The economic rent is in the fact that there wasn’t an apple tree on your the walk to the store.
And we come full circle to me pointing out again that this is NOT the meaning in which mainstream economics uses the word “rent”.
You do want to popularize your theory, right? That means explaining things using terminology that your target audience knows and understands. Unless you have a very good reason, changing the meaning of pretty standard terms leads to much confusion.
Hmm...I’ll have to look into this more. There certainly is a difference between ‘rent’ and ‘economic rent’. I’m really don’t think I’m misusing economic rent.
You can call it profit if you want. In the model, some nodes have a better ability to extract profit than others. Or we can call it ‘make moneyness’.
I mean that some of us are better at generating some kinds value than others. (Division of Labor)
A wine maker who has been in the business for 25 years can make a better bottle of wine than I can. If he wanted to make the same bottle of wine that I can, he could do it more easily.
A competent wine maker is already rewarded for being able to produce a good bottle of wine under normal capitalism—he can sell this bottle for, say, $50 and you can’t do this with your homebrew.
As to you goals, I don’t see why low velocity of money is a problem (yes, I’m familiar with Keynes). It’s a symptom of the sluggishness of the underlying economic activity, not its cause. Having bank deposits or bonds pay negative interest is also a solved problem (see contemporary Europe), and if you want all store-of-value to be subject to negative interest rates you have to outlaw cash and equivalents to start with.
I don’t know what is “good” value. I also don’t know what is “dignity of labour”.
The wine buyer is not rewarded for buying from a wine maker that will make a better wine bottle tomorrow though. Think for a bit on if she was.
I’m not sure if the velocity of money is a result or a cause of economic activity, but my reason tells me that if it is flowing faster, ‘I’ have a better chance at having some flow to me. P(making 100k at mv 6) < P(making 100k at mv 12)
Can you name a form of non artificial capital that is a cash equivalent? Maybe gold? Any non elements that aren’t subject to entropy? Ultimately, yes, I think all artificial forms of ‘store of value’ should have an artificial form of entropy added to them because that is the way the world works.
I bet if you don’t know what good value is that you at least know bad value when you see it.
...as for the robots. I’m a little serious. If agi emerges into a world where economic nodes are dependent upon each other and it has more to gain from cooperation than dominating, it might buy us a few years to find a balance.
If she were rewarded for buying from someone who’d get better tomorrow, she will also get punished for buying from someone who’d get worse. In other words, you are asking the buyer to assume some risk associated with the future prospects of the seller. I don’t see why this is a good thing, given that the ability of the buyers to influence these prospects is very limited.
As a buyer I don’t want to have a little bit of risky investment forced into every purchase I make.
my reason tells me that if it is flowing faster, ‘I’ have a better chance at having some flow to me.
Err.. would you mind unrolling this reasoning? This sounds to me like a claim that if the lottery revenues are increasing you stand a better chance of getting a winning ticket.
a form of non artificial capital that is a cash equivalent?
What’s “non-artificial capital”? Money itself is “artificial” to start with, the current fiat currencies for certain.
“Cash” is, generally speaking, some store-of-value with the following characteristics: constant nominal value, bearer form, fully liquid.
You can think of inflation as “entropy” for cash.
I bet if you don’t know what good value is that you at least know bad value when you see it.
Not in your sense, I don’t. I think a $1 t-shirt from a sweatshop in Vietnam is good value, for example.
If agi emerges into a world where economic nodes are dependent upon each other and it has more to gain from cooperation than dominating
Why? In the locally standard expectations a UFAI will have zero interest in human economics and the particulars of their arrangement. All it wants is atoms and energy.
If she were rewarded for buying from someone who’d get better tomorrow, she will also get punished for buying from someone who’d get worse. In other words, you are asking the buyer to assume some risk associated with the future prospects of the seller. I don’t see why this is a good thing, given that the ability of the buyers to influence these prospects is very limited.
Some risk, yes. But in the models I’ve run, the risk is fairly small and is mitigated by the fact that shitty wine maker spends some of your cash with awesome barrel maker and awesome seed provider. The recursiveness of the system time shifts out some of your risk.
If shitty wine maker goes out of business, because we have a public ledger we can ‘fold the blockchain’ and connect where the money went to where the money came from and fill in a void that, in the current economy, causes all kinds of volatility.
