Impact with a Meaning
“Purpose is what gives life a meaning”.
― Charles H. Parkhurst
CONTENTS
Beyond online reputation: The basis for an emerging purpose economy
Opportunity for new economic systems
Opportunity for new economic systems
Money is yet another information system
The Purpose economy inside an ecosystem of economies
The gift economy
The market economy
The complementary economy
Principles for a Purpose economy
A relational economy
Trusted networks
The two sides of online trust
The individual side and self-confidence
The collective side and reputation
Self-governance and the rise of leadingship
The role of data in the relational economy
Facts and forecast
Conclusion
References
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In an economy of relationships
relational graphs are the new currency.
We understand relational graphs as diagrams representing a system of interrelations among two or more things.
relational graphs are the new currency.
We understand relational graphs as diagrams representing a system of interrelations among two or more things.
Google built the search graph, Facebook the social graph, LinkedIn the professional graph,
Twitter the real-time news graph, …
Who will build the purpose graph?
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BEYOND ONLINE REPUTATION: THE BASIS FOR AN EMERGING PURPOSE ECONOMY
While social media is facilitating a new type of engagement, what is the spell that restrains over two billions social network users who would revel in inspired actions from having a more purpose oriented imprint in the world? The collective impact remains quite shallow in comparison to its potential. While we have so many people sharing stories and tweeting every day, how can these people have a more profound impact in the offline realm? The ability to generate trusted relationships between users who don’t know each other is - in our sense - the main challenge to work out.
Day-to-day online interactions leave a digital footprint that may unleash a new type of exchange if we can make sense out of it. When talents and qualities can be captured and publicized through social recognition, reputation builds up trust which propagates primarily in low degree of social distance. Such an economy based on relationships can leverage tremendous social impact. We believe there is a blue ocean in front of us. The ground is ready for a new type of economy based on reputation and social recognition that can bring the attention economy currently expressed by the number of “followers, likes, thumbs up, upvotes and +1” to the one of purpose.
This new economy is not meant to replace the traditional market or gift economies ; each economic system is designed for an agenda, each system has its own limits. A new economy driven by meaningful achievements - not by profits - can supplement the old economies where they are less effective, within the social media context. When it comes to the future of money, we hear about a cashless society, mobile payments, we hear about digital, virtual[6], alternative, complementary or reputation currencies; we hear about big data[6a] and social graphs. But how these concepts relate to each other; that we don’t hear too much about.
While social media is facilitating a new type of engagement, what is the spell that restrains over two billions social network users who would revel in inspired actions from having a more purpose oriented imprint in the world? The collective impact remains quite shallow in comparison to its potential. While we have so many people sharing stories and tweeting every day, how can these people have a more profound impact in the offline realm? The ability to generate trusted relationships between users who don’t know each other is - in our sense - the main challenge to work out.
Day-to-day online interactions leave a digital footprint that may unleash a new type of exchange if we can make sense out of it. When talents and qualities can be captured and publicized through social recognition, reputation builds up trust which propagates primarily in low degree of social distance. Such an economy based on relationships can leverage tremendous social impact. We believe there is a blue ocean in front of us. The ground is ready for a new type of economy based on reputation and social recognition that can bring the attention economy currently expressed by the number of “followers, likes, thumbs up, upvotes and +1” to the one of purpose.
This new economy is not meant to replace the traditional market or gift economies ; each economic system is designed for an agenda, each system has its own limits. A new economy driven by meaningful achievements - not by profits - can supplement the old economies where they are less effective, within the social media context. When it comes to the future of money, we hear about a cashless society, mobile payments, we hear about digital, virtual[6], alternative, complementary or reputation currencies; we hear about big data[6a] and social graphs. But how these concepts relate to each other; that we don’t hear too much about.
OPPORTUNITY FOR NEW ECONOMIC SYSTEMS
“In the winds of change some build a shelter, others a windmill”.
