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Interestingly, however, there is one last bastion of economic activity that proved remarkably resistant to the triumph of the market: firms, companies and, later, corporations. Think about it: market-societies, or capitalism, are synonymous with firms, companies, corporations. And yet, quite paradoxically, firms can be thought of as market-free zones. Within their realm, firms (like societies) allocate scarce resources (between different productive activities and processes). Nevertheless they do so by means of some non-price, more often than not hierarchical, mechanism!

they are the last remaining vestiges of pre-capitalist organisation within… capitalism

The miracle of the market, according to Hayek, was that it managed to signal to each what activity is best for herself and for society as a whole without first aggregating all the disparate and local pieces of knowledge that lived in the minds and subconscious of each consumer, each designer, each producer. How does this signalling happen? Hayek’s answer (borrowed from Smith) was devastatingly simple: through the movement of prices

The idea of spontaneous order comes from the Scottish Enlightenment, and in particular David Hume who, famously, argued against Thomas Hobbes’ assumption that, without some Leviathan ruling over us (keeping us “all in awe”), we would end up in a hideous State of Nature in which life would be “nasty, brutish and short”

Hume’s counter-argument was that, in the absence of a system of centralised command, conventions emerge that minimise conflict and organise social activities (including production) in a manner that is most conducive to the Good Life

Hayek’s argument was predicated upon the premise that knowledge is always ‘local’ and all attempts to aggregate it are bound to fail. The world, in his eyes, is too complex for its essence to be distilled in some central node; e.g. the state.

The idea here is that, through this ever-evolving process, people’s capacities, talents and ideas are given the best chance possible to develop and produce synergies that promote the Common Good. It is as if an invisible hand guides Valve’s individual members to decisions that both unleash each person’s potential and serve the company’s collective interest (which does not necessarily coincide with profit maximisation).

Valve differs in that it insists that its employees allocate 100% of their time on projects of their choosing

In contrast, Smith and Hayek concentrate their analysis on a single passion: the passion for profit-making

Hume also believed in a variety of signals, as opposed to Hayek’s exclusive reliance on price signalling

One which, instead of price signals, is based on the signals Valve employees emit to one another by selecting how to allocate their labour time, a decision that is bound up with where to wheel their tables to (i.e. whom to work with and on what)

He pointed out simply and convincingly that the cost of subcontracting a good or service, through some market, may be much larger than the cost of producing that good or service internally. He attributed this difference to transactions costs and explained that they were due to the costs of bargaining (with contractors), of enforcing incomplete contracts (whose incompleteness is due to the fact that some activities and qualities cannot be fully described in a written contract), of imperfect monitoring and asymmetrically distributed information, of keeping trade secrets… secret, etc. In short, contractual obligations can never be perfectly stipulated or enforced, especially when information is scarce and unequally distributed, and this gives rise to transaction costs which can become debilitating unless joint production takes place within the hierarchically structured firm. Optimal corporation size corresponds, in Coase’s scheme of things, to a ‘point’ where the net marginal cost of contracting out a service or good (including transaction costs) tends to zero 

As Coase et al explained in the previous section, the whole point about a corporation is that its internal organisation cannot turn on price signals (for if it could, it would not exist as a corporation but would, instead, contract out all the goods and services internally produced)

Each employee chooses (a) her partners (or team with which she wants to work) and (b) how much time she wants to devote to various competing projects. In making this decision, each Valve employee takes into account not only the attractiveness of projects and teams competing for their time but, also, the decisions of others.

Hume thought that humans are prone to all sorts of incommensurable passions (e.g. the passion for a video game, the passion for chocolate, the passion for social justice) the pursuit of which leads to many different types of conventions that, eventually, make up our jointly produced spontaneous order

Valve is, at least in one way, more radical than a traditional co-operative firm. Co-ops are companies whose ownership is shared equally among its members. Nonetheless, co-ops are usually hierarchical organisations. Democratic perhaps, but hierarchical nonetheless. Managers may be selected through some democratic or consultative process involving members but, once selected, they delegate and command their ‘underlings’ in a manner not at all dissimilar to a standard corporation. At Valve, by contrast, each person manages herself while teams operate on the basis of voluntarism, with collective activities regulated and coordinated spontaneously via the operations of the time allocation-based spontaneous order mechanism described above.

In contrast, co-ops and Valve feature peer-based systems for determining the distribution of a firm’s surplus among employees.

