Category: Political Economy

Konczal on Piketty

There are a number of excellent reviews of Piketty out there; to the 14 Brad Delong collected, I’d add James K. Galbraith and Paul Krugman as well. As a former vox clamantis in deserto, I’m happy to see them. Today Mike Konczal weighs in, with a Foucauldian take:

As Foucault argued, the ability of social science to know something is the ability to anthropologize it, a power to define it. As such, it becomes a problem to be solved, a question needing an answer, something to be put on a grid of intelligibility, and a domain of expertise that exerts power over what it studies. With Piketty’s Capital, this process is now being extended to the rich and the elite. Understanding how the elite become what they are, and how their wealth perpetuates itself, is now a hot topic of scientific inquiry.

Many have tried to figure out why the rich are freaking out these days. Their wealth was saved from the financial panic, they are having a very excellent recovery, and they are poised to reap even greater gains going forward. Perhaps they are noticing that the dominant narratives about their role in society—-avatars of success, job creators for the common good, innovators for social betterment, problem-solving philanthropists—-are being replaced with a social science narrative where they are a problem to be studied. They are still in control, but right to be worried.

Joanne Barkan’s debunking of philanthrocapitalism is part of that story; I’d also expect to see much more reporting from Lee Fang and Republic Report on the tangled interests behind primary challenges and much think tank advocacy. Some may even suggest that children be taught the names of local billionaires, rather than those of the governor and top legislative officials, to understand how politics works. The Pikettian moment marks the inflection point when extreme wealth can’t simply be written off as some ancillary feature of our political economy, but rather, as one of its motivating forces.


Economic Dynamics and Economic Justice: Making Law Catastrophic, Middling, or Better?

Contrary to Livermore,’s post,  in my view Driesen’s book is particularly powerful as a window into the  profound absurdity and destructiveness of the neoclassical economic framework, rather than as a middle-ground tweaking some of its techniques.  Driesen’s economic dynamics lens makes a more important contribution than many contemporary legal variations on neoclassical economic themes by shifting some major assumptions, though this book does not explore that altered terrain as far as it might.

At first glance, Driesen’s foregrounding of the “dynamic” question of change over time may, as Livermore suggests, seem to be consistent with the basic premise of neoclassical law and economics:   that incentives matter, and that law should focus ex ante, looking forward at those effects.   A closer look through Driesen’s economic dynamics lens reveals how law and economics tends to instead take a covert ex post view that enshrines some snapshots of the status quo as a neutral baseline.  The focus on “efficiency” – on maximizing an abstract pie of “welfare”  given existing constraints —  constructs the consequences of law as essentially fixed by other people’s private choices, beyond the power and politics of the policy analyst and government, without consideration of how past and present and future rights or wrongs constrain or enable those choices.  In this neoclassical view, the job of law is narrowed to the technical task of measuring some imagined sum of these individual preferences shaped through rational microeconomic bargains that represent a middling stasis of existing values and resources, reached through tough tradeoffs that nonetheless promise to constantly bring us toward that glimmering goal of maximizing overall societal gain (“welfare”) from scarce resources.

Driesen reverses that frame by focusing on complex change over time as the main thing we can know with certainty.  In the economic dynamic vision, “law creates a temporally extended commitment to a better future.” (Driesen p. 52). Read More

Industrial Policy for Big Data

If you are childless, shop for clothing online, spend a lot on cable TV, and drive a minivan, data brokers are probably going to assume you’re heavier than average. We know that drug companies may use that data to recruit research subjects.  Marketers could utilize the data to target ads for diet aids, or for types of food that research reveals to be particularly favored by people who are childless, shop for clothing online, spend a lot on cable TV, and drive a minivan.

We may also reasonably assume that the data can be put to darker purposes: for example, to offer credit on worse terms to the obese (stereotype-driven assessment of looks and abilities reigns from Silicon Valley to experimental labs).  And perhaps some day it will be put to higher purposes: for example, identifying “obesity clusters” that might be linked to overexposure to some contaminant

To summarize: let’s roughly rank these biosurveillance goals as: 

1) Curing illness or precursors to illness (identifying the obesity cluster; clinical trial recruitment)

2) Helping match those offering products to those wanting them (food marketing)

3) Promoting the classification and de facto punishment of certain groups (identifying a certain class as worse credit risks)

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A Slower Boat From China: Pilotless Ships and Changes to Labor and the Environment

A slower but powerful change is coming to a less familiar part of transportation: shipping. The Economist Tech Quarterly headline on Ghost Ships caught my attention because I know the term from piracy and a script I wrote about the subject. Ghost ships in modern terms refer to ships where a pirate crew has gotten rid of the crew, painted a new name on the ship, and/or set it adrift. The new ghost ships will also lack a crew but for a different reason. The autonomous cargo vessels the article describes are an extension of insights from autonomous cars. The returns to this shift could be as important. Shipping has operator errors: “Most accidents at sea are the result of human error, just as they are in cars and planes.” And costs will come down. Not only would a ship not need a pilot; it may not need a crew.

