevent, if newspapers failed to explain the complexity of problems like this to their audience. Just a few months later, Lehmann Brothers collapsed, which gave rise to a large-scale crisis. It made me think about the root causes of economic problems and of global crises in general (see Chaps. 4, 5, and 7). But my collaborators and I saw not only the financial crisis coming. We also voiced the surveillance problem early on and the political vulnerability of European gas supply. We studied conflict in Israel, the spreading of diseases, and new response strategies to earthquakes and other disasters. Shortly after, all of this turned out to be highly relevant, almost visionary…
Lost Robustness
Chapter
  • Apr 2015
  • Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society
  • pp.27-37
The current financial crisis is the expression of a systemic change that has occurred in the global economy slowly but profoundly during the last few decades. Our thesis results from an analysis of the financial world from the perspective of the theory of complex systems (which describes common features of social, traffic, ecnomic and ecological systems). The key question guiding our analysis is: what properties make the financial system robust, and therefore stable?
How and Why Our Conventional Economic Thinking Causes Global Crises
Chapter
  • Apr 2015
  • Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society
  • pp.39-52
This discussion paper challenges a number of established views of mainstream economic thinking that, from the perspective of complexity science, seem to require a thorough revision. As Albert Einstein pointed out: “We cannot solve our problems with the same kind of thinking that created them.” Therefore, the new perspective offered here might help to identify new solutions to a number of old economic problems.
“Networked Minds” Require a Fundamentally New Kind of Economics
Chapter
  • Apr 2015
  • Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society
  • pp.53-56
In their computer simulations of human evolution, scientists at ETH Zurich find the emergence of the “homo socialis” with “other-regarding” preferences. The results explain some intriguing findings in experimental economics and call for a new economic theory of “networked minds”.
Global Networks Must be Redesigned
Chapter
  • Apr 2015
  • Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society
  • pp.67-73
Todays strongly connected, global networks have produced highly interdependent systems that we have not been able to adequately understand and control. These systems are vulnerable to failure at all scales, posing serious threats to society, even when external shocks are absent. As the complexity and interaction strengths in our networked world increase, man-made systems can become unstable, creating uncontrollable situations even when decision-makers are well-skilled, have all data and technology at their hands, and do their best. To make these systems manageable, a fundamental redesign is needed. A Global Systems Science might create the required knowledge and paradigm shift in thinking.
Big Data—A Powerful New Resource for the Twenty-first Century
Chapter
  • Apr 2015
  • Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society
  • pp.75-81
Information and communication technology (ICT) is the economic sector that is developing most rapidly in the USA and Asia and generates the greatest value added per employee. Big Data—the algorithmic discovery of hidden treasures in large data sets—creates new economic value. The development is increasingly understood as a new technological revolution. Europe could establish itself as data bank and Open Data pioneer and turn into a leading place in the area of information technologies.
Google as God? Opportunities and Risks of the Information Age
Full-text available
Article
  • Apr 2013
If God did not exist - people would invent one. The development of human civilization requires mechanisms promoting cooperation and social order. One of these mechanisms is based on the idea that everything we do is seen and judged by God - bad deeds will be punished, while good ones will be rewarded. The Information Age has now fueled the dream that God-like omniscience and omnipotence can be created by man.
From Technology-Driven Society to Socially Oriented Technology. The Future of Information Society -- Alternatives to Surveillance
Full-text available
Article
  • Jul 2013
Our society is changing. Almost nothing these days works without a computer chip. Computing power doubles every 18 months, and in ten years it will probably exceed the capabilities of a human brain. Computers perform approximately 70 percent of all financial transactions today and IBM's Watson now seems to give better customer advise than some human telephone hotlines. What does this imply for our future society?
Big Data Society: Age of Reputation or Age of Discrimination?
Full-text available
Chapter
  • Apr 2015
  • Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society
  • pp.103-114
If we want Big Data to create societal progress, more transparency and participatory opportunities are needed to avoid discrimination and ensure that they are used in a scientifically sound, trustable, and socially beneficial way.
