Value

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For Sensorica's working definition of value, see below.

But first, here's what we think value is not. Value is not a thing. As such, value cannot be stored or transferred, contrary to the conventional wisdom, which eventually leads to value fetishism.

Value is not a property of a thing, like colour or weight.

Moreover, money is not value and currency is not value.


This idea of value as a non-objective reality is not unique to OVN or Sensorica, as we can see in this interview with Chris Cook:

Pirsig blamed the ancient Greeks for turning everything into absolutes such as quantities. He realized that part of the Greeks’ legacy was a ‘subject-object’ metaphysics and grammar, and he proposed instead a metaphysics of quality which is indefinable or definable only in relative terms. Looking upon quality and value as two aspects of a non-dual reality, then in economic terms, if value cannot be defined, or is definable only in relative terms, we require a metaphysics of value that is qualitative, rather than quantitative. We need a way beyond objective metrics, such as energy, of evaluating those things that seem priceless, such as care and creativity. This is my ongoing mission…


Sensorica's working definitions

Value rests on a subjective experience that moves human beings into action. -proposed by Tibi

Think of value as a triadic relation between a valuable (a reality), a token (can be money, but also a symbol that doesn't represent a monetary currency) that stands for it, and a valuation, which is in part subjective and in part inter-subjective, i.e. shared, through culture and socialization.

This follows the same pattern as Peirce's theory of semiotics, the triangle of reference or semiotic triangle. In this case, the token is a representation of a desire/need that can be matched with a representation of anther desire/need. This definition can model non-monetary transactions like barter, as well as exchanges mediated by a monetary currency, like a purchase.

Note that this definition can be extended to other living systems, it is not only reserved to humans.


Valuation of something is an imaginary process by which an individual projects him/herself into the future trying to imagine how moved he or she would be by that same thing, or into the past, trying to remember an experience where he/she as moved by the same thing, modulated by present predispositions towards the same thing. The result of this process is circumstantial and characteristic to that specific individual.

Note that the valuation in our definition doesn't try to avoid mental states, such as desires and needs, which is something that modern economists try to avoid, only considering preferences, which they wrongfully equate with choices. There are good philosophical reasons to distinguish preferences from choices and also problems with empirical representations of preferences from observed behaviour. We believe that economics is not a positive science. We also question economics as a science, in the sense that there are no such things like laws of economics that can form the basis of explanation of observed economic phenomena. Moreover, economic events cannot be causally linked to past economic events. Furthermore, empirical observation of economic processes, based on statistics for example, undetermined any economic state, which is subject to multiple variables, some of which cannot even be known. There is no such a thing as a controlled experiment in economics. The prediction power of economic theories are always called into question, considering all the past bobbles and black swan events. Sometimes irrationality, human greed, and other personal motives or defects are better suited to explain such events. We cannot take the human out of economics, i.e. we cannot make abstraction of mental states in economics.

Other opinions on value

Re-imagining value

Re-imagining Value: Insights from the Care Economy, Commons, Cyberspace and Nature A report of DeepDive, Berlin, September 2016, convened by the Commons Strategies Group in cooperation with the Heinrich Boell Foundation and David Graeber.

p2p value

From p2pValue project, deliverable D1.2

The proliferation of communities of collaboration is creating significant problems for traditional conceptions of productivity and value. Indeed, the application of conventional value metrics is increasingly problematic not only in CBPP, but more generally in information and knowledge economics. New definitions of value are necessary in order to evaluate the contribution of the wide diversity of productive activities. However, the question of value in collaborative communities is not only an economic one, but also a question of justice. The problem of how to regulate and reward activities that are presently without a market value (e.g. the externalities produced by Free Software for the software industry) is contingent on the ability to find a rational and transparent measure of value.

