How Netflix’s Algorithm Explains the Modern Economy

A small reading that will make you think

You open Netflix. You’re not sure what you want, maybe a documentary on the mafia, maybe a teenage vampire drama.

But somehow, Netflix knows.

It offers you a title you’ve never heard of, from a country you’ve never been to, and you click play without thinking twice.

But this isn’t a story about Netflix, it’s about a possible revolution in economics.

The Preference Revolution

For decades, economists assumed that consumers had stable preferences. You wanted something, producers supplied it, and the market did its thing.

But platforms like Netflix flip that logic on its head. You’re not just revealing your preferences, they’re being shaped in real time.

We’ve entered what you could call algorithmic capitalism. Markets used to wait for us to decide. Now they predict what we’ll want, sometimes before we do.

Demand is no longer discovered, but it’s almost created, engineered.

Netflix is a perfect case study. Its value isn’t in its catalog, it’s in its recommendation system. Two users can look at the same platform and see entirely…