The Information Age

VOX

THE STUDENT JOURNAL OF XVIII - Summer 2012 POLITICS, ECONOMICS ANDIssue PHILOSOPHY Published termly by the Club of PEP at the University of York

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Issue XVIII - Summer 2012

THE INFORMATION AGE 1

VOX | The Student Journal of Politics, Economics and Philosophy

Editorial Information changes people. It can take them from a state of nature to a state of order. From oppression to freedom. From being hunters and gatherers just trying to survive to a society that plans its own destiny. It is in this spirit of change that we present this issue of VOX, The Information Age. Not only is this the first issue for the new editorial team, but it also introduces two entirely new sections: Market of Ideas and Interview.

While the former provides the unprecedented opportunity for contributors to challenge each other in VOX, the latter poses important questions to carefully chosen experts.

We begin with the Market of Ideas debate, which asks whether there is a truly free market of ideas in academia, with Paton arguing for a left-wing bias among academics and Iley-Williamson and Ferrer opposing his arguments (p.5). The series of essays is opened by Chiotis, in an article arguing for the mutually-reinforcing character of information and justice (p.19). Then Chipolina, wary of reducing human nature to any single concept of good, brings attention to the importance of intellectual property for preserving essential human rights and freedoms (p.24). Evans centres his line of argument on the emergence of a new economic model arising from the change in information availability and poses relevant questions about the (short-lived) dream of free media (p.28). Finally, Kesvani concludes the section with California Dreams, an article on the entrepreneurial ideology of the 1960s Silicon Valley and its broken promise to liberate humanity (p.31).

We are honoured to inaugurate our interview series with Dr. Madsen Pirie, co-founder and current president of the Adam Smith Institute, whom we respectfully thank for the interesting and genuine answers (p.35).

As this is the first issue of the new team, we would like to thank everyone who contributed and helped in the editing process. We started this editorial by saying that information changes people and hope that our readers will find themselves positively changed by the information contained in this thought-provoking issue of VOX. However, as with Schrödinger’s Cat, it is up to the reader to open it and find out. As ever, do send us your thoughts by emailing vox@clubofpep.org. Details of the next theme can be found at the end of this issue.

Kathrin Eichinger & Madalina Secareanu Editors

Editorial Team Editors: Kathrin Eichinger Madalina Secareanu Layout Editors: Widya Kumarasinghe Tørris Rasmussen

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Sub-Editors: Dominic Falcao Alex Fullerton Rohit Maini James Paton Amna Riaz Judith Weiß

Reviewers: Irina Florea Matthew Kilcoyne Peter Smith External Liaisons: Andrea de Mauro

VOX

THE STUDENT JOURNAL OF POLITICS, ECONOMICS AND PHILOSOPHY

voxjournal.co.uk

ISSUE XVIII - SUMMER 2012

The Information Age MARKET OF IDEAS

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Do We Have a Genuine Market of Ideas in Academic Research?

James Paton, Dan Iley-Williamson & Ieuan Ferrer

ESSAYS

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Information Symmetries as a Prerequisite for Justice Vangelis Chiotis

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Intellectual Property – Right or Wrong?

Scott Chipolina

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The Death of Swedish Piracy and the New Economic Plan Harry Evans

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California Dreams Hussein Kesvani

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INTERVIEW Dr. Madsen Pirie James Paton

VOX is a student academic journal that aims to provide a platform for the exchange of ideas and insight into the debates relating to Politics, Economics and Philosophy (PEP).

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VOX is published triannually by the Club of PEP at the University of York and distributed on York’s campus as well as other universities world-wide.

VOX is available electronically on voxjournal.co.uk and the Apple iBookstore.

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VOX | The Student Journal of Politics, Economics and Philosophy

“Information is the oxygen of the modern age. It seeps through the walls topped by barbed wire, it wafts across the electrified borders.�

- Ronald Reagan

44 Image by G Meyer

Issue XVIII - Summer 2012

Do we have a genuine market of ideas in academic research?

A debate between James Paton and Dan Iley-Williamson and Ieuan Ferrer For the inaugural debate, we have taken up the very issue of the existence of a true market of ideas in academia.

This topic has provided the inspiration for the name of this new section, as it will provide the space for contributors to exchange their ideas and challenge each other in VOX.

James Paton is a secondyear Philosophy, Politics and Economics student at the University of York.

In this issue, Paton, on the one side, and Iley-Williamson and Ferrer, on the other side, advance different views about the ideological foundations of academia and the consequences for the promotion of free thought.

The debators in this issue are presented below:

Dan Iley-Williamson is a third-year Philosophy and Politics student at the Universitiy of York.

James Paton: In our free society with established freedoms of speech, association and press, but do we have a genuine market of ideas? I believe that we have a free market of ideas but in the academic worlds of political philosophy, sociology and in some respects economics, there isn’t a fair game.

Ieuan Ferrer is a thirdyear Philosophy, Politics and Economics student at the University of York.

Academia contains a plurality of opinions. Friedman, Hayek, Miliband, Keynes and Roger Scruton are big names with differing views that have worked in universities. However the ideological balance of academics is of great concern. There is a great left wing presence in British Universities; in a survey conducted in 2004 of British 5

VOX | The Student Journal of Politics, Economics and Philosophy

Market of Ideas Sociology Academics, 90% either Cheng, 2010). However, it is not a described themselves as moderately recruiting biased elite that leads to a or far left (Halsey, 2004 cited by large imbalance; instead they found Saunders, 2011). that those on the In terms of political right choose not “Individuals in their youth voting, only 3% to enter academia vote Conservative tend to hold left wing views on because of the large (Hasley, 2004 politics and economics and peo- left wing presence cited by Saunders, (UC, 2010; Gross ple change their views through2010).

Political and Cheng, 2010: sociology maybe out life; most academics do not p. 21). Those on an extreme case move out of academia, and so the political right but this is true may not find time to change tend not to fight broadly across the this ‘ideological humanities. This is their perspectives on issues ” tide’ but there the ‘establishment’ exists many that do. that has the largest They have found market share in the ideas sector. other ways to express their ideas to It controls a large number of the the market but not through university respected academic journals published published academic journals. by universities and in general the Since the mid 20th century, a number political right are underrepresented in of academic research institutions proportion to the ideological views of involved in in-fluencing governthe public (Gross and Simmons, 2007 ment policy and the world of ideas cited by Gross and Cheng, 2010). have become home to centre-right A question to ask is how has this thinkers. Competing for the attention come about? Research by Gross and of government as well as ideological Cheng found that it could be due to pride to the solutions to economic, many professors forming their opinions political, socio-logical and other at an early age and not changing them. problems, this meets the criteria of a Individuals in their youth tend to market of ideas. hold left wing views on politics and These inst-itutions in comeconomics and people change their parison to uni-versities are far less views throughout life; most academics resourced and funded, as they have to do not move out of academia, and raise funds through charitable status so may not find time to change their instead of state funding. The Institute perspectives on issues (Gross and of Economic Affairs founded in 1955 6

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Market of Ideas

by F.A Hayek and others promoted after the Mrs. Thatcher enacted freefree market ideas that attempted to market and privatization reforms. influence political debate and move His switch from left to right led to a the academic deterioration of his argument right.

“Humanities departments at academic career; They have behe no longer was come outlets universities must become more on editorial boards for disgruntled reliant on private funds to cre- for journals, was academics that ate a fairer market in academic not invited back find it incredibly as an external difficult to be research. It will be difficult to examiner for published within achieve, but if we want to see a other universities ‘ r e s p e c t e d ’ genuine market with no special and lost funding academic journals privileges, funding must be re- for his research through ‘peer (Saunders, 2011). viewed” review’.

He notes: Peter Saunders, Emeritus Professor of Sociology at As an academic in Britain, I was Sussex University experiences confirms censored by the process of peer review… this point. Originally a member of the But writing for think tanks…I am not Labour party and centre-left academic, censored at all. I write what I want, and he changed his ideological position if they sympathise with what I am saying, Photo by: Renau Camus

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Market of Ideas they publish it. If one think-tank doesn’t like it, another will take it, for I now operate within a genuine free market in ideas (ibid).

The move of academics publishing work within think tanks rather than in peer-reviewed university journals created snobbery within the profession. Those who are apart of the establishment review the top academic journals and use their power to demarcate what is ‘academic’ or not.

