In Praise Of The Middleman

It is easy to find people maligning the middleman. It is by no means a new historical phenomenon. Whether one is looking at insurance agents in the contemporary world of health care, or Jews in medieval Europe, or the Chinese in Southeast Asia, or Koreans in inner city America, one finds a consistent problem where the middleman is attacked for the problems that are involved in the economic system of a given situation. Today, I would like to take the unpopular stance of defending and praising the middleman.

Before we can praise the middleman, we must understand them. The essential aspect of the middleman is, perhaps unsurprisingly, being in the middle. And this is more important than we often think at first. The middleman inhabits the space between two groups of people who would otherwise not be able to effectively meet. The existence of the middleman implies the existence of a gap between what benefits those who focus on economies of scale and what is best for the people as well. Middlemen are thus often petit bourgeois who split up larger items into smaller sets that are inexpensive enough for common people to buy. Middlemen are also those who market goods and services to ordinary people and thus connect people who want something with the companies that sell them, but who do not always know who wants to buy such a thing.

When we talk about middlemen, we have to remember that they are not a problem. They are, in fact, a solution to a problem, and the fact that middlemen can thrive is strong evidence of the existence of a mismatch between the attitude of large companies and economic elites and what is needed and wanted by the public at large. The middleman takes the risks and properly reaps the rewards of providing valuable communication and information that other people want and need but are often unable to obtain easily and cheaply on their own. Again, the middleman is not the reason why two groups of people fail to come to terms on their own. The possibility of arbitrage, or the use of information gaps as a way of profiting, is something that allows for middlemen to exist and to thrive.

We should praise the middleman for a variety of reason, in light of the above. For one, middlemen provide communication on a variety of levels. Their existence demonstrates that elites are not in touch with the ordinary population and their needs. This is something that might be worth investigating a bit more, rather than making the middlemen a scapegoat for the larger problems of a society. Their behavior is further evidence of what sort of goods and services are useful and wanted by ordinary people, and something well worth investigating as well. The existence of niches where hard work and the acquisition of useful and practical knowledge is rewarded is something worth praising as well. There is much that needs to be done in this world and middlemen are largely the ones doing it, in the absence of others willing to undertake so much burdensome labor. And that is worthy of praise.

About nathanalbright

I'm a person with diverse interests who loves to read. If you want to know something about me, just ask.
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3 Responses to In Praise Of The Middleman

  1. Pingback: Run Over From Both Sides | Edge Induced Cohesion

  2. Catharine Martin says:

    I once worked for a company that was a middleman between a university and students who needed to attend it online because they lived outside the Denver, CO area. Our company provided the technical support services for this university that allowed these students to do so, which made us responsible for establishing, accessing and maintaining their classrooms. We also handled student enrollment, provided their books and learning materials–including shipping–to them, and all accounting issues. We definitely felt the brunt of it when things did not run smoothly. Being the middleman was very challenging, and often thankless work. But it was rewarding when the problems were solved. There was never a dull moment.

    • I have spent a fair amount of my own work life in that position as a middleman as well, and I find it somewhat disconcerting that brokers of one kind or another are viewed in such a negative fashion rather than providing the necessary interface between two parties that would not necessarily be able to come to terms on their own. It is a noble work, although, as you point out, there are many challenges in providing the technical services, infrastructure, and communication to keep things going.

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