As noted in the previous posts, collaborative economy is not an accidental phenomenon, but it’s a whole ecosystem that has its own support and implementation in different socio-economic fields. Having in mind that the most of the pioneered economic writings, theoretical brochures and pamphlets came up in 19th century, offering different ideas and direction in which economy and society should evolve, we might find a socio-economic theory which could map to the ways in which collaborative economy practices socio-economy.
When we were looking for the roots of consumerism we found it nearly 100 years ago in the midst of the Great Depression. Consumerism was the solution imposed and accepted by the western economies. Obsolescence and desire were the main pillars of consumerism and demand. People where steered to consume, but how should one become economically potent to catch up with this trend, and how about fulfilling other psychological aspects of people’s behavior and satisfying needs such as success, prestige, self-actualization etc. People that are pro capitalistic never fail to call upon Charles Darwin and his theory of the survival of the fittest, where only the strongest will survive and continue the evolution of the species. This statement and its interpretation however true or false it might be is the perfect supplement of the consumerism, which fuels capitalism. Both desire and survival of fittest being part of different sciences and backgrounds seek for an economical interpretation that will incorporate them in an entity which will be a genuinely economic and can be used as a foundation of the western economic theory.“Homo economicus, or economic man, is the concept in many economic theories portraying humans as consistently rational and narrowly self-interested agents who usually pursue their subjectively-defined ends optimally. Generally, homo economicus attempts to maximize utility as a consumer and profit as a producer” (Wikipedia, Rittenberg and Tregarthen). The term economic man was first used by John Steward Mill in the 19th century, though some similarities can be found in Adam Smith’s work “The Wealth of Nations”. This human agent who is perfectly rational and selfish and who makes decisions out of the perfect flow of information is the foundation on which the invisible hand and market economy is based. The market supposed to sum up people’s rational needs and set an equilibrium of supply and demand, and achieving all that based on people’s rational decisions made on perfect and trustworthy information. The whole desire, obsolescence, survival of the fittest and homo economicus concepts are cornerstones of the today’s economic thought, but it doesn’t take into count human behavior and needs, imperfect information and access to information, education and knowledge, society and social awareness, all of which contribute to imperfect battlefield creating suspicious and tendentious economic theory which is tailored to fit certain interests.Is there an alternative to these generally established terms and definitions?The economic theory in the 19 century was heavily influenced by the first industrial revolution which drastically changed the economic landscape and prompted the academic thought. And not only economists, but philosophers, psychologist, sociologists etc., joined in on explaining and influencing the newborn society. It was a century of diverse and autonomous thought that very often touched the extremes in defining the future socio-economic system.One of these economic theories is called Mutualism which is just one of the many from the campus of anarchist school of thought.Mutualism as an expression can be found not only in the economic theory, but in the biology as well. In both contexts it means collaboration of different entities for mutual aid. The founder of this school of thought is Pierre-Joseph Proudhon (1809–1867) and many followers were to come among which Benjamin Tucker (1854–1939), Peter Kropotkin (1842–1921) etc.
According to Proudhon anarchy represents a society in which there are government and constitution which are aware of the public and of the private, and are based on science and law and which guarantee order and freedom. And that is about everything from the institutions. Proudhon speaks of mutualism as society of independent individuals who join in informal groups and where emphasizes are put on just and equal distribution of the added value of the joined labor from these informal organizations, cooperative lookalikes. As time will pass these organizations would merge and at one point would substitute the government. Kropotkin introduces the term homo reciprocans — humans as cooperative actors who are motivated by improving their environment, as counterpart of homo economicus and agents of the mutualist society.The economical profile of mutualism is to be found somewhere between the public ownership of communism and the free market of capitalism and its called social free market. It incorporates all known types of ownership but always making mutual aid and social welfare an imperative.
Lets go one by one in comparing the ways of collaborative economy and mutualism, to show its resemblance in certain aspects.
Government.
Mutualism-small administration from which the informal groups and individuals as the society’s building blocks would benefit. The government should participate in the process of allocation of means and profit, taxing and regulate labor rights.Collaborative economy-the role of the state is primarily in creating legislative for undisturbed flow of the collaborative processes, allocation of the capital, facilitating social innovation, taxing, reeducating etc.
Banks.
Mutualism-cooperative credit unions and mutual central banks are the forms of financial institutions in mutualistic society. The final goal is to come to interest rates close to 0.Collaborative economy-crowdfunding, microfinancing, services for transferring money etc. all of which are people funded and P2P processes that reduce the costs of financing.
Community.
Mutualism-informal and formal groups putting the well being of the community as a priority. Individual benefits derive from the healthy community.Collaborative economy- free software, wikipedia, couchsufing are just few of the communities and groups that are based on the common interests. All the platforms that are implementing the reputation systems are basically trying to maintain the ecosystem to stay in a fair and mutually aided frame.
Hierarchy and authority.
Mutualism-as a form of anarchy, hierarchy and authority are non existent in mutualism.Collaborative economy-authority is substituted by trust and freedom, while hierarchy with interaction, participation and responsibility.
Decentralization.
Mutualism-the informal groups which implies decentralization are the foundation of mutualism. At the final stage these informal decentralized structures should substitute the central government.Collaborative economy- internet and collaborative economy are by definition and by practice decentralized structures. In both cases everything revolves around individuals.
Labor as value.
Mutualism-defines labor as value and capital. The price of the product equals the labor spent in its making.Collaborative economy-marketplaces provide a way of lowering transaction costs, which leads to prices of the products to be closer to the production cost.
Redistribution of capital.
Mutualism-creating financial institutions as cooperatives or as a governmental subsystem is in direction of more equal redistribution of capital. Taxation on capital gains and inheritance is another way of addressing the redistribution of wealth issue.Collaborative economy-introducing individuals on the production side and reducing the amount of consuming on the demand side will surely have implications on societies and the distribution of wealth. Digitization has an inborn flaw by which it generates more wealth to the wealthy, but this is something that needs to be addressed by the governments.
Individualism.
Mutualism-anarchy as a concept resides on individuals. The informal grouping that is advocated by the mutualism goes in the direction of mutual aid and social awareness.Collaborative economy- the P2P concepts reside on individuals. Individual capital as knowledge, labor, asset, finance are the foundation of the collaborative economy.
Trust.
Mutualism-the trust among individuals as well as defining general goals and acting in mutual aid is incorporated in the definition of the mutualism.Collaborative economy-trust have been shifted from institutions towards individuals.Although it looks extreme, correlations between the mutualism and collaborative economy are there and as one of the distinguished proponents of mutualism Paul Goodman stated, “A free society cannot be the substitution of a ‘new order’ for the old order; it is the extension of spheres of free action until they make up most of the social life.” While the move towards a free society can be gradual, it cannot occur without “revolutionary disruption,” of some areas of society, “e.g., war, economics, sexual education — any genuine liberation whatsoever involves a total change.”Is the collaborative economy the socio-economic disruption societies needed in the age of the capitalistic malfunction and decline?
- the evolution of collaborative economy;
- supply, trade and demand aspects of the collaborative economy;
- the future effects collaborative economy will have on world economic processes;
- philosophical and economical concepts that can be perfectly mapped to the settings of collaborative economy;