Needed: Social Innovation Adaptation

This is the point during the electoral cycle when people are most willing to consider changing political systems. The nearly half of voters whose candidates just lost are now most open to changes that might have let their side win. But even in an election this acrimonious, that interest is paper thin, and blows away in the slightest breeze. Because politics isn’t about policy – what we really want is to feel part of a political tribe via talking with them about the same things. So if the rest of your tribe isn’t talking about system change, you don’t want to talk about that either.

So I want to tell or remind everyone that if you actually did care about outcomes instead of feeling part of a big tribe, large social gains wait untapped in better social institutions. In particular, very large gains await detailed field trials of institutional innovations. Let me explain.

Long ago when I was a physicist turned computer researcher who started to study economics, I noticed that it seemed far easier to design new better social institutions than to design new better computer algorithms or physical devices. This helped inspire me to switch to economics.

Once I was in graduate program with a thesis advisor who specialized in institution/mechanism design, I seemed to see a well established path for social innovations, from vague intuitions to theoretical analysis to lab experiments to simplified field experiments to complex practice. Of course as with most innovation paths, as costs rose along the path most candidates fell by the wayside. And yes, designing social institutions was harder that it looked at first, though it still seems easier than for computers and physical devices.

But it took me a long time to learn that this path is seriously broken near the end. Organizations with real problems do in fact sometimes allow simplified field trials of institutional alternatives that social scientists have proposed, but only in a very limited range of areas. And usually they mainly just do this to affiliate with prestigious academics; most aren’t actually much interested in adopting better institutions. (Firms mostly outsource social innovation to management consultants, who don’t actually endorse much. Yes startups explore some innovations, but relatively few.)

So by now academics have accumulated a large pile of promising institution ideas, many of which have supporting theory, lab experiments, and even simplified field trials. In addition, academics have even larger literatures that measure and theorize about existing social institutions. But even after promising results from simplified field experiments, much work usually remains to adapt such new proposals to the many complex details of existing social worlds. Complex worlds can’t usefully digest abstract academic ideas without such adaptation.

And the bottom line is that we very much lack organizations willing to do that work for social innovations. Organizations do this work more often for computer or device innovations, and sometimes social innovations get smuggled in via that route. A few organizations sometimes work on social innovations directly, but mostly to affiliate with prestigious academics, so if you aren’t such an academic you mostly can’t participate.

This is the point where I’ve found myself stuck with prediction & decision markets. There has been prestige and funding to prove theorems, do lab experiments, analyze field datasets, and even do limited simplified field trials. But there is little prestige or funding for that last key step of adapting academic ideas to complex social worlds. Its hard to apply rigorous general methods in such efforts, and so hard to publish on that academically. (Even blockchain folks interested have mainly been writing general code, not working with messy organizations.)

So if you want to make clubs, firms, cities, nations, and the world more effective and efficient, a highly effective strategy is to invest in widening the neglected bottleneck of the social innovation pathway. Get your organization to work on some ideas, or pay other organizations to work on them. Yes some ideas can only be tried out at large scales, but for most there are smaller scale analogues that it makes sense to work on first. I stand ready to help organizations do this for prediction & decision markets. But alas to most organizations I lack sufficient prestige for such associations.

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