Chinese wisdom
Why is the concept of purpose economy timely? The idea of purpose economy is part of a new realm where intangible assets are valued, where human and social capital are taken into account, and where wealth is understood beyond its sole monetized dimension. By entering the post-industrial era – also coined as the knowledge society[1] – and its new sets of values, we slightly shift away from the dreary Gross Domestic Product index to the more blissful Gross National Happiness mindset.[2]
Human exchange can't always be reduced to an economic transaction, it can also be a good in itself in the form of a personal relationship and the concept of the economy strictly limited to the "wealth and resources of a country" is relatively recent.[7] The British economist Avner Offer names this broader economic framework the economy of regard. Regard encompasses the dimensions of reputation but also the ones of acknowledgement, attention, acceptance, respect, status, trustworthiness, power, intimacy, love, friendship, kinship and sociability. While these social rewards may seem far fetched from an economic point of view, neuroimagery demonstrates that “our brains neurologically compute personal reputation to be as valuable as money”.[8]
Human exchange can't always be reduced to an economic transaction, it can also be a good in itself in the form of a personal relationship and the concept of the economy strictly limited to the "wealth and resources of a country" is relatively recent.[7] The British economist Avner Offer names this broader economic framework the economy of regard. Regard encompasses the dimensions of reputation but also the ones of acknowledgement, attention, acceptance, respect, status, trustworthiness, power, intimacy, love, friendship, kinship and sociability. While these social rewards may seem far fetched from an economic point of view, neuroimagery demonstrates that “our brains neurologically compute personal reputation to be as valuable as money”.[8]
It is worthwhile to notice that:“The real important game here is not economic, but one of status”.[9] Indeed in the forthcoming reputation-based economy, “it is not about your credit but your credibility”.[10] We are already mastering numbers and accounts, now what we need is a meaning. It is no surprise that 78 percent of the Millennial generation believe that companies have a responsibility for making a difference in the world.[10a] We believe that our social operating system needs to be upgraded to a new level of complexity in order to integrate these new qualitative dimensions as a way to ease social exchange.
It is worthwhile to notice that:“The real important game here is not economic, but one of status”.[9] Indeed in the forthcoming reputation-based economy, “it is not about your credit but your credibility”.[10] We are already mastering numbers and accounts, now what we need is a meaning. It is no surprise that 78 percent of the Millennial generation believe that companies have a responsibility for making a difference in the world.[10a] We believe that our social operating system needs to be upgraded to a new level of complexity in order to integrate these new qualitative dimensions as a way to ease social exchange.
To respond to these new challenges a societal evolution is at work and civil actors such as NGOs and GROs (grassroots organizations) are “geared to addressing and helping resolve social equity and accountability issues that traditional tribal, state, and market actors have tended to ignore or are now unsuited to addressing well”.[4] However, these organizations dedicated to the collective good are dependent on scarce money and have to compete against each other. New economic practices are required in order to access financial resources. And from the point of view of a monetary theorist: “History will probably see the period 2007-2020 as one of financial turmoil and gradual monetary breakdown. History has also shown that systemic changes in the monetary domain happen only after a crash. Therefore, the time to wake up to monetary issues is now”.[5]
MONEY IS YET ANOTHER INFORMATION SYSTEM
“In cashless systems [money] will become purely information which can be processed in many ways”.
Mervyn King, Governor of the Bank of England
Ultimately, money and reputation are information systems; the first one is designed to ease the distribution of wealth within society and the second one to come up with a valuable judgment about a person or a thing we don’t know yet. The real question to address is: how do we relate these information systems together and to the data supply we experience today?[11] A leading blogger on monetary innovation states: "My vision for the future of money is not really a vision of money at all. It is a vision of a future in which our systems of measuring and accounting for value evolve in ways that better correspond to the complexities of our interactions".[11a] Even from a more traditionalist point of view, "Banking is fundamentally application software on an intelligent network. There’s no question about it. […] But money is nothing but information".[12]
And we may sum up that money as an accounting system has been the mainstream reality since immemorial times.[13] Circa 4,000 BC and prior to the invention of writing, we find evidence that “Sumero-Akkadian lexicons […] list clay calculi among other bookkeeping devices”.[14] From then to now, money has been an information system and our challenge is to make good use of the data we possess. The “big data” analysis may be where a large chunk of the answer lies and in the words of Hal Varian, chief economist at Google, “I keep saying that the sexy job in the next 10 years will be statisticians. And I’m not kidding”.[15]
THE PURPOSE ECONOMY INSIDE AN ECOSYSTEM OF ECONOMIES
“You cannot change the context but you can decide how to act upon it”.
