Yeah. So, like, I'm a I'm an academic economist. I work in a university. The thing I do and have been doing for twenty years or even more is I study the nature and causes of long run economic growth. You know, touching on political economy, a lot of work on innovation and, entrepreneurial dynamics and institutional economics, one of the editors of the Journal of Institutional Economics. So the sort of the topic that Balaji was has been talking about is very much in my wheelhouse from a number of of of, you know, of of directions in terms of theory. But I've also you know, I've been following Balaji for a long time. He's an interesting thinker. You know, like him or hate him, he's he's he's he's not boring. He has interesting ideas. And I, you know, I've, so I was I was sort of very keen to, you know, when the network state came out, you know, looking forward to reading this book. It was good for a few pages and then I sort of I think I I wish he'd I wish he'd stopped after chapter one, but, he didn't. But the the the real thing I I think he gets right is, with him, I share this vision of I like private order ordering systems. I like the idea that a group of people can come together and make their own rules and govern themselves by their own rules and enforce those rules and do that in a free and open way. Like, that that kind of you know, there's a, you know, there's a hardcore libertarian version of that statement, but it's also the the dream of the communitarian, same, you know, worldview as well. Like, there's a there's a a broad political spectrum of people that fundamentally share that vision. Wouldn't it be great if we could all come together, make our own rules? We can forces of power that that sit above us and and and self govern to to, you know, to the various utopias we might imagine. Right? So it's a it's a universal dream that many, many people share. Balaji's Silicon Valley startup guy, like, that's that's where he's coming from. I think the the core floor in the book is, you know, but also its power. It comes from just asking that what would a startup guy do with this problem of of how do we fit nation states? And he says, hey, startup states. Let's do that. Right? Let's let's let's let's bring a valley into this and and then do that. And right?

Got a hammer? You know, you use it. So, you know, he goes down that path and he he he, you know, true to form, he he goes, alright, entrepreneurship. What's that? So moral entrepreneurship and and alright. Finance. What does that look like? And and, you know, basically runs through the, startup dude playbook. But instead of doing this for a product, he does it for a moral idea, which is a group of people come together around a shared moral vision of a society. And, you know, so far so good. Right? We're this is this is not this is not crazy, to have that to have that thought. Many many people before him have have have have gone down that. And he's also right with the fundamental critique is that, you know, we why are nations so hard to start or, you know, or why the ones why the sort of when people do decide to try to do that, it comes off as as, you know, these weird sort of seasteading things or, or this sort of, you know, lappy micronation y type things. Like, it's it's he's right with the critique that there's a there's a drive to do it and so on. Where I think he goes off the rails, and again, this is, you know, it's not a I'm not blaming him for this for not thinking it through. It's this is a hard problem. But I see this as a a challenge of how do you design economies. And again, you know, I've got a hammer and everything to me looks like an economy, so I'm gonna come at it from that perspective. But there's this notion of what he's describing is, you know, how do you fix nation states. I would I actually I think I think the the fundamental diagnosis isn't quite right. I think, what we need what we've got is this amazing new tech stack that's, you know, crypto and web three and we can augment this with IoT and, you know, AI and all of the sort of digital technology tech stack that skews heavily in one direction that it's all pushes toward decentralization. And it makes on on a great many margins, it makes decentralization, you know, better, faster, cheaper in the in the classics of Silicon Valley playbook of, you know, what do what, you know, what should we try to do? So the technological capability to build economies that have digital money, crypto, digital rules, smart contracts, digital organizations, DAOs, digital assets, NFTs, digital agency, wallets, digital agency with with smart capabilities, wallets plus AI, digital a digital agents with tape smart capabilities and geographic, you know, recognition, that's IoT plus satellite. You know, we can there's a full stack of, you know, incredibly amazing, well, I won't say state building, but institution building capabilities that, you know, not that long ago I mean, maybe ten years, definitely thirty years, but within living definitely within living memory where the exclusive preserve of not just the nation state, but highly capable nation states working with large corporations in this sort of military industrial complexy mid twentieth century, you know, heyday of the of of the nation state since. And, you know, the fundamental thing that has shifted and, you know, credibility to Balaji for recognizing it and going there's an opportunity, is that that tech stack is now in the open. Much of it is open source, not all of it, but a lot of it. Most of it, you can put on personal devices that you walk around with. Most of those personal devices that you're walking around with, I can't control. They're they're, they're distributed. They're they're they're peer to peer capabilities. You can shield them. You know, you prop you know, and as open hardware keeps developing, eventually, you'd be able to build them yourselves. Like, we're not that far away from the full hardware and software tech stack to build your own economies. And now now Balaji went slightly sideways with that and said build your own nation states and then gave it a name, network states. I think that was the mistake. That what what he's actually describing could be perfectly well that entire logic makes sense as well if you describe