Saturday, January 26, 2013

Is a cooperative, capitalistic society a de facto partial realization of a socialistic ideal?

Other titles considered for this post:

  • What's one man's treasure, is another man's rental.
  • Something borrowed . . .
I've written about sharing before. I've also mentioned 3-D printing, which seems to have the promise of shifting cost curves down by several orders of magnitude. But we should consider an opposing force that rather than increasing the quantity of tools (capital goods) and toys (consumption goods) increases the productivity of existing tools and toys--the "share economy".

Megan McArdle writing in the Daily Beast points to a Forbes piece that reveals just prolific sharing may become with new technological advances. The company profiled is AirBnB, and it serves as a good proxy for the many companies and changes this sharing economy could bring. Like any paradigm shift this substantial, technology alone won't get us there; culture changes probably will need to play a role as well. Regardless, the potential implications seem tremendous.

For example, also writing in Forbes, Chunka Mui has a series on how Google's driverless car technology could have trillion dollar impacts relatively soon--creative destruction writ larger than we've seen it in some time. If he is even partially correct, this will be a change to the auto industry (and many other industries as well) very comparable to what the advent of the auto industry did to buggy whips (and horse-drawn carriages, of course). 

Now to relate this to the chosen title for this post. Part of the socialist ideal is a society where ownership does not preclude use or sharing. If my neighbor has a tool, I too can have a tool if I need one. Part of the problem for realizing the socialist ideal is that ownership is fairly essential for orderly allocation of resources. It is a practically necessary condition and definitely a sufficient condition for solving the Calculation Problem-assuming a price system evolves out of ownership. Capitalism, perhaps more appropriately free markets, has always been the best means of achieving the goals of more and more for everyone and continually optimizing resource allocation. Here again we see a major step toward realizing those goals. 

The debate between socialism and capitalism is very much mostly not an argument about desirable ends but rather an argument about practical (largely) and principled (less so) means. Capitalism has always been saying, "I have some, and you can have some too." Socialism on the other hand has always been saying, "I ain't got nothing, but you can always have half!"