A set of principles, rules and economic models that lead to a legal framework to legitimize p2p, open and collaborative socioeconomic practices.

The 4th sector is proposed in continuity with the development of the public, private and the social (or solidarity) sectors.

Characteristics

Support

Organizations that are designed to function without the need of the State to support their existence and without the need the Market for their subsistence. They are non-registered organizations, local or transnational.

Examples:

Local 4th Sector organization would be a citizen-led group (type) for keeping a local park clean (mission), coordinated using a Facebook group, or a neighbourhood barter system, also coordinated using a Facebook group.
Transnational 4th Sector organization is the Bitcoin network (mission - global digital service of token transactions) or Sensorica (material peer production).

In other words, contrary to 3rd Sector organizations (non-profit and coops), who really on the help of the state (to get funding, to forge new relations, etc.), 4th Sector organizations are started and supported by individual members or affiliates.

Resources

Moreover, 4th sector organizations do not need money, or make use of very little monetary currency to function. One can say that 4th Sector organizations do not necessarily rely on charity / donations, government grants or revenue to thrive. When it comes to revenue, they don't need to offer goods of services, as they can operate completely outside of the market. But at the same time, they can displace products and services from markets through their economic activity. For example, an online group of open source software developers can create an application that they can distribute for free, making a proprietary software product obsolete.

Having said that, a lot of 4th Sector organizations do use money that they get through all the above-mentioned channels. For example, a local group of individuals that organizes on a Facebook group to clean a park, using every member's capacity (physical abilities, endurance and skills, tools and equipment), can ask for donations to purchase garbage bags, or to celebrate at the local bar, after the work is done. Or people who engage in Bitcoin transactions can create a market where they can trade the Bitcoin network for fiat currency. In some cases the interface between a 4th sector domain of activity and a market, or the use of fiat can be seen as a transfer of assets from one sector to another. For example, a group of local hackers can use a Government grant or some donations to purchase an equipment that they use as a shared asset, or as a nondominium form or property.

Property

Public sector relies on public property, i.e. assets owned by the state for use in government processes or by the general population.

The private sector relies on private property, which requires the State to guarantee, i.e. assets are owned by a moral entity (corporation) and are used in internal activities to produce marketable goods and services. Shareholders have total freedom to decide what to do with these assets.

Th solidarity sector relies on shared property, i.e. assets that are destined for internal activities that advance the mission of the organization, which is to create "social value" - see below. Commons is another property regime used in the 3rd Sector. Shared assets and physical commons need the protection oft he state. Often, the tendency of the private sector is to enclose shared property and commons.

The 4th Sector relies mostly on nondominium, i.e. assets that no one owns by everyone has access to use according to strict rules.

Having said the above, activities in all these 4 sectors may involve other forms of property. At this moment in time, the nondominium property is exclusively used ion the 4th Sector, since it has not been institutionalized, as with many o the 4th Sector practices.

Value

See more on value.

In the public sector we apeak about public value: It goes beyond traditional economic definitions of public good by focusing on the collective purpose and aspirations of society as a whole. Public value management involves considering the benefits and costs of public services in terms of societal values like equity, liberty, and transparency, not just financial metrics. This concept originated in the mid-1990s and aims to guide public managers in deploying public assets towards achieving public value as an end-goal

In the solidarity sector we speak about social value: the quantification of the relative importance that people place on the changes they experience in their lives. It goes beyond financial metrics and focuses on understanding the impact of decisions on individuals' wellbeing. Social value encompasses aspects like enhancing well-being, promoting economic policies for societal progress, and stressing sustainable processes for a viable future. By considering people's perspectives and values, organizations can make better decisions that increase positive impacts and reduce negative effects, ultimately contributing to overall societal well-being and a more sustainable environment

In the private sector we talk about market value: is the highest price a willing buyer would pay for a good or service and the lowest price a willing seller would accept for it in an open and fair market. It represents what investors or buyers perceive as the worth of a business, asset, or service. Market value is influenced by factors like supply and demand, buyer-seller negotiations, and available information. It differs from market price, which is the actual price paid by a buyer. Market value can be applied to consumer markets (goods) and investment markets (stocks/assets), reflecting the perceived value in each context.

Tokenization is often used to represent value within P2P decentralized systems. Incentive mechanisms, such as token rewards, are employed to motivate participants to contribute resources, validate transactions, or maintain the network.

The 4th Sector operated on this definition of value.

Incentives

Setting in motion initiatives in any sector requires skills. In the public sectors we talk about bureaucrats, in the private sector we speak about entrepreneurs, in the solidarity sector we speak about social entrepreneurs, in the 4th sector we speak about collaborative entrepreneurs.

