Economics and Complexity

James Glattfelder studies complexity: how an interconnected system -- say, a swarm of birds -- is more than the sum of its parts. And complexity theory, it turns out, can reveal a lot about how the economy works. Glattfelder shares a groundbreaking study of how control flows through the global economy, and how concentration of power in the hands of a shockingly small number leaves us all vulnerable. (Filmed at TEDxZurich.)

James B. Glattfelder aims to give us a richer, data-driven understanding of the people and interactions that control our global economy. He does this not to push an ideology -- but with the hopes of making the world a better place.

 http://on.ted.com/Glattfelder

First a researcher at a Swiss hedge fund and then a physicist, James B. Glattfelder found himself amazed by the level of understanding we have in regards to the physical world and universe around us. He wondered: how can we move toward a similar understanding of human society?

This question led him to the study of complex systems, a subject he now holds a Ph.D in from the Swiss Federal Institute of Technology. Glattfelder is co-head of quantitative research at Olsen Ltd in Zurich, an FX investment manager focusing on market-stabilizing algorithms. In 2011, he co-authored the study “The Network of Global Corporate Control,” which went viral in the international media and sparked many controversial discussions. The study looked at the architecture of ownership across the globe, and computed a level of control exerted by each international player. The study revealed that 75% of all the players in the global economy are part of a highly interconnected core which, because of the high levels of overlap, leaves the economy vulnerable.

In his free time, Glattfelder enjoys snowboarding, rock climbing, surfing and listening to electronic music.

"As protests against financial power sweep the world this week, science may have confirmed the protesters' worst fears. An analysis of the relationships between 43,000 transnational corporations has identified a relatively small group of companies, mainly banks, with disproportionate power over the global economy ... The study, by a trio of complex systems theorists at the Swiss Federal Institute of Technology in Zurich, is the first to go beyond ideology to empirically identify such a network of power."

The New S

 http://www.ted.com/speakers/james_b_glattfelder.html

Scaling in Biological, Business and Social Systems

There are some extremely powerful and useful concepts only introduced here. This requires more study to really absorb. As I understand it one of the implications of this work is that innovation is key to the survival of cities, but doesn't help much for companies.

Physicist Geoffrey West has found that simple, mathematical laws govern the properties of cities -- that wealth, crime rate, walking speed and many other aspects of a city can be deduced from a single number: the city's population. In this mind-bending talk from TEDGlobal he shows how it works and how similar laws hold for organisms and corporations.

The Wealth of Networks: How Social Production Transforms Markets and Freedom

I normally write extensive reviews of the books I read. I’m not able to do this with this book. Yochai Benkler’s book is so comprehensive in scope and detail (515pp) that it defies summarization. Suffice it to say that this is the authoritative book on the subjects of networks and social production. It’s a difficult read (the academic language) but rewards the reader with an unsurpassed view of the landscape it covers. In the author’s own words in the acknowledgments, “Another great debt is to David Grais, who spent many hours mentoring me in my first law job, bought me my first copy of Strunk and White, and, for all practical purposes, taught me how to write in English; as he reads these words, he will be mortified, I fear, to be associated with a work of authorship as undisciplined as this, with so many excessively long sentences, replete with dependent clauses and unnecessarily complex formulations of quite simple ideas.” Lawrence Lessig comments, “In this book, Benkler establishes himself as the leading intellectual of the information age.”

What is written here is my attempt to cover the salient points of the introduction.

He begins with, “Information, knowledge, and culture are central to human freedom and human development. How they are produced and exchanged in our society critically affects the way we see the state of the world as it is and might be; who decides these questions; and how we, as societies and polities, come to understand what can and ought to be done. For more than 150 years, modern complex democracies have depended in large measure on an industrial information economy for these basic functions. In the past decade and a half, we have begun to see a radical change in the organization of information production. Enabled by technological change, we are beginning to see a series of economic, social, and cultural adaptations that make possible a radical transformation of how we make the information environment we occupy as autonomous individuals, citizens, and members of cultural and social groups. It seems passe´ today to speak of “the Internet revolution.” In some academic circles, it is positively naıve. But it should not be. The change brought about by the networked information environment is deep. It is structural. It goes to the very foundations of how liberal markets and liberal democracies have coevolved for almost two centuries.