As a buyer I don’t want to have a little bit of risky investment forced into every purchase I make.
I think you do, you just don’t know it yet :) Your choice would be between more than what you get now or way more than you get now. If I told you that your risk was between getting back 3% or 300% of what you spent over the next 50 years, even in the worst case you’ve gained 3%. You could of course choose to keep using your old money.
Err.. would you mind unrolling this reasoning? This sounds to me like a claim that if the lottery revenues are increasing you stand a better chance of getting a winning ticket.
If you buy a lottery ticket that is good for all future drawings, and they double the number of drawings, you do have a better chance of winning. Your economic potential isn’t a lottery ticket that expires. If people have more to gain by holding their cash than spending/investing it, the chance that they will invest/spend with you goes down. If they there is a cost for holding cash they will seek ways to at least break even. Maybe you break even today, but with your experience, you turn a profit tomorrow.
What’s “non-artificial capital”? Money itself is “artificial” to start with, the current fiat currencies for certain.
A bulldozer is natural capital(non-artificial). A tree is natural. You are natural. A computer is natural. All those things are subject to entropy and have a natural carrying cost. Items whose value derive from law, psychology, math, or ideas are artificial. Money is artificial, but if you don’t make the map the territory something is going to go wonky and you’re going to have a ‘correction’.
“Cash” is, generally speaking, some store-of-value with the following characteristics: constant nominal value, bearer form, fully liquid.
And I’d contend that the store of value part is convenient, but ultimately misguided. It was a shortcut we needed to use to get from horse drawn carriages to databases. But we don’t need to completely preserve the ‘store of value’ anymore. We can let it decay just like the world around it.
You can think of inflation as “entropy” for cash.
Yes, but I’ll contend that controlled inflation(demurrage) is better than the random inflation we deal with now.
Not in your sense, I don’t. I think a $1 t-shirt from a sweatshop in Vietnam is good value, for example.
As good a value as a $1 shirt made by a robot down the block? No fossil fuels burned in shipping, no slave labor. Surely there are better and worse ways of doing things.
Why? In the locally standard expectations a UFAI will have zero interest in human economics and the particulars of their arrangement. All it wants is atoms and energy.
I don’t contend it will solve the problem, just that it might buy us some time if it can get some decent utility out of humans providing the atoms and energy while it ramps up to do it itself. Maybe it is just second. It is just a theory.
Would an intelligence not subject to the availability bias ever choose to not use a form of exchange where it benefited from all uses of the exchanged material in the future vs. exchanging resources for only the perceived present value? I think it is a question worth asking.
As an aside: the local prefix for quoting is “>” at the start of the line, not the pipe character.
I think you do, you just don’t know it yet :) Your choice would be between more than what you get now or way more than you get now.
I think you’re mistaken about my preferences.
You point out yourself that money is (in this context) is just a measure, an medium of exchange. It is NOT the same thing as the underlying value. Now, to “get more” I would want to get more value and you’re promising me just more money. The point is that an economy produces some amount of value and that’s all you have to redistribute. You can make money spin faster, but that will not increase the value produced—all you’ll do is increase inflation.
Essentially, if I buy a loaf of bread from a baker and the baker knows he’ll have to pay me “dividends” in the future, the baker will raise the price of bread to compensate for these future dividends. Your hopes remind me of “free energy” mechanisms in physics—if only we could set up sufficiently clever loops we can get more energy that we put in! Um...
My current understanding of your idea is that you basically want a tax on wealth (or, specifically, on money wealth) with a very complicated scheme to distribute its proceeds directly to the population bypassing the government. Is that a reasonable approach?
I would also like to point out that I think your fears of wealth accumulation are overblown. Look at empirical data. Is there, in reality, old old money dominating everything? Does the Medici family rule Europe? What happened to the Vanderbilts? The oldest rich family I can recall offhand is the Rothschilds and while they are not poor by any means, how do they do compared to Gates or Brin or Musk?
All those things are subject to entropy and have a natural carrying cost.
What about the traditionally most valuable kind of capital—land, also known as real estate? What about technology? or non-agricultural commodities like oil, coal, copper, etc?
controlled inflation(demurrage) is better than the random inflation we deal with now.
