The History and Future of Social Division of Labor: From the Corporation to the DAO to the SO-DAO

Social division of labor refers to the differentiation and specialization of various functions and activities in social production. It is an important means to improve efficiency and innovation, as well as a mechanism for social collaboration and value distribution. Self-organization refers to the phenomenon where unordered systems form ordered structures through internal interactions. It is a trend towards higher levels of coordination and collaboration. This article will discuss the process and significance of the transition from division of labor to self-organization in the following aspects:

(Note: This article is lengthy, readers can choose to read selectively)

• The historical development of division of labor, explaining the different views of important economists on division of labor.
• The impact of division of labor on economic development, analyzing the limitations of the corporate system and the rise of DAO organizations, and exploring what kind of organizational forms the digital economy needs.
• The key elements required for DAO organizations to evolve from autonomous organizations to self-organizations. Currently, DAO organizations are still only autonomous organizations, not self-organizations. From the perspective of organization evolution, process, and purpose, what role can AI technology play?
• The relationship and differences between self-organization and synergetics.
• The evolution of the DAO organizational model into self-organization (SO-DAO), through the implantation of the theory of AI technology and synergetics into the DAO model, allowing the DAO organizational model to evolve into a self-organization (SO-DAO) model.
• The important role of self-organization (SO-DAO) in the digital economy.

1. The Development History of Social Division of Labor

The social division of labor is a significant aspect of human social development. It evolves in response to changes in productivity, modes of exchange, technological levels, and other factors. The social division of labor entails the differentiation and specialization of functions and activities in social production. It also encompasses the relationships and structures between different subjects and objects. This division is crucial for enhancing efficiency and fostering innovation. Additionally, it serves as a mechanism for social cooperation and the distribution of value.

The development history of social division of labor can be divided into the following stages:

Primitive Society: In primitive society, humans mainly relied on gathering, hunting, and fishing for their livelihoods. The social division of labor was mainly based on age and gender, such as men being responsible for hunting and women being responsible for gathering. This division of labor was simple, natural, and unstable, and did not form fixed professions and ranks.

Agricultural Society: In agricultural society, humans began to use agricultural tools and livestock for cultivation. The social division of labor was mainly based on land and wealth, such as landlords, farmers, craftsmen, merchants, etc. This division of labor was complex, artificial, and stable, forming fixed professions and ranks.

Industrial Society: In industrial society, humans began to use machinery and electricity for production. The social division of labor was mainly based on technology and knowledge, such as engineers, technicians, managers, workers, etc. This division of labor was meticulous, professional, and dynamic, forming diverse professions and ranks.

Information Society: In the information society, humans began to use computers and networks for communication. The social division of labor was mainly based on information and services, such as programmers, designers, consultants, educators, etc. This division of labor was flexible, innovative, and open, forming diverse professions and ranks.

In history, various economists have had different understandings and evaluations of division of labor. Here are some representative viewpoints:

Adam Smith: He is the author of “The Wealth of Nations” and the father of modern economics. He believes that division of labor is the main reason for wealth creation. It allows people to focus on their areas of expertise or interest, thereby improving the quality and quantity of production. It also promotes the accumulation and dissemination of knowledge. He uses the famous example of the pin factory to illustrate the efficiency improvement brought about by division of labor. He also introduces the concept of market mechanism, which suggests that people, in pursuing their own interests, achieve resource allocation and value creation through market exchange, as if guided by an invisible hand.

Karl Marx: He is the author of “Capital” and the founder of Marxist theory. He believes that division of labor is the root cause of exploitation and alienation. It deprives people of control and ownership over their own labor results, as well as the realization of their inherent abilities. He uses the concepts of commodity fetishism and labor alienation to illustrate the contradictions and crises brought about by division of labor. He also proposes the theory of class struggle, suggesting that people, when oppressed and deprived, achieve social transformation and value liberation through revolutionary struggle, as if driven by a historical law.