The purpose economy is about the intention of having a meaningful impact in the world. New exchange mechanisms that match the new social context still have to be defined. Next to the traditional market economy, we witness the emergence of Complementary Currency Systems (CCS), of the gift/sharing/collaborative economy and of commons-based peer production that we align here with what we coin as the relational and purpose-oriented economy.[15a]
Out of these realms, some are based on currencies, the market and CCS economies and some are currencyless, namely the gift/sharing/collaborative economy.[16] To put it briefly, payment systems are optimal in the first scenario and reciprocal exchange optimal in the latter. "Prices facilitate exchange when information is scarce and coordination difficult, conversely, reciprocal exchange has been preferred when trade involves a personal interaction, and when goods or services are unique, […] or have many dimension of quality".[17] Exchange protocols that recreate the missing link between the two are yet to be found. Initiatives such as the very promising Ethereum are a significant step in the good direction.[17a] We may notice that these collaborative and p2p economies are intertwined, often overlap and a strict separation does not apply.
Out of these realms, some are based on currencies, the market and CCS economies and some are currencyless, namely the gift/sharing/collaborative economy.[16] To put it briefly, payment systems are optimal in the first scenario and reciprocal exchange optimal in the latter. "Prices facilitate exchange when information is scarce and coordination difficult, conversely, reciprocal exchange has been preferred when trade involves a personal interaction, and when goods or services are unique, […] or have many dimension of quality".[17] Exchange protocols that recreate the missing link between the two are yet to be found. Initiatives such as the very promising Ethereum are a significant step in the good direction.[17a] We may notice that these collaborative and p2p economies are intertwined, often overlap and a strict separation does not apply.
Fig. 1. Wealth distribution mechanisms and related types of economies.
THE GIFT ECONOMY
"Exchange begins with a transfer, for which reciprocity is expected".
Marcel Mauss, Anthropologist
The exchange of goods and services without an explicit agreement for immediate or future rewards is called the gift economy. Within groups of high social cohesion, people use reciprocal exchange instead of using currencies.[18] “Reciprocity is the knowledge that the person would do the same for you, not necessarily that they will”.[19] No accounts are taken because with a personal relationship involved it would feel offensive or awkward to doing so. In fact, there is no way to even conceive a squaring of accounts. Instead, exchange is about the sentiment of equivalence which involves mutual expectations and responsibilities. As such, the gift is a manifestation of the demand for commitment as an end in itself and by perpetuating relations of perpetual indebtedness, it creates social fabric.
"Money becomes necessary when the range of our gifts must extend beyond the people we know personally. Such is the case when economic scale and the division of labor exceed the tribal or village level".[19a] As the gift economy establishes social relations, the market economy is the place for the exchange of utility. Debts and taxes have to be paid in legal tenders which are required by the authorities and which are the means of exchange of the market economy. As a result, the cooperative model of the gift economy is ultimately subdued to the tenets of the market economy which requires fierce competition between its users. Still, the gift economy is pervasive in all human affairs and “a recognition of our ultimate interdependence that is the ultimate substance of social peace”. [19b]
"Money becomes necessary when the range of our gifts must extend beyond the people we know personally. Such is the case when economic scale and the division of labor exceed the tribal or village level".[19a] As the gift economy establishes social relations, the market economy is the place for the exchange of utility. Debts and taxes have to be paid in legal tenders which are required by the authorities and which are the means of exchange of the market economy. As a result, the cooperative model of the gift economy is ultimately subdued to the tenets of the market economy which requires fierce competition between its users. Still, the gift economy is pervasive in all human affairs and “a recognition of our ultimate interdependence that is the ultimate substance of social peace”. [19b]
THE MARKET ECONOMY
“Life for him begins when this activity ceases”.
Karl Marx [19c]
The market economy is based on the concept of limitless growth. Limitless growth is the fantasy of economists, businesses and is sold by politicians as a measure of progress and the requirement for prosperity. In effect, this type of growth measures the conversion of nature into cash, and commons into commodities. Water available as a commons shared freely and protected by all provides for all. However, it does not create growth. But when Coca-Cola sets up a plant, mines the water and fills plastic bottles with it, the economy grows. This growth mirrored by the Gross Domestic Product is based on creating poverty – both for nature and local communities. GDP which is supposed to measure the wealth of nations, has emerged as both the most powerful number and dominant concept in our times. [19d] Because wealth concentration, unemployment and depletion of natural resources are part of the same equation, the market economy erodes social capital and the environment.
