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Gift economy

A gift economy is an economic system in which participants give away things of value to the shared benefit of the community.

Gift economies were first formally recognized in the potlatch rituals of Native American societies in the Pacific Northwest. Leaders would give away large amounts of perishable goods to their followers.

The Western scientific tradition is an example of a gift economy. A scientist produces research papers and gives them away to other scientists, through journals and conferences. The other scientists are free to refer to the first scientist's papers. The more citations the scientist has, the more prestige and respect he has, which can attract funding and positions. All of the scientists benefit from an increased pool of knowledge.

The concept of a gift economy is also important in Chinese social relations and guanxi. People in Chinese societies will exchange gifts in order to cement social relationships.

A gift economy is an important cornerstone of the annual Burning Man festival.

Information is particularly suited to gift economics, as a given piece of information can be copied and transmitted indefinitely for practically nothing.

The open source software community can be thought of as an example of an information gift economy. Programmers make their source code available to the programming community, and anyone can modify and improve the code. Individual programmers gain prestige and respect, and the community as a whole benefits from better software.

Gift economies can co-exist with command economies, market economies and barter economies.

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