Emile Durkheim: He is the author of “The Division of Labor in Society” and one of the founders of sociology. He believes that division of labor is the foundation of social solidarity and order. It creates interdependence and mutual complementarity among people, forming a diverse and complex social structure. He uses the concepts of mechanical solidarity and organic solidarity to explain the social changes and adaptations brought about by division of labor. He also introduces the concept of social facts, suggesting that people, by obeying norms and values, achieve social integration and value consensus through social institutions, as if constrained by an external force.

The above is a brief introduction to the development history of division of labor. It can be seen that division of labor not only affects economic production, but also impacts social organization, political change, cultural inheritance, and other aspects. It is a phenomenon that has both advantages and disadvantages, and requires constant balance and adjustment.

2. The Impact of Division of Labor on Economic Development

The division of labor has a profound impact on economic development, both promoting economic growth and triggering economic crises. Here are some specific effects:

Promoting Economic Growth: The division of labor makes production activities more specialized and refined, thereby improving productivity and quality while reducing production costs and time. It also increases the frequency and scope of exchange activities, expanding market size and range, and increasing the variety and quantity of goods. The division of labor also stimulates innovation, driving technological progress and knowledge accumulation, and creating new products and services. All of these contribute to economic development and prosperity.

Triggering Economic Crises: The division of labor increases heterogeneity and isolation in production activities, resulting in information asymmetry and conflicts of interest between producers and consumers, leading to market failures and resource wastage. It also makes exchange activities more complex and unstable, increasing market fluctuations and the risk of contagion, resulting in financial crises and economic recessions. The division of labor further intensifies competition and disruption in innovation activities, leading to technological redundancy, moral risks, social injustices, and environmental pollution. All of these are detrimental to economic stability and sustainability. Given the dual impact of the division of labor on economic development, an appropriate organizational form is needed to coordinate the various factors and relationships involved. The traditional form is the corporation, which is a centralized organization based on principles such as legal personality, shareholding, and hierarchy. A corporation has the following characteristics:

• Legal Status: A corporation is an independent entity with legal personality, allowing it to engage in various legal activities and enjoy corresponding rights and obligations.
• Share Ownership: A corporation is formed by multiple shareholders who jointly contribute capital. Shareholders can acquire or transfer ownership of the company through buying and selling stocks, with their returns and risks proportional to the company’s profits and losses.
• Hierarchical Management: A corporation is organized into different levels and departments based on functions and positions. Each level and department has its own power and responsibilities, with communication and collaboration between superiors and subordinates through commands and feedback.
• Market Competition: A corporation operates in a market environment, needing to formulate its products and services based on market demand and supply. It also needs to compete and cooperate with other companies to gain a larger market share and profits.

The corporation can to some extent adapt to the economic development brought by the division of labor, enabling centralized resource allocation and achieving economies of scale and standardization in production. However, the corporation also has limitations and issues, such as:

• Information Asymmetry: There is information asymmetry within the corporation, where managers and employees, shareholders and the board of directors, and the company and consumers do not fully share or accurately reflect information. This can lead to decision-making errors, incentive failures, and a lack of trust.
• Conflicts of Interest: Conflicts of interest arise within the corporation, with different levels, departments, and shareholders having inconsistent or mutually exclusive interests. This can result in power struggles, resource wastage, and decreased efficiency.
• Innovation Dilemma: The corporation faces an innovation dilemma, as it tends to maintain existing products and services to preserve stability and advantages, while neglecting or resisting new ones. This can lead to a decline in innovation capabilities and weakened competitiveness.

With the rise of the digital economy, traditional companies are finding it increasingly difficult to adapt to the new challenges and opportunities brought about by division of labor. The digital economy refers to a new form of economy based on digital technologies such as the internet, blockchain, and artificial intelligence. It has the following characteristics:

Data-driven: The digital economy is an economic form where data serves as the core resource and value carrier. Data can be used in various processes such as production, exchange, and innovation, thereby improving efficiency and quality while reducing costs and time.

