Geography as destiny

I just read Enrico Moretti’s (2012) The New Geography of Jobs, having not done so before now because I’d read quite a lot of his papers. Anyway, now I have and it’s very good. It’s a nicely accessible survey of the literatures on trade/tech and jobs, and on the geographic aspect – the concentration of skilled people in cities and growing divergence. The evidence it cites is entirely US-centric but the drivers obviously apply elsewhere, even though their effects in other countries are not exacerbated by the  unattractive features of US society. So I would recommend this to anybody who would like a readable big-picture overview of what has been happening to jobs and incomes in recent decades. The major irritation is that the notes aren’t flagged in the text & you just have to root around at the back of the book to see if a given statement has a reference attached to it.

The conclusions are a little bleak in terms of policies to address the growing divergence between rich skilled places and the left-behinds.Being in the right place matters. There are spillovers between people, so even as a graduate you do better in terms of earnings the more other skilled people are around you, but non-graduate occupations also have higher earnings in high skill places.

Overcoming the gaps requires a Big Push, the book concludes (I like this allusion to Rosenstein-Rodin, although that literature doesn’t seem to be cited here). Only governments can do these, given the amount of co-ordination involved. Many interventions are just too small scale to have a hope. Looking at the Big Push of the Tennessee Valley Authority, Moretti and his colleagues concluded it was successful in raising productivity in the region but not wages, because the labour supply increased as workers moved in from elsewhere. However, a couple of pages later, he points out that the prominent successful clusters of today did not come about because of a Big Push. Most were organic developments, albeit aided of course by government investment in R&D or defence – see Margaret O’Mara’s book The Code on Silicon Valley which I described in the previous post.

So this is rather sobering. My hunch is that policies will need to rest on a better understanding of the relationships between human capital investments (a college degree is the key variable seemingly driving so many outcomes from earnings to voting pattern to subjectove well-being), social spillovers, intangible assets, amenities including nature and housing, and produced capital especially communications infrastructure. In other words, what assets are there available to people living in in a given place, and to what extent do these complement and substitute for each other?

Anyway, I enjoyed the book even if it left me feeling a bit glum.

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Holiday reading

I’ve spent the past few weeks absorbed in preparing a book manuscript (out next year I hope…), so here is an all-in-one round-up of recent books read (non-fiction – a few Maigrets and also Smoke and Ashes by Abhir Mukherjee slipped in too).

Uncanny Valley by Anna Weiner is a readable memoir of a young non-tech woman’s experience of moving from the publishing industry in New York to marketing in Silicon Valley. Her account confirms expectations & she seems to me to capture that tech world culture pretty well. The book doesn’t name names of companies (or people) but describes them well enough that it’s clear who they are – which is a bit annoying. Other than that, I enjoyed it.

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Twilight of Democracy by Anne Applebaum is a terrific book, also with elements of memoir (the subtitle explains – the parting of friends). It’s a short account of how the respectable right in a number of countries – Poland, Hungary, US, UK – turned into the authoritarian-heading-toward-fascism right. She essentially tells a tale of second-rate people grabbing opportunities to dethrone those at the top – “the elite” – so they can enjoy the spoils themselves. Looking at the US in the days since I read this book, it’s hard to feel any optimism about where it’s heading. As for us, ominshambles with menaces seems to have become a constant.

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96,196 Words: Essays by Emmanuel Carrere. A random purchase – I’d never heard of this French journalist. Perfectly readable essays, albeit with more about his sex life than I was really interested in.

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The Code by Margaret O’Mara is a terrific history of Silicon Valley exploring the reasons tech happened there, having started much stronger around Boston. If you’ve read a lot of history of tech (I have) some bits of this are very familiar. But she puts together a persuasive story of how several factors combine – happenstance, Stanford’s presence, defence spending helping other local firms like Lockheed, a few investors to seed the VC scene, and networks of people who know people developing and becoming embedded over time. It thoroughly undermines the idea that any one intervention – set a mission! create a DARPA! – will create an extraordinary burst of innovation. It’s a much more contingent story.

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And non-economics books: Diary of a Young Naturalist by Dara McAnulty and House of Glass by Hadley Freeman.

Of all of these, the Applebaum and O’Mara books would be my top recommendations.

 

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Law and technology, power and truth

I’d been looking forward to reading Between Truth and Power: The Legal Constructions of Informational Capitalism by Julie Cohen. I start out sympathetic to the key argument that the legal system is the product its society – the material economic and technological and also the political conditions. Therefore current legal contests reflect underlying changes in these same forces, and the final legal system for the digital era is still in the process of being shaped. Law and the implementation of technologies in society influence each other – the ‘rules of the game’ are not exogenous.

There are indeed some interesting insights in the book. I most enjoyed some of the earlier parts, which are more descriptive of the extension of the idea of intangibles, ideas, as “intellectual property”. This is not new – James Boyle for one has written superbly about it. But the detail here is interesting, plenty of nuggets about the US legal system and how truly, gobsmackingly awful it can be.

I also appreciated the chapter on regulation, and its basic point that many regulators are now having to “move into the software auditing business”, and indeed may have to evaluate software controls designed to evade regulation. Implications here for analysing regulation in the digital economy in terms of hyper-asymmetric information and algorithmic complexity.

On the whole though, I was disappointed. The book is almost entirely US focused – and is upfront about it – but the US system is distinctive even compared to other common law jurisdictions. Nowhere else, for instance, has its 1st Amendment fetishism. It would have been terrific to have some reflections on the extra-territoriality of US lawmaking and court judgements in the digital domain.