On value sovereignty

From Michel Bauwens, during the DeepDive:re-imagining value, Berlin 2016:

“We cannot do without a value regime,” said Michel Bauwens, founder of the Peer to Peer Foundation and cofounder of the Commons Strategies Group. “Today, we have a dictatorship of one kind of value as delivered by the market system, which determines for everyone how they can live.” Consider how the labor of a nurse is regarded under different value regimes, he said: A nurse working as a paid employee is considered value-creating – a contributor to Gross Domestic Product. But the same nurse doing the same duties as a government employee is seen as “an expense, not a value-creator,” said Bauwens. The same nurse working as a volunteer “produces no value at all” by the logic of the market system. Bauwens said that his work in fostering peer production communities is an exploratory project in creating a new type of “value sovereignty” based on mutualism and caring. An important aspect of this work is protecting the respective community’s value sovereignty through defensive accommodations with the market system. “The peer production system lives a dichotomy,” explained Bauwens. “It is based on contributions for which we don’t get paid. We therefore have to interact with the market so that we can earn a living and get paid for what we have to do.” Maintaining a peer community within a hostile capitalist order requires that the community “create membranes to capture value from the dominant system, but then to filter it and use it in different ways” – i.e., through collective decision making and social solidarity, not through the market logic of money-based, individual exchange.

Open report of DeepDive, Berlin, September 2016

Related to contributions

A benefits distribution algorithm uses contributions to compute redistribution of benefits. During the early days of Sensorica, valuation was seen as a process of quantification, i.e. assigning, a quantity to a contribution to be able to compare it with other contributions (put them on a scale), to rank contributors, in order to distribute benefits to contributors in a way that preserves a shared sense of fairness for a critical mass (not necessarily a majority) of peers.

In these early days of Sensorica, Kurt asked the question: can a valuation process be built on [what he called] a value topology, i.e. using multiple orthogonal dimensions for valuation, a value space? What would constitute good dimension for valuation, i.e. proxies of value?

  1. They are meaningful
  2. Their meaning is conveyed to non initiates reasonably accurately
  3. They are composable
  4. They are orthogonal
  5. Their meanings do not overlap at a given level of composition
  6. They are quantifiable: may be directly measurable (in a mediated environment), or resolve to a measure based on human evaluation processes
  7. Ideally they require no effort to track beyond doing the thing that is being measured


Some candidate dimensions that were considered by Kurt can be found in his Value Mind Map. See more on http://mathworld.wolfram.com/Dimension.html.

A few years later, the p2p Value EU project proposed six diverse dimensions for valuation - remixed from p2pValue project:

  1. community building,
  2. objective accomplishment,
  3. monetary,
  4. social use,
  5. reputation,
  6. ecological.

One can also talk about an ethical dimension for a valuation process. For example, as members of open source communities consider themselves as part of the open source movement, they are aligned with the ethics of free sharing of knowledge.


Another way to look at the valuation process is from:

  • an individual perspective,
  • a community perspective, or
  • societal perspective.

Individual values can refer to more fundamental principles or beliefs, which are related to moral or ethical values. (...) ideological values such as privacy, freedom of expression, and individual agency or autonomy. The kind of intangible community valuables perceived by individuals that is considered as most important is knowledge sharing. Others are: learning; coherence with own ideology; and community building.


Following further Kurt's insights from the early days: the production of valuables (resources or others) rests on causes and conditions, which first create the potential of valuables being produced - the contextual probability to trigger a value experience, to move people into action towards some goal or outcome. A tool like the NRP-CAS is needed to attract these causes and conditions. Much of value remains tacit, then it becomes perceived, usually when the value experience is generated in context (application) by something tangible, from which we tend to project some future benefits (rightly or wrongly).

Example: If an affiliate reads a book he/she enriches him/her-self but nothing is added to the OVN that can persist independently of this affiliate. If the knowledge acquired from this exercise is applied to some activity within the OVN it becomes valuable if tangibly available (*attention, *concurrence from someone with that knowledge in a context where it is relevant and needed). Attention (engagement) is not valuable in and of itself, before anything is done.

There are two ways to perceive potential of valuables being produced,

  1. by them being identified as necessary to a project or venture (we need X for the project),
  2. by them being surfaced through conversion to more tangible forms of valuables (X can do Y in the project).

There are a number of valuation dimensions that speak more directly to the potential of a valuable being created. Knowledge is something we need to entice.

  1. *Surfacing relates to the realization of bringing knowledge into context.
  2. *Influence is something we need to entice.
  3. *Relationship is the realization of influence and
  4. *Introduction is its vector.

How to evaluate/quantify/measure *influence. See Klout

Types of valuables

We can speak about

  • Market / Exchange valuable (a product, something that can be exchanged/traded)
  • Use / commons / regenerative valuable (infrastructure development, creating tools for the group, etc.)
  • Social valuable (something that benefits a larger group of individuals)
  • Ecological valuable (something that benefits or at least preserves the environment)
  • Care valuable


Processes and valuables

Valuables can be material or immaterial, tangible or intangible. They can be created, transformed, exchanged, shared, consumed and destroyed, according to their property regime, or to the rights an obligations of agents associated with them. In production processes, individuals contribute with different types of assets (also valuables). On this wiki, we consider material valuables as resources.


