I already got some great feedback from two law school friends (!) re my previous entry on standardization that has helped me to substantially clarify my thinking. (Leave it to those sharp lawyers to poke holes in arguments). First, let me just say that my entry title was a deliberate provocative poke at the conventional wisdom that innovation is the fundamental source of increasing returns.
Though I alluded to a "virtuous circle" in my entry, I did not clearly understand the details of that circle. I think I have a better understanding now. First, I am using "standard" and "standardization" in a very broad way. As Rorty would say, I am redescribing them, and the test of my redescription is how useful it is in thinking more clearly about things. A "standard" in my vocabulary is nothing more than some degree of coordination among two or more systems (or one system with itself across time). If you think this an unreasonably broad definition, see the ASTM definition of standard, which is almost as broad: A standard is a common language that promotes the flow of goods between buyer and seller and protects the general welfare. Note how this definition is circular to the degree that common implies standard.) Clearly there is a dialectic process going on between system and environment involving standardization and both are being standardized by the dialectic. It is not just the system that changes, the environment (in the sense of the extended phenotype) changes as well, e.g., the dam built by the beaver.
But a much more important dialectic is going on as well: a continual transition from standardizing (coordinating) to innovating (disrupting the established coordination). It is this dialectic (or dynamic equilibrium?) of standardization/innovation, stasis/change, or solidarity/irony (for you Rortians) that is the fundamental source of increasing returns. Thus the speed with which a system can shift from a standard to an innovation, and the range of innovations it can generate both determine its evolvability, which is the source of increasing returns.
Once again, I see dualities where once I saw opposites. Perhaps the most satisfying duality is the solidarity/irony duality. I never found Rorty's exhortations to embrace solidarity very convincing. I now see clearly that irony, which has intrinsic appeal to me (and most everyone) cannot exist without a "solidarity" to react against.
5:18:21 PM 