A collaborative entrepreneurs must be able to put in place a multi-value system and build a web of incentives and motivations that entice people to participants / contribute. As mentioned earlier, these motivation and inventive systems tend to rely less on money.

Capabilities

4th Sector organizations are non bureaucratic, they rely on stigmergy and self-organization. As such, they are highly adaptable and are well suited to deal with complexity.

History

The term was proposed by Sensorica in May 2019, during their effort to create a legal framework for the collaborative economy in Quebec, Canada, published in the 4th Sector Rationale. This was done in the context of the NOICE initiative.

The NOICE project's main goal was to create a special economic zone in Montreal, Canada, to explore and experiment with p2p practices, collaborative economy, commons-based peer production.

The term 4th sector was strategically chosen by sensoricans to relate to the past development of the 3th sector in Quebec and make it easier for politicians to digest. It provided a road map based on the historical achievements of Le Chantier de l'Economie Sociale, a Quebec advocacy group that helped institutionalize the social economy in Quebec and throughout Canada. This led to the creation of social economy ministries at the provincial and the federal level.

4th Sector vs the 3rd Sector

The p2p, open and collaborative economy cannot be subsumed to the social economy. The legal forms created to channel efforts in the social economy are not adequate for open network type organizations that are prevalent in the p2p sphere. Moreover, the governance and economic models used in the p2p economy do not fully map into the social economy.

Social norms

4th sector social norms

The peer-to-peer (P2P) decentralized sector operates on a set of principles and social norms that emphasize decentralization, trustlessness, collaboration, and openness. These norms are foundational to various P2P systems, including blockchain networks and decentralized technologies. Here are some key social norms that characterize the P2P decentralized sector:

Decentralization

Norm: about governance, involves distributing control and decision-making across a network of peers rather than relying on a central authority. This enhances resilience, reduces vulnerability to single points of failure, and promotes a more democratic approach to governance.

Example: Community Governance: Participants in the network have a say in decision-making processes, protocol upgrades, and other matters that affect the ecosystem.

Transparency:

Norm: P2P processes provide almost unrestricted or unlimited access to information.

Permissionless - openness

Norm: P2P systems typically allow for permissionless access, which is about openness, meaning that individuals can engage in processes without seeking permission from a central authority. This fosters creativity and a dynamic ecosystem.

Open Source development embodies very well transparency and openness: Software, protocols, and technologies in the P2P decentralized sector are often developed openly, allowing anyone to view, modify, and contribute to the codebase.

Trustlessness

Norm: P2P decentralized systems are designed to operate in a trustless environment, meaning that participants can interact without relying on trust in a central authority. In the digital domain, trust is replaced by cryptographic algorithms and consensus mechanisms.

Immutable Ledger: P2P decentralized digital systems often utilize blockchain technology, creating an immutable and tamper-resistant ledger. Once data is recorded on the blockchain, it is extremely difficult to alter, providing a high level of security and transparency. Traditional methods use server-based databases guarded by admins, in which we need to trust.

Privacy

Norm: P2P decentralized systems prioritize privacy and control over personal data and information. Participants have more control over their own information, and privacy features are often built into the architecture of their information systems.

Cryptography for Security is often used for this, for securing transactions and communications in P2P decentralized digital systems. It ensures the privacy and integrity of data without relying on a trusted third party.

Consensus Mechanisms - Truth

Norm: Consensus mechanisms, such as verification by peers and peer review (proof-of-work or proof-of-stake in the digital sphere), are employed to achieve agreement among participants without a central authority. This is about establishing truth within organization or processes.

Interoperability

Norm: Interoperability is valued, allowing different decentralized systems and protocols to work together seamlessly. This norm promotes a broader and more inclusive ecosystem. This leans to the creation of networks-of-networks.

Resilience and Redundancy

Norm: P2P decentralized systems aim for resilience and redundancy to ensure the continued functioning of the network even in the face of disruptions or attacks. This is achieved through distributed architecture and multiple nodes.

These social norms collectively contribute to the ethos of the P2P decentralized sector, fostering a dynamic, open, and secure environment where participants can interact without relying on traditional central authorities. The decentralized nature of these systems aligns with principles of autonomy, collaboration, and the democratization of access to resources and information.

Public sector social norms

The social norms that underpin the public sector are shaped by the principles of public service, accountability, transparency, and the pursuit of the public good. While social norms can vary between countries and regions, here are some key principles and social norms that commonly define the public sector:

Public Service Ethic

Norm: The public sector is built on a strong ethic of serving the public interest. Public servants are expected to prioritize the well-being and needs of the citizens they serve.

