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Profit and Gift in the Digital Economy: extract from chapter 10

This text, from the closing pages of the book, calls for a different kind of economy: an evolving diverse economy with more space for gift and alternative forms, and much less for the more oppressive forms of capitalism. If they are successful, books like this one form part of a spiral in which political arguments and political movements influence each other and develop iteratively.

How to change the economy

How, then, might we go about changing the economy to better meet human needs? Recognising the diversity of our existing economy provides grounds for some limited optimism about the possibility of significant economic change. The domination of our economies by capitalism is less than it might seem from the prevailing discourses of the economy, and it must be possible to build alternatives alongside capitalist economic practices since many alternative forms are already thriving. This perspective allows us to transcend the binary choice between total capitalism and its total overthrow that has often been characteristic of Marxist politics (though there are encouraging signs of Marxist thinkers who are also looking for alternatives to this binary). Instead, we could change our economy by progressively altering the mix of economic forms, steadily reducing the more harmful forms of capitalism and building more human forms of economy alongside. Indeed, it is only if we do build alternatives alongside capitalism that viable alternative economic futures can be developed, and we should welcome the work of thinkers like Erik Olin Wright and Yochai Benkler who are examining some of the ways in which this could occur.

A role for capitalism

On the other hand, however, this optimism must be qualified. As we have seen, alternative appropriative practices can themselves be entangled in capitalist forms, and ultimately the viability of alternative forms will depend not only on growing them within our existing economy but also on finding ways to criticise and curtail the role of capitalist appropriative practices. Capitalism, despite being only part of our contemporary economy, is still capable of generating massive harms – notably extreme exploitation, alienation, inequality, massive distortions in the use of resources, environmental damage and support for oppressive political regimes. It is still backed by enormous political and discursive power, and it constantly tends to subvert alternatives to its thirst for profit.

Once we recognise that capitalism itself is diverse, however, we may find that there are some forms of it, suitably regulated, that make a positive contribution overall to our well-being. Given this possibility, we can no longer simply dismiss all capitalism on the grounds of Marx’s spurious theory of exploitation. Instead of applying the formulaic dogma of Marx’s labour theory of value, we need to evaluate forms of capitalism by identifying their real tendencies and assessing their actual effects against explicitly stated and justified ethical standards. When we do so I believe we will find, for example, that forms of capitalism that rest on the provision of free content by users are considerably less harmful than those that rest on the extraction of minerals by slave labourers in Africa (Fuchs, 2014, pp. 172–81) and those that rest on the creation of unstable financial assets. These forms can be separated. They are not all parts of one monolith, and they should be treated differently: lightly regulated, heavily regulated or abolished entirely depending upon their impact on human flourishing.

A role for the gift economy

Alongside the less harmful remnants of the capitalist economy, we need to support the development of other forms. The state has an important continuing role to play in the provision of essential services that are made available to all irrespective of their ability to afford them, and in the provision of public goods that we all benefit from. Non-capitalist commodity forms should also continue to be important: family businesses and co-operatives, for example. But the gift economy, particularly if we include large parts of the household economy, is already as important as these, and the digital gift economy is particularly promising. As we have seen, the gift economy is particularly suited to the distribution of digital goods, with their trivial marginal costs, and innovative forms of collaborative production have flourished there, with benefits not only for the users but also for the creators of the content that they share.

Nevertheless, there are also good reasons to restrain claims for the potential of the digital gift economy. One limitation arises from the same factors that give the digital gift economy its advantages: virtually costless distribution of gifts that entails no sacrifice by the donor is only a characteristic of digital information goods. There is little reason to believe that similar economic processes might roll back the non-digital market economy in the way that the open-source movement has generated a tendency for the decommodification of software. Indeed, the digital gift economy itself clearly depends on other sectors of the economy that are currently dominated by the market: for example, the hardware and networks that make the digital gift economy possible are themselves physical products created in the commercial economy, and independent programmers that contribute to open-source software must have other sources of income to support them, which are often derived from the commercial economy (Barbrook, 2005).

Certain elements of the digital gift economy also face attempts at outright suppression by government, acting in the interests of pre-digital media corporations. Most notably, governments have been persuaded by lobbyists for these corporations to extend copyright protection in an attempt to prevent the free distribution of vast amounts of digital media products (Gillespie, 2007, chapter 4; Lessig, 2004). Open-source software seems likely to escape this, partly because of some clever work on copyleft licensing, but perhaps more so, ironically, because of the many ways in which it has become embedded in commercial business. Many IT businesses have found ways to make money out of open-source software, and at least some major open-source software products are predominantly developed at the expense of such companies (Elder-Vass, 2015c). But this is only half of the picture: we must also recognise that commercial companies are amongst the largest beneficiaries of the financial savings that arise from using free open-source software – these savings are a major reason for the massive ‘market’ shares of products like Linux and Apache.

Such entanglements warrant scepticism towards suggestions in the literature that phenomena like open-source software herald the replacement of capitalism (Berry, 2008, p. 98). But once we recognise the diversity of the economy, we no longer need all-or-nothing alternatives to capitalism. The issue we face is not a choice between a gift economy and a commodity economy; the issues are how much of the economy will take a gift form, what kinds of gift form, how much will take a commodity form and what kinds of commodity form.

Towards an open future

Let me end…  by asking what role a book like this can play in advancing such changes. Books alone do not change the world; any impact they might have depends upon influencing people, and movements of people, but where are the movements that might back a progressive shift towards a gift economy? Part of the problem we confront is what David Harvey calls a ‘double blockage’: ‘the lack of an alternative vision prevents the formation of an oppositional movement, while the absence of such a movement precludes the articulation of an alternative’ (D. Harvey, 2011, p. 227). As Harvey rightly says, the solution to this double blockage is inevitably iterative: the relation between these two absences ‘has to be turned into a spiral’ (D. Harvey, 2011, p. 227).

That spiral is already in progress, though its overall direction is uncertain. There are already movements working towards aims compatible with the ideas expressed in this book, for example Green parties, the Occupy movement, many of the groups that combine in the World Social Forum, and the movements against austerity policies in Europe. And there are already huge numbers of people participating in gift forms of economy. Though many of them do not even recognise that they are forms of economy, these are people who could be persuaded to back further growth of these forms. There are already, too, writers expressing ideas that complement those in this book, for example those who have contributed to the Convivialist Manifesto (Clarke, 2014), and those whose work is collected in The Human Economy (Hart et al., 2010). This book and the political economy of practices that it advocates are, at best, another turn of the spiral, one that encourages a more open but more realistic alternative vision of a future that could enable more of us to flourish rather than being subjected to a logic of pointless accumulation that ultimately benefits no-one.

We cannot know exactly what kind of economy and what kind of society this will lead us to, not least because there is no end point and no single overriding logic to social development but rather a continuing process of change in a fundamentally open system. The mix of economic forms within that system will inevitably develop in response to emerging possibilities but it is up to us, collectively, to find ways to encourage those forms that seem most beneficial for all human beings in the light of ethical debate. We will only be able to engage productively in such a process by abandoning monolithic visions of nirvana and working instead towards multiple partial real utopias. This is not a step backwards but a step forwards for progressive politics: we must reject the dogmas of both of the old political economies and instead engage creatively with our diverse economy and its open future.

[This post reproduces text from pages 228-232 of Elder-Vass, D. (2016) Profit and Gift in the Digital Economy, Cambridge: Cambridge UP.]

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