Open Data Institute – try reading Coase’s Penguin

One of the roles any government professing liberal democratic values takes upon itself is to implement measures it considers will lead to a thriving market economy. While there are areas of modern life that some/many will consider cannot be met by relying on the market there does not appear to be a significant movement calling for a return to a planned economy.

Except, it would seem to the casual observer, when we are discussing the knowledge or information economy in which it is necessary to consider “thought-through market mechanics”.

Yesterday the government sponsored Open Data Institute (ODI) along with the EPSRC funded project SOCIAM – Social Machines, a project that despite researching:

phenomena such as Wikipedia and Galaxy Zoo. These collaborations are empowering, as communities identify and solve their own problems, harnessing their commitment, local knowledge and embedded skills, without having to rely on remote experts or governments.

held a seminar: Open Data Comes to Market: The Mysterious Case of the Disappearing Crime Apps.

Regarding that seminar we can read:

[T]here are important issues relating to the properties of data markets. If we do not acknowledge that developers will only build sites for a return, and that the consequences of information feeds being resold to the public at market-set rates could be controversial, we will risk getting a skewed view of how open data can thrive and be useful. In the absence of thought-through market mechanics, services may fade away without becoming sustainable. Illustrative and inspiring exploitations of open data without a market imperative (as hacks or pilots), will not address the key issue of sustainability. State intervention may be inevitable if we do not understand how markets can provide useful information services reliably – but to what extent is such intervention desirable?

It would seem that this seminar was built upon the assumption that the market is rooted in the dichotomy first identified by Coase in the early 1930s that productive activities exist in one of two ways:

  • employees in firms, following the directions of managers, or
  • individuals in markets, following price signals

In 2002 Yochai Benkler published Coase’s Penguin which explored the limitations of that perspective with specific reference to the knowledge economy; describing Free and Open Source Software (F/OSS) as:

a vibrant, innovative and productive collaboration, whose participants are not organized in firms and do not choose their projects in response to price signals

which is part of a different mode of production in the digitally networked environment with a central characteristic that:

groups of individuals successfully collaborate on large-scale projects following a diverse cluster of motivational drives and social signals, rather than either market prices or managerial commands.

and that such a mode of production

has systematic advantages over markets and managerial hierarchies when the object of production is information or culture, and where the capital investment necessary for production-computers and communications capabilities-is widely distributed instead of concentrated

While F/OSS is the most visible example in a technology environment, it is easy to look elsewhere and find similar evidence.

The Big Society overlapping F/OSS as we discussed explores activity in the absence of price signals.

Moreover in the same year as Yale published Benkler’s work, the BBC reported on results from the first Time-Use survey in which it was calculated that if housework were a paid-for activity it would account for 75% of the economy.

The UK Time Use Survey was conducted on behalf of a funding consortium which included:

  • Economic and Social Research Council
  • Department of Culture, Media and Sport
  • Department for Education and Skills
  • Department of Health
  • Department of Transport, Local Government and the Regions
  • Office for National Statistics

Today the ODI is conducting the Open Research Data Handbook Sprint. It might be that the project should include a chapter on exploiting cross-disciplinary datasets.

— Gerry Gavigan, Chair, 15 February 2013

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