Wikipedia as an economic system

Back in the 1980s there was a movie, rather forgettable, called "Gung Ho." This movie dealt with the ability of American auto workers to match the Japanese. In the end the Americans match the Japanese monthly production record, ten thousand cars. (Or something) The catch was that the cars didn't have engines in them. A hollow victory, hilarious nonetheless.

This movie demonstrates very well what happens when the incentives of production become mismatched. The old Soviet Union was another example, say for instance you own a shoe factory back in the U.S.S.R. The Kremlin dispatches a message commanding ten thousand be produced. You would produce ten thousand baby shoes, basically because there is a shortage of leather. The guy at the leather factory factory is thinking just like you, and raw materials are in a shortage. You would hoard the leather left over, and trade it on the black market. There is no incentive to produce shoes that people want, you would only try and keep yourself from being thrown into the gulags -- for not following the instructions of the Kremlin.

Wikipedia is another example of collectivism, gone awry and not doing any good because of a mismatch of incentives. Many people stride into wikipedia with some knowledge, hoping to actually do some good. Only to find a power structure of editors, and admins that can be hostile. You then swear it off forever, in hatred of the "cabal." The utopian encyclopedia is now the gilded encyclopedia.

A good example of this is the swastika entry, which became the victim of an edit war. This website entry discusses this. The problem basically arose when the piece information regarding Nazis as national socialists was removed and replaced many many times. Revisionist history at it's best. Thousands of edits, by someone who thought hiding known history from wikipedia would somehow disassociate Socialism from the Nazis.

The completely anonymous system of wikipedia, basically shunts the incentive of producing quality entries to the bottom -- so it can push the "collective utopian ideal." Working to become the largest depository of never better than mediocre knowledge in the world.

This illustrates a problem known in environmental economics as "The tragedy of the commons." Common pool resources, such as cod fish stocks, can fall victim to this. More on this phenomenon in later posts.