This post is an update to the model I first introduced in Unifying the Value Universe, offering a couple revisions in preparation for an in-process significant extension.
The two updates both derive from discussions related to gift economies. When I first introduced the four quadrant model I expected that gift economy would stir up the most debate and as a result I avoided addressing the subject until some time later. As expected, numerous people weighed in, offering disparate perspectives on what gift economies are and are not. The obvious conclusion became unavoidable – gifts can take many forms and are proffered in many disparate contexts. The act of gifting, of giving generously, is clearly not isolated to any categorical form of exchange. My attempt to shoehorn gift exchange into one specific quadrant produced an unnecessarily fragile model.
Gift Economies…Loosely Redefined
As it became painfully clear that no single definition of “gift economy” would satisfy everyone, I began to wonder if there was any salvageable meaning to the term whatsoever. Obviously my preferred interpretation was sinking, but were any of the various other (often contradictory) interpretations any more valid?
The common theme resonating through much of the feedback I received was asymmetry. People argued, in many different forms, that ‘gift’ should refer to those exchanges that lack a formal expectation of reciprocity. There might exist social norms dictating some degree of loose reciprocity in the long run, but in the short run most people expected gifts to convey generosity. The greater the potential for asymmetry in a given exchange, the more we perceive it as gift-like.
This dynamic can potentially exist in any of the four quadrants. For context, here is the model as originally proposed:
Gifts are obviously exchanged within relationships on the basis of generosity alone. A slightly different form of gifting is also present in the attention economy, as digital content is commonly offered freely without any necessary expectation of reciprocation. In the transactional economy gifts can be proffered in the form of philanthropy.
That leaves us with the now nameless upper-right quadrant. Before we can address that we need to take a quick detour…
Refinement and Legibility
In the original model the y-axis represented the variable refinement, which I defined as follows:
- the degree to which a given value proposition can be accurately judged prior to exchange
- the ease with which that value is extracted by the recipient
In thinking about this further I realized that my definition muddled two related concepts together: refinement and legibility. Legibility is a concept I first encountered through Venkat Rao via his post – A Big Little Idea Called Legibility:
…the word “legibility” is not a metaphor; the actual visual/textual sense of the word (as in “readability”) is what is meant.
You will get a much better feel for the idea by reading Venkat’s full post. He himself admits that “it is surprisingly hard to find words to express it succinctly“.
For our purposes here, I will simply suggest that legibility is the compliment to refinement. Of my original definitions (above), the first more appropriately describes legibility. Refinement is more accurately defined as the effort on the part of a producer to make the value of a given product more more accessible to the consumer.
As such, legibility and refinement are two sides of the same coin. Refinement produces a more legible value proposition. Branding, standardizing, and anchoring are all refining tactics. Alternatively, as suggested in the second definition above, refinement could simply make the product itself more accessible such that its consumption value is more obvious (i.e. legible). That is how we use the term in reference to “refined sugar” or “refined oil”.
The Illegibility of Relational Gifts
Why did the previous discussion of gift economies require a tangent into refinement and legibility? Consider a commonly referenced hypothetical scenario:
Two friends get together regularly at local restaurants. On these occasions it is customary for one person to pick up the entire bill. Custom also dictates that they alternate picking up the tab, though this may vary depending on the occasion (birthdays, etc). Neither person keeps a strict tally of how many times they have each paid or who has paid more in aggregate.
Intuitively we will want to say that the above scenario describes a series of exchanges that should map to the relationship economy. Yet, restaurant meals are clearly not unrefined according to definitions offered above. Quite the opposite. Restaurant meals are highly standardized and clearly priced. The original model created confusion by suggesting that this sort of social exchange should map to the upper-right quadrant. Fortunately, that confusion resolves if we take legibility into account on vertical axis.
Though the goods in question (restaurant meals) are thoroughly refined (facilitating transactional exchange between customer and restaurant), both friends endeavor to obscure the terms of the quid pro quo between themselves. Social norms dictate the they do everything possible to make the refined value exchanged less legible. If the recipient of the “gift” on any particular night were to ask about the amount of the bill, the giver would generally deflect the question: “Don’t worry about it…you paid last time.”
The taboo against discussing the formal quid pro quo persists so long as the balance falls within an implicitly accepted margin of error. When that implicit margin is not mutually understood, painfully awkward situations ensue…
Next time you are out at a popular restaurant keep an eye open for large groups of 20-somethings and watch to see what happens when they get the bill. Often you will notice one member of the group intent on precisely allocating the bill down to the last penny while others at the table exchange uncomfortable glances with each other.
Adopting the concept of legibility allows us to account for these sorts of ambiguous situations. Whenever the parties to an exchange actively obscure the explicit terms of trade, the intent is to push towards relational or attentional dynamics. When the explicit terms of trade are emphasized the intent is to invoke a formal transaction or a legible debt. ”Gifting” with the intent to invoke a legible debt is how I originally characterized gift economies, by analogy to tribal gift economies. How then to rename the now nameless quadrant?
The Political Economy
I have taken recently to referencing the upper-right quadrant as the political economy. The political arena incorporates all the social/economic dynamics applicable to refined/legible exchange between related parties…
- Trading favors – check
- Perpetual jockeying for status and influence – check
- Duplicitous behavior enabled by lack of transparency – check
- Shifting alliance based on Machiavellian pragmatism – check
The reason for this unsavory behavior is rather simple – both relatedness and refinement (legibility) facilitate keeping score. When score keeping behavior festers over an extended period of time, people tend to lose sight of their original motives and blindly pursue the score itself. They mistake the metric for meaning.
Of course, political dynamics are not entirely negative. The above observations are drawn from entrenched political environments that have advanced into the later stages of ossification. These same dynamics may present in a significantly healthier form in newly emergent political regimes. But that will have to wait until next time…
Upcoming: the evolutionary lifecycle of socioeconomic dynamics
photo courtesy of barefootsong
