Toward a New Social Contract for the Digital Economy Don TapscottBlockchain Research Institute January 2018 Realizing the new promise of the digital economy In 1994, Don Tapscott coined the phrase, “the digital economy,” with hisbook of that title. It discussed how the Web and the Internet of informationwould bring important changes in business and society. Today the Internetof value creates profound new possibilities. In 2017, Don and Alex Tapscott launched the Blockchain Research Instituteto help realize the new promise of the digital economy. We research thestrategic implications of blockchain technology and produce practicalinsights to contribute global blockchain knowledge and help our membersnavigate this revolution. Our findings, conclusions, and recommendations are initially proprietary toour members and ultimately released to the public in support of our mission.To find out more, please visitwww.blockchainresearchinstitute.org. Blockchain Research Institute, 2018 Except where otherwise noted, this work is copyrighted 2018 by theBlockchain Research Institute and licensed under the Creative CommonsAttribution-NonCommercial-NoDerivatives 4.0 International Public License.To view a copy of this license, send a letter to Creative Commons, POBox 1866, Mountain View, CA 94042, USA, or visitcreativecommons.org/licenses/by-nc-nd/4.0/legalcode. This document represents the views of its author(s), not necessarily thoseof Blockchain Research Institute or the Tapscott Group. This material is forinformational purposes only; it is neither investment advice nor managerialconsulting. Use of this material does not create or constitute any kind ofbusiness relationship with the Blockchain Research Institute or the TapscottGroup, and neither the Blockchain Research Institute nor the Tapscott Groupis liable for the actions of persons or organizations relying on this material. Users of this material may copy and distribute it as is under the terms ofthis Creative Commons license and cite it in their work. This document maycontain material (photographs, figures, and tables) used with a third party’spermission or under a different Creative Commons license; and users shouldcite those elements separately. Otherwise, we suggest the following citation: Don Tapscott, “A Declaration of Interdependence: Toward a NewSocial Contract for the Digital Economy,” Blockchain ResearchInstitute, 29 Jan. 2018. To request permission for remixing, transforming, building uponthe material, or distributing any derivative of this material for anypurpose, please contact the Blockchain Research Institute,www.blockchainresearchinstitute.org/contact-us, and put “Permission request” insubject line. Thank you for your interest! Contents Executive summary4 The Fourth Industrial Revolution8Globalization9Demographic upheaval10Climate change10 Nine disruptions: The current contract isbreaking Four pillars of society31 A new social contract for the digitaleconomy: New directions33 A new social contract: Economic33A new social contract: The state43A new social contract: Society50 How do we get there? Throughmultistakeholder networks58 Executive summary Brexit and Donald Trump were a one-two punch, hitting the worldin the face. People everywhere are “mad as hell and they’re notgoing to take it anymore.” As such they have become vulnerable topopulism, xenophobia, and scapegoating any minority—any groupthat represents a difference, be it ethnic, race, gender, or religion—for their circumstances or even the consequences of their owndecisions. Centrist parties are in rapid decline and extremist; right-wing partiesfrom Hungary and Poland to France and Germany are on the rise. Inother countries, particularly in southern Europe where memories offascism and dictatorship are still vivid, the left is ascendant. Perhaps as unthinkable as the success of Donald Trump is that ofBernie Sanders, an avowed socialist who almost won the democraticpresidential nomination, and who some think could have beatenTrump in the general election. The unfolding story is one of growingdiscontent with the deepening economic crisis and the establishmentthat created it with impunity. As the digital revolutionunfolds it is drivingprofound changes in theglobal economy, labormarkets, old institutions,and society as a whole. The world has seen this story before, in the run up to the SecondWorld War, but the analogy is imperfect. Among other things,the rate of change differs. As the digital revolution unfolds it isdriving profound changes in the global economy, labor markets,old institutions, and society as a whole. It is enabling spectacularinnovation and unprecedented wealth creation. At the same time,growing social inequality, the decline of the middle class, andpernicious unemployment and underemployment are fueling unrest.Networks enable outsourcing, offshoring, and the globalization oflabor markets. Government architectures and policies have not evolved and there is