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Trust Economy: Reputation As Currency
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Trust Economy: Reputation As Currency

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Because of the global connections of the Internet, open to almost anyone, we are moving from an economy where capital is finite and concentrated at power centers to one of the infinite capital of ...

Because of the global connections of the Internet, open to almost anyone, we are moving from an economy where capital is finite and concentrated at power centers to one of the infinite capital of trust and reputation. Based on my blog post at http://newmedialeaders.com/community/trust-the-currency-of-the-new-economy-423/

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    Trust Economy: Reputation As Currency Trust Economy: Reputation As Currency Document Transcript

    • Trust Is The New CurrencyThe Trust Economy Created with Haiku Deck Photo by John ONolan By Mark Traphagen page 1 of 15
    • Trust Is The New CurrencyWhy do people stop at red lights?Why do people stop at red lights? Sure there is the fear of possible punishment from lawenforcement if you don’t. And there is the risk of being hit by someone coming the other way.But a mass disobedience by all the people encountering any given red light could obviateeither of those in a moment. But that doesn’t happen. 99.99% of the time, people stop. Created with Haiku Deck Photo by bnicholephoto By Mark Traphagen page 2 of 15
    • Trust Is The New CurrencyCooperation is how we surviveI submit that the primary reason they do is a conditioned understanding of the value ofcooperative trust in a social system. My stopping on red gives someone else a chance to go;and the mutual stopping of others allows me to go in my turn. Through this unspoken butpowerful social transaction, we all get where we are going faster and more efficiently.Sure the punishment and injury threats strongly reinforce this behavior, but I still believe atits core is an innate knowledge, programmed into us by evolution, that cooperation based ontrust aids the survival and thriving of our species. Created with Haiku Deck Photo by Jeremy Brooks By Mark Traphagen page 3 of 15
    • Trust Is The New CurrencyTrust and Collaborative ConsumptionAll economies are built on a similar social trust in some form. Created with Haiku Deck Photo by crol373 By Mark Traphagen page 4 of 15
    • Trust Is The New CurrencyIndustrial EconomyIn the capitalist economies of the Industrial Age, we were asked to place that trust in largeinstitutions, primarily banks that control the capital and governments that regulate its flow.While that economic model built great and mighty things, it also thrived on scarcity and finitegames resulting in a few big winners and lots of lesser players (or losers). Created with Haiku Deck Photo by nikzane By Mark Traphagen page 5 of 15
    • Trust Is The New CurrencyConnected EconomyIn the emerging connected economy trust and the capital that flows from it are increasinglydecentralized and distributed. Now it is possible for virtually anyone to become a center oftrust and reputation in any given field. And from that center can flow capital (in all forms, notjust money) and power/influence. Created with Haiku Deck Photo by Jean-François Chénier By Mark Traphagen page 6 of 15
    • Trust Is The New CurrencyRachel Botsman: Collaborative Consumption"Collaborative Consumption: A social and economic system driven by network technologiesthat enable the sharing and exchange of assets from spaces to skills to cars in ways and on ascale never possible before."- Rachel Botsman(from http://youtu.be/kTqgiF4HmgQ) Created with Haiku Deck Photo by Halans By Mark Traphagen page 7 of 15
    • Trust Is The New CurrencyExchanged Space: AirBNBAirBNB is an online service that connects people with extra space (from a spare bedroom to aspare medieval castle) with people looking for a place to stay in a particular city. It has takenoff incredibly, with people now in 192 countries willing to open their homes and spare spacesto strangers.At the core of the success of AirBNB is an effective trust rating system based on reviews.Both guest and host can be reviewed. The benefit for hosts is obvious, but what is differentand powerful here is the benefit for guests from such a rating system. A frequent guest whoearns a high rating can command special deals and preferences from potential future hosts.Reputation has its perks. Created with Haiku Deck Photo by calitexican By Mark Traphagen page 8 of 15
