Book Reviews

Pentland, Alex, Lipton, Alexander and Hardjono, Thomas. Building the new economy: data as capital. Cambridge, MA: The MIT Press, 2021. vi, 467 p. ISBN 978-0-26254315-6. £30.00. (MIT Connection Science & Engineering)

Recently I have been reading and reviewing books on digital economics, digital life or social consequences of computerization, which all seemed very relevant to my own research and interest sphere. I have expected that this one will also be written in the same vein. This was not entirely the case as the main focus is on innovation of information systems and networks in different spheres, but mostly in finance and economics.

The chapters in the book are mainly authored by three authors named on the cover of the book, though there are other co-authors in some of the chapters. I would not dare to characterize all three as data scientists, because they seem to have equal qualifications in several other areas, such as finance, business, music, or media. Nevertheless, they have written a book which examines the ways of reorganising the existing digital economy on the principles of more equal distribution of power by providing more equal rights of participation to different groups of actors. As far as the rich content can be generalised, the way to achieve this fairer distribution of power involves engagement of the users of digital resources and services into their governance. The authors of the chapters are exploring different ways to achieve their proposed aims and establish what they call ‘a more resilient society’ (p. 3) that could be achieved by innovation within the networks, organisations and communities and distributed decision making. Legal regulation of the code and networks is one of the main aspects of the innovative digital economy that ensures the distribution of powers and the rights of all involved interested parties. Thus, law needs innovation and adaptation with regard to the resilient and fair information networks (see chapter 4).

The book is divided into three parts examining new types of engagement in data economy, increased resilience of information systems, and interoperability of these systems virtualizing majority of our present assets. The first part introduces the idea of data cooperatives that sound interesting and a refreshing alternative to private ownership of big data. Music industry serves as an example of how these cooperatives can function and what role they can play in economics. The second part is devoted mainly to financial sphere, but also health information technologies and examines tokenization processes in these two spheres where the leakage of data is the most vulnerable and security levels are high. The third part looks into the technological environment of virtual assets and the role of artificial intelligence in making them safe.

Each chapter in the book is built of two tiers: the first one introduces the idea of change and demonstrates the need for it as well as the expected benefits. The change is seen, as a rule, in several aspects: organisational, legal and technological. The second part provides concrete suggestions and models for the development of information infrastructures that will ensure and embody the suggested change. Thus, in the introduction, the authors suggest several modes of reading for each chapter depending on the interests of their readers: in addition to sequential reading of every chapter, a reader may choose to read only the later part of the chapters or only the first part. This is a reasonable suggestion, especially, for the readers less savvy in the issues of information systems or digital technologies.

The book contains interesting ideas, especially, for readers like me, who are not so well acquainted with the actual trends of the information technology development. It has definitely enriched my understanding of many processes that seemed quite opaque, though in the focus of the public attention, like cryptocurrencies, data privacy and security, participatory management of distributed data and similar processes. Thus, I would suggest that information professionals may benefit from this book, maybe reading at least the first ‘idea’ part of the chapters. On the other hand, I was somewhat disappointed by the idea of equality and fairness as it emerges from this book. With all due respect to the suggested changes and realising that some of them are introducing radical innovation, they actually involve the redistribution of power among already powerful societal actors. The ecology is related to the network environment, but not to broad natural or social conditions, in which they function. On the other hand, it was my fault to expect something that the book is not addressing at all. It achieves the aims of the authors in a very effective and professional way, so, I am sure that it will be appreciated by the readers, which it addresses.

Elena Maceviciute

University of Borås
March, 2022

How to cite this review

Information Research is published four times a year by the University of Borås, Allégatan 1, 501 90 Borås, Sweden.