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Lecture and open discussion with Rishab Aiyer Ghosh, New Delhi
Managing Editor of First Monday,
Deus X Machina

Diana McCarty, mikro e.V., Berlin/Budapest

DJ Manuela Krause

Rishab Aiyer Ghosh, ‘Cooking pot markets: an economic model for the trade in free goods and services on the Internet’ (full text)

'Cooking pot markets'


mikro.lounge #11
The Economies of Open Source

Wednesday, 3 February 1999, 20:00 Uhr
WMF, Johannisstr. 19, Berlin-Mitte 

ml#11 auf
Modem -- ISDN

deutsche Fassung

The concept of "Cooking Pot Markets" was the central theme of mikro.lounge #11. It has been developed for some time now by the Indian cultural scientist and sociologist Rishab Aiyer Ghosh of New Delhi. Rishab Aiyer Ghosh works as a journalist and media advisor and came to Berlin for the mikro.lounge.

Ghosh uses the metaphor "Cooking Pot Markets" to describe a form of market economy which is not oriented on the capitalist model of supply and demand. Instead, the gift and free exchange,  attention and personal esteem are the central categories. The metaphor is derived from the image of a small village community in which the people cook together so that individual ingredients (chicken or potatoes, etc.) are combined to create a rich, tasty meal. The image of free exchange and communal use is now being transferred to the Internet, where again, without monetary exchange programs, texts and other forms of content are exchanged, and where this form of free distribution also benefits the community.

"Cooking Pot Markets," says Ghosh, come about as a direct result of the distributed structure of the Internet: "People don't seem to want to pay -- or charge -- for the most popular goods and services that breed on the Internet. Not only is information usually free on the Net, it even wants to be free, so they say. But 'free' is the wrong word: like love, information, however free in terms of hard cash, is extremely valuable. So it makes sense to assume that the 3 million people on the Internet who publish matters of their interest on their home pages on the Web, and the several million who contribute to communities in the form of newsgroups and mailing lists, and of course, anyone who ever writes free software, believe they're getting something out of it for themselves. They are clearly not getting cash; their 'payment' might be the contributions from others that balance their own work or something as intangible as the satisfaction of having their words read by millions around the world."

After a half-hour introduction to his theoretical deliberations, the rest of the evening was devoted to an open discussion with the audience and members of mikro. During this phase, more central elements of Ghosh's theory came up for discussion, such as the relationship between monetary and non-monetary transactions in cooking pot markets and the precarious nature of "esteem" which can be won by participating in the gift economy of the Internet, that is, as the currency of this economy. Ghosh: "Ideas are sold for other ideas or an enhanced reputation; reputations are enhanced among buyers of ideas, and reputations are themselves bought and sold all the time for other reputations, as we shall see later. The basic difference is that reputation (or attention) is, like money, a proxy. It is not produced or consumed in itself, but is a by-product of underlying production of actual goods ('ideas' in our binary terminology)."

These principles were illustrated in the discussion with the concrete examples of mailing lists, content production and the development of software. These practices are closely bound to the medium of the Internet and one thing they have in common is that they are easily reproduced. Whether a text is read by ten or a hundred subscribers has no impact on the work required to produce it, but can make a difference in the amount of esteem for the author. The value of the work increases in that it is used by more people. Ghosh: "Much of the economic activity on the Net involves value but no money."

A concrete example of this form of production and the cooking pot economy is the open, collaboratively developed Linux software which was initiated by the Finnish programmer Linus Thorwalds and has attracted worldwide attention for a few years now. "Net gods get hungry, though, and reputation doesn't buy pizzas. So what does Torvalds do? As it turns out, he was still in the University of Helsinki (in October 1996, when I first interviewed him; he's now with an American company where 'it's actually in [his] contract that [to do] Linux part-time'). 'Doing Linux hasn't officially been part of my job description, but that's what I've been doing,' he says. His reputation helped -- as Torvalds says, 'In a sense, I do get my pizzas paid for by Linux indirectly.' Was this an academic sense, perhaps? Is Linux, then, just another of those apparently free things that has actually been paid for by an academic institution, or by a government? Not quite. Torvalds remained in the University out of choice, not necessity. Linux has paid back, because the reputation it's earned him is a convertible commodity. 'Yes, you can trade in your reputation for money,' says Torvalds, '[so] I don't exactly expect to go hungry if I decide to leave the University. 'Resume: Linux' looks pretty good in many places.'"

Linux offers a terrific example for the dynamics of the cooking pot economy, and so, it took on a central role in "Wizards of OS", a conference organized by mikro.

Rishab Ayer Ghosh is the Editor-in-Chief of the online magazine First Monday and has published numerous articles on the socio-economic and legal model of the Internet.


Rishab Aiyer Ghosh, ‘Cooking pot markets: an economic model for the trade in free goods and services on the Internet’ (full text)