By Chris Giotitsas and Alex Pazaitis.
There is much hype around circular and collaborative economies over the past few years. From Davos to the European Union, everyone is eager to grab a piece of the new mode of industrial development. But what lies beneath these grand narratives?
In this 3-part short series we attempt to critically review the current discussion on the circular and collaborative economy and provide insights from some alternative trajectories.
This short series based on a workshop on circular, collaborative and distributed production designed and facilitated by Chris Giotitsas and Alex Pazaitis on the occasion of the participation of OD&M project at the 83rd Florence International Handycraft Fair, on April 24, 2019 in Florence.
Part 1: On the circular economy.
The most widely known and basic definition for a circular economy (accepted even by the European Union) entails cycles of production, ranging from repair, to maintenance, to re-use, refurbishment, and last to recycling. For this conceptualization to work, products need to be designed to fit these cycles. Meaning that we need to rethink how we design and make things. For instance, a phone may be designed so that it can be more durable, easier to repair and easier to recycle. So far so good.
However, considering the production and distribution networks today, that would presumably take place on a global scale. A product would be produced in one place, then purchased on the other side of the planet, then repaired or refurbished and resold somewhere else entirely. Until ultimately it is recycled for material and entering the cycle all over again. The question here, then, is: who would do the repair/ refurbishment/ recycling on that scale? As it is currently conceptualized, it is the service provider or the manufacturer that does it. How? Would manufacturers have processing facilities all over the planet, or would the products be sent to their locations thus increasing energy consumption and pollution? Doesn’t this reverse the whole point of circularity related to sustainability?
Furthermore, how would manufacturers and service providers keep track of all these products? Apparently, it is with the help of the “Internet of Things”, by making products smart and trackable. But if we’re talking about a circular system of this complexity then this means that the “manufacturer” would need to have massive operational capacities and resources as well as tracking (or surveilling really) data to an alarming degree.
From a different perspective, if one looks at the EU reports on the issue of circular economies they will find assessments based on collected data and while there is plenty available on a state and municipal level (regarding, for instance, recycling) there is next to none when it comes to industry. That is hardly surprising. It is costs money to track and collect information and when there is no clear profit foreseen, then why would a private manufacturer do it? The idea is to incentivize industry to change their practices. Allow them to make money in a different, more sustainable way. But even then, why would they share data? And how would the protocols and processes of one huge manufacturer work with those of another. They are competitors after all and the profit of one signals the loss of another.
So, circularity without being open source, is not really circularity. By making it so, then it would ensure interoperability for start. Meaning the products of one manufacturer would work with those of another. Open licenses and standards for parts, tools, materials as well as the sharing of all relevant information would mean that the product of one manufacturer would be possible to be repaired or maintained by whomever locally. Their materials would also be easier to locate, distribute, and reuse. However, at least for now, this seems not to be the goal.
When it comes to the circular economy, we are attempting to apply a concept on a production system that is incompatible. And the attempts so far, seem either too small or they end up being co-opted to such a degree that they lose any transformative potential.
Part 2: On the Sharing Economy
As a global society, we are facing what could be understood as an existential dilemma with the sharing economy. As a phenomenon, the sharing economy has been increasingly gaining attention since -roughly- 2004, as it gets more and more share in the global markets. But sharing, as a practice, is not a new phenomenon. It has been present in communities since the dawn of human history. And, frankly, in our current form of economic organisation we have not always been very fond of it….
Those of us who have been old enough to witness a primitive type of audiovisual technology called “Digital Video Disc” (aka DVD), have often found ourselves irritated with -and simultaneously amused by- aggressive anti-piracy ads like this one. In all their ridiculousness, comparing a downloaded movie with car theft, what they were basically tackling was early forms of peer-to-peer file-sharing.
So what has happened in less than 10 years that made sharing (esp. over the internet) from a criminal activity to the whole “sharing is caring” story?
Apparently, the answer lies in some people making enormous amounts of money through sharing. A glimpse on the net worth of Mark Zuckerberg or the market value of tech start-ups like Uber or AirBnB nicely illustrate this. On the other hand, a closer look in their underlying infrastructures (and also their tax returns) shows that, despite profiting on sharing capacities, they are not equally interested in sharing themselves. So, to put it bluntly, what is interesting about sharing, is the sharing economy. What is less obvious is what it is about the economy that is of the interest of sharing.
In a broader view, the economy can be described as a system that caters for the production and distribution of the means necessary for our subsistence and well-being. In the specific kind of economic system we broadly refer to as capitalism, economic affairs usually involve two main institutions: (a) private property; and (b) market exchange. The latter is fundamentally dependent on the former, and, respectively, the former rationalises the latter. This line of economic understanding also by and large underpins the definition of the sharing (or collaborative) economy from the European Union (European Commission (2016). A European Agenda for the Collaborative Economy. Available):
“[…] the term “collaborative economy” refers to business models where activities are facilitated by collaborative platforms that create an open marketplace for the temporary usage of goods or services often provided by private individuals”
And further it is pointed out:
“Collaborative economy transactions generally do not involve a change of ownership and can be carried out for profit or not-for-profit”
More or less, the understanding of sharing on behalf of the EU is reduced to the extent it can relate to these fundamental institutions of property and exchange. The focus is then placed on regulating issues evolving around these relations, concerning both things and people, including labour, liability and taxation.
