4. The Economics of Social Production

From Yochai Benkler - Wealth of Networks
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Content

Summary of the chapter

Overview

Motivation

Social Production: Feasibility Conditions and Organizational Form

Transaction Costs and Efficiency

The Emergence of Social Production in the Digitially Networked Environment

The Interface of Social Production and Market-Based Businesses

Sources

Sources cited in the chapter

Other relevant readings

Case Studies

Supporting examples

From page 120-121

"... Goods, services, and resources that, in the industrial stage of the information economy required large-scale, concentrated capital investment to provision, are now subject to a changing technological environment that can make sharing a better way of achieving the same results than can states, markets, or their hybrid, regulated industries..."

John Seely Brown makes the point for sharing even in capital-intensive markets such as the auto industry where he contrasts Toyota's cooperation between and among its suppliers to Detroit's command and control relationships with its suppliers. This is talked about in his new book "The Only Sustainable Edge: Why Business Strategy Depends on Productive Friction and Dynamic Specialization" (Amazon link here[1]). I have not read the book yet, but he talks about it in a podcast which is available at ITConversations.com (link here[2])

One other point. Sharing presumes more transparency in the production process and results in types of sharing that not only involve contributions of inputs/goods/time, but contributions of better methods of achieving the goal of sharing. Think cooperative networks of faculty sharing their course notes and the result that this makes it easier for new entrants into the community (those teaching new courses and those new to teaching).

A better example is the use of Linux to teach Computer Science students. Before open source software, the no code was available for students to study (or to contribute to). The ability to share and the incumbent transparency it presumes is a motivator for new entrants to join the community vs. closed communities that you cannot join or contribute to - even if you wanted to.

Counter-examples

Key Concepts