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do you want to
it's a little early but
guys well I found someone
to give a talk that
if you ever
out
what does my economy
asking some
well you came to the right place
part of her PhD thesis work
tony is going to answer
give a warm round of applause
some part of my thesis today
now this is ongoing work so
grateful for any kind of feedback that
you guys would have
presenting this as kind of a first try
because when i looked at the topic of
mean for an economy
anything academic and
surprised
question to me because
mostly at
read a lot of newspaper articles and
difficult and
holding itself back by having this big
what but no one really looked into how
it is holding itself back or if it is
even holding itself back
really
don't even have an agreement among
economists or business studies people
about what impact the
the economy
what does internet censorship due to an
economy
ask what does the
economy and we don't even know that
was quite surprising to me and
a little bit later on but
was thinking
question to ask
internet censorship
welfare
so some of you might think of welfare
state gives to its
as the consumer and producer surplus
basically the difference between what
something costs and what you can sell it
for
difference between what you would be
willing to pay and what you're actually
paying is your consumer surplus
let's assume
I have a laptop and
would have been willing to pay
think it's a very good product
actually got it for like 800 or 900
consumer surplus is something like
600-700 euros and if we add up
everyone's individual consumer surplus
first
does the
and
good agreement on that
measure that
the
wasn't very clear in the research that
retail and possibly some other
possibly but not necessarily
advertisement revenue is reflected in
this
big consulting agency that basically
very diligent about their methods
basically
that the UK has a pretty big part of
probably mostly because of online retail
which is bigger in the UK
that there is a small difference between
developed and developing market averages
but this seems like a very
all I don't know the
really say whether this is actually good
measure
because a lot of the stuff that the
at all
one example is free online courses
of
the web
them are not add enabled
them don't really have advertisements
the general sense so classical economics
basically says well they don't
create
taken one of these online courses and
maybe you've been lucky and took a good
some of the courses I took
some value for me
so one of the ways to look at this is
actually to think about time as
something that has
so if
online course
example earning money
spending it doing something literally
that is fun for me and these guys
how to pronounce it exactly
he sounds Swedish possibly and
they tried to get an idea of how much
consumer surplus these online courses
actually create
reflected in the
some models
if we take
model which is 4.1 a billion dollars on
average for the
of economic welfare that somehow being
created that is not reflected in
actually pay money for another example
that we might think of
wikipedia has a certain
operating obviously the servers and
stuff but because most people
contributing to
volunteers
not really reflect the true value
you don't want to say
don't agree that money had
opportunity
what about the money that you don't
spend on enpsychopedia 'he's
you guys have
how many of you guys have recent
that's a little less
more
my family also we also have an
or something
an encyclopedia
and buy a new encyclopedia
knowledge changed obviously
since probably
bother
like a physical book might cost a
hundred euros
have had an encyclopedia at one point
at this point
encyclopedia every year
buy it every
so in order to simplify this we can say
every year
times
million euros of economic welfare of
something that people were willing to
spend money for that they're not
spending money for
naturally useful for us anymore because
the knowledge that we have the knowledge
that they would have would be outdated
very very soon and
more
business side
there's a lot of research on whether the
internet actually increases productivity
for businesses or not
well I don't really want to go into that
debate because
on
did this wrong and
your argument makes sense so it's very
you
really like
one
a lot of businesses to rely on the
now we can see on this graph
about
the email to communicate now
obviously only works if you have
internet
access to internet in order for their
current business model to work
was just some short ideas on sort of
what can
economy and now
about it and
in what kind of effect this has
sort of the obvious people don't have
access to
the controller suppression of what can
be accessed published
internet and acted by regulators or on
their own initiative
conceptualize
personally
important one is how
internet censorship
could in theory basically have internet
censorship
have censorship that isn't targeted at
all
close the internet down basically for a
day
obviously the other one thing to look at
is how widespread is it
business or if
probable is it that you would
something
that you would try to access something
that sensor
even
censorship and the way
conceptualize it is to be kind of on a
continuum
well either
their censorship or there isn't
censorship
censorship cat has a big spectrum of
things that can
happen
sort of implications
I don't want to go through them in
detail
really interesting talks on
censorship already
interesting or important for the model
that I'm trying to build but before
trying to build my model first some more
motivation
look at
it would have an economic impact and
there actually is a study that's
conducted by a sort of lobbying
organization so obviously should be
of salt
it shows that there seems to be a
correlation between freedom and how good
the economic economic impact of
is this is just a simple correlation you
can see that
going through it
controlling for
development level but it still seems
quite rudimentary to be honest
that they use is quite bad because it is
very very
enough
someone says someone
you think the economic
country
they use to some degree
very
final answer
own model and in my model
government that chooses the type of
censorship
censorship that
very expensive
calculate our actual manpower and
this point there
is there are firms and
but instead is a number that can
fluctuate depending on the kind of
country
industries that
by their information intensity or what i
like to call information intensity
commodity and what
or what
kinds of industry is how important is
information as a commodity as opposed to
other kinds of commodities that are in
that are important for this industry
let's
equals
information is a commodity really isn't
important especially
information transmitted information we
can think of traditional agriculture
technology involved
very traditional agriculture that we
