The Robots Revolution: The Hummingbird Effect and the Fourth Industrial Revolution
This conference has four main parts. In the first part, Professor Sala-i-Martin explains the Hummingbird Effect: a phenomenon used by economists to explain how an innovation that occurs in a sector, ends up having huge effects (positive or negative) in different sectors that ...
This conference has four main parts. In the first part, Professor Sala-i-Martin explains the Hummingbird Effect: a phenomenon used by economists to explain how an innovation that occurs in a sector, ends up having huge effects (positive or negative) in different sectors that apparently have not a direct relationship. To illustrate this effect, he explains the history of glass, analyzing a whole chain of phenomena and innovations that took place since the invention of transparent glass, the discovery of the “enhancing” powers of concave lenses to the consequent improvements in water treatment, sanitation and personal hygiene.
The second part analyzes the consequences of the Fourth Industrial Revolution, the greatest industrial revolution in history, where the physical, biological, digital and mental worlds are converging. Unlike the previous revolutions that were caused by the emergence of a new technology, the current revolution combines the emergence of dozens of new technologies in the fields of robotics, AI, big data, disintermediation, nanotechnologies, 3D printing, digital medicine, the uberization of capital and the cognitive sciences, only represent a few of these innovations. The question we ask ourselves is: What will be the consequences of all these changes? Are we going to lose jobs at the hands of robots? History shows that in all previous industrial revolutions, men have ended up creating more jobs than those that were destroyed. But will it be different this time?
The answer to this question is analyzed in the third part of the conference, using the Hummingbird Effect perspective: the direct changes of the Fourth Industrial revolution are easy to analyze, and the consequences are going to be mostly positive, just like the previous revolutions. The global consequences are very difficult to measure due to the Hummingbird Effect and the extraordinary speed at which changes are happening. Here, through examples of unforeseen effects of a technology in other sectors, we analyze the emergence of Airbnb or the passenger transport market on Uber and how the financial market its been transformed with new FinTech technologies.
In the last section, Professor Sala-i-Martin addresses how governments and companies around the world should face these challenges. The Hummingbird Effect tells us that the changes that are coming are totally unpredictable. The key to survival is the capacity for adaptation: whatever changes may come, the companies and countries that will survive are those that can adapt to this new (uncertain) situation. The main challenges are analyzed in three different areas: human capital, organizations and regulation.
Specifically, regarding regulation, in a world where technologies change at the speed of light, legislators are being left behind. Yet, it is necessary and urgent to analyze the ethical implications and the challenges posed by the introduction of new technologies to define where limits should be established.
The main conclusion is that the speed of the changes we are facing, in addition to the unpredictability of the Hummingbird Effect, make the Fourth Industrial revolution “the mother of all revolutions”. And we still have not thought about how to deal with it.