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The key to networks is “trust.” This can only be achieved after people work
together on a common problem and find that others are able to keep secrets,
share valuable information, and exchange new ideas. The interactionist
economic theory (Clark and Fast, 2008) best describes, understands, and
explains how networks are created and operate. In themselves, networks are
neither theory or scientific. Instead, the understanding of networks allows both
the scholar and the business person to pursue shared goals. If networks are
institutionalized as formal permanent structures, they will implode from their
own administrative weight. The very notion or idea of a network is something
that exists at a moment or situation in time to accomplish some task(s). People
know one another and form the network to solve the problem at hand.
The basic issue for most people in firms is how to make the company
survive and grow during any particular point in time. They must not only be
free to move in the marketplace but also be secretive enough to protect its
privacy. More importantly, firms must have concern for others and their
environment. The public good must be protected because it is in the best
interests of the firm to maximize its profits for shareholders and executives
alike. The protection of the public good is essential in various infrastructures
and sectors (Clark and Lund, 2001). In recent months, the protection of the
transportation sector must be embedded in the government. The energy crisis
in California has clearly shown that the energy sector is a public trust. The
same could be argued for environment, water, as well as telecommunications.
In a highly dispersed system grid managers do not control much of the
system and must have control over ancillary service capacity to respond to
changes in generation quantity and location as they occur rather than have
control over all the generators. With new computer and monitoring technology,
this is more feasible and technologically efficient, although given the crisis the
utilities have been reluctant to engage in any experimentation or investment in
system change. The goal for the new civic markets is to help bypass the control
roadblocks of the old system and to facilitate the transition to an agile system
in the interest of the public good, even if the changes are not necessarily
beneficial to existing institutions in the short run.
A significant component at the microeconomic level is the use of “net-
works” or relationship between people and organizations. These personal
connections, partnerships, and relationships between technical staff and
separately between business executives are collaborations in which often
intense exchanges of information are commonplace. Some networks form in
many different ways, but primarily link businesses with compatible strengths
(and in some cases weaknesses) to achieve common goals. Other networks
form between government and private industry. Networks can form on hori-
zontal and vertical plains, depending on the nature of the interactions between
the actors, organizations, and situations involved.