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Silviu Necoara: The ZERO marginal cost Economy: Is Open Source the future economic paradigm?

Licence Economie et Gestion

Parcours INTERNATIONAL ECONOMICS AND MANAGEMENT

Research report

Silviu NECOARA

The ZERO marginal cost economy

Is Open Source the future economic paradigm?

ate of the viva! "# $e%ruary &"'#

Supervisor! (ulien )ENIN

*em%er of the +oE! Thierry +,R-ER./E0*C/EN

Ta%le of Contents


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Introduction 1222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222 3

I2 Current Situation

1. The Paradox o Ca!ita"ism.................................................................................. #

$. Some side eects o the ado!tion o Ca!ita"ism................................................. %

&. A ne' mo(ement emer)es* The O!en Source econom+......................................,

II2 oes Open Source have 4hat it ta5es to %ecome the ne6t paradigm?

1. -irms and marets re!"aced /+ communities0 -rom Consumers to Prosumers...1#

$. o' to inance the inrastructure in an o!en source econom+............................1%

&. Moti(ation ..2.....................................................................................................13

#. The -ree Rider Di"emma..................................................................................... 1,

III2 7hat does it change in society

1. En(ironment 2....................................................................................................$4

$. Indi(idua"s )et a chance to /e the chan)e the+ 'ant to see in the 'or"d 2....... $1

&. 5oundaries to /e esta/"ished0 Pri(ac+ 2............................................................ $&

#. -rom o'nershi! to access...........2.....................................................................$#

Conclusion 1222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222&8

References 1222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222222 &9

A%stract!


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The !ur!ose o this !a!er is to raise a'areness o the act that the ca!ita"ist s+stem is /ui"t u!on

contradictor+ h+!otheses0 that it is destined to ai"0 and that there are se(era" o!en source

mo(ements 'hich are emer)in). In this !a!er 'e !ut a"" o these acts to)ether and tr+ to see i the

ne' s+stem 'hich is ormin) has 'hat it taes to /e the next economic !aradi)m. Another )oa" o

this !a!er is to sho' 'hat the o!en source mo(ement 'i"" chan)e or humanit+ and ho' it can

im!ro(e our "i(es in societ+. 6e conc"ude that o!en source can /e the uture economic !aradi)m0

ater 'e "oo o(er the moti(ation0 ho' to inance its inrastructure0 and one conce!t 'hich cou"d

raise a !ro/"em or the o!en source societ+0 'hich is the ree rider di"emma. 6e a"so !oint out the

chan)es that it can /rin) rom an en(ironmenta" !oint o (ie' and at an indi(idua" "e(e".

:ey4ords! O!en Source0 Prosumers0 Internet o Thin)s0 Ener)+ Internet0 Lo)istics Internet0

Ca!ita"ism0 &D !rintin)0 C"ean Ener)+0 En(ironment0 Smart inrastructure0 -ree Rider Di"emma

Introduction

Toda+0 humanit+ is 'itnessin) the /e)innin) o the end o a (er+ im!ortant sta)e in its

e(o"ution* the ca!ita"ist !aradi)m. A ne' !henomenon 'hich rose in the !ast decades is no'

coexistin) 'ith0 and e(en re!"acin) ca!ita"ism in man+ ie"ds* the o!en source mo(ement. As

7erem+ Riin sa+s in his master!iece 8The 9ERO Mar)ina" Cost Societ+:0 8the ca!ita"ist era is

!assin)...not ;uic"+0 /ut ine(ita/"+:. 6e cou"d as ourse"(es 'hat 'i"" /e the next !aradi)m0 cou"d

it /e the o!en source societ+< Does it ha(e 'hat it taes< Is it /etter than the o"d one< 6hat chan)es

does it /rin) in societ+< In this !a!er0 'hich is /ased on Riin=s /oo0 'e 'i"" ana"+>e in a irst

!art some o the as!ects o the current !aradi)m0 startin) 'ith the !aradox 'ithin the ca!ita"ist

ideo"o)+0 then some conse;uences o""o'in) the ado!tion o ca!ita"ism in man+ societies around

the )"o/e and ina""+ the rise o the o!en source mo(ement. In a second !art 'e 'i"" ha(e a "oo at

the most im!ortant characteristics o this ne' mo(ement to see i it has 'hat it taes to /e the next

!aradi)m. -ina""+ in the third !art0 'e 'i"" )o o(er the main chan)es that the o!en source

mo(ement can /rin) to societ+0 such as en(ironmenta" and socia" chan)es.