Production processes are series of actions that lead to an outcome, to which agents may attribute value. This is about future states, prediction, a future desired outcome with its associated means and conditions of success. People decide to deploy efforts and allocate resources in such processes because they are moved into action by the valuation of future outcome. In an OVN, participation or engagement is contingent to a value experience that is provided within the organizational context in which the process is embedded. Note that most of the time the value experience is very complex. Sometimes agents are moved by the stated goal of a project (some type of artifact that is created) and sometimes agents are moved by the process itself, which may provide a learning experience, or the opportunity to meet new people, or to showcase one's skills. Affiliates of Sensorica are formalizing the practice or collaborative entrepreneurship, where it is explain that a collaborative entrepreneur must create the conditions to all these motivations to exist. In their jargon, Sensoricans talk about a "bundle of value propositions" that a collaborative entrepreneur must present to potential contributors.

Properties of valuables

Valuables in use are not always equivalent to valuables in trade, are not always equivalent to cost of production. Jean Francois Noubel puts it nicely by saying there are moveable valuables, measurable valuables, tradeable valuables, acknowledgeable valuables, and possible valuables.

Behind all human endeavours are value systems. Humans are moved by value, which arises when they face valuables, which are perceived, AND when they understand of how to get to these valuables and what is their potential, or what they can get out of them. People forge relations (collaborate for example) and coordinate their actions in ways to increase the probability of getting to the valuables that they perceive and in which they see potential, to increase their well-being in doing so, as well as for other various reasons.


Art Brock about wealth, he uses tradeable, measurable, rankable, nameable, possible.

Value as an organizing principle

Value synchronization is the coordination of value experiences among humans. This coordination generates dynamically stable patterns of social systems. The same way complex physical systems exhibit self-organization when energy/matter is exchanged with the environment, OVNs self-organize when valuables are expressed and acknowledged (accounted and reciprocated) internally and in relation to the external environment. Understanding value and valuation processes leads to successful designs of value systems with well-behaving attractors, which manifest themselves by high creativity, productivity AND a good feeling (positive reinforcement) about being part of such systems.


Value system models may combine three main approaches to design OVNs - living system/ecosystem view, - the game-theory - individual view - behavioral economics - crowd view - the ethical/philosophical collective view


Discussions

About the nature of value

We tend to believe that things have a priori value because we can reference almost anything to the market and associate a price to it. For example, we take 1 hour of work doing R&D in electronics and equate it with 50$ (market price on the labor market), or 1L of soap that has been consumed in an R&D process and equate it to its market price of 10$. Almost everything we use and do nowadays has a price associated with it, which we're told that comes from the market, and that gives us the impression that things have intrinsic value. Some even say that gold has intrinsic value, as if value is a property of the material. The market price is actually given by a market-based process, which assigns a relative measure of things used in exchange, in a given context, which is after generalized to other contexts, thus causing all sorts of problems. But something can have a 10$ market price and zero importance for me, I would never take it even if it was free. Also, people always give things to each others, car dealers always try to extract more money from their customers, etc. People operate outside of the market price assignment process, which is supposed to follow an idealized supply and demand law, all the time. Things doesn't have an intrinsic value. A thing is not valuable in and of itself, in a universal way. We usually refer to the market to assign value to things, but that's just using a particular system for valuation among many others, which doesn't satisfy everyone out there in all contexts. But the market has become dominant and thus we have created a quasi monopoly on valuation, what Michel Bauwens calls a tyranny of value.


Valuation in OVN processes

Exchanges (using payment) in a market must operate on a fix price, which is seen as a proxy of value of the thing that is exchanged (we need to agree on an equivalence during an exchange, how much of this for that). The exchange covers intermediate steps in the production chain (or the so called value chain), the last being the step of sales for consumption. Pricing is supposed to determine how much each step is 'worth' ($50 per hour for labour, $20 for a widget).

