Chapter 10
The Economy 4.0
A Participatory Market Society Is Born
It is human nature to exchange not only goods but also ideas,
assistance, and favors out of sympathy. It is these exchanges that
guide men to create solutions for the good of the community.
—Adam Smith
The invention of the steam engine turned the agricultural society – the „Economy 1.0“
– into an industrial society – the „Economy 2.0“. Later, the spread of education enabled the
service society – the „Economy 3.0“. Nowadays, the pervasiveness of digital technologies is
driving another technological revolution, which is creating the „Economy 4.0“, which I call
the Participatory Market Society. This society is characterized by the ubiquity of information,
bottom-up participation, „co-creation“, self-organization and collective intelligence as new
organizational principles. We will also see more personalized products and services and an
increased engagement in a serious and fair partnership with citizens, users, and customers.
Finally, the spread of „projects“, empowered by social collaboration platforms, will enable
more flexible and efficient forms of production and services.
Our economy is in the middle of a once-in-a-century transformation. Big Data,
Artificial Intelligence, and the Internet of Things will fundamentally change many
of our current procedures and transform the institutions on which our economies and
societies are based.
The invention of the steam engine was a crucial technological catalyst in the
transition from the agricultural society (“Economy 1.0”) to the industrial society
(“Economy 2.0”). This new industrial society was driven from the bottom-up by
entrepreneurs, whose self-interested “rational” mindset is often reflected by the
theoretical concept of the “homo economicus”. Consequently, very little attention
was paid to social and environmental “externalities” such as mass unemployment,
poverty, malnutrition, child labor, pollution, and the exploitation of resources.
In response, many countries established health insurances, social security systems,
and environmental laws. By increasingly complicated regulations, new jobs were
created. A new service sector (the “Economy 3.0”) was grown. Affordable mass
education played a key role in creating the societal conditions in which this shift
could take place. In service societies, administrations based on top-down planning
and optimization became the new organizational basis. Now, driven by the digital
revolution, a new kind of economy (“Economy 4.0”) is on the rise. How will it look
like?
© Springer Nature Switzerland AG 2021
D. Helbing, Next Civilization,
https://doi.org/10.1007/978-3-030-62330-2_10
197
The Economy 4.0
A Participatory Market Society Is Born
It is human nature to exchange not only goods but also ideas,
assistance, and favors out of sympathy. It is these exchanges that
guide men to create solutions for the good of the community.
—Adam Smith
The invention of the steam engine turned the agricultural society – the „Economy 1.0“
– into an industrial society – the „Economy 2.0“. Later, the spread of education enabled the
service society – the „Economy 3.0“. Nowadays, the pervasiveness of digital technologies is
driving another technological revolution, which is creating the „Economy 4.0“, which I call
the Participatory Market Society. This society is characterized by the ubiquity of information,
bottom-up participation, „co-creation“, self-organization and collective intelligence as new
organizational principles. We will also see more personalized products and services and an
increased engagement in a serious and fair partnership with citizens, users, and customers.
Finally, the spread of „projects“, empowered by social collaboration platforms, will enable
more flexible and efficient forms of production and services.
Our economy is in the middle of a once-in-a-century transformation. Big Data,
Artificial Intelligence, and the Internet of Things will fundamentally change many
of our current procedures and transform the institutions on which our economies and
societies are based.
The invention of the steam engine was a crucial technological catalyst in the
transition from the agricultural society (“Economy 1.0”) to the industrial society
(“Economy 2.0”). This new industrial society was driven from the bottom-up by
entrepreneurs, whose self-interested “rational” mindset is often reflected by the
theoretical concept of the “homo economicus”. Consequently, very little attention
was paid to social and environmental “externalities” such as mass unemployment,
poverty, malnutrition, child labor, pollution, and the exploitation of resources.
In response, many countries established health insurances, social security systems,
and environmental laws. By increasingly complicated regulations, new jobs were
created. A new service sector (the “Economy 3.0”) was grown. Affordable mass
education played a key role in creating the societal conditions in which this shift
could take place. In service societies, administrations based on top-down planning
and optimization became the new organizational basis. Now, driven by the digital
revolution, a new kind of economy (“Economy 4.0”) is on the rise. How will it look
like?
© Springer Nature Switzerland AG 2021
D. Helbing, Next Civilization,
https://doi.org/10.1007/978-3-030-62330-2_10
197