This is ‘academic licensing’. This is evident with the debate over the Spirit Level: Why More Equal Societies Almost Always Do Better. Pickett and Williamson refuse to debate the critics’ work if it hasn’t adequately ‘peer reviewed’ (Jump, 2010 cited

by Saunders, 2011). They can use their protected positions to dismiss opponents that come up with wellfounded critiques, as they are part of the establishment that sets the criteria and reject it as a purely ideological polemic attack. The establishment uses its ‘official status’ to undermine other ideas.

The main issue that we have is unequal funding. The establishment is much better resourced than think tanks and independent academic researchers. In a genuine market, research institutions, whether they run for profit or not must raise their own funds from trusts, private donations, alumni, student tuition, fixed income investments and research that is sold 8

onto the market. To gain a reputation, they must have a high quality peer reviewing process to attract the customers, donations and funding to keep researching.

“To create a genuine market of ideas ... we need to seriously review state funding of university institutions.”

To create a genuine market of ideas in academic research and avoid ‘academic licensing’, we need to seriously review state funding of university institutions. Humanity departments at university must become more reliant on private funds to create a fairer market in academic research. It will be difficult to achieve, but if we want to see a genuine market with no special privileges, funding must be reviewed.

Bibliography

Gross, N. & Cheng, C. (2010). Explaining Professors’ Politics: An Indirect Test of the SelfSelection Hypothesis. Available at: http://bit.ly/ K9zo3O Saunders, P. (2010). Social Mobility Myths.

CIVITAS Saunders, P. (2011). Academic Sociology and Social Policy Think Tanks in Britain and Australia: A Personal Reflection. Sociological Research Online, 16(3) 10 University of Copenhagen (UC) (2010).

Academics are left wing reason study shows.

University of Copenhagen. Available at http:// universitypost.dk/article/academics-are-leftwing-reason-study-shows

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Market of Ideas Dan Iley-Williamson and Ieuan Ferrer: Paton identifies something that, were we of a similar political bent, we would be eager to account for: if libertarianism is the correct ideological position, why is it the case that those whose job it is to think about such matters – political philosophers, sociologists, etc. – are almost entirely of the liberal-left? Indeed, in spite of much heated debate amongst contemporary political philosophers (a lot of hot air, one might think) the only real notable exception to liberal left-wingery in recent times is Robert Nozick,1 who, again notably, has no significant ‘free market’ inheritors. (Paton may be eager to point to the likes of Mises, Hayek, or Friedman – we, arrogantly, dismiss these ‘philosophers’ out of hand.) The libertarian is therefore bound to wonder why ‘the left’ has such a stranglehold on the academic establishment (or as Paton somewhat oddly calls it, ‘the establishment’). The only direct answer Paton attempts to give to this is that academics, having formed their opinions at a young age and following the left-wing caricature 1 Those dubbed communitarians – Sandel, MacIntyre, Taylor etc. – would, for all intents and present purposes, fall under this heading as they do not subscribe to the ideology of ‘free’ markets. Someone like Michael Oakeshott, who might be a hoped-for ally, in fact rejected Hayekian ‘rationalism’. See Rationalism in Politics and other essays, p. 26.

of the young, ‘may not find time to change their perspectives on issues’. Yet this explanation – this ‘theory of error’, as one might call it (i.e. an explanation of why people have got something wrong) – is, at the very least, highly counter-intuitive: those whose job it is to think about how society should operate (i.e. political philosophers) do not, we are told, have enough time to think about how society should operate… A most bizarre conclusion, one whose falsity can be accounted for in our very own theory of error – Paton, desperate to account for the left-wing ‘bias’ of academics, because he rightly sees that a theory of error must be given to safeguard his ideological position, seizes anything available, paying little attention to the plausibility of the account. (It should be briefly noted that we are not saying that because it is the job of political philosophers to think about how society should be organised, they are therefore right in their conclusions; we are simply saying that Paton’s explanation of why left-wingery is so prevalent among academics is clearly a very implausible explanation. Our explanation, briefly and unsurprisingly, is that some form of left-wingery is the proper response to modern societies and the problems they face, and so it is hardly surprising that those whose job it is to think hard about these matters tend to reach such conclusions.)

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Market of Ideas Perhaps a better libertarian theory of error can be found. F. A. Hayek, writing in the late nineteen-forties, accounts for the prevalence of socialism in university faculties by saying that it is because those dissatisfied with ‘the present order’ are likely to want to influence public opinion, and hence pursue an academic option, rather than embracing the present system

“If libertarianism is the correct ideological position, why is it the case that those whose job it is to think about such matters – political philosophers, sociologists, etc. – are almost entirely of the liberal-left?” and pursuing the ‘multitude of other avenues’ (Hayek 1949, p. 379). This, however, also seems implausible, so long as we take libertarians at their word. This is because, as Hayek would go onto argue in The Constitution of Liberty, and had already argued in The Road to Serfdom, libertarians have many reasons to feel ‘dissatisfied’ with the present order, given the – what seems to them – overbearing influence of the state in ‘interfering’ with our lives and meddling with our (economic) ‘liberty’. If they are genuinely dissatisfied with this arrangement (and if they are not, actually, just laughing all the way to the (state owned) bank),

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then Hayek’s theory of error also falls away.

If what we say is thus far accepted, much of Paton’s argument collapses – he no longer has a libertarian-friendly explanation of why academics are, on the whole, left-wing; and so he longer has such an account of why such academics have managed to dominate ‘the establishment’. We hope, therefore, to have cut-off the branch upon which he was sitting. In what follows we hope to paint a more accurate picture of what a desirable ‘market of ideas’ would look like, and unsurprisingly, it is a quite different picture to Paton’s ‘free’ market of ideas, as we shall attempt to show.

Paton’s ‘market of ideas’ corresponds to an economic market.

In it, research institutions would have to raise their funds from private donations. Their research is then ‘sold’ to the market, meaning that they must tailor their research to their ‘customers’ (those paying for it). It hardly takes much reflection to consider what this would amount to. Those able to pay for research – the economic elite – would buy self-legitimating ‘academic’ work. Those unable to fund research institutions – the economically deprived – would be left without a voice, for under such arrangements a voice would amount to the ability to raise money (and there is no reason to think that money and ‘the right

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Market of Ideas political ideas’ would follow a similar course; in fact, there are good reasons to think financial self-interest would take precedence, thus obscuring ‘the right political ideas’). Such considerations are supported by rational choice theory – a branch of political theory that takes as its base assumptions that humans are a) self-interested and b) rational. Although public choice theory does not have a monopoly on truth when it comes to predicting human behaviour (Hindmoor, 2010) – our altruistic tendencies may lead to the establishment of some charitable trust funds (e.g. Joseph Rowntree Foundation) – we do not share the libertarian’s confidence that such foundations would be sufficient to counteract the dominance of the thinly disguised pro-rich propaganda.

Even under current arrangements, who funds the plethora of ‘free’ market think tanks? (There are no prizes for guessing.)2 Paton describes his proposed arrangements as ‘fair’ (for, one must suppose, the outcome of ‘free’ markets must necessarily be ‘fair’). Doubtless 2 At the risk of causing a collective groan amongst libertarians, see George Monbiot’s piece on this topic: http://www.guardian. co.uk/commentisfree/2011/sep/12/thinktankscrushing-democracy-pr-agenices. If society were significantly closer to financial equality, such an economic market would be less (though still) unjustifiable. However, we highly doubt that this would be a price Paton would be willing to pay.

such arrangements would be ideal for libertarians, but there is little reason to think a market of this sort would produce an environment conducive to ideas being discussed in a fair way, as we shall elaborate in our conclusion.

In an economic market of ideas (as with all economic markets), one of the key forces that drives the spread of knowledge is not necessarily accuracy

“In an economic market of ideas (as with all economic markets), one of the key forces that drives the spread of knowledge is not necessarily accuracy or truth, but profitability and the pursuit of dominance.” or truth, but profitability and the pursuit of dominance. (Just think of the Murdoch media empire as an example of the latter and the sensationalism of many newspapers (his especially) for evidence of the former.) This creates a high volume of ‘noise’, where ideas are ‘picked out for reasons that need nothing to do with their truth’ (Williams 2002, p. 215). This results in a system that gives no necessary weight to ‘truth-acquiring’ processes (ibid, p. 214). An ‘idealised market’, in contrast, might approximate to one where, not everything is said, ‘but everything worth saying is said’ (this is Alexander Meiklejohn’s

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Market of Ideas recommendation, quote in ibid, p. 218). This would require more interventionist policies – including the regulation of media, party funding and – heaven forbid – university licensing.3 It also requires some sort of arbiter to decide upon what is ‘worth saying’, but there is no reason to think that the economic market would produce a fairer or more truthful arbiter than a government kept in check by a critical and engaged public.