In an OVN, it is the consumption or the use of something in a process that determines if that thing is valuable. The thing can be transferred to the process by some type of transaction (purchase, lending, barter) or as a contribution. If the thing is transferred as a contribution, then it goes into a record keeping (usually the NRP-CAS, the ledger). The benefits distribution algorithm determines how all the contributions will be translated into distribution of benefits, and takes into consideration the steps in the production chain. In this case, it is the NRP-CAS which determines the 'worth' of a thing that is used in a production process. This worth can be represented in pricing or in any abstract currency.

In current times of economic transition, there is a hybridization between the OVN model and the market system. On the consumption side, this means that an eventual sale or pricing in the market will occur, mediated by a currency, and this currency income will be distributed according to a benefits distribution algorithm to participants. On the production side, this means that procurement might include something that is purchased (procurement through the market, as opposed to a contribution made by an affiliate), using a currency. The amount of currency used for this market-based procurement must be recorded as a contribution, therefore there is a need to compare this amount of currency with all other contributions in the context of this project. Moreover, this comparison can be dependent on the step in the production chain where this event occurs, at the time it occurs.

Consumption needn't be priced in currency. It could be evaluated in resources consumed (either by reference to the final form -the chair, or by reference to the inputs -skilled carpenter time, forester, mill, transport, energy consumption etc.). While a monetary system is perhaps 'simpler' on the face of it, it is in fact an illusion because the monetary system is quite complex and introduces manipulations in the valuation process and allows unfair benefits to those who run the currency (if this currency is centralized).

We can also look at the difference in terms of how risk is taken and ultimately how reward is distributed.

When someone pays for an intermediate result or 'input', they take on the risk that the use of that resource will allow them to produce a return. The party selling the resource has traded the risk of developing that resource further for the certainty of a price in the currency of choice. It is the difference in opinion on the future perceived value of that input and a difference of skill set to develop that input that cause the transaction to take place. The problem is that an information gradient can cause distortion in prices.

If I know I can sell consulting services at $140 an hour and you don't I can pay you $80 an hour and sell you for $140. In today's market that is called recruiting and it is a legitimate business.

If one takes the hybridized OVN approach to this scenario, there is no need for the intermediate transaction (the $80 per hour). It is the consumption of services that crystallizes the evaluation in the currency of choice. The benefits redistribution algorithm between the recruiter and the skilled labour is explicit and the $140 per hour will be divided between the parties. It may end up being the same split, but there is no hiding of information, and that makes all the difference.

In the pure OVN scenario there is no $140 per hour, only an accounting of what is done with the hour and its agreed upon evaluation method benefits redistribution algorithm. The folks that made that service are the skilled labour and the recruiter (and the recruiter's spouse who cooked them breakfast and the skilled labourer's mentors and instructors etc., to the boundaries of the benefits redistribution algorithm).

Pricing, it seems, permits a lack of information about the past inputs and future usefulness of a given intermediate result. This is quite a useful property, but it is a shortcut with consequences.

I hope we can minimize the subjective evaluation, or at least make it explicit in the benefits redistribution algorithm rather than unknown in people's heads.

More about the nature of value

Another way to formally treat value is as a triadic relation, similar to a sign (Peirce) or triangle of reference or semiotic triangle. This triadic relation is a pattern that recognizes a sentient being (posses a neuronal network for example, a system capable of symbolic representative and reasoning), a thing (reality) and a symbol. When it comes to communication, we have the thought or reference, the referent (the thing) and the symbol (the term or word). Meaning, which is communicated, is the triadic relation between the 3. This goes back to Emanuel Kant, which posited reality as unattainable by humans, a noumenal reality. In other words, the subject has access to reality mediated through perception, and can represent it through language, using symbolic representations. Value would follow the same pattern. Valuing is the thought, the object of desire, the thing is the referent, and a token (money) can be the sign. So value is the triadic relation between the 3.

Value is about the feeling of wanting, needing or desiring, that "thought" that we automatically have when we are facing a reality.

In terms of brain sciences, meaning and valuing are primal, pre-symbolic processes that enable humans to cope with reality. When we are looking at an object we cannot not create meaning, create a representation of that thing, its nature and its relation with other things around. At the same time, we cannot no generate a feeling related to wanting or needing or desiring when we look at a cone of ice cream. When it comes to value, we can speak about the Affective Neuronal Selection: The primordial emotional operating systems play a major role in determining the details of higher brain functions like cognition and secondary emotions. These genetically-based, multi-dimensional affective value systems guide behavior and survival.