While the market economy has led to the rise of the industrial revolution, it now faces the change in values raised by a society that starts to understand the limits of an infinite use of finite resources. Fine tuned for processing large volumes of financial capital, the market economy is by design very brittle and prone to systemic crashes.[20] Indeed, the monopoly of compound interest based currencies make this type of economy unsustainable in the long run. While citizens demand sustainable prosperity, monetary policies required by the banking system imposes compulsory growth to governments as the only option to go forward.[21] As we face unprecedented challenges and the urge for optimism, a collective change in consciousness pours in as “We need to let go of an old body of institutionalized collective behavior in order to meet the presence of our highest future possibility”.[21a] It is to see to which extent the impersonal market economy remains compatible with the modernity project where both the search for a meaning and the human relationship are core requests of the economic exchanges. People are not disposable – the value of life lies outside economic development. GDP is no longer the only factor that determines wealth.
While the market economy has led to the rise of the industrial revolution, it now faces the change in values raised by a society that starts to understand the limits of an infinite use of finite resources. Fine tuned for processing large volumes of financial capital, the market economy is by design very brittle and prone to systemic crashes.[20] Indeed, the monopoly of compound interest based currencies make this type of economy unsustainable in the long run. While citizens demand sustainable prosperity, monetary policies required by the banking system imposes compulsory growth to governments as the only option to go forward.[21] As we face unprecedented challenges and the urge for optimism, a collective change in consciousness pours in as “We need to let go of an old body of institutionalized collective behavior in order to meet the presence of our highest future possibility”.[21a] It is to see to which extent the impersonal market economy remains compatible with the modernity project where both the search for a meaning and the human relationship are core requests of the economic exchanges. People are not disposable – the value of life lies outside economic development. GDP is no longer the only factor that determines wealth.
THE COMPLEMENTARY ECONOMY
Complementary Currency Systems (CCS) are an attempt to fix the lacks of the market economy by addressing societal needs left unfulfilled by political or economic powers. They do so by bridging the gap between unmet needs and underused resources with new means of exchange. These systems introduce ethics and a purpose to the economy. Nevertheless, CCS are anterior to the rise of social media and the relational component is not part of their design. In other words, "with the advent of networked computers [and data flows], we are growing out of limitations of tit-for-tat exchange based tokens (money) to keep track of the social contracts that lead to building value".[22]
As we speak about social technologies which enable to track and manage social relationships, there is a potential for achieving new forms of visibility and accountability which impact the economic exchange. It may also prove successful to scale up the levels of trust and cooperation within social and solidarity economy initiatives. A study about a community currency system in Argentina "[...] shows that scaling up is possible within the limits defined by the interpersonal transfer of trust, the reputation of the leaders to act as a linchpin for the system, and the ability to sustain the process of institutional innovation".[23] Being purpose oriented but not relational oriented, the complementary economy may be to the knowledge society what the craftsmanship economy was to the industrial society ; a forerunner. Local initiatives such as the Brixton Pound and business circles such as the Wir Bank [23a] can benefit from CCS but these are not the obvious contender to become mainstream within online communities unless they become an accepted means of payment for taxes. [23b]
Constraints about CCS that may restrain their adoption by social network users:
- Distributed governance is difficult to run on the sole base of collective intelligence without means of enforcement.
- CCS are in direct competition with the monopoly of money creation.[24]
- CCS are a concept difficult to grasp for the layman because it tackles hidden monetary mechanisms.
- CCS are by definition limited in scope and object and do not carry the ability to command all goods and services.
- CCS need trust but not too much otherwise we switch to a currencyless reciprocal exchange system.
- CCS are complementary not alternative means of payment which means they are not self-sufficient. CCS are eventually muted by legal tenders and mainstream currencies.
PRINCIPLES FOR A PURPOSE ECONOMY
“The next generation will have a hard time trying to understand what economics was to us”.
Sebastiano Scròfina
It is important to notice that the notion of economy is broader than the market economy conception and we understand it as value creation information systems. “As every language influences the way one thinks, currency influences the way one behaves. Mainstream currency is the most powerful and spoken language on our planet, and in the next decade it's going to be totally redefined by the Internet”.[25] The ground for non-monetary online exchange is made of trust, recognition, the potential of multilateral reciprocity and the sense of equivalence. In this new economy, we strive to create the capacity to connect with our opportunities and for the resource to flow in. While this economy is currencyless, capital still attracts capital ; human and social capital understood as publicly recognized strengths and qualities at the individual and collective levels act as attractors for financial capital. The desire for autonomy, mastery, and for contributing to a higher purpose are the strong motivators of this new economy where authenticity and being in the now are the rewarding strategic attitudes.