With pilotless ships, a company could almost eliminate the crew. Costs drop not only for labor but for fuel, because ships could move slower for certain goods. “By some accounts, a 30% reduction in speed by a bulk carrier can save around 50% in fuel.” That saving is lost when paying for people and a ship that has to house and feed people. Plus less fuel burnt should result in environmental benefits. And as the article notes, there is a piracy connection. The human cost of piracy would go down quite a bit. I suppose pirates could still try and take over a ship. But holding the crew hostage would not be an issue and so retaking a ship is simpler. Plus I can imagine that a ship going off course and controlled from afar may be more difficult to commandeer. A pirate might not be able to restart engines or take the ship to destinations unknown. The shore control could have a kill switch so that the ship is useless.

As with my thoughts on driverless cars, the new labor will be those who can operate the ship by remote. A shipping center could house experts to monitor the ships and take over as needed. Instead of months at sea, sailors would be, hmm, landlubbers. Not sure I like the sound off that, but then like has nothing to do with what the future is.

Some Brilliant Thoughts on Social Media

The LSE has a consistently illuminating podcast series, but Nick Couldry’s recent lecture really raised the bar. He seamlessly integrates cutting edge media theory into a comprehensive critique of social media’s role in shaping events for us. I was also happy to hear him praise the work of two American scholars I particularly admire: former Co-Op guest blogger Joseph Turow (whose Daily You was described as one of the most influential books of the past decade in media studies), and Julie Cohen (whose Configuring the Networked Self was featured in a symposium here).

I plan on posting some excerpts if I can find a transcript, or a published version of the talk. In the meantime, some more brilliant thoughts on social media, this time from Ian Bogost:

For those of us lucky enough to be employed, we’re really hyperemployed—committed to our usual jobs and many other jobs as well. . . . Hyperemployment offers a subtly different way to characterize all the tiny effort we contribute to Facebook and Instagram and the like. It’s not just that we’ve been duped into contributing free value to technology companies (although that’s also true), but that we’ve tacitly agreed to work unpaid jobs for all these companies. . . . We do tiny bits of work for Google, for Tumblr, for Twitter, all day and every day.

Today, everyone’s a hustler. But now we’re not even just hustling for ourselves or our bosses, but for so many other, unseen bosses. For accounts payable and for marketing; for the Girl Scouts and the Youth Choir; for Facebook and for Google; for our friends via their Kickstarters and their Etsy shops; for Twitter, which just converted years of tiny, aggregated work acts into $78 of fungible value per user.

And perhaps also for the NSA. As participants in 2011’s Digital Labor conference gear up for a reprise, I’m sure we’ll be discussing these ideas.

Management Wants Precarity: A California Ideology for Employment Law

LaborShareThe reader of Talent Wants to be Free effectively gets two books for the price of one. As one of the top legal scholars on the intersection of employment and intellectual property law, Prof. Lobel skillfully describes key concepts and disputes in both areas. Lobel has distilled years of rigorous, careful legal analysis into a series of narratives, theories, and key concepts. Lobel brings legal ideas to life, dramatizing the workplace tensions between loyalty and commitment, control and creativity, better than any work I’ve encountered over the past decade. Her enthusiasm for the subject matter animates the work throughout, making the book a joy to read. Most of the other participants in this symposium have already commented on how successful this aspect of the book is, so I won’t belabor their points.

Talent Want to Be Free also functions as a second kind of book: a management guide. The ending of the first chapter sets up this project, proposing to advise corporate leaders on how to “meet the challenge” of keeping the best performers from leaving, and how “to react when, inevitably, some of these most talented people become competitors” (26). This is a work not only destined for law schools, but also for business schools: for captains of industry eager for new strategies to deploy in the great game of luring and keeping “talent.” Reversing Machiavelli’s famous prescription, Lobel advises the Princes of modern business that it is better to be loved than feared. They should celebrate mobile workers, and should not seek to bind their top employees with burdensome noncompete clauses. Drawing on the work of social scientists like AnnaLee Saxenian (68), Lobel argues that an ecology of innovation depends on workers’ ability to freely move to where their talents are best appreciated.

