A Yahoo Canada Open Question from the user chorle about Attention Economics. Yahoo Canada Question from chorle: "Do you think we are in an Attention Economy?".

My answer:
I think there has been a lot of disconnected writing about a phenomenon that has been poorly defined. In his 1971 speech, Herbert Simon said, "a wealth of information creates a poverty of attention, and a need to allocate that attention efficiently among the overabundance of information sources that might consume it." Later, in 1981, mathematical economist Sherwin Rosen provided some theoretical depth to this prediction in his paper, "The Economics of Superstars."

Several authors have argued that we have always lived in an attention economy, since social networks inherently involve the exchange of attention, which creates an economy. The relevant definition in this case is, "the management of the resources of a community, country, etc., especially with a view to its productivity." (Dictionary.com)

Michael Goldhaber was the first to use the term 'attention economy' and offered this definition (1997) when contrasting it to the information economy:

" ... if you have any particular piece of information on the Net, you can share it easily with anyone else who might want it. It is not in any way scarce, and therefore it is not an information economy towards which we are moving. What would be the incentive in organizing our lives around spewing out more information if there is already far too much? [...] There is something else that moves through the Net, flowing in the opposite direction from information, namely attention. So seeking attention could be the very incentive we are looking for."

Since his most concentrated period of publication in the late 90s, others have contested Goldhaber's definition (Aiyer Ghosh, 1997; Aigrain, 2006). While he has been working on a book for some time, several other authors pre-empted him, each with their own unique take on attention economics. In the end, what had the potential to be a well-defined concept ended up as a recycled meme meant to justify the general importance of social networking sites to the future of business.

If you need proof that there is competition for attention on the web, the long-necked (aka the long-tailed) power law distribution (Zipf's Law), turns up in plenty of research about attention allocation across the web (Huberman, 2002). Generally, attention will distribute unevenly across websites, with more attention concentrated among a tiny group of the total available sites. Also, any site that runs ads is tapping into the attention economy. Facebook, Google, LinkedIn and others sell ads where you might have to bid against competitors for the attention of the users who will be clicking.

I've talked about some of the future technologies that will help us measure, and therefore more easily commodify, attention. There are also some forward-looking descriptions of attention economies, such as Cory Doctorow's short-story, "Down and Out in the Magic Kingdom." It seems likely to me that our improving ability to track attention will result in an increase in its perceived value and the management technologies that help us invest and earn it.

TL:DNR - Attention is valuable and always has been, therefore attention economies have always existed within social networks, but the internet and mobile technology have made them much more tangible. We already sell and trade attention in the form of ads or promoted links, but advancing attention-tracking tech will permit much greater levels of sophistication in the design of future attention economies.

References:

  • Aigrain, P. (2006). Diversity, attention and symmetry in a many-to-many information society. First Monday, 11(6)
  • Aiyer Ghosh, R. (1997). Economics is dead. Long live economics! A Commentary on Michael Goldhaber’s “The Attention Economy”. First Monday, 2(5)
  • Goldhaber, M. H. (1997). The Attention Economy and the Net. First Monday, 2(4).
  • Huberman, B. A. (2002). Zipf’s law and the Internet. Glottometrics, 3, 143–150.
  • Rosen, S. (1981). The Economics of Superstars. The American Economic Review, 71(5), 845–858.
  • Simon, H. (1971). Designing Organizations for an Information-Rich World. Computers, Communication, and the Public Interest.