Network Effects

January 3rd, 2010

The term network effect describes the phenomenon in which a network, as it grows larger, increases its net power, productivity, utility, or some such. The standard example here is the use of email. When email first reached consumers in the 1980s, it wasn’t particularly useful because few of the people you knew had email accounts. However, ever time one more person obtained an email account, the overall utility of the email network increased, because that one person created as many new potential email linkages as there are already members of the network. For example, if you have a network of just three people, then there are only three possible pairings (1-2, 1-3, and 2-3). But if we add a fourth member to the network, then there are six possible pairings: 1-2, 1-3, 1-4, 2-3, 2-4, and 3-4. This process expands as the square of the number of members of the network. Thus, as networks grow, their utility increases dramatically.

I think that the network effect applies to ideas inside the mind. I’m not talking neurophysiology; I’m talking about a mental phenomenon rather than a neurophysiological one. The more ideas you have in your head, the more ways you can combine them to yield interesting new possibilities. Of course, not all email pairings are useful -- I have no interest in exchanging emails with most people on the Internet. In the same fashion, not all combinations of ideas yield interesting results; combining Newton’s First Law with "
ontogeny recapitulates phylogeny" doesn’t yield any useful insights to me. On the other hand, there are some combinations of ideas that yield fascinating results. When I earlier combined the concept of protein behavior to narrative, I came up with a fascinating result. Of course, in order to pull that off, I had to understand both protein behavior and narrative.

Sad to say, this realization has dark implications for young people. If you don’t have a big store of ideas in your head, you won’t have much in the way of network effects. It means that older people have a mental advantage over younger people. Society recognizes this, granting more power and authority to older people. Be patient, young-uns: just keep learning and your time will come.