>From Michael Perelman's, Class Warfare in the Information Age:
``Despite all the talk of an information economy, most economists have failed to recognize how much the ground has been changing under their feet. In addressing the information revolution, we will see that economic theory suffers from the same sort of confusions that are implicit in the misleading metaphor of the information superhighway, which suggests that information is trucked about like so much soap or canned soup.
The problem is that modern economists have traditionally seen their discipline as the science of allocating scarce resources (see Robbins 1969, p.16) This approach seemed consistent with their well-established practice of restricting their conception of scarce resources to three seemingly well-understood entities: land, labor, and capital.
Economists presumed that markets could somehow measure each of these resources in an unambiguous way in order to ensure that each was put to the most effective possible use. The simplicity of this approach became less meaningful with each passing day as economists' conception of scarce resources became increasingly nebulous...'' (85p)
``I can not emphasize this point enough: The concept of scarcity is absolutely irrelevant to information. The more we restrict other people's access to information, the less we are able to utilize information for our own use. Economics, which economists themselves define as the allocation of scarce resources, has little to offer in an information economy, since information is not scarce, except to the degree that we allow agents to create artificial scarcity through secrecy and property rights. More to the point, as our economy becomes increasingly dependent on information, our traditional system of property rights applied to information becomes a costly fetter on our development'' (87p)
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In several sections after a lack of scarcity, Michael P adds, information is also not rivalrous and has a marginal cost of zero.
I enjoyed the reading up until the later sections were MP goes after Hayek's idea of market price as information. That's just my non-economic mind revolting I suppose, since I consider price a lie, or to contain the maximum amount of dis-information possible.
In any event I had something like a critique, which I hope is helpful, and isn't too mis-informed.
While I was reading, I realized while I agreed with just about everything I read, I was agreeing with a line of argument. So, if I had not agreed in advance, I would have been screaming on every page. If I didn't agree, would this book have convinced me? No, possibly not. Why? What did it need to defeat scepticism? The antidotes, and references were mostly illustrative of points in line with the argument. In others they clarified concepts or points in the overall narrative.
So, I reasoned in order to beat scepticism and criticism into a sullen silence, what is needed is demonstration. The book was essentially an argument rather than a demonstration.
Why? I suspect because what I mean by a demonstration is a series of tables and statistical or other empirical measures that demonstrate a relationship that is critical to a line of argument. It occurred to me that the reason there were no tables and graphs is because there were no measures. The most likely reason was simply that acceptable measures and perhaps even a crude consensus on how to form them didn't exist. And, therefore in order write about the subject, it was necessary to proceed as an argument rather than an empirical demonstration. I realized later that the long sections on Hayek where probably put there to kill off his use of price as information, as a potential model for an information economy.
If this is an accurate impression, then it seems to me, one big order of business for left economists is to get busy and start inventing some of those measures so their arguments can be formed as demonstrations. If that can be done on something like the information economy (or new economy as it were), then the capital/government establishment will be put in a corner and have to defend themselves and will fail to do so. The reason is that mere argument usually can not defeat a well formed demonstration. Only an another well formed demonstration can do that.
This is not directed at convincing the masses or the press. It would be much more useful in academia obviously, but also in law and policy contexts were rational empiricism is supposed to still have some sway (shut up, I can hear the laughing from here).
By the way, impressing academia, moving it out of cyberhype is not a trivial exercise. Last week, UCB fired up for fall semester, and I worked on two law student's power wheelchairs who were headed back for their second year at Boalt. Both were going into intellectual property law! I needed one of those empirical arguments to hit them with, but all I could muster was something like, `hegemonic pig capital triumphs with virtual products of zero material value, spun out of thin air by government fiat.' Or words to that effect. They laughed, but were only convinced that I was completely insane. One of them, the more liberal of the two gave me something along the lines of Matt Cramer's liberatarian spiel last week over freedom, creativity, empowerment, etc. In other words another argument.
So how about some of those empirical measures to beat up the competition?
Chuck Grimes
PS. Here I just opened Code and Other Laws of Cyberspace, to a random section on intellectual property (141p):
``Choices
I've argued that cyberspace will open up at least two important choices in the context of intellectual property: whether to allow intellectual property in effect to become completely propertized (for that is what a perfect code regime for protecting intellectual property would do), and whether to allow this regime to erase the anonymity latent in less efficient architectures of control. These choices were not made by our framers. They are for us to make now.
I have a view, in this context as in the following three, about how we should exercise that choice. But I am a lawyer, trained to be shy about saying, `how things ought to be.' Lawyers are taught to point elsewhere---to the framers, to the United Nations charter, to an act of Congress---when arguing about how things ought to be.''
So you can see how a well constructed demonstration as part of an argument will be evidentually used in legal and policy formats. Of course I say fuck intellectual property law entirely since all it is devoted to is making some jerk like Gates rich, and keeping me broke and stupid.