This alternative proposal helps to correct the deficiencies of Paton’s economic ‘market of ideas’. We have focused, due to length constraints, on the more overt communication of ideas (that which occurs in universities and the media). Yet an even more pervasive form of action guiding dissemination is that which is produced by the capitalist economic system; that is, the ubiquity of advertising which furthers the consumption of ever more goods and services. Such outcomes are the product of profit-driven companies, and it is the inevitable consequence of a capitalist economic system. One cannot ignore its consequences.

Indeed, one might be tempted to say that one ought to be dismayed by its consequences.4 A libertarian 3 For a similar proposal, developed at greater length, see Dworkin’s Is Democracy Possible Here?

4 Heavy exposure to advertising is linked to a materialist world view, and low life satisfaction (Atay et al., 2009; Speck & Roy, 2008; Abela, 2006).

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may respond that this is the result of individuals’ ‘free’ choices. This may, in a sense, be not too far from the truth (although in important and relevant respects, it is certainly not true). Even so, there is no good reason to think that the accumulated result of individual choices within a capitalist economic system produces a morally good society, or even a society in which one would want to live. There is, however, good reason to think that a society that is willing to regulate itself in certain ways can produce a fairer and, even, culturally richer society.5

“There is, however, good reason to think that a society that is willing to regulate itself in certain ways can produce a fairer and, even, culturally richer society.”

Bibliography

Abela, A.V. (2006). Marketing and consumerism – A response to O’Shaughnessy and O’Shaughnessy. European Journal of Marketing, 40(1-): 5-16.

Atay, E.G., Sirgy, M.J., Cicic, & Husic, M. (2009). Extending the Research in Relation to Materialism and Life Satisfaction. Advances in Consumer Research, 36: 225-232.

5 Libertarians, on occasion, turn to (crude) subjectivism at this point. A moment’s reflection, however, would reveal that a libertarian, and any sensible person, would want to avoid the pitfalls of such an option.

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Market of Ideas Dworkin, R. (2006) Is Democracy Possible Here? Oxford: Princeton University Press Hayek, F. A. (1949) The Intellectuals and Socialism. The University of Chicago Law Review Hindmoor, A. (2010). ‘Major Combat Operations Have Ended’? Arguing about Rational Choice. British Journal of Political Science, 41, 191-210.

Speck, S.K.S. & Roy, A. (2008). The interrelationships between television viewing, values and perceived well-being: A global perspective. Journal of International Business Studies, 39(7): 1197-1219.

Williams, B. (2002) Truth and Truthfulness.

Oxford: Princeton University Press

“This not only reveals an extraordinary lack of critical, reflexive, sociological imagination. It also demonstrates a depressing ignorance of how think tanks work (Saunders, 2011)” James Paton: I thank Iley-Williamson and Ferrer (henceforth: my opponents) for responding to my initial argument.

They have raised a number of important issues that must be addressed.

First let me address the ‘theory of error’. There is a second explanation that ties within the first that can help strengthen my position. Nozick and Rothbard both argue that intellectuals ‘tend’ to feel undervalued by the market

system as the market undervalues their worth in reward through wages in comparison to entrepreneurs (Nozick, 1998). This is largely to do with the reward structure of education system, and at school, those who are praised are the most intelligent. In the market, those who are praised are not necessarily to do with their academic ability, but the skills they can sell to the market. In this reformulation, those who ‘tend’ to be more academic ‘tend’ to be hostile to capitalism as it is because it does not ‘reward’ their abilities. Envy and bias are apparent in life (especially polarization bias), and this is true in academia.

Now I must respond to a number of bold claims made by my opponents.

The first is the issue of private sector money and the ‘rich individual interests’ argument.

A quote by Peter Saunders, an academic who I mentioned in my last article will help me illustrate my following points: Others dismiss my work as ideologically contaminated on the grounds that I am funded by private sector money. They assume that small, independent think tanks which have to raise all their own funds must be compromised, but that people like themselves, who depend for their entire lives on tax revenues raised and distributed by the state, have no ideological axe to grind. This not only reveals an extraordinary lack of critical, reflexive, sociological imagination.

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Market of Ideas It also demonstrates a depressing ignorance of how think tanks work (Saunders, 2011).

In the market of ideas (and in general, in my opinion), there is a difference between private funding and public funding of research institutions.

A private donation consists of an individual voluntary giving, whereas a public subsidy is through taxation.

Private research institutions are more accountable to donors and must keep producing quality ideas.

I am assuming here that my opponents ‘idealized’ markets model is funded through the public purse.

Special interest groups capture public funding and this consolidates their position. They are not accountable as a private research institution as donors

“The Internet has opened up the market of ideas where more people than ever can access information to research. The ‘economic elite’ cannot compete against this...” and funders of their research keep a check on the quality of work that has been produced. If a private think tank started to produce poor ideas, and another like-minded institute appeared producing similar but better ideas, big donors will shift their funds away from the think tank that was facing decline.

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In public funded institutions, this mechanism does not exist to the same extent. Competition can drive out badly thought out academic ideas and work if it isn’t well argued; it cannot however when there is a consolidated special interest group.

My opponents have also implied that business will bank roll the right wing institutes, and leave the left viewpoints without a ‘voice’. I have a number of responses to this claim. First, can the ‘economic elite’ compete against the millions of market participants? Look at the presidential campaigns in America and the sites where individuals can donate for underfunded computer programmers.

The Internet has opened up the market of ideas where more people than ever can access information to research.

The ‘economic elite’ cannot compete against this and media empires such as News International are seeing their influence dwindle because of the Internet and a plurality of news sources available to consumers.

Second, I argue that where university institutions tend to lean towards the centre-left, state funding ‘crowds out’ private donations to centre-left research institutes as they are already well funded. The centreright found this was the case, and set themselves up in private institutions.

I believe that if we withdrew state funding for them, we would see the rise of new institutions to compete

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Market of Ideas against opposing centre-right ideas. and poorly thought out claims would Combined with the Internet, and the be put to bed. decentralization of funding, all sorts As Saunders notes above, it is of ideas from all wrong to suggest over the political “This is how truth is found that private sector spectrum would used to and poorly thought out claims isfuelbeing have a voice. an ideological To remind would be put to bed.” axe for academics the reader of the to grind. Spin the above quote, my opponents have question the other way round, and argued that noise or distortion would ask whether publicly funded interest lead to ideas ‘picked out for reasons groups have an axe to grind? Of course that need nothing to do with their they do, and it is myth to believe that truth’. Big private state money is sector money as ideologically I have argued neutral.This would not lead to brings me onto such distortion my last point. in an open My opponents market, as there have argued would be healthy that we need competition an arbiter or between competing regulator. Why parties competing do we trust for funds and for university the best ideas. a c a d e m i c The issue with the journals even debate on the Spirit Photo by: dallashangerphoto if they are paid Level is debating statistics and whether for by the state, but not private think there has been statistical bias applied. tanks? Special interest groups can The issue that I have argued in my first capture the regulator and this is the response is that academic licensing issue I have raised earlier. Instead, has been applied and the debate shut marketization is the best way to signal down by an interest group. This is not to the market ideas what is the best healthy competition and the whole academic work. This is social capital point of an open market is to analyze and the market does this very well (See and deconstruct the arguments of the Meadowcroft and Pennington, 2007). opponents. This is how truth is found Brands indicate what is the best quality

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Market of Ideas work and institutes have to upkeep high quality research and peer review.

They must be innovative to maintain their brand.

This is already the case for academic journals, where some are known to be more prestigious than others. In a market, a research institute must upkeep its brand and if it becomes complacent, they will feel the withdrawal of funding from large and small donors, and people who buy their work. Incumbent positions in the market do not last forever. To conclude, an idealized market that would have regulation and would not be free (in my understanding of the term of free markets) would ultimately lead to the situation that we are in now, where special interest groups have captured public funds. I have argued my model is not deficient, and instead argue that an ‘idealized’ market is truly deficient as the intervention from government in the market distorts the market of ideas.

