Artificial Scarcity: Difference between revisions
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An example of artificial scarcity is often used when describing proprietary, or closed-source, computer software. Any software application can be easily duplicated billions of times over for a relatively cheap production price (an initial investment in a computer, an internet connection, and any power consumption costs). On the margin, the price of copying software is next to nothing, costing only a small amount of power and a fraction of a second. Things like serial numbers, license agreements, and intellectual property rights ensure that production is artificially lowered in order for business to gain a monetary benefit, thus giving businesses an incentive to produce software. Technocrats argue that if the the price system were removed, there would be no personal incentive to artificially create scarcity in products, and thus something similar to the open source model of distributions would exist." | An example of artificial scarcity is often used when describing proprietary, or closed-source, computer software. Any software application can be easily duplicated billions of times over for a relatively cheap production price (an initial investment in a computer, an internet connection, and any power consumption costs). On the margin, the price of copying software is next to nothing, costing only a small amount of power and a fraction of a second. Things like serial numbers, license agreements, and intellectual property rights ensure that production is artificially lowered in order for business to gain a monetary benefit, thus giving businesses an incentive to produce software. Technocrats argue that if the the price system were removed, there would be no personal incentive to artificially create scarcity in products, and thus something similar to the open source model of distributions would exist." | ||
(http://en.wikipedia.org/wiki/Artificial_scarcity) | (http://en.wikipedia.org/wiki/Artificial_scarcity) | ||
=Discussion= | |||
ZikZak: | |||
"It's not a mistake or an accident that abundance is destroyed. Profit-oriented institutions depend on scarcity, so when it doesn't come about naturally, they manufacture it. | |||
Most excess food, clothing and other valuable goods don't just "spoil". They're actively destroyed by producers or retailers, because putting them to useful purpose by making them available to people would undercut the scarcity on which the producers and retailers depend to turn a profit. | |||
It's a fundamental contradiction of late-stage capitalism. The market has succeeded in creating huge overabundance such that everyone could have as much as they need, but this abundance undermines the success of key players in the market. So they have to do additional work just to re-create an artificial scarcity in order to continue profiting from an outdated business model." | |||
(http://www.boingboing.net/2010/02/08/marina-gorbis-crowds.html) | |||
=More Information= | =More Information= | ||
Revision as of 02:54, 9 February 2010
Description
From the Wikipedia at http://en.wikipedia.org/wiki/Artificial_scarcity
"Artificial scarcity describes the scarcity of items even though the technology and production capacity exists to create an abundance. The term is aptly applied to non-rival resources, i.e. those that do not diminish due to one person's use, although there are other resources which could be categorized as artificially scarce. The most common causes are monopoly pricing structures, such as those enabled by intellectual property rights or by high fixed costs in a particular marketplace. The inefficiency associated with artificial scarcity is formally known as a deadweight loss.
An example of artificial scarcity is often used when describing proprietary, or closed-source, computer software. Any software application can be easily duplicated billions of times over for a relatively cheap production price (an initial investment in a computer, an internet connection, and any power consumption costs). On the margin, the price of copying software is next to nothing, costing only a small amount of power and a fraction of a second. Things like serial numbers, license agreements, and intellectual property rights ensure that production is artificially lowered in order for business to gain a monetary benefit, thus giving businesses an incentive to produce software. Technocrats argue that if the the price system were removed, there would be no personal incentive to artificially create scarcity in products, and thus something similar to the open source model of distributions would exist." (http://en.wikipedia.org/wiki/Artificial_scarcity)
Discussion
ZikZak:
"It's not a mistake or an accident that abundance is destroyed. Profit-oriented institutions depend on scarcity, so when it doesn't come about naturally, they manufacture it.
Most excess food, clothing and other valuable goods don't just "spoil". They're actively destroyed by producers or retailers, because putting them to useful purpose by making them available to people would undercut the scarcity on which the producers and retailers depend to turn a profit.
It's a fundamental contradiction of late-stage capitalism. The market has succeeded in creating huge overabundance such that everyone could have as much as they need, but this abundance undermines the success of key players in the market. So they have to do additional work just to re-create an artificial scarcity in order to continue profiting from an outdated business model." (http://www.boingboing.net/2010/02/08/marina-gorbis-crowds.html)
More Information
See also the entries on Abundance vs. Scarcity