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I2 Current situation

'2 The )arado6 of Capitalism

The ca!ita"ist s+stem is /ui"t on an ideo"o)+ that contradicts itse" e(en in theor+* the initia"

!remise o ca!ita"ism is that in order to ha(e an o!timum or the societ+0 an entre!reneuria"

d+namism o com!etiti(e marets is needed to dri(e !roducti(it+ u! and mar)ina" cost do'n. 1

Accordin) to c"assica" economic "iterature0 the socia" o!timum is achie(ed 'hen the consumers !a+

on"+ or the mar)ina" cost o the )oods the+ /u+. Thereore0 assumin) that this o!timum can /e

achie(ed and maintained0 the economic a)ents 'ou"d ha(e a >ero !roit. No rationa" shareho"der

'ou"d /e 'i""in) to in(est in a /usiness that is not a/"e to !ro(ide a return on their in(estment. In

conse;uence0 economic a)ents 'i"" a"'a+s /e in !ursuit o maret dominance in order to ind

themse"(es in a mono!o"+ !osition that 'ou"d a""o' them to set !rices that are hi)her than their

mar)ina" costs0 'hich 'ou"d in turn a""o' them to ha(e a !roit e;ui(a"ent to a return on the ca!ita"

initia""+ in(ested in the /usiness. This /ein) the case0 the amous in(isi/"e hand o Adam Smith

'ou"d /e in"uenced /+ the economic a)ents that are attem!tin) to )ain a mono!o"istic !osition and

then the 8"aisse> aire: 'ou"d not "ead to the most eicient econom+ o near >ero mar)ina" cost.

This conse;uence is contradictin) the startin) h+!othesis o the reasonin). In mathematica"

ana"+sis0 this is ca""ed a/surd and it sho's that there is an inherent contradiction 'hich under"ies

ca!ita"ist theor+. 5ut is it the case in !ractice as 'e""on contro" B# o the industr+0 and accordin) to a stud+ !u/"ished /+ the edera"

)o(ernment in $4140 in most states0 one e"ectricit+ com!an+ contro""ed $% to %4 o o'nershi!0

and % o the B com!anies contro" #4 o the countr+=s e"ectricit+ !roduction. On the

automo/i"e maret0 our com!anies are "eadin)* Genera" Motors0 -ord0 Chr+s"er and To+ota0 'ho

to)ether o'n B4 o America=s maret. I 'e "oo at the media0 'e ind that i(e com!anies contro"

%# o the maret* Ne's Cor!.0 Goo)"e0 Garnett0 ahoo and iacom. B o the arcade0 ood and

entertainment industr+ is contro""ed /+ CEC FChuc E. Cheese=s Entertainment0 Da(e and 5usters0

Se)a Entertainment0 and Namco 5andai o"din)s. -our com!anies* 6hir"!oo"0 A5 E"ectro"ux0

Genera" E"ectric0 and LG E"ectronics contro" 4 o the maret in the househo"d a!!"iances

1 Rifkin 2014, p.6-7


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manuacturin) industr+. And 'e can o/ser(e the same tem!"ate across e(er+ other maHor sector o

the ?S econom+. The oi" industr+ is the most concentrated0 o""o'ed /+ te"ecommunications and

the e"ectrica" !o'er )eneration and distri/ution. Three o the our "ar)est shareho"din) com!anies in

the 'or"d toda+ are oi" com!anies* Ro+a" Dutch She""0 ExxonMo/i"0 and 5P. Ten /ans are /acin)

u! the hu)e oi" cor!orations* 7PMor)an Chase0 Go"dman Sachs0 5OA0 5arc"a+s Ca!ita"0 ?S50 and

6e""s -ar)o securities. The+ contro" around B4 o the 'or"d'ide in(estment /anin) maret.

?nderneath the inancia" in(estors are %44 'or"d'ide traded com!anies that to)ether sum u!

re(enues o $$.% tri""ion0 'hich re!resents one third o the 'or"d=s GDP. A"" the a/o(e mentioned

!"a+ers are com!"ete"+ and inse!ara/"+ connected to and de!endent on ossi" ue" ener)+0 )"o/a"

te"ecommunications0 and the 'or"d=s e"ectricit+ )rid or their (er+ existence. Accordin) to Riin0

8In no other !eriod o histor+ ha(e so e' institutions 'ie"ded so much economic !o'er o(er the

"i(es o so man+ !eo!"e:. $

In !ractice0 'e can o/ser(e hi)h concentrated marets in the ca!ita"ist societ+ and 'or"d

'ide in the main industries. So 'e can conirm the inherent contradiction at the oundation o the

ca!ita"ist theor+ throu)h usin) em!irica" data rom the ?S and 'or"d'ide. In conc"usion0 a s+stem

that is /ui"t on a /ad inrastructure is destined to ai" sooner or "ater.