Big Data, Privacy, and Trusted Web: What Needs to Be Done
File available
Data
  • Sep 2013
This perspective paper discusses challenges and risks of the information age, and the implications for the information and communication technologies that need to be built and operated. It addresses ethical and policy issues related with Big Data and how procedures for privacy-preserving data analyses can be established. It further proposes a concept for a future, self-organising and trusted Web and discusses recommended legal regulations as well as the infrastructure and institutions needed.
Creating (“Making”) a Planetary Nervous System as Citizen Web
Chapter
  • Apr 2015
  • Thinking Ahead - Essays on Big Data, Digital Revolution, and Participatory Market Society
  • pp.189-194
The goal of the Planetary Nervous System is to create an open, public, intelligent software layer on top of the “Internet of Things” as the basic information infrastructure for the emerging digital societies of the twenty-first century.
... Some emphasise the huge economic potential of big data, calling it the "oil of the 21 st century," that is, an enormous resource for innovation, progress, and wealth creation. Others consider big data to be a fundamental threat to freedom and privacy-a demonic instrument of an Orwellian surveillance regime (Helbing 2015). Neither position is nuanced enough, but they reflect the tensions surrounding the ethical, legal, and social issues (ELSI) of big data. ...
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... Some emphasise the huge economic potential of big data, calling it the "oil of the 21 st century," that is, an enormous resource for innovation, progress, and wealth creation. Others consider big data to be a fundamental threat to freedom and privacy-a demonic instrument of an Orwellian surveillance regime (Helbing 2015). Neither position is nuanced enough, but they reflect the tensions surrounding the ethical, legal, and social issues (ELSI) of big data. ...
Ethical, Legal and Social Issues of Big Data - A Comprehensive Overview
Article
Full-text available
  • Jan 2022
The ELSI White Paper is the final achievement of the ELSI Task Force for the National Research Programme “Big Data” (NRP 75). It is an informational document that provides an overview of the key ethical, legal, and social challenges of big data and provides guidance for the collection, use, and sharing of big data. The document aims to bring together the expertise of the ELSI Task Force members rather than exhaustively covering all topics in big data relating to ethical, legal, and social issues (ELSI). The white paper comprises two parts: main articles and commentaries on it. The main articles give an overview of the major concerns associated with the use of big data, based on the assessment of the participating researchers. The commentary articles either examine in depth one or more of the issues that are presented in the main articles or highlight other issues that are considered relevant by their authors but are not covered in the main articles. The main articles are divided into three sections corresponding to the three ELSI levels of analysis. In the section on ethics, Marcello Ienca explores the threat of big data to ethics commissions, privacy rights, personal autonomy, and equality in the healthcare sector and biomedical research. Bernice Elger focuses on the need to address informed consent differently and complement it with additional mechanisms in the big data context. In the legal section, Christophe Schneble explores whether current Swiss data protection laws adequately regulate and protect individuals’ data. Eleonora Viganò analyses the threat of big data to state sovereignty and explore the two contrasting acceptations of the term “digital sovereignty” in the context of big data. In the section on social issues, Markus Christen addresses the big data divide, namely, the uneven distribution of benefits and harms from big data and the connected issue of the transparency asymmetry between data givers and data owners. Michele Loi delves into the debate on fair algorithms, presenting the risks of discriminating against certain groups when adopting big data-based predictive algorithms, such as those for predicting inmates’ recidivism. The second part of the ELSI White Paper contains three commentaries. In the first, Mira Burri focuses on the viability of new approaches to global trade governance that seek to address big data issues and makes recommendations for a better informed and more proactive Swiss approach. In the second commentary, David Shaw explores the lack of protection for vulnerable groups in big data research and the temporospatial and moral distance between researchers and participants that increases the risk of exploitation. In the third commentary, Christian Hauser tackles big data from the perspective of business ethics and provides guidance to companies employing big data. Keywords: Big data, informed consent, data protection law, big data divide, digital sovereignty, health data, discrimination, big data research, big data in industry JEL Classification: O3, F13
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... Fourcade and Healy 2013, O'Neil 2016, Adolf and Stehr 2018, p. 1254, Zuboff 2019). More optimistic arguments consider big data a possible tool for developing a 'participatory market society' (Helbing 2015), 'radical markets and democracy' (Posner and Weyl 2018) or for reinventing 'capitalism and democratic consumerism' (Mayer-Schönberger and Ramge 2018). Some studies have suggested that a 'post-neoliberal' or even 'cyber-socialist' formation may emerge from certain applications, for instance, social network analytics or real-time corporate planning and supply-chain management (Davies 2015, Limas 2018, Phillips and Rozworski 2019. ...
