The link between computation asymmetry and openness

by Sebastian Benthall

I want to jot something down while it is on my mind. It’s rather speculative, but may wind up being the theme of my thesis work.

I’ve written here about computational asymmetry in the economy. The idea is that when different agents are endowed with different capacity to compute (or are differently boundedly rational)), then that can become an extreme inequality (power law distributed, as is income) as computational power is stockpiled as a kind of capital accumulation.

Whereas a solution to unequal income is redistribution and a solution to unequal physical is regulation against violence, for computational asymmetry there is a simpler solution: “openness” in the products of computation. In particular, high quality data goods–data that is computationally rich (has more logical depth)–can be made available as public goods.

There are several challenges to this idea. One is the problem of funding. How do you encourage the production of costly public goods? The classic answer is state funding. Today we have another viable option, crowdfunding.

Another involves questions of security and privacy. Can a policy of ‘openness’ lead to problematic invasions of privacy? Viewing the problem in light of computational assymetry sheds light into this dynamic. Privacy should be a privilege of the disempowered, openness a requirement of the powerful.

In an ideal economy, agents are rewarded for their contribution to social welfare. For high quality data goods, openness leads to the maximum social welfare. So in theory, agents should be willingly adopting an open policy of their own volition. What has prevented them in the past is transactions costs and the problem of incurred risk. As institutions that reduce transaction costs and absorb risks get better, the remaining problems will be ones of regulation of noncompetitive practices.