&2 Some conse;uences follo4ing the adoption of capitalism in society today

The com!etiti(e marets in the ca!ita"ist societ+ are characteri>ed /+ an entre!reneuria"

d+namism that dri(es com!anies to inno(ate in order to )ain a /i))er maret share than their

com!etitors. Inno(ation is most o the time trans"ated into increased !roducti(it+0 'hich is oten

attained /+ automation at the ex!ense o human "a/or. In his /oo 8The End o 6or:0 7erem+

Riin sa+s 8-ourteen !ercent o a"" the actor+ 'orers in the 'or"d ha(e disa!!eared in the "ast 3

+ears. At this current !roHected rate0 e(en i +ou don=t increase the inte""i)ent techno"o)+ Fin other

'ords "et=s sa+ there is no Moore=s La' here and thin)s Hust ee! )oin) as the+ are0 then +ou end

mass actor+ "a/or 'ithin &4 +ears.:&This 'as ha!!enin) in $44%0 /ut since then0 there ha(e /een

some maHor /reathrou)h disco(eries in ie"ds "ie /ioinormatics0 nanotechno"o)ies0 )enetics0 and

ro/otics. The !henomenon 'as antici!ated /+ the (er+ in"uentia" economist o the t'entieth

centur+ 7ohn Ma+nard Je+nes in 1&4 in his essa+ 8Economic Possi/i"ities or Our Grandchi"dren:.

Je+nes rea"i>ed that ne' techno"o)ies 'ere increasin) !roducti(it+ and "o'erin) the cost o )oods

and ser(ices at a remara/"e !ace. In the same time the+ 'ere )reat"+ reducin) the amount o

human "a/or needed to !roduce )oods and ser(ices. e e(en introduced a ne' conce!t*

2 Ibid., p.54-553 Rifkin 2005, The End of Work


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8techno"o)ica" unem!"o+ment:. This conce!t means that unem!"o+ment stems rom the act that 'e

can more and more easi"+ ind 'a+s o economi>in) the use o "a/or than 'e can ind ne' uses or

"a/or. -or exam!"e0 ne' techno"o)ica" inno(ations in the tenth and e"e(enth centuries in Euro!e

/rou)ht 'ater !o'er to the center o economic "ie. A re)u"ar 'ater mi"" !roduced t'o to three

horse !o'er0 that cou"d re!"ace the "a/or o ten to t'ent+ !eo!"e. 6ater mi""s and 'ind mi""s 'ere

used in (arious ie"ds o industr+* mi""in) )rains0 tannin)0 "aunderin)0 creatin) !i)ments or !aint0

crushin) o"i(es and0 ma+/e the most im!ortant0 the u""in) industr+. 5eore the introduction o the

steam !o'er0 a re)u"ar 'ind mi"" 'as a/"e to !roduce u! to &4 horse!o'er.#Je+nes added that

techno"o)ica" unem!"o+ment0 a"thou)h it mi)ht seem /ad and not desira/"e on the short run0 cou"d

e(entua""+ so"(e manind=s economic !ro/"em. e thou)h that 8a !oint ma+ soon /e reached0 much

sooner !erha!s than 'e are a'are o0 'hen these Keconomic needs are satisied in the sense that 'e

!reer to de(ote our urther ener)ies to noneconomic !ur!oses:%. e sa' a uture 'here machines

'i"" 'or or humanit+ to !ro(ide a m+riad o !ractica""+ ree )oods and ser(ices0 settin) the

human race ree. Men 'ou"dn=t need to 'or to !ro(ide /asic needs "ie ood0 she"ter0 c"othes0 or

e"ectricit+0 and the human mind 'ou"d /e ree to ocus on e(o"(in)0 art0 research or on the ;uest o

transcendence. 5ut is the ca!ita"ist societ+ structure /ui"t in 'a+ that 'ou"d a""o' the ado!tion o

this no/"e ideaation !eriod unti" the irst and second 'or"d

'ars and the Great De!ression disru!ted the !attern. Soon ater the eects o these shocs aded

a'a+0 and the 'ea"th is once a)ain "a+in) c"aim to nationa" income0 'ith (a"ues that a!!roach the

"e(e"s "ast seen /eore the 'or"d 'ars. One o the main conc"usions o his /oo is that 'ea"th )ro's

4 Rifkin 2014, p.345 Kene! 1"30


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aster than economic out!ut. The idea is that the rate o return to 'ea"th is /i))er than the economic

)ro'th rate. A"" other thin)s sta+in) the same0 aster economic )ro'th 'i"" hinder the im!ortance o

'ea"th in a societ+0 and s"o'er economic )ro'th 'i"" increase it. Another h+!othesis is that there

are no natura" orces sto!!in) the stead+ concentration o 'ea"th. The on"+ thin)s that can sto! the

!henomenon are either a /urst o ra!id )ro'th rom techno"o)ica" !ro)ress0 or )o(ernment

inter(ention.B6hi"e a )"o/a" 'ea"th tax seems "ie the )ood so"ution to counter the ine;ua"ities that

the ca!ita"ist societ+ has created0 ado!tin) and a!!"+in) it 'or"d'ide "oos more diicu"t than