A RELATIONAL ECONOMY
“We can’t imagine entering the Information Age without changing the fundamental and most used communication tool: Money”.
Bernard Lietaer, Former central banker and monetary theorist
In contrast to the other types of economies the purpose economy - as we coin it - has the original combination of being relational, virtual[26] and global. The relationship is cardinal in this economy though economic agents are not related by blood nor kinship. This creates a whole new set of challenges to secure trust among peers who don’t know each other but who have common friends, passions and spheres of interest.[27] Reputation is a major constituent of trust and trust is transitive. The basic assumption is that trust can be propagated in some way and this is the reason why people trust their friends more than strangers. This argument is captured by the aphorism “we like to be friends with friends of our friends” and members whose friends are friends with one another tend to be more satisfied than those whose friends do not get along with one another.[28] Online trustworthiness derived from personal data made public will become a driver of upcoming economic exchanges. "Customers expect us [banks] not just to hold on to their data, but to come back to them with value added knowledge or relationship capital as well. These have become more important than they've ever been, and banks need to recognize these currencies beyond just financial capital. This requires a rediscovery of relationships that leads to a revolution of trust with customers". [28b]
TRUST NETWORKS
"By the end of this decade, power and influence will shift largely to those people with the best reputations and trust networks, from people with money and nominal power. […] It is time to go ahead of that curve”.
Craig Newmark, Opinion leader
Trust is a “relationship between individuals where the trustor expresses the will to rely on and lose control over the trustee”.[29] In this context, reputation plays a primary role in securing trust. Basically, we use reputation to make better decisions. A verified good reputation is the basis of trust and trust is a requirement for members to engage with confidence. “Reputation is about a promise, trust is about will it be delivered”.[30] The challenge for the trustor is therefore to create the best possible bet before engaging in a relationship between the fear of being betrayed, disappointed; emotionally, financially or even physically harmed and the hope of reaching a positive outcome. Good reputation and trustworthiness open doors, attract attention, raise influence, ease access to resources and professional growth and can provide unconditional support in times of crises.
- With so much horizontal distribution, externalizing trust to third parties is not always possible.
- Relational graphs composed of social circles (trusted networks) and recognized talents (trusted qualities) are the main components of online trust along authentication and conflict resolution mechanisms.
THE TWO SIDES OF ONLINE TRUST
“With so much user-interaction and user-generated content, trust becomes a critical issue”.
Jennifer Golbeck, Editor
On the individual side, by promoting their passion-driven activities and talents, users align on their values and are in tune with their core beliefs and motivations. They act from their highest place on what they intrinsically like to do and they do it for the sole sake of enjoying the process itself. As they don’t know where it goes, they rejoice the process of how it goes.
On the collective side, as positive attitudes have a chance to be publicly acknowledged, the general incentive is to build up one’s social profile by trying to bring the maximum perceived added value in the exchanges. Feedback loops and comments that can go viral and damage one’s social capital will prevent most of the misbehavior as users will strive for keeping their status healthy. Still a major threat remains. “[…] When we refer to a person's reputation, we recognize that reputation is our perception of the person, that it is externally derived and not necessarily intrinsic to that individual. In other words, we understand that a person may not have complete control over the perception that has been created”.[30a] This has significant consequences in the reliability you can ascribe to the system. By default − and next to social analytic and e-reputation monitoring − no information out there is trustworthy, only the one emanating from a trusted source may.
THE INDIVIDUAL SIDE AND SELF-CONFIDENCE
“If you don’t trust yourself, don’t expect people to trust you either”.
The state of flow[31] is chosen as the optimal strategy to achieve self-confidence which is a prerequisite for attaining good reputation and thus for generating trust. Per definition, there is low reliance on external reward other than recognition because the enjoyment lies in the process of being authentic and doing and sharing what we love to do. This has repercussion on the governance level because ─ aside little disappointment ─ there is not much grip for conflict to arise because trust is internalized in the “Self” or in the essential qualities that constitute a person's uniqueness or essential being not in a fuzzy expectation. Recognition secures self-esteem, confidence and respect by others. External recognition and feedback fine-tune self-alignment and clear up new paths for personal development and for serendipity and synchronicity to manifest.
