David Deming at the New York Times: “Governments and technology companies are increasingly collecting vast amounts of personal data, prompting new laws, myriad investigations and calls for stricter regulation to protect individual privacy.
Yet despite these issues, economics tells us that society needs more data sharing rather than less, because the benefits of publicly available data often outweigh the costs. Public access to sensitive health records sped up the development of lifesaving medical treatments like the messenger-RNA coronavirus vaccines produced by Moderna and Pfizer. Better economic data could vastly improve policy responses to the next crisis.
Data increasingly powers innovation, and it needs to be used for the public good, while individual privacy is protected. This is new and unfamiliar terrain for policymaking, and it requires a careful approach.
The pandemic has brought the increasing dominance of big, data-gobbling tech companies into sharp focus. From online retail to home entertainment, digitally savvy businesses are collecting data and deploying it to anticipate product demand and set prices, lowering costs and outwitting more traditional competitors.
Data provides a record of what has already happened, but its main value comes from improving predictions. Companies like Amazon choose products and prices based on what you — and others like you — bought in the past. Your data improves their decision-making, boosting corporate profits.
Private companies also depend on public data to power their businesses. Redfin and Zillow disrupted the real estate industry thanks to access to public property databases. Investment banks and consulting firms make economic forecasts and sell insights to clients using unemployment and earnings data collected by the Department of Labor. By 2013, one study estimated, public data contributed at least $3 trillion per year to seven sectors of the economy worldwide.
The buzzy refrain of the digital age is that “data is the new oil,” but this metaphor is inaccurate. Data is indeed the fuel of the information economy, but it is more like solar energy than oil — a renewable resource that can benefit everyone at once, without being diminished….(More)”.