/ui"din) cast"es in the air. Cou"d the so"ution come rom techno"o)ica" !ro)ress 'ithin ca!ita"ismero mar)ina" cost and at the o!timum "e(e" o !roducti(it+. 6e=(e

seen that there 'as a contradiction at the core o the ca!ita"ist s+stem and that "eaders o the maret

'ou"d tr+ to !re(ent the !rices to a!!roach >ero and this 'ou"dn=t a""o' the uture 'hich Je+nes

!redicted. 5ut is it !ossi/"e to ha(e an ad(ance in !roducti(it+ that dri(es mar)ina" cost near >ero

'ithout the orces that sto! !rices rom /ein) e;ua" to mar)ina" cost and to reach the o!timum or

societ+in) the !roduction and

insta""ation o c"ean ener)+ /ut a"so the /ans are "endin) mone+ more easi"+ and at "o'er interest

& '(r!, )% 2001" *erner, Tiro+e 2002


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rates to !eo!"e that 'ant to in(est in re"ated !roHects /ecause the+ no' that once the initia"

in(estment is reco(ered0 the mar)ina" cost o !roducin) ener)+ is a"most >ero and the extra re(enue

can /e used to !a+ /ac the "oan. 7ust "ie in the Communication Internet0 the /i) o/stac"e to

o(ercome is the initia" in(estment needed to set u! the inrastructure. Ater that0 the cost o

!roducin) so"ar or 'ind re"ated ener)+ is near"+ >ero. A ne' re(o"utionar+ !henomenon is sur)in)

rom the mer)er o Internet techno"o)+ and rene'a/"e ener)ies. Accordin) to Riin0 Ener)+

Internet 'i"" a""o' hundreds o mi""ions o !eo!"e to !roduce their o'n rene'a/"e ener)+ in their

homes or 'or!"aces and share it 'ith each other o(er the )rid Hust as 'e no' share inormation on

Internet.

6e mi)ht as ourse"(es i Moore=s La' a!!"ies to so"ar ener)+ "ie it did or !rocessors in

the !ast. The ans'er is airmati(e accordin) to an artic"e !u/"ished in $411 /+ the Scientiic

American. Moore=s La' is trans"ated /+ the act that !rocessor s!eeds0 or o(era"" !rocession !o'er

or com!uters0 'i"" dou/"e e(er+ t'o +ears. Gordon E. Moore0 coounder at Inte" Cor!oration0

descri/ed this trend in his !a!er in 1B%140 and em!irica" data sho's that his !redictions 'ere

accurate. I the same !attern is a!!"+in) to so"ar !hoto(o"taic ce""s0 so"ar ener)+ 'i"" /e as chea! as

the current a(era)e retai" !rice o e"ectricit+ toda+ /+ $4$40 and on"+ one ha" o the !rice o 'hat

'e !a+ or coa" e"ectricit+ /+ $4&4.11

-i)ure 1. 8The e(o"ution o the !rice o So"ar Photoo"taic Ce""s:

10 oore 1"6511 (( 2011


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-i)ure $. 8Surace Area Re;uired to Po'er the 6or"d 'ith So"ar Pane"s a"one:

The Germans are !ioneers in the c"ean ener)+ ie"d. In $41&0 German+ had $& o its

e"ectricit+ rom rene'a/"e ener)+ and it=s ex!ected to rise to &% /+ $4$4. The+ aced a (er+

unusua" !henomenon in some !eriods o the da+ 'hen the demand o e"ectricit+ is "o'er* there 'as

an excess o e"ectricit+ in their )rids that im!"ied ne)ati(e !rices. Ne)ati(e !rices or e"ectricit+ has

sho'n u! in other !"aces around the 'or"d "ie Sici"+ or Texas. This chan)es e(er+thin) or the

ener)+ industr+0 in the sense that there is no incenti(e to /ui"d coa" or )as !o'ered !"ants and the

ones that are a"read+ /ui"t 'i"" soon "ose their ad(anta)e. The resu"t is that ossi"ue" !o'ered

!"ants are startin) to /e re!"aced /+ c"ean ener)+.

-i)ure &. 8Surace Area Re;uired to Po'er the 6or"d 'ith 6ind Po'er a"one:


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6e=(e seen the o!en source sot'are and ener)+ mode"s are in !"ace and ha(e /i) !otentia"0

'hat a/out manuacturin)< Is there a techno"o)+ that cou"d a""o' manuacturin) to /ecome o!en

sourcein) meado's. One o the irst restrictions o the a)reement

sa+s that e(er+ citi>en can send to the mountain or summer )ra>in) the num/er o anima"s that he

14 /on!%er! ho prod%e $heir on ood!.


