Profit and Gift in the Digital Economy
* Book: Profit and Gift in the Digital Economy. By Dave Elder-Vass, Loughborough University, 2016
Description
"Our economy is neither overwhelmingly capitalist, as Marxist political economists argue, nor overwhelmingly a market economy, as mainstream economists assume. Both approaches ignore vast swathes of the economy, including the gift, collaborative and hybrid forms that coexist with more conventional capitalism in the new digital economy. Drawing on economic sociology, anthropology of the gift and heterodox economics, this book proposes a groundbreaking framework for analysing diverse economic systems: a political economy of practices. The framework is used to analyse Apple, Wikipedia, Google, YouTube and Facebook, showing how different complexes of appropriative practices bring about radically different economic outcomes. Innovative and topical, Profit and Gift in the Digital Economy focusses on an area of rapid social change while developing a theoretically and politically radical framework that will be of continuing long-term relevance. It will appeal to students, activists and academics in the social sciences."
Excerpts
The Diversity of the Real Economy
Dave Elder-Vass:
"Although Google makes substantial profits by serving up advertisements alongside these search results, the idea that one can run a successful business by giving away a free service to perhaps a quarter of the human race flies in the face of conventional economics. Yet it also confounds Marxist ideas that economic value is essentially a product of labour: both the delivery of search results and the sale of advertising space alongside them are thoroughly automated processes, in which almost all of the processing required is done by computers not people. Nor does it support conventional ideas of the gift economy, which is usually seen as an alternative to the commercial economy, making personal connections on the basis of reciprocal obligations.
The best-established ways of understanding our economy are the neoclassical tradition that dominates mainstream academic economics and the Marxist tradition that dominates critical politics. For both, despite individual dissenters and substantial differences in the details, the contemporary economy is a monolith: a capitalist monolith, characterised more-or-less universally by the production of commodities by businesses for sale at a profit. For the typical neoclassical economist this is to be celebrated as the most efficient way to run an economy – and extended into whatever benighted spaces have resisted it. For the typical Marxist it is to be criticised as alienating and exploitative, and overthrown by taking control of the state and imposing an entirely different, but equally monolithic, form of economy.[2]
The real economy, however, is far more diverse. It is neither overwhelmingly capitalist as most Marxists assume nor overwhelmingly a market economy as most mainstream economists assume. Both traditions tend to ignore vast swathes of the economy that do not fit with their stylised models, but because their models have thoroughly shaped our thinking they have largely succeeded in obscuring these diverse economic forms from view. This is not a new problem. Feminists, for example, drew attention to the household economy many years ago (e.g. Friedan, 1963; Hochschild, 1989; Molyneux, 1979). But the problem is coming more sharply into focus with the rise of the digital economy, with its proliferation of innovative economic forms.
Our failure to recognise the diversity of our existing economic systems is doubly consequential. On the one hand, it produces a warped and damaging understanding of how the existing economy works; and on the other, it radically limits our ability to think creatively about economic futures. Capitalism as a universal system, if such a thing could even exist, would be utterly inadequate to the challenge of meeting human needs, but this does not mean that the solution is some other universal system. If we are to think productively about alternatives we must stop imagining our economic futures in all or nothing terms: capitalism universal vs. capitalism destroyed.
The central original contribution of this book is to propose a new framework that enables us both to see and to analyse a vast range of diverse economic forms, and to illustrate that framework by applying it to cases in the contemporary digital economy. In this framework, which I call a political economy of practices, each economic form is understood as a complex of appropriative practices: social practices that influence the allocation of benefits from the process of production. Different combinations of appropriative practices give us different economic forms with very different effects on who receives what benefits and harms from the economy. The political economy of practices examines how the practices concerned interact to produce those effects, but it also takes an evaluative stance, offering grounds to judge which forms are more desirable in any given context.