that as, a group of people come together, a a club, a a a, around a shared interest. They pool their resources, but it's not the pooling of resources in this sort of socialist sense of how do we govern and how do we create an economy of resources. It's it's it's how do we create an economy of resources and the govern institutional governance of those resources. And that's the bit that is a wide open parameter space. There's different parameters I can set on that institutional governance to turn it into a hierarchy, a different set of parameters will turn it into a a market system if it's, you know, and a different set will turn it into a commons. And to my mind, that's the interesting thing we have in front of us now is that we actually have, for the first time in human history, a sort of almost programmable dashboard of different settings that we can flick on the institutions that we're choosing to. These are we can choose to adopt these institutions. Then most of them are sort of, you know, most of them we can interact with digitally. This doesn't need to be a physical we don't have to all be in the same place for this to make sense. And what that opens up then is we've got this sort of design space of economies that we've never had before in human history. We've we've we've we've always had binaries. We've had, you know, the market or hierarchy, you know, or, you know, you've got, you know, capitalism, socialism, or, you know, but, we've got corporatism and, you know, whatever else. But it was always it was very difficult to sort of to to have this full sort of menu of options. Now we've got that, and we've got that in a relatively, distributed sense. It's, you know, it's not it's we're we're far from everyone on earth having these capabilities, but it's it's it's within reason that that could happen, again within our lifetimes or or or or sooner. And that feels like the sort of the new economic problem that we have now is is not just a sort of how do we allocate resources, scarce resource and how do we allocate scarce resources from a justice perspective to ensure that, you know, by whatever our standards of justice are. But the economic problem itself has changed. It's not an allocation problem anymore. It's a coordination problem of how do we choose institutional governance in such a way that, you know, in a, you know, behind the veil of ignorance type sense that that that that those institutions provide, you know, all of the features we all all of the things we want around, ethics, justice, distribution, safety, you know, every every sort of value that you can sort of compose in a list. And where we're stuck on is just how do we do that? Like, I mean, do we do we do we do it through the nation state? Do we do it democratically? Do we do it as civil society? You know? And that's those are social, political, cultural questions, but I've it feels like that's where we are. So just to sort of conclude my my summary there, the the the thing where I think Baji went wildly off track was he framed that as a political problem, that this is a Us versus them or a, you know, Bitcoin Maxis versus the state versus the whatever. And I don't I mean, this is where I don't see I don't see how we can get, political solutions to these types of problems. You know, we're really from from any from any direction here. But, yeah, that's that's sort of my high level high level overview.

Yeah. Yeah. I'd agree with that. So, let me let me try and sort of sharpen up my argument a bit in that direction. So, economists tend to do what economists do, which is that they see the world through the lens of efficiency, not justice or power or other sorts of other values. And this is also true for the study of institutions. So they one of the sort of basic foundational ideas in institutional economics is the idea that there is no such thing as a perfect so an institution is just a set of rules for coordinating people to to to to achieve, you know, common ends or or coordinated ends. So the rules of the game is an institution. But I was saying before, when I was talking about this the design space being widely open, what I mean there is that, different institutions have different social costs. And we evaluate an institution not by how it achieves its end, but by the cost of it doing so. So there's no such thing as a as a costless institution. All institutions impose some costs. Those costs can be transactions, costs, coordination costs, governance costs, monitoring costs, just, you know and and these costs are measured in just, you know, someone has to do the thing. Right? Or there's time spent doing a thing where it's someone's job to do something. And different institutions impose different, coordination costs, social costs, transactions costs on on things. And what we mean by an efficient institution is one that just minimizes those costs. So through the economic lens, what we want to do is we want to choose institutions from the design space of all possible institutions that are the most efficient. Most efficient in the sense means they minimize the total social cost of of of doing that. Now, these costs can be in many dimensions. So the the classic way of the classic sort of way of describing this in economics is there's disorder costs or costs of chaos and markets, for instance, have high disorder costs. Right? They're they're chaotic mechanisms. You you you you're willing to to, you know but they're very, very good on dictator costs. So markets minimize dictator costs and maximize disorder costs, and that's a point on the curve. A government or a hierarchy has the has it the other way around. A hierarchy is very good at top down control, which means that it, it minimizes disorder costs or or or costs, but it it imposes dictator costs or costs of, sometimes these are called agency costs. But what the point is is that there's no such thing as a perfect institution. All institutions trade off on some margins. Commons is a commons, for instance, is is usually pretty good on disorder costs. It's usually quite high on transactions cost because they don't scale over they they usually don't scale very well. I think there's a, we wanna say later on is that I think in a digital economy, they do scale very well, which is which is why they're