Karl Polanyi’s ‘socialist accounting’ and ‘overview’ in the age of data analytics
Article
Full-text available
  • Jul 2022
Digital capitalism’s information infrastructure is the subject of contentious debates concerning its transformative effects on the political economy and society. A frequent proposition, referring to older arguments of the ‘socialist calculation debate’, is that with big data analytics the pro-market arguments of neoliberal economists such as Hayek or Mises become obsolete. This article critically examines this proposition by drawing on Karl Polanyi’s notion of overview; a core theme in his outlines of a socialist economy and accounting written in the 1920s. In these contributions to the early Austrian socialist calculation debate, Polanyi discusses how to gain knowledge of the economic and social processes in such a way that the economy can be democratically governed according to its socialist aims and purposes. This article highlights the relevance of Polanyi’s work on socialist accounting, along with his later perspectives on technology and on social scientific method, for reflecting upon data- and algorithm-driven economic governance. Polanyi’s critical analysis of abstraction effected through methods of knowing suggests a sceptical stance vis-à-vis current versions of technological ‘solutionism’, which places its faith in data and algorithms as tools for economic and social, or socialist, planning.
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DISCUSSING COMMUNICATION THROUGH DIGITALIZATION
Conference Paper
Full-text available
  • Nov 2022
ABSTRACT Technique and technology reveal the level of humanity in the current century. 'Smart' technology seems to have infiltrated every moment and area of human life as an extension of digital structures. Through computer-based technologies, the individual produces, copies, records, presents and transforms data. In addition to the fact that machines are smarter in digital life, their fast and integrated structure both enables and encourages content production in digital environments. Interfaces used on a network establish relationships between texts and develop the perception that they have the power to interfere with the content they are exposed to. The individual of today's world strives to be 'visible' in virtual environments with 'digital' activities and states of effectiveness, and within this framework, he leaves footprints on the network. In addition to providing time and space flexibility, the digital one also increases the individual's desire for 'watching' and 'surveillance' action. When the mass data, the willingness to access this data, the feeling of losing a lot when it is not in the virtual environment, and the developing tendencies towards the virtual in the individual, such as surveillance, are considered in the context of big data and its usage areas, information is very important for both individuals and companies. Social life styles that are rapidly transformed (generated) through digitalization gain fluid and flexible appearances. The control of societies for security purposes is becoming the most important project of the future, and the predictive inquiry, estimation and inspection process of the surveillance mechanism reinforces the understanding of the control society. Key Words: Communication, Digitalization, Technology, Compunity, Society.
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Citizenship in Times of Crises -Crisis of Citizenship?
