by Last week we talked about the sharing economy as a transition stage to “after capitalism.”
Intermediaries are an interesting consideration in the Horizon 2 (H2) transition. The sentiment today is that intermediaries are bad and thus should be disintermediated. Get rid of the middleman! Thus P2P (peer-to-peer) platform approaches are in favor.
But let’s recognize that they are useful and not-so-useful intermediaries. A simple example is travel agents. In many cases, they got a percentage for not adding much value. But how many of us long for the days when we had one who saved us countless hours comparing airlines and searching for hotels – that’s a precious intermediary. When we disintermediate, the illusion is we are taking out costs, but really we are just shifting them. Instead of one travel agent, a company of 40 people has in effect 40 part-time travel agents. So we may see some “re-intermediation” along with disintermediation.
I put P2P Platforms in transition in because I think it will have one foot in the old and one in the new. UBER and AirBnB, the poster children of P2P platforms, are enabled by intermediaries who make a nice living from it and lean toward the old Horizon 1 neoliberal world. As we discussed last week, the gift platforms (freecycle, neighborgoods) lean toward Horizon 3 transformation.
In my scanning, P2P platforms are sometimes praised for bringing back the old barter economy. I sorta get it, but I there is a tendency to romanticize barter. I suspect it is simple an emotional reaction against the evils of money. But trying to figure out how many haircuts is worth how many miles of an Uber ride or shoveled driveways seems counter-productive….unless, we jump to a transformation scenario in which it is not necessary to assign value. Some local currency experiments have done okay with this, but the idea isn’t scaling. In the H2 transition, pricing/value is still essential. Indeed, one of the “scary” paths that might emerge from this transition is what we might call hyper-pricing, in which economic value is ascribed to practically everything. You one-hundredth of a cent for visiting a web page, a couple cents for clicking on an ad, etc. Not conducive to barter.
So, as we look at P2P platforms, let’s be sure to situate them on our three horizons, and not fall into the trap of lavishing praise on new things just because they are new, or more simply, watch out for the poseurs! – Andy Hines
I would agree with you, Andy, that so-called shared economy hasn’t traveled far from Horizon 1 capitalism. From one POV, it is simply a new way to exploit workers, which is a characteristic of capitalism, if it can get away with it. If there is a real transition in prospect, which I’m not seeing yet, it is likely to be extremely messy and possibly even revolutionary.
thanks, totally agree, and I’m trying to find the “real transition” or transformation, or at least some viable options!
It is or soon will be possible to make workable electronic barter economies via smartcontracts. Imagine a barter-exchange where automated contracts seek out the best deal. Simple barters based on records of the “going rate” for certain types of exchanges would help make simple 1-1 swap barters easy. A much more interesting scenario happens when you allow barter chains, ala ‘I’ll trade you A, if you can get me B. Ok, I can get you B, if someone will exchange my C for a B. Sure, I’ll take your C and give you B, but you also need to give me D…..”. The parameters of each smartcontract would allow a range of flexibility in negotiation with other smartcontracts allowing them to potentially link up in a way where the initiator might not even know how their barter contract was ultimately fulfilled. The barter exchange could then take that registered barter chain and use the trade chain to update the current going swap rate for barters.
There is of course a chicken and egg problem with automated barter exchanges.. It is difficult to build up barter chains to smooth out the transactions until their are sufficient contracts in the barter exchange, and there is no reason to join the exchange if there are not enough participants to freely barter. It is likely that if such an exchange ever gains popularity, it will quickly dominate that business space, ala how Facebook dominates social media or Google dominates web searches.
The smart contracts do have great potential! Perhaps they could indeed by programmed to determine the “going rate,” i.e., the price mechanism. The really freak transformative part is when we just do stuff, and don’t have to worry about the value of it.