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MatthewEckmanSecondPaper 13 - 26 Jun 2009 - Main.EbenMoglen
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-- By MatthewEckman - 15 May 2009 | | | Hi Kate - I agree; however, in Matt's defense, I think he was addressing the private issue, not the government issue. Government access to this kind of information raises very legitimate concerns, but I think Matt was asking why some of us considered private access to the data problematic in itself.
-- TheodoreSmith - 31 May 2009 | |
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- Well, Matt, I think that's what it feels like to collaborate with lots of smart people. You've got a fascinating range of responses, and I think you're not done with this essay until you've taken the opportunity our colleagues offered you and given your own next turn to the conversation. I don't want to comment on the main line of the discussion until you've had your chance to speak again, but I want to answer your original question. I thought your comment in class was hard to answer without seeming disrespectful because it contained two major fallacies. I was thinking about how to discuss the first: efficient capital markets hypothesis assumes that smoothly functioning markets encode perfect information because it can be assumed that all information is available at some price, and a large enough market will contain enough transactional value that any information relevant to the market's function will be produced in return for its share of the total market revenue, through all the forms of financial engineering which efficient capital markets theorists assume work perfectly. But this assumption has never before in my experience been extended into a normative prescription that information should be compelled to participate in optimizing the functioning of commodities and product markets. "Isn't perfect information necessary?" is a question that could validly lead to the conclusion that since there isn't perfect information the market is a snare and a delusion, but it can't without much more support the conclusion that therefore perfect information should be required, or not fought against on other grounds.
- So as I was pondering how to put that delicately, you raised what is the more serious of the two fallacies, apparently—according to your account—unconsciously. You said "it's a smooth-functioning one-sided market," which I thought put the point perfectly: in the world of mass-consumer data mining, perfect information produces a smooth-functioning market in which all of the externalities are aligned for the benefit of one side.
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