Kling on Niall Ferguson’s latest

My review of The Square and the Tower.

I think it is very difficult to show that a particular technology favors peer relationships over hierarchical relationships.

I think that many of us made this mistake when we projected the social consequences of the Internet. Because the Internet is obviously a peer-to-peer network, we assumed that it would break down hierarchies. But the social world is its own sphere, and it does not necessarily mirror the technical world. Groups that are peer-oriented can use the Internet, but so can hierarchies. Perhaps some of the social changes that have taken place in recent decades disrupt hierarchies, including changes that were facilitated by the Internet. However, it is a fallacy to insist that just because the Internet is peer-to-peer, human groups necessarily must array themselves in that fashion in order to be successful in the current technological setting.

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2 Responses to Kling on Niall Ferguson’s latest

  1. R Richard Schweitzer says:

    To limit the perceptions of human relationships, particularly in social groupings, to two (or a few) “concepts,” regardless of historical observations, may reveal more about the limitations of perceptions rather than validation of the concepts.

    Suggested reading: pp. 17 [last paragraph] and 101 &102 “The Evolution of Civilizations” by Carroll Quigley (Liberty Fund 1979).

  2. blink says:

    I agree with your critique of Ferguson’s vague definitions. Reflecting on your very reasonable clarification, it seems more like rebottling old wine. How is hierarchy vs. network different from firm vs. market? Coase’s insights about transaction costs seem equally relevant here: Whether networks (i.e., decentralized production) or hierarchies (i.e., centralized firms) become more prevalent should reflect whether transaction costs are decreasing or increasing. That is the evidence we ought to seek. Most importantly, though, we should expect marginal changes (as you suggest) rather than the dramatic shifts that Ferguson envisions.

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