Path Dependency and the self re-enforcement of institutions

Akrasia

Many people point towards the dominant institutions of our time, Economic, Cultural and Religious, and they infer from the power and support these institutions appear to have, that this is an indication that they must be superior to other, less popular or powerful institutions by virtue of the fact that they are more successful. The logic is simple, "A billion Christians can't all be wrong" or "They tried communism and it collapsed, therefore capitalism is the last best option for society".

Unfortunately, the underlying assumption beneath that inference is not necessarily true. Just because something is the dominant form of institution or technology, does not mean that it's the best.

Path dependency theory attempts to understand why some technologies or social institutions succeed, and others fail, even when the successful institution is technically inferior. I'll try to give a quick summary of the processes involved.

Basically path dependency involves a series of decisions linked in a chain, each of which, once taken, limits future options towards a particular path. These decisions are usually irreversible once taken because the process of following one path over another means building a specific technological or social infrastructure that is not flexible enough to allow a dramatic change in direction without having to invest heavily in a new infrastructure.
It's easiest to explain by use of examples.

In your personal life, Path dependency is easily demonstrated by looking at some key life decisions each one of us makes. A decision to pursue one type of career, for example, creates a path dependency because the training you receive is only relevant for particular types of job, and the further you go down a particular path, the harder it is to change direction.
If you go to college and study Arts, you are cutting off options for a future career in nuclear physics (although at an early stage in training, there is still plenty of scope for you to drop out of that course and change to a science degree). The longer you remain on one path, the more path limiting decisions you will make until eventually, when you're a tenured Sociology professor, you'll be extremely unlikely to ever change career.

The important point to keep in mind during all of this, is that even though you might be locked into one particular path, it is not necessarily the optimum use of your skills or the job you would most like to do. You might be a brilliant sociology professor, but you might far prefer to be a physicist and you might be equally talented in that field, but you lack the necessary infrastructure to make that change. The option to change is still available (most of the time) but only a tiny percentage of highly motivated people would ever go through all the trouble and take such a big risk at attempting to follow a new path at such a late stage.

The same is true for technology. VHS vs BETA is the common example. There was only room for one standard technology in the home entertainment industry. While Betamax was commonly regarded as the better product, it lost out because of some very poor marketing decisions by Sony, and VHS became the standard and developed the infrastructure that meant Betamax could no longer compete.

In terms of Political philosophy, Many people point towards the victory of capitalism over socialism and claim that this must necessarily be because capitalism has some inherent characteristics that make it superior to the alternatives. I strongly disagree. I believe that over the centuries, the path towards neoliberal capitalism has been marked by a number of important events that corralled development down a particular path, and the more Hegemonic this path, the more difficult it is for any other system to survive.

Unfortunately, I believe that the direction our current path is leading us down is a dead end for human civilisation. We are going to wipe ourselves out unless we can break free from the cycle of greed and power lust that plays such an overwhelming role in global affairs.

I have included an attachment that outlines (very briefly) the different factors involved in path dependency and what needs to be done to escape from dependency (I hope it uploads properly). It's from a paper called "Organizational Paths:
Path Dependency and Beyond presented by:
Jörg Sydow, Georg Schreyögg and Jochen Koch" (I can e-mail a copy to anyone who wants it)

The theory is particularly relevant now in terms of our energy infrastructure.

As the age of Oil is about to run it's course, there is a race now to develop the next dominant form of energy, whether it's Nuclear renewable wind, solar, tidal etc, hydrogen, electric cars or biofuel... Each one of these technologies has the potential to become the dominant form of energy production, and it's also possible that we as a society will choose to reduce our reliance on Macro Generation on an industrial scale in favour of decentralised micro generation using several of the above mentioned technologies. Whatever happens, whichever technology achieves dominance, will have a huge impact on the future of human civilisation. There are some elites who are specifically trying to engineer a path dependency in favour of their own proprietary technology, and we should do everything we can to prevent them from succeeding at this because it virtually guarantees sub optimal development at a significant cost to individuals and society (The Nuclear industry are pushing for more nuclear power plants, but an investment of this kind locks a state into one technology for decades and blocks other, perhaps much more beneficial technologies from succeeding.

I believe that excessive Intellectual property rights are an aggravating factor in the creation of sub-optimal path dependent technologies because it creates a huge incentive for vested interests to ensure that their technology wins out above the competition.
What do people here think about all this?

petethebrick

I think it's important to recognise the importance of critical junctures in the trajectory of development. In times of crisis, human kind, under the auspices of states and institutions has repeatedly displayed a capacity to contemplate, rethink and reform policy and to change direction accordingly.
It's an interesting subject and one I must read up on in more detail.

Akrasia

petethebrick wrote: »

I think it's important to recognise the importance of critical junctures in the trajectory of development. In times of crisis, human kind, under the auspices of states and institutions has repeatedly displayed a capacity to contemplate, rethink and reform policy and to change direction accordingly.
It's an interesting subject and one I must read up on in more detail.

yay! a reply

eoin5

This is pretty interesting, I see it in our healthcare system. The systems that weve set up in our public healthcare system has made it very inefficient over the years, now that they are in place its very difficult to turn back and thats why people are getting better care in private hospitals in the country now.

PHB

It's all about weighing up costs and benefits of intellectual property.
In terms of sub-optimal being ensured, I'm not sure I necessarily agree with that. The desire of the elites to dominate doesn't stop once something else becomes the dominant force. If nuclear energy became dominant, it wouldn't stop the push towards fusion, simply because there is a economic logic for pushing towards it in order to make a great system, and thus one more profitable. Obviously this correlation doesn't always apply, but without the economic incentive, where it the push for research gona come from?

DadaKopf

Really, what this thread is about is how certain discourses - ways of thinking and acting - are created, imposed and maintained, often in ways that are invisible to most. Therefore, the question is how are such discourses reproduced among the incorporated and oppressed. Clearly, those in power can be expected to hold on to it. But it is the way in which the disempowered also reproduce those concepts that reinforce their oppression is what must really be dissected and destroyed.

That's why I really like the ideas of Pierre Bordieu, who argued very convincingly about the ways in which taste itself is a resource which creates the conditions for domination and subordination. E.g. good table manners being a ticket into a particular social class.

AngryHippie

Similar to the monopoly -v- perfect competition economic theories. A very tricky subject to rationalise, due to the complexity of the future path choices and the bias given by past path choices. But it is clear that the Monopoly/oligopoly model results in huge inefficiencies. Unfortunately, as time progresses and the perfect competition model whittles out the weak/less successful ones, it also makes it harder for new competitors to enter the market, either by regulation, short term undercutting or "loyalty" custom. The same applies to political institutions in most senses, although the parallels can be a bit of a stretch.
The historical development of our current political situation has suffered from all the manouvers typical of an oligopoly, headed by unions of states, initially trade based, but moving into deeper and deeper constitutional ties. This started with the US, The undercutting could be represented by CIA and Pentagon intervention in many countries they feared to be turning communist. Then they turned up the heat with economic sanctions. Then the legislative campaign began in earnest with the establishment of the EU, The loyalty can be indicated by the voting patterns which have consistently put blatant liars, war criminals and corrupt public officials back in office, Merely because people feared the alternatives.
It could also be said that we have come so far along this path that it would be difficult if not impossible to return, But as any democracy is only 3 meals from a revolution, Impossible is nothing.