Bibliography

Meadowcroft, J. & Pennington, M. (2007).

Rescuing Social Capital from Social Democracy.

Institute of Economic Affairs Nozick, R. (1998). Why Do Intellectuals Oppose Capitalism? Cato Policy Report. Available at: (http://www.libertarianism.org/publications/ essays/why-do-intellectuals-oppose-capitalism) Saunders, P. (2011). Academic Sociology and Social Policy Think Tanks in Britain and Australia: A Personal Reflection. Sociological Research Online, 16(3) 10

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Dan Iley-Williamson and Ieuan Ferrer: Paton points to Saunders’ argument regarding the biased incentives public sector funding induces in the market of ideas. However, a close reading of the Saunders quote reveals that he is accepting that funding by the private sector also presents skewed incentives. We would argue that the incentives caused by the public sector are importantly different from those caused by the private sector, and that the public influences are more benign.

Imagine, for instance, a researcher for the Adam Smith Institute (ASI), a ‘free’ market think tank, writing the following: “Civil government, so far as it is instituted for the security of property, is in reality instituted for the defence of the rich against the poor, or of those who have some property against those who have none at all” (Adam Smith, 1999: 302). In echoing the words of the ASI’s supposed hero, what would happen to our imagined researcher? We fear her honesty would quickly leave her out of a job. This brings out an important factor that private sector funding introduces, what Paton calls ‘accountability’. We, however, would call it dependence – dependence on a certain set of private sector interests. Research produced by organisations like the ASI does have to be above a certain standard – it has to pass a credibility test. However, the most important factor, in our view,

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Market of Ideas is the institution’s inability to stray beyond a very narrow ideological band (the growth of alternative, leftwing, think tanks is here largely an irrelevance – the relevance is the loss of independency).

The interests of the public sector, however, are set-up and communicated in very different ways to that of the private sector. Marsh, Richards and Smith (2003) have developed the Asymmetric Power Model of British politics – modelling British politics as preserving a great deal of power in Westminster and Whitehall, but also as being influenced by a wide array of less powerful actors, including taxpayers.

This provides us with reasons to believe that state action represents the interests of the people, to some extent. Furthermore, this confluence of influences, especially given that the parties in government change, means that the dominant narratives in the public sector changes; the British political system is not always geared to increasing its own size and influence.

Furthermore, even if the balance of influences in Westminster is tilted towards the increasing of the size of the state, the way that these influences are communicated is through a great deal of layers of bureaucracy. Lots of civil servants, people working for quangos and experts, whose job it is to remain impartial, stand between government policy and individual funding decisions. These factors all suggest that

the influence of public sector funding is more benign than that of private sector funding.

We are also asked to look at the funding of political parties, which will supposedly demonstrate how the economic elite cannot ‘compete against the millions of market participants’. Yes, we respond, look: to take an example close to home – the funding of the two main UK

“Money gives louder voice...”

one

a

parties in the election year of 2010 – nearly £10 million was donated to the Conservative Party by a variety of companies (just under a third of their total donations received), compared to the Labour Party receiving under £2.5 million (just over a tenth of the total they received).6 One might respond by saying that Unions, not individuals or companies, are the backers of Labour, and so the same brush similarly tars them. This, however, is to forget the Unions represent thousands, if not millions, of members (Unite, Labour’s biggest donor, has roughly 1.5 million members). In contrast, companies, or very rich individuals, merely represent themselves, which 6 See http://action.unlockdemocracy.org.uk/page/-/ publications/Donations%20Report%20Q4%20 2011.pdf

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Market of Ideas is to say, they represent a very small number of people – an elite. We make this point to substantiate what we have already argued: that the wealthy have more power to determine political action; they can, effectively, purchase ideological argument (whether that be from a political party or a think tank).

This can be expressed via the metaphor we have already used: that money gives one a louder voice. If, therefore, there is an economic market of ideas, wealth has great power in determining the direction of thought. This, we think, is clearly unjust, and more to the point, it fails to represent what one wants from an ideas ‘market’ (see our first response).

We also note that Paton has not responded to our broader point regarding advertising. Perhaps he does not recognise this as a point against him. We would like to reiterate our belief in the importance of the wider market of ideas, including the press, public discourse and advertising. It does not seem that there is a leftist bias when the market of ideas is looked at from this perspective.

We conclude on the point on which we started: the libertarian’s desire for what we have called a ‘theory of error’. Paton’s new theory of error states that because the market does ‘not necessarily’ financially reward7 7 He in fact uses the word ‘praised’, but this is presumably what he means.

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those with ‘academic ability’, the academically inclined tend to feel resentment towards the market system and those who the market does reward: those who have the ‘skills they can sell to the market.’ This argument, however, faces a worrying dilemma: Paton can assert this to be the case, thus providing himself with the much needed branch upon which he can sit (to return to the earlier metaphor), but only at the cost of undermining his argument. For if what Paton here says is true, he is admitting that there is no necessary reason to think that the market will value academic ability; instead it will value the product as a whole (which, we have contested, will be largely determined by the ideological content, not the academic rigor). This is the first horn of the dilemma. The second horn can be easily seen: if Paton wants to argue that the market does, in fact, properly value academic ability, then this undercuts the theory of error – this time it is he, not us, that cuts off the branch upon which he sits. Consequently, it is either his argument that is abandoned, or his theory of error.

Bibliography

Marsh, D., Richard, D. & Smith, M. (2003).

Unequal Plurality: Towards an Asymmetric Power Model of British Politics. Government and Opposition, 38(3): 306-322.

Smith, A. (1999). The Wealth of Nations: Books VI-V. London: Penguin

Issue XVIII - Summer 2012

Information Symmetries as a Prerequisite for Justice

By Vangelis Chiotis The purpose of this essay is to discuss the link between information availability and justice as mutual advantage. The concept of justice as mutual advantage is based on rationality. In turn, fully rational agents are completely informed agents with consistent preferences given a stable environment. Even when this strict definition of rationality does not apply, any broader understanding of rationality requires agents to possess some information about others and their environment. Therefore, information availability is paramount for rationality. Agents with different amounts of information can be said to be unequally rational. Their ‘rational’ behaviour differs since their rational deliberation has different basis and so leads to different conclusions. Theories of justice as mutual advantage are based on the assumption that individuals are rational maximisers. Thus, there is a connection between available information and the possibility of justice as the outcome of interactions between rational individuals. It has to be clarified that information availability and information will be used interchangeably; rational utility maximisers are assumed to possess the same means to retrieve information

and the same mental capacity to process it. Therefore, information is equally available to all and there is no need

“Any broader understanding of rationality requires agents to possess some information about others and their environment.

Therefore, information availability is paramount for rationality.” for a distinction between information availability and information. In the following paragraphs, I will examine the relationship between justice as mutual advantage, rationality and information availability, followed by a discussion of the role of information in the definition of rationality. I will begin with a discussion of justice as mutual advantage and its intrinsic connection to individual rationality. This will be followed by looking at how rationality requires information availability. The final paragraphs will deal more directly with the question of how information availability promotes justice.

Justice as mutual advantage requires and assumes rational agents; it “begins 19

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with fully informed individuals...who are driven to pursue their own selfinterest” (Matravers 2000, p.156). An agent is expected to participate in an interaction only if she expects to benefit from it. If all interacting agents do the same, there will be a set of interactions that promote each individual’s benefit and therefore the common good. However, the assumption of rationality is not as important for justice as mutual advantage as the one of equal rationality. If one agent cannot take advantage of others because of a type of hyper-rationality, then agents who do not behave strictly rational do not affect the structure of a theory of justice as mutual advantage.

Justice as mutual advantage describes a bargaining procedure between rational individuals that leads to a commonly accepted outcome. Both agents have more to gain by participating in the cooperative procedure than they lose by constraining their self-interest. Justice as mutual advantage assumes that individuals with conflicting interests participate in the production of a “cooperative surplus” (Gauthier 1986, p.130) which is mutually beneficial (Barry 1991; Vanderschraaf 2011).

Given rational agents and absence of coercion, all voluntary interactions should lead to just outcomes. Hence, the connection between justice as mutual advantage and individual rationality is rather straightforward.