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can eed durin) the 'inter. The commons association meets e(er+ +ear to discuss the )o(ernin)0

re(ie' ru"es0 and to e"ect )o(ernin) oicia"s. The+ can im!ose ines0 or)ani>e and maintain roads0

re!air inrastructure and co""ect ees or the 'or the+=(e done. The ees are !ro!ortiona" 'ith the

num/er o anima"s o'ned. The association is res!onsi/"e 'ith the marin) and cuttin) o the trees

necessar+ or heatin) or construction. Each househo"d is inde!endent0 /ut common inrastructure

"ie /arns or )ranaries do exist.

Tor/e" is not the on"+ exam!"e o successu" co""a/orati(e communities. More than ,4 o

the A"!ine re)ion o S'it>er"and is mana)ed /+ a mixed s+stem o !ri(ate !ro!ert+ or a)ricu"ture

and commons or the use o the 'aste"and orests and meado's. 1%This sho's us that a societ+

or)ani>ed in sma"" co""a/orati(e communities has 'ored and can /e successu". This mode" can /e

ada!ted to the o!en source societ+0 /ut the centra" ;uestion that arises 'hen 'e are tr+in) to ind

out i the o!en source can /e the next !aradi)m is mone+. o' is the inrastructure )oin) to /e

inanceded the /ui"din) o the inrastructure as 'e"" as the industries that

)re' u! around it0 !ri(ate ca!ita" mana)ed to sei>e contro" o the inrastructure and the "e)is"ati(e

and executi(e /odies that re)u"ated it0 es!ecia""+ 'hen Rea)an in the ?S and Thatcher in the ?J

started !ri(ati>in) a"" !u/"ic enter!rises0 'hich continued or &4 +ears. This mode" 'as ado!ted /+

man+ countries a"" around the 'or"d. Toda+ the situation is a s"i)ht"+ dierent0 the inancin) o the

15 )!$ro 1"30


16/28


Internet o Thin)s doesn=t come rom cor!orate shareho"ders0 /ut rom consumers and tax!a+ers.

The Internet has a"read+ connected $.3 /i""ion !eo!"e that !aid or the inrastructure /+ !a+in) the

Internet su/scri!tion to their Internet !ro(iders.1Bo' a/out the ener)+ )ridations that use 6e/

/ased cro'dundin) to insta"" so"ar !ane"s on roos are a"so he"!in) /ui"d u! the inrastructure.

Other non!roit or)ani>ations in underde(e"o!ed areas "ie (i""a)es in India 'here there 'asn=t an+

e"ectricit+ at a""0 can insta"" micro )rids ca!a/"e o )eneratin) e"ectricit+ or the sma"" (i""a)es. Once

enou)h areas are )oin) to /e connected to the )rid0 e"ectricit+ 'on=t /e a concern or humanit+.

Deutsche Te"eom is a"read+ testin) Ener)+ Internet in six re)ions o the countr+0 and other uti"it+

com!anies are current"+ insta""in) h+dro)en and other stora)e techno"o)ies across the transmission)rid. Daim"er is esta/"ishin) a net'or o h+dro)en ue"in) stations across German+ in !re!aration

or the com!an+=s "aunch o ue"ce"" (ehic"es in $413.1,

In the ?S0 the o"d e"ectricit+ transmission "ines are sti"" a/o(e )round0 most o them han)in)

on 'ood deca+in) !o"es. More and more /ro'nouts and /"acouts across 'ide areas in America are

ha!!enin) /ecause o the 'inter sno' storms0 torrentia" s!rin) storms and "oods due to the c"imate

chan)e in the "ast decades. This costs Americans at "east 1%4 /i""ion e(er+ +ear. The ?S

16 I/T 201317 e /+eer 20131& (i+er 2013


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)o(ernment recent"+ too measures to in(est a"most , /i""ion to moderni>e the )rid. Insta""in) a

secure0 di)ita"i>ed0 distri/uted smart )rid under)round 'ou"d dramatica""+ reduce e"ectricit+ "osses

'hi"e increasin) the eicienc+ o e"ectricit+ transmission. The communicationener)+ inrastructure

o the irst and second industria" re(o"utions 'ere inanced throu)h a com/ination o !ri(ate and

!u/"ic in(estment. A !art o the cost 'i"" /e su!!orted /+ the customers under the orm o hi)her

char)es0 the rest o the costs 'i"" /e a/sor/ed /+ the "oca"0 state and edera" )o(ernments in the

orm o su/sidies0 incenti(es and a""o'ances. -ourteen other countries are current"+ im!"ementin)

smart )rids0 and in the maHorit+ o cases0 the Ener)+ Internet is /ein) inanced /+ raisin) the

e"ectricit+ /i"" to consumers and /+ taxes !aid /+ the !eo!"e and irms.1

The !rices o &D !rinters are )ettin) "o'er and "o'er in a ex!onentia" manner. -or exam!"e

the irst "o'cost &D !rinter 'as &4 4440 'hi"e toda+=s hi)h ;ua"it+ &D !rinters can /e ound or

1%44. &D !rinters can !rint their o'n s!are !arts0 the+ are usin) rec+c"ed0 non !o""utin) materia"s

and the+ can /e !"u))ed in an+'here 'here there is a third industria" re(o"ution and Internet Ener)+

in !"ace.

