In "Conflict", Simmel investigates the nature of conflict within interactions and the effect that it has on groups. Notably, his starting point is not how conflict detracts from interaction and sociation, but how it contributes to it. He views the mix of closeness and hostility between individuals not as subtractive but as additive: for Simmel, a measure of the nature of interaction isn't performed by quantatively subtracting the feeling of hostility from the feeling of closeness, but by qualitatively examining the way in which both combine and define the relationship overall. He examines different kinds of conflict in terms of how they affect interpersonal relationships, how they affect the psychology and development of individuals, and how they affect both the internal relationships within groups and the external relationships that they have with other groups. The latter aspect of analysis also includes the effect that conflict has on the structure of groups themselves.
Acknowledging that conflict can be destructive, Simmel outlines how even conflict that is destructive in some areas can be constructive in others. His principle example of such an arrangement is in the specific type of conflict that he calls "competition" - where individuals don't come into conflict directly, but are encouraged to make individual effort, and the individual who wins, or makes the best effort at the time, gains some reward that was only available by taking part in the competition. Acknowledging that competition can harm some individuals if they expend effort but gain nothing, he notes its potential a source of individual improvement, and further notes that even in cases where it is destructive to individual interests, it can still serve the interests of the group overall. Simmel outlines the market as an example where the potentially destructive force of competition nevertheless benefits some individuals and, more importantly, provides benefits to the group as a whole regardless of the competition's outcome (though it should be noted that Simmel doesn't believe competition is always beneficial to society, and notes that the question of whether competition or coercive authority obtains the best overall group outcome is situation-specific).
In "The Web of Group Affiliations", Simmel attempts to trace the history of how groups developed. The analysis here is somewhat marred by Simmel's 19th-century adherence to the idea of social Darwinism, but it contains ideas of considerable interest nonetheless. Simmel views society as developing from more "primitive" forms of association to more "evolved" and "advanced" (read: more Western) forms of group organisation. Despite the problematic moral attitude taken to the history, his general understanding of differences between contemporary group formation and earlier group formation - at least, in the context of European history - is instructive. In particular, it is important to understand that membership in a group has an effect on the worldview and the consequent development of the self-identity of its members. For Simmel, a key difference between modernity and earlier times is the number of groups to which a person could belong. In small, "primitive" societies, people only have 1 group to which they belong, and that group largely defines their identity. In contemporary times, a multiplicity of groups abound, and individuals may voluntarily belong to whichever collection of groups suit their personal tastes. For Simmel,this proliferation of available group memberships and the individualism characteristic of Western modernity are inextricably related: the diversity of groups means that each individual will belong to a slightly different set of groups, and although each group will have a similar effect on the self-identity of the members of that particular group, each individual will be exposed to a different collection of group influences, and their identity will be almost if not entirely unique. Simmel examines what he perceives as the historical consequences of this transformation, interpreting it in terms of a transformation from a "formal" grouping pattern, grouped according to "external" criteria, into a "substantive" grouping pattern, according to "real" and "objective" criteria. The social Darwinist tendencies in his thinking are especially obvious here, but it is worth noting that Simmel distinguished formal from substantive groupings in terms of how they affect group purposes overall: formal groupings seem most natural and most effective, but substantive groupings are more rationally organised, and achieve specific and differentiated ends more efficiently.
Simmel never achieved the same level of name recognition as Karl Marx and Max Weber (a contemporary of Simmel), but his work has nonetheless been quite influential. His work on group affiliation forms the basis of the influential theories about privacy of Westin and Altman (especially Altman), and social networking theorists such as Wellman, Hampton and many others draw heavily on his work. This can be seen from reading "The Web of Group Affiliations" in conjunction with their work, theough curiously the many ideas expressed in "Conflict" have not found nearly as much favour in academia it seems. This is unfortunate, as understanding the role that conflict plays in daily interactions seems to be an important issue to examine in this Networked era, and Simmel's counterintuitive understanding of conflict as contributing to interactions and group cohesion could prove quite interesting in its application to current issues around, say, Facebook and the conflicts between Friends that can arise there.
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