Nevertheless, the same document still cannot move away from pointing out -even if in a footnote- a certain element that is significantly different:
“Collaborative economy services may involve some transfer of ownership of intellectual property […]”
And I would add a hint: often without conventional market-based transactions. Earlier examinations of the phenomenon focus exactly on this dynamic, explaining those conditions that allow them to have massive economic impact. Harvard Law Professor, Yochai Benkler, more than a decade before the EU became interested in the sharing economy (Benkler, Y. 2004. Sharing Nicely: On Shareable Goods and the Emergence of Sharing as a Form of Economic Production. The Yale Law Journal, 114(2): 273-358), eloquently argues on sharing as a form of economic production and nicely summarises his position as follows (again in a footnote, yet for different reasons here):
“I am concerned with the production of things and actions/services valued materially, throughnon-market mechanisms of social sharing […]”
And then continues:
“Sharing’, then, offers a less freighted name for evaluating mechanisms of social-relations-based economic production”
The phrase “valued materially” concerns the real value of sharing, not the one expressed in financial markets or the balance sheets of Facebook’s partner advertising companies. It relates to the very human interaction of sharing stuff and our own time and capacities in things we consider meaningful, from food, shelter and rides, to knowledge, information and technology. The meaning, or value, of this interaction, contrary to the so-called sharing economy, is not guided by price signals between the people, commodities and services. It is a form of an economy, i.e. a system catering for human subsistence and well-being, based solely on social relations. And this is partly why a Harvard professor has to come up with a “less freighted name” for it, as we can all imagine the all-too-freighted name of it that any Fox News anchor would instinctively shout out based on the above definition alone.
And here lies the real transformative dynamic of sharing as a form of economic production. It is this element that allows a group of uncoordinated software developers create better a web-server than Microsoft; or thousands of people, contributing their knowledge with no predefined structure, roles or economic incentives, create a digital encyclopedia that outgrows Britannica. But such sharing-enabled success stories typically don’t mobilise huge cash flows and don’t create “added value”, which basically entails an understanding of value stemming exclusively from selling stuff to people.
Going back to our existential issues with sharing, our general position as societies is that we basically think of sharing as a nice thing to do, but lack the institutions to really appreciate its value for our economic system. This massively restrains the actual dynamics of sharing, which are gradually subsumed by the dominant private-property-and-market-driven system.
There are of course great alternatives in the digital economy alone that build on this sharing capacity in a more humane and socially-minded way, from early neighbourhood tools and rides sharing platforms, to Free and Open Source Software, open design projects and Wikipedia. There is frankly as much sharing taking place on Facebook as in Wikipedia, at least on the front end. But the underlying value models and, subsequently, potential outcomes for the majority of the people involved are vastly different.
For this we need to finally mature with regards to our issues with sharing and, eventually, make a choice for the kind of sharing for which we would design our institutions and societies. And hopefully that would be the one that would help us escape the current dead ends on the social and ecological front.
Part 3: Needs-based design as an alternative paradigm
Despite the serious conceptual and systemic problems described in the previous parts of this short series, it does not necessarily mean that there are no examples of true implementation for collaborative and circular practices right now. In fact, there are several technological development communities that make it happen to some significant degree. More specifically, needs-based design and grassroots innovation as community-driven endeavours offer a serious alternative paradigm.
In other words, communities can harness these ICT-enabled capabilities to collaboratively create technology for themselves, and promote sustainable practices based on shared values, knowledge and infrastructure. For instance, small-scale farmers in the agricultural communities of L’atelier paysan and Farm Hack, collaborate to produce tools and machines, often from recycled scrap material, suitable for their type of agriculture, which conventional market channels often fail to adequately cover.
Yet, this type of self-construction activity is limited in simpler, frugal solutions, whereas to address today’s challenges we need a broader engagement of design and engineering. But for a community to create complex technologies and systems, advanced skills still need to be employed, including designers, engineers and software developers. The main difference is the type of relationship they have with the community of users. This means the experts would act according to their own motives for engagement but with an explicit purpose to provide a solution which best serves the users of the technology.
As far as the users are concerned, designers take up a specific purpose. They serve the role of guides or “Sherpas” (with reference to the ethnic group of the Himalayas that are expert mountaineers helping other groups). In that sense, the design process begins after a need within a community is made explicit. Then the designer meets with the community several times to discuss the parameters of the problem that needs solving and uses her expertise to design the solution, which is then reviewed by the community. This is an iterative process until a final artefact is produced, often through a collective process.
Nevertheless, engaging in such a creative activity and simultaneously making a living out of its is no easy task, yet it is better than the alternative. Having a community as a base of support beats deciding to engage in “social innovation” on your own. At least if we are defining social innovation as something that you make for the common good rather than a thing to make money out of. For instance, designers in the agricultural communities mentioned above, could receive funds to help farmers refurbish or redesign an existing tool, or they could crowdfund within the community for the creation of a new tool.
Such hybrid and radical models may lead to some sustainability for the designer willing to engage in social production. In our view however, for these terms to be genuinely meaningful in terms of sustainability, openness and equity, structural changes need to take place starting from a policy level. These communities provide a certain blueprint to inform the direction which needs to be taken.
For instance, instead of incentives for manufacturers, perhaps more focus could be placed in empowering communities to tackle parts of the extremely complex problems of circular production. Likewise, user-communities can harness favourable licences and legal tools to build on shared capacities for collaborative forms of production and distribution. Individuals like designers could also be given incentives and support to engage with these communities in a relationship that is not profit-driven but informed by mutually shared values.
What this would look like may take many forms, especially depending on local cultures and social contexts. For instance, such a community in the US, which generally lacks serious welfare structures, means that farmers need to rely largely on themselves and each other. Designers that work with them, manage to secure limited funding through the national agriculture organisations and donors while doing also something else to secure their personal sustainability. A similar community in Europe, on the other hand, which still manages to maintain basic social welfare amidst austerity obsessions, means that designers and engineers working with the farmers can secure state funding. So the volume of the work, as well as the quality of tools and documentation can be significantly increased.
In conclusion, collaborative and circular economies are possible. But we need, as a society, to engage with these ideas in more radical ways than it is happening at the moment.