The role of the market in a Peer to Peer Society

Following the relational typology of Alan Page Fiske http://www.p2pfoundation.net/Relational_Model_Typology_-_Fiske, there are four intersubjective modes which have existed cross-culturally and historically: equality matching (gift economy), authority ranking (feudal-type structures), market pricing, and communal shareholding (according to us: P2P). Societies have always been a mix, but it can be argued that historically we have seen a succession of dominant forms: the gift economy in the tribal era, authority ranking in feudalism, market pricing in capitalism, and my hypothesis is that communal shareholding forms may dominate in a future ‘P2P-oriented era’.

But if they have always co-existed, it may be illusory to aim for a stateless and marketless society, rather, we should expect states and markets to continue to exist in some form or other, but informed and trans-formed by P2P principles. A current example is fair trade, a form of market that aims to become independent of pure power relations by negotiating with both producers and consumers. I consider the new forms of social entrepreneurship, and even base of the pyramid approaches of inclusional capitalism, to be part of that general trend, whereby market forms are starting to be informed and transformed by the partnership principle (of course, in the current context, subsumed to various degree to the dominant economic logic still).

The open questions is therefore: can we have markets without the unsustainability of the capitalist format and its attendent biospheric destruction and social and psychic dislocation?

In our wiki, we discuss some proposals related to non-capitalist markets, for examples the approaches of Eric Olin Wright, and the very concrete proposals by Kevin Carson (see also here)

Perhaps one thing we can do is learn from pre-capitalist markets?

This is why I find the following passage by Robert Brenner so interesting, because it explains the different place of the market in the non-capitalist forms of society that preceded ours.

Mute summarizes Brenner’s position:

Exchange-based production existed in many pre-capitalist societies before taking root in early modern Europe.Because pre-capitalist societies are fundamentally agrarian, both exploiters and direct producers have access to their own means of subsistence. ‘As a result’, writes Brenner,

their survival and reproduction is not dependent on the sale of their products on the market; consequently they do not have to compete in terms of productive powers.

Under these conditions, ‘the market exerts no pressure toward the continual revolution of the means of production’. According to Brenner, ‘[t]he increase of relative surplus labor cannot become a systematic feature of such modes of production’. Brenner also notes that there is a bias in pre-capitalist societies toward the realisation of ‘absolute’, as opposed to ‘relative’, surplus value. Because labour is compulsory for serfs and slaves, lords and masters tend to extract additional surplus labour by lengthening the working day or extending the corvée, rather than through technological innovation. As a result, there is little reason to invest profits in the development of productive forces. ‘Rather than being accumulated, economic surplus is here systematically diverted from reproduction to unreproductive labor’.

Brenner, following Marx, argues that capitalism emerges only when labourers are both free to sell their labour power on the market as a commodity, and compelled to do so in order to survive.”

So at the very least, we can see that markets have existed, and can exist, but subsumed to another dominant economic model, which is an important point to prove. Of course, as pointed out by Brenner, in a feudal model, its benefits will be used largely by the dominant class in that system.

A market in a peer to peer society would of course have to be beneficial first of all to the peer producers themselves.

We do not really have a model for this, apart from peer-arbitraged fair trade, which benefits cooperative producers (and not peer producers), but the Linux economy shows us the emergent practice of benefit sharing, i.e. companies that benefit from the peer producing commons give back to it by sustaining the infrastructure of cooperation for that peer production to occur. This is good as far as it goes, as it does not by itself put an end to the biospheric destruction mechanism caused by the infinite growth mechanism that is contemporary capitalism. So much more thinking and practice is needed, i.e. the practical development of alternative ecologies of exchange, for such non-capitalist markets to emerge.

Resources on transforming markets:

– Market, http://www.p2pfoundation.net/Market (and its equity aspects)

– Markets without capitalism, http://www.p2pfoundation.net/Markets_without_Capitalism

– Non-capitalist markets, http://www.p2pfoundation.net/Non-capitalist_Markets (and the view of Gesell)

– Reforming Markets, http://www.p2pfoundation.net/Reforming_Markets

– Market Socialism, http://www.p2pfoundation.net/Market_Socialism and Self-managed market socialism

– Market aspects of open source, http://www.p2pfoundation.net/Open_Source_-_Market_Aspects

– Open Market, http://www.p2pfoundation.net/Open_Market

– Market 3.0, http://www.p2pfoundation.net/Market_3.0

Resources on transforming capitalism:

– P2P Capitalism, http://www.p2pfoundation.net/P2P_Capitalism

– Cooperative Capitalism, http://www.p2pfoundation.net/Cooperative_Capitalism

– Natural Capitalism, http://www.p2pfoundation.net/Natural_Capitalism

– Capitalism 3.0, http://www.p2pfoundation.net/Capitalism_3.0

– Open Capital, http://www.p2pfoundation.net/Open_Capital (and the Open Capitalist Project)

Patient, cooperative, and good capital

5 Comments The role of the market in a Peer to Peer Society

  1. Stefan Meretz

    You (following Brenner) described markets in a pre-capitalist C-M-C (C: commodity, M: money) society, where any immanent “pressure toward the continual revolution of the means of production” did not exist. Ok. Then, in capitalism you have the dominant M-C-M’ mode, where making more money from invested money is the goal, which every player have to follow. And now, you are thinking of going backwards to a nice C-M-C-society? Did I understand you right this way? In my view, nothing is more unrealistic than that.

