New podcast with Glen Weyl, Microsoft’s OCTOPEST. Our conversation is available everywhere (Apple Podcasts, Spotify, YouTube, etc.). Please subscribe, follow, and review.
Glen is Microsoft’s Office of the Chief Technology Officer Political Economist and Social Technologist (OCTOPEST), where he advises Microsoft’s senior leaders on macroeconomics, geopolitics and the future of technology. He is also the author of Radical Markets, which is one of the more thought provoking economics books.
Here are some highlights from my conversation with Glen Weyl.
Traditional democratic voting systems only ask us to share our favorite option. In San Francisco, we have preferential voting, which asks us to rank the options from our favorite to least favorite. But this still misses how much we care.
Quadratic voting, however, draws out exactly how much you care. People receive a pool of credits to allocate. But it's quadratically more expensive for every additional vote. To buy one vote, it costs one credit, to buy two votes it costs four credits, to buy three votes it costs nine credits, and so on. You are incentivized to have a little bit of influence on a lot of things. But if you care a ton about certain things, then it makes sense to spend your credits for those particular types of things.
While quadratic voting is new and very different, it already has a bunch of success. In Taiwan, quadratic voting is used to rank hackathon projects. Judges use these votes to signal what is really important to them, and that's how they give out the prizes from local governments. The Colorado State Government uses quadratic voting to allocate the state budget and make a lot of executive branch decisions. Civilization VI, a popular strategy game, uses quadratic voting as its voting mechanic to determine global policy.
Today, we have little incentive to make small, individual contributions. We assume that these contributions won’t make a difference, so we’re left with a few large contributors. Kickstarter claimed to create a more democratic system, but funding still lies in the hands of few. Quadratic funding challenges this by matching every dollar that you give inversely proportional to what share of the community you are. It favors things that have many individual contributors more than the ones that have few contributors, encouraging people to make contributions, no matter how small.
Most companies have divisions that don’t cooperate with one another. But it’s in the interest of the company to encourage cooperation, especially when it comes to cross-cutting infrastructure. Quadratic funding can incentivize cross-division funding by creating a matching fund where headquarters will match contributions made by multiple teams.
We put up with really low quality data, because people aren't engaged with the process of designing and collecting it. Most people do not understand where and how their data is used. So even when they have perfect information and could make really easy fixes to their data, it just doesn’t happen. Helping people participate in data collection can massively improve data quality.
Glen shares an example of where this works. In Taiwan, a bunch of people who were worried about pollution and have IoT devices in their houses are now active participants in data creation. They invest in making sure these are working, improving the quality, and in exchange, they ask the government to place IoT devices in certain places and monitor the air pollution.
ZoomInfo is another example. They contact everyone in their B2B contact database, explain how their data is used, and provide them the ability to correct any of the information collected. In return, users know that they’re making the entire community better and more valuable.
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