A THOUSAND POINTS OF WEALTH

Networks promote this equity culture.

The ownership of organizations is distributed and decentralized into a thousand points. The transactional costs of owning a tiny share of someone’s else’s dreams and ambitions continues to drop so that it becomes feasible to possess, directly and indirectly, small parts of many companies. When you invest in a mutual fund, you invest in hundreds of thousands of other people’s work. You use the wealth that your own ambition has generated to seed the generation of prosperity by others. You may own only some minuscule portion of an enterprise, but you can easily own parts of many firms, and each firm is owned by millions of individuals. This is network equity.

Out of this distributed ownership a portrait of a network emerges. Millions of lines of investment crisscross the landscape. A few individuals own a lot, but the majority of nodes are dispersed into small bank accounts in small towns. The bulk of stocks in the United States are controlled by the pension funds of ordinary citizens–by millions of individuals in the aggregate. The workers of America really do collectively own the means of production.

 

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This is a blog version of a book of mine first published in 1998. I am re-issuing it (two posts per week) unaltered on its 10th anniversary. Comments welcomed. More details here.
-- KK