By FERNANDO NOGUEIRA DA COSTA*
Decreased family utility through atomization and commoditization
“Atomization”, according to Branko Milanovic, in the book capitalism without rivals, refers to the fact that families have largely lost their economic advantage, as an increasing number of goods and services that were previously produced at home, outside the market and not subject to monetary exchange, can now be bought or rented in the market. Activities such as cooking, cleaning, gardening and caring for babies, the elderly and the sick were provided “free” at home in traditional societies, if the family was not very wealthy.
This was one of the main economic reasons for the existence of marriage: division of labor within the couple to increase “family productivity”. Living together “internalizes” these activities (cooking, cleaning, etc.) and provides economies of scale in everything, from food supplies to electricity.
However, with increasing wealth, almost all of these services can be purchased outside the home and there is less and less need to share one's life with other people. For this reason – and because of the entry of women into the workforce – contemporary societies (except in Africa) tend towards a minimum family size.
All household activities can now be outsourced. According to Branko Milanovic’s dystopian conclusion, the world would consist of individuals living and working alone (except when caring for children), without permanent ties or relationships with other people, and whose needs would be met by markets.
Atomization, taken to the extreme, implies the end of the family. It is also accelerated by increasing legal intrusions into family life when the rules existing within families are different from those in force outside them.
Many have the goal of minimizing contact with non-family members. This radical separation between family and non-family members was a feature found in most societies around the world until recently, a kind of sharing based on exclusion.
Today’s commodified model allows the outside world to invade the home not only in the form of meal deliveries and cleaning services, but also in the form of legal intrusions. These intrusions—such as prenuptial agreements and the ability of courts to remove children and control marital behavior—while often desirable, such as in preventing spousal abuse, further undermine the tacit internal covenant that holds families together.
The internal “legal code” of the family is outsourced to society as a whole. It raises the question: what is the advantage of family existence or cohabitation in a rich, commercialized world where all services can be purchased?
The use of wage labor from outside the home is part of a typical capitalist mode of production, with a clear distinction between production and family spheres – a distinction fundamental to defining capitalism. The new hyper-commodified capitalism unifies production and family, but it does so by incorporating the family into the capitalist mode of production.
Capitalism is moving towards “conquering” new spheres and “commoditizing” new goods and services. This stage of fully commercializing and/or negotiating all personal relationships traditionally left out of the market implies substantial improvements in labor productivity.
The counterpart of atomization is commoditization. In atomization, we are left alone because all our needs can be satisfied by what other people buy on the market. In full commoditization, we become that other: we satisfy people’s needs by commoditizing our assets, including our free time.
As consumers, we have acquired the ability to purchase activities that were previously provided in kind by the family. As producers, capitalism also offers a wide range of activities that we can provide to others. In this way, atomization and commoditization go hand in hand.
Cooking has become outsourced and families no longer eat all their meals together. Cleaning, repairs, gardening and childcare have become more commercialized and are no longer “housework.”
The growth of gig economy – the “on-demand” or “gig” labor market with temporary workers and no employment contract with companies hiring for specific services – commercializes our free time, including things owned but never used before for commercial purposes. Now, anyone with some free time can “sell it,” for example, by working for a ride-sharing company or delivering groceries remotely.
A private car was “dead capital” and now becomes live capital if used as a “taxi” for companies like Uber. Keeping the car idle in the garage has become an opportunity cost.
Similarly, houses once lent for a week without compensation to family and friends have now become assets rented to travelers. These assets become commodities and acquire a market price.
Not using them is a clear waste of resources due to the opportunity cost. We are led to think of these activities as commercial goods or services.
New markets emerged when goods traditionally produced by households began to be produced by industry and marketed with much greater productivity through economies of scale with assembly lines. Today, the commoditization of services is exactly the same process.
Personal services are harder to commoditize because productivity increases are harder by definition: service requires direct encounter between producer and consumer. Therefore, the gains from the division of labor are smaller.
For Branko Milanovic, the commodification of the previously non-commercial tends to make people do many different jobs. Even, as in the case of renting apartments or houses, it tends to turn them into “capitalists” in their daily lives.
The type of work emerging in the 21st century is not the type considered desirable by Max Weber because the worker lacks a sense of vocation or dedication to a profession. It lacks a systematic and methodical character.
Workers without any personal characteristics become, from the employers’ point of view, completely interchangeable “agents”. For Branko Milanovic, these three events are interrelated: (i) change in family formation (atomization), (ii) expansion of commoditization into new activities and (iii) fully flexible labor markets with temporary occupations.
If they stay in the same job for a long time, individuals try to establish trusting relationships with the people they interact with regularly. They engage in what is called “repeated games” with empathy and sympathy.
When new people show up and treat you like a complete stranger, you don’t have much incentive to behave “nicely” and send out cooperative behavior signals because these new people will soon be moving in too. Investing in being nice is a necessary effort if it’s justified by the expectation that this niceness will be reciprocated later on.
The professional assessment becomes whether he or she shows any “likability” despite the lack of lasting relationships. Why do we change our behavior when our interactions are commoditized? Because we are reduced to an economic function, because being nice is an investment, because the logic of being nice goes beyond market logic…
The spread of commoditization ends alienation. The order of things is internalized to such an extent that there is no longer anything without “pricing.”
The increasing commoditization of many activities, the rise of gig economy and a radically flexible labor market are part of the same evolution. They are movements toward a more rational but ultimately more depersonalized economy, where most interactions will be one-off contacts.
Atomization empties family life and the lack of personal interactions reduces the “sweet” behavior of commerce. It occurs in a context of amorality.
*Fernando Nogueira da Costa He is a full professor at the Institute of Economics at Unicamp. Author, among other books, of Brazil of banks (EDUSP). [https://amzn.to/4dvKtBb]
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