often highly efficient institutions. So the the basic premise of industrial capitalism is that markets are very efficient institutions in most situations because they minimize a bunch of costs except when they don't, and that's when we use governments to provide public goods or other sorts of things. And the the broad sort of institutional economic argument about why economies and societies look the way they do is that they've evolved under cost selection pressure to minimum to to to a set of institutions that minimize social costs in economic production. And that's the sort of mix of some parts markets, some parts firms, some parts government. Interestingly, no parts common. And it was Eleanor Ostrom who sort of first pointed out and studied in, you know, enormous detail saying that the economists were wrong about this, that if a commons is actually highly efficient institutions in a range of specific circumstances, and she showed when they were. And her argument was not that they're not that they're good institutions, they're morally good or, you know, they're nice to have, but they are efficient, that they were superior to market government outcomes on an efficiency criteria. And that was an incredibly powerful argument to make because she basically took it to the economists on their own terms and said, this set of institutions is actually, you know, the most efficient institution for organizing a bunch of types of resources. And, you know, she was dealing with forests and fisheries and physical natural resources. But what's interesting I mean, the I think the my sort of central point at the moment is that, in a digital economy when we're dealing with knowledge resources or data resources or code resources or resources that have digital existence, which is, you know, all of web three, they are incredibly efficient when organized as a commons. And if that's the case, then that implies that the economic structure or an economy that's built digitally should have commonses at the center of its institutional organization, not markets, not hierarchies such as firms or governments. It'll be a place for all of those, but, that's the fundamental way that a digital economy is different from an industrial market capitalist economy is that is in its mix of institutions?

Yeah. That that's interesting. I I think I mean, you're absolutely right. Just to take the first point, you're absolutely right about the role of of, competition. Right? So, where where markets often regularly fail in terms of creating effective dictators in them. I mean, we we we just call that monopoly. Right? So monopoly is the scourge of markets because it creates power in that. Yeah. And and some, you know and this is in in many ways, this is the role of regular regulation, effective regulation to try and control that, to create competition in those in those spaces. That's a perpetual battle. So and and I think, you know, when what what's interesting over the past few weeks, is just sort of seeing how poorly that has been done in in banking, for instance. I mean, global banking is basically a series of very, very large quasi monopolies, that are that have, you know, there's another market society at all. So yeah. So I think, you know, the the this is this is this is an argument for why we need why disruption is valuable and useful here. This is that you can control market societies And in a in market capitalism, the only way to control market power and and and and and dictatorship coming up is through equal power from the states to regulate and control that. And, you know, what's interesting about this sort of Balaji model is that he he does throw up a third a third variation, which is just exit. We just start again. We just throw it all burn it to the ground and start again. And, again, I I'm I'm a little bit drawn to that. The physical side, I mean, that's the hard that's the hard challenge here. And and, you know, we we have to live somewhere. We we have you know, we have to have jurisdiction under law somewhere, which means that we have to be, you know, either, by definition, we're gonna be in a nation state, unless we can sort of exit from that or have some sort of you know, complex treaty arrangement, to overcome that. So the the physical the physical side of governance, legal governance over person, and and and the assets and and other sort of property that exist in that space is always gonna be challenging. But the the question is I think the interesting thing is the margins of that. Like, does that is is this really about free movement between? And are we fundamentally talking about migration and passports and the ability of me to travel and live wherever I want, around the world? And that's with nation states gating that. Is it about free movement of capital? Can I move assets around? Financial Yes. Or or increasingly data. Right? Data is increasingly the most valuable asset in the world now. Can that move freely around or or not? And, you know, we've got this interesting you know, the the twentieth century was interesting from a, you know, from a globalization market economy perspective because you had incredibly free movement of one factor of production capital, almost no movement of the other factor of production labor. And that's, you know, we could have had a world where it was the other way around, or neither or both. Right? And and it's it's not all you know, but that was what we got. And I think, you know, again, what I like about the just the disruptive energy of Balaji there is just, alright, burn it to the ground, start again. What would it be to create an a a new world order where we had that kind of mobility, you know, that that where where people had the same rights as capital, in in in that sense of mobility. So but I I don't know what the solutions are to this. It's whether this is sort of one of these things that this is the 20 century is we're gonna spend this time just chipping away at this fight to try and recreate that kind of global openness of physical movement, or whether we completely give up and just go, alright. That's what the metaverse is for or that's what that's what we we we we travel free you know, we we live in little cages in the ground and and move freely through cyberspace. So, like, I I I don't know.

