Home » Uncategorized » Some sources of friction are worth protecting, even in the face of a global economy that threatens to flatten them.

Some sources of friction are worth protecting, even in the face of a global economy that threatens to flatten them.

“…Developments in information technology are enabling companies to squeeze out all the inefficiencies and friction from their markets and business operations.  That is what your notion of ‘flattening’ really means.  But a flat, frictionless world is a mixed blessing.  It may, as you suggest, be good for global business.  Or it may, as Marx believed, augur well for a proletarian revolution.  But it may also pose a threat to the distinctive places and communities that give us our bearings, that locate us in the world.  From the first stirrings of capitalism, people have imagined the possibility of the world as a perfect market – unimpeded by protectionist pressures, disparate legal systems, cultural and linguistic differences, or ideological disagreement.  But this vision has always bumped up against the world as it actually is – full of sources of friction and inefficiency.  Some obstacles to a frictionless global market are truly sources of waste and lost opportunities.  But some of these inefficiencies are institutions, habits, cultures, and traditions that people cherish precisely because they reflect nonmarket values like social cohesion, religious faith, and national pride.  If global markets and new communications technologies flatten those differences, we may lose something important.  That is why the debate about capitalism has been, from the very beginning, about which frictions, barriers, and boundaries are mere sources of waste and inefficiency, and which are sources of identity and belonging that we should try to protect.  From the telegraph to the Internet, every new communications technology has promised to shrink the distance between people, to increase access to information, and to bring us ever closer to the dream of a perfectly efficient, frictionless global market.  And each time, the question for society arises with renewed urgency: To what extent should we stand aside, ‘get with the program,’ and do all we can to squeeze out yet more inefficiencies, and to what extent should we lean against the current for the sake of values that global markets can’t supply?  Some sources of friction are worth protecting, even in the face of a global economy that threatens to flatten them.” 

Michael J. Sandel, as quoted in The World Is Flat by Thomas L. Friedman

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