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Person

Dan Davies

Guest; economist and author, The Unaccountability Machine

Former Bank of England economist turned writer, focused on the parts of the economy conventional economics ignores by assuming perfect information and perfect rationality. Author of The Unaccountability Machine, long-listed for the Financial Times Book of the Year and winner of the New Statesman's Book of the Year. Argues real-world organizations and markets run on "partial information" — humans and institutions constantly simplify an overwhelming world into manageable models, and most catastrophic organizational failures trace back to a system built on an outdated or oversimplified model of the world, not to any individual's malice or incompetence.

Coined "unaccountability machine" for a system structured so that no identifiable human being owns a given decision, and "accountability sink" for the specific customer-facing interactions (an airline desk agent, a call-center script) where a person must field the emotional consequences of a decision they had no part in making. Uses the 1999 KLM squirrel-shredding incident as his founding case study (see KLM Schiphol Squirrel-Shredding Case), and extends the framework to Fox News's Dominion libel settlement, the Boeing 737 MAX crashes, and business patterns of single-goal fixation destroying the thing an organization originally set out to build (see Fox News Dominion Libel Unaccountability Case, Boeing 737 MAX Unaccountability Case, Single-Goal Fixation Business-Decline Cases). Also discusses the UK A-level appeals system as an example of individually-fair rules combining into a systemically biased outcome (see UK A-Level Appeals-System Bias Case), and cites economist Charles Goodhart's "Goodhart's Law" to explain why online review systems (Google, Trustpilot) get gamed once they become a measured target (see Goodhart's Law Review-Gaming Case).

Discussed in

  • Episode 255 — 255-when-schiphol-airport-shredded-400-squirrels-and-why-no-one-was-to-blame

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