This article gives insight into the fascinating concept of agalmics and how economics can be a positive-sum game, especially with the new technologies that are coming.
John
http://www.openverse.com/~dtinker/agalmics.html
The Marginalization of Scarcity
by Robert Levin
Thanks to all who have commented thus far. The comments from working
economists and sociologists were of particular interest, and I can see
that they are going to produce some changes in the essay. In
particular, gentle reader, realize as you read that I do not consider
agalmias to be gift cultures per se; traditional gift cultures are
largely pre-industrial, and based as much on scarcity as any modern
technological state.
Also, when you read my games-theory comments, don't infer that I
believe economies are zero-sum games. While one or both "legs" of an
economic transaction can most conveniently be expressed as a zero-sum
game, that does not extend to economies as a whole, nor even
necessarily to a single complete economic transaction. I'll plan to
discuss these points in more detail in follow-ons to this essay.
Finally, frequent comments have led me to conclude that an important
element is missing from the definition of agalmics. Agalmic goods are
non-scarce goods, but they are often produced using scarce goods as
raw materials. An important example is the initial programming work
which goes into a free software application. At the current state of
the human lifespan, programmer time must be regarded as a scarce good.
I've added the words "production and" to the definition, and I hope
you'll find this to be a clear and necessary improvement. We are now
at version 3.0 of the essay.
Introduction
The recent growth of interest in Linux and "open source" or "free"
software raises questions about the nature of the "gift culture" of
the Internet. Why do people give away information? What do they hope
to gain? How can the Internet continue to work, in a world in which
politics based on shared ownership has serious, demonstrated problems?
The cooperative spirit of the Internet is not a historical fluke. If
human beings allowed their aggressive, suspicious sides to dominate,
we'd live in a world in which people took things by force instead of
buying them. And how would anyone trust the printed word? How could
education occur in the absence of cooperation? All over the world,
students listen and educators teach. In a largely unrestricted market
of record size, individuals freely trade goods and services for other
goods and services of their choice. Ownership of private property
remains largely undisputed by men with guns. We live in the
cooperative state known as civilization.
Not every human activity is cooperative. Wars still occur. And the
existence of laws implies that people do disagree about when
cooperation is a good thing. But it's clear that voluntary interaction
serves important human needs. The most successful economic systems on
the planet are based on voluntary interaction. Variants of the "free
enterprise" model have produced wealth and plenty on a vast scale.
Political systems based on involuntary interaction, such of those of
the Soviet Union and various Third World nations, have not been nearly
so successful at meeting the needs and desires of their citizens as
have systems which emphasize freedom.
But will technology change the way human beings interact over the
coming decades? What trends do we need to understand in order to see
where things are going? One clear trend in a technological society is
the marginalization of scarcity. As time goes on, the technology of
agriculture and manufacture teaches us how to produce goods with more
efficiency, at less cost. The trend in technology is an exponential
improvement of knowledge and capabilities. Make anything cheap enough,
and it will no longer be scarce enough to be considered an economic
good.
Contrary trends operate in the marketplace. Intellectual property, a
system of law in which access to inventions and creative output is
limited in order to reward their creators, has a powerful conservative
influence on the market, slowing the adoption of new ideas and
inventions. Patent law rewards inventors for coming up with useful
technology; but the reward often comes in the form of purchase of the
right to control who may use that technology. Large corporations, with
large legal and accounting staffs and access to capital, have an
extraordinary advantage in accumulating exclusive rights to new
technologies. The nature of such organizations is to hold onto these
assets tightly and release them slowly, so that the most efficient
return on investment can be achieved.
But technological change continues to occur, in part because competing
organizations often need the competitive advantage which new
technology can provide. So we can be certain that, over time, more and
more basic goods will become less and less scarce. With these changes,
it becomes increasingly important to understand how human beings
allocate non-scarce goods. Indeed, a sort of "economics" of
non-scarcity becomes an important study. But economics is the study of
the allocation of scarce goods. We need a new paradigm, and a new
field of study. What we need is agalmics.
Definitions
agalmics (uh-GAL-miks), n. [Gr. "agalma", "a pleasing gift"] The study
and practice of the production and allocation of non-scarce goods.
agalmic actor, n. An individual or organization engaged in agalmic activity.
agalmic software, n. Computer software written and distributed as an
agalmic activity.
agalmia, n. The sum of the agalmic activity in a particular region or
sphere. Analogous to an "economy" in economic theory.
Characteristics
To understand human behavior, we must find clear examples to study.
Agalmic behavior involves the exchange of non-scarce goods, goods
which can be found in the modern free software community. As we
examine agalmic behavior, we'll frequently use examples involving free
software. We can observe the following characteristics of agalmic
activity:
It is transfinite. Economic trade is finite; when I give you a dollar
I have one less than I did. Agalmic activity involves goods which are
not scarce, so I can give you one without appreciably diminishing my
supply.
It is cooperative. Economic activity often involves competition.
Buyers must allocate their limited funds to the supplier who best
meets their needs. Since it doesn't involve scarce resources, agalmic
activity rarely involves competition. Efficient agalmic actors know
how to encourage cooperation and benefit from the results.
It is self-interested. Agalmic activity advances personal goals, which
may be charitable or profit-oriented, individual or organizational. An
agalmia typically contains both individuals and organizations, with a
broad mix of charitable and profit-oriented goals. Agalmic profit is
measured in such things as knowledge, satisfaction, recognition and
often in indirect economic benefit.
It is self-stimulating. Examples can be seen in free software
communities, in which new programmers, documenters and debuggers come
from the ranks of free software users.
It is self-directing. Free software users provide feedback to
developers in the form of bug reports, patches and requests for new
features. Software projects can be forked by users when an existing
developer group is not responsive to their needs. Maintainers are then
free to adopt the new work or go their own way.
It is decentralized and non-authoritarian. In a free software
community, developer groups maintain their positions only as long as
they are responsive to their user bases. No one is forced to
participate in a project, and the projects people participate in are
the ones in which they are interested. Involuntary activity places
limits on exchange and creates scarcities. As such, it is non-agalmic.
A particular agalmic group may be organized in a top-down fashion, and
non-agalmic groups may act agalmicly. But alternatives are available
and participation is voluntary. Authoritarian systems remove personal
incentives for agalmic behavior.
It is positive-sum. In games theory, a 'zero-sum game' is one in which
one player's gain is another player's loss. Conventional economics
often describes zero-sum games. When two suppliers compete for the
dollars of a single customer, or when two government agencies compete
with each other for fixed budget dollars, a zero sum game is played. A
'positive-sum game' is one in which players can gain by behavior which
enhances the gains of others. Efficient agalmics is a positive-sum
game. For example, when a free software programmer gives his source
code away, he gains a large population of users to report bugs; the
users gain the use of his programs. By awarding the other players
points, the player gains points.
It is not new. Gift cultures have existed during much of human
history, and other, non-gift cultures have clear agalmic influences.
Religious communities have engaged in agalmic behavior, as have
governments, businesses and individuals. Charities, standards
organizations and trade associations often act agalmicly. It may be
argued convincingly that civilization itself is an agalmic activity.
Conclusions
The behavior of agalmias gives us useful information about the ways
that societies can change and grow. Open source and free software
communities provide us with excellent modern day agalmias for study,
as does the Internet itself. But long term trends in technology
suggest that material scarcity will likely become less common, and
agalmic behavior more common. In studying the behavior of agalmias we
can see intimations of our technological future.
Robert Levin
Woodland Hills, California, US
4 April 1999
Email: levin@openprojects.net
Online: lilo at Open Projects Net IRC
