1. The idea of the commons
and the future of capitalism
________________________________________________________________________________________________________________________________________________________________________________________
Yochai Benkler
Harvard Law School &
Berkman Center for
Internet and Society,
Harvard University
yochai_benkler@harvard.edu
Creative Commons Global Summit
Seoul, Korea, October 15, 2015

4. Pikkety, 2014
1980s an inflection point
Stress on the social environment
www.giss.nasa.gov
Stress on the natural
environment

5. Pikkety, 2014
Mostly in the US, UK, and Anglo
world; but
Emerging countries seem to be following
a similar pattern
Europe struggling with internal North /
South divide (Greece; Spain; new
members) and with migration to and
within the EU

9. Outcomes
99/90
99.9/99
99.99/99.9
90/50
50/10

10. Practices
99/90
99.9/99
99.99/99.9
90/50
50/10
CEO pay
Superstar
pay
Reference
group pay
Contingency; alt. work
arrangements
Diminished
bargaining
power
Globalization
& offshoring
Unemployment and
underemployment
Low wages
Outcomes
OECD Report: Divided We Stand,
Why Inequality Keeps Rising (2011)

12. Practices
99/90
99.9/99
99.99/99.9
90/50
50/10
CEO pay
Superstar
pay
Reference
group pay
Contingency;
alt. work
Diminished
bargaining
power
Globalization
& offshoring
Unemployment and
underemployment
Low wages
Outcomes Inst. Mechanisms
Stock
options
Norms/
Experts/ compensation
committees
Financialization
Tax rates: top personal; corporate
Capital; international trade
Weak labor standards & lax
enforcement
Deunionization; “right to work”
Reduced welfare payments
reduces staying power in
negotiations
Expansions of free trade rules
Immigration policy
Fed policy aimed at inflation;
Austerity
Minimum wage laws

13. “Ideology” in the colloquial sense is displaced by “ideology” in the Gramscian sense:
deregulation, free markets, “Washington Consensus” shifts from being a right wing
ideology to being an accepted “expert” position
Reagan-Thatcher
Clinton-Blair
One dimension of the future of capitalism: The neoliberal trajectory:
greater concentration of wealth; Oligarchic / crony capitalism born of
rational investment in maintaining rents
Ike, JFK, LBJ
Nixon, Carter

14. Practices
99/90
99.9/99
99.99/99.9
90/50
50/10
CEO pay
Superstar
pay
Reference
group pay
Contingency;
alt. work
Diminished
bargaining
power
Globalization
& offshoring
Unemployment and
underemployment
Low wages
Outcomes Institutions
Stock
options
Norms/
Experts/
Comp. Comms.
Financialization
Tax rates
labor standards
& lax enforcement
Deunionization
Reduced welfare
free trade
Immigration policy
Fed policy
Min. wage
Ideas
Rational actor model:
1. Incentives
2. Shareholder value
3. Agency theory
4. Collective action;
agency capture =>
Deregulation
5. Efficient markets
Shareholder value
Efficient markets
Efficiency & growth
primary goals,
distribution will follow

15. A certain view of humanity and social-economic organization
takes hold

16. Romer, Commentary, Fed. Res. Bank of St.
Louis Rev. 2005
Hyper inflation hits at the idea of an expertly-managed progressive state

17. It is then translated into discrete theories of how
the world works, and from there, to practical recommendations for
how well-adjusted executives and organizations should be managed
Agency theory

18. Pillars of neoliberalism
● Uncertainty and complexity => economic planning
impossible => Only prices in markets produce
good information
– Deregulation; financialization; tax cuts; lower
inflation trumps lower unemployment
● Rationality = self-interest
– Stock options; shareholder value vs. stakeholders
=> disinvestment in workers; contingent work
● Collective action fails => corrupts into illegitimate
power => deregulation
● Liberty depends on choice in markets
● Property rights + market incentives necessary and
adequate to achieve human welfare
________________________________________________________________________________________________________________________________________________________________________________________