The current inflation is controlled to best of central banks’ abilities. You are not controlling it any better, you’re just setting a floor as to how low can it go.
As good a value as a $1 shirt made by a robot down the block?
I’ll take the standard capitalist approach—if the robot down the block can sell me the same shirt cheaper, I’ll buy it from the robot. If it can’t, I’ll buy it from the Vietnamese. I am not willing to pay extra for feel-good fluff.
You point out yourself that money is (in this context) is just a measure, an medium of exchange. It is NOT the same thing as the underlying value. Now, to “get more” I would want to get more value and you’re promising me just more money. The point is that an economy produces some amount of value and that’s all you have to redistribute. You can make money spin faster, but that will not increase the value produced—all you’ll do is increase inflation.
Do you think that the current economy is ginning at an optimal output? How much slack would you guess there is? How much GDP is currently left ‘on the shelf’? Maybe you think we are very close to optimal. If that is the case then I’m tilting at windmills. If it is suboptimal, the the next questions is ‘why?’ Is it a lack of tech. A lack of resources? A lack of time? I’m not sure but I think it is very sub optimal.
If increasing the flow of money would not bridge the missing value, what would? I think that a lot of actors in our economy get stuck ‘waiting for the check’ to get started on production, finish production,procure the capital necessary to build, etc.
Is there some data/study you can point to that says that faster velocity doesn’t increase production? Maybe I should run the model with mv > 1 transaction a month and see what happens.
Essentially, if I buy a loaf of bread from a baker and the baker knows he’ll have to pay me “dividends” in the future, the baker will raise the price of bread to compensate for these future dividends. Your hopes remind me of “free energy” mechanisms in physics—if only we could set up sufficiently clever loops we can get more energy that we put in! Um...
The difference is that there isn’t a law of conservation of value. We regularly see massive exponential movements in the ability of human beings to produce amazing things. Would you argue that we should go back to barter because money is just a clever way of abstracting away coincidence of wants? Energy is physics. Money is an artificial construct.
Also don’t ignore the fact that a consumer may be willing to pay the increased price charged because the consumer will be getting that value back in the future. I understand that this may seem like a clever loop, except that people die. So the loop breaks down and you have to have a system for legacy. The system has a consequence of corporate death as well so you don’t end up with supercorps sucking in all the economic decay. Legacy and transition are in the details of the book, but basically, this isn’t a system that jives with immortality...it is a system to get us there.
My current understanding of your idea is that you basically want a tax on wealth (or, specifically, on money wealth) with a very complicated scheme to distribute its proceeds directly to the population bypassing the government. Is that a reasonable approach?
It isn’t really much more complicated than the fractional reserve system we have now. I have no delusions about the ease of bootstrapping such a system, but it really can be a fairly straight forward and simple system.
I would also like to point out that I think your fears of wealth accumulation are overblown. Look at empirical data. Is there, in reality, old old money dominating everything? Does the Medici family rule Europe? What happened to the Vanderbilts? The oldest rich family I can recall offhand is the Rothschilds and while they are not poor by any means, how do they do compared to Gates or Brin or Musk?
What about the traditionally most valuable kind of capital—land, also known as real estate? What about technology? or non-agricultural commodities like oil, coal, copper, etc?
Certainly somethings have more or less carrying costs. The closer you get to stable elements, the more you can decrease these (Gold, Silver). Carbon is an element but tends to be a slippery beast that takes all kind of crazy forms that break down or change in some way. Land does have a carrying cost of some form of maintenance and most has an artificial carrying cost in the form of property taxes. Gesell had some pretty crazy ideas about land that I don’t exactly buy into. I don’t have many super strong ideas about it because I think(hope) we are going to be moving past the point where land is that big of a deal for most of us.
The current inflation is controlled to best of central banks’ abilities. You are not controlling it any better, you’re just setting a floor as to how low can it go.
Actually the theory is that we can hold inflation at 0 by printing decaying dollars when we need them and decaying them faster when there is too much. Tech is always going to bring about some deflation, but the general goal is for there always to be enough money to buy all the things that are being produced.
I’ll take the standard capitalist approach—if the robot down the block can sell me the same shirt cheaper, I’ll buy it from the robot. If it can’t, I’ll buy it from the Vietnamese. I am not willing to pay extra for feel-good fluff.
