March 28th, 2008 Posted in Readings, Thoughts | 1 Comment »
I spend a lot of time pitching the merits of social media approaches to a skeptical, traditional, policy and international development audiences heavy on economists. Now, some of my best friends are economists and the world would be worse off without the dismal science, but they can be a contrary lot. My talks tend to start with some version of “look how well peer production works” usually including something about Habitat for Humanity and then quickly moving to Linux, Apache, and Wikipedia as demonstrations. The reaction, inevitably, is “this is all very nice, but does it work in theory?”
I gnash my teeth, but the question deserves a sound answer. If we want to promote collaborative, “peer,” production, approaches to policy issues, we have to have a better understanding of when and how they work — what the incentives are. We are making progress on this.
For example, we understand that some of what we often class as “volunteer” effort by amateurs is really paid labor by professionals. The biggest example I know of is IBM’s corporate contributions to open source software — Linux and Apache in particular. Tapscott and Williams, in Wikinomics, say “IBM spends about $100 million per year on general Linux development.” (p. 81) Hindman cites Shankland saying “in 2001 alone, IBM’s contribution to open-source projects was valued at more than $1 billion.” (p. 194) Economists understand these investments — IBM sees these specific software categories as cost centers and actually saves money by leveraging other’s investments in open source products. It is profit maximizing.
But what about contributions to products that don’t have commercial investment? Benkler insists that “we need not declare the end of economics as we know it.” (p. 92) He goes on (chapter 4 is great) to describe the increasing sophistication of economic understanding of behavior with contributions from other fields including psychology and sociology. Benkler concludes:
My claim is not, of course, that we live in a unique moment of humanistic sharing. It is, rather, that our own moment in history suggests a more general observation. The technological state of a society, in particular the extent to which individual agents can engage in efficacious production activities with material resources under their individual control, affects the opportunities for, and hence the comparative prevalence and salience of, social, market — both price-based and managerial — and state production modalities. The capital cost of effective economic action in the industrial economy shunted sharing to its economic peripheries — to households in the advanced economies, and to the global economic peripheries that have been the subject of the anthropology of gift or the common-property regime literatures. The emerging restructuring of capital investment in digital networks — in particular, the phenomenon of user-capitalized computation and communications capabilities — are at least partly reversing that effect. Technology does not determine the level of sharing. It does, however, set threshold constraints on the effective domain of sharing as a modality of economic production. (p. 121)
I don’t disagree (and only partially because I’m not sure I understand what he said!) However, I think Clay Shirky said it better at his recent talk at the New America Foundation. He said the reason peer production can work, what has changed, is that “the radius and half-life of love have increased.” (this is at about 1:11:27 into the video). He pointed out that people are often (mostly?) involved in communal, cooperative, non-monetary behaviors and that the drop in the cost of sharing has just allowed these behaviors to affect more people and “invade the space of neo-classical economics.” In some sense, I can do things for strangers at no more cost than when I was just doing them for my family.
Moreover, Neuroscience is now suggesting I’m hardwired to desire this behavior. Summarizing 2006 research at NIH, the Washington Post reported “The results were showing that when the volunteers placed the interests of others before their own, the generosity activated a primitive part of the brain that usually lights up in response to food or sex. Altruism, the experiment suggested, was not a superior moral faculty that suppresses basic selfish urges but rather was basic to the brain, hard-wired and pleasurable.”
Half-life of love indeed!