By promoting passion-driven activities and talents, users align on their values and are in tune with own beliefs and motivations. They act from their highest place on what they intrinsically like to do and they do it for the sole sake of enjoying the process itself. They act with less expectations regarding the potential output and in the best case scenario they act without any expectation whatsoever. They have a taste of fulfillment while they make themselves inaccessible to unnecessary deception. “What is really changing in the world is not technology, or the globalization of capital, but the relationships between people, relationships that were once hierarchical and based on the force of authority. This has been radically flattened. What matters most now are the connections between people, the inter-dependencies and networks that can be formed and the unimpeded flow of information”.[44]
By promoting passion-driven activities and talents, users align on their values and are in tune with own beliefs and motivations. They act from their highest place on what they intrinsically like to do and they do it for the sole sake of enjoying the process itself. They act with less expectations regarding the potential output and in the best case scenario they act without any expectation whatsoever. They have a taste of fulfillment while they make themselves inaccessible to unnecessary deception. “What is really changing in the world is not technology, or the globalization of capital, but the relationships between people, relationships that were once hierarchical and based on the force of authority. This has been radically flattened. What matters most now are the connections between people, the inter-dependencies and networks that can be formed and the unimpeded flow of information”.[44]
THE COLLECTIVE SIDE AND REPUTATION
“[…] To be attended to, to be taken notice of with sympathy, complacency, and approbation, are all the advantages which we can propose to derive from it [regard]”.[32]
Adam Smith, Economist
Reputation is inescapable, pervasive and is a main constituent of trust which is transitive and the bedrock of economic exchange in any type of human organization system: tribes, institutions, markets or networks.[33] We understand reputation as “information used to make a value judgment about an object or a person we don’t know yet”.[34] We relate on reputation when we don't have first hand information and this is especially true online. Strangers generate reputation claims for other strangers with the belief that “collective opinion is better than ignorance”.
Reputation is made out of statements, both extrinsic and intrinsic. The strongest statement is when a person specifically receives recommendation from a higher trusted source because there is nothing like being anointed by people with authority. The less strong form of reputational statement is when a person explicitly argues in favor − or in disfavor ─ of a person, an object or some of their qualities. Comments, feedback loops and peer reviews are part of this latter form. Good reputation builds up on qualitative statements made in return of one’s actions and the general incentive is then good behavior while aiming at best practices.
SELF-GOVERNANCE AND THE RISE OF LEADINGSHIP
“Lead yourself, lead your superiors, lead your peers, employ good people and free them to do the same. All else is trivia”.[36]
Dee Hock, Visa founder
Leadership, facilitation and moderation are critical in any community. It is fair to think that online communities will link governance with attitudes, beliefs, self-alignment, stated intentions and good practices. New collective intelligence behaviors are nowadays fireproofed by social actors and we can reasonably guess that dynamic hierarchy and consent-based decision making will continue to gain importance. Fundamentally built as a smart-edge dumb-center[37] architecture the network structure will most certainly impact relational dynamics.[38] This will have consequences to governance.[39] “[Unlike leadership…] Leading-ship is predicated upon relationships between equals and peers, and interaction is carried out without position or rank”.[40]
Furthermore, in an economy of relationships, the “focus of the internet is not on the importance of the nodes but on the collective effects of the links between them”.[41] Therefore, we may expect a move from static hierarchy to dynamic stigmergy[42] where anyone is eligible to become a leader in his own field of expertise. As the trend is to self-organization and taking "response-ability", governance becomes a must that needs to be addressed in the first place. Governance offers a wide terrain for social experimentation with its inevitable lot of trials and errors. Neural networks, heterarchies, fractals, bioteaming, swarms and stigmergy are all examples of biomimetics that may underline the effort to cope with new governance processes in the network age.[43]
THE ROLE OF DATA IN THE RELATIONAL ECONOMY
“A person has no legitimate expectation of privacy in information he voluntarily turns over to third parties".[45]
Google Inc.
Google Inc.