Networked: The digital economy is an economic form built upon network infrastructure and platforms. Networks can connect various entities such as individuals, companies, and institutions, as well as objects such as devices, products, and services, thereby expanding scale, scope, variety, and quantity.

Intelligent: The digital economy is characterized by intelligence as both a feature and a goal. Intelligence can be applied in analysis, prediction, decision-making, and other processes, thereby enhancing flexibility, adaptability, and risk management. The digital economy requires a new form of organization to coordinate various factors and relationships in division of labor. This form of organization is called a Decentralized Autonomous Organization (DAO), which is a decentralized autonomous organization based on blockchain technology and smart contracts.

DAO organizations have the following characteristics:

Decentralized: DAO organizations are organizations without a central governing body. Ownership and control are distributed among members, who can decide on the organization’s goals, rules, resources, and actions through voting and negotiation.

Autonomous: DAO organizations are self-managing and self-executing. Their operations and development rely on internal smart contracts and algorithms, rather than external laws or institutions. Smart contracts are automatically executable digital protocols, while algorithms are automatically adjustable digital rules.

Open: DAO organizations are open and transparent. All data and information are stored on the blockchain, which is a distributed and tamper-proof database. Anyone can view and verify the status and history of a DAO organization, as well as join or leave it.

DAO organizations can, to a certain extent, adapt to the challenges of the digital economy by facilitating resource intermediation and sharing, as well as production delimitation and collaboration. However, DAO organizations also face certain challenges and issues, such as:

Technological Difficulty: DAO organizations rely on advanced and complex digital technologies such as blockchain, smart contracts, and artificial intelligence. These technologies not only require significant costs and time, but also demand high levels of expertise and skills, posing a significant barrier for ordinary users.

Social Barriers: DAO organizations need to navigate various norms and values in society, such as laws, ethics, and culture. These norms and values may not align with or may conflict with the ideals and culture of DAO organizations, leading to misunderstandings, lack of recognition, lack of support, or even opposition in society.

Human Challenges: DAO organizations need to consider various human factors and influences, such as emotions, trust, and responsibility. These factors and influences may not align with the logic and mechanisms of DAO organizations, resulting in people’s resistance, dissatisfaction, non-participation, or even deviation from DAO organizations.

Due to the dual impact of DAO organizations on the digital economy, there is a need for a higher-level form of organization to coordinate various factors and relationships in division of labor. This higher-level form of organization is self-organization（SO）, which is a phenomenon where an unordered system forms an ordered structure through internal interactions.

Self-organization has the following characteristics:

Spontaneity: Self-organization is a process that does not require external control or guidance. It is driven by the dynamics of the system itself. The elements in the system adjust their behavior and interactions automatically based on their own states and the environment, thereby forming a certain order and structure.

Adaptability: Self-organization is a process that can adapt to external changes. It is achieved through the feedback mechanisms of the system. The elements in the system automatically change their states and environment based on external stimuli and influences, thereby maintaining or restoring the stability and balance of the system.

Innovation: Self-organization is a process that can create new patterns and functions. It is caused by the variability mechanism of the system itself. The elements in the system generate new variations and combinations through their interactions, thereby forming new characteristics and capabilities.

3. Key Elements for the Evolution from Autonomous Organizations to Self-organizations

While DAO organizations have characteristics such as decentralization, autonomy, and openness, they are not truly self-organizing. This is because DAO organizations still require human intervention to establish rules, participate in decision-making, and execute tasks. They have not achieved complete spontaneity, adaptability, and innovation. From the perspective of organizational evolution and purpose, the transition from division of labor to autonomous organizations and eventually to self-organizations represents a trend towards higher levels of coordination and cooperation. AI technology can play a significant role in this process by helping DAO organizations achieve more intelligent, adaptive, innovative, and sustainable operations. Specifically, AI technology can:

• Provide more accurate, comprehensive, and timely information and recommendations through data analysis, machine learning, natural language processing, and other methods, assisting DAO organizations in making optimized decisions and plans.
• Facilitate more automated, flexible, and secure execution and supervision through mechanisms such as smart contracts, algorithmic governance, and market prediction, reducing operational costs and risks for DAO organizations.
• Create more diverse, high-quality, and valuable products and services through technologies like generative adversarial networks, reinforcement learning, and neural networks, enhancing the competitiveness and influence of DAO organizations.
• Promote more harmonious, inclusive, and fair collaboration and communication through theories such as affective computing, collective intelligence, and game theory, strengthening the cohesion and trustworthiness of DAO organizations.

