Maximizing social welfare
The word economics comes from ancient Greek and translates to the ”rules of the household”. While we can trace the origins of economics to ancient Greece, the most real emergence of economics came in the 18th century enlightenment. Many of the thinkers of the time were concerned with ethics and human welfare, and at its heart, saw economics as a way to maximize human welfare. Just as a new world was opening up then with the industrial revolution, we are at the dawn of a new age with the internet. To ensure the maximum benefit for all requires a discipline of stewarding resources. Economics gives us the tools to do this.
Evidenced-based decision making
One of the important and powerful roles of economics is to provide a framework to make decisions. Today’s internet policy debate is emotional. There is a desperate need for evidence. We use evidence in medicine and law, and we need to bring evidence to crucial questions of the internet. These question can include how to maximize the benefits for users, what are the costs and benefits of different forms of governance, what is the optimal amount of regulation, and what are the pricing regimes that can ensure fairness for stakeholders.
The internet has evolved quickly in 40 years. There are more users, applications, devices, technologies, and complex relationships than before. Like outer space, the internet is a frontier. Scientists mine the deep web as an astronaut would explore another galaxy. While we may try, there is much we can’t know. Thus we need to avoid the hubris to think that we have the single policy solution. Instead should allow a multiplicity of possibilities and then use economics to determine which maximizes the value of the internet for the maximum of users.
The foundation of all science is experimentation. The internet allows experiments on a massive scale, quickly and efficiently, usually without harming users. Experiments in internet applications, technologies, and networks can provide valuable data. Scientists, inventors, entrepreneurs and others need this feedback. We need to encourage experimentation, accident and chance, which is often the hotbed of innovation.
We live in a complex world. The internet gives us possibilities for which we only dreamed, but also new problems we never expected. There are many conflicts, often between parties which need the other. Many see the internet as a fundamental human right, as a commons, and place for free speech. But that does not diminish the reality that there are real world requirements for capital investment in equipment, a role for governance, and the need for privacy and security. Internet economics provides a rational approach to these concerns.
Free exchange of ideas
There is a lot of academic literature about the internet on the internet. Yet much of this scholarships is too dense and arcane for people outside the authors’ fields to understand. Furthermore much but not all important research is available in English. Having studied in universities outside the USA, I am accustomed to reviewing resources in other languages. Where possible, I attempt to provide my translation and interpretation of that research to a wider audience. I also wish to share my own research and engage in a constructive discussion. My hope is that my investigations of data can inform discussions in a positive way.
Key Performance Indicators (KPIs) for Search Engine Marketing. McGraw-Hill, 2009. This piece originally appeared as a chapter in Search Engine Marketing, McGraw-Hill, 2008. Read it here.
2013 TPRC | 41th Research Conference on Communication, Information and Internet Policy. September 27-29, 2013. George Mason University School of Law, Arlington, VA, USA. http://www.tprcweb.com/
Other Resources on Internet Economics and Policy
The Dynamic Internet: How Technology, Users, and Businesses are Changing the Network by Christopher S. Yoo. AEI Press, 2012. Read my review on Amazon.
The Illusion of Net Neutrality: Political Alarmism, Regulatory Creep, and the Real Threat to Internet Freedom by Bob and Eva Zelnick. Hoover Institution Press, 2012. Read my review on Amazon.
Regulation and the Performance of Communication and Information Networks. Edited by Gerald Faulhaber, Gary Madden, and Jeffrey Petchey. Edward Elgar Publishers, 2012. Read my review on Amazon.