Clay Shirky’s “Here Comes Everybody”

Shirky has some good ideas and explains them so well that they seem obvious. The book is not written as a scholarly monograph, yet it has good argumentation. A brief encapsulation of Shirky’s thesis follows.

Ages ago (in 1937) Ronald Coase came up with a framework for thinking about firm formation by making transaction costs the focal point. Shirky says that the internet has made the transaction costs of organizing ad hoc groups of people so small that people can now achieve things that a few years ago required massive expenditures of resources by large, institutionalized, organizations. These days, even huge organizations such as Microsoft or the media companies find it impossible to compete with some open source efforts, because open source can easily afford making mistakes. Indeed, it prospers by exploring a tremendous number of ideas and simply ignoring the unproductive ones. (Those who have read the book can tell that I am currently completing chapter 10 from the emphasis here.) The ability of individuals to casually organize and use small contributions by many combines with the ability to tolerate errors into something very powerful, for good but also for evil.

I don’t think all the ideas he expounds are original with Shirky. Many seem to have been in the air for a while now. I wish I could follow through on a vague citation he makes in an endnote on page 317 to the Harvard Business Review, but my online searching has not found the article he credits there. It does appear that the formal modeling of some of these ideas in the fashion of economics could be carried out more than it has so far.

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