Increased Supply Now Means Plentitude

Kevin Kelly has a short piece on his ‘New Rules For The New Economy’ site about the changes to our industrial-age learned economic thinking. He says that in the past scarcity kept prices up but now the reverse is true and that we should value the relationship more than the ‘copy’:

First hoary axiom: Value comes from scarcity. Take the icons of wealth in the industrial age–diamonds, gold, oil, and college degrees. These were deemed precious because they were scarce.

Second hoary axiom: When things are made plentiful, they become devalued. For instance, carpets. They were once rare handmade items found only in houses of the rich. They ceased to be status symbols when they could be woven by the thousands on machines. The traditional law was fulfilled: commonness reduces value.

The logic of the network flips this industrial lesson upside down. In a network economy, value is derived from plentitude, just as a fax machine’s value increases as fax machines become ubiquitous. Power comes from abundance. Copies are cheap. Let them proliferate.

Ever since Gutenberg made the first commodity–cheaply duplicated words–we have realized that intangible things can easily be copied. This lowers the value per copy. What becomes valuable is the relationships–sparked by the copies–that tangle up in the network itself. The relationships rocket upward in value as the parts increase in number even slightly.

…In the future, cotton shirts, bottles of vitamins, chain saws, and the rest of the industrial objects in the world will also obey the law of plentitude as the cost of producing an additional copy of them falls steeply.

New Rules for the New Economy