Accountability and Responsibility

Norm: Public officials are accountable for their actions and decisions. There is an expectation that public servants should act responsibly, efficiently, and in compliance with established laws and regulations.

Transparency

Norm: Transparency is a fundamental norm in the public sector. Citizens have the right to access information about government activities, decision-making processes, and the use of public resources.

Impartiality and Fairness

Norm: Public sector employees are expected to act impartially and without bias in the execution of their duties. Decisions and actions should be fair and just, considering the diverse needs of the population.

Rule of Law

Norm: Adherence to the rule of law is a cornerstone of the public sector. Government actions and policies are expected to be consistent with established legal frameworks, ensuring a just and orderly society.

Political Neutrality

Norm: Public servants are generally expected to remain neutral and serve the interests of the public, regardless of political affiliations. Political influence on decision-making should be minimized.

Efficiency and Effectiveness

Norm: While public sector organizations may face bureaucratic challenges, there is a normative expectation for efficiency and effectiveness in the delivery of public services. Public resources should be utilized responsibly.

Inclusivity and Accessibility

Norm: The public sector should strive for inclusivity and accessibility, ensuring that services and resources are available to all citizens, regardless of socioeconomic status, ethnicity, or other factors.

Public Participation

Norm: Public participation is encouraged to ensure that citizens have a voice in decision-making processes. Governments often seek input from the public on policies and initiatives that impact the community.

Stewardship of Public Resources

Norm: Public sector employees are entrusted with the responsible stewardship of public resources. Fiscal responsibility and ethical financial management are emphasized.

Long-Term Vision and Planning

Norm: The public sector is expected to adopt a long-term perspective in planning and policymaking to address the evolving needs of society and ensure sustainable development.

These social norms collectively contribute to the establishment of a public sector that operates in the best interest of the public and upholds the values of democracy, fairness, and accountability. While challenges and variations exist, these norms provide a foundation for the ethical and effective functioning of public institutions. Private sector social norms

Private sector social norms

The social norms that underpin the private sector are influenced by principles of entrepreneurship, profit motive, competition, efficiency, and responsiveness to market dynamics. While specific norms can vary among industries and companies, here are some key social norms that commonly characterize the private sector:

Profit Motive

Norm: The primary goal of the private sector is to generate profit. Companies operate with the aim of maximizing shareholder value and financial returns.

Competitiveness

Norm: Competition is a driving force in the private sector. Companies strive to gain a competitive edge in the marketplace by offering innovative products, efficient services, and strategic advantages over rivals.

Customer-Centric Approach

Norm: The private sector places a strong emphasis on meeting customer needs and preferences. Companies aim to provide products and services that satisfy customer demands to build loyalty and gain market share.

Efficiency and Productivity

Norm: Efficiency is a key norm in the private sector. Companies seek to optimize operations, reduce costs, and enhance productivity to remain competitive and maximize profits.

Innovation and Risk-Taking

Norm: Innovation is encouraged to drive growth and gain a competitive advantage. Companies often embrace risk-taking as part of the entrepreneurial spirit, aiming for breakthroughs in products, services, or business models.

Adaptability and Flexibility

Norm: Private sector organizations are expected to be adaptable and flexible in response to changing market conditions, technological advancements, and shifts in consumer preferences.

Ownership and Shareholder Value

Norm: Private companies are owned by individuals, investors, or shareholders who expect a return on their investment. Decisions are often guided by the need to enhance shareholder value and fulfill fiduciary responsibilities.

Entrepreneurship and Initiative

Norm: Entrepreneurial spirit and individual initiative are valued in the private sector. Companies often encourage employees to take initiative, innovate, and contribute to the company's success.

Market-Driven Decision-Making

Norm: Decisions are often influenced by market dynamics, including demand, supply, and competition. Companies focus on aligning their strategies with market trends and consumer behavior.

Flexibility in Employment

Norm: Employment relationships in the private sector often allow for greater flexibility. Companies may adopt diverse employment arrangements, including part-time, contract, and temporary positions.

Corporate Social Responsibility (CSR)

Norm: While profit-making is a primary goal, many private sector companies recognize the importance of CSR. They may engage in socially responsible practices, contribute to community development, and address environmental concerns.

Performance-Based Rewards

Norm: Compensation and rewards in the private sector are often tied to individual and organizational performance. High performance is typically recognized and rewarded.

