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The Information Society and the Information Economy

10 Oct 1997 19:44

The text which follows was mostly written in the 1990s, which explains, if it does not excuse, some of the now-dated references. (27 September 2020)
Does either exist?

It may seem very stupid to ask such a question on a Web page. (Indeed, some good friends have told me as much.) Pretty clearly the economic and political situation of the world today is very different from what it was, say, twenty or thirty years ago; one of the most popular explanations for these changes is that information technologies, especially computers, have in that time become powerful and ubiquitous, and so changed everything. Nowadays (goes the tale) we either have, or will shortly have, an information economy, as opposed to an industrial economy, and consequently an information society, as opposed to an industrial society. (We are all historical materialists now.) The Great Change is supposed to have happened since the end of the Second World War, and mostly since the 1970s.

I used to buy this notion without many reservations. In the last few years I've become more skeptical, mostly after reading Beniger's book on The Control Revolution. Beniger's key point is that you cannot have an industrial economy without a massive information-processing apparatus, just to keep track of things and make sure that everything gets where it's supposed to, when it's supposed to. Carriages or caravans might be able to run without timetables, clerks, and tracking; railroads cannot. The great innovations of information-processing were not so much machines as procedures: standardization, interchangable parts, printed forms, record-keeping, regularity, advertizing, management. The Great Leap Forward in information-processing took place, at least in this country, between 1880 and 1930, in which period the percentage of the workforce employed in information-handling grew from 6.5 percent to 24.5 (for scale, 35 percent of all US workers were industrial in 1930). The reason computers were able to spread so quickly, or part of it at any rate, was that they could replace in one box many information-processing tools which already existed --- adding machines, switching circuits, typewriters, punch-card tabulators, human computers, etc., etc.; in other words they filled existing niches, rather than having to carve out a new one, which would have been much more difficult. (IBM was a huge company before computers came along.)

Beniger's documentation is, as I said, impeccable, at least for the United States. I think we simply have to take it as given that industrial economies have always had big information economies, and that there's no way around this: "We have always been informational." I think this disposes of the idea that our economy is now or will be soon "post-industrial" in any real sense. (We're post-agricultural, and thank the gods, but that's a different story.) This leaves us with at least three puzzles. First, why did no one twig to the information-processing side of industrialism until after World War II? (Or, if they did, why didn't the insight go anyplace?) Second, what has caused the changes of the last few decades? Third, why is the information-age explanation so prevalent, if at least one of its premises is badly flawed?

I have no idea how to answer the first one; the only thing I can think of is that we just didn't have the notion of "information", abstracted almost entirely from its content, to play with, but this is almost question-begging: why didn't that notion exist yet? (Cf. cybernetics.)

As to the second, it's entirely possible that the introduction of specific new information technologies is responsible. Computers, both hardware and software, seems to be following the usual life-cycle for new, successful industries: initial diversification, lots of small firms, rapid growth, a huge number of failures, concentration of capital and control into a few huge firms, plus small specialized firms more or less dependent on the big ones. This is going to disturb all the existing industries, even internally, but so did, e.g., electrification. I have no idea how much such effects might explain.

(In the early stages, there are always plenty of people around to talk about the virtues and/or re-birth of entrepreneurship, the end of economic dinosaurs, the conquest of space and time, how the new technology will help usher in the Millennium, etc., etc. One could take speeches delivered at the Great Exhibition of 1851 in the Crystal Palace at London, lay them beside pieces from the '10s, '20s and '30s on aviation, or from Wired, and Newt Gingrich, and, after a bit of simple search-and-replace, the principal change would be the awful decline in the standards of public prose.)

Another plausible suggestion is that, simply because computers are more efficient information tools, they let previously-existing trends (like concentration of control and long-distance exchange) be pushed further. --- Both these lines of thought assume that the economy is not becoming decentralized, that George Gilder (among others) is wrong. That's fine, because, at least in terms of control, it's not, and he is. (See Bennett Harrison, Lean and Mean, for example.)

As to the third, a good answer would probably involve producing a good theory of ideology. I don't have one. Collectively, we seem to be in the position of a dim cousin of M. Jourdan, thinking we've just begun to speak prose. Why this notion should be appealing, I'm not sure. Certainly there are now an awful lot of people whose work depends on computers, and no doubt they benefit from a sense that they are Building the Future and Ushering in a New Age. And, while one can twist the information age idea around a lot of ways, so as to make it justify practically any policy one wants, the most common forms justify a lot things powerful people in business and government would like to do anyway (not always from economic reasons; I doubt that the military could excuse, on strict cost-benefit grounds, what it's spent on AI over the decades, but teaching computers new tricks is undeniably very neat, and much easier to justify with some information-age rhetoric than without).

Of course, if all this is even half right, it strengthens a generalization I'm fond of, that societies' self-conceptions (that is, ideas about what a society is like that are widely-distributed and respectable within that society) are usually wrong. (The Industrial Revolution, for instance, wasn't even named until --- the 1880s.)

Still, now that we're aware, maybe too aware, that we speak prose, we might as well learn to speak it well...

Who has access to information and networks, and how? Who controls different sorts of information and different forms of it? Who legally owns it? Does is an information-glut an effective alternative to censorship? Does specifically modern information technology really destablize authoritarian governments? (If so, warn Singapore.) How does the quality of information (its reliability, concision, salience to the task at hand, etc.) enter into its economics and processing? Who are the "information poor", and what happens to them in self-conceived information societies? How old is the notion of post-industrial or information society (are they always joined?), and where did it come from and how did it spread? Just how has the economy changed in the last few decades, and how does this connect with changes in the way we handle information, and changes in society and culture? What can we say about information societies in general, now that we've got, at a guess, 150 years of history on them? (That's a book I'd really like to write, and I even know the title: The Crystal Palace; or, The Wired Ideology.)

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