A series of changes in the technologies, economic organization, and social practices of production in this environment has created new opportunities for how we make and exchange information, knowledge, and culture. These changes have increased the role of nonmarket and nonproprietary production, both by individuals alone and by cooperative efforts in a wide range of loosely or tightly woven collaborations. These newly emerging practices have seen remarkable success in areas as diverse as software development and investigative reporting, avant-garde video and multiplayer online games. Together, they hint at the emergence of a new information environment, one in which individuals are free to take a more active role than was possible in the industrial information economy of the twentieth century. This new freedom holds great practical promise: as a dimension of individual freedom; as a platform for better democratic participation; as a medium to foster a more critical and self-reflective culture; and, in an increasingly information dependent global economy, as a mechanism to achieve improvements in human development everywhere.

The rise of greater scope for individual and cooperative nonmarket production of information and culture, however, threatens the incumbents of the industrial information economy. At the beginning of the twenty-first century, we find ourselves in the midst of a battle over the institutional ecology of the digital environment. A wide range of laws and institutions— from broad areas like telecommunications, copyright, or international trade regulation, to minutiae like the rules for registering domain names or whether digital television receivers will be required by law to recognize a particular code—are being tugged and warped in efforts to tilt the playing field toward one way of doing things or the other. How these battles turn out over the next decade or so will likely have a significant effect on how we come to know what is going on in the world we occupy, and to what extent and in what forms we will be able—as autonomous individuals, as citizens, and as participants in cultures and communities—to affect how we and others see the world as it is and as it might be.”

He explains the emergence of the networked information economy, “The most advanced economies in the world today have made two parallel shifts that, paradoxically, make possible a significant attenuation of the limitations that market-based production places on the pursuit of the political values central to liberal societies. The first move, in the making for more than a century, is to an economy centered on information (financial services, accounting, software, science) and cultural (films, music) production, and the manipulation of symbols (from making sneakers to branding them and manufacturing the cultural significance of the Swoosh). The second is the move to a communications environment built on cheap processors with high computation capabilities, interconnected in a pervasive network—the phenomenon we associate with the Internet. It is this second shift that allows for an increasing role for nonmarket production in the information and cultural production sector, organized in a radically more decentralized pattern than was true of this sector in the twentieth century. The first shift means that these new patterns of production—nonmarket and radically decentralized—will emerge, if permitted, at the core, rather than the periphery of the most advanced economies. It promises to enable social production and exchange to play a much larger role, alongside property- and market based production, than they ever have in modern democracies.”

He makes three observations about this emergence:

1. Nonproprietary strategies have always been more important in information production than they were in the production of steel or automobiles, even when the economics of communication weighed in favor of industrial models.
2. We have in fact seen the rise of nonmarket production to much greater importance. Individuals can reach and inform or edify millions around the world. Such a reach was simply unavailable to diversely motivated individuals before, unless they funneled their efforts through either market organizations or philanthropically or state-funded efforts.
3. And, likely most radical, new, and difficult for observers to believe, is the rise of effective, large-scale cooperative efforts—peer production of information, knowledge, and culture.

He states that individuals have enhanced autonomy: “The networked information economy improves the practical capacities of individuals along three dimensions: (1) it improves their capacity to do more for and by themselves; (2) it enhances their capacity to do more in loose commonality with others, without being constrained to organize their relationship through a price system or in traditional hierarchical models of social and economic organization; and (3) it improves the capacity of individuals to do more in formal organizations that operate outside the market sphere. This enhanced autonomy is at the core of all the other improvements I describe. Individuals are using their newly expanded practical freedom to act and cooperate with others in ways that improve the practiced experience of democracy, justice and development, a critical culture, and community.”

The major battle to be fought is between open and proprietary models. “The battle over the relative salience of the proprietary, industrial models of information production and exchange and the emerging networked information economy is being carried out in the domain of the institutional ecology of the digital environment. In a wide range of contexts, a similar set of institutional questions is being contested: To what extent will resources necessary for information production and exchange be governed as a commons, free for all to use and biased in their availability in favor of none? To what extent will these resources be entirely proprietary, and available only to those functioning within the market or within traditional forms of well funded nonmarket action like the state and organized philanthropy? We see this battle played out at all layers of the information environment: the physical devices and network channels necessary to communicate; the existing information and cultural resources out of which new statements must be made; and the logical resources—the software and standards—necessary to translate what human beings want to say to each other into signals that machines can process and transmit. Its central question is whether there will, or will not, be a core common infrastructure that is governed as a commons and therefore available to anyone who wishes to participate in the networked information environment outside of the market-based, proprietary framework.”

