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March 10, 2006

The Sharing Economy

In the previous entry I mentioned about new age economics ...I am not an economist so there should be better explanations for this. But what is happening with Skype and slashdot and maybe even Wikipedia ?

Its the sharing economy - says professor at Yale Law School, Yochai Benkler. Read the whole article here http://www.businessweek.com/magazine/content/05_25/b3938902.htm

So what does this mean ... strangers are coming together to produce goods remotely ... goods that are more like civic goods (for the commons) than private goods. Thats pretty neat! Open source projects, free content and knowledge sources are examples of these ...

But wait a minute. Whatever happened to the old saying ..."there's nothing like a free lunch". Well in this case, the producers are bearing the cost ...for the benefit of the commons. Hats off to them ... Their incentives ... respect and social capital in the online community. Good enough to sustain them so far ...

What does it mean for businesses? For starters, perhaps they should create such communities internally. Create communities which contribute for the benefit of the community ... not the regular tasks as part of regular jobs but "the above and beyond" part. Will employees work beyond their responsibilities to contribute for the growth of the company? Where is the WIIFM (What's in it for me?) question ...

Maybe they should sponsor more of the open source consortiums ...In any case, there is a new kind of market phenomenon at least in open source software, now content and communication.

P.S: There also seems to be two types of "economies" ... the production-sharing economy (produce for common good) and the community-based economy (where people trade within the community so that the cash flow is within -- an age old concept)

Posted by vdakshin at March 10, 2006 06:54 PM

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