Wednesday, January 03, 2007

economics of information: resources

I'm gathering resources on this question. Here are some annotated links. Please get in touch if you are studying and want to share ideas on this topic.

Eben Moglen
General Counsel, Free Software Foundation
Founder, Software Freedom Law Center
Great resources available from his site.

Coase's Penguin, or, Linux and The Nature of the Firm (pdf) by Yochai Benkler
For decades our common understanding of the organization of economic production has been that individuals order their productive activities in one of two ways: either as employees in firms, following the directions of managers, or as individuals in markets, following price signals. This dichotomy was first identified in the early work of Ronald Coase and was developed most explicitly in the work of institutional economist Oliver Williamson. In this paper I explain why we are beginning to see the emergence of a new, third mode of production, in the digitally networked environment, a mode I call commons-based peer production.

The Magic Cauldron by Eric Raymond
This essay analyzes the evolving economic substrate of the open-source phenomenon. I first explode some prevalent myths about the funding of program development and the price structure of software. I then present a game-theory analysis of the stability of open-source cooperation. I present nine models for sustainable funding of open-source development; two non-profit, seven for-profit. I then continue to develop a qualitative theory of when it is economically rational for software to be closed. I then examine some novel additional mechanisms the market is now inventing to fund for-profit open-source development, including the reinvention of the patronage system and task markets. I conclude with some tentative predictions of the future.

The Scientific Flask - critique of The Magic Cauldron by Fare Rideau

Open Source as a Signalling Device - An Economic Analysis
We argue that the particular way in which open source projects are managed and especially how contributions are attributed to individual agents, allows the best programmers to create a signal that more mediocre programmers cannot achieve. Through setting themselves apart they can turn this signal into monetary rewards that correspond to their superior capabilities.

Ross Anderson
has published extensively on the economics of information security (not sure how relevant)

In this blog post, Stuck in the 20th Century, Lawrence Lessig (one of the initiators of the Creative Commons licenses) describes himself as a communalist when accused of being a communist: "So Nick Carr charges me with launching the Cultural Revolution, in a post dripping with references to the evils of communism ..."

Lessig goes onto recommends these three (really four) books for those who "really don’t see that there are different economies":

The Wealth of Networks: How Social Production Transforms Markets and Freedom by Yochai Benkler
In Benkler's view, the new "networked information economy" allows individuals and groups to be more productive than profit-seeking ventures. New types of collaboration, such as Wikipedia or SETI@Home, "offer defined improvements in autonomy, democratic discourse, cultural creation, and justice"-as long as government regulation aimed at protecting old-school information monoliths (such as the Digital Millennium Copyright Act) doesn't succeed. Non-market innovation is a good thing in itself and doesn't even have to threaten entrenched interests, Benkler argues; rather, "social production" can use resources that the industrial information economy leaves behind

The Success of Open Source
by Steven Weber
Ever since the invention of agriculture, human beings have had only three social-engineering tools for organizing any large-scale division of labor: markets (and the carrots of material benefits they offer), hierarchies (and the sticks of punishment they impose), and charisma (and the promises of rapture they offer). Now there is the possibility of a fourth mode of effective social organization--one that we perhaps see in embryo in the creation and maintenance of open-source software.

Democratising Innovation by Eric von Hippel
Von Hippel argues that manufacturers should redesign their innovation processes and that they should systematically seek out innovations developed by users. He points to businesses -- the custom semiconductor industry is one example -- that have learned to assist user-innovators by providing them with toolkits for developing new products. User innovation has a positive impact on social welfare, and von Hippel proposes that government policies, including R&D subsidies and tax credits, should be realigned to eliminate biases against it. The goal of a democratized user-centered innovation system, says von Hippel, is well worth striving for

The Long Tail: Why the Future of Business is Selling Less of More by Chris Anderson
Smash hits have existed largely because of scarcity: with a finite number of bookstore shelves and theaters and Wal-Mart CD racks, "it's only sensible to fill them with the titles that will sell best." Today, Web sites and online retailers offer seemingly infinite inventory, and the result is the "shattering of the mainstream into a zillion different cultural shards." These "countless niches" are market opportunities for those who cast a wide net and de-emphasize the search for blockbusters


Anonymous said...

Dunno for sure Bill, it just pinged in this morning, and I am only on my first read but I think Blogging the nihilistic impulse by Geert Lovink in the latest Eurozine has some arguments that are relevant here. I am much enjoying it - Geert presents some deliciously different and complex theory about blogging.

Bill Kerr said...

hi arti,

I struggled with that article. It's a sort of ahistorical, post-modern, academic writing I don't like much.

My reasons for blogging have changed since I started blogging, the act of blogging altered the meaning.

My initial thought was to write a course about web apps using python to share with others and perhaps get some feedback! Pretty funny.

Now I think it's more about exploring meanings, I never thought that meaning was so complicated but blogging has gradually changed me. Now it's about Wittgenstein and Quine:
"We are like sailors who on the open sea must reconstruct their ship but are never able to start afresh from the bottom. Where a beam is taken away a new one must at once be put there, and for this the rest of the ship is used as support. In this way, by using the old beams and driftwood the ship can be shaped entirely anew, but only by gradual reconstruction."

I much prefer this positive account of blogging or some Jay Rosen, who has his moments, what's radical about blogs , what's conservative about blogs

No worries arti, I see you as the master of metaphor :-)

Anonymous said...

Ohh I know Bill - it most definitely buttons "post-modern" - and I don't necessarily agree that "Blogs lead to decay" but I loved some of the provocation - the different ways of looking at things. Stuff I want to explore the meanings of.

