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Technological progress and economic development are inevitably accompanied by changes in social systems. The government needs to accelerate the implementation of reforms in terms of system design and policies and regulations and optimize system supply. The system not only affects the direction and intensity of technological innovation, but also determines whether production factors such as capital and labor can be effectively allocated to new technologies and industries. Therefore, effective system supply is crucial.

Author |Liu Cheng

Image source |Tuchong Creative

Driverless taxis are coming unstoppably. Baidu has deployed 1,000 Carrot-style driverless taxis in Wuhan, and has received 5 million orders in total. In this era of rapid technological change, technology always brings many surprises to people, but now in the city of Wuhan, the emerging driverless taxi industry is a mixed blessing. Some people cheer for technology, while others worry about vehicle accidents.

A thrilling leap between technological revolution and industrial transformation

Science and technology are the foundation of a country's prosperity, and industry is the material basis of modernization. The development of science and technology and industry is the only way for a country or region to modernize. In global history, the rise of countries such as Britain, the United States, and Japan is closely related to scientific and technological revolutions and industrial changes.

On the one hand, scientific and technological revolution and industrial transformation are inevitable in the development of history. Countries or regions that try to block or delay it will eventually lose in international competition. On the other hand, scientific and technological revolution and industrial transformation do not occur in all eras, but only suddenly come in a few periods. Therefore, countries and regions that fail to seize historical opportunities in time will miss the future of a generation or even several generations. Fortunately, in the critical period of China's modernization construction, we have ushered in a new round of scientific and technological revolution and industrial transformation.

Throughout history, the combination of scientific and technological revolutions and industrial changes has been a process of leaps and bounds; but from the perspective of specific time nodes, the combination of science and technology and industry is a continuous process with a traceable path.

The long-term accumulation of science and technology and the major breakthroughs in disruptive technologies are the precursors, and then capital is transformed into commercial production activities under the motivation of pursuing profits. This leap in commercialization and marketization is a thrilling leap from scientific and technological revolution to industrial transformation, and it has achieved a leap in productivity. Moreover, this leap usually occurs first in one or a few fields, and then continuously expands production and social reproduction, and finally extends to all industries in the whole society and people's daily lives.

Historically, the steam engine and textile machine of the first scientific and technological revolution and industrial transformation, the electric light, telephone and telegraph of the second scientific and technological revolution and industrial transformation, and home appliances, computers and automobiles of the third scientific and technological revolution and industrial transformation all followed this path.

At present, driverless taxis are the key node where the new round of scientific and technological revolution and industrial transformation meet. The story happening in Wuhan is also a thrilling leap from scientific and technological revolution to industrial transformation. This leap surprised and frightened many people. But in essence, this leap is still the industrialization, commercialization and marketization of cutting-edge technology.

From the perspective of global science and technology history, only by following the trend of scientific and technological revolution and industrial revolution can we achieve twice the result with half the effort in economic and social benefits. What we need to do is to provide a more relaxed institutional environment for industries such as driverless taxis and design corresponding regulatory rules for them to make the leap less thrilling.

On the contrary, the lag in reform will slow down the pace of technological innovation and industrial commercialization. Historically, the UK has been forced to require that a person waving a red flag 50 meters in front of the vehicle to guide it on the road due to its rigid system, and the speed of the vehicle could not exceed 4 miles per hour, thus restricting the development of the automobile industry.

If we simply restrict the transformation of technology into industry, driverless taxis will be strangled, ChatGPT (the American head conversation large model product), artificial intelligence robots, etc. will be suppressed, and new development opportunities will be lost.

Industry prospects and security governance

Objectively speaking, if driverless taxis and autonomous driving drive market demand, it will in turn drive investment. The huge profits brought by the mass production of new technologies will often drive companies to expand investment, thereby creating new jobs. Some industries with advanced productivity are getting bigger and bigger. This is a process of upgrading the industrial structure and the development of new quality productivity, which is unstoppable.

Not only in the taxi industry, but also in the fields of low-altitude economy and industrial robots, the application of artificial intelligence technology has been very extensive and in-depth. For example, the Chongqing Seres Automobile Super Factory rolls off two new energy vehicles per minute. In this global benchmark digital factory, more than 3,000 robots can work together intelligently to achieve 100% automation of key processes; using quality automation testing technology, 100% quality monitoring and traceability are achieved.

Although we may not be aware of many of the modern conveniences that artificial intelligence has provided, we are slowly and almost passively relying on this technology. We neither pay attention to the fact that we are dependent on this technology nor understand the impact of this fact.

Kissinger wrote in his book Artificial Intelligence: The Future of Humankind: Artificial intelligence will blend unnoticeably into ordinary life, subtly shaping our experience in a way that appeals to our intuition.

At present, the arrival of driverless taxis is a big deal, but in the long run, its impact will be subtle. When people no longer pay attention to and discuss it, it means that the technology has been widely integrated into people's lives, just like e-commerce, shared bicycles and other new business forms and models in the past.

It is particularly important to point out that China does not have a technological advantage, equipment or material advantage in developing the artificial intelligence industry, but it does have a data advantage. Only by allowing the technology to be implemented or applied locally can we input a large amount of long-tail data and continuously improve its algorithms. Chinese manufacturers do not have an advantage in algorithms, but the cost of collecting data is relatively low. China's data advantage can promote technological iteration, thereby attracting technology companies such as Tesla to settle in.

Many people may be more concerned about safety issues. Recently, a Wuhan netizen posted a short video saying that Baidu's autonomous driving travel service platform "LuoBoKuaiPao" driverless taxi collided with pedestrians on the streets of Wuhan, which aroused social concern. It is undeniable that artificial intelligence is radically reshaping people's working and living environment.

