Law in the Face of Disruptive Technology, An Introduction
Marta Katarzyna KOŁACZ, Alberto Quintavalla · European Journal of Risk Regulation · 2019
Disruptive innovations provoke controversial political responses.They affect established business models and settled social norms.The question faced by society is whether and how to regulate innovation.The question grows more pressing as innovation grows more rapid.In pre-antiquity, innovation similarly engendered major changes to society.For example, improvements in irrigation technology caused whole populations to migrate to large cities in Ancient Egypt.The pace of social change was, however, comparatively slow, as was the diffusion of technology.It could take hundreds of years for a new technologysay an improvement in agricultureto spread.The resultant social pressures, even if significant, did not require wide-scale interventions into the economy.Indeed, they did not even require the formation of government.But we now live in a time of rapid change: technologies are developing fast, digital economies are emerging and markets are growing more integrated.Netflix rendered DVDs obsolete.What Netflix did to DVDs is what Uber will do to taxis.Incipient technologies, such as nanorobotics and genetic engineering, are widely forecast to revolutionise our lives.The impact of all those technologies is unknown and to some extent unknowable.In the context of that uncertainty, the role of law, legislators, courts and regulators is paramount.At its core, the concept of "disruptive innovation" refers to business models or technologies that challenge incumbent businesses, successfully targeting overlooked market segments.In common parlance, the term has begun to encompass all technological and business breakthroughs which reshape markets.Such innovations lead to a need to reassess the effectiveness of the existing legal frameworks and, if appropriate, to reform the law.The legislator faces a difficult choice: either let judges decide according to the current law, or promulgate new legislation.Although these two options may seem mutually exclusive, they also overlap.Thus, the legislator may decide to let judges decide cases according to pre-existing rules at first.Once the new dynamics are fully understood, new statutes may be drafted or old ones amended.