The problem with the triadic relation is that it can lead to solipsism. Humans create meaning not just as individuals, by themselves, they also depend on their peers. Meaning is created individually and in community. The same goes for value. The community in which we live influences how we value things around us. There is an inter-subjective process involved here... For example, the mother can communicate to an infant in very subtle ways the meaning or the value of things. We are influenced by our upbringing to understand or value things in a particular way. In terms of brain sciences, we can think about mirror neurons as mechanisms to coordinate meaning, feelings/emotions and value. This mechanism can lead to symbiosis and stigmergy, as higher coordination mechanisms in more complex social settings.

see how Peirce solves this problem, communal meaning or meaning as a communal endeavour.


Although we can use the same pattern for meaning and for value, they are not of the same nature. For example, a theory of meaning can lead to a theory of truth, which can be applied to understand the court litigation processes. It turns out that humans are able to reach consensus when it comes to who committed a crime, but the same cannot be said about how desirable a thing can be, universally. One can draw a parallel between a court house and the market, for generating universally acceptable truths or price, but there is a fundamental difference between the two. The market process imposes a price on everyone, when the court house process leads everyone to reach the same conclusion (truth), based on inquiry and evidence. At the end of a litigation there is a good chance that everyone feels right with the verdict, although in the case of the market there are always people who think that they got ripped-off and people who think that they found a bargain, for the same thing, at the same price. Price is not of the same nature as truth. Evidence-based reasoning is not of the same nature as the market. Furthermore, evidence-based reasoning can be done by many individuals alone and when they meet to talk about it they may have reached the same conclusions. The market is a collective process and makes no sense do engage in the market one individual at the time. It is in that sense that the market imposes a price when a court house process helps people discover the culpable in a crime.

When economists speak about price discovery, it makes no sense! The price is not discovered as a universal valuation that everyone agrees with. This terminology is testimony to what Michel Bauwens calls the tyranny of value. This tyranny of value leads to a dysfunctional economic system, one that contains inequalities or unfairness by nature. It is not difficult to understand this... People operate outside of the market all the time, every time you buy a chocolate from kids who ring your bell at 10 am on a Sunday morning, or when a salesman gives a discount to a poor single mother. Ask car dealers how they come up with a price. The market mechanism applies well to commodities where competition is fierce and the theory of the market economy only works in unrealistic conditions, where there are no frictions, where there is total information symmetry, and so on and so on, as Slavoj Žižek would say.

Peirce was a pragmatist, and pragmatism, as a philosophical theory, can be used to treat value. In fact, we value things in relation to a need or desire, which leads to an action. There is a purpose, a goal associated with that thing.


Peter has argued that instead of using the semiotic triangle we should think about value in terms of memetics. In other words, people tend to value things that other people value. There's the lazy road, do like the others do, or even conformism, the fear of standing out or the comfort of going with the flow. We believe that this is already included in what has been said above. In other words, if value is this triadic relation between valuing, a token and a thing, the valuing experience can be a composite. I may experience the desire of an ice cream because I am hot, but at the same time that would also make me blend into the group, because all the buys in my class are also having an ice cream.

Towards a new formal theory of value and a new economy

Note: this is still speculative work. Here we try to provide a hint towards a new formalism that can become the basis of a new economic system, one that can be directly applied to commons-based peer production.


Premises

  • Value refers to a subjective experience and can only be described in relative and qualitative terms.
  • a valuable is a thing, which can be tangible (identifiable and quantifiable) or intangible (identifiable but non quantifiable).
  • property is applied to tangible valuables as bundle of rights and obligations


The idea is to conceive a system that allows fair and generative flows of valuables. In other words, how can we distribute rights and obligations for valuables that establish these kind of flows?


Deontic logic is a non-quantitative formal system (a type of modal logic) that can describe rights and obligations and their interactions.

Teleological logic, also known as teleology, is a a non-quantitative formal system derived from a philosophical concept that focuses on explaining phenomena by their end purpose or goal. It is a branch of causality that seeks to understand things in terms of their ultimate aim or function. Teleological reasoning often involves looking at the design, purpose, or intention behind something to explain its existence or behaviour. In the context of ethics, teleological ethics derive moral obligations from what is considered good or beneficial, emphasizing the consequences of actions rather than strict adherence to rules or duties.

So both formal systems are about obligations. One deals with rights as applied to valuables and the other one deals with the design, purpose, or intention behind something to explain its existence or behaviour, which can characterize the actions of agents with respect to valuables. So we can say that both systems can describe the action of an agent, framed by rights and obligations.


