You Are Being Exploited By The Opaque, Algorithm-Driven Economy

Is internet shopping like The Truman Show–a movie about a man who thinks himself free, but whose life is actually controlled by a TV producer? Are we online consumers like Truman Burbank, hopelessly and blissfully naive while titanic companies control our fate? Are the prices we pay online a function of a competitive market, or are our choices framed in ways we don’t quite fathom? These provocative questions are posed in a fascinating book about how platform internet companies (Amazon, Facebook, and so on) are changing the norms of economic competition. Virtual Competition: The Promise and Perils of the Algorithm-Driven Economy argues that these companies, with their immense data advantage, are effectively making their own rules in the marketplace, beating back new market entrants, and disadvantaging customers. As the internet took off in the 1990s, it was said, by some dreamy-eyed commentators, to be a giant-killing, democratic medium–a sort of anti-Walmart. You could start a business from your bedroom. You could win a $100 million in venture capital while still in your bathrobe. The internet was to emancipate commerce and to embody Adam Smith’s “invisible hand”–the beneficial, and mutual, economic effect that comes from people acting aggressively in their own self-interest. “We have no idea about how, and the extent to which, we are being exploited.” [Photo: © 1998 Paramount Pictures/IMDB]In Virtual Competition, economists Ariel Ezrachi and Maurice Stucke document the... Continue reading at 'Fast Company'

[ Fast Company | 2017-08-04 00:00:00 UTC ]

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You Are Being Exploited By The Opaque, Algorithm-Driven Economy

Is internet shopping like The Truman Show–a movie about a man who thinks himself free, but whose life is actually controlled by a TV producer? Are we online consumers like Truman Burbank, hopelessly and blissfully naive while titanic companies control our fate? Are the prices we pay online a... Continue reading at Fast Company

[ Fast Company | 2017-08-04 00:00:00 UTC ]
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