In May this year, the world's first integrated construction platform for prefabricated buildings, created by China Construction Third Engineering Bureau, was first used in the Wuhan Hanxin Mansion, a smart construction pilot project. The platform includes multiple devices required in the building construction process, like a movable three-dimensional factory, which can create a factory environment on the construction site.

However, changes to the environment are bound to have an impact on humans, with safety issues being the first to be affected. Tencent Research Institute recently published an article stating that robots are AI with physical form, existing in three-dimensional physical space and social and economic production relations, so the incompatibility between robots and the environment should not be ignored. This includes both the physical environment such as cities, buildings and roads where driverless taxis operate, as well as the social environment such as the economic relationship between the platform and passengers, traffic rules, accident handling, laws and regulations.

In fact, from the number of orders for driverless taxis in Wuhan, we can find that passengers' trust in the safety performance of driverless taxis exceeds our expectations, so it is not appropriate to exaggerate the safety risks of driverless taxis. Moreover, driverless driving avoids safety hazards such as human fatigue driving.

To take a step back, accidents involving human-driven taxis are extremely common, so why must driverless taxis be one in ten thousand times safe?

Some people believe that if driverless taxis are unsafe, they may be systemically unsafe, which may bring greater potential harm than individual human traffic accidents. In addition to safety, people are also concerned about whether the platform will set monopoly high prices to harm consumer interests after squeezing out drivers at low prices.

Well, there are actually three real issues that we need to reflect on. First, driverless taxis can make mistakes, but they cannot be technical or systemic mistakes. This is a problem for the company as well as a technical problem, which requires the accumulation of data and the improvement of technology. Second, if driverless taxis have safety problems, how will the car manufacturers, platforms (car operators), and passengers share the responsibility, and how will the government supervise? This is a social regulation issue, and also the most difficult issue to govern. Third, there is the issue of platform monopoly.

How to embrace the technological revolution and industrial transformation

Emerging industries represented by driverless taxis reflect the thrilling leap from scientific and technological revolution to industrial revolution, and the transition to new quality productivity. Changes in the employment structure of workers, chain reactions in other industries and other economic and social pains are also the inevitable result of industrial transformation and upgrading. Therefore, under the big historical perspective, we do not avoid problems, but insist on embracing the direction of scientific and technological and industrial development.

We need to use reform to deal with the problems in development. At present, a new round of scientific and technological revolution and industrial transformation is developing in depth, global scientific and technological innovation is unprecedentedly intensive and active, and a number of cutting-edge technologies and industries with explosive potential are on the eve of emerging and turning into butterflies.

The birth and evolution of scientific and technological revolutions and industrial changes require institutional reforms. Looking at the first three scientific and technological revolutions and industrial changes, technological innovation often takes place first in countries with specific institutional arrangements and business environments. Only by providing stronger property rights protection and a fairer market system can latecomers achieve new technologies and new industries.

The famous historian Arnold Toynbee attributed the achievements of Britain's Industrial Revolution to a large extent to market-oriented reforms, believing that the essence of the Industrial Revolution was to replace the various medieval rules and regulations that previously controlled the production and distribution of wealth with competition.

In order to adapt to the general trend of a new round of scientific and technological revolution and industrial transformation, we must further strengthen market-oriented reforms and provide a relaxed social environment for new technologies to be put into production and enter the market.

In recent years, my country's science and technology and industry have achieved rapid development, and have achieved catch-up to a certain extent. Recently, the World Intellectual Property Organization released a report showing that from 2014 to 2023, China's generative artificial intelligence patent applications exceeded 38,000, ranking first in the world, 6 times that of the second-placed United States.

However, some cutting-edge, highly uncertain disruptive technological innovations are full of uncertainty for both Chinese and foreign companies, making it impossible to list a catalog of technologies to make up for shortcomings and a path to catch up. This requires giving full play to market forces, encouraging the spirit of contract and entrepreneurship, creating an innovative atmosphere and encouraging companies to conduct large-scale innovative experiments based on technological development trends. We need to actively promote inclusive and prudent supervision while maintaining the bottom line of safety, and give new technologies sufficient innovation space and necessary trial and error space.

According to official information from Baidu, LuoBoKuaiPao is an autonomous driving travel service platform launched by Baidu Apollo. It has opened manned test operation services in 11 cities including Beijing, Shanghai, Wuhan, Chongqing, etc. In addition to Wuhan, the first batch of driverless taxis in Shanghai are also ready to hit the road.

In addition, Tesla's FSD fully autonomous driving technology has been approved for use in China, and the second half of the electric vehicle market will also be fully launched. It should be pointed out that compared with the popular tourist cities, Wuhan has become the "first city for autonomous driving" and has a stronger driving effect on the local automobile industry, advanced manufacturing industry and platform economy.

It can be said that disruptive technological innovations represented by autonomous driving are highly dependent on the spontaneous market order. The focus of reform is to recognize the rationality of this spontaneous market order and provide institutional recognition for the organizational forms spontaneously formed by the market.

Technological progress and economic development are inevitably accompanied by changes in social systems. The government needs to accelerate the implementation of reforms in terms of system design and policies and regulations and optimize system supply. The system not only affects the direction and intensity of technological innovation, but also determines whether production factors such as capital and labor can be effectively allocated to new technologies and industries. Therefore, effective system supply is crucial.

(The author is an associate researcher at the Institute of Financial and Economic Strategy, Chinese Academy of Social Sciences)

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