To ⌞modern eyes living in a democracy with a well-functioning free market⌟, absolute monarchy and feudalism [1] (as were common for quite a while in history) seem quite stupid and suboptimal (there are some who may disagree, but I believe most will endorse this statement). From the perspective of an ideal society, our current society will appear quite similar to how feudalism seems to us—stupid and suboptimal—in large part because we have inadequate tools to handle externalities (both positive and negative). We have a robust free market which can efficiently achieve outcomes that are optimal in the absence of externalities, and a representative government that is capable of regulating and taxing transactions with negative externalities, as well as subsidizing transactions with positive externalities. However, these capabilities are often under- and over-utilized, and the representative government is not usually incentivized to deal with externalities that affect a small minority of the population represented—plus, when the government does use its mandate to regulate and subsidize, it is very often controversial, even in cases where the economic case for intervention is straightforward.
If the free market and representative government are the signs that separate us from feudalism, what separates the ideal society from us? If I had to guess, public goods markets (PGMs) such as quadratic funding are a big player—PGMs are designed to subsidize projects that have large positive externalities, and I suspect that the mechanism can be easily extended to discourage actions with negative externalities (although I worry that cancel-culture dynamics may cause problems with this)
[1] ‘Feudalism’ is understood in this context not just as a political structure, but also as an alternative to a free market
(NB: My use of the corner brackets ⌞ ⌟ is to indicate intended parsing to prevent potential misreadings)
If the free market and representative government are the signs that separate us from feudalism, what separates the ideal society from us?
The things that separate us from the ideal society will probably seem obvious from hindsight—assuming we get there. But in order to know that, large-scale experiments will be necessary, and people will oppose them, often for quite good reasons (a large-scale experiment gone wrong could mean millions of lives destroyed), and sometimes for bad reasons, too.
Frequently proposed ideas inclide: different voting systems, universal basic income, land tax, open borders...
To ⌞modern eyes living in a democracy with a well-functioning free market⌟, absolute monarchy and feudalism [1] (as were common for quite a while in history) seem quite stupid and suboptimal (there are some who may disagree, but I believe most will endorse this statement). From the perspective of an ideal society, our current society will appear quite similar to how feudalism seems to us—stupid and suboptimal—in large part because we have inadequate tools to handle externalities (both positive and negative). We have a robust free market which can efficiently achieve outcomes that are optimal in the absence of externalities, and a representative government that is capable of regulating and taxing transactions with negative externalities, as well as subsidizing transactions with positive externalities. However, these capabilities are often under- and over-utilized, and the representative government is not usually incentivized to deal with externalities that affect a small minority of the population represented—plus, when the government does use its mandate to regulate and subsidize, it is very often controversial, even in cases where the economic case for intervention is straightforward.
If the free market and representative government are the signs that separate us from feudalism, what separates the ideal society from us? If I had to guess, public goods markets (PGMs) such as quadratic funding are a big player—PGMs are designed to subsidize projects that have large positive externalities, and I suspect that the mechanism can be easily extended to discourage actions with negative externalities (although I worry that cancel-culture dynamics may cause problems with this)
[1] ‘Feudalism’ is understood in this context not just as a political structure, but also as an alternative to a free market
(NB: My use of the corner brackets ⌞ ⌟ is to indicate intended parsing to prevent potential misreadings)
The things that separate us from the ideal society will probably seem obvious from hindsight—assuming we get there. But in order to know that, large-scale experiments will be necessary, and people will oppose them, often for quite good reasons (a large-scale experiment gone wrong could mean millions of lives destroyed), and sometimes for bad reasons, too.
Frequently proposed ideas inclide: different voting systems, universal basic income, land tax, open borders...