Gift Economies

About twenty years ago I was on a panel at a science fiction convention. The title was "Economics, SF's Weak Spot: So many SF worlds, only two main economic systems. What else might we come up with as theories of value and exchange?" 

The two systems referred to were presumably capitalism and socialism but within those classifications there is quite a wide range of possibilities. The Yugoslav system, for example, while nominally socialist looked rather more like a market economy in which the firms were worker co-ops. The market socialism proposed by Abba Lerner and Oskar Lange in the course of the calculation controversy of the early 20th century was a system in which the means of production belonged to the state but the state instructed the managers to play the game of pretending to be profit maximizing capitalists in order to take advantage of the decentralized control mechanism of the market. The anarcho-capitalist system I sketched in my first book was a market system but not what most supporters of capitalism imagine capitalism to be, since traditional government functions such as defining and enforcing law were entirely private. It has occasionally showed up in other people's science fiction.^¹

Suppose, however, we lump all of those variants into two categories. Are there other alternatives, real or fictional, worth including in speculative fiction? What are they?

There is one that appears in a variety of contexts in the modern world, including science fiction conventions. I was on three panels at that one as well as teaching a class on how to make hardened leather armor. My efforts were not entirely unrewarded; I got a free convention registration and access to the green room, the lounge that SF conventions traditionally provide for their panelists and speakers, which includes a certain amount of free food and, more important, a  chance to interact with some of the more interesting people present. But I get the same reward whether I am on one panel or six, whether I am the organizers' favorite panelist or deemed barely worth inviting. And I did not know in advance exactly what I would be getting, since the terms are determined by custom not contract. I was participating in a gift economy: I do something for you, you reciprocate by doing something for me.

Most summers my family spends two weeks at the Pennsic War, the largest event put on by the Society for Creative Anachronism, a historical recreation organization in which we are long term participants. Over the course of that week I teach ten to fifteen classes on topics relevant to the hobby. As a university professor teaching was how I made my living, but it would never occur to me to charge for these ones or to the people running the Pennsic University to offer to pay me. I do not even charge for handouts, which under the rules I am entitled to do. Their cost is not very large and it feels more appropriate to give them away, to include them within the (medieval) virtue of generosity.

During the same period of time I spend four or five nights, from dark to near midnight, running a bardic circle designed to create the illusion of a group of medieval people sitting around a campfire entertaining each other. Hosting it involves being prepared to present period, at least period feeling, poems and stories to fill as much of the time as is not filled by other performers, maintaining conversation that supports the illusion, offering around period drinks and nibbles, being a host.

If you present a piece that really impresses me, both as a good story and a good job of maintaining the illusion, you will leave with a silver arm ring of my construction. The silver is real; the construction of new rings to replace the ones I have given away the previous year is one of the projects I engage in earlier in the summer. They are modeled on the arm rings given away  by Norse rulers to reward entertainers. Ideally I would like to average one a night but I have never been that lucky.

This again is a gift economy, recognized as such in that context and others by its medieval participants. The same system has existed in many other societies:² Instead of exchanging value for value on pre-agreed terms you give something to someone in the expectation that, although he has no legal obligation to reciprocate, he has a social obligation to. If he does not he will lose status, be seen as a skinflint, almost a cheat. The Elder Edda, a collection of Norse poetry probably dating from the 9th century, contains a poem, Havamal, that is a collection of verses of advice attributed to the god Odin. One of my favorite lines is:

"No man is so wealthy that he objects to receiving a gift in exchange for his gift."

They knew what they were doing.

I am not sure I do. Looking at the institution as an economist it feels like a clumsier way of coordinating human activity than an explicit market. Looking at it as a participant, on the other hand, it feels right. Wandering the web, I came across a comment  by someone who had received one of my arm rings. She referred to it as "one of my most treasured possessions." 

She wouldn't have if she had bought it.

That is one example of an economic system, a way of coordinating human activity, that does not fit neatly into either the socialist or capitalist category.

More on Modern Gift Economies

You invite a friend and his wife over for dinner, enjoy their company, invite them again. Pretty soon they feel an obligation to reciprocate, to invite you over for dinner or, if that is not convenient, invite you to a restaurant and insist on paying the bill. It will never occur to them that they might balance the account by offering you forty dollars instead; you would be shocked, probably offended, if they did.

That is the same system described in Havamal more than a thousand years ago. The transactions are exchanges of value for value but they take the form of nominally voluntary gifts rather than the bargained exchanges of ordinary trade. As an economist I do not have a satisfactory theory of why we do things that way but as a participant I at least know how it feels from the inside.

A second kind of modern gift economy occurred to me in a discussion with a friend whose interests included the history of fencing and 19th century dancing. He routinely spent a week each year teaching the latter at Newport and made his extensive collection of source material on the former widely available as photocopies. He did not expect to get any gifts in exchange. What he did get, in addition to his own enjoyment and the feeling of a useful job done, was status. People sharing his interests recognized his name, treated him as an important person. After his death, Wikipedia wrote:

“In many ways, he himself can be regarded as the father of the modern study of the history of European swordsmanship; it was through the texts he provided that many scholars were first introduced to the importance of martial expression to early modern culture.”

That too is a gift economy of a rather different sort, closer to the gift economy of open source software. You pour your gifts out to the world and the world, if you are lucky, repays you in indirect ways. For a more extreme (fictional) version, consider Gwen Higgins, the mother of the protagonist of Naomi Novik’s very popular (and very good) Scholomance trilogy.

You don’t get any return at all.

That’s not true, at least according to Mum: she insists that you always gain more than you give when you give your work freely, only you don’t know when the return will come and you can’t think about it or anticipate it, and it won’t take the shape you expect, so in other words, the return is completely unprovable and useless. On the other hand, no venture capitalists are lining up to give me rides in their private jets, so what do I know?

That second kind of gift economy is relevant to one of the important issues of the next few decades: How to get intellectual property produced if copyright law becomes, for technological reasons, unenforceable. If I cannot prevent you from copying my book I not only cannot charge you for it, I cannot make my giving it to you conditional, even implicitly, on your giving a gift to me in exchange. I can still get credit for writing it — and may be able to convert the resulting status into other things I value.

I have mentioned in earlier posts Slate Star Codex, the blog I used to spend a lot of time on. The author had a Patreon. I contributed to it. I owed him a debt, both for his own essays and for the creation of the best online conversation I have ever encountered, and wanted to pay it.

1. Most notably in “The Ungoverned” by Verner Vinge, which credits my Machinery of Freedom for the fictional society.

2. I discuss another example in the chapter on the Plains Indians in Legal Systems Very Different from Ours.