CSE268D: Social Aspects of Technology and Science
Notes for the Seventh Meeting
6. Case Studies and Applications
        (This continues from the notes for the sixth meeting.)

The nursing example in the paper by Bowker and Star raises important issues about the role databases in healthcare (and in other areas) that are well worth pausing to think about. The reason the nurses want to get their concerns into the hospital databases is that there is a tendency to regard only what is explicitly represented in such databases as "real"; the rest is invisible, or to use the Bowker-Star term, it is infrastructure. Even if hospital administrators in fact know very well that some particular thing that does not appear in the database is actually important, they will still have difficulty in generating figures and reports to justify such an assertion, without the data to feed to the programs that generate the reports that administrators higher up the chain will read. There is a "chain of translations" that goes up the administrative hierarchy, and whatever is not explicitly represented, will have trouble getting the attention it may deserve.

There is a tendency for databases to establish and freeze a status quo. The very fact that they are difficult to change tends to increase institutional inertia. Many facets of the social context of organizations are reflected in institutional databases, including the non-representation of certain areas. Moreover, reductionist views of organizational operation are strongly reinforced, because they are far easier to implement in a database than "holistic" or "reflexive" or "ecological" views; for the same reason, quantification is strongly reinforced. And of course classification schemes are absolutely necessary in order to code things in a database at all, so classifications and standards also get strongly reinforced, and then become harder to change.

The view that computer systems tend to foster institutional inertia rather than institutional change is also made in today's handout, The Myth of the Computer Revolution, by Neville Holmes, in IEEE Computer, November 1998, pp 121-122. (Although Holmes sounds like a bit of curmudgeon, his piece is fun and easy to read; he makes his points clearly, though he tends to overgeneralize, and his arguments aren't always very good.)

7. The Net, the Web, and Economics

Let's begin with some points about the net with which you are probably already more or less familiar. The internet rests on the 7 layers of the OSI protocol, which are designed to allow building new protocols on top of them; for example, audio and video streaming are interesting new internet protocols. The web is a not so recent example; it runs on the http protocol. The basic idea of the internet is packet switching, which means breaking information up into small "packets", each which of which may get to its destination by a different route, and which are resent if not received. Thus it is by design highly decentralized and flexible; this is in considerable contrast to other media, e.g., books, newspapers, TV, telephones.

Some aspects of the internet, and more specifically of electronic commerce ("ecommerce"), can be difficult to understand - and I don't mean technically. A vast array of questions are being raised by this extremely rapidly growing new medium for communication. Many of these are actually the same old questions that have vexed communication of all kinds for centuries, such as privacy, politics, and pornography; others may seem quite new, such as disintermediation, spam, and convergence (but are they really new?).

It will help to have clearly in mind certain general principles, some of which we have already discussed.

  1. First of all, it should be clear that the internet exists in the context of society; it is not an autonomous force for change; it is subject to regulation, and in fact, it is increasingly being regulated; the internet and society are inextricably tied together.
  2. Like anything else, in order to discuss the internet, we need appropriate concepts, with methods for applying those concepts, and theories within which they are given meaning. It is important to distinguish among the many different kinds of concepts and assertions that are relevant the internet. Some are (more or less) factual, while others are deeply intertwined with dubious theory, and still others are pure speculation. For example:
  3. Like any other large scale social phenomenon, especially a new one, there are background cultural metaphors and stories that color our perception of what is going on. For the internet, these include the American frontier, radical notions of freedom, and myths of utopia.
  4. All kinds of different special interest groups are trying to impose their view of what the internet should be, ranging from the religious right to libertarian cyberpundits, and certainly including large corporations. It is important to think about the source of each opinion you hear, and about the reason behind that opinion, just as with partisan politics. A lot of it is misinformation or disinformation.
The most important questions about the internet are deeply social, and have to do with setting policy and making law (or not doing so, which will have to be a deliberate decision). Economics plays an extremely important role in this, since we are in a capitalist society. As a result of this, a lot of our discussion is going to be about economics, either going over some of its basic concepts, or else applying them. However, we are in a position to be more critical about this than economists typically are, due to our prior work on the sociology of technology and science.

