Candice Holdsworth
Candice Holdsworth

Gift economies: They’re free but they’re not *free*

*Part 3 on the notion of “free” and the scalability of gift economies

Lily Cole’s has launched in beta at Cambridge University. It seems the purpose of this limited roll out is to get a better measure of how people use and interact with the site, before launching it globally.

I’ll be watching its progress with some interest. So far the requests on the homepage seem to be light-hearted and fun. One person asked to be taught “how to do a somersault”; another requested “simple and easy vegetarian recipes”.

Whether or not this will scale remains to be seen. But as one of Impossible’s advisers, Jimmy Wales, can attest, gift economies scale remarkably well on the internet.

In fact, Wikipedia’s phenomenal growth challenged a great deal of conventional wisdom on the scalability of gift economies

Until the advent of the world wide web, it was commonly understood that so-called gift economies are unable to scale. It has been observed many times before that once communities of this kind reach a certain size, the bonds of social obligation become weaker and weaker until they are eventually unable to sustain themselves. At that point we begin to speak of having “interests” rather than “friends” and exchanges become more transactional.

However, in the internet age this perception has been radically altered with sites like Wikipedia, which is free to use, maintained (for the most part) by a global network of volunteers, and funded almost entirely by donations.

An incredibly successful experiment in crowd sourcing, it has become the cheat sheet of choice for anyone seeking even the most obscure of knowledge on even the most arcane of topics.

A wonderful, free online resource.

But is it really free? And how was it able to scale so significantly without monetarily compensating its vast array of, mostly anonymous, contributors? There are perhaps a number of reasons for this. The two most important, however, are:

a) Post-scarcity.

b) Participating in an online community like Wikipedia does not carry onerous social obligations.

Although it is “free” at the point of access, in reality, Wikipedia is not “free” at all.

Rather, those that have regular access to sites like this exist in conditions of “post-scarcity”, in which the technology needed to access Wikipedia or to host the site is cheaper and more readily available than it has ever been before.

It is relatively inexpensive in much of the developed world, and some developing economies, to buy a computer, purchase a broadband package, or host a website. These costs are not significant and can be borne quite easily by an individual on an average income. Amassing huge numbers of people has never been easier

And as the volunteers who edit and maintain the site are hobbyists of sorts, people who have security of income, the task of editing Wikipedia is not particularly taxing.

It is, in fact, somewhat of a leisure activity, more of an exercise in reputation management than anything else.

However, when it comes to convincing people to exert a great deal of energy over a sustained period, at considerable risk or cost to themselves (this may not always take the form of money but could also be things such as time etc.), it takes a little more than reputation management to convince them. Then we really begin to speak of “mutual interests”. For these reasons I do not think gift economies can ever replace traditional “transactional” economies, which relates closely to (b) “ … Wikipedia does not carry onerous social obligations”.

It is a forum where people are allowed to associate and disassociate at will. There are no heavy obligations associated with being part of the Wikipedia community, which is perhaps the perfect context for gift economies to flourish.

Attempts, in the past, by the communes of North America in the 1960s and the kibbutzim of Israel, to form these types of alternative societies failed when their members felt their own individual interests were being stifled or usurped by the oppressive nature of the group (H/T @CausticPop for the link on Twitter), on both a personal and professional level.

People didn’t want to outsource the raising of children to the group, they wanted to form nuclear families; they wanted to study philosophy and literature, not “practical”, vocational degrees that better served the community. In Israel, in the early 1980s, many of the kibbutzim simply became economically unsustainable. The youth left in their droves, in search of prosperity and professional fulfilment.

They nearly died entirely. But some managed to reform.

And nowadays, these sorts of organisations resemble Wikipedia a lot more: a collection of individual interests that come together to achieve a common goal with no restrictions other than what would be considered reasonable.

When one observes the group dynamics of these micro societies, it is plain to see that their members derive a great deal of pleasure from the feelings of oneness that singing and dancing and being in close, cooperative quarters with others can provide. The philosopher Avishai Margalit, who was raised in a kibbutz, describes the sense of euphoria that the dissolution of the ego engenders.

Many others will have experienced this at raves or festivals. I certainly have.

As social creatures, we human beings want to be part of collectives, but not at the expense of our own individuality.

To truly thrive and prosper we must collaborate, but also, crucially, have the space to be inventive and innovative and not be subject to the possessiveness of others.

Hardly anything is ever “free”. It is a misnomer to speak of it as such. The true value of gift economies lies not in the fact they provide goods and services free of charge. It is the opportunity that they provide for human beings to express themselves through group bonding.

They scale successfully when people are able to come together with ease and also to break apart with ease.

Indeed we are living through exciting times.