so there's there's there's a bunch of sort of regulatory barriers that just a lot of the the way that economic institutions, regulation, legislation are designed for a type of economy that kind of no longer exists. Right? It was it was one where, you know, all cap all productive resources were capital, and capital was physical and stayed in one place and was relatively uniform. So there's just the the the enormous rise of production at the edges or or this ability of of of of, you to do I mean, this is a an an interesting trajectory that's often not not appreciated, with, you know, over over the past hundred years of market capitalism is that market capitalism started with a lot of commodity production in factories that, you know, we all more or less got the same things. And that sort of became a bit of a and as, you know, as as market economies have grown and evolved, we've seen this massive rise in scale of production. Chemical industry, and so on. But in the in many other industries and sectors, what happened was that productive capabilities got pushed out to the edges, into offices, onto your phones, onto your laptops. And, you know, we see this in educate we see this just the service sector broadly is is is increasingly like that. And that that sort of those parts, you know, in in one sense, they've these are the parts that have, struggled with, you know, innovation capabilities in many in many times. They're they're the parts that we see the the most diverse distribution of globalization or some some you know, in some countries, enormous productive capabilities and wealth and power in those sectors, in other countries, nothing at all. And we don't see sort of globalization having really played out in that. So you've got this divergence in, in economic growth dynamics that really that, you can see sort of starting to come apart in a digital economy, where digital economies are really starting to to to, to gather that back together again. And this is not just in a crypto with, you know, with money and banking, for instance, suddenly taking the power back from, you know, taking taking payments and money and banking and savings technology and, that ability back to the to the edges where people are able to do that for themselves now rather than lying on on some you know, that's the that's the fundamental crypto thesis. Right? But we're we're starting to you know, we saw it with desktop publishing and media and music and so on and and a lot of other things where this shift went back towards the user or the it's not quite right to say the consumer because this is a consumer producer at the same time. And it's mostly because they've just got more tools. Many of those tools are digitally native. And those tools are widely distributed. And that sort of user innovation or user capabilities, like, that's the big story of of how market economies have evolved in the last twenty, thirty years compared to the the twentieth century. Is it it really is shifting away from the sort of factory industrial production capitalism that, you know, that is, you know, the car industry, the transport industry. Now there's a bunch of industries that are definitely like that and will continue to be. But even ones like energy production are starting to shift now. That energy production used to be a small number of mega production plants on rivers or near the coast that ate coal or whatever, absolute industrial monoliths. It's entirely possible that we're we're actually through that transition where, you know, we're we're we're not through it yet by any means, but it's where there's a tipping point that's gonna happen at some point where the energy distribution grid or the energy production system actually becomes mostly decentralized, entirely because of, you know, new technologies. Right? And so what is happening so the the the story I'm telling here is that I think market economies themselves are evolving towards decentralization. Digital is accelerating that that path toward decentralization. The end state here, the end state, if you look at, you know, where is this all going, is massively more complex economies that have enormous amounts of productive cap capabilities in households, on phones, on laptops, stuff that is protected by encryption and and other sort of other sort of ways of, you know, limiting surveillance and so on. Much more peer to peer. No. No. In in that respect, you know, that is the that is the that's not just Balaji that spotted that as well. That's that that's also, you know, that's that's I think the the most significant way to describe, you know, the last twenty years of superclusters of digital technologies is they all point in one direction. There's one exception to that which was AI in this sort of, you know, surveillance capital in this surveillance sort of big data model. But, I mean, what we've and, what we've sort of learned in the past six months is that, even that might be end up as a series of, you know, jailbroken language LLMs on everyone's phones. But so the so so so this is my this is why I'm sort of optimistic about where I think how economies are evolving. They're evolving past market capitalism, but it's not post industrial. Where they go next is they become extremely distributed at the edges, not just in terms of production, but crucially, fundamentally, in terms of innovation. And this is the new thing that that we've never had the history of, you know, we we haven't had for hundreds of years, is the idea that, and this is what I call the innovation commons. But this idea that we've now got these capabilities, to use social media tools, to use digital commons, to use platforms and toolkits, to pool resources for the use and discovery of, you know, technologies, broadly useful technologies. And this is all sorts of things. This is DIY stuff around the house, recipes, you know, just sort of low end thing. But also things like, you know, just, you know, often to the health care space into sort of, you know, experimental design of your own sort of treatments and so on of