Your data’s barbed wire
The first patent in the United States for barbed wire was issued in 1867 to Lucien Smith of Kent, Ohio, who is regarded as its inventor.
Barbed wire has been regarded as one of civilisation’s smartest inventions because it clearly defines one’s property. In a market-driven capitalist economy, this property becomes an asset. For example, it can be used as collateral for credit. This can help to kick-start a small business or to buy a cow.
In the future, personal data will be the new barbed wire. It will be an asset that can be shared with a bank to take out a loan. For where one piece of land surrounded by barbed wire would have exclusive value, so would your data. Whether this data is the time you wake up, what you eat, where you shop, how many steps you take, how many times your heart beats and when, what websites you browsed, what TV shows you watched … this will be a great source of information for companies with a value which could be equivalent to your home or land.
As there will be a liquid market for data, the bank would know that it can easily “mortgage” your data to another firm to recover the unpaid loan if required. Big tech companies already pay for access to this precious data. Such data can help firms in deciding when to send you an advertisement, what to offer you to buy and how much you should pay for your health insurance. It can also be used to understand what movies a company should produce (indeed, Netflix is already using our data for this purpose).
What is currently lacking is the framework, or rules, for buying and selling data and the data privacy laws which, as things stand, either lack consistency, standardisation and transparency or are not understood by technically illiterate policy-makers.
One of the major accomplishments of British rule in India was that across the sub-continent parcels of land and buildings were represented in property documents. This allowed assets to be monetised, bought and re-sold easily. Moreover, this allowed them to be used as collateral for credit.
When Hernando de Soto came across barking dogs in Indonesia demarcating a household’s property instead of a legal boundary, he wondered how much a country might grow simply by assigning clear property rights. He asked us to imagine a poor country where nobody can identify who owns what, where people cannot be made to pay their debts, where descriptions of assets are not standardised and cannot be easily compared, and where the rules which govern property vary from neighbourhood to neighbourhood or even from street to street.
When we achieve clear rules that can demarcate the extent of one’s right to one’s own data, there will be a liquid market for data to which we can go in order to sell all our life’s worth. Whether that is a worthy goal or not, we are being led towards it.
With apologies to Rabindranath Tagore:
Where the mind is hacked by Netflix;
Where knowledge is Google;
Where the world is broken up into fragments of re-Tweets;
Where words come out from WhatsApp forwards;
Where tireless striving stretches its arms towards Prime delivery;
Where the clear stream of reason has lost its way into the dreary desert sand of dead habit;
Into that heaven of data privacy, let my country awake.
Prakarsh Singh
Prakarsh Singh has a PhD, Masters and BSc from the London School of Economics. As an assistant professor of economics, he conducted six years of research trying to improve child under-nutrition in India, before moving to new pastures in 2017. He currently works as a Senior Economist at Amazon in Seattle.
