Appendix – Answers to Question 4 from the SAF 5 report

1. Encourage interoperability; don’t pick winners; deal properly with failures Government policies based on models of technological change with strong evidential support will be more effective than those based on discredited models. • Since technology evolves in a complex and largely unpredictable way, keep multiple technology options open (e.g. general purpose technologies) and avoid picking specific technological winners. • New technologies are the major driver of economic growth and provide large national benefits. However, failures are inevitable with anything new. Thus government policies should deal more explicitly with failure – acknowledge it will occur, and prepare for it. Government should conduct proper experiments (declared as such with clear expectations, means of measurement, and a commitment to publish the results). • New technologies often substantially improve the average welfare of the country, whilst at the same time harming the welfare of subsets of citizens. Policy which explicitly recognises these differential impacts (and mitigates them by social safety nets) removes a brake to progress. • Much government regulation concerns technology. The evidence suggests Government should regulate by effects, rather than by technology. • Technological standards can enhance interoperability which can improve outcomes for all. Governments should focus upon interoperability (rather than standardisation in itself), and be wary of dangers of premature lock-in (which can be a self-interested business model).