I’m a humanist...I guess you are not...agree to disagree? We can’t do that on a rationality discussion board can we? If you aren’t willing to pay for the feel good fluff, do you at least want it to happen? By what means if so. If not, are you cool with the status quo going forward as long as prices always get smaller?
Do you think that the current economy is ginning at an optimal output?
I don’t know what “optimal output” is. Can the economy produce more? Of course it can. What’s stopping it? Ah, an interesting and complicated question. There are a lot of constraints, both local and global—I would say the biggest is the level of technology—and they are binding in different places. As I mentioned earlier, I do not think that the availability of capital is a major constraint at the moment. In fact, we have a glut of cheap money.
I think that a lot of actors in our economy get stuck ‘waiting for the check’ to get started on production
That’s possible, but why do you think these actors would generate value? It’s entirely possible for them to just waste resources. The fact that they have not been able to secure financing indicates that they do not have a convincing plan of creating value.
s there some data/study you can point to that says that faster velocity doesn’t increase production?
Just get yourself a plot of GDP and a plot of money velocity over time. See how correlated they are and whether you think there is a causal connection.
In any case, velocity is a calculated number—it’s just GDP divided by money supply (and you can use different money supplies—the monetary base, M2, M3, etc. to get a velocity for each of them).
a consumer may be willing to pay the increased price charged because the consumer will be getting that value back in the future
That’s the financial equivalent of lending money to the seller. Why would a consumer be interested in becoming a creditor for all purchases?
I think the empirical data is there for the r > g problem
I think that’s not quite true. Yes, Piketty has written a book. Not everyone agrees with its conclusions.
I think doing something is better than nothing.
Really, you don’t think there is a good chance to royally screw things up if you make radical changes with uncertain consequences?
Actually the theory is that we can hold inflation at 0 by printing decaying dollars when we need them and decaying them faster when there is too much.
So what’s stopping the current central banks from easily controlling inflation now in this way? Japan, for example, have been trying to get out of deflation for many years. It printed a lot of yen. Inflation is still negligible.
agree to disagree?
Sure. As long as your proposals are not mandatory :-)
If you aren’t willing to pay for the feel good fluff, do you at least want it to happen?
Depends on what. For some things I don’t care and for some things I expect voluntary consumer choice to be not an effective method to achieve anything useful.
If not, are you cool with the status quo going forward as long as prices always get smaller?
Status quo as in what we have now? I would prefer things to get better, of course, but I’m not holding my breath :-) I am a social pessimist—I believe people have a vast capacity to fuck things up…
From what I gathered if two sellers would sell the exact same product but another seller could sell it at double the price it would become a favoured node. If they were not interchangeable products you could try to argue that the difference must be between the quality of the products. However if the same product has the same use value the measure is more about better extracting profits. There is the effect that given choice of equal product at cheaper or higher price a consumer ought to go with the lower cost. Competetive effects are supposed to kill off overpriced products but giving a bonus to seller for having a big mark up dulls their teeth.
This is a tough one because most of the readily available literature on competition and market take a specific approach. Specific in the sense of time. Of course at the instant we don’t want people favoring more expensive things...unless there is a damn good reason to. If you add in time though things get very interesting. This system alters the proposition to current market decision + future potential. You wouldn’t pay more just to pay more, but you might buy a Tesla instead of a Honda accord because you think that Tesla had better long term earning potential and you are getting in on the ground floor.
Most of the things we buy aren’t commodities. There is some trade off on features vs cost. This system does tip the scales toward things that may be more expensive, but only if there is a long term advancement that can be leveraged.
In the instance where we actually deal with a commodity, more emphasis will be placed on the long term repetitive production of that commodity. If the commodity can’t be renewed it will be less favored. Thus I’d expect a vector away from depletable goods and toward renewable alternatives.
These assumptions are harder to work into a model.
You could offer the Tesla at a high price or a lower price. If the price is higher individual sells will move the company quicker to ground floor. That is Tesla + 1 stock will probably cost less than Tesla + 10 stock. But what is that prevents from offering the option of Tesla + 0 stock or the minimum amount of stock allowed?