Rationality, broadly understood, is based to a large extent 20

on the availability of information. In game theory, information asymmetries describe interactions where one agent has more information than the others (Akerlof, 1970). Rational deliberation in this case will lead to different strategies. All parties attempt to maximise their utility but because of information asymmetries their actions will differ and only those with perfect or more accurate information will have maximised at the end of interactions.

Therefore, in order to have a meaningful description of rational interactions in a game theoretical framework, it is essential that information is available or that there is insurance for those with less information. Put differently, information availability is essential in order to describe interactions between rational agents. Varying availability of information affects rational behaviour and creates inequalities that cannot be compatible with the premises of rational choice theory, no matter how broadly defined. This does not mean that rationality is reduced to information availability; however, information availability is the essential component of rationality. And freely available information should lead to agents of equal rationality.

Equally available information is not an idealised account of information; it is plausible to assume that individuals within a society have or can have access to the same information. Especially with the Photo by: Eric the Fish

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increased availability of information information so as to ensure ‘equal technology and the internet, rationality’. Therefore, the account information has been becoming more of rationality used here is not the readily available and one can be more traditional economic rationality, but hopeful that the trend will continue a bounded rationality which refers to to the point where the vast majority making the best decision given realistic of people within a given society will constraints on information, predictive have access to very similar information power and memory (Binmore in terms of quality and volume. The 1998;Young 2001;Gintis 2009). decentralised structure of the internet Information refers both to by comparison to traditional sources information about available strategies of information helps the avoidance and information about others’ past of information behaviour.

The availability former ensures “The internet has made near rationality asymmetries. in The internet has ideal economic markets a possi- that each agent made near ideal the bility, if not a reality; a consum- knows economic markets possible actions a possibility, if er that is willing to search for that maximise not a reality; a relevant information is bound her behaviour; consumer that is to find the best deal. In the near the latter ensures willing to search that agents future the same can be true for for relevant choose whom information is the political marketplace and they interact bound to find beyond the westernised world” with rationally. the best deal. In For instance, the near future in a typical one the same can be true for the political iteration prisoner’s dilemma, one has marketplace and beyond the westernised the option to cooperate or defect. world. This can have a direct effect Her maximising strategy depends on on individuals’ rational deliberation, knowing what the other person will especially since rationality depends do. Knowing one’s past behaviour, on information. The implication of increases the probability of guessing the requirement for rationality for her future behaviour. Therefore in justice as mutual advantage is that this context, a rational agent must its essential prerequisite is equality of know both that she has two possible access to information. In this context, strategies and also that the person she complete or perfect information is not interacts with has been a cooperator or essential. The important thing is equal defector.

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When a rational selfinterested individual knows that others plan to cooperate, it is more likely to interact with them. If they have a history of cooperation, it pays to cooperate with them, whereas if they have been defecting, it pays to avoid interaction. In a repeated game with the structure of a prisoner’s dilemma game, it is rational for one to cooperate if she knows the other party is disposed to cooperate; therefore, it is rational and possible to have a cooperative equilibrium. Rational individuals “develop expectations about others’ behaviour based on precedent – on information about what other people have done in the past” (Young 2001, p.21). Naturally, although it is impossible for one to predict others’ future behaviour, it is plausible to assert that one has a good enough knowledge of others’ past interactions so as to be able to make educated guesses about their future strategies. If this applies to all members of a group or society, equilibria of acceptable behaviour can be created and sustained. The more the amount of available information and the more accurate it is, the more probable it will be that roughly fully informed rational agents will make better choices in selecting whom they interact with. It is important then that information is freely available in order to reach equilibria of commonly accepted behaviour.

As described earlier, justice as mutual advantage is an agreement

reached between rational agents about the procedure of production and distribution of their cooperative surplus. Justice as mutual advantage is the rationale behind one’s constraining her maximisation (Gauthier 1986, p.167) in an interaction. In order for this to be rational, both parties of the agreement have to accept that the difference between the share of the cooperative surplus and their straightforward maximisation is acceptable by rational premises. In other words, both have to comply with a mutually accepted behaviour.

Thus, justice as mutual advantage is an equilibrium of rational behaviour that depends largely on the availability of information.

“Equal information within a group of rational individuals leads to a commonly acceptable notion of a just outcome”

Justice requires rational agents and rationality needs information.

Hence, there is a linear relationship between justice as mutual advantage and information. Equal information within a group of rational individuals leads to a commonly acceptable notion of a just outcome. In addition, information availability works as an evaluative mechanism for established just outcomes. Once a just equilibrium has been established, this can serve as 23

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new information to be used in rational deliberation. Information asymmetries can be used to sustain or create unjust interactions since rational agents have conflicting interests. The argument for justice as mutual advantage is enhanced significantly once there is a method of acquiring or distributing information equally, or when it is impossible for one to withhold information.

Information is a necessary condition for justice as mutual advantage, even if its importance may vary. However, lack or significant asymmetries of information make justice unattainable.

Gauthier, D. (1986). Morals by agreement.

Clarendon Press.

Gauthier, D. & Sugden, R. (1993).

Rationality, Justice and the Social Contract: Themes from “Morals by Agreement”. The University of Michigan Press.

Gintis, H. (2009). The Bounds of Reason: Game Theory and the Unification of the Behavioral Sciences. Princeton University Press.

Harsanyi, J.C., Leinfellner, W. & Köhler, E. (1998). Game theory, experience, rationality.

Springer.

Heap, S.H. (1989). Rationality in economics. B. Blackwell.

Matravers, M. (2000). Justice and punishment: the rationale of coercion. Oxford University Press.

Young, H.P. (2001). Individual strategy and social structure. Princeton University Press.

Bibliography

Barry, B. (1991). Theories of Justice.

University of California Press.

Binmore, K.G. (1998). Game Theory and the Social Contract: Just playing. MIT Press.

Photo by: Chris Wieland

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Vangelis Chiotis is a Ph.D. candidate in the Politics department at the University of York

Issue XVIII - Summer 2012

Intellectual Property - Right or Wrong?

By Scott Chipolina It is this essay’s contention that the existence of intellectual property rights is indeed a good and desirable characteristic of contemporary democratic societies. I will attempt to support this claim by primarily addressing two fundamental reasons which are often cited in order to oppose the existence of intellectual property: the notion of a ‘free market of ideas’ and a position which holds that all intangible ideas ought to be the product of egalitarian redistribution. I consider both ideas to be flawed upon premises which assume false conceptions of human nature and an insufficient protection of individual rights. The underlying theme implicit in these ideas is a defined conception of the good which presumably enjoys universal agreement on the basis of our nature. For example, the good may be defined as pure equality, or happiness.

However, this conflicts unwaveringly with the fact that individuals ‘naturally tend to formulate not only diverse conceptions of the good, but also comprehensive doctrines as such.’ (Graham, 2001, p.140) Consequently, I will frame my essay’s support for intellectual property rights within a largely libertarian perspective on property and individualism, so as not assume any particular conception of the good.

The largest threat to the continuance of intellectual property rights is

based on movements advocating a ‘free market of ideas’. Advocates of this ideal hold that the impact of intellectual property on monopolies over particular goods imposes a necessarily harmful effect on the social collective and progress. Even more importantly, such monopolies often spill over to services which we consider individuals have a right to, such as healthcare products.

How could one therefore, justify the existence of intellectual property rights? From a libertarian perspective, they seem untenable because they fall in direct contradiction with the natural rights of individuals. Ergo, we ought to change the framework in which we consider intellectual property; it should not be governed by economic goals, but by social benefits and obligations. This argument, although useful in highlighting a danger of unrestrained freedom to monopolise anything, does not adequately describe the nature of intellectual property. There is no legal or ethical justificatory method whereby owners or creators may retain the right to withdraw products of direct influence to wider society, such as groundbreaking medical discoveries. In other words, even if a creator deemed that the profits associated with his ground breaking medical work were no longer desirable, he would still lack a moral justification in witholding it, 25

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solely due to its negative consequences on individuals’ liberty and well-being.

The property’s persistence on the market is due to economic advantages only on an analysis grounded in contingent economic factors, and as such would not suffice as an overall explanation.

Notably, it is even plausible to present a safeguard against such exploitation based purely upon a libertarian position that legitimates the existence of intellectual property; it is contradictory to hold that individuals ought to be free to choose actions which infringe upon the freedom of others or commits an individual or group of individuals to harmful effects under gratuitous inequality. We are attacking straw men here, not a libertarian conception of intellectual property. In other words, a world of exploitation and unequal or unjust relations between individuals does not actually follow from the application of intellectual property, or its ability to depart societies from purely egalitarian economic equality.