still might see happening in some parts
of
little information transmission involved
that is involved is actually mostly
through
case of
close to zero and then if we look at
information intensity of one
information is the most important
commodity
would
sorry
like let's look at
kinds of businesses like this
between we have sort of industrial
companies in the modern world
closer to the
might be
traditional garment factories
have information needs they get
or from my email
weeks or months
information requirement on the other
side closer
and being able to transmit this
information is very important
between we might look at traditional
industrial companies like automobile
manufacturing that might be somewhere in
between
randomly distributed the information
intensity of industries is also kind of
randomly distributed
random fashion
the
economies
most of them the information intensity
of one industry is kind of correlated
with information intensities of other
industries in this country like in
certain type of
quite a lot of which is manufacturing
have more industries in this area but we
have less traditional agriculture for
example
distribution wouldn't work
the service level and the
level are randomly distributed as kind
of external variables
obviously this is a simplification
because
beginning like
start
I don't know
order to get a better idea of what
happens with different types of
economies
this game
and having these random parameters
average there should be
is actually missing is the consumer as a
in here
that reflected
interesting aspect of my
presenting this
look at what this would mean for firms
in my model what kind of things would I
expect
which is always the first step when
trying to model something
first of all
intensity of something greater than
but smaller than
information intensity being close to one
is kind of a special case
censorship increases the
uncertainty of information and of course
that is more important
the more important information is for
for a traditional garment factory
important than for a
semiconductor
receive new
every month or something that's the
second thing is the more globalized the
economy as a whole is the more costly
firms is
the higher the cost
now this assumes that the censorship or
the goal of censorship usually isn't
firms don't succeed
very focused
less which makes their
associated
now of course
circumvent censorship and they can do
that for sure
that
expensive
make sure that the VPN works expensive
change it because the
decides
shouldn't work anymore so it's
intensity
increases the
censorship for
that happening
more recently
be some firms that have a relative
advantage especially domestic firms
often have a relative advantage due to
the censorship because
with it
circumvent actually
need to circumvent
because they speak the language
on
as well for the government
I've talked I've said that censorship is
costly
manpower and
actually is
night and all it all in a research paper
they calculated through different types
of censorship and how expensive it would
be to scale them up so that is actually
really interesting finding because
of
costly
censorship
affecting in a negative way
result that we would really want because
the incentives don't line up in that way
and
incentives obviously
through the internet the benefits that
businesses often
still benefit from
to do it and
most cases but developing countries that
start out at low service and
impact less of a negative impact and
censorship can actually act as
protectionism
industries
of censorship to push domestic
industries and enable catch-up growth
needs to be large enough so that these
the domestic market as well
other way would be if you decided on a
domestic internet and basically
which is kind of difficult
they still be positive for the
very in a very sort of something that
should be taken with a grain of salt
really interested in China and this is
kind of where
and i'm really trying to find a
framework where china isn't the
exception but instead
into the model
Chinese government has outsourced much
of
companies
baidu
would not exist by now actually
censorship didn't exist
actually see now is that we
example is going global
it has more functionality than whatsapp
and they're trying to get out but
censorship is starting to be a problem
for these companies that used to benefit
how the character of
what about the future
difficult to innovate with this kind of
censorship and this kind of
education that we see also makes
innovation
difficult in
especially
second we see more global
internet censorship
of a disadvantage
the supply chains actually become
information becomes the most important
commodity all
of course also makes
more costly for the economy
what about
could work in the
pretty attractive to most people most
people don't try to go outside
they don't even know that they can't
they just don't want to do it
second the
machines communicate with each other
of the censorship that we see happening
affect
and that wouldn't be a problem for what
sort of
and
economy more focused on domestic
consumption
then censorship might actually be good
for that now for me
aren't suited for this kind of question
because they tend to use
told
measure for that second
step
agent-based modeling
like to feed my
reliable data and
any of that
back a couple of years
that
types of censorship which would be
really important for my kind for the
kind of research that I really want to
carry out in the future
if you have questions you can ask now or
you can come to me later you can of
course also sent me an
happy
have
so if you have questions we have
the microphones we have
number
one thing
question
think this would increase
productivity
and
haven't seen
about what
such means for productivity and that's
kind of both ways
now one of the things to look at
just because you
doesn't mean you shut down any sort of
social network
you
aren't able to use it anymore
probably spend
find new ways to access
would probably
improve their productivity
question from microphone number
where firms use information as an input
to
that information as a commodity is very
difficult to be used in this new
classical way because
that everything is
because you
basically
and without any sort of censorship
can talk about this a little bit later
maybe you have some ideas that
interesting and
well from microphone number 2 i'm so
going the same direction for
rather defined what is the optimization
problem for the government for your
further approaches what would be the
optimization that
the world but what is the government
economic welfare as defined as producer
and consumer surplus and
the government's goal is to optimize
economic welfare for both producers
consumers and also for itself as a
producer and as a consumer
have a good proxy
welfare
time
please give a warm round of applause to
[Applause]
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