Why do we Need Economists in Blockchain?
In my recent post, “Who is an economist?”, I proposed a straightforward definition to establish who is an economist.
Today, I want to address why I fundamentally believe the blockchain space would greatly benefit by having more economists dedicating their expertise to this industry.
One of the first conversations that I have with potential clients includes the explanation of economists’ role within the blockchain world. In searching for an analogy to express this in a clear and simple to understand fashion, I have found it effective to compare the relevance of our work with that of physicists working in the aerospace industry.
In exploring this, let’s consider that instead of a computer scientist or programmer developing the next revolutionary blockchain protocol or dApp, a founder is an aeronautical engineer working for SpaceX in an attempt to build a new space shuttle to bring humans to Mars.
This new space shuttle would be a monumental breakthrough in the aerospace industry — just like blockchain is to the information technology industry.
As groundbreaking as this advancement might be to the aerospace industry, many of the core laws of physics (Newton’s third law and Bernoulli’s principle, for example) still apply to the flight calculations and success of the new space shuttle. Different as its technology may be, the space shuttle’s take off from Cape Canaveral would be subject to the force of gravity similarly to the Kitty Hawk when Wilbur and Orville Wright flew for the first time in human history.
Even if our understanding of physics has significantly improved, the laws of physics governing flights have not changed. They still apply today in a similar fashion as they did at the beginning of the 20th century.
Today, given the current state of technology, aeronautical engineers are able to design planes more efficient than ever before. They are able to do this with the help of science — namely physics. Because of this, despite the continued advancement in technology and understanding, aerospace companies are still among the leading employers of professionals with a PhD in physics — physicists.
In a similar respect, blockchain is the latest step in the advancement of information technology. Entrepreneurs in this growing industry can design the most efficient version of their technology with the help of the applicable science, in this case — economics. They can do so by receiving help from people with a PhD in economics — economists.
Economics, together with technical and legal expertise, serves as one of the three pillars of the blockchain industry. It is my intention in this column to highlight from a layman perspective the fundamental impact economic sciences have in the development of the blockchain industry.