He writes about four choices: “There are four methodological choices represented by the thesis that I have outlined up to this point, and therefore in this book as a whole, which require explication and defense. The first is that I assign a very significant role to technology. The second is that I offer an explanation centered on social relations, but operating in the domain of economics, rather than sociology. The third and fourth are more internal to liberal political theory. The third is that I am offering a liberal political theory, but taking a path that has usually been resisted in that literature—considering economic structure and the limits of the market and its supporting institutions from the perspective of freedom, rather than accepting the market as it is, and defending or criticizing adjustments through the lens of distributive justice. Fourth, my approach heavily emphasizes individual action in nonmarket relations. Much of the discussion revolves around the choice between markets and nonmarket social behavior. In much of it, the state plays no role, or is perceived as playing a primarily negative role, in a way that is alien to the progressive branches of liberal political thought. In this, it seems more of a libertarian or an anarchistic thesis than a liberal one. I do not completely discount the state, as I will explain. But I do suggest that what is special about our moment is the rising efficacy of individuals and loose, nonmarket affiliations as agents of political economy. Just like the market, the state will have to adjust to this new emerging modality of human action. Liberal political theory must first recognize and understand it before it can begin to renegotiate its agenda for the liberal state, progressive or otherwise.”

This book is well worth studying and would make a great text for discussion group. If anyone out there has read the book and would like to collaborate on such an endeavor, please let me know.

The Wealth of Networks: How Social Production Transforms Markets and Freedom, Yochai Benkler, Yale University Press, 2006, 515pp

The Wealth of Networks (PDF)

Autonomy

Yochai Benkler has written a masterful book on social production and networks. As I read this section last night I was struck with the thought that autonomy is the unspoken word at the center of a lot of controversy in our society. The conversation should be focused on autonomy overtly:

• How much autonomy is required for individual freedom?
• When does my autonomy begin to impinge on yours?
• How does my autonomy empower yours?
• What’s the boundary between my autonomy and limits placed by government, corporate and religious interests?
• How do government, corporate and religious entities empower my autonomy?
• How do we protect the personal autonomy that is emerging through the Internet, social production and web 2.0 software?
  

“The autonomy deficit of private communications and information systems is a result of the formal structure of property as an institutional device and the role of communications and information systems as basic requirements in the ability of individuals to formulate purposes and plan actions to fit their lives. The gains flow directly from the institutional characteristics of commons. The emergence of the networked information economy makes one other important contribution to autonomy. It qualitatively diversifies the information available to individuals. Information, knowledge, and culture are now produced by sources that respond to a myriad of motivations, rather than primarily the motivation to sell into mass markets. Production is organized in anyone of a myriad of productive organizational forms, rather than solely the for-profit business firm. The supplementation of the profit motive and the business organization by other motivations and organizational forms-ranging from individual play to large-scale peer-production projects-provides not only a discontinuously dramatic increase in the number of available information sources but, more significantly, an increase in available information sources that are qualitatively different from others.

Imagine three storytelling societies: the Reds, the Blues, and the Greens.

Each society follows a set of customs as to how they live and how they tell stories. Among the Reds and the Blues, everyone is busy all day, and no one tells stories except in the evening. In the evening, in both of these societies, everyone gathers in a big tent, and there is one designated storyteller who sits in front of the audience and tells stories. It is not that no one is allowed to tell stories elsewhere. However, in these societies, given the time constraints people face, if anyone were to sit down in the shade in the middle of the day and start to tell a story, no one else would stop to listen. Among the Reds, the storyteller is a hereditary position, and he or she alone decides which stories to tell. Among the Blues, the storyteller is elected every night by simple majority vote. Every member of the community is eligible to offer him- or herself as that night's storyteller, and every member is eligible to vote. Among the Greens, people tell stories all day, and everywhere. Everyone tells stories. People stop and listen if they wish, sometimes in small groups of two or three, sometimes in very large groups. Stories in each of these societies play a very important role in understanding and evaluating the world. They are the way people describe the world as they know it. They serve as testing grounds to imagine how the world might be, and as a way to work out what is good and desirable and what is bad and undesirable. The societies are isolated from each other and from any other source of information.