There is also the issue that if you think you can afford Tesla + 5 stock but could not afford Tesla + 0 stock you might end up with Tesla that bombs harder than just taking a unpaybackable loan for Tesla + 0 stock. That is when the future component factors in to everyday products future speculation will impact the price of milk. People might have a bigger resistance to buy into things because it doesn’t need to only work in the moment but it needs to work for the future as well. You can’t look at your accout balance and know how well of you are as you are expecting uncertain returns, returns you might need to stay on the positives.
Thanks for the feedback. I’m not quite sure I understand your concerns. Are you concerned that people will offer different levels of stock to different people? That is not exactly how I imagined things working. $1 spent = 1 unit of stock(point/air line mile/smoods/call them what you will it is a unit of account).
In general I think we should be more forward looking. I don’t see much of a negative in causing people to consider the future implication of their actions. We are limiting anyone’s freedom. You can still buy from the less attractive vendor if you want.
Even if the amount of “stock” is the same constant for everybody there is still a decision how big a portion it should represent. In the extreme the only stocks are from the $1 in 1 stock out principle. But in a way the enterpreneur should also have stock in it. If the enterpreneur reserves 1000 stocks for himself that would be the equivalent of a 100 stock person giving out 10 stocks per $. If the starter doesn’t have any stock he doesn’t own it he just operates it for the customer-owners.
Ahh...I see...The ‘stock’ that consumers get in hypercapitalism isn’t a stock of ownership or voting stock. It is a kind of non-voting prefered stock. Really it is more like an airline mile. It doesn’t affect what dividends are paid or the cap table.
Okay I think I identified more preciusly what is it. I will just call it arbitrarily “shard” to make special note that we are defining (or I am figuring out) and that analogs with other things might not apply.
Shard is a right that has a holder and target (ie it can be spesified as a two place predicate s(a,b)). Having multiple shards of same holder and target can be expressed as having a single relation with a strenght in it (ie that s(a,b,100) a has 100 of shards on b).
During regular intervals (which most simply is annually but can be tought to also happen smoothly constantly) there happens a lazy money redistribution event. First we mark everybodys money as “lazy”. We take a portion of everybodys lazy money that they have and mark “waking percent” of it as unlazy. This money will no longer be touched by the event and where the money woke up will be availble to use after the event. For each person we take whatever lazy money they have left (the remaining “dozing percent”) and distribute it equally among all shards that have that person as their target. If A has 10000 and we use 90% waking percent this result in 1000 lazy money and B has 10 shards on him, C has got 25 and D got 5 then B gets 250, C gets 625 and D 125. This happens “simultaneously” for everyone ie can be done in any order (you have to keep track of money before the round started and received this round). Then we start again by waking up percentage of the money of the lazy money and keep doing this until some cut off point (such as under 1$ moved total in round) where the amount of lazy money is low.
This is the claim and the effect of the shard (once it exists). The interesting thing is that the more shards you hold the more you stand to benefit from the redistribution event. Eveyrthing else is derivative of this effect.
Now the idea is that shards are created when you transfer money to someone. Thus a person can’t have more lazy money than there are shards on him. A person can have way less lazy money. If you can’t go into the negatives the least is 0. However by giving it away you inevitably create shards into your holding. Thus even if your own lazy money would be 0 the lazy money you get from the shards will partly go to those that hold shards on you. And because money can’t be destroyed or created by moving each round the money shuffled around is constant. Thus shards can never be totally worthless (in the sense of giving you right to 0 amount of receiving in the redistribution event). However shards that are more “direct” are worth more. With a waking rate of 90% making a shard to person that won’t have lazy money but will make shards only to totally lazy persons is worth 0.01 in the next distribution event while a direct shard would have been worth 0.1. However being the middle man, receiving 1 money and giving it to a totally non-giving (lazy) man is worth 0.09 money in the next redistribution (if all you do is this kind of thing) while the net effect on your point wealth is 0.
To paralel I will give a different formulation. Define a totally unrelated instrument that I will arbitrarily call “portion”. Portion is also a holder,target,magnitude kind of thing. It also is relevant in a redistribution event. Howeve the rules differ a little. All of the lazy money is shared equally among portions. If the portion is on yourself you mark it as unlazy and get to keep it after the event. Then the lazy money is given to the portion holder. Repeat until lazy money has sufficently vanished.
Now the portion generation mechanism is this. When you transfer money to a party you generate a “prociety percentage” of portions on the recipient to yourself and whatever remains of 100% you generate portions on the receiver to the receiver. That is A giving 200 to B with prociety percentage 10 will net A 20 B portions and B 160 B portions.