6e=(e seen that inancin) the o!en source inrastructure is !ossi/"e0 /ut ho' a/out the

moti(ation o the !rosumers< 6h+ 'ou"d the+ 'ant to !artici!ateen o the societ+ cou"dn=t

!ossess i(e times more than the !oorest citi>en. Once !o(ert+ and ine;ua"ities e"iminated0 the

mem/ers o societ+ 'ere ree to )ro' and to e(o"(e. The o!en source societ+ is )ettin) us c"oser to

this idea" /+ irst eedin)0 she"terin) and schoo"in) e(er+one on the !"anet. Once this ste! is

ac;uired0 e(er+thin) 'i"" /e a "ot easier and humanit+ 'i"" /e ree to )ro' into a /etter ci(i"i>ation.

In the same 'a+ that someone that is !art o an orchestra that !"a+s a /eautiu" !"a+ achie(es

a /i))er satisaction i the !"a+ is shared 'ith man+ !eo!"e0 than i that !erson "istens to the !"a+

a"one0 the mem/er o the o!en source communit+ 'i"" achie(e a hi)her satisaction and a sense o

reco)nition 'hen he !uts his si""s at the ser(ice o the communit+.

Man in the ancient Gree societ+ dedicated his ener)+ to creatin) /eautiu" thin)s. The idea

is that men can dedicate themse"(es to art ater the /asic needs o e(er+one0 "ie ood and she"ter0

are satisied. 6h+ art< 5ecause art reso"(es disharmonies and ins!ires the consumers o art to do

the same. In the same 'a+ that Shaes!eare=s am"et reso"(es inHustice0 that Picasso reso"(es the

socia" dise;ui"i/rium in his cu/ic !aintin) /+ or)ani>in) disharmon+ in a harmonious 'a+0 manind

can reso"(e the u)"+ disharmon+ in the 'or"d0 the ine;ua"ities0 the hun)er0 the !o""ution0 the

deorestations. The o!en source communit+ has the !o'er to do that0 irst /+ !ro(idin) /asic needs

or e(er+one "ie ree ener)+0 she"ter and ood0 and then ocus on the meanin) o "ie0 creation0 or

)radua""+ reso"(in) the remainin) disharmonies in societ+ to tend to a !erect 'or"d. 5oth in the

ca!ita"ist and in the o!en source econom+ the )oa" is to in(ent and !roduce /eneicia" )oods and

ser(ices or human /ein)s and es!ecia""+ or those 'ho are disad(anta)ed. The ca!ita"ist

entre!reneur is concerned too much a/out sur(i(in) the merci"ess com!etition0 and the conse;uence

is that its !ur!ose shits into the mere creation o a successu" /usiness re)ard"ess o 'hat he

!roduces. The o!en source communit+ 'i"" !roduce 'hat=s needed or societ+ since !roit0 or return

on ca!ita"0 are not an issue.

86hat 'as the )ood o industria" de(e"o!ment0 'hat 'as the )ood o a"" the techno"o)ica"

inno(ations0 toi"0 and !o!u"ation mo(ements i0 ater ha" a centur+ o industria" )ro'th0 the

condition o the masses 'as sti"" Hust as misera/"e as /eore0 and a"" "a'maers cou"d do 'as

25 ++in!on


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!rohi/it actor+ "a/or /+ chi"dren under the a)e o ei)ht


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32 +oundaries to %e esta%lished< )rivacy

A smart !"anet comes 'ith a )reat sense o res!onsi/i"it+. I humanit+ 'i"" create smart

cities a"" around the 'or"d0 it has to create the irst smartinrastructure re(o"ution in histor+. The

inrastructure 'i"" connect e(er+ machine0 /usiness0 residence0 (ehic"e in an inte""i)ent net'or

com!osed o a Communication Internet0 Ener)+ Internet0 and Lo)istics Internet0 a"" enca!su"ated in

a sin)"e o!eratin) s+stem. To mae this s+stem eicient0 smart sensors at e(er+ "e(e" o this

inrastructure are needed. In the ?nited States a"one0 #& mi""ion di)ita" smart meters that !ro(ide

rea" time inormation o e"ectricit+ use are no' insta""ed. It=s estimated that 'ithin 14 +ears e(er+

/ui"din) in the ?nited States and Euro!e 'i"" /e e;ui!!ed 'ith such a de(ice. In $4430 there 'ere

14 mi""ion sensor connection de(ices o'ned /+ humans 'hich 'ere connected to the Internet o

Thin)s. 5+ $41&0 the num/er o these sensors 'as around &.% /i""ion0 co(erin) a"most e(er+ de(ice

that 'e use* Ts0 'ashin) machines0 com!uters0 thermostats0 assem/"+ "ines0 'arehouse

e;ui!ment0 aeria" sensor+ techno"o)ies0 sot'are "o)s0 radio re;uenc+ identiication readers0

'ire"ess sensor net'ors.$3 A"" these sensors are eedin) data continuous"+ to the smart

inrastructure0 and /+ usin) !rediction a")orithms and automated s+stems0 this 'i"" im!ro(e their

thermod+namic eicienc+0 increase their !roducti(it+ and reduce their mar)ina" cost to near >ero.