Now consider Ron, Bob, and Gertrude, individual members of the Reds, Blues, and Greens, respectively. Ron's perception of the options open to him and his evaluation of these options are largely controlled by the hereditary storyteller. He can try to contact the storyteller to persuade him to tell different stories, but the storyteller is the figure who determines what stories are told. To the extent that these stories describe the universe of options Ron knows about, the storyteller defines the options Ron has. The storyteller's perception of the range of options largely will determine the size and diversity of the range of options open to Ron. This not only limits the range of known options significantly, but it also prevents Ron from choosing to become a storyteller himself. Ron is subjected to the storyteller's control to the extent that, by selecting which stories to tell and how to tell them, the storyteller can shape Ron's aspirations and actions. In other words, both the freedom to be an active producer and the freedom from the control of another are constrained. Bob's autonomy is constrained not by the storyteller, but by the majority of voters among the Blues. These voters select the storyteller, and the way they choose will affect Bob's access to stories profoundly. If the majority selects only a small group of entertaining, popular, pleasing, or powerful (in some other dimension, like wealth or political power) storytellers, then Bob's perception of the range of options will be only slightly wider than Ron's, if at all. The locus of power to control Bob's sense of what he can and cannot do has shifted. It is not the hereditary storyteller, but rather the majority. Bob can participate in deciding which stories can be told. He can offer himself as a storyteller every night. He cannot, however, decide to become a storyteller independently of the choices of a majority of Blues, nor can he decide for himself what stories he will hear. He is significantly constrained by the preferences of a simple majority. Gertrude is in a very different position. First, she can decide to tell a story whenever she wants to, subject only to whether there is any other Green who wants to listen. She is free to become an active producer except as constrained by the autonomy of other individual Greens. Second, she can select from the stories that any other Green wishes to tell, because she and all those surrounding her can sit in the shade and tell a story. No one person, and no majority, determines for her whether she can or cannot tell a story. No one can unilaterally control whose stories Gertrude can listen to. And no one can determine for her the range and diversity of stories that will be available to her from any other member of the Greens who wishes to tell a story.

The difference between the Reds, on the one hand, and the Blues or Greens, on the other hand, is formal. Among the Reds, only the storyteller !hay tell the story as a matter of formal right, and listeners only have a choice of whether to listen to this story or to no story at all. Among the Blues and the Greens anyone may tell a story as a matter of formal right, and listeners, as a matter of formal right, may choose from whom they will hear. The difference between the Reds and the Blues, on the one hand, and the Greens, on the other hand, is economic. In the former, opportunities for storytelling are scarce. The social cost is higher, in terms of stories unavailable for hearing, or of choosing one storyteller over another. The difference between the Blues and the Greens, then, is not formal, but practical. The high cost of communication created by the Blues' custom of listening to stories only in the evening, in a big tent, together with everyone else, makes it practically necessary to select "a storyteller" who occupies an evening. Since the stories play a substantive role in individuals' perceptions of how they might live their lives, that practical difference alters the capacity of individual Blues and Greens to perceive a wide and diverse set of options, as well as to exercise control over their perceptions and evaluations of options open for living their lives and to exercise the freedom themselves to be storytellers. The range of stories Bob is likely to listen to, and the degree to which he can choose unilaterally whether he will tell or listen, and to which story, are closer, as a practical matter, to those of Ron than to those of Gertrude. Gertrude has many more stories and storytelling settings to choose from, and many more instances where she can offer her own stories to others in her society. She, and everyone else in her society, can be exposed to a wider variety of conceptions of how life can and ought to be lived. This wider diversity of perceptions gives her greater choice and increases her ability to compose her own life story out of the more varied materials at her disposal. She can be more self-authored than either Ron or Bob. This diversity replicates, in large measure, the range of perceptions of how one might live a life that can be found among all Greens, precisely because the storytelling customs make every Green a potential storyteller, a potential source of information and inspiration about how one might live one's life.

