What Is “Digital Capitalism?” - Part 2

 ■What Is “Digital Capitalism?” - Part 2

The first point was

1. The significance of consumer surplus and total surplus

Now I would like to touch on

2. Capitalism will be modified to become a data-driven, knowledge-producing society

2. The Modification of Capitalism

This book explains that the sharing economy can advance the conversion of goods into services, reduce producer surplus, and shrink the economy and that it tends to inhibit employment and investment.

I agree with this sentiment. It would be dangerous to capture the sharing economy within the context of growth strategies, and I believe that it should be promoted from the perspective of enhancing welfare and consumer surplus.

All activities in the economies represented by the sharing economy are online- and data-driven.

This means that society based on “labor productivity,” in which the input for added value is labor, will turn into a society based on “knowledge productivity,” in which the input for added value is data.

This book envisions this form of “digital capitalism.”

Currently, there are 8 billion IoT devices working together, but this number will increase by 50 billion by 2020, and the amount of information being produced in 1 year will be produced in 1 hour.

Naturally, this will change the state of socioeconomics fundamentally.

The socioeconomics with AI tied in will most likely be drastically modified also.

This book imagines that this technology-driven future will have various forms depending on the country and region.

This is a view in which the economy, society, and history are local.

I have no doubt that Japan will consume technology and construct society in its own way. It has been this way in the past.

What concerns me is the explanation that the reasons behind the current long-term stagnation across the globe can be traced to the lack of innovation.

The reasoning is that innovation in the 21st century is relatively small compared to inventions in the 20th century, such as electricity, airplanes, automobiles, and household electronics, and there is less low-hanging fruit compared to the past when there was uncolonized land and uneducated children.

I believe that opinion will be divided depending on how substantial the impact of IT and AI is assessed to be.

I believe that innovation in the 21st century has just gotten started, and its effects will begin to be seen as it is consumed. Moving forward, humankind will change its make-up and reach digital capitalism as covered in this book

This book presents 3 future outcomes, which are 1. capitalism will end, 2. industrial capitalism will reach a higher level (industry 4.0), and 3. a new type of capitalism, in which digital information is the source of value creation, will be born, and supports hypothesis 3.

I feel the same way, or rather that it would be interesting for that to happen. I am not certain of this.

However, I thought that the analysis that the “forced marriage” between capitalism, for which disparity is an essential quality, and democracy, which is based on equality, will be dissolved is rough. The fact that globalization, which is the frame for capitalism in the United States and the United Kingdom, has been denied by democracy points to the fact that we have entered a situation that requires a new agreement between capitalism and politics.

This book suggests that digital factors can serve as the mediator that finds balance between capitalism and democracy.

Digital technologies that modify capitalism will also modify the relationship between politics and the public, starting with socialization. It would be beneficial for this to lead to harmony between all parties.

However, this cannot be seen tangibly at the moment and is nothing more than a desire.

While analyzing the economy, this book indicates that humankind has yet to fully grasp the effect of the advancement and maturation of digitalization, which has a historically significant impact.