The appropriative practices at work in a fairly conventional capitalist firm like Apple are very different from the set at work in a gift economy structure like Wikipedia, but some of the most interesting processes in the digital economy are hybrid forms that combine elements of both capitalist and gift economy forms. The digital economy is diverse not only in the sense that it includes both capitalist and non-capitalist forms, but also in the sense that there are multiple varieties of the capitalist form, many of which do not conform to the traditional models, and indeed multiple varieties of gift economy forms, as well as forms that are neither, or indeed a mixture of both. From this perspective, it becomes possible to see our economy as a complex ecosystem of competing and interacting economic forms, each with their own strengths and weaknesses, and to develop a progressive politics that seeks to reshape that ecosystem rather than pursuing the imaginary perfection of one single universal economic form." (http://materiallysocial.blogspot.co.uk/2016/06/profit-and-gift-in-digital-economy.html)
Source: This post reproduces text from pages 3-5 of Elder-Vass, D. (2016) Profit and Gift in the Digital Economy, Cambridge: Cambridge UP, due to be published in July 2016.
Complex of Appropriative Practices
Like Kojin Karatani, and the P2P Foundation, the author uses a multi-modal approach to analyze society and the economy:
"Wage labour alone is not enough to give us canonical capitalism, since people may work for wages in a variety of non-capitalist contexts such as government deparments. Nor is commodity production enough to give us canonical capitalism, since commodities may also be produced by individuals working alone, in family businesses that do not pay wages, or in co-operatives (Gibson-Graham, 2006b, p. 263; Sayer, 1995, p. 181). We may even have both wage labour and commodity production without canonical capitalism, notably in state-run enterprises. Canonical capitalism is thus defined by a certain complex of appropriative practices rather than by any specific appropriative practice.
This concept of a complex of appropriative practices, I argue, has several advantages over competing understandings of economic form. Both the neoclassical orientation to markets as the only significant economic form, and the monolithic conception of a mode of production are inadequate for theorising the range of economic forms in diverse economies. This section will examine some of the ways in which the concept of complexes of appropriative practices allows us to theorise social relations more flexibly.
The first is that there is no difficulty in theorising the coexistence of multiple economic forms. There is no longer a conflict, for example, between the belief that capitalism is an important element of the contemporary economy and the recognition that it governs only a minority of productive processes, and thus there is no longer a need to obscure the significance of the gift economy or indeed of other non-capitalist economic forms that coexist relatively stably alongside capitalism. Given this, we can reject the attempt to reduce all contemporary class relations to capitalist appropriation of the product of wage labour that is characteristic of the most vulgar Marxism, and start to theorise the social relations and practices of appropriation that characterise these other complexes. We need not, for example, ignore the appropriation of caring services by children in households because Marxism implies that this would make children exploiters of their parents, but rather examine the complex of processes in which this occurs as an economic form in its own right. We can escape from the hidebound pigeonholing of all social relations into what Folbre and Hartmann have called ‘a formulaic set of class processes’ (1994, p. 59) – those few patterns that Marxists believe have dominated epochs.
As well as examining the coexistence of multiple complexes of appropriative practices within the economy we now have the tools to examine such coexistence within specific sites or social entities. The fact that commercial firms are the site of capitalist practices is no longer a theoretical obstacle to recognising that they may also be the site of other forms of appropriative practice. Nor is the argument that households are the site of gift-forms of appropriative practice compromised by recognising that they may also be the site of wage labour, whether it is capitalist (e.g. when an agency supplies cleaning staff) or not (e.g. when a self-employed cleaner contracts to provide a service). The household, in this perspective, becomes the site of moments of appropriation that operate within the frames of a variety of different complexes of appropriative practices. It is, we may say, a mixed economy of practices in its own right. Struggles within the household over the division and control of domestic labour may then also be theorised as struggles over the mix, struggles over which complex of appropriative practices is to prevail in which circumstances.
Relaxing the requirement that an economic form must correspond to the dominant form of an epoch also makes it easier to theorise varieties of a form.
...
It may also be useful to think of some complexes of appropriative practices as hybrid forms ... To get hybridity, we need other types of economic form as well as the capitalist type. Although I have questioned whether there are other coherently identifiable modes of production than capitalism, there can still be other types of complex of appropriative practices. One candidate is suggested by the idea of the gift economy: there is a wide variety of complexes of appropriative practice in which voluntary transfers of goods or services are made without any expectation or obligation to make a return transfer. Some complexes are hybrids of both capitalism and the gift economy because they include both the practice of capital accumulation and the practice of making transfers of goods or services as gifts. Such hybrids are decisively capitalist and yet simultaneously the sites of more progressive practices."
(http://materiallysocial.blogspot.co.uk/2016/07/profit-and-gift-in-digital-economy.html)