things. If we combine a lot of frontier AI technology, you know, chat GPT type, you know, help me understand how to do this. We've got this enormous shift in where production and innovation is occurring in economies, and that is entirely fundamentally due to the digital economy. And I think we're still just at the start of this. And so what so what we're still starting to see is, you know, what crypto smart contracts, blockchains, decentralized identity, the sort of full tech stack around building institutions around that enables groups of people to come together and collectively create resources, govern resources, share resources, innovate in that space, I e build economies. Now at no point that I need to say the word nation or state, in in in that in that context because what that capability is is, you know, I think these are these are economic systems that are being built. But for the first time, they're cheap. We can we can spin up purpose built economic systems that are we just need them to last for the weekend, or we just need it to last for this group of things or whatever. They're they're cheap to make. They've never ever in the history of humanity been cheap to make it before.

Yeah. That's that's really interesting point. I think so how I would frame this this this this topic is, we're in a period now of massive institutional creative destruction or institutional innovation. Like, I think we're gonna see more new institutions born and old institutions killed off or extinct or or whatever, than than we have for a while. But that's that's also that's kind of normal. Right? But it's like institutional evolution is not something that just goes smoothly on the background. We get these huge sort of punctuated equilibrium periods where, you know, back into the early nineteenth century, a huge number of institutions sort of emerged at the end of feudalism and and so on at the beginning of that. And then they stabilized over a few 100 years. And I think we're in this period now where where, you know, as I'm saying, this this is an incredible period because we can we've got the design space of institutions is so wide open. The opportunities for institutional innovation are so, just rich and deep and global. You know, we're we're we're playing with this at a at a global level. And I've always been a bit of a fan. I mean, my my central principle here is is of subsidiarity, and I think you want institutions designed at the lowest possible level. And what that means what that has traditionally meant, for the topic that we're talking about here was, industry self governance. But industry self governance has a very bad record, and you know, and mostly was just a source of corruption and and insider dealing, which is why, you know, the the counterpart wasn't industries industries self governing and, you know, group of people come together and make their own rules and enforce them. It was like, no. We're gonna regulate and use this power of the state to to enforce those rules. And and, you know, that was that was necessary. And where that work, it generally worked fairly well, where it didn't work. We had mostly sort of failed failed economies because they they weren't able to self govern. But so so that's industries self governance failure. Communities have generally been relative you know, if we think of sort of civil society and, you know, club sports clubs and and other types of, you know, charities and so on, generally been highly successful at self governance. Mostly because of the scale, they were smaller. They knew each other. The stakes were lower. There was less, you know, there was less, to gain by by sort of gaining power of that. So, you know, self governance does work. I mean, you know, it's true that, you know, we've we've still got lots of institutions that have done that, but not in the economy. And I think this is the the fundamental thing that shifted now. So what I I'm relatively optimistic that, you know, this these new tech these these new industries and technologies and capabilities that we've got, the fact that I think a lot of these capabilities are not run by corporate, you know, I think that it's definitely intertwined, but they're they're relatively widely distributed. There is the possibility that self governance, you know, can work this time because we've got better governance tools. We can we've got better ways of of communicating, better ways of keeping track of who's involved, better ways of making collective decisions and enforcing those collective decisions. I mean, that's that is what blockchains have given us is a new new technologies for collective action and in, you know, and and creation of that. But the, you know, the the challenge here is is, we still live in a world of very large corporate players, particularly in tech and and finance. Those aren't large there's aren't just large companies. Those are those are multinational or or multistate sort of companies that span the world. They have enormous power. The only thing that's powerful enough to stand up to that is you know, a consortium of nation states, not just one or two. So, you know, we've that that sort of balance between these two leviathans that we that we have, I'm hopeful that self governance has now the new tools to to begin this, you know, Cambrian explosion of new institutional exploration and so on. You know, the tools are there, the will is there, the capabilities there. But, you know, we still live in the world we live in and and which makes poly you know, the my my point there is that this is inescapably political. This has to be done through political means because of because of those things. But, yeah, I I mean, my my concern at the moment is actually or in in terms of politics is just the risk of, the education side of it. Just a lot of politicians, you know, I don't know quite what it's like in Europe per se, but in Australia and America, for instance, you've just got a you know, tech isn't a high focus or tech is usually something that is very easy to rally populist hate against.