More needs to be added here...


In terms of implementation, this can make use of Ricardian contracts on a blockchain-based infrastructure to tie rights and obligations (of agents) to valuables, and trace the flows of these valuables in therms of access to use by various agents. Credentials can also be tied to all this as extra conditions of access to use.


Valuables can be:

  • scarce or abundant
  • rivalrous or non-rivalrous
  • consumable or usable (do not get consumed during use, can be used repetitively, can have maintenance costs)


This system must be able to deal with these realities...


One thought that comes to mind, after considering value as a triadic relation between an object of desire, a token and valuation, is that we may use something like the formalism developed by Peirce for his theory of truth to "reason" about value in a social setting. Thus, we can model Fiske's four ways of relating, which are also ways of allocating resources, more on the P2P Foundation, something that traditional economic theories cannot do. "According to Fiske, there are four basic types of inter-subjective dynamics, valid across time and space, in his own words: "People use just four fundamental models for organizing most aspects of sociality most of the time in all cultures. These models are:

  • Communal Sharing
  • Authority Ranking
  • Equality Matching
  • Market Pricing

We add stigmergy as yet another relational mode, more below.


Commons, in this context, individuals contribute to a group, and create a common resource, which in turn unlocks access to other resources. So commons economics are based on the relational logic of Communal Shareholding, through practices of commoning that create joint assets. Communal Sharing emerges as intersubjectivity does, with animate multi-cellular organisms. (This is why Communal Sharing carries forward a sense of an ideal past, which is perpetuated through ritual re-enactment.)

Authority Ranking is the mechanism for allocating according to status, either by birth as in the feudal mode, or through meritocratic selection. Authority Ranking emerges as organisms cope with loss of shared attention: Whose breach of shared attention is most important to follow? (This is why Authority Ranking carries forward temporal precedence; there is a serial ordering of events.)

Equality Matching is what is known as the gift economy, whereby individuals or groups give to others, creating a need to re-gift. People keep track of the balance or difference among participants and know what would be required to restore balance. It is mainly about equal-status peer-group behaviour. Equality Matching emerges as organisms coordinate attention through meaningful gestures and dances and perceive affordances of objects in their environments. (This is why Equality Matching carries forward oscillatory movements with cycles of reciprocal exchange, turn taking, and playful pauses.)

In capitalism, prices are the mechanism for guiding choices and behavior, this Fiske calls Market Pricing. To that we add stigmergy, as a fifth mode, which depends on signalling that can aggregate as priority or importance. Market Pricing emerges as human communities grow beyond what we are capable of tracking in informal networks of trust, allowing us to close off what would otherwise have been expectations of reciprocity. This is why Market Pricing carries forward a deliberate response to scarcity and, correspondingly, an emphasis on efficiency and proportionality: it develops—as David Graeber documented—not because barter was inefficient, but because our communities outstripped what we could cognitively track.


Stigmergy in gregarious beings is efficient coordination and organization without the need for direct communication. This indirect form of communication allows individuals to respond to changes in their environment and the actions of others, leading to emergent collective behaviours. Stigmergy facilitates efficient, decentralized coordination and organization in gregarious beings, enabling them to achieve collective goals that would be difficult or impossible to accomplish through centralized control or direct communication alone. There are various advantages:

  • Efficient Task Allocation based on the cues left by others. For instance, in ant colonies, pheromone trails left by foragers guide others to food sources, optimizing resource gathering without the need for explicit instruction.
  • Self-Organization: Through stigmergic interactions, complex structures and behaviours emerge without centralized control. For example, termite colonies build intricate nests by responding to local cues such as the presence of building materials or the layout of existing structures.
  • Adaptability: Stigmergy allows for flexible responses to changing environmental conditions. Individuals can adjust their behaviours based on the cues left by others, facilitating rapid adaptation to new challenges or opportunities.
  • Scalability: Stigmergy enables coordination and cooperation among large groups of individuals without the need for direct communication channels. This scalability is particularly advantageous in large social groups where direct communication might be impractical.
  • Robustness: Stigmergic systems often exhibit robustness to disturbances or failures of individual components. Since behaviours emerge from the interactions of many individuals, the system can often recover from disruptions without catastrophic failure.


