18 October 2015

How many Economies ?!

Recently we are witnessing a great “creativity” in coining economy definitions and models. Examples are: Sharing economy, Circular Economy, Access Economy, Data driven Economy, Digital Economy, Information Economy, API Economy, Platforms Economy, Creative Economy… and many others.

Well, maybe we can add here another one, another buzzword: the Softwarization Economy where "software is eating the world" ! But this is not the key point.

This looks like the story of the blind men and the elephant, a tale coming from India. A group of blind men touch an elephant to learn what it is like. Each one feels a different part, but only one part. They then compare notes and argue that they are talking about different things. But this not the case.

That’s the same for the mentioned definitions of economies: distinctions without differences, again.

My take is that it’s a simpler story: just look at telecommunications and ICT which are going to become accessible at low cost to Users and enterprises in any part of the world, almost on an equal basis. As a result of the consequent mass digitalization, it is becoming possible (through horizontal platforms and marketplaces) to optimize the use/share of any resources, and even to automate any process of the Society and the Economy. Simply as humans, we have a new "tool" to adapt and to change the environment.

This is the elephant, at the end of the day: an hyper-connected world where telecommunications and ICT are so mature to “morph” the space-time dimensions of reality by automating and optimising any process. All the above X-economy are expressions of this same transformation.

And out of this transformation, robots and autonomous machines are likely to replace humans in several jobs and professions. This, in fact, will bring optimizations and costs reductions. The most expensive costs in a production environment are coming from humans.

So, it is easy to forecast this unstoppable transformation: unavoidably, any large scale ecosystem sooner or later will move from a state with higher energy (i.e., higher cost) to a state with lower energy (i.e., lower cost); local minima are usually related to the stable stationary states.

It’s adaptation by solving constrained optimization problems, as in Nature.
The law driving the electrons current in a circuit and steering the emergent behaviors of a beehive.

The obvious question is: what’s left to humans in the future ?
A point of discontinuity is ahead of us: the Quantum leap.