‘Why Information Grows’, by César Hidalgo

F39024c5-059c-4867-8727-809d730421b5Eric Beinhocker at the Financial Times:

We instinctively think of “information” as a human phenomenon. But modern science sees it as a measure of something more fundamental: as a point on the continuum between perfect order and perfect randomness, the latter being the state towards which, according to the laws of thermodynamics, the universe inexorably drifts. Flows of energy can fight this tide of entropy, allowing order to develop and pockets of information to be stored — cells, brains and ecosystems are all examples of this process. In Why Information Grows, Hidalgo observes that our economy is full of such energy-fuelled pockets of order. All of the products and services around us are examples, and it is the information embedded in these products and services that gives them their value.

For example, Hidalgo notes that a Bugatti Veyron sports car sells for $2.5m. He then conducts a thought experiment, asking the value if one drove it into a wall — presumably less. Yet all of the atoms in the car would still be there (assuming one kept the broken bits). What has changed is the order or arrangement of the atoms in the car. That order reflects the information embedded in the product, which in turn reflects the knowledge and know-how of its designers and manufacturers. One can think of “knowledge” as information that is useful to humans — when it is embedded in a product, it enables that product to do useful things.

more here.