Preprint
  • Sep 2022
The article discusses recent developments that are impacting the understandings of citizenship in late modern societies. During the past decades, citizenship has been discussed in terms of its contributions to tackling effects of political, social and economic crises. Most prominent are those challenges deriving from processes of Europeanization and globalization, but also, digital technologies are said to impinge new requirements on individuals, thus calling for European, global or digital citizenship. Well beyond simply changing the traditional orientation towards a nation-state, new conceptualizations of citizenship gravitate heavily towards individual dispositions and subjective competencies, while legal-juridical features remain untouched and largely unrelated. This explains the strong emphasis on the role of education in cultivating-global, European, digital-citizenship among individuals. The contribution asks whether and if so, how changed understandings of citizenship may lead to 'performative citizenship', where individuals are burdened with the requirement of constantly enacting 'good' and 'worthy' citizenship. The paper is organized along three sections: First, we revisit the mainstream literature on citizenship and discuss the main elements in historical-systematic manner. Second, based on a thorough literature review we discuss recent developments that call for updated meanings and representations of citizenship, before, third, the paper deliberates on the performative nature on newer conceptions of citizenship by examining recent examples of so-called global universities. The article closes with a discussion of research avenues for the topic, including crucial questions as to the status, role and function of citizenship in times of crises.
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Digital Mechanisms of Management System Optimization in the Forest Industry
Chapter
  • Apr 2022
This chapter discusses digital mechanisms for optimizing the management system in the forest industry, which includes organizational, legal, socio-economic, and environmental aspects. Efficient forest management is considered as an integral part of efficient nature management and includes the use of forest resources, their protection, and reproduction of forests. Digital management mechanisms in forest management in general and in the forest industry in particular are based on platform solutions. Platform solutions are based on the formation and processing of data on the basis of a single automated information system, which acts as the foundation for the development of digitalization in forestry. Such a digital platform is designed to provide informational, analytical, consulting, and other support to the activities of all subjects of relations in the field of use, conservation, protection, and reproduction of forest resources.
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Knowledge work in the age of control: capitalising on human capital
Article
Full-text available
  • Jan 2022
The main claim that I aim to substantiate in this article is that power in the form of control is exerted in a more insidious manner now that knowledge work has become 'networked'. To this end, I first describe societal control in the current epoch. Given the fact that my focus is on knowledge work, I next revisit the human capital literature with the aim of coming to a more precise understanding of what knowledge work is. The literature on "leveraging human capital" (Burud and Tumolo 2004) evidences how human capital theory draws on the conditions of free-floating control to optimally capitalise on knowledge workers. Models of overt management have come to be replaced by more expansive and insidious models of control that extend beyond the sphere of work into the intimate recesses of private life. Control operative at the societal level (Castells 1996) extends beyond the macro-level (neoliberal), to the meso-level (organisational), and the microlevel (self-governance). Next, I critically consider the implications of these conditions of control for the (self-)governance of the knowledge worker by drawing on Han's (2017) further specification of control as "smart power". I come to the conclusion that under the conditions of apparently greater autonomy and discretion that is so pervasive in the management literature discussing knowledge workers, governance as "control" induces constant work erasing the boundaries between work and private life. Neoliberalism with its mantra of investment in human capital has succeeded in producing an optimally efficient, ever-working subject. Throughout my analyses are informed by Foucault's (2008) concept of "governmentality", which fuses the presiding rationality (knowledge) with governance (power as control) to throw light on how human conduct is being conducted (orchestrated) for optimal efficiency.
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Artificial intelligence in the field of economics
Article
Full-text available
  • Mar 2022
The history of AI in economics is long and winding, much the same as the evolving field of AI itself. Economists have engaged with AI since its beginnings, albeit in varying degrees and with changing focus across time and places. In this study, we have explored the diffusion of AI and different AI methods (e.g., machine learning, deep learning, neural networks, expert systems, knowledge-based systems) through and within economic subfields, taking a scientometrics approach. In particular, we centre our accompanying discussion of AI in economics around the problems of economic calculation and social planning as proposed by Hayek. To map the history of AI within and between economic sub-fields, we construct two datasets containing bibliometrics information of economics papers based on search query results from the Scopus database and the EconPapers (and IDEAs/RePEc) repository. We present descriptive results that map the use and discussion of AI in economics over time, place, and subfield. In doing so, we also characterise the authors and affiliations of those engaging with AI in economics. Additionally, we find positive correlations between quality of institutional affiliation and engagement with or focus on AI in economics and negative correlations between the Human Development Index and share of learning-based AI papers.
