Concatenate Coordination and Mutual Coordination

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Concatenate Coordination and Mutual Coordination

• By Dan Klein and Aaron Orsborn
• Feb 2009
• Link to paper

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Lets check the dictionary

• Two definitions of the verb to coordinate
• Transitive - verb takes a direct object
• A businessperson coordinates factors of
  production to make profits
• Concatenate
• Intransitive - no direct object
• Coordinating with one another, to a focal point
• Japanese drive on the left
• Mutual

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Two usagesConcatenate and Mutual
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Mutual Coordination

• The mutually intermeshing of behavior
• Usually manifest, the actors can be made aware of
  their mutually coordinated action
• Depicted as a coordination game

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A coordination game with two coordination
equilibria
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Concatenate Coordination

• Concatenation chain, pattern, arrangement
• Concatenate coordination may refer to a
  concatenation that is coordinated top-down, or a
  concatenation lacking top-down direction.
• Better coordination means more pleasing to the
  mind imagined to behold the concatenation.

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The Interrelation of the two

• The big picture view from the boardroom is the
  aspirational concatenation - the plan
• There are myriad instances of mutual coordination
  within the firm
• The referent concatenation subsumes many
  instances of mutual coordination

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Golfing facilities

• Suppose there is an owner of a golf course and an
  owner of a golf school.
• From the Schelling point of view, each has his
  individual interests, and each mutually
  coordinates his own plans and actions with those
  of the other.
• However, there is also a sense in which the two
  form a cooperative unit that coordinates the set
  of golf facilities in the concatenate sense.
• But such isomorphism between the two
  coordination occurs only when the mutual
  coordinators are also the chiefs of the
  referent concatenation.

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In the Beginning

• Herbert Spencer, First Principles
• He compared society to an organism.
• He wrote of complexity as higher levels of
  coordination of functions within the organism.
• Concatenate coordination.

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The Beginning in Economics Concatenate
Coordination in the Firm

• Simon Newcombs Princeton Review paper The
  Organization of Labor (1880)
• Others John Bates Clark, Thorstein Veblen, Frank
  H. Knight,
• Focused on entrepreneur/owner/manager as the
  coordinator within the firm

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• Coordination within the firm was a quality of the
  concatenation. It invoked a judgment imputed to a
  mind imagined to behold the referent
  concatenation.
• It is natural for the beholder to correspond to
  the owners, and to assume that the criterion
  behind coordinativeness was honest profits a
  fairly precise and accurate rule.

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From the Firm to the Economy

• But when Hayek, Coase, etc. took the idea of
  coordination beyond the firm, the precision and
  accuracy melted away.
• For the vast concatenation, the imagined beholder
  is much less clearly defined.
• That did not stop them, however, from talking
  about coordination of the vast concatenation.
• Concatenate coordination invokes a Smithian sort
  of beholding, a figurative being.

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Coordination and the LSE

• Hayeks 1933 lecture at the LSE
• Extended the idea to the entire economic system.
• Beyond that of an actual coordinator.
• Not entirely novel, but LSE brings it to the
  center of Anglo-American economics
• Ronald Coase The Nature of the Firm (1937)
• Arnold Plant
• W.H. Hutt

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Mutual Coordination Emerges

• Things started to change with the advent of
  Thomas Schelling and game theory
• Schellings The Strategy of Conflict (1960)
• Coordination is something we hope to achieve in
  our interaction with others
• David Lewis developed the idea of coordination
  equilibrium in his book Convention (1969)

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Mutual is now dominant

• JSTOR search of QJE, EJ, JPE, AER, and Economica
  for coordination in 2001 and 2002
• 75 articles found
• 6 concatenate
• 40 mutual
• 11 ambiguous
• 19 not applicable

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Reversal
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Quiz Mutual or Concatenate?

• Phil Wiest coordinated the schedule of classes
  with the everyones stated preferences in mind.
• I need to coordinate with her to pick up my
  Craigslist items.
• By playing according to the sheet music each
  musician coordinates with the other musicians.
• The decorator has beautifully coordinated colors
  and patterns.

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Cooperation defined in terms of the two
coordinations

• Cooperation the mutual coordinating of eachs
  actions in a context in which each cooperator
  perceives, however fuzzily, to be making a
  contribution to the same referent concatenationa
  good team performance, a clean neighborhood, a
  productive bread factory. There is a mutual
  awareness of cooperating in the achieving of the
  concatenation.
• The spirit of cooperation is especially
  pronounced when there is not only mutual
  awareness but mutual sentiment in the experience.
  We did it together!

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Central direction vs spontaneous action

• Both concatenate and mutual coordination have
  spontaneous manifestations to go along with
  centrally directed ones
• Spontaneous order
• The vast concatenation that produces a woolen
  coat
• Spontaneous emergence of conventions
• Languages, monies, and norms

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Reasons to care

• Helps us appreciate concatenate coordination
• The grand concatenation What satisfies the mind
  imagined to behold it?
• The matter is not only instrumental, but also
  what the aesthetic sensibilities are.
• Adam Smith said of the rules of elegant and
  sublime writing loose, vague, and
  indeterminate.
• The decline of concatenate coincides not only
  with the rise of mutual, but the rise of
  efficiency and optimality, and modernist and
  positivist images of science.

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Mutual shouldnt overshadow concatenate

• Concatenate came first and must not be
  overshadowed by mutual
• The two typically interrelate in experience.
• But the two are distinct.
• Both should be understood and utilized.
• The big issues are about the big concatenation.

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Does Efficiency make Concatenate Coordination
Nugatory?

• Lets admit the vagueness of efficiency
• diminishing marginal utility of wealth
• The hypothetical nature of propositions, giving
  rise to ambiguities in, for example, the
  time-to-adjustment
• The collective action problems that might matter
  to the individuals contemplation of how much he
  would be willing to pay
• The issue of deeper, truer preferences
• Identity factors
• Future preferences
• The Smithian distinction between passive
  experience and moral agency
• Economists do not have good data

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• And when economic efficiency is confined to
  make it relatively precise and accurate, it
  really is a lower-level criterion for overall
  judgment.
• That is, narrower, more precise notions of
  economic efficiency are not a final arbiter of
  the social good.

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• I.M.D. Little A Critique of Welfare Economics
  (1957)
• Economic welfare is a subject in which rigour
  and refinement are probably worse than useless.
  It is satisfying, and impressive, that a
  rigourous logical system, with some apparent
  reality, should have been set up in the field of
  the social sciences but we must not let
  ourselves be so impressed that we forget that its
  reality is obviously limited and that the degree
  of such reality is a matter of judgement and
  opinion.

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• Behind our judgments are sensibilities that are
  sometimes better explored by openly aestheticized
  terms, such as concatenate coordination.

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• The End