Yeah. Like, I mean, I I I strong agree on that. I think this is this is this is the opportunity for the revolution. Right? This is a bottom up revolution of groups of people coming together and self governing and and and because they can. Because these these tools and capabilities, these these new tools and capabilities now exist to do that. But I think what my point is is that I I still think that's gonna be an evolutionary experimental process

Yeah. That's that's the right question to ask. So I I think, on the one hand, there's there's some barriers that are just a lot of the sort of regulatory infrastructure that we have is designed to control the existing institutions, and it is just often toxic for new institutions. So there is I I I think we will need a period of deregulation then deregulation as we deregulation to break it all up, then reregulation to firm it back up again. But there's there's that. And that's that's a job for politicians and lawyers and so on to to to and and, you know, and activists to work at that process. The the two things I think are needed though, the the the constructive rebuilding phase of this. One is a digital economy and the types the of the type we're about to enter into can have far more complex institutions than an industrial economy. The you know, a step change in the order of complexity of the institutions it can have. And I mean this in a in a literal sense of we can stuff a hierarchy inside a market and wrap a commons around us and then, you know, slice it in half and then repackage it with a you know, we we can just modular we we can sort of modularly assemble institutions to an almost arbitrary complexity now because we can keep track of them, because all of this sort of computational information costs of dealing with the complexity. You know, bureaucracy and administration, which used to be a huge cost that would be like a third of the economy, the industrial economy, has you know, it's not gonna go to zero, but it's it's it's orders of magnitude fallen. And how we're gonna spend that, you know, because that cost has fallen, we're gonna buy a lot more complexity. And that enormous richness of the complexity sort of menu is is is so we need to we need to be able to handle that. To do that, we need toolkits. We need we need, you know, the equivalent of, you know, dashboards and keyboards and infrastructure for me to be able to desktop design institutions. And that notion of institutional design, the idea that, you know, okay. We've come together as a community. We need to do a thing to build an economy for our purpose. What's the sort of, you know, what's the engineering sort of, you know, toolkits that are available to me? Because at the moment, it's I go to a lawyer, the lawyer says, you need a corporation or you need a or you need a this. And it's like, okay. Fine. Is are there any other options? Like, no. That's it. Those are your options. So we're entering a world where we need these design governance design tools, that that reflect that sort of rich institutional complexity. And I think, you know, we're seeing the very, very early stages of this with DAO tooling. We're seeing the very early stages of this with, you know, various, you know, tokenomics and so on. I mean, again, this is primitive compared to where we're going. But the point I'm making here is that stuff is not being done by professionals off in the distance. That's something that you will be able to you you know, it it'll be a, a that's also at that institutional design at the edges. So we need a bit of tooling and capabilities and education and skill sets to be able to do that. And I think, to me, that's the challenge. And there's a there's a, you know, you've now got the cape you know, we will now have the capabilities to design far more complex institutions than any of our ancestors could even imagine. And, you know, we don't do that. I don't know. There's a tiny handful of us on Earth even think about the idea of, you know, designing economies. But we're about to enter a world where that's a relatively regular thing. And not just not just real economies. This could be in game economies. This could be for entertainment. This could be all sorts of things. But just that sort of toolkits and design suites for designing institutions and simulating them and testing them out and just seeing whether they're whether they work or not. But, to me, that's the positive, you know, what do we need to do to get to where we're going is we need to sort of start taking that that seriously as a as a new capability, a new profession, a new skill set, and and build tools for that. But I'm I'm optimistic we're gonna get there with that. Like, I think, you know, it's it's not gonna be immediate. But and the the versions that we have in front of us right now are pretty primitive. Anyone who's ever worked in sort of doubt tooling will know. But, but that's a that's an order of magnitude step change in the capabilities that we've had, you know, a generation ago.

