Sunday, May 19, 2013

Revisiting the Basic Concept of Return-on-Coordination, and Wondering Why It's Missing From "Economics"

Commentary by Roger Erickson

A steady trickle of emails arrive, asking for more feedback about the basic concept of "return-on-coordination for beginners," and what the implications are for fiat currency operations and MMT. So here's a revisit to accumulating discussions - from the perspective of biology, military, and ecology fields. Please add your comments, with relevant references from other fields.

Return-on-coordination = growing teamwork. There's lots of literature on teamwork of course. However, there's far less discussion of scalable, growing teamwork in teams of steady increase of both team size AND teamwork. There's some relevant discussion of teamwork scalability, but mostly in ecology and military fields (e.g., "mobilization" processes in war campaigns).

So why not a similar literature about coordination as a dynamic form of capital? And more discussion of the scalability of teamwork in growing teams, nations and cultures?

One problem is that few think about all teams being members of bigger teams, etc, etc, on up to a nation being the current peak metric for competing teams. Nation-teams are the "moment" of adaptive modeling among humans. A more evolved world depends on countries racing to find a "better" way, one that other countries can emulate. Experimental results are always found first in model systems - not from experiments done on the entire system.

If you want to know about the economics of coordination, start with Walter A. Shewhart. "In all complex systems the highest cost, by far, is the cost of coordination."

Cost of coordination.

So if that's the highest cost. An obvious corollary is that the highest investment return, by far, is the return-on-(investment in)-coordination.

It amazes me that there's so little written about the return-on-coordination. Maybe most people in the know have always assumed the corollary to cost-of-coordination was obvious - while beginners who simply don't get the connection are constantly accumulating?

Here are a variety of comments and posts that mention the systemic return-on-coordination, in various contexts.
(note the next response, by zmoney; at least 1 person gets the obvious)

USMC on Warfighting (see section on "decisionmaking")

USMC on Campaigning

USMC on Strategy

No one researches this more than militaries, who don't always share their latest writings. However Older Military articles can be found here:

Further links:

Finally, some formal Autocatalysis articles, from the field of ecology
(self catalyzing = return-on-coordination, which turns into the question of what is being catalyzed by whom, short vs medium vs long term).

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