Eat What You Kill

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One of the really interesting outcomes of a firm-based economy – with set wages, central authority, mass production, et cetera – deals with competition and cooperation.

“For the good of the company” is a phrase we all grok, and we have all been faced with a choice where we responded that way before. It means that even though a business decision may not be in my short-term interests, it is for the benefit of the company, which is in my long-term interests. We understand that intuitively, and it’s easy to grasp. But in a free-agency model, that isn’t always the case. 

Think about a purely commission-driven sales team. If you haven’t seen Glengarry Glen Ross, do so, first of all. (Incredible David Mamet play turned into an iconic film with Jack Lemmon, Alec Baldwin, Kevin Spacey, and (an overrated) Al Pacino. These desperate real estate salesmen are competitive to the point of it being detrimental to the company as a whole. Cheating, back-stabbing, and lying may very well help one salesperson close more business than another, so there’s plenty of incentive towards bad behavior. Now, of course, if I am a bad actor while being a salesperson, there is reason to believe that will ultimately be outside my best interests, too, yes, but instant gratification, especially when there is a financial reward attached, is hard to overcome. Of course, this example is extreme, but there are unwanted, anti-cooperative tactics that come along with competitive compensation.

We often talk about the primary benefit to the firm as being the efficiency in production and distribution, but it’s worth noting that there is some efficiency relating to ‘coworker’ relationships, as well. And so, if we have better and more efficient means of production in a p2p, free agency-driven economy, I wonder if the utilitarian benefits to banding together formally need to be adjusted as well… Perhaps one answer to this is a new class of unions and artisan guilds.

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