Gifts, Networks, Markets: Towards a Relational Theory of Digital Markets
Description
With the rise of network-economic value-creation contexts of a digital economy, we are dealing with a gift-economic transaction infrastructure that drives the transformation of markets. This becomes particularly evident in the way digital content is produced in social media – which leads to the emergence of effective supply worlds with stable demand responses – and in open-source software, which provides the functional preconditions for digital devices and commercial web applications. We are dealing here with allocation processes of a "networked public sphere" that are far removed from prices and are based on the economy of giving. However, to date, economic theory has failed to provide a satisfactory theoretical architecture that takes this insight into account. Trapped in an undersocialized economic theory, it is currently not possible to explain how social transactional networks influence the governance of markets. This becomes particularly evident in Yochai Benklers book The Wealth of Networks: How Social Production Transforms Markets and Freedom, where he attempts to theoretically reconstruct how cooperative arrangements drive the transformation of markets. In the end his approach falls short of expectations because Benkler does not succeed in conceptually processing one of his crucial questions: How can it be explained that the literature on the gift economy is considered marginal in economics, even though the governance architecture of a modern digital network economy is permeated by cooperative structures of give-and-take? One major reason why he cannot answer this question is that he has not studied the history of economic thought. If he had, he might have realized that Friedrich August von Hayek already provided an answer to his question. In following the materialistic anthropology of Hobbes which stands in contrast to the insights of ethology and cultural anthropology, public choice and new institutional economics lost the processual background understanding of what essentially keeps the creativity of the economy going. In not following Hayeks advice to take the insights of ethology and cultural anthropology into account, economic theory began to adhere to a legal positivist understanding of order. It lost sight of the fact that it’s the gift that is the expression and producer of a spontaneous order.