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Evolutionary instability of Zero Determinant strategies demonstrates that winning isn't everything
Article
Full-text available
  • Aug 2013
Zero-determinant strategies are a new class of probabilistic and conditional strategies that are able to unilaterally set the expected payoff of an opponent in iterated plays of the Prisoner's Dilemma irrespective of the opponent's strategy (coercive strategies), or else to set the ratio between the player's and their opponent's expected payoff (extortionate strategies). Here we show that zero-determinant strategies are at most weakly dominant, are not evolutionarily stable, and will instead evolve into less coercive strategies. We show that zero-determinant strategies with an informational advantage over other players that allows them to recognize each other can be evolutionarily stable (and able to exploit other players). However, such an advantage is bound to be short-lived as opposing strategies evolve to counteract the recognition.
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Dynamic Decision Behavior and Optimal Guidance Through Information Services: Models and Experiments
Article
Full-text available
  • Jan 2007
In this contribution, dynamical models for decision making with and with- out temporal constraints are developed and applied to opinion formation, migration, game theory, the self-organization of behavioral conventions, etc. These models take into account the non-transitive and probabilistic aspects of decisions, i.e. they re∞ect the observation that individuals do not always take the decision with the highest utility or payofi. We will also discuss issues like the freedom of decision making, the red-bus- blue-bus problem, and efiects of pair interactions such as the transition from individual to mass behavior. In the second part, the theory is compared with recent results of experimental games relevant to the route choice behavior of drivers. The adaptivity (\group intelli- gence") with respect to changing environmental conditions and unreliable information is very astonishing. Nevertheless, we flnd an intermittent dynamical reaction to ag- gregate information similar to volatility clustering in stock market data, which leads to considerable losses in the average payofis. It turns out that the decision behavior is not just driven by the potential gains in payofis. To understand these flndings, one has to consider reinforcement learning, which can also explain the empirically observed emergence of individual response patterns. Our results are highly signiflcant for pre- dicting decision behavior and reaching the optimal distribution of behaviors by means of decision support systems. These results are practically relevant for any information service provider.
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How Natural Selection Can Create Both Self- and Other-Regarding Preferences, and Networked Minds
Article
Full-text available
  • Mar 2013
Biological competition is widely believed to result in the evolution of selfish preferences. The related concept of the 'homo economicus' is at the core of mainstream economics. However, there is also experimental and empirical evidence for other-regarding preferences. Here we present a theory that explains both, self-regarding and other-regarding preferences. Assuming conditions promoting non-cooperative behaviour, we demonstrate that intergenerational migration determines whether evolutionary competition results in a 'homo economicus' (showing self-regarding preferences) or a 'homo socialis' (having other-regarding preferences). Our model assumes spatially interacting agents playing prisoner's dilemmas, who inherit a trait determining 'friendliness', but mutations tend to undermine it. Reproduction is ruled by fitness-based selection without a cultural modification of reproduction rates. Our model calls for a complementary economic theory for 'networked minds' (the 'homo socialis') and lays the foundations for an evolutionarily grounded theory of other-regarding agents, explaining individually different utility functions as well as conditional cooperation.