It only becomes a reality once individuals abandon moral obligations to others, and reject the ‘underlying Kan26

tian principle that individuals are ends and not merely means; they may not be sacrificed or used for the achieving of other ends without their consent.’

(Nozick, 1974, p.31) A second source of support for the existence of intellectual property arises when one carefully assesses the egalitarianism which underpins its critiques which only show the position held by the ‘intellectual egalitarian’ is self-defeating. The egalitarian basis of fairness ‘presupposes that we have a number of people who qualify for the distribution of a certain type of good and are therefore entitled to some share of it.’ (Narveson, 2001, p.280) However, the emphasis on entitlement does not in any way necessitate an equal share between individuals. Seemingly, such egalitarians offer no attention to the fact that some particular product has come about through varying levels of contributions from different individuals, whose entitlement claims are strengthened or weakened by that very contribution. Secondly, a utilitarian perspective can also be adopted in order to justify the resilience of intellec-

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tual property rights. One fundamental Rather, control over one’s intellectual advantage of such rights is their ability activity is an essential foundation for to provide incentives to inventors and the fabric of democratic freedom: ‘By entrepreneurs who end up promoting controlling and manipulating objects, greater social well-being. Organising both tangible and intangible, our will societal conditions that facilitate the takes form in the world and we obexistence of inteltain a measure of lectual property alfreedom’ (Moore, “It seems unlikely that the low creators to be2001). It may be gin ‘competing’ in concept of intellectual rights said that the arguorder to have their may be falsified on the grounds ment presented product grant them above is guilty of of ‘intellectual free markets” the most gain. In unjustifiably movdoing so, as Adam ing to ownership Smith (1759) argued, the benefit of so- of talent and ability based on a more ciety in general is safeguarded against fundamental ownership of one’s self, exploitative individuals because their and consequently not being an adwork not only grants advantages to equate defence of intellectual property. themselves, but to the entire commu- This suspicion is most clearly comnity. Such incentives are eroded from municated through John Rawls, who social relations if individuals had no argues that our talents and abilities are claim to the products they create, sim- not earned, but are morally arbitrary ply because personal benefit would be (1971). However, in attempting to impossible. disprove an ownership of our talents The most fundamental grounding and ability it is simply not sufficient to of intellectual property rights is avail- present them as arbitrary. One would able from the notion of self-ownership, essentially have to prove the existence born out of traditional libertarian po- of an external causal relation between litical philosophy, holding that indi- talents and personal gain. As Robert viduals have moral claims to their own Nozick argues, there is often ‘no mentalents. This line of thought strongly tion at all of how persons have chosen alludes to the concept of self-owner- to develop their own natural assets’ ship as an adequate foundation for (Nozick, 1974, p.214). It may also be social justice. Jan Narveson neatly rep- expected that the fruits of our labour resents this position, arguing that one’ belong to the public on the basis that claiming ‘an equal share irrespective of we are the products of our society’s contribution is to claim the right to institutions, such as family and educaexploit, and at the extreme to enslave, tion. However, this view suffers from one’s fellows.’ (Narveson, 2001, p.280) a misunderstanding behind the role of 27

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social institutions; such entities confer on us a pursuit of profit, showing that our relationship to society is of instrumental value. We use it as a means and not an end in itself, and thus, we ought not to consider the fruits of our labour to be open to public ownership. This concern, alongside the lack of an external causal link between our arbitrary abilities and personal gain portray the fundamental philosophical basis presented by opponents of intellectual property as illegitimate in holding the conclusion that one’s intellectual product is openly available to the wider society.

This essay has addressed intellectual property from two separate directions.

I have attempted to highlight deep mistakes in the most cited arguments opposed to intellectual property, while Illustration by: Horia Varlan

simultaneously presenting a libertarian case for the benefits gained through protecting such rights. In conclusion, it seems unlikely that the concept of intellectual rights may be falsified on the grounds of ‘intellectual free markets’ or an expansion of social redistribution to involve intangible ideas.

Rather, one must adhere to the deeply rooted idea that individuals are separate, and that their product must only be available upon their consent; to ignore the separateness of persons for an assumed social collective is equivalent to committing oneself to exploiting another person as a means to an end.

Bibliography

Graham, P. (2011). Rawls’ A Theory of Justice.

New York: Continuum International Publishing Group.

Nozick, R. (1974). Anarchy, State And Utopia.

Oxford: Basic Books Inc. Narveson, J. (2001) The Libertarian Idea. Peterborough: Ont. Broadview Books.

Smith, A. (1759). The Theory of Moral Sentiments. New York: Cosimo Books (2007) Moore, A. (2011) Intellectual Property. Stanford Encyclopedia of Philosophy, Summer 2011 Edition http://plato.stanford.edu/entries/intellectual-property/ Rawls, J. (1971). A Theory of Justice. United States of America: Harvard University Press.

Sterba, J. (2009) Ethics, The Big Questions. Sussex: Wiley-Blackwell.

Scott Chipolina is an undergraduate student reading Philosophy and Politics at the University of York 28

Issue XVIII - Summer 2012

The Death of Swedish Piracy and a New Economic Model

By Harry Evans The saga of PirateBay.org was one of the defining struggles of the new media age, and a turning point in media distribution1. This has been the characterizing battle of markets coming to terms with the digital marketplace. This essay aims to chart the imminent end of mass internet piracy and look at the new economic model that is picking up the pieces.

International pressure caused Sweden to change its copyright laws in 2009, which are now, broadly speaking, in line with those of other Western countries. This change has been welcomed by politicians, artists and the industry. It has also provoked concern from the voters of Sweden, where the ‘Pirate Party’ - a political party focusing on reforming copyright law2 - has more votes than the Greens3 and now has two MEPs. In spite of this, the party is still sidelined from mainstream 1 For an in depth background to the affair see: Michael A. Lindenberger: ‘Internet Pirates Face walking the Plank in Sweden’ (2009), Time Business, http://www.time.com/time/ business/article/0,8599,1880981,00.html [accessed 28/03/2012] 2 PiratPartiet: Homepage, (no date given).

Available at: http://www.piratpartiet.se/international/english [accessed 08/05/2012] 3 Pirate Partiet: Medlemsstatistik, (no date given). Available at: http://www.piratpartiet.se/ storlek [in Swedish, accessed 28/03/2012]

politics. The dream of the Pirates is setting however, as no new change appears to be occurring in other countries, and the short-lived freedom of the internet appears on the decline. Sweden’s new copyright laws are not reacting to the pressure of the Pirates.

File-sharing sites argue that they can stay one step ahead of regulators, but essentially governments are cracking down hard, and Internet Service Providers (ISPs) are forced to give in.

ACTA, due to be passed by the EU in June of this year will place the burden of responsibility on ISPs4 to ensure copyrighted material is not illegally distributed. Tightening of regulations is set to make this type of file-sharing virtually impossible in a few years.

However, as these developments have been occurring, with Sweden at its focal point, a new economic system has sprung to life. A gap in the market arose from two conflicting forces: the taste of free material, and the tightening grip on file-sharing. A new model has emerged to fill this gap, designed specifically with the purpose of making digital media accessible at a low consumer cost.

4 http://www.ispreview.co.uk/index. php/2012/03/european-parliament-set-finalacta-copyright-treaty-vote-for-june-2012.html (accessed 28/03/2012)

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The basic idea is that subscription and advertisement pays for licensing mass amounts of data, which is then hosted and accessed at the leisure of the end-user.This format exists for music, books, audio books and movies that have the potential of addressing the issues of digital media. The companies, among them, Spotify, Netflix and Amazon are trailblazing a new business model, centred around subscription. The upshot is that millions of

In addition, the other end of the market is satisfied. Licensing deals are agreed directly with record companies, Hollywood and publishing houses, and this allows unlimited use, on various bases. This use differs from platform to platform, which may be a worry. Audible.co.uk (owned by Amazon) offers audio books, which you have ownership of, and can download as many times as you like. Netflix and Spotify are less tangible, and there are significant issues surrounding this, especially regarding mobile access. How-

“A new model has emerged to fill this gap, designed specifically with the purpose of making digital media accessible at a low consumer cost” Photo by: Joe Shlabotnik songs can be played for the same price that used to buy an album. There was initial complaint at the idea of having to pay anything at all for content that many could previously access for free on ThePirateBay. The take-up rate, however, has been excellent, as these platforms have opened themselves up in the international market5.