  2. Franz Nahrada

    Markets have traditionally existed at the borders of communities, mediating relations to remote sources of indespensible or luxurious goods.

    Its imagineable that in local communities there is an arrangement similar to moral economies of the past, but on a much more developed scale: to mutually complement each others needs by a “virtual cycle” of producers or producing communities. Such an arrangement could be built on the decentralized powers of production and automation and a keen material resource flow scheme similar to natural biotopes.

    It seems much more difficult to close such cycles on a large scale; so maybe for a long time external markets coexist with “local communisms”. The productivity disadvantage that made such “local communisms” obsolete in earlier times is gradually disappearing.

  3. Michel Bauwens

    Stefan,

    I do not think that you understand the purpose of accepting the existence of non-capitalist markets.

    My approach is based on the following theses:

    1) that the present form of markets, which destroys the underlying biosphere, is not sustainable in the long run. In other words: infinite accumulation of capital resources, through production that does not take into account any exernalities, is doomed to either self-destruction or transformation

    2) that non-capitalist and non-accumulative market forms have existed for thousands of years; however, because it existed in the context of other exploitative social forms, I do not wish for a romantic return to it, if that is the sense that you intent to convey

    3) since we need a form to deal with the production and distribution of rival goods; since I do not see many alternatives at present; but since I rather see the emergence of new market formats that are subsumed to other primary partnership based logics (see fair trade, social entrepreneurship and BOP approaches); and since I do not have, nor wish to have the coercive power that would prohibit people from trading their production, I see no alternative than to accept such market forms

    4) but again, such a market form for rival goods, co-exist and is subsumed to the peer to peer logic of immaterial production, which is the primary structure of the type of society I expect to see evolve in the future

    5) in the context of post-capitalist and with a post-capitalist state, I then expect to see many more social experiments in a pluralistic economy, some of which would choose non-market forms, and may prove more productive than those market forms

    At present, that is speculative.

    Michel

  4. Patrick Anderson

    Stefan,

    I do not agree with the assertion that every player (every human on earth?) must follow the destructive goal of “making more money from invested money”.

    There are many micro-economies (such as in families or maybe in some small communes) where action is taken (work) for the sole purpose of PRODUCT, not for PROFIT.

    But if you think none of us can ever escape such a fate, then why even try to promote the http://Oekonux.org ideals? If we are destined to lose, then why try?

    I don’t understand. If no player (human) can ever possibly do anything beyond being a Capitalist pawn, then shouldn’t we just give up now?

    Sincerely,
    Patrick

  5. Mark Rego-Monteiro

    Fascinating, Michel. I am still getting acquainted with economic terminologies and concepts, now in a related Master’s program from a background in biology, social services, and activism. I agree strongly with what I understand to be your perception that the current system is so powerful that large-scale, fundamentally coerced change is not desirable.
    A fundamental issue I perceive is the abundance of natural resources, and the gap between the invented and reified currency accouting systems and the ecosystem limitations. Nevertheless, it is a dynamic recognizable in examples like Newfoundland where the Cod population crashed. Essentially no Cod, fishermen with limited voyage technology and resources had no choice but to stop fishing. I understand that retraining took place. I don’t know what the current status of the Cod population is there, but I have not heard that they have rebounded. A larger perspective is provided by the U.N. group 2005 Millenium Ecosystem Assessment, which describes 60 percent of studied areas as already used beyond restorative capacity. I believe the ecological concept is the “replacement rate.” Another dimension is captured by the Stockholm Treaty on Persistent Organic Pollutants from the last ten years. As described by the Center for International Environmental Law, it bans twelve chemicals, and is part of a broader international arrangement involving a Chemicals Management system. Perhaps this can be termed “chemical emissions and biochemical interference”.
    The dimension you refer to represented by fair trade is a vigorous effort in the direction of a peer to peer system, I agree. In attempting to understand the socio-cultural axes in this realm, perhaps it can also be helpful to refer to the examples of Science Applications International and St. Luke’s Advertising, both being high-revenue employee-owned companies and conceivably cooperative partnersips, with the former also a high-technology firm. I have no knowledge of their relationship to environmental sustainability. Interface Carpets is a manufacturing multinational corporation, however, that has made an outright commitment to ending any toxic environmental impact, and achieving a restorative impact. Another useful example exists in Equal Exchange, a company that has achieved significant success as an employee-owned cooperative partnership, also engaged in Fair Trade and Organic practices.
    I appreciate your effort to identify alternative and past economic models. While I think we are ultimately creating a new scale and perhaps innovating slightly in applying these concepts to modern society, certainly previous efforts and conceptions are important, inspiring, and instructive.
    Ultimately, I think much current valuation is largely a psychological, sociohistorical, and subjective construct. The true objective value must lie in the energetic units underlying labor and scientific structure. Nevertheless, with sufficient philosophy of science and epistemology, there must be a way there from here.
    We can also benefit from referring to Herman Daly’s Steady State Economics. I need to review it further, but I understand it to mean the economic dynamic equlibrium involving a sustainable balance of resource inputs and recycling of outputs. Additionally, the academic and NGO community already involved in developing Whole Cost accounting frameworks, such as the Index of Sustainable Economic Welfare and environmental accounting systems being developed by such agencies as U.S. EPA and UNEP.
    My time is limited at the moment, so I’ll return later and try to integrate my framework here with your proposal and economic conceptual categories.

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