Incentives for Innovation and Creativity

Norm: Companies encourage a culture of innovation and creativity by providing incentives, such as bonuses or recognition, for employees who contribute novel ideas or solutions.

These social norms collectively shape the behavior and operations of private sector entities, fostering a dynamic and competitive environment focused on profit generation and market success. It's important to note that individual companies within the private sector may vary in their adherence to these norms based on industry, corporate culture, and business strategy.

3rd sector social norms

The cooperative or solidarity sector, non-profit organizations (NGOs), and other entities in the social sector are often built on principles that prioritize collaboration, community well-being, and social impact over profit. While specific norms can vary among organizations, especially considering the diversity within the non-profit sector, here are some key social norms that commonly characterize these entities:

Cooperative or Solidarity Sector

Cooperation and Mutual Aid

Norm: The cooperative sector emphasizes cooperation and mutual aid among members. Entities in this sector are often formed by individuals or businesses with shared goals, and they work together for mutual benefit.

Democratic Decision-Making

Norm: Cooperatives typically adhere to democratic decision-making processes, where members have an equal say in key decisions that affect the organization. This inclusivity fosters a sense of ownership and participation.

Shared Ownership and Control

Norm: Cooperative entities are collectively owned and controlled by their members. This shared ownership structure ensures that decisions are made with the interests of the entire community in mind.

Fair Distribution of Benefits

Norm: There is a commitment to fair distribution of benefits among members. Profits, when generated, are often shared equitably among members rather than being concentrated in the hands of a few.

Community-Centric Focus

Norm: Cooperatives prioritize the well-being of the community they serve. Whether in agriculture, finance, or other sectors, the focus is on meeting the needs of members and contributing to the local community.

Non-Profit Organizations (NGOs)

Mission-Driven Purpose

Norm: Non-profit organizations are driven by a mission to address social, environmental, or community needs. The primary focus is on creating positive social impact rather than generating profits for stakeholders.

Volunteerism and Altruism

Norm: Many non-profit organizations rely on volunteers and individuals motivated by altruism. Volunteers contribute their time and skills to advance the organization's mission without expecting financial compensation.

Accountability to Stakeholders

Norm: Non-profits are accountable to their stakeholders, including donors, beneficiaries, and the wider community. There is an emphasis on transparency and responsible use of resources to maintain public trust.

Advocacy and Social Justice

Norm: NGOs often engage in advocacy work and social justice initiatives to address systemic issues and promote positive change. They may work to influence policies and practices for the greater good.

Sustainability and Long-Term Impact

Norm: Non-profits often focus on achieving sustainable and long-term impact rather than short-term gains. Strategies are designed to create lasting change and address the root causes of social issues.

Collaboration and Partnerships

Norm: Collaboration with other NGOs, governmental agencies, and private entities is common. Non-profits recognize the importance of partnerships to maximize their impact and leverage resources.

Transparency in Operations

Norm: Transparency is a crucial norm in the non-profit sector. NGOs strive to be transparent about their operations, financial management, and the results of their programs to maintain credibility.

Inclusivity and Empowerment

Norm: Non-profits often focus on inclusivity and empowerment, seeking to involve diverse communities in their programs and initiatives. Empowering individuals and communities to be self-sufficient is a common goal.

Non-Distribution Constraint

Norm: Non-profit organizations operate under a non-distribution constraint, meaning that any surplus or financial gains are not distributed to individuals or stakeholders but are reinvested in the organization's mission.

General Social Sector Norms

Ethical Conduct

Norm: High ethical standards are expected in the social sector. Entities prioritize ethical conduct in all interactions, including fundraising, program implementation, and stakeholder engagement.

Community Engagement

Norm: Community engagement is a key norm. Whether in cooperatives or non-profits, involving the community in decision-making processes and understanding their needs is essential.

Public Benefit Orientation

Norm: The overall orientation is towards providing a public benefit. Entities in this sector aim to contribute positively to society, whether through economic cooperation, social programs, or environmental initiatives.

Flexibility and Adaptability

Norm: The social sector values flexibility and adaptability to respond effectively to changing circumstances, emerging needs, and evolving community dynamics.

Measuring Impact

Norm: There is an emphasis on measuring and evaluating the impact of programs and initiatives. Non-profits often engage in rigorous impact assessment to ensure accountability and continuous improvement.

These social norms collectively contribute to the unique character and mission-driven focus of entities in the cooperative or solidarity sector and non-profit organizations. They reflect a commitment to values beyond financial gain and a dedication to making a positive difference in the lives of individuals and communities.

Fourth sector

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