There is one important aspect of Valve that I did not focus on: the link between its horizontal management structure and its ‘vertical’ ownership structure. Valve is a private company owned mostly by few individuals. In that sense, it is an enlightened oligarchy: an oligarchy in that it is owned by a few and enlightened in that those few are not using their property rights to boss people around. The question arises: what happens to the alternative spontaneous order within Valve if some or all of the owners decide to sell up?

The consumer electronics company Plantronics, for example, knowing that on any given day 40% of its workforce will be working elsewhere, designed its corporate campus to only 60% capacity

Their joint enterprise, NextSpace, became their first venture into what they call “coworking,” or the creation of “shared collaborative workspaces.”

also nurtures what the authors call “managed serendipity” — ad hoc collaboration between people with diverging but complementary skills

the number of coworking spaces worldwide has shot up from 30 in 2006 to 1,130 in 2011

someone needs to keep an eye on the big picture, to “connect the dots.”

workspaces are designed on a flexible, on-demand and as-needed basis

Coonerty and Neuner found that the most productive collaborations tended to pair highly specialized experts with big-picture thinkers

they were struck by the number of entrepreneurs and freelancers working at coffee shops in the area

Business Talent Group

Clients get the specialized help they need at a cost below that of a full-time employee or traditional consulting firm, and specialists are well compensated and rewarded with flexible schedules and a greater degree of choice about which projects to take.

This has produced a new market dynamic in which the headhunter of yesteryear has been replaced by “talent brokers” who connect highly specialized talent with companies on a project-by-project basis

Matthew Mullenweg, doesn’t have much faith in traditional office buildings or corporate campuses: “I would argue that most offices are full of people not working.”

On the other hand, Mullenweg is a big believer in face-to-face collaboration and brainstorming, and flies his teams all over the globe to do so.

He also set up an informal workspace in San Francisco called the Lounge

Additionally, a 2010 Kauffman-Rand study worried that employer-based health insurance, by discouraging risk-taking, will be an ongoing drag on entrepreneurship

the problem of payroll taxes for freelancers

up to 44% of independent workers encounter difficulty getting paid fully for their work

"All texts published in Situationist International may be freely reproduced, translated and edited, even without crediting the original source."

The website of the creative commons makes the following statement about it's purpose: "Creative Commons defines the spectrum of possibilities between full copyright -- all rights reserved -- and the public domain -- no rights reserved. Our licenses help you keep your copyright while inviting certain uses of your work -- a 'some rights reserved' copyright."

The website of the creative commons makes the following statement about it's purpose: "Creative Commons defines the spectrum of possibilities between full copyright -- all rights reserved -- and the public domain -- no rights reserved. Our licenses help you keep your copyright while inviting certain uses of your work -- a 'some rights reserved' copyright."

Or more specifically, who is a position to convert the use-value available in the "commons" into the exchange-value needed to acquire essential subsistence or accumulate wealth?

All texts published in Situationist International may be freely reproduced, translated and edited, even without crediting the original source

The point of the above is clear, the Creative Commons, is to help "you" (the "Producer") to keep control of "your" work. The right of the "consumer" is not mentioned, neither is the division of "producer" and "consumer" disputed.

Creative "Commons" is thus really an Anti-Commons, serving to legitimise, rather than deny, Producer-control and serving to enforce, rather than do away with, the distinction between producer and consumer

specifically providing a framework then, for "producers" to deny "consumers" the right to either create use-value or material exchange-value of the "common" stock of value in the Creative "Commons" in their own cultural production

Thus, the very problem presented by Lawrence Lessig, the problem of Producer-control, is not in anyway solved by the presented solution, the Creative Commons, so long as the producer has the exclusive right to chose the level of freedom to grant the consumer, a right which Lessig has always maintained support for

The Free Software foundation, publishers of the GPL, take a very different approach in their definition of "free," insisting on the "four freedoms:" The Freedom to use, the freedom to study, the freedom to share, and the freedom to modify.

The website of the creative commons makes the following statement about it's purpose: "Creative Commons defines the spectrum of possibilities between full copyright -- all rights reserved -- and the public domain -- no rights reserved. Our licenses help you keep your copyright while inviting certain uses of your work -- a 'some rights reserved' copyright

In all these cases what is evident is that the freedom being insisted upon is the freedom of the consumer to use and produce, not the "freedom" of the producer to control.

Moreover, proponents of free cultural must be firm in denying the right of Producer-control and denying the enforcement of distinction between producer and consumer

where a class-less community of workers ("peers") produce collaboratively within a property-less ("commons-based") society

Clearly, even Marx would agree that the ideal of Communism was commons-based peer production

the property in the commons is entirely non-rivalrous property

The use-value of this information commons is fantastic

However, if commons-based peer-production is limited exclusively to a commons made of digital property with virtual no reproduction costs then how can the use-value produced be translated into exchange-value?

