See also Distributive Enterprise and Distributed Market Substitution.
Distributive Economics is an economic paradigm which promotes the equitable distribution of wealth through a combination of: open design (of products, processes, services, and other economically significant information), Flexible Fabrication, and Open Business Models, towards replicability. This means that replication is promoted to as many economic players as possible. Here at OSE, an apolitical approach is taken where design is improved by local solutions without invoking the context of centralized power.
Distributive economics has several requirements:
- Design repository - a global repository of freely-downloadable design can help any producer start an enterprise, from a small farmer to a high-tech innovator - by providing immediate access to best practices of economically significant products and production - without having to reinvent the wheel. In today's competitive world, there is no repository of optimized designs (these are either proprietary or patented), and by default, most producers provide inferior products, while a few produce the state-of-art. This is a model that works, but wastes tremendous amounts of human creativity and energy. By opening up access to best practices, costs would go down, and access to the best products would increase.
- Appropriate scale - in, his seminal book, Small is Beautiful, E. F. Schumacher discussed that the most holistically-efficient economic processes occur not on the global scale, but on the regional and community scale. Schumacher's viewpoint, while generally accepted as true, is not widely practiced today. Distributive economics favors a scale which does not incur inefficiencies of large scale (overhead costs, bureaucracy, communication costs, logistics, others). Schumacher's conclusion is that human organizations break down after they reach a certain large size, which suggests that in order for enterprise to be efficients, it should not be overly large.
- Flexible fabrication - maximum distribution of the fruits of production occurs via Flexible Fabrication. Flexible fabrication allows producers to (a) make products today using today's best designs. Inflexible fabrication forces producers to face the dilemma of either (b) continuing to produce inferior products that may have been the best known design years ago when the production line was set up, or (c) not producing anything at all for a few weeks while the old line is torn down and a new line is set up.
- Lifetime design - maximizing the useful lifetime of a product, by design, reduces the cost of access to that product. For example, if a product lasts 100 years instead of 10 years, its cost is essentially reduced by a factor of 10, assuming that the initial product cost is the same.
- Free enterprise - this means truly free enterprise where the playing field is leveled by open access to best-practice information (optimized product design, optimized production process design, and other economic analysis). This is the opposite of monopoly capitalism enforced by welfare-state Keynesian economics
- Responsibility - accountability of communities for creating complete local economies implies autonomy on a local scale, while providing positive feedback loops for social and environmental responsibility. The intervening role of the welfare state is diminished as the people take responsibility for their own well-being within their own communities.
- Radical cost reduction - Lifetime design, combined with DIY production - can result in 100-fold cost reduction for a given product. For a whole set of products, such as the infrastructure for an entire community - Radical Hypermodularity can result in another factor 10 reduction - if a given component is used over in other applications, like industrial-strength Lego blocks. Thus, radical cost reduction of 1000 times is possible when a community seizes complete control over its own economic production by attending to lifetime design, local production, and hypermodularity.
How It Works
- It works by being distributive rather than Re-Distributive.
Links on Distributive Production and Open Business Models
- Shoshanna Zuboff, distributed capitalism
- Democratizing Innovation - Eric vonhimmel
- Why are distributive economics important?
The distribution of wealth is continuing to deteriorate, as the rich get richer and the poor is poorer. This phenomenon is accompanied by human abuse and environmental degradation. While it may appear that the advent of advanced technology and of the information age would favor more equitable distribution of wealth, that is not the case.
- Is there a metric for quantifying the success of distributive economics?
There is a qualitative metric known as the Gross National Happiness. To date, it has been adopted as the official policy only in the country of Bhutan. OSE Specifications are a metric for quantifying distributive economic potential by attaching a score to a particular product or activity.
- Would there be enough wealth for everybody if all the capital in the world were distributed among all the earth's denizens?
The answer is positive only if there were not a single greedy person on the planet.
- Would the distributive economics paradigm disrupt the mainstream economic system?
There is no reason why both systems can not co-exist side-by-side. On an equal playing field, both would compete for market share, and the best one would win, assuming that there is no foul play.
- You effin communists, are you trying to bring down the entire economic system, which has brought us all the quality of life that we all enjoy today?
We are apolitical, we do not promote state capitalism or any political ideology - we are providing a set of tools that can be used in numerous applications. Nor do we think that "we all enjoy today" a high standard of living. A high standard of living applies only to a small fraction of the global population.
- Are you suggesting a new economic concept?
There is nothing new about the concept of distributive economics. Buckminster Fuller, Gandhi, Martin Luther King, among other thought leaders, have discussed the concept at length, though by using different languaging. It is a concept endorsed in theory by liberals, conservatives, environmentalists, radicals, anarchists, fundamentalists, capitalists, socialists, and many others, but it is rarely practiced. Social enterprise and the Bright Green approach are on the right track, but short of articulating the full scope of the open source/open business model paradigm. http://floing.org is a site that attempts to document this emerging paradigm.