Interview: Alex Pentland on the benefits of data beyond economic forecasts
Alex Pentland is a professor at the Massachusetts Institute of Technology and one of the world’s leading expert on the social impact of big data and the new economy. ERR News had the opportunity to talk to him at the Estonian EU presidency’s digital single market conference.
ERR News: You have said that data is worth more when it’s shared because of the social benefits this can bring. How does this go together with demands for privacy?
Pentland: There are two stages to think about. One stage is more like census data. Every government on some level runs on data about where do the people live, how much money do they make in this neighborhood versus that neighborhood, what do houses cost here—those are things that make society work better, that knowledge. That’s shared data, all of that is shared data.
The second stage to think about is: people exchange data for value. For instance, I’ll tell my bank things about what I own and how much money I make in return for getting a loan. So that’s a data exchange that has value both to me and to the bank, but it’s a very controlled one where I get to set the rules about what I’m going to share and with whom.
You can think about data exchange as facilitating real-world exchanges. Employment, loans, ownership, and in the aggregate as facilitating government and how well government can do things. Where do they put resources, where do they build a road, where do they build a school, things like that. Those are the sorts of data sharing that are common today that are important.
The sort of things that are in the future are things like being able to share data about how different medical treatments work. People do that informally all the time, “You know I got this operated on” and everybody sort of talks about that. But they don’t do it formally enough so that it really is statistically valid, so it’s all rumor. But wouldn’t it be nice to be able to do that in a way where it was really about knowing what was better?
Today you can’t do that, there’s no framework for doing that without exposing yourself. So what we’re talking about is having a framework where you can contribute a little data, but benefit from the wisdom of the community.
We keep hearing about the economic value of the digital single market. What about other values? What about the added value in social terms?
I’m a little suspicious of any of these forecasts of value, because that’s an industry that doesn’t exist yet! How do you know how much money it’s going to be worth? I don’t know.
What I’m really interested in is the fact that communities that have very little data exchange are communities that inevitably have higher crime, higher infant mortality, earn less money, and the reason is very simple, it’s that if you have less opportunity, if you don’t know what’s going on, if you don’t know where to take your child when they’re sick, if you don’t know where to look for a job, if you don’t know what is a good deal in buying a house, you don’t do as well.
That’s a personal value. And in every society there are these ghettos that are just not connected to what’s going on, and they don’t do very well. And their children don’t do very well. And then there are people that are hyperconnected and know everything, and that seems a little unfair, right?
But they do very well. So why can’t we give that sort of access to opportunity to everybody? We could, but not the way things are structured now. So that’s a personal value again.
Another point you make is that data can be used without there necessarily being a single point of control. Could that contribute to a more democratic society?
Absolutely. The tendency is for things to move towards being more centralized, because the people in power want to have their fingers on it. Also there’s a natural human tendency towards centralized systems. If you want a really democratic participatory economy or society, you want it decentralized, you want everybody to be a stakeholder. So you’d like it to be a lot more decentralized than it is today.
Are there obvious economic benefits to that as well?
Well, access to medical things, access to jobs, so many of the things that are power today—why are bankers powerful? Because they control information that you don’t. Just go down the list, a lot of it is fundamentally controlling information. So why isn’t there this sort of open access to information for everybody?
That’s decentralizing the power, which gives opportunity to people more broadly.
The digital single market and a digital society for all of Europe—dive in, or be cautious?
I think you want to dive in, but you want to dive in at the appropriate end. The end that’s easy is the end where it’s aggregate data. Then you don’t have all those questions about personal data and stuff like that.
Think of it like that: What could we do if we had really powerful census data? Not just how many people live in this town, but what’s the average income, how much are they spending this month, how much were they spending a month ago, how many people got the flu, how many of them broke their leg. Let’s imagine you have all that data, but on that sort of neighborhood or town basis.
That would be really helpful, so dive into that. There are obvious benefits, and it doesn’t have obvious problems associated with it, and that will get people familiar with what we’re talking about, in a safe way. And then we can talk about the things that are a little more questionable, maybe a little more dangerous.
Editor: Dario Cavegn