To evolve DAO organizations from autonomous organizations to self-organizations, besides AI technology, several key elements are required:

Shared Vision and Values: DAO organizations need to have a clear goal and direction, as well as a set of values that align with their philosophy and culture. This enables members of DAO organizations to have a sense of common identity and belonging, as well as the motivation to participate and contribute spontaneously. Shared vision and values also help DAO organizations maintain unity and confidence in the face of difficulties and challenges, as well as innovation and flexibility when facing opportunities and changes.

Effective Communication and Negotiation: DAO organizations need a transparent and open communication and negotiation mechanism to ensure timely access to information, expression of opinions, proposal of suggestions, problem-solving, and consensus-building among members. Effective communication and negotiation can improve the quality and efficiency of decision-making in DAO organizations, as well as enhance their adaptability and learning capabilities. It also fosters trust, respect, and reduces potential conflicts and contradictions among members.

Fair Incentives and Evaluation: DAO organizations require a fair and reasonable system for incentives and evaluation to ensure that members receive appropriate rewards and feedback based on their contributions and performance. Fair incentives and evaluation can stimulate members’ enthusiasm and initiative, as well as enhance the productivity and competitiveness of DAO organizations. They also guarantee fairness and sustainability in the allocation of resources and values within DAO organizations.

Robust Security and Stability: DAO organizations need a strong security and stability mechanism to withstand external attacks and interference, as well as internal errors and failures. Robust security and stability protect the assets and data of DAO organizations and ensure their operation and development. They also increase members’ confidence in DAO organizations themselves and the technology platforms they use, such as blockchain and smart contracts.

4. Relationship Between Self-organization and Synergetics

Self-organization and Synergetics are both sciences that study the formation of structures and patterns in open systems when they deviate from thermodynamic equilibrium. They both fall within the scope of self-organization theory. However, they also have some connections and differences, mainly in the following aspects:

Founders and inspiration: The founder of self-organization theory is Ashby, a British psychiatrist and pioneer of cybernetics, who first proposed the concept of self-organization in 1947. The founder of synergetics is Haken, a German physicist and founder of laser theory, who was inspired by laser theory and proposed the basic principles of synergetics in the 1970s.

Research objects and methods: Self-organization theory mainly studies the phenomenon of the formation of ordered structures in disordered systems through internal interactions. It uses concepts and methods such as complexity, nonlinearity, chaos, and fractals. Synergetics mainly studies the phenomenon of collective behavior and pattern selection in multiple subsystems through dynamic coupling. It uses concepts and methods such as phase transitions, order parameters, and the Slavnovski equation.

Application areas and influence: Self-organization theory is widely applied in physics, chemistry, biology, sociology, and other fields. It reveals the mechanisms behind various ordered patterns in nature and human society, and is of great significance for understanding and controlling complex systems. Synergetics also involves multiple disciplines. It not only explains nonlinear phenomena in physical systems such as lasers and fluid dynamics instabilities but also extends to biological systems such as neural networks and brain functions, as well as social systems such as public opinion and language evolution, promoting interdisciplinary communication and cooperation.

