According to rational economics if you are handed $10 and asked to agree a share with another person, you should offer them 1 cent. People offer much more in practice.
Some examples:
- freakonomics - bagel guy: found that if dumped bagels, cream cheese & cash box at companies, found that at some places 95% of people paid
- linux kernel: copyright of patches goes to Linus
- wikipedia have got more than $1m from small donations
- Oink: download site — couldn’t pay for music but some bands got famous based on usage
- terra bite: pay as you wish restaurants
- tipping…? though in America this comes with threats
- “The Plant” — Stephen King book: published one chapter at a time, continued writing if more than 75% of downloads paid up for $1
- article on boingboing how bartering makes banking work in Africa
counter examples:
- web comics: have donate buttons but don’t really work
price discrimination & sales doesn’t work online
- price discrimination — people pay the max that they are willing to pay
- can search for coupon codes
“fame comes before fortune — if you have fame, fortune will follow”
- that’s why micropayments don’t work as trading
Ways to get voluntary economics to work:
- put a human face on it
- peer pressure (e.g. tipping, bagels — had to be in public place)
- communities — build a big one (e.g. when Starship Enterprise was canned, community raised $3m)
- rewards based on community
- emotion — you like it, pay money/contribute time to support
Has to be aimed at people — more emotional: corporations will just say thanks for free
Is voluntary economy a luxury good?
- Does it only work when economy is good?
- Maybe not — it’s a transaction since there are more things being transferred than money/time — blog is getting attention
- —> redefine the rationality of the economic agent
- economically more efficient
Short story from Bruce Sterling on the same area
Plug: TipIt — tip any blog
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