For example

"As much as "democratisation" means "engaged citizens" it also implies normalisation (as in setting of norms) and banalisation"

"In that sense blogs fit into the wider trend in which all our movements and activities are being monitored and stored. In the case of blogs this is carried out not by some invisible and abstract authority but by the subjects themselves, who record their everyday lives."

"The question is therefore: how much truth can a medium bear? Knowledge is sorrow, and the "knowledge society" propagators have not yet taken this into account"

"what we instead see happening on the software side are daily improvements of ever more sophisticated (quantitative) measuring and manipulation tools (in terms of inbound linking, traffic climbing higher on the Google ladder, etc). Isn't the document that stands out the one that is not embedded in existing contexts? Doesn't the truthness lie in the unlinkable?"

and more ... many conversations to be had with myself ...

Bill Kerr said...

"The question is therefore: how much truth can a medium bear? Knowledge is sorrow, and the "knowledge society" propagators have not yet taken this into account"
I don't think knowledge is sorrow and this media can bear as much truth as you like.

Yes, there are issues with blogs (banalization, chasing popularity) but this article is not historically contextual. My sense is that it's "clever" criticism from the sidelines, not organic or generated from real participation or struggle.

I don't see how anyone can generalise in this way about a new medium? Aren't there radicals and conservatives represented in new media, that this is inevitable, not surprising? It's better that everyone has their own printing press and chaos reigns, than the alternative of Big Media alone. I can't see that this article recognises that in any way.

I think there are different critical commentators saying those sorts of things but from a perspective of technological and social optimism. Alan Kay for example critically comments on the future that he has been actively involved in inventing:
"Computing spread out much, much faster than educating unsophisticated people can happen. In the last 25 years or so, we actually got something like a pop culture, similar to what happened when television came on the scene and some of its inventors thought it would be a way of getting Shakespeare to the masses. But they forgot that you have to be more sophisticated and have more perspective to understand Shakespeare. What television was able to do was to capture people as they were. So I think the lack of a real computer science today, and the lack of real software engineering today, is partly due to this pop culture."

Anonymous said...

I am already agreeing and disagreeing with myself within the same sentence Bill, always a good sign.

For example, I agree with your
I don't think knowledge is sorrow and this media can bear as much truth as you like.
but then at the same time I have to admit to denying myself knowledge because if I look at it too closely it makes me sad or sick– the knowledge that I self censor, the things I do not watch, do not read or simply walk away from. In that context Lovink’s knowledge is sorrow is true for me.

I also agree that Lovink’s view is bleak and desperately pessimistic – he is arguing that in blogging everyone has their own printing press producing “ever shifting collections of buzz words clouds, consisting of trillions of clicks and micro opinions” and that “chaos reigns” is nothing more than “the flat noise of opinion” – and even worse this is caused by and is causing increasing disbelief in any message - it reminds me a little of that “beware the hive mind” thinking Lanier came up with in his Edge piece last year.

Fromm’s “The right to express our thoughts means something only if we are able to have thoughts of our own” interests me – a sense of this is captured in the Alan Kay comments on Shakespeare and pop culture – I am not sure how I think about this claim. Is it ever possible to have “thoughts of our own” Bill? and if it were who would judge whether they were really of our own or not? Be a little like judging creative output in schools.

And that makes me think that although “It's better that everyone has their own printing press and chaos reigns, than the alternative of Big Media alone.” It is better again to find a position that allows a continuum between chaos and Big Media

I like/d the article because of the way it challenges (albeit in a “clever” (and like you I use the word pejoratively)rather than an ”authentic” way) the way I have thought about blogging – but i will acknowledge that this position is more likely a reflection of my limited reading around issues of technology, sociology and culture, than a reflection of any merit in the commentary.

Must read more … must read more

Bill Kerr said...

I like/d the article because of the way it challenges ... the way I have thought about blogging

I think that's important. But the sort of way you run your blog, as a means to have an ongoing reflective conversation about education, across across the world, starting from the viewpoint of one person, is something that was not previously possible and is obviously valuable.

My blog was initially more intended as an easily searchable online notebook than anything else. I was initially surprised at the number of other people who read it and it has taken me a while to take the conversational aspect of it seriously. I've learnt a lot from your comment threads in that regard.

One possible downside to being noticed is that I might end up wanting to please those readers rather than representing my own thoughts (self censorship). The upside is that knowing there are readers persuades me to express my thoughts more clearly, partly for the readers sake, but that is a huge benefit for me as well. eg. writing this reply has made me think about the benefits of blogging in a concrete way, persuaded me to outline some of them here, in a way that would have been different or non existent in an offline diary. There is positive pressure to make your thoughts clearer for a real audience, especially a critical audience who can respond.

Before blogging I spent year on the Usenet logo programming language newsgroup forum - and make friends there as well as learning a lot about logo. Blogging is different, more personal. So, all in all, I think there are clear benefits arising from blogging as well as the banalisation, normalisation, hive mind, self censorship and chasing popularity problems.

The reason I didn't like the article is that it made lots of generalisations (some of which as you say are worth thinking about) but without actually citing the real experience of any single blog. I reject that sort of approach to writing categorically, as a form of academic snobbery

Is it ever possible to have “thoughts of our own” ...

In a Piagetian sense I think we all rediscover the thoughts of others on our own. For something really new and useful we are dependent on those who do the hard work of climbing on the shoulders of giants first, but we can all contribute to building an environment that facilitates that. Beautiful flowers grow in fertile soil (Chinese writer, Lu Hsun), we can all help improve the soil. Blogs are an important part of that process too IMO.