All this could sound like a morality tale about how wonderfully the market maximizes autonomy. The Greens easily could sound like Greenbacks, rather than like environmentalists staking out public parks as information commons. However, this is not the case in the industrial information economy, where media markets have high entry barriers and large economies of scale. It is costly to start up a television station, not to speak of a network, a newspaper, a cable company, or a movie distribution system. It is costly to produce the kind of content delivered over these systems. Once production costs or the costs of laying a network are incurred, the additional marginal cost of making information available to many users, or of adding users to the network, is much smaller than the initial cost. This is what gives information and cultural products and communications facilities supply-side economies of scale and underlies the industrial model of producing them. The result is that the industrial information economy is better stylized by the Reds and Blues rather than by the Greens. While there is no formal limitation on anyone producing and disseminating information products, the economic realities limit the opportunities for storytelling in the mass mediated environment and make storytelling opportunities a scarce good. It is very costly to tell stories in the mass-mediated environment. Therefore, most storytellers are commercial entities that seek to sell their stories to the audience. Given the discussion earlier in this chapter, it is fairly straightforward to see how the Greens represent greater freedom to choose to become an active producer of one's own information environment. It is similarly dear that they make it exceedingly difficult for any single actor to control the information flow to any other actor. We can now focus on how the story provides a way of understanding the justification and contours of the third focus of autonomy-respecting policy: the requirement that government not limit the quantity and diversity of information available.

The fact that our mass-mediated environment is mostly commercial makes it more like the Blues than the Reds. These outlets serve the tastes of the majority-expressed in some combination of cash payment and attention to advertising. I do not offer here a full analysis-covered so well by Baker in Media, Markets, and Democracy-as to why mass-media markets do not reflect the preferences of their audiences very well. Presented here is a tweak of an older set of analyses of whether monopoly or competition is better in mass-media markets to illustrate the relationship between markets, channels, and diversity of Content. In chapter 6, I describe in greater detail the Steiner¬Beebe model of diversity and number of channels. For our purposes here, it is enough to note that this model shows how advertiser-supported media tend to program lowest-common-denominator programs, intended to "capture the eyeballs" of the largest possible number of viewers. These media do not seek to identify what viewers intensely want to watch, but tend to clear programs that are tolerable enough to viewers so that they do not switch off their television. The presence or absence of smaller-segment oriented television depends on the shape of demand in an audience, the number of channels available to serve that audience, and the ownership structure. The relationship between diversity of content and diversity of structure or ownership is not smooth. It occurs in leaps. Small increases in the number of outlets continue to serve large clusters of low-intensity preferences-that is, what people find acceptable. A new channel that is added will more often try to take a bite out of a large pie represented by some lowest-common denominator audience segment than to try to serve a new niche market. Only after a relatively high threshold number of outlets are reached do advertiser-supported media have sufficient reason to try to capture much smaller and higher-intensity preference clusters-what people are really interested in. The upshot is that if all storytellers in society are profit maximizing and operate in a market, the number of storytellers and venues matters tremendously for the diversity of stories told in a society. It is quite possible to have very active market competition in how well the same narrow set of stories are told, as opposed to what stories are told, even though there are many people who would rather hear different stories altogether, but who are in clusters too small, too poor, or too uncoordinated to persuade the storytellers to change their stories rather than their props.

The networked information economy is departing from the industrial information economy along two dimensions that suggest a radical increase in the number of storytellers and the qualitative diversity of stories told. At the simplest level, the cost of a channel is so low that some publication capacity is becoming available to practically every person in society. Ranging from an e-mail account, to a few megabytes of hosting capacity to host a subscriber's Web site, to space on a peer-to-peer distribution network available for any kind of file (like FreeNet or eDonkey), individuals are now increasingly in possession of the basic means necessary to have an outlet for their stories. The number of channels is therefore in the process of jumping from some infinitesimally small fraction of the population-whether this fraction is three networks or five hundred channels almost does not matter by comparison-to a number of channels roughly equal to the number of users. This dramatic increase in the number of channels is matched by the fact that the low costs of communications and production enable anyone who wishes to tell a story to do so, whether or not the story they tell will predictably capture enough of a paying (or advertising-susceptible) audience to recoup production costs. Self-expression, religious fervor, hobby, community seeking, political mobilization, anyone of the many and diverse reasons that might drive us to want to speak to others is now a sufficient reason to enable us to do so in mediated form to people both distant and close. The basic filter of marketability has been removed, allowing anything that emerges out of the great diversity of human experience, interest, taste, and expressive motivation to flow to and from everyone connected to everyone else. Given that all diversity within the industrial information economy needed to flow through the marketability filter, the removal of that filter marks a qualitative increase in the range and diversity of life options, opinions, tastes, and possible life plans available to users of the networked information economy.”

The Wealth of Networks: How Social Production Transforms Markets and Freedom, Yochai Benkler, Yale University Press, 2006

Culture Networks

By Tim Stock

An updated version of my lecture on Culture Networks for this semester’s Analyzing Trends class at Parsons the New School for Design.