In the digital world, data privacy is becoming a major concern to all of us as service providers collect, process and protect our personal information which may be used to identify us. In a data driven economy[46], social network users generate a digital footprint of personally identifiable pervasive information which ─ by "submitting" to the terms and agreements[47] − falls in the purse of the service provider. Data can be cloned, mirrored, duplicated ad libitum and stored on remote servers which may belong to multiple jurisdictions. Wearable computing, sensors, augmented reality, face tagging, cookies, geographic information systems, location history, gaze tracking techniques,[47b] "little data" and aggregates of granular information make users' life easier at a cost. On the hacking side, breaches in security, loopholes, accidental, unauthorized or unlawful access to personal data create the ground for the disclosure of personal information.[48] Next to these legal, technical and unlawful issues, the power of semantics seriously undermines the anonymization of data.[49] Furthermore, data generates more valuable metadata which escapes original ownership. Last but not least, cross-domain tracking and advances in data analysis − from descriptive to predictive modeling − make most of the data privacy concerns’ wishful thinking.[50]
“What scholars increasingly agree on is the fact that private vs. public cannot be seen as a dichotomy, but rather must be seen as a continuum influenced by numerous factors”.[51] Eventually, users will “[…] understand that almost all information put on the Internet must be considered public due to its persistence and mutability”.[52] Thus the real question is “who owns the means of analysis?” as it may “provide a tool for self-reflection at a time where the zeitgeist is one of self-promotion”.[53] And “[…] as it stimulates consumers curiosity around their interests, it will create a great opportunity for new players with alternative ways to deliver the Interest Graph […]. A whole new web has to be invented: the topic-centric social media”.[54]
If the industrial era was polarized between the ones who owned the means of production versus the ones who worked on them, the post-industrial era may be polarized between the ones who own the means of analysis and the others who don’t: the blue collars of the digital age.[54b] The primary concern would be to free the means of analysis to the users themselves as knowledge “never exists in concentrated or integrated form, but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess […] The economic challenge of society is thus a problem of how to secure the best use of resources known to any of the members of society, for ends whose relative importance only these individuals know. Or to put it briefly, it is a problem of the utilization of knowledge not given to anyone in its totality”.[55]
“Information is the oil of the 21st century, and analytics is the combustion engine”.
Peter Sondergaard[54a]
If the industrial era was polarized between the ones who owned the means of production versus the ones who worked on them, the post-industrial era may be polarized between the ones who own the means of analysis and the others who don’t: the blue collars of the digital age.[54b] The primary concern would be to free the means of analysis to the users themselves as knowledge “never exists in concentrated or integrated form, but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess […] The economic challenge of society is thus a problem of how to secure the best use of resources known to any of the members of society, for ends whose relative importance only these individuals know. Or to put it briefly, it is a problem of the utilization of knowledge not given to anyone in its totality”.[55]
FACTS AND FORECAST
• While online communities represent a huge pool of dormant talents, social impact remains liminal.
> Measuring and leveraging social impact will become a prominent task for future organizations.
• In an economy of relationships, impersonal market tenets are by definition irrelevant.
> New means of reciprocal exchange taking into account social distance and social recognition are emerging and will become prominent.
• In a globalized relational economy, new trust mechanisms have to be defined.
> Power and influence will shift to people with best reputation and trusted networks. Communities of practices with strong narratives based on shared values, meaning and purpose will take the lead.
• Data control and analysis will call for a necessary trade off in terms of privacy.
> Users wanting to be more strategic with their interactions, with a map to plan more effectively who they connect with will overtake those wanting to protect their privacy.
• Digital human interaction is part of a complex information system.
• Digital human interaction is part of a complex information system.
> Complexity doesn't have to be reduced to metrics, instead it can be projected on graphs.
• Like a financial crash, a data crash or global data mess is more tangible than a black swan event.
> In such contingency, e-reputation management won't suffice, trusted networks will be the "guerrilla pesos" or the equivalent to the "emergency circulating notes" of hardship times.
• Like a financial crash, a data crash or global data mess is more tangible than a black swan event.
> In such contingency, e-reputation management won't suffice, trusted networks will be the "guerrilla pesos" or the equivalent to the "emergency circulating notes" of hardship times.
CONCLUSION
When the human interaction is subject to a personal relationship, when information available is abundant and when the interaction has multiple dimensions of quality, reciprocal exchange is the norm. This is the case for the social media environment. Until now, reciprocal exchange was circumscribed to geographically bonded social groups. With the advent of the network age and the with the means of analysis we possess today, we believe this is about to change.
Next to the market economy, the gift/sharing economy and the complementary economy, there is room for a new type of relational economy specific to the social media context. This new economy aims to reveal and unleash the vast amount of latent resources such as knowledge and know-how that represent the biggest asset of online communities. So far, with the lack of a proper means of exchange, these online communities are close to a standstill in terms of collective action and social impact. It is time to scale up the process.