5. Goal: Evolving from DAO to Self-Organization (SO-DAO)

To transform a DAO organization from autonomous to self-organization, we can draw inspiration from AI technology and the principles of collaborative learning and integrate them into the DAO model, creating a new form of self-organization called SO-DAO. SO-DAO is a self-organizing structure based on blockchain technology, smart contracts, principles of collaborative learning, and AI technology, and it possesses the following characteristics:

Synergy: SO-DAO is a form of self-organization that is implemented through the principles of synergetics. It uses concepts and methods such as phase transition, order parameter, and Slavnov-equation to describe the dynamical coupling and collective behavior between subsystems (such as members, resources, products, etc.) in SO-DAO, as well as the mode selection and mutation phenomena that may occur in SO-DAO under different control parameters.

Intelligence: SO-DAO is a form of self-organization achieved through AI technology. It employs methods such as data analysis, machine learning, and natural language processing to provide more accurate, comprehensive, and timely information and suggestions, assisting SO-DAO in making optimized decisions and plans. It utilizes mechanisms such as smart contracts, algorithmic governance, and prediction markets to enable more automated, flexible, and secure execution and supervision. It utilizes technologies such as generative adversarial networks, reinforcement learning, and neural networks to create diverse, high-quality, and valuable products and services. It applies theories such as affective computing, collective intelligence, and game theory to promote more harmonious, inclusive, and fair collaboration and communication.

Self-Organization: SO-DAO is a form characterized by spontaneity, adaptability, and innovation. It does not require external control or guidance but is driven, realized, and caused by the dynamic laws, feedback mechanisms, and variation mechanisms within SO-DAO itself. The subsystems within SO-DAO automatically adjust their behavior and interactions based on their own states and environments, thereby forming a certain order and structure. They also automatically change their states and environments in response to external stimuli and influences, thereby maintaining or restoring the stability and balance of SO-DAO. Through interactions, new changes and combinations emerge, resulting in new features and capabilities.

6. The Role of Self-Organization (SO-DAO) In The Digital Economy

Self-organization (SO-DAO) is a new form of organization that adapts to the division of labor in the digital economy. It can play the following roles in the digital economy:

Improve efficiency and quality: Self-organization (SO-DAO) can improve the efficiency and quality of information processing, execution supervision, and product innovation through the principles of synergetics and AI technology. This can help to reduce costs and time, and increase competitiveness and influence. The principles of synergetics refer to the phenomenon of multiple subsystems exhibiting collective behavior and mode selection through dynamic coupling. This can help the subsystems in SO-DAO to respond to external changes and internal needs in a coordinated and consistent manner, thereby forming more optimized solutions. AI technology refers to the use of methods such as data analysis, machine learning, and natural language processing to simulate human intelligent behavior and capabilities. This can help the subsystems in SO-DAO to acquire information more quickly, analyze problems more accurately, and execute tasks more effectively, thereby improving production quality and quantity. For example, SO-DAO can use the principles of synergetics and AI technology to achieve more intelligent supply chain management, thereby reducing inventory costs, improving logistics efficiency, and increasing customer satisfaction.

Enhance adaptability and stability: Self-organization (SO-DAO) can strengthen adaptability and stability to external changes through feedback mechanisms and AI technology. This can help to reduce risk and crisis, and improve flexibility and sustainability. Feedback mechanisms refer to the elements of a system automatically changing their state and environment according to external stimuli and influences, thereby maintaining or restoring the stability of the system. AI technology refers to the use of methods such as data analysis, machine learning, and natural language processing to simulate human intelligent behavior and capabilities. This can help the elements in SO-DAO to perceive the environment more sensitively, adjust strategies more flexibly, and solve problems more effectively, thereby improving the adaptability and learning ability of the system. For example, SO-DAO can use feedback mechanisms and AI technology to achieve more intelligent risk management, thereby reducing the probability of financial crises, improving financial stability, and increasing financial reliability.

Promote innovation and diversity: Self-organization (SO-DAO) can promote the creativity and diversity of new patterns and functions through mutation mechanisms and AI technology. This can increase variety and quantity, and improve value and significance. Mutation mechanisms refer to the production of new changes and combinations in the interaction of the elements of a system, thereby forming new features and capabilities. AI technology refers to the use of methods such as data analysis, machine learning, and natural language processing to simulate human intelligent behavior and capabilities. This can help the elements in SO-DAO to generate data more creatively, combine data more diversely, and utilize data more valuably, thereby improving the innovation ability and value creation ability of the system. For example, SO-DAO can use mutation mechanisms and AI technology to achieve more intelligent product innovation, thereby reducing R&D costs, improving product quality, and increasing product competitiveness.