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  • The gift economy: Would you give your stuff away?
  • 8 Responses to “Gift economies: They’re free but they’re not *free*”

    1. I would not cite Wikipedia, file sharing or open source software as examples of gift economies at all. Regardless, such free sharing of ‘gifts’ presupposes the existence of capital goods already. It’s thus not a model for production, but a consumption model that relies on the underlying distribution infrastructure. What’s a gift economy to do when it requires production?

      The reason why Wikipedia, file sharing and the open source software movement do so well is not because they provide a framework where people can gift freely, but because the first carrot in front of your nose is immediate benefit. You get the knowledge of Wikipedia first, before you need to edit a page or provide content. Same with file sharing and open source software: Get the benefits now, but perhaps never participate in the production line. This is why Wikipedia scales well while most proper gift economies never did: It’s not an economic system, just a parasitic one.

      May 25, 2013 at 2:28 pm
    2. Free? #

      Whilst we have a market that, to a large extent, has surpluses – the old equipment nobody wants anymore as they have probably replaced it with newer items, its very easy to offer stuff for free. I’ve yet to see someone manufacture a toaster or a microwave from scratch (or even print a book for that matter) and then give it away to someone for free. The ‘free’ markets that I have seen have essentially consisted of old second hand stuff that folk want to get rid of, but that stuff had to be bought in the first place – so it’s not ‘free’. I find the more useful approach is how charity shops operate – unwanted goods are dropped off and then sold, the cash going to various charitable organisations. Yes, free Indian head massages and the like are nice, but no-one can live on those alone. Free food- perhaps another matter, yet that food had to be grown from some resource in the first place, so is it free?- only to the person receiving.
      ” People didn’t want to outsource the raising of children to the group, they wanted to form nuclear families; they wanted to study philosophy and literature, not “practical”, vocational degrees that better served the community.” – yes, there’s a budding philosopher born every minute willing to dispense free ‘ guidance’ , but where are brick layers, machinists etc?

      May 26, 2013 at 9:25 am
    3. @Garg and @ Free?

      I’m not sure whether you’re agreeing with me or not? That’s exactly my point. These things are not technically ‘free’, that’s why I say it’s a misnomer to speak of it as such. That’s why I say it can only exist in conditions of post-scarcity.

      But I think they could be classified as gift economies, in the sense that the ‘product’ i.e knowledge, expertise etc. is given with no expectation of a return?

      @Free? I completely disagree with your last point. Philosophy and Literature are not subjects one simply stumbles into. It requires a great deal of learning and hard work to do them properly. Bricklaying is a far less skilled activity. And there are a lot more people willing to do it.

      May 26, 2013 at 2:11 pm
    4. @Free? I strongly recommend that you watch the documentary I linked to about the kibbutzim. Those who founded the kibbutzim were a mixture of philosophical and physical grit. They built their homes with their own ideas and their own hands.

      Both were required to keep them going.

      May 26, 2013 at 2:36 pm
    5. @Candice:
      I’m agreeing with your opening statement and yes, we are in agreement for the most part. Gift economies did however have an expectation of reciprocity. People who participated in gift economies of the past did so while expecting either something tangible or something non-tangible like social prestige in return, just not on the spot. The updated gift economy term is an anthropological pipe dream to try and persuade the disenfranchised occupy crowd of anarchist political leanings Most of their examples are either murky or do not lead to the kind of results worth emulating.

      The “Wikipedia is an example of x” snowclone is close to meaningless. Even if I agreed with the notion that Wikipedia is a new and improved gift economy, it’s not characteristic of the state of affairs for this brand of gift economies in general. Without a notion of reciprocity or a similar fairly stable balance of incentives and risks, a tragedy of the commons scenario is nearly inevitable when it comes to goods. When it comes to post-scarcity things like Wiki knowledge, it still relies on infrastructure and human capital. So sure, free markets but not really free and not really markets.

      May 26, 2013 at 5:16 pm
    6. bernpm #

      Reminds me of the story of this old Sheik. They just found oil on his land. So he called his advisers and asked to explain him the basics of economics.

      The guys came back with a multi page book. He gave it back and said: “too much for me to read”. The team went off and came back with a compressed version: The short guide to economics” . The sheik rejected it again and send the team away.

      Next day one of the team came back and gave the sheik a sheet of paper. The sheik red it and was pleased. The paper red: “there is never a free lunch”.

      Lesson? “free economics do not exist”.
      In my early years of studying economics, we were taught about free economic goods: water, air and land. Today we know that none of them were free, we only did not have to pay for them. Now, 60 years later, we do!!!

      May 27, 2013 at 12:02 am
    7. Some very interesting thoughts from Jaron Lanier on this subject:

      May 29, 2013 at 2:24 am
    8. Great find, Candice! Will watch that at some point.

      May 30, 2013 at 11:37 am

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