Next to the market economy, the gift/sharing economy and the complementary economy, there is room for a new type of relational economy specific to the social media context. This new economy aims to reveal and unleash the vast amount of latent resources such as knowledge and know-how that represent the biggest asset of online communities. So far, with the lack of a proper means of exchange, these online communities are close to a standstill in terms of collective action and social impact. It is time to scale up the process.
Based on authenticity and shared values, this new economy is designed to bring into the human exchange a meaning and thus a purpose.
Gaël Van Weyenbergh
Note: "The Purpose Economy" (http://purposeeconomy.com/) website and "The Purpose Economy: Lessons From The Front Lines Of The New Economy" book is a concomitant yet independent research lead by Aaron Hurst and people at Imperative.
CREDITS
While they may not fully endorse my views, I'm grateful to these people for the inspiring thoughts they provided: Marco Sachy, Dante-Gabryelle Monson, Leander Bindewald, Jean-Luc Roux, Bernard Lietaer, Michael Murray, people at the P2P Foundation, Metacurrency, Innotribe, ETH Zurich, UoM Dept of ICT and last but not least with Simon Ulvund, Hinnerk Hansen, The Hub Xchange group and The Hub community.
Some influential readings:
Adam Smith, "Theory of moral sentiments".
Friedrich. A. Hayek, "The use of knowledge in society".
Avner Offer, “Between the gift and the market: the economy of regard”.
Bernard A. Lietaer, "The Future of Money".
David Graeber, “Debt, the first 5,000 years”.
REFERENCES
[1] Which
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knowledge in society”, The American economic review, Vol. 35, num. 4, Sep 1945,
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This innovation conceptually creates new means of payment.
[6a] Big data technologies describe a new generation of technologies and architectures, designed to economically extract value from very large volumes of a wide variety of data, by enabling high-velocity capture, discovery, and/or analysis.
[6a] Big data technologies describe a new generation of technologies and architectures, designed to economically extract value from very large volumes of a wide variety of data, by enabling high-velocity capture, discovery, and/or analysis.
[7] From 17th Century. Circa 1530, economy is understood as "household management," from L. oeconomia, from Gk. Oikonomia
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[10a] The Center for Generational Studies, "Millenials and corporate responsibility", March 2012.
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[11a] Gregory Rader, The Future of Money – Asymmetric Accounting, On The Spiral, September 2010.
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[15a] Such as GPL based licences, http://p2pfoundation.net/Peer_Production
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[17a] Ethereum.org, "Ethereum can be used to codify, decentralize, secure and trade just about anything: voting, domain names, financial exchanges, crowdfunding, company governance, contracts and agreements of most kind, intellectual property, and even smart property thanks to hardware integration. Ethereum borrows the concept of decentralized consensus that makes bitcoin so resilient, yet makes it trivial to build on its foundation. To find out more about how Ethereum works, consult the white and yellow papers".
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[19] David Graeber, Op. Cit., p. 100.
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[19b] David Graeber, Op. Cit.
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[19d] Vandana Shiva, "How economic growth has become anti-life", The Guardian, 1st of November 2013.
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[19b] David Graeber, Op. Cit.
[19c] Karl Marx, "Wage labour and capital", 1847.
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[21a] Otto Scharmer, “Theory U: Leading from the Future as it Emerges”, Berrett-Koehler publishers, 2009.
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[23a] Respectively http://brixtonpound.org/ and http://www.wir.ch/
[23b] Bristol Pounds to be accepted for council tax payments - Bristol24-7, From: http://www.bristol247.com/2013/09/18/bristol-pounds-accepted-council-tax-payments-85136/
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[30a] Governor Sarah Bloom Raskin, "Reflections on Reputation and its Consequences" at the 2013 Banking Outlook Conference at the Federal Reserve Bank of Atlanta, Atlanta, Georgia, February 28, 2013.
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[54a] Gartner Symposium/IT xpo 2011.
[54b] Commodify Us: Our Data Our Terms, by Marc Garrett - 11/08/2013: "When we subscribe to Web 2.0 platforms such as Facebook we are at the mercy of the data brokers. These companies trade in people's personal data; information which is aggregated by monitoring user actions and interactions across social media".
[55] F. A. Hayek, “The use of knowledge in society”, The American Economic Review, Volume XXXV,
Number 4, September 1945, p. 519-520.