19. Commons studies
● Facts, facts, and damn facts...
________________________________________________________________________________________________________________________________________________________________________________________

20. Free/Open Source Software________________________________________________________________________________________________________________________________________________________________________________________
Proprietary
FOSS
FOSS
Custom Linux based

21. Free/Open Source Software
________________________________________________________________________________________________________________________________________________________________________________________

22. Weber / Schumpeter
Taylor/Williamson
Second Industrial Divide
decentralized
centralized
Market-based Non-market
________________________________________________________________________________________________________________________________________________________________________________________

23. decentralized
centralized
Market-based Non-market
________________________________________________________________________________________________________________________________________________________________________________________
1980s-90s: Privatization

24. Networked Information Economy
decentralized
centralized
Market-based Non-market
________________________________________________________________________________________________________________________________________________________________________________________

25. decentralized
centralized
Market-based Non-market
Networked Information Economy
Citizens connect
________________________________________________________________________________________________________________________________________________________________________________________

27. CC-BY
CC-NC
CC-SA
CC-ND
CC-PD
“Mine” does not mean “for sale”;
Sharing does not mean erasing the self
A robust system of social exchange
independent of market exchange;
Building our own commons
An ethic of reciprocity
NOT collectivism; insistence on
choice and self-authorship
Creativity, freedom of speech and
thought, depend on a robust public
domain

28. Three schools of the commons
● CPRs
● Common property regimes
● Institutional Analysis and Development
● Local knowledge; effective self-governance
● Information commons / open access
● Open access / public domain
● Growth-oriented: roads and navigable waterways;
innovation & creativity; infrastructure; education &
science
● Not in the periphery, but at the core of the most
advanced economies
● Global commons
● Stewardship
________________________________________________________________________________________________________________________________________________________________________________________

29. Uncertainty and complexity
● IAD
● Uncertainty and complexity => standardized
property packets are lossy
● Local institutions can provide better resource
management and utilization than either central
planning or property-based markets
● Information commons / innovation
● Public domain / common-based exploration
allows for diverse people, using diverse
resources, to apply diverse knowledge and
experiment; an evolutionary model of learning;
property hampers learning
________________________________________________________________________________________________________________________________________________________________________________________

30. Resource space
(who knows what?)
Project space
(what shall we do?)Predictable, well defined diverse, uncertain, complex
Routine
Knowledge
Intensive;
Innovative;
Diverse
insights;
Tacit
High, concentrated
Exploration;
experimentationinnovationoptimization
Appropriability
Freedom
to
operate
Diversemotivations
Incentives
Tradeoffs
Risk
Uncertainty
Incontractible insights
Commons /
Public Domain

31. Commons-based production
• Production based on
• Utilizing inputs from a resource set in which
no one exerts exclusive rights
• Appropriating outputs without asserting
exclusive property rights in them
• Can be individual or collective, commercial
or noncommercial
• Examples
• Classic views of science
• Trucking, as opposed to railroads
• Party in a park, instead of a backyard
________________________________________________________________________________________________________________________________________________________________________________________

32. Commons-based production
● Individual or collaborative
● Commercial or noncommercial
● increases the diversity of actors,
motivations, transactional forms
● Important because it decentralizes
authority to act, paralleling what
technology/economy has done for
practical capacity to act
________________________________________________________________________________________________________________________________________________________________________________________

33. Commons and Capitalism
• Ostrom Commons:
• Discrete, stable communities that overcome
the logic of collective action, or the
systematic failure to organize absent
property and markets, or states
• Open Commons; knowledge & networks
• Public domain central to innovation
• Challenge to the unique role of exclusive
property in the creation of growth and welfare
• Rejection of the logic of accumulation
and its dominance over all other values;
embedding production in the social
________________________________________________________________________________________________________________________________________________________________________________________

