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The concepts of crisis and transformation, Reading 8: Machine/organism…
The concepts of
crisis and transformation
Crisis
a turning point or turn around in the flow of affairs
moving towards improvement and recovery or degradation and death
a falling GDP
inflation/deflation
recession or depression
quantitative change
fatal conceit of economics
a mere correlation: lower interest/higher investment
causal relationship
lower interest→higher
investment
effectively disregarding the requisite changes in the underlying composition of production and allocation of capital assets
Transformation
qualitative change
a process of
profound and radical change that orients an organization in a new direction
There is no return and no
resume of normalcy
a new standard
Market
market
regulation
protects fair and legal benefits to both
sides
free markets are self-regulating
optimal re-allocation
market intervention
increases the benefit of one side at the cost or loss to the other
State interventionism through the Central Bank
the crucial role
of interest rates
lowering interest rates artificially
There are
no real savings, no released resources
The demand for money is huge, yet the
price of money is low
stimulating consumption and investment even
more
The false signal of easy money leads to overinvestment in new projects
re-allocation cannot take place
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principles of autopoiesis
self-production
and self-regulation
self-equilibrating organisms, not
mechanistic contrivances
rules of conduct, interaction and coordination
M/O spectrum
Machine (M) is heteropoietically constructed by an
external designer who remains separate from it
Conceived and constructed by its builders to
pre-specified purposes of its users
No autonomy
require an operator
No learning takes place: machine structure is
fixed and cannot learn as an entity
Organism (O) is autopoietically organized and directed by its
own constitutive components
Self-produced, guided by their own
Autonomous or semi-autonomous
All living organisms can learn as an entity
through all of its components
Organization and structure
networks of
coordinated processes
response, cooperation, competition and communication
Organization gives rise to structure
Structure
the spatio-temporal distribution of outcomes or products of the rule-coordinated processes
specific manifestation of the underlying organization within the specific context and conditions under which the rules were applied
a static
“snapshot”
Organization long-term invariant and subject only
to transformation
Changes in organization lead to changes in structure
structure is short-term specific and
subject to cyclical adaptations and crises
Changes in structure do not lead to
changes in organization
The model of autopoiesis
Creation (poiesis)
the rules and regulations governing the entry of new components
Growth (bonding)
the rules governing networks
Destruction (replenishment)
the rules and processes associated with the exit or termination of
membership
Self-service society
replacing the
traditional, other-person-delivered services at an accelerating rate
Work can be defined as an economically purposeful activity requiring requisite human coordination of task and action
“Job” designates the kind of work that is performed contractually, that is, explicitly for remuneration and in the employ by other
Labor can more properly be related to performing simplified work-components or tasks without engaging in their substantial coordination towards given purposes
Reading 8: Machine/organism dichotomy and free-market economics: Crisis or transformation?
Student: Mamedova Asel