Classical economics begins with Adam Smith's famous 1776 book An Inquiry into the Nature and Causes of the Wealth of Nations, usually known as just The Wealth of Nations. Smith wanted to know what causes (what we would call) a high and rising standard of living. Although Smith thought division of labor was the most important cause, today's economics puts prime emphasis on resources, taken to include labor and capital, as well as so called natural resources; technological innovation is also considered important by both Smith and modern economics. The role of resources in improving production can be either to use existing resources more productively, or to use more resources; these correspond (roughly) to micro- and macro- economics, respectively, which are the two main branches of modern economics. All this is in Roger McCain's webtext.

McCain's webtext also discusses what he called reasonable dialog, which I would rather call a dialog of practical reasoning. Practical reasoning is what we do every day; this is a huge topic that is still poorly understood, in stark contrast to the formal reasoning of classical logic, which is very well developed, but only applies to an ideal world of Platonic truths. However, modern philosophers have made some progress with practical reasoning, and one important concept is defeasible reasoning. By the way, McCain's emphasis on dialog goes back to Plato's version of Socrates.

Perhaps Adam Smith's most important concept is that of a free market; the idea is that free trade among buyers and sellers will result is an optimal pricing and an optimal distribution of goods. This idea is still enormously influential today, but it is vital to recongize that Smith's theory depends upon the assumption that all players involved have approximately equal power; this assumption is called symmetry, and is obviously false in (most of) today's world. (This issue is not discussed in McCain's webtext.)

Classical economics was out of fashion for many years, one of its strongest critics being John Maynard Keynes, who (along with Karl Marx) pointed out the tendency for "boom-bust" cycles, and who suggested remedies for this based on government intervention. But in a revised form called neo-classical economics, Adam Smith and his free market are now very much back in fashion. McCain's webtext gives a good discussion of two major assumptions of neo-classical economics, namely (1) rationality and (2) self-interest. McCain admits that both of these assumptions are obviously not true in all cases, but he gives arguments that they are still reasonable starting points for constructing models, which is what "positive" economics is supposed to do. He emphasizes that these are not "normative" assumptions, about how people ought to behave.

McCain does not discuss two further very basic assumptions of neo-classical economics, that (3) modelling only the allocation of resources is adequate, and (4) resources can be valued in purely monetary terms. These too are obviously false, but once again, that does not prevent economists from constructing models based on them that may be useful. The second assumption means that the models can be quantitative, which is very important because then mathematics can be applied; most of modern economics is highly quantatative. (It is easy to see from McCain's Chapter 3 that these assumptions are implicit in his approach, although he never does makes them explicit.)

In The Market and the Net, Phil Agre highlights a kind of "convergence" between recent concerns of neoclassical economists and cyberspace pundits, having to do with the abolition of institutions due to the internet. He describes an approach due to Coase, which says that if some market does not behave like Adam Smith's free market, it must be because some assumption behind that market is not satisfied; there are implicit assumptions here, that markets will behave in an optimal manner if the right conditions exist, and that free markets are what we should have; there is also (I think) a confusion of the technical economic meaning of "optimal" with its more everyday meaning.

Agre then explains what transaction and coordination costs are, and goes over the argument that large firms should cease to exist if transaction costs can be brought down far enough, which is just what the internet is doing. He also gives Douglass North's definition of "institution". And then he goes over the argument, associated with Posner, that free markets require impersonal institutions and perfect information. Agre relates this to four myths about the internet, which he calls community, cyberspace, disintermediation, and decentralization.

Agre then introduces his own ideas about privacy, which are very different from the idea of having perfect information about all participants in internet markets; the contrast is brought out by discussion the (undesirable) psychological condition of "instant intimacy". After that, he argues against Posner, by pointing out two fallacies.

Agre concludes by noting that: in bringing the internet into wider use, we are necessarily building institutions, not destroying them; and that what is really at issue here are issues of human freedom, and human relations.

        (This discussion continues in the notes for the eighth meeting.)

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Last modified 18 November 1998