For Lobel, many restrictions on the free flow of human capital are becoming just as much of a threat to economic prosperity as excess copyright, patent, and trademark protection. Both sets of laws waste resources combating the free flow of information. A firm that trains its workers may want to require them to stay for several years, to recoup its investment (28-29). But Lobel exposes the costs of such a strategy: human capital controls “restrict careers and connections that are born between people” (32). They can also hurt the development of a local talent pool that could, in all likelihood, redound to the benefit of the would-be controlling firm. Trapped in their firms by rigid Massachusetts’ custom and law, Route 128’s talent tended to stagnate. California refused to enforce noncompete clauses, encouraging its knowledge workers to find the firms best able to use their skills.

I have little doubt that Lobel’s book will be assigned in B-schools from Stanford to Wharton. She tells a consistently positive, upbeat story about management techniques to fraternize the incompatibles of personal fulfillment, profit maximization, and regional advantage. But for every normative term that animates her analysis (labor mobility, freedom of contract, innovation, creative or constructive destruction) there is a shadow term (precarity, exploitation, disruption, waste) that goes unexplored. I want to surface a few of these terms, and explore the degree to which they limit the scope or force of Lobel’s message. My worry is that managers will be receptive to the book not because they want talent to be free in the sense of “free speech,” but rather, in the sense of “free beer:” interchangeable cog(nitive unit)s desperately pitching themselves on MTurk and TaskRabbit.
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Introducing the Talent Wants To Be Free Symposium

Talent Wants to be FreeThis week Concurring Opinions is hosting a symposium on Professor Orly Lobel’s book, Talent Wants to be Free: Why We Should Learn to Love Leaks, Raids, and Free Riding. In simplest terms, Professor Lobel takes on some thorny problems in innovation policy debates including whether to lock down talent and ideas or to embrace the movement of people and knowledge. Though these tensions seem easy to understand, the natural desire to keep what one has means arguments to tie up whatever seems to be giving one an advantage creates larger debates about optimal control and outcomes. Professor Lobel’s work tangles with these core ideas and more.

Professor Lobel is leading thinker on the intersection of employment law, intellectual property law, regulatory and administrative law, torts, behavioral economics, health policy, consumer law and trade secrets as they relate to innovation. She is the Don Weckstein Professor of Labor and Employment Law at University of San Diego School of Law and holds an SJD and LLM fro Harvard as well as an LLB from Tel Aviv University. She is a member of the American Law Institute and the recipient of research grants from the Robert Wood Johnson Foundation, the American Bar Association litigation Fund, the Searle-Kauffman Fellowship, the Southern California Innovation Project, and Netspar, University of Tilburg. We are honored to have her join us for the symposium as our great list of guest authors engage with her book.

Our line-up of authors include Matt Bodie, Anupam Chander, Danielle Citron, Catherine Fisk, Vic Fleischer, Brett Frischmann, Shubha Ghosh, Ron Gilson, Peter Lee, and Frank Pasquale. We look forward to everyone’s contributions.


Global Legal Pluralism

I remember back in 2003, Anupam Chander and I both took part in a cyberlaw retreat on Cape Cod sponsored by Harvard Law School’s Berkman Center for Internet and Society.  Most of the professors assembled at the retreat were concerned with how to “solve” the problems that local regulation of internet activity might pose.  In contrast, Anupam Chander and I repeatedly made the case that this was not a problem to be solved, but an inevitable expression of cultural diversity.  Further, we argued that there might even be some benefits that could accrue from such legal pluralism, properly managed.

We have been fellow travellers ever since, and I am very pleased to see Anupam’s project finally come to fruition in this lively and agile book.  As befits a broadly synthetic work about the electronic silk road, Anupam stiches together an impressive array of examples that convincingly demonstrate the importance of the global trade in services.  In addition, turning from the descriptive to the normative, he lays out principles that might undergird a governance regime for this cross-border activity that leaves open the possibility for multiple competing normative voices.

Anupam’s approach is one that is consonant with the conception of global legal pluralism I have been pursuing for over a decade, and so I have few objections to his account.  Quite rightly, Anupam steers a useful middle ground on issues of so-called extraterritorial regulation.  He neither says that local regulation should always trump all other possible normative authorities (as sovereigntist territorialists often do), nor does he call for a full universal harmonization scheme.  Instead, he adopts a pithy aphorism: “harmonize where possible and glocalize where necessary.”  The key here is that a decisionmaker in a cross-border dispute should always ask whether it is possible to defer to another legal regime in the interests of a harmonious interlocking transnational legal system.  Even asking such a question can, over time, inculcate habits of mind that cause decision-makers to be restrained about reflexively applying their own law in all circumstances.  At the same time, Anupam recognizes that there will be instances when such deference is impossible and local populations will feel the need to impose local norms on cross-border activity.  In such cases, he asks global services companies to “glocalize”: customize their global services product to conform to the law of various localities.