Further, unless it can be converted into exchange-value, how can the peer producers be able to acquire the material needs for their own subsistence

The root of the problem of poverty does not lay in a lack of culture or information

but of direct exploitation of the producing class by the property owning classes

The source of poverty is not reproduction costs, but rather extracted economic rents, forcing the producers to accept less than the full product of their labour as their wage by denying them independent access to the means of production

So long as commons-based peer-production is applied narrowly to only an information commons, while the capitalist mode of production still dominates the production of material wealth, owners of material property, namely land and capital, will continue to capture the marginal wealth created as a result of the productivity of the information commons.

Whatever exchange value is derived from the information commons will always be captured by owners of real property, which lays outside the commons.

For Social Production to have any effect on general material wealth it has to operate within the context of a total system of goods and services, where the physical means of production and the virtual means of production are both available in the commons for peer production

For free cultural to create a valuable common stock it must destroy the privilege of the producer to control the common stock, and for this common stock to increase the real material wealth of peer producers, the commons must include real property, not just information

Sure, in the old inefficient socialist states like the Soviet Union, where employment was considered both a right and a sacred duty, the system made up as many jobs as they had to (this is why in Soviet department stores it took three clerks to sell a piece of meat)

working 40 or even 50 hour weeks on paper, but effectively working 15 hours just as Keynes predicted, since the rest of their time is spent organising or attending motivational seminars

The ruling class has figured out that a happy and productive population with free time on their hands is a mortal danger

The answer clearly isn’t economic: it’s moral and political

And, on the other hand, the feeling that work is a moral value in itself, and that anyone not willing to submit themselves to some kind of intense work discipline for most of their waking hours deserves nothing, is extraordinarily convenient for them

Hell is a collection of individuals who are spending the bulk of their time working on a task they don’t like and are not especially good at

they all become so obsessed with resentment at the thought that some of their co-workers might be spending more time making cabinets

It’s not entirely clear how humanity would suffer were all private equity CEOs, lobbyists, PR researchers, actuaries, telemarketers, bailiffs or legal consultants to similarly vanish. (Many suspect it might markedly improve.)

plagued with debts and a newborn daughter, ended up, as he put it, “taking the default choice of so many directionless folk: law school

Now he’s a corporate lawyer working in a prominent New York firm. He was the first to admit that his job was utterly meaningless, contributed nothing to the world, and, in his own estimation, should not really exist

I would not presume to tell someone who is convinced they are making a meaningful contribution to the world that, really, they are not. But what about those people who are themselves convinced their jobs are meaningless?

(Answer: if 1% of the population controls most of the disposable wealth, what we call “the market” reflects what they think is useful or important, not anybody else.)

should you meet them at parties and admit that you do something that might be considered interesting (an anthropologist, for example), will want to avoid even discussing their line of work entirely

This is a profound psychological violence here. How can one even begin to speak of dignity in labour when one secretly feels one’s job should not exist?

Yet it is the peculiar genius of our society that its rulers have figured out a way, as in the case of the fish-fryers, to ensure that rage is directed precisely against those who actually do get to do meaningful work

in our society, there seems a general rule that, the more obviously one’s work benefits other people, the less one is likely to be paid for it

There’s a lot of questions one could ask here, starting with, what does it say about our society that it seems to generate an extremely limited demand for talented poet-musicians, but an apparently infinite demand for specialists in corporate law?

Even more perverse, there seems to be a broad sense that this is the way things should b

You can see it when tabloids whip up resentment against tube workers for paralysing London during contract disputes: the very fact that tube workers can paralyse London shows that their work is actually necessary, but this seems to be precisely what annoys people

It’s even clearer in the US, where Republicans have had remarkable success mobilizing resentment against school teachers, or auto workers (and not, significantly, against the school administrators or auto industry managers who actually cause the problems)

It’s as if they are being told “but you get to teach children! Or make cars! You get to have real jobs! And on top of that you have the nerve to also expect middle-class pensions and health care?”

If someone had designed a work regime perfectly suited to maintaining the power of finance capital, it’s hard to see how they could have done a better job

The remainder are divided between a terrorised stratum of the – universally reviled – unemployed and a larger stratum who are basically paid to do nothing, in positions designed to make them identify with the perspectives and sensibilities of the ruling class (managers, administrators, etc) – and particularly its financial avatars – but, at the same time, foster a simmering resentment against anyone whose work has clear and undeniable social value