maanav's thoughts

should attention be taxed?

I saw this tweet today and it got me thinking:

If you follow Balaji, you remember his $1 million “Bitcoin” bet on the US entering hyperinflation. This is playing out again today, with people betting large amounts of money to discuss vaccine (mis)information.

Of course, Balaji didn’t actually think the price of Bitcoin would reach a million; he just burned that money so he could get your attention to the US printing trillions of dollars. I’ve always viewed capital allocation as a way to impose your worldview on the world, and it seems like capital can be allocated to buy people’s attention to things you care about.

If you’ve read Hayek’s The Use of Knowledge in Society (and it’s fine even if you haven’t), this reminded me of Hayek’s idea of the price system as humanity’s solution to the problem of resource allocation:

“In a system in which the knowledge of the relevant facts is dispersed among many people, prices can act to coordinate the separate actions of different people in the same way as subjective values help the individual to coordinate the parts of his plan”

For example, if one of the major sources of supply of corn disappears tomorrow, corn would become more scarce and the price of corn would increase, allocating corn to where it’s most profitably used.

If we consider attention to be a market, people making million-dollar bets to raise awareness effectively means that they’re expressing a price on your attention. And this isn’t something new: the advertising industry has been placing a price on your attention for decades now.

This makes us question though: is attention an efficient market? With short-form videos and trendy controversies swallowing up so much of human attention, it seems that even though attention has a price, it’s not allocated to where it could be best used.

Traditionally, governments have intervened in markets to correct inefficiencies, using things like subsidies or taxes to encourage/discourage production or consumption. And so, since attention is a market and it’s inefficient, what if the government intervened in this market too?

I’d argue that we already have subsidies on attention; things like public grants for scientific research, for example, serve to allocate human attention to where the government thinks it’s most needed. What we haven’t really seen though, is attention taxes.

Imagine a country where creators had to pay a tax every time they promoted their content on TikTok, or where people had to pay a small fee when they engaged in the hot new debate on Twitter. I’m not saying that this should exist, but I think it’s definitely worth questioning whether human attention could be better allocated and how we could do this safely.

If you’ve read this far, thanks for deciding to spend some of your attention on my thoughts. Hopefully you thought it was an efficient allocation.