Yeah. So I've always understood that to mean to the to the the idea of what you mean by institutions, where you've got, this this process of creating a an institution or creating sort of governance and rules around the group of people coming together with shared purpose, to, you know, to build an economy inside that, to build a social system, to build a cultural system, you know, to build whatever they whatever they they sort of want within that. But so first of all, you're absolutely right. We don't have a word for that, and we're missing a word for that crucially important concept. You know, in in market economies, we definitely have a word for it. It's entrepreneurship or startups or, you know, this this process of creating a firm that that grows and organizes resources and and so on. We don't have the same word for institutions of of this process of creating an institution, building a commune of community growth around that, which is why I love this sort of the institutional idea. But the other thing to note is, you know, when we say toward markets, I mean, market systems for an economist are just property rights plus prices. And the property rights system describe how you how how, you know, the the rights of exchange of of goods and services and trade and so on. And prices are just the the information mechanism for doing the allocation on top of that. The the word the the part that's always missing from that description of markets is in a institution that enforces those property rights or creates those property rights, which is always the state. And so when we can start to have a word that describes this process of institution creation, we're also we're also creating the space to understand new forms of collective property and new forms of innovation and property rights or governance rights or bun different bundling of of of how we do that. So I sort of see this as not just a massive massive, space design space of institutions, but also a massive design space of property, new types of property, that at the moment we've had, you know, private property, there's public property, and there's kind of some one or two weird things in the middle. Whereas what we actually need is this multidimensional array of all sorts of different weird types of property that that, that that are determined or or structured by the institutional the institutions that we create. So, you know, when we're creating institutions, we're not just creating governance or collective decision making. We're also creating collective decisions about what ownership means of of things or stuff or, whatever in that space. And, which then gives us, you know, maybe different ways in which markets will work or auctions will work or price systems will work or whatever in the background there. So I think this this you know, just thinking of this as this is not just creating new institutions as a way of, you know, what are the rules by which we govern ourselves and make collective decisions. It's also once we have those, those then structure the space of the types of property that can exist, the types of the way in which those bed the different forms of property work. And, again, this is this is not just physical property. This is intangible property and all sorts of other sort of resources that we can collectively create, including ones that don't exist yet. The the sort of ones that are subject to innovation that we're collectively coming together to imagine and invent new ideas and and and put them into the, you know, and and create a and create new types of resources, to be used in in all sorts of different ways. So this this notion of of, you know, what I think why digital economies are exciting to me as an economist is I think most of the types of economies that could exist are in that space going forward. And if we look backwards in history, we've had relatively narrow space of economic choice that has often been institutionally polarized into various extreme forms just because of the enormous complexity costs of those. Digital economies have far lower institutional costs, which means they can be far more complex. Because they can be far more complex, they can explore more of the institutional space. Because they can do that, there's a lot more different types of properties and resources and innovation that can exist. And, you know, that that feels like we're just right at the beginning of actually getting economies to work in a way that that serves the that become that serves the needs of people and communities and so on and and minimizes all of the harms that sort of power and dictatorships and other sorts of, you know, pathologies can can come into them. And, you know, the long twentieth century was just a big fight about the nature of, you know, pick a pathology. Which one do you want? Dictatorship or chaos? And and the correct answer was neither of those things. We don't we don't want, you know, we we want institutions that are fit for purpose, that serve human needs and enable human flourishing and and minimize all of the sort of social costs that that that incur in that sense. So, you know, in that sense, broadly, that's why I'm I'm, you know, I'm in the Balaji, tear it all down and start again. But I I I don't think where he argued that we would in you know, that this means a large political fight. I I don't think that's where this goes.

where they can keep up with you and your work. Yeah. Thank you. So I I work at RMIT University in Melbourne, Australia. You can follow me on Twitter, professor Jason Potts, or email me at any time. You can find that that there. But, yeah, check us out at the Blockchain Innovation Hub at RMIT University.