5 Bill Rosenblatt: ‘Do Paid Music Subscriptions Indicate a Tipping Point?’ (2011) Copyright and Technology blog, http://copyrightandtechnology.com/2011/07/20/do-paidmusic-subscriptions-indicate-a-tipping-point/ [accessed 28/03/2012]

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ever the license works, it offers the producer (and, in theory, the artist) the recompense that they lacked under the file-sharing set-up.

There are, however, still significant wrinkles to be worked out of the subscription system. Firstly, the sustainability of the structures of these providers is questionable. Spotify is not a profitable business, and Netflix has serious worries about distribution costs6. Both of these companies also 6 Karl Denninger: ‘Netflix: Can Its Business Model Survive?’ (2011), Seeking Alpha, http://seekingalpha.com/article/257260-netflix-can-its-business-model-survive [accessed 28/03/2012]

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need to defend against other entrants to the market. Spotify has the most competition here, with LastFM and Grooveshark: but the former of these is less secure in its popularity, and the latter looks to be dissolved in legal cases. It is not hard to see how these problems may be remedied by ACTA and SOPA as more people will turn to paid subscriptions. It is likely that these emerging business models will see significant boosts as the bottom falls out of the physical media market (CDs, DVDs etc.).

The final worry is in the mediumto long-term. As media distributors lose revenue from physical media, and become more confident in their protection in legislation, they will seek to push the cost of licenses up. If they succeed in doing this, all progress in this area will be lost, and low cost culture will be in the past. The emerging new media platforms (Spotify, etc.) as relatively low yield businesses anyway, will not see long before they go under.

To counteract this, there needs to be reform of the distribution industry.

This might take the form of simply reducing their power, or, more radically, forcing them to adopt this new busi-

ness model for themselves. This latter option would allow artists to liaise directly with distributors, through a specialized right management mechanism, cutting many costs.

In Sweden, we saw an end to the dream of free media. This has had repercussions in other industries, such as journalism too, who are looking for new means of sustainable business on the internet. Many industries have to come to terms with the information epoch that has been ushered in with the Internet. As new legislation is brought in, effectively ending hopes of a copyright revolution, new opportunities have appeared. These have offered hope for low cost consumerism on new media but the fledgling industry needs to be protected. People are not prepared to pay inflated prices for their music anymore: subscriptionbased access is a compromise. But it is a compromise the industry needs to accept.

Harry Evans is an undergraduate student reading Philosophy and Politics at the University of York 31

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Issue XVIII - Summer 2012

California Dreams

By Hussein Kesvani

Photo by: Christian Rondeau of free-flowing information has led to arguments that at last, news outlets, corporations and even governments, are rapidly diminishing in power. Yet, despite this romantic vision, there is no consensus that these technologies have facilitated a greater degree of autonomy of individuals. Rather, the age has consisted of the rise of new institutions that operate through the systematic regulation of information distribution, while simultaneously perpetuating the ideology of freedom and autonomy. This essay discusses the ideology underpinning the Photo on opposite page by: Johan Le Bail ‘information age’, and how the rise of

The rapid rise of technology has changed the way we communicate, organise and live our lives, with no sign of losing momentum. This has largely been accepted and met with positive response. Indeed, with the ever increasing influence of social networks, environments in which people can communicate and exchange ideas freely can be said to have finally emerged.

Furthermore, it is popularly argued that such open environments can work to empower individuals more than ever before (Nye, 1998). The large variety

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“ Political theorists on both the right and the left saw technology as a holy grail- a system which would radically remove power from central government” these new institutions has undermined the dream of an unregulated world of free individuals.

To understand the ideological framework of the ‘information age’, it is important to go back to the USA in the early 1990s. Bearing the scars of the cold war, alongside the haunting memories of nearing Nuclear Armageddon, the post-cold war world was one characterised by an ideological vacuum - one in which the visions of neither the American right nor the left had manifested. Indeed, for all talk of Fukuyama’s ‘end of history’, the reality of the post-cold war society was one of uncertainty and insecurity.

The ‘Californian ideology’ (Barbrook, 1996), concentrated in the hi-tech hub of Silicon Valley, was born within this vacuum. Founded on a peculiar brand of liberalism and championed by maverick academics, computer programmers and venture capitalists, this ideology was reminiscent of the similar counter-culture of the 1960’s of which many of its participants, including the late Steve Jobs, became its pioneers. Yet, the ideology was more than a second chance for the liberal optimists. Remarkably, it had opened up an arena in which both the right and the left could find mutual ground for co-operation. While Marshall 34

Mcluhan and Howard Rhinegold idealised the idea of autonomy and reciprocation through technology, those on the right, including Alvin Toffler and Newt Gingrich, hailed the information age as a means of revolutionising markets, allowing consumers greater power and control of their consumption (Dyson, 1993).

A general narrative thus emerged; the rise of technology would revolutionise existence itself, liberating individuals from the old hierarchical structures that dominated society for much of the cold war. Indeed, political theorists on both the right and the left saw technology as a holy grail- a system which would radically remove power from central government, whilst liberating individuals from powerful private institutions and class structures.

Nowhere is the preaching of the new utopia more prevalent than in the context of the ‘information revolution’.

Indeed, the general argument states that as the individual is granted access to a greater quantity of information, they will in turn become more aware, and informed citizens. More radical, is the supply-side argument- that a greater number of entrants into the ‘information market’ would hold powerful institutions to account, but would also revolutionise the information market by toppling the established media hierarchies occupying Fleet Street and Madison Avenue. In doing so, the system would restructure itself, facilitating the rise of informed, empowered and rational individuals (Castells, 2011). Yet this information free market seems not to have delivered on

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that particular promise. Rather, old models of choice theory were found to be no longer applicable within the ‘information economy’. The existence of a larger quantity of variables and decision processes had instead caused a permanent paradigm shift in the way consumers behaved and made decisions, which in turn forced the

maximise benefit, the overwhelming plethora of information available within the information economy would in fact undermine user satisfaction (Schwartz, 2000). Instead of individuals being empowered, they would be made dependent on established, ‘reliable’ brands to receive information, including Amazon,

Photo by: Shawn Collins advocates of the new economy to rethink how variables should be valued.

Barry Schwartz was one of the first intellectuals to recognise this shift. In ‘The Tyranny of Freedom’, Schwartz argued that excessive choice would not allow the development of more enlightened individuals.

Rather, it would lead to a ‘tyranny’ of choice, whereby a greater number of competing products (in this case, information) would not necessarily lead to individual satisfaction with the actual decision made (Schwartz, 2000) . Further, the more variables are added into the decision making process, the less satisfied the individual would be with the final outcome. In other words, rather than a free market of information creating well-informed consumers who acted rationally to

Google and Facebook. As such, an oligopoly of new elites forms at this stage of the ‘information age’ , holding large concentrations of power at the expense of less established information sources, whilst continuing to preach the liberalist tenants of the Californian ideology.

The CEOs of Silicon Valley were aware of Schwartz’s ideas. They realised that if their network utopia vision were to materialise, new economic theories would have to lay its foundations, as well as to set its principles. No-one was more aware of this than the then Stanford University doctoral student Larry Page, now of Google fame. Page understood the paradox of choice in the information economy: while allowing for greater variety was mutually beneficial to producers and consumers

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VOX | The Student Journal of Politics, Economics and Philosophy

in any market, it was also important for the consumer to feel comfortable making decisions. For companies like Google, that meant the creation of a user friendly interface, combined with innovative algorithms designed to make searching for information faster and more efficient than any of its competitors. Taken in part from the examples of Amazon’s personalisation system pioneered in the mid 1990’s the ‘Google Revolution’ (later adapted by social networks like Facebook), built upon the idea that people were incapable of managing information within the free market (Pariser, 2011).

In order to bring about the promises of the Californian ideology, new systems would have to be constructed to allow information to be managed efficiently, tailored to the tastes of each individual user. New algorithms were created by Google, designed to ‘rank’ pages according to relevance, where personal information would be used to produce the results deemed most desirable for the individual. Indeed, whilst Google exists within a world of free information, it has become the dominant system in which information is distributed and managed, using personal information to construct what Eli Pariser refers to as a ‘filter bubble’ (2011, p.35), designed to use the individual experiences of internet users, while filtering out information the system sees as irrelevant to them.

