How the Iron Law of Oligarchy Extends to Peer Production

Paper: Laboratories of Oligarchy? How the Iron Law Extends to Peer Production. By Aaron Shaw, Benjamin Mako Hill. Computers and Society (cs.CY); Social and Information Networks (cs.SI); Report number: ci-2014/96 

Abstract
“Peer production projects like Wikipedia have inspired voluntary associations, collectives, social movements, and scholars to embrace open online collaboration as a model of democratic organization. However, many peer production projects exhibit entrenched leadership and deep inequalities, suggesting that they may not fulfill democratic ideals. Instead, peer production projects may conform to Robert Michels’ “iron law of oligarchy,” which proposes that democratic membership organizations become increasingly oligarchic as they grow. Using exhaustive data of internal processes from a sample of 683 wikis, we construct empirical measures of participation and test for increases in oligarchy associated with growth. In contrast to previous studies, we find support for Michels’ iron law and conclude that peer production entails oligarchic organizational forms.P2P Foundation

How the Iron Law of Oligarchy Extends to Peer ProductionMichel Bauwens

The causal mechanism behind the "iron law of oligarchy" as democratic organizations grow is that the organization tends to become hierarchical above a certain number owing to the transaction cost of consensus decision making. Hierarchical organization, along with power relationships and structure, is simply more efficient, as Peter F. Drucker has convincingly argued about the development of the firm.

This is a reason that subsequent to the hunter-gather stage at which a sparse humanity could function more or less on consensus-building, the agricultural stage and then the industrial stages led to increasing organization and power relationship and structure, especially after the development of the ancient city-state as a political institution. This was a natural and evolutionary development in accordance with the law of least action, otherwise known as "water runs downhill."

This is the dilemma facing humanity since the advent of liberalism in the Enlightenment. There is an inherent tension between popular, participatory democracy and efficient organization. The social, political and economic challenge is to work out tradeoffs that enable humanity to recapture the liberty and dignity of Rousseau's noble savage"while also harnessing the advantage of modern organization and management.