35. Smart grid communications:
Critical Infrastructures________________________________________________________________________________________________________________________________________________________________________________________
Silver Spring Networks 20.00%
Itron 19.00%
Trilliant 1.00%
Elster 4.00%
Aclara 6.00% Tantalus 1.00%
Landis & Gyr 17.00%
Sensus 20.00%
SmartSync 3.00%
Echelon 3.00%
Unknown 6.00%
Market share by company and technology
Market share of
Smart Grid
Commnuications
Q1 2012
Pike Research

36. Mission Critical: Wireless Healthcare
________________________________________________________________________________________________________________________________________________________________________________________
Market share
Wireless Healthcare
Kalorama Information
September 2011

37. Mobile broadband
________________________________________________________________________________________________________________________________________________________________________________________
Share of iPhone data traffic Share of iPad data traffic
Source: ComScore Digital Omnivores, Oct. 2011

38. Mobile Payments; Access Control;
Inventory Management
________________________________________________________________________________________________________________________________________________________________________________________

39. Collective action
● Core target of Ostrom Commons studies
● Detailed studying showing the repeated stable
success of collective action
● “Well-behaved” governance models; sanctions,
proceedings, stable social norms
● Knowledge commons, culturally-constructed
commons, peer production: rich new grounds for
empirical refutation
________________________________________________________________________________________________________________________________________________________________________________________

40. Diffused Power, Degrees of Freedom
●
Commons-based licensing
●
Rough consensus/debate & discourse
●
Shared normative framings
●
Meritocracy
●
Redundant spheres of nested and
overlapping power
●
Formal and semi-formal institutions
●
Irreverence and resistance
●
Leadership, but limited by the other
pathways of self-governance and resistance
________________________________________________________________________________________________________________________________________________________________________________________

41. Homo Economicus,
Self-interest
with guile
Homo Socialis:
Diverse pro-social
motivations;
Competition & Cooperation
Control in tightly
coupled-systems
Self-direction,
experimentation,
ethical engagement
in loosely-coupled
systems
The Nature of Rationality________________________________________________________________________________________________________________________________________________________________________________________

42. Cooperative Human Systems

Conceptual: From “rationality” modeled as universal
self-interest translated into material concerns to
diversity of motivations and a preponderance of
prosocial humanity sensitive to conditions

Design: Cooperative human systems design based on
behaviorally realistic, evidence-based design;
integrating multiple disciplines, susceptible of testing
and implementation

Politics: We cannot separate out “incentives” from
fairness, ethics, empathy, solidarity, even as a matter
of effectiveness
________________________________________________________________________________________________________________________________________________________________________________________

43. Property-based incentives
● CPR studies
● “Washington Consensus” development
interventions can and do muck things up.
● Lose local knowledge
● Crowd out motivations
● Atrophy social enforcement mechanisms
● Information commons / innovation
● Patents & Copyright systematically misallocate
resources, undermine follow-on innovation
● Prices can crowd out volunteerism
● => Property is one tool in the institutional toolkit,
to be used where and as appropriate, but
susceptible to overuse
________________________________________________________________________________________________________________________________________________________________________________________

44. Freedom in the commons
● Information commons / innovation
● “Free as in free speech” => skepticism of
proprietary models
● Monopoly, incumbency, market power are
endemic; “free market” is a utopia, not a
descriptively useful category
● Resistance to “planned economy vs. free
markets” dichotomy; emphasis on self-
organization alternatives
● Strong affirmative autonomy claims; self-
expression and freedom to tinker
● Environmental commons
● Free markets lead to tragedy in the global
commons absent a governance system
________________________________________________________________________________________________________________________________________________________________________________________

46. The Commons as Idea
● People can effectively act collectively to
govern their utilization of resources
● We respond to diverse motivations,
economic utility and a range of social,
emotional, and rational ethical commitments
● Property and markets vs. state planning do
not exhaust the means of achieving growth
and material well-being
● Cooperative social action in commons can
also support growth, be more efficient, and
is sustainable
________________________________________________________________________________________________________________________________________________________________________________________

47. The Commons as Idea
● Production and resource management are
socially embedded activities
● Social embeddedness is not something
from which we need to free markets
● Freedom as effective self-governance,
individual and collective
● Property-based markets can undermine
freedom in both these senses
● Where markets disembed production, they
can do more harm than good to both
productivity and freedom
________________________________________________________________________________________________________________________________________________________________________________________