Predictions sa+ that in the next ten +ears0 $ tri""ion de(ices 'i"" /e connected to the Internet. These

num/ers are a /it scar+0 and !ri(ac+ issues are a"read+ a concern or a /i) num/er o !eo!"e 'hi"e

more and more com!anies are !a+in) a "ot o mone+ to )et inormation a/out consumers. 6hen

e(er+ human /ein) 'i"" /e connected to the smart inrastructure0 'hat /oundaries 'i"" need to

esta/"ished to ensure that an indi(idua"=s ri)ht to !ri(ac+ 'i"" /e !rotected< In the Internet a)e0 third

!arties0 'ith hi)h and so!histicated si""s can !enetrate the net'or in search o inormation that

can /e used or maretin). The !ro/"em trans"ates into ho' to ensure an o!en0 trans!arent "o' o

data that can /eneit the communit+ 'hi"e )uaranteein) that the inormation is not used 'ithout

!ermission and a)ainst the 'i"" o its mem/ers. The Euro!ean Commission has esta/"ished a 'ide

!rinci!"e to )uide a"" uture de(e"o!ments o the Internet o Thin)s. -or them !ri(ac+ and data

!rotection are com!"ementar+ re;uirements or Internet o Thin)s ser(ices and the+ !ro!osed that

mechanisms /e !ut in !"ace to ensure that no un'anted !rocessin) o data taes !"ace and that

indi(idua"s are inormed o 'ho and or 'hat !ur!oses is usin) the data. I am a'are o the

diicu"t+ o turnin) theor+ into !ractice 'hen it comes to inormation o(er the Internet0 /ut I=m

conident that the Euro!ean Commission to)ether 'ith the /est ex!erts0 mem/ers o /usiness

associations0 ci(i" societ+ or)ani>ations and academia 'i"" ind the 'a+.

27 Rifkin 2014 p 73


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=2 $rom o4nership to access

Pri(ate !ro!ert+ is one o the main characteristics o the ca!ita"ist !aradi)m. The c"assica"

economic /e"ie is that human nature is dri(en /+ autonom+ and mo/i"it+ and that e(er+ !erson

'ants to /e so(erei)n o(er a domain. Americans ha(e associated the idea o reedom 'ith

autonom+ and mo/i"it+ and its associated s+m/o" is the automo/i"e. In man+ re)ions o the 'or"d0

more !eo!"e o'n more automo/i"es than the+ o'n homes. The automo/i"e )i(es us the !ossi/i"it+

to tra(e" ree"+ an+'here and re!resents !h+sica" reedom or an+ automo/i"e o'ner. 5ut that=s on"+

an i""usion. As 'e can see in 8The S!irit Le(e":0 6i"inson and Picett ha(e sho'n that in countries

that are (er+ "i/era" "ie ?J and ?SA0 socia" mo/i"it+ is (er+ "o'0 'hi"e in more socia" countries

'here ine;ua"ities are "o'er mo/i"it+ is much hi)her. In the ca!ita"ist era0 humans came to deine

reedom in ne)ati(e terms as the ri)ht to exc"ude. $,

-i)ure # . Socia" mo/i"it+ is "o'er in more une;ua" countries

o'e(er0 the Internet )eneration came to deine reedom in a !ositi(e sense0 as the ri)ht to

share or inc"ude others. -reedom means the ca!a/i"it+ to o!timi>e one=s "ie. -reedom is measured

more /+ access to others in ree net'ors than o'nershi! in !ro!ert+ marets. a(in) access to

socia" s!aces "ie -ace/oo and sharin) /e"ies 'ith the communit+ or 'ith )rou!s that share the

same interests )i(e one=s "ie meanin). -or exam!"e0 in a sur(e+ o dri(ers a)ed /et'een 1, and $#0

2& Ibid. h(p 13


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#B said that the+ 'ou"d choose access to the Internet o(er o'nin) a car. $There is a 'ho"e

)eneration o +oun) !eo!"e that !reer access o(er o'nershi! 'hen it comes to automo/i"es. Car

sharin) has /ecome a (er+ !o!u"ar !henomenon throu)hout the 'or"d. Peo!"e ha(e ounded non

