Impact of Digitization and Human Capital

Part 1: Enabling the Cross-sharing of Experiences

CHUMA Hiroyuki
Faculty Fellow, RIETI

Digitization, a phenomenon that is occurring rapidly across the world, is in essence about encoding, informating, and automating everything. When the first two processes—encoding and informating—are fully automated, it will become possible to communicate and respond to information in real time, use necessary information just in time, and freely switch viewpoints by zooming in and out. Yes, things will operate just like the way Google Maps and Google Earth applications do.

A particularly big social impact will come from real-time informating, supported by a cloud computing like architecture where many people will share a database instantly. Under this architecture, individuals can see from a third party point of view how they are in harmony or at odds with a large number of people and how the relationships turn out as a mirror image reflected from the cloud as a mirror of society. Making the process and outcome of activities fully visible to an unspecified large number of people is tantamount to observing the behavior of actors on a stage including themselves. This will generate significant social benefits in the form of enabling people to make use of experiences of other people.

It is thanks to digitization, which has enabled the ultra-wide bandwidth of information transmission and the ultra-low latency thereto, that we are able to obtain a mirror image of how we complement and substitute for one another within a network. Potentially, anyone can access the mirror image from anywhere in the world. Furthermore, the use of a mirror image that has a hierarchical structure organized in an easy-to-understand way would enable the precise abstraction of information within each layer of hierarchy and the clear and prompt traceability of information across layers. This would make it possible for more people to access a bird’s eye view (metacognitive information) to see the relationship between the part (themselves) and the whole (society) just as easily and quickly as using Google Earth today. Therefore, the more democratic the society, the greater is the likelihood for the popularization of metacognitive information to occur.

The resulting feedback effects include the emergence of the cloud-based mirror of society, the popularization of metacognitive information generated therein, and growing economic benefits generated by global-scale social experiments and learning through the cross-sharing of experiences. Can a country where it is difficult to take advantage of these positive feedback effects be a match for those with such effects built into society?

>> Original text in Japanese

* Translated by RIETI.

May 17, 2017 Nihon Keizai Shimbun

February 27, 2018

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