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Complexity
Volume 2017 (2017), Article ID 8358909, 9 pages
https://doi.org/10.1155/2017/8358909
Research Article

The Principle of Social Scaling

Department of Economics, New School for Social Research, New York City, NY, USA

Correspondence should be addressed to Paulo L. dos Santos

Received 21 April 2017; Revised 22 September 2017; Accepted 15 October 2017; Published 18 December 2017

Academic Editor: Sergio Gómez

Copyright © 2017 Paulo L. dos Santos. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

This paper identifies a general class of economic processes capable of generating the first-moment constraints implicit in the observed cross-sectional distributions of a number of economic variables: processes of social scaling. Across a variety of settings, the outcomes of economic competition reflect the normalization of individual values of certain economic quantities by average or social measures of themselves. The resulting socioreferential processes establish systematic interdependences among individual values of important economic variables, which under certain conditions take the form of emergent first-moment constraints on their distributions. The paper postulates a principle describing this systemic regulation of socially scaled variables and illustrates its empirical purchase by showing how capital- and labor-market competition can give rise to patterns of social scaling that help account for the observed distributions of Tobin’s and wage income. The paper’s discussion embodies a distinctive approach to understanding and investigating empirically the relationship between individual agency and structural determinations in complex economic systems and motivates the development of observational foundations for aggregative, macrolevel economic analysis.