Originally Published @NWI Sunday Personal data: Our greatest economic issue
Personal data is far from a privacy issue alone. It is a human rights issue, and it is an economic rights issue. The data that people contribute intrinsically is at the core of all input to the economic productivity of the creations we produce together. Starting Sept. 25 a global coalition of organizations will raise awareness about how data’s personhood has a very real economic value that ripples through the interconnected ecosystem of finance, insurance, health, location and social technology firms. The question for economists will be, how do we invest in propping up the infrastructure that we build with our natural resource.
Personal data dwarfs the concept of any other commodity, including oil. It’s being mined, refined and distributed to produce or compel all other forms of other goods (products and services). At this point in highbrow circles, the aforementioned is pretty standard talk. The 21st century conundrum is how we choose to identify the data patrimony. A royalty of sorts for contributing our most natural of resources, evidence of our existence, is the paradigm shift that the world has been waiting for and still, the world of economics is unprepared for.
I’m regularly in audience with economists at international organizations like the OECD, UN, World Bank, Work Economic Forum and others talking about data and the trouble of unequal distribution. Economists who are thinking on the topic exhaust themselves when using linear thinking about the difference between what we call rival and non-rival goods. A rival good is a good that can only be occupied by a single user at a time; whereas, a non-rival good is a good that can be occupied by many users at once. I like to think of it as the difference between CD’s and the data that a CD holds. Economists actually look at the difference between how rival and non-rival goods can be consumed, but I prefer the term occupied, because all data is not contributed for consumption.
When we mention personal data post 2018’s enforcement of the GDPR (general data protection regulation), we are not simply meaning to enforce protections on the PII (personally identifiable information) that privacy experts are hawkish about. We are meaning that any data that disseminated from an individual and any data that is derived about an individual has a new set of agency allocated to the individual. Conceptually, it is thoughtful to assume that all types of data are buy-products of personal data, as all things are either compelled to exist or produced by individual(s); even the machines that create data are products of our desire.
Analogous to buy-products and crude material, personal data has spawned micro industries across every business sector. They mimic the nucleus of financial market’s use of brokerages. During this decade many people have become aware of the efforts of juggernaut middle market firms that coin their business as programmatic advertising, but they’re only brokering one type of personal data. In healthcare there are the PBMs (Pharma Benefit Managers), which are structured as what we’d call knowledge management to broker information between pharmaceutical health and insurance firms. Telecommunications firms are serving as digital OOH (out of home) placement agencies to get content in front of users who warrant a geographical demand. Automotive firms are leveraging the natural resource of data to build actual infrastructure to automate the highway with information. The difference between our new infrastructure and the highways we used fossil fuels to construct are that multiple types of drivers can occupy the bits of the information on our new highways at once. We need to be quantifying that dynamic distribution.