Rising Income Inequality & Shifting Identities – The Specialist & The Omnivore *Please note that this is not a political commentary. I will leave the political punditry to the people who think politicians are actually capable of accomplishing something. I have recently come across a number of debates about income inequality so I am going to try to contsruct some context around this issue. A recent article from The Economist notes that income distributions have become more unequal in the large majority of developed countries: American society is more unequal than those in most other OECD countries, and growth in inequality there has been relatively large. But with very few exceptions, the rich have done better over the past 30 years, even in highly egalitarian places like Scandinavia. Reports such as this provide easy fodder with which to demonize your favorite economic villian, but before we jump to conclusions it will prove worthwhile to pause and ask a few questions: Why Do We Care About Income Inequality? Income is a proxy for well being. Benefits Costs The Result
The Economics of Abundant Production « webisteme Before the web, the business model for producing and distributing informational goods, such as music, books, films and journalism, was much more straightforward. Such models relied on the coincidence that a physical medium was necessary in order to share the information good in question. Written journalism could only be transmitted in print, for example. Listening to music required a CD, tape or vinyl player. With the rise of the internet, these dynamics have begun to change. While this is a great opportunity for an explosion in free content, it also raises questions about how people who contribute to the information goods commons, for free, can earn a living. The paradox of the information producer The paradox of a person who produces information goods and shares them for free, is that their activity is enabled by participation in an economy based on scarcity and market transactions. Solving the paradox The information producer is in a curious position. Social capital
The Future of Money is Abundance « webisteme We now enjoy an abundance of information goods unparalleled in history, thanks to the negligible marginal cost of distribution allowed by the internet. This has in turn disrupted old markets for such goods, and spurred exciting business model innovations. Forward-thinking companies are now working out ways to share value for free, and to leverage the resulting gains in attention and reputation to make money in the marketplace. While businesses react to a logic of abundant production, and work out how to adapt their models, there is another area which has received less attention: abundance-based currencies. By ‘abundance’ in this context, we don’t mean ‘free’ in the sense of ‘free beer,’ but rather ‘free speech.’ The ideal of abundance-based money is that it can be created by anyone according to need, and an agreed system of rules which regulates its value. Abundance-based money Abundance-based money has existed for a long time. Demonetisation Abundance-based currencies Conclusion Elsewhere
A Broader Definition of Currency « webisteme Money and currency are considered synonymous, but a broader definition of currency gives an interesting perspective on the current financial crisis, as well as the next wave of currency innovation. The Difference between Money and Currency In a recent panel discussion called “Monetizing Intangible Capital” at the Future of Money conference (Feb 2011), Art Brock drew an interesting distinction between money and currency which I had not heard before. I use the word currency distinct from money. According to this view of currency, money is just one type of currency which is fungible, enabling it to serve as a medium of exchange and a store of value. Brock suggests that one of the functions of a currency, in this broader sense, is to “change the way value flows.” Brock’s distinction between money and currency is not entirely new. The Greek for currency was nomisma, derived from the word Nomos (custom). Why do we need currencies? When currencies go wrong Centralisation Opacity Fetishism Elsewhere
Debt: The first five thousand years - David Graeber Throughout its 5000 year history, debt has always involved institutions – whether Mesopotamian sacred kingship, Mosaic jubilees, Sharia or Canon Law – that place controls on debt's potentially catastrophic social consequences. It is only in the current era, writes anthropologist David Graeber, that we have begun to see the creation of the first effective planetary administrative system largely in order to protect the interests of creditors. What follows is a fragment of a much larger project of research on debt and debt money in human history. The first and overwhelming conclusion of this project is that in studying economic history, we tend to systematically ignore the role of violence, the absolutely central role of war and slavery in creating and shaping the basic institutions of what we now call "the economy". What's more, origins matter. Let me start with the institution of slavery, whose role, I think, is key. The reason I stress this is because this logic is still with us. I.