Participatory economics compensates based on effort and sacrifice, promoting equity, fairness, and solidarity while ensuring accountability within a structured system. In contrast, PWYW allows clients to decide payment based on their subjective experience of value, emphasizing trust, generosity, and autonomy but introducing uncertainty for workers.
Which model better aligns with principles of economic justice, economic self management, etc? Do these schemes conflict, or could these approaches complement each other in certain contexts? Let’s explore their strengths, risks, and the ideals they pursue?
Would not the PWYW method depend on the consumers having good information on the cost of production, in order to get a picture of the value they want to give toward that end?
I suspect it can get exhausting to pursue this for a multitude of goods and services one might want to make.
Is it unfair to see PWYW as a ‘tip’-based economy? If that comparison is fair, then I think this could introduce not only uncertainty for workers, but also unfairness. Tip-giving, I believe, is often based on trying to ‘hack’ certain human behaviors, rule-of-thumb thinking or unconscious biases. So this might lead to arbitrariness or at its very worst maybe even reproduce discrimination. I guess that for me, the strength of ‘tip’-giving sort of depends on the community and reciprocal behavior already being well-established. Unless there is a feedback mechanism in the community that can address anti-social behavior in a satisfactory way, I think PWYW could not do what a back-and-forth of information from councils can.
Also, I can imagine there might exist a product, where the market segment that is of interest for the product might not have enough purchasing power to - on average - meet in payments what the producers require.
It might very well be the case that a minority group of people do not possess enough purchasing power, but do need something, where the cost of production exceeds that. This means that the product, unless subsidized somehow, will not be produced for long. So then there would need to be ‘subsidy’ mechanism that addresses wealthy consumers to donate to products they themselves do not require. Depending on the context, this means that people who are more-impacted are dependent on the goodwill of those who are less-impacted recognizing and donating adequately a part of their surplus purchasing power.
Thank you for your thoughtful response and the important concerns you’ve raised about PWYW systems. I’d like to clarify that I wasn’t suggesting PWYW as a replacement for participatory economics compensation fully, but rather exploring how these systems might coexist and complement each other in different contexts.
You raise valid points about the potential issues with PWYW - information asymmetry, uncertainty, and the risk of reproducing inequities similar to tipping culture. However, I believe we can consider PWYW as one tool in a broader economic toolkit, rather than an all-encompassing solution.
For instance, basic needs and essential services could be compensated through the participatory economics model of effort and sacrifice, ensuring stability and fairness for workers. Meanwhile, PWYW might be appropriate for certain creative works, community projects, or supplementary services where:
The community already has strong solidarity networks
The basic needs of workers are already met through other compensation mechanisms
The work has variable perceived value for different users
The goal includes building stronger community bonds through trust and generosity
This hybrid approach would maintain the core benefits of participatory economics while allowing for flexibility in specific contexts where PWYW might strengthen community ties and economic self-management.
What are your thoughts on this more nuanced approach of using different compensation models for different contexts, rather than seeing them as competing alternatives?