The book has some tantalising reflections about the limitations of law, based on concepts of individual rights, in the face of collective effects: as I’ve been arguing for a while eg here, digital power spells the end of individualism, including what we all now call the neoliberalism that gave birth to it. More on this would have been great.

There’s also just too much sub-Zuboffian rhetoric (rather than argument) about the ‘surveillance-industrial complex’. I’m all too willing to believe this exists, so all the more disappointed when the analysis is so vague. There’s also a lot of allusion to Foucault – “biopolitics”, “governmentality” –  in the book without it ever – as far as I spotted – actually citing and deploying The Birth of Biopolitics.

All in all, there’s a lot of detail in this book that didn’t, at least for me, cohere. Too many trees, not enough overview of the wood. Perhaps it’s time for me to try the highly-praised The Code of Capital by Katarina Pistor.

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Chaos, tools and thoughts

It has been unsurprisingly hard to concentrate this week, but I did finish Everyday Chaos: Technology, Complexity and How We’re Thriving in a New World of Possibility by David Weinberger. Publishers love thise long subtitles and with one so long you might think there was no need to read the book. This one does the author a disservice. The book is nothing like the giddy Silicon Valley techno-optimistic tract it seems to indicate (and how badly that would have dated in current circumstances). I’d bill it as a follow-up to two much earlier books – The Cluetrain Manifesto of 2000 (of which Weinberger was a co-author) and Kevin Kelly’s 1992 Out of Control.

Everyday Chaos is concerned with the implications of AI everywhere and the always-on internet. It’s broad hypothesis is that the business environment and world more broadly need to take complexity seriously: “At last we are moving from Chaos Theory to chaos practice.” (Chaos Theory being the flapping butterfly in one place causing a hurricane across the world thanks to the non-linear complex dynamics of weather systems.) That means expecting small interventions to sometimes have huge consequences. It implies organisations need to be ‘agile’ (ie flexible), open, less hung up on causality and more willing to live with (shifting) correlations.

It’s particularly interesting on the flexibility of the concept of interoperability, which can be made to build bridges between organisations in different ways. The book advocates a “networked, permeable” view of business rather than the hard boundaries we are used to thinking about. “The knocking down of old walls that were definitional of a business is better understood as a strategic and purposive commitment to increasing a business’s interoperability with the rest of the environment.” Rather than narrowing down to a small number of strategic options, Weinberger’s advice is: “In an interoperable world in which everything affects everything else, the strategic path forward may be to open as many paths as possible.”

The book also reminded me about the very interesting work by Andy Clark and his argument that our tools – pen and paper, whiteboard, screen, spreadsheet – determine how we think (this is a terrific New Yorker profile and here’s a famous paper with Dave Chalmers on the ‘extended mind’). Knowledge is a function of what’s outside our heads. As Weinberger concludes, we are neither an effect of thing (technodeterminism) or nor to we straightforwardly cause things. new tools – machine learning – will end up with us understanding the world in a different way.

Everyday Chaos is also really well written and engaging, so it’s well worth ignoring the airport bookshop packaging. Not that there will be many chances to buy in airport bookstores for quite a while…

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Tech self-governance

The question of how to govern and regulate new technologies has long interested me, including in the context of a Bennett Institute and Open Data Institute report on the (social welfare) value of data, which we’ll be publishing in a few days’ time. One of the pressing issues in order to crystallise the positive spillovers from data (and so much of the attention in public debate only focuses on the negative spillovers) is the development of trustworthy institutions to handle access rights. We’re going to be doing more work on the governance of technologies, taking a historical perspective – more on that another time.

Anyway, this interest made me delighted to learn – chatting to him at the annual TSE digital conference – that Stephen Maurer had recently published Self-governance in Science: Community-Based Strategies for Managing Dangerous Knowledge. It’s terrifically interesting & I recommend it to anyone interested in this area.

The book looks at two areas, commerce and academic research, in two ways: historical case study examples; and economic theory. There are examples of success and of failure in both commercial and academic worlds, and the economic models summarise the characteristics that explain whether or not self-governance can be sustained.

So for instance in the commercial world, food safety and sustainable fisheries standards have been adopted and largely maintained largely through private governance initiatives and mechanisms, synthetic biology much less so, having an alphabet soup of competing standards. Competitive markets are not well able to sustain private standards, Maurer suggests: “Competitive markets can only address problems where society has previously addressed some price tag to the issue.” Externalities do not carry these price tags. Hence supply chains with anchor firms are better able to bear the costs of compliance with standards – the big purchasing firm can require its suppliers to adhere.

Similarly, in the case of academic science the issue is whether there are viable mechanisms to force dissenting minorities to adhere to standards such as moratoria on certain kinds of research. The case studies suggest it is actually harder to bring about self-governance in scientific research as there are weaker sanctions than the financial ones at play in the commercial world. Success hinges on the community having a high level of mutual trust, and sometimes on the threat of formal government regulation. The book offers some useful strategies for scientific self-governance such as building coalitions of the willing over time (small p politics), and co-opting the editors of significant journals – as the race to publish first is so often the reason for the failure of research moratoria to last.

The one element I thought was largely missing from the analytical sections was the extent to which the character of the technologies or goods themselves affect the likelihood of successful self-governance. This is one aspect that has come up in our preparatory work – the cost and accessibility of different production technologies. The analysis here focuses on the costs of implementing standards, and on monitoring and enforcement.

This is a fascinating book, including the case studies, which range from atomic physics to fair trade coffee. It isn’t intended to be a practical guide (& the title is hardly the airport bookstore variety) but anybody interested in raising standards in supply chains or finding ways to manage the deployment of new technologies will find a lot of useful insights here.

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