Friday, March 5, 2010

The Future of Industrial Man, 3: Mercantile Society of the 19th Century (pt 2)

Drucker argues that we believe that we still live in a mercantile society but that we do not. Production has changed and is no longer tied to a specific location or a special climate. It is no longer the monopoly of a single country but can move to follow economic efficiencies. Because of this, trade is no longer complementary, in which one country trades the products of its land for products of another region, but competitive. Participation in the market becomes a competition to see who can use resources most efficiently.

I am still trying to grasp the changes that Drucker sees. He has a way of defining an idea in a single word or a phrase and then repeating those words without further elucidation. In Drucker’s new world, we apparently organize our lives around methods of production: how we generate electricity, how we make wine, how we create nails, to identity three examples that have appeared in the historical economics literature. Our connections to the good is through our participation in the process, not because we own a certain piece of land or live in a certain climate. If the process changes, then our relationship changes in an instant. Once we may have controlled the good or service. In a moment, that control is gone. The property represented by that good or service may still trade on the market but our relationship to it is now quite different. We cannot gain social status or function from it.

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