Book Review:The Ethical Economy
The Ethical Economy: Rebuilding Value After the Crisis, by Adam Arvidsson and Nicolai Peitersen, Columbia University Press, 2013
The Ethical Economy introduces two major intellectuals mapping the transition from early industrial manufacturing and its economics based on objects (things you can drop on your foot) to today’s information economies where intellectual property, intangibles, brands and reputation are the new source of value.
Authors Adam Arvidsson and Nicolai Peitersen join Don Tapscott, Yoichi Benkler, Michel Bauwens and others in mapping this new economic terrain where information offers non-rival “win-win” opportunities for abundance through sharing and cooperation (if you give me information, you still retain it as well).
Following Yoichi Benkler’s The Wealth of Networks, Don Tapscott and Anthony Williams’ Wikinomics, Chris Anderson’s Makers and Michel Bauwens’ peer-to-peer sharing models (P2P Foundation), Arvidsson and Peitersen, both seasoned professionals in business and finance, delve deeper into the implications of this tectonic shift beyond the cover story in The Economist and recent books including Rachel Botsman and Roo Rogers’ Collaborative Consumption and Lorna Gold’s The Sharing Economy to examine the role of technology, the internet, social media, the maker revolution, prosumers, crowdsourcing and “productive publics” and the socialisation of value creation.
This is deeply researched, heady stuff enfolding insights from behavioral science, brand management, ethical investing and the growing importance of reputational risks and benefits. Mainstream economics and financial models are left behind in their material focus on competitive rival goods and assumptions of scarcity.
The rise of this global informational, internet-based economy of social media, open-source, crowdsourcing by over 3 billion ever-more connected, interacting humans is a new economy of the commons – based largely on “publics” and their opinions, infrastructure resources and shared knowledge.
This fuels the skepticism toward corporations, banks, governments and erodes trust in older norm-creating institutions, academia and religious beliefs. The rise of global brands caters to these billions of wary consumers and investors offering reassurance, as does the success of new players such as the Sustainable Brands conference and the EthicMark Awards for Advertising that Uplifts the Human Spirit and Society, which I founded in 2004.
Trust levels have declined since the financial crises of 2008 and drop further with each new scandal, bank bailout, oil spill, pollution episode and euro debt crises, most recently in Cyprus and Slovenia.
Investors fleeing from inflating fiat currencies which used to go to gold now find digital currencies such as bitcoin (fluctuating up to $200) and ven (based in Bermuda) while bank depositors move their savings to cooperative credit unions, now booming in the USA.