Culture Networks 2010

View more presentations from Tim Stock.

The Hidden Influence of Social Networks

We're all embedded in vast social networks of friends, family, co-workers and more. Nicholas Christakis tracks how a wide variety of traits -- from happiness to obesity -- can spread from person to person,showing how your location in the network might impact your life in ways you don't even know.

People aren't merely social animals in the usual sense, for we don't just live in groups. We live in networks -- and we have done so ever since we emerged from the African savannah. Via intricately branching paths tracing out cascading family connections, friendship ties, and work relationships, we are interconnected to hundreds or thousands of specific people, most of whom we do not know. We affect them and they affect us.

Nicholas Christakis' work examines the biological, psychological, sociological, and mathematical rules that govern how we form these social networks, and the rules that govern how they shape our lives. His work shows how phenomena as diverse as obesity, smoking, emotions, ideas, germs, and altruism can spread through our social ties, and how genes can partially underlie our creation of social ties to begin with. His work also sheds light on how we might take advantage of an understanding of social networks to make the world a better place.



At Harvard, Christakis is a Professor of Medicine, Health Care Policy, and Sociology, and he directs a diverse research group investigating social networks. His popular undergraduate course (Life and Death in the US) is podcast [available on itunes]. His book, Connected, co-authored with James H. Fowler, appeared in 2009, and has been translated into nearly 20 languages. In 2009, he was named by Time magazine to its annual list of the 100 most influential people in the world, and also by Foreign Policy magazine to its list of 100 top global thinkers.

The Wealth of Networks

Lawrence Lessig recommends that we read Yochai Benkler's 'The Wealth of Networks': How Social Production Transforms Markets and Freedom.

From Amazon.com:

From Publishers Weekly
In this thick academic book, Yale law professor Benkler offers a comprehensive catalog of flashpoints in the conflict between old and new information creators. In Benkler's view, the new "networked information economy" allows individuals and groups to be more productive than profit-seeking ventures. New types of collaboration, such as Wikipedia or SETI@Home, "offer defined improvements in autonomy, democratic discourse, cultural creation, and justice"-as long as government regulation aimed at protecting old-school information monoliths (such as the Digital Millennium Copyright Act) doesn't succeed. Non-market innovation is a good thing in itself and doesn't even have to threaten entrenched interests, Benkler argues; rather, "social production" can use resources that the industrial information economy leaves behind. Where Benkler excels is in bringing together disparate strands of the new information economy, from the democratization of the newsmedia via blogs to the online effort publicizing weaknesses in Diebold voting machines. Though Benkler doesn't really present any new ideas here, and sometimes draws simplistic distinctions, his defense of the Internet's power to enrich people's lives is often stirring.

Review
"'An ambitious attempt to understand how the internet is changing society... The book draws on a staggering array of disciplines: from graph theory to economics, law to political science. But Benkler's breadth is not at the expense of depth. He never falls for easy, superficial conclusions. His writing is clear and readable... This is an important book." Paul Miller, Financial Times Magazine 'New networks offer a glimpse of the new polity and the ancient regime is struggling to prevent its birth. The Wealth of Networks is a reveille for netizens... Few are unaware that this sector is undergoing transformation, and Benkler's identification of major forces at work is important and enlightening.' Paul Duguid, Times Literary Supplement 'That the internet is changing society is understood. Less appreciated is how society is changing the internet. In this respect, Benkler's work masterfully explains the political and economic forces at play, their promises and their threats. Ultimately, his contribution is to shift our view of the network from the individual to the ad-hoc group. For this, his book is of lasting significance.' New Statesman"

The Power of Passion in a Networked World

We are moving to a more responsive, interactive, collaborative world, which is already disrupting conventional business models and releasing energies and new ways of doing things that create new solutions and opportunities. Personal interest, energy, passions, ideas and opinions - and little or no direct personal financial gain - are fuelling everything from Linux software to distributed computing in support of big science projects, to Wikipedia to blogs to indexed photo collections to and scientific publishing would appear to be next in line.
But, companies too can benefit from similar passion, if they respond effectively; as Lego found out recently. A group of its adult fans hacked into one of their design tools, but instead of shutting them out, the company welcomed them in: to collaborate and discuss options and ideas. Lego managed their boundaries and privacy flexibly to create committed pro-sumers. (see Hacking's a snap in Legoland; News.com)

