Amara’s Law — The principle that, “We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.” Originally coined by Roy Amara.
Artificial Scarcity — The use of law or technology to make a resource scarce that could otherwise be abundant. Common examples include intellectual property, digital rights management, public cartels, and occupational licensing.
Decline of Scarcity — The idea that over time the number of scarce, monetizable resources declines. As a result, our scarcity-based economy suffers symptoms of decreasing relevance. Whereas post scarcity describes a future when most resources are abundant, “decline of scarcity” describes the transition to that future.
Digital Abundance — In the digital domain, the standard economics of scarcity do not apply. Digital files can be copied unlimited numbers of times without diminishing in quality. As goods they are non-rivalrous, meaning consumption by one consumer does not prevent consumption by another.
Digitization — The process of taking a good and converting it into a digital format. To be digitized, a good must be able to be scanned/recorded, as well as printed/played back. Some goods that have been digitized are music, books, movies, games, phone calls, calendars, photographs, synthesizers, maps, etc. The list is long and ever growing.
Educational End Run — The use of technology to educate oneself for free and without physically attending a school or university. This is increasingly possible using websites like Khan Academy and Udacity.
General Purpose Technology — A technology with the potential to drastically alter all sectors of the economy. Examples include the steam engine, electricity, and most recently, computers and the Internet.
Superstar Effect — In many industries, a very small number of actors (and in some cases single individuals) are able to dominate a disproportionate amount of the market share. Advanced communications technologies tend to amplify this effect by dramatically extending the reach of such “superstars.” As a result, good, but not great, competitors are crowded out.
Technological Unemployment — Unemployment caused by technological advances. This includes machines and software substituting for human labor, digital abundance subverting the sale of scarce goods, advances in efficiency negating the need for intermediaries, and increased data availability undermining professions that rely on information asymmetry.