Why People Contribute to Tom Sawyer Economy

Wikipedia for all its flaws has emerged as a successful model in building a crowd-sourced knowledge repository, a manifestation of the new economy.  There are indicators pointing towards an apparent leftist slant on quite many issues including complaints of conservative thought being side-lined and deleted. Yet, the sheer contributors is amazing. It might be worth pondering why people contribute in terms of content building to Wikipedia. Similarly we find people contributing big in open source software development including Mozilla, Apache etc. to every proprietary software, there is an open source equivalent including Open Office etc. The crowd-sourcing has caught on the fancy of many a industry. Innocentive, Kaggle etc. have built upon platforms bringing together demand and supply sides in the problem solving and analytics industry. Aurdino performs a similar role in hardware industry. Instances of GoldCorp, Novartis, NASA etc. in leveraging wisdom of crowds as Suroweicki puts it demonstrates a wide ranging applications. A puzzle that needs to be pondered would be what makes people participate in these activities.

To many, challenges are something part and parcel of life. They love to conquer unchartered territories. Cracking a puzzle generates a marginal utility or in common parlance, a kick that incentivises them towards the same. GoldCorp etc. announced prizes which acted as the incentive mechanism to lure people beyond geology or mathematics. Many firms’ crowd-source designs etc. through creation of incentive mechanism monetary or otherwise to which people respond to. Open source software incentives are more of non-monetary in nature and revolve around community recognition and standing.

To firms like Innocentive, Kaggle among others, platforms ease the transaction costs for both demand and supply sides. For the analysts who are offering solutions, the platforms facilitate conveying of certain signals. In the analytics industry, given the degree of specialized expertise essential, it is a platform to convey signals to the demand side of the platform. Constant and swift solutions to problems build up a standing. The standing acts as powerful signal to all those in the industry wishing to hire talent. A consistent performance indicates higher degree of domain knowledge and thus sends a signal to the prospective employer. To an employer keen to hire a prospective employee, the signal eliminates the barrier of information asymmetry that exists in identifying the right talent. These platforms act as separating equilibrium in domains of analytics and allied fields. Similar separating equilibrium are observed in the open source software industry. The active involvement in open source is good enough signal to indicate coding abilities accompanied by thinking and problem solving abilities to prospective recruiters in the IT and allied industries.

There are few who contribute in these crowdsourcing activities aside of incentives. To some, they have earned sufficiently enough. The marginal utility from work is now less than the marginal utility earned by spending with their family or engaged in creative pursuits. These are products of what economists have termed as Backward Bending Labour Supply Curve. The labour supply curve is a trade-off between hours spent on work and hours spent in leisure. At higher incomes, with increasing work, the marginal utility per unit of leisure increases tipping the scales at one point causing the supply curve to bend backwards. Having enough money so as to speak allows them to engage in leisure activities in what Clay Shirky terms as utilization of Cognitive Surplus. Therefore they seek to engage in activities like Wikipedia, open source design and similar pursuits. Unlike couch potatoes or spending time in pubs which was passive way of leisure, the current leverage of cognitive surplus is constructive. Perhaps to some participation in these activities can be an equivalent of Veblen goods. In fact Veblen goods were first described as signals to the society of sufficient money to engage in consumption of these activities.

McClelland posited a theory of acquire needs. To him, people at different stages of life possessed a Need for Achievement, a Need for Power and a Need for Affiliation. It is not unusual for people to have ambitions of penetrating and succeeding in unorthodox fields. Yet circumstances force them to trade off towards taking up jobs or assignments in unrelated fields. There are many design graduates who because of paucity of jobs take up careers in completely unrelated fields. Some might enter in to the domain of management because of parental pressures to abandon courses like fashion design, interior decoration etc. Yet the urge and interest has not disappeared in them. The materialisation of new modes of production is an opportunity for these to harness their untapped latent skills. There is a sense of achievement of having contributed something constructively and having participated something constructive in those domains of passion yet compromised to abandon by circumstances. For many, this might be a way to build up affiliation with the similar interest groups. These are often observed in discussion forums and bulletin boards among others. Some through their achievement and contributions scale up in the hierarchy that is often determined by past contributions. The greater the contribution, higher the place in the hierarchy. This adds up to realising the need for power. The new production models harnessing the collective intelligence enable the vast sections of the people realise in differing ways the need to achieve, the need to exercise power and the need to affiliate.

Quite a few others having gained some knowledge want to utilize the same to share with the others. There is an implicit signal to convey that the person has certain knowledge sets. There are more than enough people to offer advice on travel, vacation spots, accommodation, restaurant reviews, movie reviews if nothing else just to demonstrate their knowledge. Aside of pretending to be an expert, there is also an added motivation of reciprocal altruism. There is a tendency to share information with others in anticipation that others will share too such information when these people need the same.

A glance at the differing reasons offer interesting perspectives to decoding the motivations behind people contributing in the crowd-sourced models and discussion forums among similar tasks. A few perhaps respond the monetary incentives. There might be few who are satisfied with non-monetary incentives too. Some are lured to utilize their cognitive surplus in building something new or productive rather than being a passive consumer of leisure. For some it is powerful signal in the markets for talent highlight their versatile and specialised skill sets. Many others would want to involve to signal their well off status or in other words a Veblen good. Some utilize the same to a constructive engagement in the backward bending labour supply curve. Many treat participation in these activates as an anticipation of reciprocal altruism.  There is equally large numbers who use the same to fulfil the need for achievement something missed as they traded off passion to career on monetary or other considerations. Few may exercise their long craved need for power and some fulfil their need to affiliate by hanging around in the network offered by these communities. There are some who participate for the kick it generates in them. 

Yet it is pertinent to understand none of the reasons are mutually exclusive. In fact need for achievement or affiliation might actually originate in backward bending supply curve. Veblen good is an indicator of well-off and reflecting need for affiliation etc. Higher marginal utility in fact might well be linked to McClelland theory of acquired needs as much as to incentive mechanism. Therefore, it is highly possible that people’s motivations overlap with each of the reasons The important dimension is however the creativity of entrepreneur who manages to leverage these to build a monetizing platform directly or indirectly something resembling Tom Sawyer and his whitewashing the wall.