Clay Shirky's "Here Comes Everybody: The Power of Organizing Without Organizations" (2008) -- once you've sifted through the largely unfocused pop culture fluff -- is essentially a response to Ronald Coase's 1937 article "The Nature of the Firm," in light of the current technology landscape.
Coase attributed the existence of firms to the prohibitive burden of transaction costs in a firm-free market. "Within a firm, these market transactions are eliminated and in place of the complicated market structure with exchange transactions is substituted the entrepreneur-co-ordinator, who directs production" (Coase, p388). This is now widely accepted as fact, and I'd imagine is the basis for firms' pursuit of horizontal and vertical integration, as well, both past and present.
Shirky, however, argues that some activities, typically ignored by firms because they were below the "floor" of what a firm would willingly invest in, are now becoming possible because they can be organized outside the firm, thanks to plummeting transaction costs. "The collapse of transaction costs makes it easier for people to get together" (Shirky, p48).
Shirky distinguishes between sharing and collaboration - sharing is much easier than collaborating - in a way that sort of mirrors my emphasis on the two sides of "open culture" - participatory inputs (collaboration) and outputs into the commons (sharing), and which got me thinking about open source plugin/addon/module systems -- like Firefox Addons and Drupal contrib -- in which much of the work is not actually performed collaboratively, but merely licensed for sharing.
Like many authors considering these topics, Shirky jumps around WAY too much, but near the end he settles into an interesting discussion about open source software. He describes the open source world as failure tolerant (p245), meaning that most open source projects fail to take off, but the costs of failure are so low that it's just not worth worrying about. "In the open source world, trying something is often cheaper than making a formal decision about whether to try it" (p249).
Aside
I've also been listening to an audio version of Thomas Friedman's "The World is Flat", and I can't help noticing a certain parallel between his thinking and Shirky's. Namely, some of his "Ten Flatteners" (Netscape, workflow software, open source, supply chaining) have helped to lower transaction costs, while several others have been brought on by lower transaction costs: in-forming, outsourcing, offshoring, and so on. Where Shirky argues that lower transaction costs are impacting cultural and technological production, Friedman argues that they are enabling developing countries to catch up with / leapfrog into the developed world. Yet their worldviews don't seem fully compatible. Hmm. Food for thought.