Both the shard mechanism and portion mechanism results in the same redistribution of money and shards are as valuable as portions. You just never have shards on yourself, so it can be likened to a notational difference. However the idea is that your shard value represents your skill as a consumer. It sounded somehow as plausible idea but as I explictly write it out it seems that those with highest shard values have the lowest trickle-down effects on the economy. If it would be true then the consumer with no consumption would be the master consumer (if all depend on you but you don’t depend on anyone it makes sense). It would also seem to reward those that get those that didn’t consume to consume.
Can you precisely define what this consumer ‘stock’ is? You seem to think of it as a legally binding claim to a long stream of future payments which make it look like a bond. An airline mile is basically a disguised discount and it’s a one-time thing, you use it and it’s gone. Preferred shares have no legally binding obligation to pay out anything.
this is NOT the meaning in which mainstream economics uses the word “rent”
Wikipedia has an article on “economic rent”, so it probably is an existing term, although I have never heard it before.
Seems like “rent” is an income from a (generally) limited resource, while “economic rent” is an extra income from a resource that (locally, temporarily) acts like a limited resource.
Just like apples are generally not a limited resource, but if you need an apple, and your time is limited, and there is only one shop on your way, and it contains a limited amount of apples… then those apples here and now behave like a limited resource.
Yes, exactly. Most economic theory assumes ‘in the moment’ and a bit of God like reach. In the real world we have to deal with time and space.
For most of us working stiffs, when we go to the store to buy milk we are charged an large amount of economic rent to buy it cold, in a container, near our home. Despite the fact that you really need to drive an hour or more to find a cow. Given infinite time and teleportation, we’d hit the farm and get it for much, much less. You only have to look to digital assets to see how this plays out. This isn’t a bad thing. We want the farmer, the pasteurizer, the delivery man and the grocery store to stay in business, but we also want them to do it better, faster, cheaper next time. General market dynamics cause this to happen a rate. I want it to happen at a faster rate.
The economic rent is in the fact that there wasn’t an apple tree on your the walk to the store.
Economic rent isn’t always bad. Otherwise we’d have an apple tree infestation problem.
And we come full circle to me pointing out again that this is NOT the meaning in which mainstream economics uses the word “rent”.
You do want to popularize your theory, right? That means explaining things using terminology that your target audience knows and understands. Unless you have a very good reason, changing the meaning of pretty standard terms leads to much confusion.
Hmm...I’ll have to look into this more. There certainly is a difference between ‘rent’ and ‘economic rent’. I’m really don’t think I’m misusing economic rent.
You can call it profit if you want. In the model, some nodes have a better ability to extract profit than others. Or we can call it ‘make moneyness’.
“Moneyness” is a term in finance :-)
Do you mean “better extract profit” or do you mean “generate value with higher productivity”?
And my initial question still stands: what is your aim and what problems do you want to solve?
See my answer below:
http://lesswrong.com/r/discussion/lw/m38/publishing_my_initial_model_for_hypercapitalism/ca33
I mean that some of us are better at generating some kinds value than others. (Division of Labor)
A wine maker who has been in the business for 25 years can make a better bottle of wine than I can. If he wanted to make the same bottle of wine that I can, he could do it more easily.
A competent wine maker is already rewarded for being able to produce a good bottle of wine under normal capitalism—he can sell this bottle for, say, $50 and you can’t do this with your homebrew.
As to you goals, I don’t see why low velocity of money is a problem (yes, I’m familiar with Keynes). It’s a symptom of the sluggishness of the underlying economic activity, not its cause. Having bank deposits or bonds pay negative interest is also a solved problem (see contemporary Europe), and if you want all store-of-value to be subject to negative interest rates you have to outlaw cash and equivalents to start with.
I don’t know what is “good” value. I also don’t know what is “dignity of labour”.
And I don’t think you’re serious about robots :-P
The wine buyer is not rewarded for buying from a wine maker that will make a better wine bottle tomorrow though. Think for a bit on if she was.