    • Trust Is The New CurrencyOnline Networks Build Economies of TrustAccording to Ms. Botsman, ”It’s about empowering people to make meaningful connections,connections that are enabling us to rediscover a humanness that we’ve lost somewherealong the way…Instead of consuming to beat the Jones’s, consuming to get to know theJones’s.”A study by the Pew Research Center found that “the typical internet user is more than twiceas likely as others to feel that people can be trusted.” Online connections really do helpestablish reputation which turns into the power of trust. Created with Haiku Deck Photo by Robert Bejil By Mark Traphagen page 9 of 15
    • Trust Is The New CurrencyReputation Is Contextual & Needs ScoringJust because you’re trustworthy in one thing doesn’t mean you are in another. An individual’s“Reputation Capital [is] the worth of her reputation–intentions, capabilities, andvalues–across communities and marketplaces.” Rachel Botsman envisions that in thenot-distant future there will be apps that will allow us to access the earned reputation ofindividuals across a broad array of categories. Created with Haiku Deck Photo by Government Press Office By Mark Traphagen page 10 of 15
    • Trust Is The New CurrencyReputation As CurrencyThere are already startups working on this. Reputation will become the most powerfulcurrency in the 21st century. And it will make a number of staples of the 20th centuryindustrial economy obsolete: credit scores, resumes, headhunting services among them. Created with Haiku Deck Photo by Nathan Congleton By Mark Traphagen page 11 of 15
    • Trust Is The New CurrencyA Future of Wuffie?All individuals in Cory Doctorows novel Down & Out in the Magic Kingdom have implantedbrain chips that are able to transmit and record wuffie. Wuffie is simply the cumulative scoreof reputation garnered from others who have encountered you. If you do something amazingor beneficial, your wuffie will go up. Be rude to someone or break a promise, and your wuffiemay go down. Wuffie can be consciously sent to another, but most transactions take placeautomatically and unconsciously as the brain chips simply measure and transmit thesentiments of one human being toward another. Created with Haiku Deck Photo by Etrusia UK By Mark Traphagen page 12 of 15
    • Trust Is The New CurrencyAuthorRank Trust ScoringAuthor Rank (sometimes expressed as “AuthorRank” in homage to Google’s PageRank) is acommunity-created term for something Google has talked about, in patents and elsewhere,for several years now. The idea of Author Rank is to use Authorship to trace the social signalspointing at a given author’s content on a given topic and score the author in that topic by theamount of social trust signals directed toward it. Most importantly for our reputation creditdiscussion here, more important than how many people engage with a given piece of contentis who does. If a person who also has a high trust ranking for “Google search” often interactsfavorably with my Google search-related content, that will count for more for me in that topicthan a lot of non-authoritative people doing the same. The resulting score would serve as aboost to the author in the search results when people search for the topic Created with Haiku Deck By Mark Traphagen page 13 of 15
    • Trust Is The New CurrencyBuilding Wuffie in a Reputation EconomyIf reputation is the currency of the new economy, how does one build up such capital. Someof the ways should be obvious from our current experience. Create a high-quality product orservice. Provide exceptional customer service. Deliver more than is promised.But there is another factor which I think will be many times more powerful in the connectedeconomy than it was in the industrial economy: the power of giving it away.In the connected economy, giving away will be a major way of directly earning capital. Notthe old-style capital of money or money-related credit, but the new capital of reputation. Bygiving in ways meaningful and helpful to others in online communities, they begin to sendmajor wuffie your way as they share your content, rate you favorably on rating services, andrecommend you to their friends. And as we saw above in the Google example, the web ismaturing in a way that can rapidly expand and spread the capital value of such good Created with Haiku Deck By Mark Traphagen page 13 of 15
    • reputation. Created with Haiku Deck Photo by Tim Simpson By Mark Traphagen page 14 of 15
    • Trust Is The New CurrencyA Trust Economy Fosters AbundanceWhat are you doing right now to build your reputational capital in the emerging connectedeconomy?(This Haiku Deck is based on my more extensive article "Trust: The Currency of the NewEconomy" athttp://newmedialeaders.com/community/trust-the-currency-of-the-new-economy-423/) Created with Haiku Deck Photo by Paco CT By Mark Traphagen page 15 of 15