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 national fiscal policy. 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 being member of growing team populations, or the cascade of growing teams being members of bigger, growing teams, etc, etc, on up to a nation being the current peak metric for competing teams. An embryo that never stops growing faces an overwhelming organizational - i.e., maturity - challenge.  A growing human population faces even greater organizational challenges, as both numbers and personal degrees of freedom continuously increase. Nation-teams are the "moment" of adaptive modeling among humans. A more evolved world depends on national cultures racing to find a "better" way. One that other countries can emulate. Experimental results are always worked out soonest in model systems and survivable tests - not from experiments done on the entire system, which may be fatal.

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. Perhaps 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 increasing in raw numbers every year, seemingly less prepared to cooperate and coordinate, simply because their education is subtly neglected?

Here are a variety of comments and posts that mention the systemic return-on-coordination, in various contexts.

http://seekingalpha.com/article/1050011-fiscal-cliff-and-deficit-conversation-misses-the-point#comment-12560061
(note the next response, by zmoney; at least 1 person gets the obvious)

http://econintersect.com/b2evolution/blog2.php/2012/12/16/redefining-fiscal-policy-outcomes-so-that-our-definition-of-successful-investing-isn-t-depriving-our-grandchildren-of-options

http://econintersect.com/b2evolution/blog2.php/2012/08/30/in-economics-a-gaping-separation-between-theory-and-operations

USMC on Warfighting (see section on "decisionmaking")
http://community.marines.mil/news/publications/Documents/MCDP%201%20Warfighting.pdf

USMC on Campaigning
http://www.clausewitz.com/readings/mcdp1_2.pdf

USMC on Strategy
http://www.clausewitz.com/readings/mcdp1_1.pdf#zoom=100

No one researches this more than military groups, who don't always share their latest writings. However Older Military articles can be found here:
http://www.clausewitz.com/readings/Readings.shtml

Further links:

http://mikenormaneconomics.blogspot.com/2012/08/return-on-coordination.html

http://mikenormaneconomics.blogspot.com/2012/10/how-to-explain-return-on-coordination.html

http://mikenormaneconomics.blogspot.com/2012/12/fiat-is-miraculous-no-its-called-return.html


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).
http://people.biology.ufl.edu/ulan/pubs/Dual.pdf
http://people.biology.ufl.edu/ulan/pubs/Goerner.pdf
http://people.biology.ufl.edu/ulan/pubs/FISPAP.pdf