48. What is to be done?

49. Peer cooperativism
● The core of Free Software (as opposed to
Open Source) has been to build freedom
into capabilities, under conditions that
secure freedom to those who depend on
what you build and would be subject to
power were they dependent on a non-free
capability
● TCP/IP, HTML, FOSS, Wikipedia, WiFi, show
this is not a pipe dream
● Diaspora, Community Wireless, Firefox
HTML 5 DRM implementation show it is far
from easy or certain
________________________________________________________________________________________________________________________________________________________________________________________

51. decentralized
centralized
Market-based Non-market
Networked Information Economy
Citizens connect
________________________________________________________________________________________________________________________________________________________________________________________

52. Alienated labor?
Social context
and meaning at the
core.

53. Battle over the idea of
self-interested rationality as the core
model of human motivation
Subverting the possibility of socially-
embedded exchange as a core
model of provisioning in contra-
distinction to the tyranny of the margin
The “sharing economy”?
Is the market adopting
“embrace and extend”
of the rhetoric of peer
production and sharing
while undermining its core?

56. Socially-embedded markets
● High-commitment, high-performance
organizations offer a normative framing that
undermines the self-interested view of “it's
just business”
● Managerial and owner norms are important;
there is enough slack in markets for moral
commitments to make a difference
● Market outcomes will likely continue to be
the dominant driver of economic security for
a majority of people in the coming decades
● Will require battle of ideas; social pressure;
and legal reform
________________________________________________________________________________________________________________________________________________________________________________________

58. One company at a time,
But also the Fight for 15 and
regulatory battles over minimum wage

59. Peer Pragmatism
● Citizenship modeled on peer self-
governance
● Rejecting pure delegation conceptions of a
republic. Building platforms for active
engagement
● Skeptical, irreverent participation, committed to
debate, reason, and willingness to state and
defend normative commitments
● Nested, redundant, overlapping spheres of
power; subsidiarity to spheres of contribution
and knowledge
● Redundant pathways to invoke and avoid
governance
________________________________________________________________________________________________________________________________________________________________________________________

60. Peer Pragmatism
● Citizenship modeled on peer governance
● A progressivism aware of the fallibility of the
state
● Destabilizing power concentrations
● Caution about steering / paternalism
● Redistribution aimed at preserving autonomy,
rather than finely tuned to secure incentives
and supply predefined needs
● Investment in capabilities – education;
infrastructure; health
________________________________________________________________________________________________________________________________________________________________________________________

62. Peer Pragmatism
● Citizenship modeled on peer governance
● A progressivism aware of the fallibility of the
state
● A liberterianism aware of the fallibility of
markets and the limits of mutualism
● Global public goods, like climate and the
environment, global poverty and migration, war,
all require government- and intergovernmental
level collective action
● Effective institutions at all levels require
continuous engagement, because they all
unravel over time
________________________________________________________________________________________________________________________________________________________________________________________

63. At a societal level, beyond “State, Market, Society”
to diverse, more granular definitions
State
Market
Civil Society

64. The political
system
Education/
Academia
Established
Firms
Operating
In markets
Administrative/
bureaucratic
governance
Small businesses
Entrepreneurial
firms
Law
Social circles
Family
Media
State
Market
Civil Society
Innovation
State / municipal governments
Religion
Civic
associations

65. Degrees of Freedom________________________________________________________________________________________________________________________________________________________________________________________
● Diverse systems and subsystems are coming
under diverse pressures
● Each subsystem that we stabilize as a
commons, organize as a cooperative human
system is one dimension in which we can
anchor a socially-embedded productive life
● Bobbing and weaving between systems of
constraint an affordance, leveraging those that
are more resistant to power, disrupting flows
of power, is the practice of freedom
● The stakes are not utopia, but an achievable
renegotiation of the human condition under a
more socially-embedded form of capitalism