We are now at a pivotal moment in ‘Information Age’. Although the accessibility and quantity of information available has certainly provided a significant benefit to both individuals and society, it is often too

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easy to ignore the costs of such luxuries.

While new hi-tech industrial idealists continue to design and construct new ways in which we experience the vastly expanding network society, they simultaneously continue to preach the vision of the ‘Californian Ideology’ to justify the use of personal and private information. The ideology was founded on a shared idea of a world without hierarchy, where technology would unite people, without rigid class systems produced by old institutions of power. Despite such egalitarian ideals, the information market has thus far failed to truly empower individuals.

Instead, it seems to have facilitated the rise of new institutions, which are increasingly attaining control of how information is both consumed and distributed.

Bibliography

Barbrook, R. & Cameron, A. (1996). The Californian Ideology. Science as Culture, Vol.26, pp 10-23.

Castells, M. (2011). The Rise of the Network Society: The Information Age. Economy, Society, Culture, Vol. 1. John Wiley & Sons.

Dyson, E. (1998). Friend or Foe. Wired Magazine, August 3rd 1998, http://www. w i re d . c o m / w i re d / a r c h i v e / / 3 . 0 8 / n e w t . html?person=esther_dyson&topic_ set=wiredpeople, accessed 30/03/2012 Keohane, R. O. & Nye, J.S. (1998). Power and interdependence in the information age. Foreign Affairs, 77.5.

Pariser, E. (2011). The Filter Bubble: What The Internet Is Hiding From You. Penguin Books ltd.

Schwartz, B. (2000). Self Determination: The Tyranny of Freedom. American Psychologist, 55.1

Hussein Kesvani is an undergraduate student reading History at the University of York

Issue XVIII - Summer 2012

Interview with Dr. Madsen Pirie

By James Paton Dr. Madsen Pirie is co-founder and current President of the Adam Smith Institute, a free market think tank, established in 1977.

Educated at the University of Edinburgh (MA), the University of St. Andrews (PhD) and Pembroke College, Cambridge (MPhil), Dr. Pirie has had a distinguished career within academica and public policy having worked within a number of academic institutions, think tanks and the US House of Representatives. Seen to be an architect of British privatisation policy and the Citizens’ Charter, James Paton discusses the information age with Dr. Pirie in light of his new book, Think Tank: The Story of the Adam Smith Institute available now from Amazon.

1. What explains the success of the Adam Smith Institute in the market of ideas?

The ASI came along at the right time. The postwar consensus of a centralist, statist economy was seen to have failed. Britain was spiralling ever further down the international league tables. Inflation was rampant and industrial relations pathetic. It

was against this background of visible failure that the ASI stepped forward to advocate a coherent alternative based on incentives, choices and markets.

We suggested that enterprise could succeed where state action had failed.

It was also the case that a few people at the top of the Conservative Party were determined to take Britain onto a new tack, first squeezing out inflation, then lowering taxes and regulation to give free enterprise a chance. The appearance of the ASI coincided with the emergence of Margaret Thatcher, Geoffrey Howe, Keith Joseph and a few others. The ideas were successful because there were people sufficiently convinced and sufficiently brave to implement them, and because the alternative paradigm had visibly failed.

State control and state planning has so obviously failed that even their proponents no longer had the force of conviction behind them.

2. How did you help achieve a paradigm shift in economic and policy making from the post-war consensus?

This was partly led by events, in that there was a general feeling amongst economic commentators that things simply could not carry on under 37

VOX | The Student Journal of Politics, Economics and Philosophy

Interview with Dr. Madsen Pirie the old thinking. Britain’s productivity was low, its strike record high, the quality of its goods unreliable. The state did too much, and left too little room for enterprise.

Part of the success was brought about by the crafting of policies in a new way. Instead of simply attempting to bulldoze policies through against vested interest groups, the new approach sought to develop policies that built up new interest groups while compensating existing ones for the loss of benefits. A good example came in housing policy. The old policy sought to raise rents on state houses to market levels, whereas the new one offered the sale of council houses to their tenants at discounted prices. They were compensated for the loss of subsidized rents by the prospect of affordable home-ownership.

The major paradigm shift was not achieved overnight. It built instead on a few of the early successes. These emboldened policy-makers to go further down the road that had led to them.

3. What is the institute’s greatest policy achievement? How did you achieve it?

The ASI’s greatest success was not a policy, though the Institute was involved in many of the policy initiatives such as privatization that characterized the intellectual revolution of the Thatcher years. The ASI’s greatest

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success was in helping to put across the case for economic freedom and enterprise at a popular level. Acceptance of those ideas spread to the economic commentators and analysts, and this emboldened the political leaders.

From there is spread into the print and electronic media, and from there to the public at large.

That transformation in public opinion took place with remarkable speed, given the longevity of the previous paradigm. The ASI played a vigorous role in helping to market these ideas, regularly featuring in press articles and radio and TV programmes. It did so in ways that supplied journalists and presenters with pithy, well-argued pieces and comments that summed up the case cogently yet briefly.

4. How has the institute adapted to the widespread use of the internet?

Has the environment in competing against other think tanks for government policy become more competitive?

The ASI has always attracted young people, as its supporters, researchers and employees. This helped it keep up with technological advance. It was the first UK think tank with a website, and the first with a daily blog. Viewing figures for those reach about a million in a year. The ASI also took to Facebook and to Twitter, again helped by it young members. It publishes an

Issue XVIII - Summer 2012

Interview with Dr. Madsen Pirie electronic newsletter and publicizes its events by social networks as well as email.

Thee are many more think tanks and single issue groups than there were, and this means that there are more ideas coming forward for consideration. In that sense it is more competitive, and the ASI believes in the virtues of competition. It makes people try harder. It also makes people focus on what they are good at, and encourages them to occupy the niches in which they can excel, instead of trying to do everything.

5. How do you think the market for ideas will evolve and change in the next decade?

The market for ideas is changing all the time. The ASI looks to the intellectual backdrop that supports a policy framework, no less than at the development of the policies themselves.

It publishes papers on the Austrian School’s economic approach, making its policy proposals part of a wider, coherent intellectual outlook that has a solid academic basis.

In the last few years the ASI has

devoted much time and energy to winning the intellectual battle over the causes of the financial crisis, feeling it important to lay much of the blame on governments and central banks for pursuing lax monetary and credit policies for political reasons.

The ASI has also taken it upon itself to make a vigorous public case for both free trade and capitalism, stressing that these have achieved more for humankind than any other institutions have managed, generating the wealth that has funded better health, education, cultural pursuits, and which has lifted so many of the world’s peoples from poverty and deprivation.

As the ASI looks to changing ideas, it is placing more emphasis on the civil liberties that are so important to free societies, and which seem under such threats today. The ASI will continue to advocate a free economy and a free society in whatever ways are available to it, both now and in the future.

James Patton is an undergraduate student reading Philosophy, Politics and Economics at the University of York

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VOX | The Student Journal of Politics, Economics and Philosophy

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voxjournal.co.uk

THE STUDENT JOURNAL OF POLITICS, ECONOMICS AND PHILOSOPHY

Call for Papers VOX – the Student Journal for Politics, Economics and Philosophy – is calling for articles to be submitted for the Autumn Issue 2012, with the broad theme ‘Money’.

Articles should be between 1,000 and 1,500 words in length, and fullyreferenced using the Harvard style.

If you would like to write on this theme, please e-mail your article to vox@clubofpep.org by the 29th July 2012.

You may wish to write on a topic from the list below: • • • • • • • • •

Are the fluctuations in the value of money a distorting factor in the economy?

The Euro-Crisis: challenges for economy and political union Should the global economy return to the gold standard?

Money as simply credit: the success and challenges of microfinance in developing communities The Banking system: from a lending to a borrowing machine Money as institutionalizing inequality Ethics & Money – corruption: does your moral code have a price One step removed – consequences of dealing in ‘digital’ money ____________ (your own idea)

You may also pair up with someone else to write a debate for our Market of Ideas section on any of the topics above.

Undergraduates, graduates and academics all welcome. All undergraduate submissions will be conisdered for the Vox Essay Award.

Back issues are available at: www.voxjournal.co.uk.

40 Image by Adrian Humphrey