Strengthen collaboration and fairness: Self-organization (SO-DAO) can strengthen collaboration and fairness between subsystems through the principles of synergetics and AI technology. This can increase trust, cohesion, consensus, and win-win. The principles of synergetics refer to the phenomenon of multiple subsystems exhibiting collective behavior and mode selection through dynamic coupling. This can help the subsystems in SO-DAO to respond to external changes and internal needs in a coordinated and consistent manner, thereby forming more optimized solutions. AI technology refers to the use of methods such as data analysis, machine learning, and natural language processing to simulate human intelligent behavior and capabilities. This can help the subsystems in SO-DAO to communicate and exchange more effectively, allocate resources more fairly, and evaluate contributions more reasonably, thereby improving the collaboration ability and value distribution ability of the system. For example, SO-DAO can use the principles of synergetics and AI technology to achieve more intelligent social governance, thereby reducing social costs, improving social benefits, and increasing social welfare.

Conclusion

Organizational models refer to the differentiation and specialization of various functions and activities in social production, as well as the relationships and structures between various subjects and objects. Organizational models are an important means to improve efficiency and innovation, and they are also a mechanism for social cooperation and value distribution. Organizational models continue to evolve as factors such as productivity, exchange methods, and technological levels change. They have influenced all aspects of economic production, exchange, and innovation. In the history of economics, economists have had different understandings and evaluations of organizational models, such as Adam Smith, Karl Marx, and Émile Durkheim. They have analyzed the pros and cons of organizational models for economic development from different perspectives, and how to balance and regulate the various factors and relationships in organizational models. Self-organization (SO-DAO) is a new form of organization adapted to the digital economy brought about by division of labor. It is a self-organizing form based on blockchain technology, smart contracts, synergetics principles, and AI technology. SO-DAO has the following characteristics: Synergy, Intelligence, and Self-organization. These characteristics enable SO-DAO to play the following roles in the digital economy: improving efficiency and quality, enhancing adaptability and stability, promoting innovation and diversity, and strengthening collaboration and fairness. These bring new driving forces to the social economy, such as reducing costs and time, improving competitiveness and influence, reducing risks and crises, enhancing flexibility and sustainability, increasing variety and quantity, improving value and significance, increasing trust and cohesion, and enhancing consensus and achieving win-win. We look forward to seeing SO-DAO play a greater role in the digital economy and bringing more value and significance to the social economy. We believe that with the development and application of digital technology, social division of labor will present a higher level of coordination and cooperation. The traditional company system is increasingly difficult to adapt to this change. We believe that SO-DAO is a new form of organization that can adapt to this change. It can overcome the limitations and problems of the company system, such as information asymmetry, conflict of interest, and innovation dilemma. We believe that SO-DAO is a trend towards higher levels of coordination and cooperation. It can achieve resource de-mediation and sharing, as well as production de-bordering and cooperation. We believe that SO-DAO is a form with spontaneity, adaptability, and self-innovation. It can form an orderly structure through internal interactions, thereby improving efficiency and quality, strengthening adaptability and stability, promoting innovation and diversity, and strengthening collaboration and fairness. This article aims to illustrate the importance of the development of organizational models in the economy, and the new drivers that self-organization (SO-DAO) brings to the social economy. We believe that with the development and application of digital technology, social division of labor will present a higher level of coordination and cooperation. SO-DAO is a new form of organization that can adapt to this change. It can improve efficiency and quality, strengthen adaptability and stability, promote innovation and diversity, and strengthen collaboration and fairness. We look forward to seeing SO-DAO play a greater role in the digital economy and bringing more value and significance to the social economy.

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