Chris Anderson, author of The Long Tail, spoke this morning at Pop!Tech about non-monetary economics — a cheery idea, given the current state of monetary economics.
Non-monetary economics, he says, are things like reputation and attention — valuable properties, but traditionally hard to quantify. That is, until Google came along.
"Google measures somebody’s reputational assets, turns it into a page rank, and determines search traffic," says Anderson. That traffic can then be converted to money. Think of the conversion this way: Links to page rank to search to traffic to ads to money. Like currency conversion rates in international banking, the conversion rate for reputation is now getting quite formal.
"We now have a central banker for the internet economy," Anderson says. "Larry page is the Ben Bernake of the Google economy, since he controls page rank."
There are limits, Anderson says. "Larry Page can’t convene a summit of internet bankers to set conversion rates." Even when Google tried to institute a "No follow tag" — an attempt to deflate link currency by stopping spammers, it was only about as successful as Bernake’s infusion of funds has been to stabilizing the market
Right now, Anderson says, "Larry is more like a European national central banker giving over his currency to the EU."