The Zipless Accounting System (thanks, Erica Jong)

An obscure deliberation where our resident mad scientist defines what an accounting system does, in order to describe an instance of  a non-managed, decentralized accounting system.

Because people like money without strings attached.

Open Source – the Impossible Dream

Open source software is an economic anomaly: it shouldn’t be possible. But then, neither should soccer moms. According to economists, all work must be compensated through a managed accounting system or it doesn’t count as real work. Twelve years ago, this point was questioned by Charles Handy, Britain’s foremost business writer, in The Age of Unreason. He pointed out that an immense portion of the useful work in a society doesn’t show up in the GDP*, performed by people who aren’t paid for what they do.

Ever notice that, like the DJIA, the components of the Gross Domestic Product are constantly adjusted, presumably to comprise a market basket of improving indices? Einstein said something like, “We pay attention to the things we can count but don’t matter, and ignore the things that matter, but that we can’t count”

Handy’s point is that we need to be purposely unreasonable in order to do the most-needed things. For support he cites Shaw:

George Bernard Shaw once observed that all progress depends on the unreasonable man. His argument was that the reasonable man adapts himself to the world, while the unreasonable persists in trying to adapt the world to himself; therefore for any change of consequence we must look to the unreasonable man, or, as I must add, to the unreasonable woman.

Unreasonably, not only is Linux gaining ground against capitalism’s poster boy, Windows, and a patchy open source web server (Apache) delivers 66% of the world’s web pages, one of the world’s great software architects, Mitch Kapor, formed the Open Source Applications Foundation last week. Its purpose is to spend no less than $5,000,000 to give away a first class Personal Information Manager. The OSAF web site received 91,000 hits on its first day so obviously something’s going on here. Dan Gillmor thinks this may be just crazy enough to work.

Like Kapor, huge numbers of smart, well-employed people are staying up nights to create something worth giving to others. We on the Xpertweb team may not be in that category, but that’s certainly our purpose here.

Why do economists think this kind of activity is crazy? Maybe it’s because our culture hasn’t developed the vocabulary to put this new gift economy in perspective, though Eric Raymond has described its proportions in The Cathedral and the Bazaar.

When people work within unconventional structures to deliver a product that competes well with products developed under conventional structures, then the structure they use must be acknowledged as relevant. Open source works very well, but it routinely ignores people with money, preferring acknowledgement from the hacker community as its currency. In that sense, it’s aristocratic, though our culture’s taste runs to the democratic. Mitch Kapor is a well-intentioned patron of the software arts, but a patron nonetheless.

Once Kapor’s software is released into the public domain, it will certainly be more responsive to user requests than, say, Microsoft’s code juggernauts, but it’s still not subject to free market forces. How does a real customer, clutching real but limited plastic, get someone to build me that obscure little feature I want? I know there’s someone who can do it before their morning coffee, but where is the democratic market engine to find and reward that hacker?

This is important because, like all artists, programmers like money more than they want to admit.

This design study is exploring that unconventional market engine – one that’s not yet been tried, much less proven effective. Otherwise, this would be a report and not a design study.

Open Resource: If It Looks Like a Duck…

We call it Open Resource. We imagine an unconventional structure which gets people to do things for money, yet leaves out the central feature of all the productive enterprises valued by those dismal scientists called economists: The Accounting System.

I’ve previously suggested that no one has yet figured out how to move money without a central accounting system, but that’s precisely what Xpertweb proposes to do. First we need a test for what a central accounting system does, so we can know when we’ve developed its features, which are technically trivial, and left behind its drawbacks, which are legion.

If any set of buyers and sellers reliably move funds according to published rules, they are implementing an accounting system, whether or not it’s centralized. If, in addition, those participants establish formal financial relationships whereby they reward activities that promote their collective goals, then those helpful activities are rewarded through an accounting system.

It’s a binary question: If the participants reliably and reproducibly match their payments to their promises, they constitute a collective accounting system that’s as effective as any managed centrally. If not, they don’t have an accounting system.

Armed with our test, we may be able to design protocols which inspire people to move money around as effectively as SMTP and POP3 inspire people to move words around.

2:40:14 AM    

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