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FuturICT - The road towards ethical ICT
Article
Full-text available
The pervasive use of information and communication technology (ICT) in modern societies enables countless opportunities for individuals, institutions, businesses and scientists, but also raises difficult ethical and social problems. In particular, ICT helped to make societies more complex and thus harder to understand, which impedes social and political interventions to avoid harm and to increase the common good. To overcome this obstacle, the large-scale EU flagship proposal FuturICT intends to create a platform for accessing global human knowledge as a public good and instruments to increase our understanding of the information society by making use of ICT-based research. In this contribution, we outline the ethical justification for such an endeavor. We argue that the ethical issues raised by FuturICT research projects overlap substantially with many of the known ethical problems emerging from ICT use in general. By referring to the notion of Value Sensitive Design, we show for the example of privacy how this core value of responsible ICT can be protected in pursuing research in the framework of FuturICT. In addition, we discuss further ethical issues and outline the institutional design of FuturICT allowing to address them. Graphical abstract
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Accelerating Scientific Discovery by Formulating Grand Scientific Challenges
Article
Full-text available
  • Aug 2012
One important question for science and society is how to best promote scientific progress. Inspired by the great success of Hilbert's famous set of problems, the FuturICT project tries to stimulate and focus the efforts of many scientists by formulating Grand Challenges, i.e. a set of fundamental, relevant and hardly solvable scientific questions.
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Buyers pay for and sellers invest in a good reputation: More evidence from eBay
Article
This article contributes to the research on trust and reputation formation in anonymous online markets. I first give a formal account of the reputation mechanism in anonymous online markets and derive testable hypotheses. Based on the analysis of a large set of process data (N ≈ 176,000), I corroborate a statistically and economically significant seller reputation effect on the probability of sale and the selling price both in auctions and fixed price offers. Moreover, my analysis shows that sellers making fixed price offers invest in a good reputation to a similar extent as buyers pay for it in auctions. Finally, I obtain repeated observations on a considerable subset of the buyer population by including highest non-winning bids in the analysis and show that buyers trade off sellers’ reputations and prices within the set of offered items they choose to bid on. My findings provide further evidence that reputation systems solve trust problems and reduce transaction costs in anonymous online markets by providing incentives for traders’ cooperative behavior.
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Who Will Pay for Public Access to Research Data?
Article
When economic models and infrastructure are not in place to ensure access and preservation, federally funded research data are "at risk.".
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Economics 2.0: The Natural Step towards A Self-Regulating, Participatory Market Society
Article
  • May 2013
Despite all our great advances in science, technology and financial innovations, many societies today are struggling with a financial, economic and public spending crisis, over-regulation, and mass unemployment, as well as lack of sustainability and innovation. Can we still rely on conventional economic thinking or do we need a new approach? I argue that, as the complexity of socio-economic systems increases, networked decision-making and bottom-up self-regulation will be more and more important features. It will be explained why, besides the "homo economicus" with strictly self-regarding preferences, natural selection has also created a "homo socialis" with other-regarding preferences. While the "homo economicus" optimizes the own prospects in separation, the decisions of the "homo socialis" are self-determined, but interconnected, a fact that may be characterized by the term "networked minds". Notably, the "homo socialis" manages to earn higher payoffs than the "homo economicus". I show that the "homo economicus" and the "homo socialis" imply a different kind of dynamics and distinct aggregate outcomes. Therefore, next to the traditional economics for the "homo economicus" ("economics 1.0"), a complementary theory must be developed for the "homo socialis". This economic theory might be called "economics 2.0" or "socionomics". The names are justified, because the Web 2.0 is currently promoting a transition to a new market organization, which benefits from social media platforms and could be characterized as "participatory market society". To thrive, the "homo socialis" requires suitable institutional settings such a particular kinds of reputation systems, which will be sketched in this paper. I also propose a new kind of money, so-called "qualified money", which may overcome some of the problems of our current financial system.
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Preferencing, Internalization of Order Flow, and Tacit Collusion: Evidence from Experiments
Article
This paper examines preferencing arrangements and tacit collusion in laboratory asset markets. In the experiments, dealers may internalize by matching the best quote or by passing orders to the dealer posting the best quote. Although some markets were highly competitive, several markets reached a collusive equilibrium with wide spreads and near complete internalization of order flow. The paper further examines the role of market transparency and passed order flow on quote-setting behavior and suggests that these affect the mechanism leading to tacitly collusive equilibria.
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