The Future Is Decentralized – Patrick M. Byrne

The costs of centralizing information are higher than people understand. Until they have worked in actual organizations that have missions like fighting a war or making a profit, people tend to underestimate just how expensive it can be to centralize information.

If our mental picture of the world is like the pointy-haired manager in the Dilbert cartoons, we’ll tend to favor institutions where knowledge comes from the knowledge frontier, and is then moved to the central office where the managers sit and cogitate. The managers then push stupid orders back to the frontier.

And that pretty much describes the way collectivists want to organize the world. They don’t want there to be peer-to-peer consent because they think they can save a bunch of time and cost if everything can be centralized.

Hayek understood this well, especially in his 1945 article “The Use of Knowledge in Society.” This article influenced Thomas Sowell’s work in his books A Conflict of Visions and Knowledge and Decisions. And all of these works influenced me.

Thanks to the works of Hayek and Sowell, I’ve come to appreciate that whether we’re talking about business or social matters, life is all about avoiding the costs of centralizing information to some higher power that then spits orders out.

Read the rest via The Future Is Decentralized – Walden Labs

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