How innovation makes us more equal.

AuthorMcGinnis, John O.
PositionThirty-Fourth Annual Federalist Society National Student Symposium

Inequality is said by many of our leading thinkers to be the defining issue of our time. Often, the reason given for the increase in inequality is located in innovation itself. Under this view, technology disproportionately increases the incomes of those who can take advantage of it, helping the one percent more than anyone else. (1) It also threatens the jobs of the less skilled. In my view, however, modern innovation ultimately helps reduce real inequality, certainly globally, and even within the United States. And it does so for fundamental, not contingent, reasons.

Information technology changes the world by using information to better deploy material resources. Because of the nature of our accelerating technology, that information rapidly becomes common property, benefiting everyone. Modern information technology dematerializes the world and thus democratizes it. Material resources are ultimately finite, but functionality of technology is not. The move from "its" to "bits" is thus a move to equality, and so is the acceleration of change because that acceleration rapidly pushes down the cost of previous innovations. Economic value is increasingly created not by material things but by the information from our accelerating technology that arranges the material. Information can be shared equally in ways that material goods cannot.

This means that our circumstances are more equal than conventional income measures would suggest. (2) To the extent that inequality should be addressed by policy, acknowledging these observations will help us draft more promising solutions, policies designed to increase innovation, and improvements to education rather than simply transfer resources from one group to another.

  1. OUR DEMATERIALIZING, ACCELERATING TECHNOLOGY

    Thomas Jefferson once said, "He who receives an idea from me receives instruction himself without lessening mine; as he who lights his taper at mine receives light without darkening me." (3) In the Information Age, we enjoy an ever-greater access to an ever-brighter light that generates more value and consumption for all--substantially tempering the effect of technology's differential boost on incomes. (4) The accelerating pace of technological change drives down the cost of these information-based products, sometimes so far that they decrease to zero. (5)

    What is the driving force of technology and its acceleration today? It is largely information technology and computation. (6) Moore's Law is part of a long-term growth in computation. (7) Electromechanical methods began the push for enhanced computation more than a century ago. (8) They were replaced by vacuum tubes, which were surpassed by transistors, which gave way to today's integrated circuit. (9) Other methods under research today, from optical computing to nanotubes, are likely to be responsible for continued growth. (10) This dramatic increase in hardware capacity is only part of the story. Software has been improving apace as well. (11) This interconnectivity by the Internet brings machines closer together, and this accelerating power in hardware, software, and connectivity relentlessly transforms economic sectors. (12)

    In artificial intelligence's most recent trial, Watson, the IBM machine, beat the best Jeopardy! players in the world. (13) This reflects advances in all those areas. The computer disentangled humor, recognized puns, and resolved ambiguity. Unlike its predecessor, Big Blue, which defeated the world chess champion fifteen years earlier, Watson succeeded in a less-precisely rule-driven game--one much more like the chaotic world we inhabit. (14) This fluidity enables computing applications in an increasing number of areas. Watson is going into medical diagnostics, (15) and these diagnostic programs will level the standard of health care, making the rich's access to the best doctors relatively less valuable than it was before. (16) The story of machine intelligence and its ability to level up is always the same: once it gains a foothold, it improves until it dominates. (17)

    If lawyers or law students think that they are immune to the leveling of the computational revolution, they are very mistaken. The work that junior associates once did--sorting documents for instance--is now going to machines. (18) Computers can sort better than people because fatigue, boredom, and distraction reduce human accuracy. Machine intelligence, in contrast, works nonstop without caffeine or sleep. For many lawyers this may not be such a good result, but for legal consumers it is a tremendously equalizing force. (19)

  2. EXPONENTIAL COMPUTATIONAL CHANGE'S BOOST TO EQUALITY

    This exponential nature of computational change is more generally a powerful force for equality. It means that innovations become more rapidly and broadly available. It took hundreds of years after the clock was invented for timekeeping pieces to trickle down to the middle class. (20) Even in the last century, only the relatively well-off had refrigerators and televisions. (21) Today, new technology circulates through the population far more quickly. (22) Five years after the introduction of multi-touch smartphones, about half of America's population had one. (23) Today it is sixty-four percent and still growing. (24) The basic reason is that new innovations make the last innovations less expensive as the value of even slightly less good intellectual property is pushed toward zero. (25) Outside the United States, smartphones have been a source of a substantial income equalization with those in developing nations using them to interconnect and make money. Similarly...

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