Tim O'Reilly described the changes at the recent Web 2.0 conference "Web 2.0" stands for the idea that the Internet is evolving from a collection of static pages into a vehicle for software services, especially those that foster self-publishing, participation, and collaboration" (see Web 2.0 has arrived; Technology Review.com) as one of the best illustrations is the difference between the Encyclopaedia Britannica and Wikipedia. Other characteristics and indicative products of this new world can be found at What Is Web 2.0 (tim.oreilly.com)

Collaborative science projects using distributed desktop PC downtime to create sufficient computing power to support big projects, such as the project looking for life in outer space were an early example, back in 2000 (see Home computers add grunt to scientific discovery; (ABC)These were hotly followed by the development of Wikipedia in 2001 - which still has only one full time employee, but over 770,000 essays in English, nearly half a million contributors, 2 billion hits per month and is funded by donations.

Sheila Moorcroft, Research Director, Shaping Tomorrow

Mapping a City's Rhythm

Kate Greene, Technology Review

The New York startup, Sense Networks, has developed algorithms that can identify distinct types of behaviors of people in a city, and group them into so-called tribes. The first animation shows the changing whereabouts of these tribes over the course of an evening in San Francisco and the second animation depicts the process of identifying the primary tribes visiting the top 200 nightlife destinations during a certain period of the night.

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When Sensors and Social Networks Mix

Richard MacManus, ReadWriteWeb

The integration of sensors with social networks will lead to real-time data and more useful web apps.

In recent posts we reviewed an MIT experiment called WikiCity, that gathered real-time location data from mobile phones in Rome and graphically mapped trends from it. We then looked at a more commercial product doing similar real-time location data analysis, called Citysense. That product aims to let users find the most popular night spots in San Francisco and the most efficient ways to get to them. The next stage of projects/products such as Wikicity and Citysense will be to enable users to social network, using data from sensors as one input.

Citysense is already heading in that direction, with the next release of its product aiming to guide 'tribes' of people together using location data. It will soon be able to show not only where anonymous groups of people are in real time, but where people with similar behavioral patterns to you are. To do this Citysense will categorize people into "tribes" - so far 20 tribes have been identified, including "young and edgy," "business traveler," "weekend mole," and "homebody." It will use not just GPS (location) data from mobile phones and taxis, but also publicly available company address data and demographic data from the U.S. Census Bureau.

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See also Smart Mobs

The Micro-Sociology of Networks

The Micro-Sociology of Networks

View more presentations from David Armano. (tags: behavior human)

The Customer Collective, Darvid Armano
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The Social Graph of a Famous Mathematician

Valdis Krebs, orgnet.com

This is the social graph [a.k.a. social network map] of Paul Erdõs. He was an expert in the mathematics of networks. Erdõs practiced what he preached -- he was a weaver of social networks and thus a builder of social capital.

Erdõs was known for traveling the world and collaborating with mathematicians on problems and proofs he found interesting. Many scientific papers resulted from these intense face-to-face collaborations. Erdõs had 507 co-authors, some of whom collaborated with each other. Erdõs's partnerships exposed the social structure of scientific discovery. An excellent mathematical analysis -- Evolution of the social network of scientific collaborations[PDF] -- is available from Laszlo Barabasi and colleagues.

These collaborations became so famous that soon mathematicians were keeping track of their Erdõs Numbers. If you co-authored an article with Erdõs you have a number of 1, if you co-authored a paper with one of his direct collaborators you have an Erdõs Number of 2, and so on. It has become very prestigious in the mathematics community to have a low Erdõs Number. Dr. Jerry Grossman maintains a data repository of Erdõs numbers and collaborators -- The Erdõs Number Project -- from which I constructed the collaborator graph.

Experts have long argued about the optimal structure of a person's professional network. Some say that a dense, cohesive network brings more social capital, while others argue that a sparse, radial network, one that provides opportunities for innovation and entrepreneurial activity, equates to greater social capital. Erdõs's network shows both patterns -- a densely connected core along with loosely coupled radial branches reaching out from the core. According to Ron Burt -- a leading expert on social capital -- this structure may be the optimal pattern for success. According to Burt, radial ties reach diverse information and knowledge to create value, while the dense, trusted ties deliver value in discovered opportunities. For a complete analysis read Burt's seminal work -- The Network Structure of Social Capital[PDF].

What is the structure of your professional network?