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Ethos Perspectives
The Free Economy
Conclusion: Free, or Finding Something Else to Sell?
Though Anderson has chosen to call his book Free, his exploration of the various Free business models demonstrates that there are ways for firms to convince the market, or a segment thereof, to pay. As he admits, "Free may be the best price, but it can't be the only one". Indeed, it seems that the only thing firms can do to adapt to the technological reality of abundance is to find what Anderson calls "adjacent scarcity" — features or externalities that cannot be duplicated without cost. Anderson’s solutions are fundamentally reactionary rather than revolutionary: instead of confronting abundance, firms are urged to get creative and find new scarcities.
Ultimately, Free is somewhat less radical than the title suggests. A large portion of the book is about the present and future of business, rather than the present and future of economics. Even though firms will have to adapt to new realities, Anderson offers no new Theory of the Firm. No major microeconomic laws have been revised, and as Professor Z. John Zhang of Wharton Business School notes, "reports of the death of price are greatly exaggerated" 23. That said, we should not overlook the impact of Free in the non-monetary realm, for the gift economy may be more important to us than we realise.
Prepared by:
Matthias Chew
Intern
Strategic Policy Office, Public Service Division
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