class: center, middle, inverse, title-slide .title[ # A.I. and economy ] .author[ ### Thierry Warin, PhD ] --- --- ## Questions - Industrial Revolution 4.0, economics and quantitative methods? --- ## Table of contents1. 1. IR 4.0 and its impact on the global economy 2. From analog to digital economy 3. From the digital economy to the (global) platform economy 4. Why Google is going to sell pizzas --- # 1. IR 4.0 and its impact on the global economy --- # 1. IR 4.0 and its impact on the global economy ## Architecture revolution - architectural innovation for business - architectural innovation for governments (governments 4.0) --- # 1. IR 4.0 and its impact on the global economy ## The A.I. revolution for business - Thanks to A.I., **time** is of the utmost importance. In a way, time is "extended" thanks to the convergence of algorithms, computing power and data. - As a result, **information arrives closer to the point at which a decision** can be made. - **Predictive power** is gained, and uncertainty is transformed into "ambiguity". A bit like a radar able to read through thick cloud cover. - A.I. will add $13 trillion to the global economy over the next decade (Fountaine, McCarthy and Saleh 2019). --- # 2. From analog to digital economy --- ## 2. From analog to digital economy <img src="images/image1.png" width="70%" height="70%" style="display: block; margin: auto;" /> --- ## 2.From analog to digital economy <img src="images/image2.png" width="70%" height="70%" style="display: block; margin: auto;" /> --- # 3. From the digital economy to the platform economy --- ## 3. From the digital economy to the platform economy <img src="images/image3.png" width="60%" height="60%" style="display: block; margin: auto;" /> --- 3. From the digital economy to the platform economy <img src="images/image4.png" width="70%" height="70%" style="display: block; margin: auto;" /> --- ## 3. From the digital economy to the platform economy - Does the story end here? - What comes after the platform economy? --- ## 3. From the digital economy to the platform economy <img src="images/image5.png" width="70%" height="70%" style="display: block; margin: auto;" /> --- ## 3. From the digital economy to the platform economy - The notion of the Keystone Player (Iansiti and Levien, 2004) - Economies of scale + economies of scope + network effects + data network effects + ... = the new monopoly power? --- ## 3. From the digital economy to the platform economy <img src="images/image6.png" width="80%" height="80%" style="display: block; margin: auto;" /> --- ## 3. From the digital economy to the platform economy <img src="images/image7.png" width="80%" height="80%" style="display: block; margin: auto;" /> --- ## 3. From the digital economy to the platform economy ## From rupture to collision In purple: similar companies with diminishing returns to scale In gray: key players / Digital Natives with increasing returns to scale --- ## 3. From the digital economy to the platform economy <img src="images/image8.png" width="70%" height="70%" style="display: block; margin: auto;" /> --- ## 3. From the digital economy to the platform economy ## From rupture to collision - The question of digital natives: A.I. factories - The question of network and data network effects --- # 4. Why Google is going to sell pizzas --- ## 4. Why Google is going to sell pizzas > Google Express, Uber Eats, Domino Pizzas, etc. - Improving existing business models - Development of new business models --- ## Conclusion --- ## Conclusion - A.I. and data: training in new quantitative methods --- ## References - ["Government 4.0 and the pandemic"](https://cmr.berkeley.edu/2020/06/government/) (with de Marcellis-Warin, N, and Munoz, J. M.), *California Management Review Insights*, June 24, 2020 [[DOI: 10.6084/m9.figshare.12580091.v1](https://cmr.berkeley.edu/2020/06/government/)] - ["AI in Business: Seeing through the Fog of War"](https://cmr.berkeley.edu/2020/02/ai-fog-of-war/) (with de Marcellis N., and Munoz, J. M.), *California Management Review Insights*, February 19, 2020 [[DOI: 10.6084/m9.figshare.11887044.v1](https://cmr.berkeley.edu/2020/02/ai-fog-of-war/)] - ["Concurrence et innovation dans les écosystèmes numériques à l’ère de l’intelligence artificielle"](https://www.concurrences.com/en/review/issues/no-1-2020/on-topic/digital-competition-en) (with F. Marty), *Concurrences / Competition Law Review*, Vol. 1, pp. 36-41, February 2020 - ["The use of AI by online intermediation platforms. Conciliating economic efficiency and ethical issues"](https://doi.org/10.21552/delphi/2019/4/11) (with Marty, F.), *Delphi - Interdisciplinary Review of Emerging Technologies*, Vol 2, Issue 4, pp. 217 - 225, 2019 [[DOI: 10.21552/delphi/2019/4/11](https://doi.org/10.21552/delphi/2019/4/11)]