!roit or)ani>ations and autoc"u/s in 'hich the+ !a+ a sma"" mem/ershi! ee that a""o's them to

ha(e access to automo/i"es 'hen the+ need them. Mem/ers reser(e the cars in ad(ance o(er the

6e/ or 'ith a smart !hone a!!. Car sharin) not on"+ reduces the num/er o cars in circu"ation /ut it

reduces the car/on dioxide emissions in the sense that !eo!"e are on"+ )oin) to use a car i the+

rea""+ need it. Other currents "ie /ie sharin)0 "at sharin) and coach sharin) are more and more

!o!u"ar. -or exam!"e0 Air/n/ and omeA'a+ are amon) the man+ startu!s that are connectin)

mi""ions o !eo!"e 'ho ha(e homes to rent. Air/n/ 'ent on"ine in $44, 'ith 114 444 a(ai"a/"e

rooms "isted and ater on"+ three +ears the+ ha(e 1444 rooms e(er+ da+.&4The )ro'th is ex!onentia"

"ie or man+ other o!en source /usinesses.

To+ renta"s ha(e enHo+ed success in the "ast !eriod. Parents no' that chi"dren usua""+ )et

tired o their to+s !rett+ ast and the+ choose to !a+ a sma"" su/scri!tion to a com!an+ that shi!s

them our to ten to+s !er month ater saniti>in) them accordin) to the a!!ro!riate hea"th sae)uards.

A !ositi(e outcome is that the chi"dren "earn that a to+ is not a !ossession to o'n /ut a !"easant

ex!erience to enHo+.

Thred?! is another !o!u"ar redistri/ution or)ani>ation. The+ !oint out that in a(era)e

chi"dren chan)e more than 1&B4 artic"es o c"othin) /eore the+ are 13. The !rinci!"e is that0 'hen

the chi"d out)ro's his c"othes0 his !arents taes a /a) and sends it to Thred?! that inds another

home or the c"oths. 6hen that ha!!ens0 the ami"+ recei(ed a credit that the+ can use to )et other

c"othes or the chi"d. These sharin) /ased economic mode"s are /eneitin) societ+ in so man+ 'a+s.

2" Ibid. p.22630 9pbin 2011


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Conclusion

To see i O!en Source can /e the uture economic !aradi)m0 'e ana"+>ed in a irst !art the

current !aradi)m and some o its /i))est issues. 6e sa' that at its o!timum0 the ca!ita"ist econom+

contradicts its startin) h+!otheses0 and in mature marets 'e a"'a+s o/ser(e a hi)h concentration

o irms contro""in) the marets instead o com!etiti(e maret that 'ou"d /rin) maximum socia"

'e"are. 6e sa' maret ai"ures such as hu)e ine;ua"ities caused /+ dierences /et'een the return

on ca!ita" and the )ro'th o out!ut and income. Another maret ai"ure is sho'n 'hen maret

"eaders in mature sectors sto! inno(ation to !rotect their ca!ita". -rom the !ro/"ems o a d+in)

ca!ita"ist societ+0 the oundation o a ne' !aradi)m is /orn under the orm o se!arate

!henomenons "ie* Ener)+ Internet0 &D !rintin)0 On"ine Education and O!en Source Sot'are. In a

second !art 'e !ut to the test some o the e+ h+!otheses that "ie at the core o the o!en source

!aradi)m=s oundation and 'e under"ine maHor im!ro(ements that it can /rin) to humanit+ i

ado!ted. The ne' !aradi)m "oos )ood 'hen ana"+>in) the inance o its inrastructure and

moti(ation. There is a "ot o 'or to do 'hen it comes to !ri(ac+ and securit+ o inormation. 6e

sa' that it can ix the !"anet and that it can )i(e !o'er /ac to the !eo!"e /+ "ettin) them

!artici!ate in the 'or"d the+ 'ant to "i(e in. O!en source can deinite"+ /e the next economic

!aradi)m /ut it a"" de!ends on us.

This !a!er 'ou"d ha(e /een more exhausti(e i I had access to more data. I ound a "ot o

!a!ers that seemed re"e(ant to m+ research /ut I cou"d not access them. The eects o o!en source

on the maretin) and ad(ertisin) sector 'ere not discussed here /ecause o this reason. Another

"imitation o the !a!er 'as the "imited time a(ai"a/"e to com!"ete the research. I 'ou"d ha(e "ied to

ta" a/out the )ood eatures o the Ca!ita"ist s+stem that ma+/e need to /e e!t /ut ado!ted to the

ne' !aradi)m and a/out the or)ani>ation o societ+ under the ne' !aradi)m. More research shou"d

/e done in Internet securit+ and ho' to mae the transition to the ne' !aradi)m as there 'i"" /e a

!eriod 'here a "ot o !eo!"e 'i"" /e unem!"o+ed and ma+/e 'on=t ha(e the means to satis+ their

most /asic needs.


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