My guess is that such an approach will be workable in many cases, and so Anupam’s argument is an advance.  It is also usefully pluralist in that it leaves space for multiple communities—local international, and transnational—to assert normative authority.  This is in marked contrast to an approach that seeks to elide normative difference and tries to impose a single authoritative set of norms.  Thus, I fully embrace his project.

I do have two quibbles, however.

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Will We Be Ever Able To Go Off-grid Again? And Other Questions about the Electronic Silk Road

Will we ever be able to go off-grid again? What do we gain and lose if not? These questions came to mind as I was reading Anupam Chander’s Electronic Silk Road. The book is excellent. Indeed, these questions and the rest of this post’s ideas would not have come to mind had he not set out how the Electronic Silk Road operates and might operate. And my questions are perhaps prompted by a good book that addresses much and better still opens the doors to the next questions. Chander makes a strong case for benefits of a modern silk road where trust and trade work together and promote “net-work” which he defines as “information services delivered remotely through electronic communications systems.” This two way world facilitates labor shifted to Asia but also Google and Facebook spanning the globe with their services. His plea for new laws to address this change in trade makes sense. Our world of goods is fading to a world of digital things. Yet I wonder whether this new rule of trade maps to all the wonders we may want.

There may be unintentional irony here. Chapter One epigraph quotes Keynes “What an extraordinary episode in the economic progress of man that age was which came to an end in August, 1914!” Does trade stop war or at least make countries less likely to war against each other? Maybe. To get there Chander points out that, “the characteristics that permit net-work trade might be deployed to create a robust infrastructure for such trade: real-time information transfer, low information and other transactions costs, the ability of individuals around the world to collaborate, and electronic identification.” But the same systems that may promote trade can lead to greater surveillance and repression.

In other words, the recent spying amongst countries may be a good thing. I fear greater coordination amongst countries rather than friction. Chander calls this issue “Stalinization—the imposition of the world’s most repressive rules on cyberspace, in aggregated form.” He acknowledges this point at p. 197. Nonetheless this greater connection and improved grid may be inescapable. The idea that local laws must balance global over-reach does not appear to address what happens when the big boys agree. The electronic silk road thus seems to kill the romance of the silk road.

The Silk Road evokes adventure, the ability to test, change identities, and yet somehow trade worked. Failure on the Silk Road or even mistakes or cheating could be hidden by moving from the Road to some other country. In that sense, a modern system of trade on a global scale seems to defeat the room for play that Julie Cohen has described in Configuring the Networked Self. To where would one go to experiment, reinvent, and rehabilitate? Even with greater freedom to communicate things can go awry. A WTO response may be futile if all agree on bad behavior. Public shaming of corporations may mean little when they are forced to comply. To be clear, I agree with much of what Chander offers and have hope that the mitigation he offers will take it root. At bottom it may be a faith that discourse and debate defeats evil in all forms. Part of me thinks this idea is true. Part wonders whether we have come that far from the days leading up to World War I or II. If not, tighter understanding and trade may do less than both Chander and I hope. Then again Chander may be setting us up for the next step in his ideas. I certainly hope so.


Introducing the Electronic Silk Road Online Symposium

Silk Road coverThis week, a great group will be blogging about Professor Anupam Chander’s book, The Electronic Silk Road: How the Web Binds the World Together in Commerce. Professor Chander is a leading scholar on globalization and digitization. He is Director of the California International Law Center and Martin Luther King, Jr. Hall Research Scholar at UC Davis. He has been a visiting professor at Yale Law School, the University of Chicago Law School, Stanford Law School, and Cornell Law School. He is also a dear friend. Nonetheless, it is time for us to do what we hope to do well, and if lucky, our friends do for us. That is, it is time to press Professor Chander about his work as it tries to show us how the new Silk Road operates, what it promises, what is yields, and what it threatens. Work and services are now blending, if not blended. Old rules for trade struggle to adapt to new rules for information. Where will we go from here? Join Professor Chander and our panelists including Paul Berman, Miriam Cherry, Graeme Dinwoodie, Nicklas Lundblad, Frank Pasquale, Pierluigi Perri, Adam Thierer, Haochen Sun, Fred Tung, and of course Danielle Citron and me for the fun this week.