Economic anthropology correlates economic conditions to the emergence of these relational modes:

from the P2P Foundation, ...it’s clear that it’s crucial to distinguish between two types of ‘tribal’ societies: First there are subsistence hunting and gathering societies, which have little or no stored surplus. Although it’s a big generalization, the dominant principle for production and exchange in these foraging communities is usually CS; they are often strongly anti-AR. Second, there are a few hunting and gathering societies with stored surpluses and there are agriculture-based societies, in which AR is prominent (institutionalized and more or less hereditary chiefs and then kings) and there are varying degrees of EM. In societies based predominantly on pastoralism, communities are much more fluid, but AR is also prominent. MP also very gradually emerges in agricultural societies, but pastoral societies are often resistant and opposed to MP. EM seems to become more dominant at a much later stage, with the rise of manufacturing, perhaps. Meanwhile, MP continues to expand right up to the present, but the mix gets complex! The best overview of these stages (although it doesn’t use RMT) is Allen Johnson and Timothy Earle, 2000, The Evolution of Human Societies: From Foraging Group to Agrarian State, Second Edition. It’s not elegantly written or tightly reasoned, but I believe they’ve got the facts right." (email, January 2009)


By analogy to Peirce's truth theory, we can say that the goal in economic transactions is to achieve a sense of fairness. So if truth becomes fairness, how can we model fairness in various types of economic transactions?


The following section is under development...


Communal shareholding

The principle here is reaching common goals, finding comfort and security in a group. This process is collaborative. It is also future oriented, projecting one's well-being on some form of communal capacity, latent or immediate.

A sense of fairness is achieved when everyone understands that they will be able to benefit from the shared capacity.

This requires mechanisms to avoid free riding or over-exploitation of the shared capacity.

describe transfer...


Authority ranking

The principle here is who deserves it. The process rank or merit.

A sense of fairness is achieved when everyone understands that security or effectiveness of economic processes is achieved when resource allocation follows those who know best, who are untitled to lead.

describe transfer...


Equality matching

The principle here is who needs it now and can reciprocate later. People keep track of the balance or difference among participants and know what would be required to restore balance. The settlement can be differed in time, thus requires keeping information about past transactions/interactions.

A sense of fairness is achieved when everyone is entitled to decide in context how resources are allocated. In other words, everyone understands that individual well-being is achieved when transactions concern only the individuals involved, according to what's best for them. This makes the resource allocation process distributed, decided by every individual in context towards another individual, based on an arrangement that seems to be fair for the two parties, regardless of what other peers say or think, akin to contractual relations. This is seen in libertarian settings, also in the crypto domain. Works well in small settings, as it requires keeping track, and can be scaled with a ledger.

describe transfer...


Market pricing

The principle here is who needs it and can afford it. This process is competitive, based on supply and demand, assuming perfect competition. The settlement is immediate.

A sense of fairness is achieved when everyone understands that economic efficiency is achieved when allocation of assets reaches a Pareto optimum, which is formally understood as market efficiency.

Pareto efficiency or Pareto optimality is a situation where no action or allocation is available that makes one individual better off without making another worse off.

Functions well when peers cannot keep track of past activities or cannot process a vast number of transactions at large scale.

describe transfer...


Stigmergy

The principle here is responding to priorities or importance ranking.

A sense of fairness is achieved when everyone understands that resources must be allocated wherever they are needed, based on what those who are involved in the process require. The emphasis is put on immediate need and priority. Requires an asynchronous signalling system, which itself requires some type of support to keep memory.

describe transfer...



In P2P economics we find a mix of all these relational modes. Market pricing is applied to scarce resources. Stigmergy relates to production processes, communal sharing relates to conditions for production, as in shared capacity, infrastructure. Authority ranking relates to redistribution of benefits and equality matching relates to small transactions, which fill the gaps of everything else. We need to understand that p2p is fundamentally non adversarial and recognizes that these relational modes have their place in an economy. Modern adversarial societies has produced ideologies around these modes because social governance is seen as an equilibrium of interests between different factions - through the mechanism of competitive representative democracy.

Question: How can we formally compute all that to generate a sense of fairness in a p2p economy?


Things to look at

  • Pareto efficiency
  • Pareto distribution - note that the long tail distribution is found in contributions in open processes, such as open source contributions.
  • Social welfare function
  • Rational and Social Choice Theory
  • Extended sympathy
  • Cardinal and Ordinal ordering, choice and welfare.

See also

External links