I’m not sure if the velocity of money is a result or a cause of economic activity, but my reason tells me that if it is flowing faster, ‘I’ have a better chance at having some flow to me. P(making 100k at mv 6) < P(making 100k at mv 12)
Can you name a form of non artificial capital that is a cash equivalent? Maybe gold? Any non elements that aren’t subject to entropy? Ultimately, yes, I think all artificial forms of ‘store of value’ should have an artificial form of entropy added to them because that is the way the world works.
I bet if you don’t know what good value is that you at least know bad value when you see it.
I talk more about the full output of labour in this paper: https://www.dropbox.com/s/k97dzssxc58ux1s/hypercapitalismwpv1.1.pdf?dl=0
...as for the robots. I’m a little serious. If agi emerges into a world where economic nodes are dependent upon each other and it has more to gain from cooperation than dominating, it might buy us a few years to find a balance.
If she were rewarded for buying from someone who’d get better tomorrow, she will also get punished for buying from someone who’d get worse. In other words, you are asking the buyer to assume some risk associated with the future prospects of the seller. I don’t see why this is a good thing, given that the ability of the buyers to influence these prospects is very limited.
As a buyer I don’t want to have a little bit of risky investment forced into every purchase I make.
Err.. would you mind unrolling this reasoning? This sounds to me like a claim that if the lottery revenues are increasing you stand a better chance of getting a winning ticket.
What’s “non-artificial capital”? Money itself is “artificial” to start with, the current fiat currencies for certain.
“Cash” is, generally speaking, some store-of-value with the following characteristics: constant nominal value, bearer form, fully liquid.
You can think of inflation as “entropy” for cash.
Not in your sense, I don’t. I think a $1 t-shirt from a sweatshop in Vietnam is good value, for example.
Why? In the locally standard expectations a UFAI will have zero interest in human economics and the particulars of their arrangement. All it wants is atoms and energy.
Some risk, yes. But in the models I’ve run, the risk is fairly small and is mitigated by the fact that shitty wine maker spends some of your cash with awesome barrel maker and awesome seed provider. The recursiveness of the system time shifts out some of your risk.
If shitty wine maker goes out of business, because we have a public ledger we can ‘fold the blockchain’ and connect where the money went to where the money came from and fill in a void that, in the current economy, causes all kinds of volatility.
I think you do, you just don’t know it yet :) Your choice would be between more than what you get now or way more than you get now. If I told you that your risk was between getting back 3% or 300% of what you spent over the next 50 years, even in the worst case you’ve gained 3%. You could of course choose to keep using your old money.
If you buy a lottery ticket that is good for all future drawings, and they double the number of drawings, you do have a better chance of winning. Your economic potential isn’t a lottery ticket that expires. If people have more to gain by holding their cash than spending/investing it, the chance that they will invest/spend with you goes down. If they there is a cost for holding cash they will seek ways to at least break even. Maybe you break even today, but with your experience, you turn a profit tomorrow.
A bulldozer is natural capital(non-artificial). A tree is natural. You are natural. A computer is natural. All those things are subject to entropy and have a natural carrying cost. Items whose value derive from law, psychology, math, or ideas are artificial. Money is artificial, but if you don’t make the map the territory something is going to go wonky and you’re going to have a ‘correction’.
And I’d contend that the store of value part is convenient, but ultimately misguided. It was a shortcut we needed to use to get from horse drawn carriages to databases. But we don’t need to completely preserve the ‘store of value’ anymore. We can let it decay just like the world around it.
Yes, but I’ll contend that controlled inflation(demurrage) is better than the random inflation we deal with now.
As good a value as a $1 shirt made by a robot down the block? No fossil fuels burned in shipping, no slave labor. Surely there are better and worse ways of doing things.
I don’t contend it will solve the problem, just that it might buy us some time if it can get some decent utility out of humans providing the atoms and energy while it ramps up to do it itself. Maybe it is just second. It is just a theory.
Would an intelligence not subject to the availability bias ever choose to not use a form of exchange where it benefited from all uses of the exchanged material in the future vs. exchanging resources for only the perceived present value? I think it is a question worth asking.
As an aside: the local prefix for quoting is “>” at the start of the line, not the pipe character.
I think you’re mistaken about my preferences.
You point out yourself that money is (in this context) is just a measure, an medium of exchange. It is NOT the same thing as the underlying value. Now, to “get more” I would want to get more value and you’re promising me just more money. The point is that an economy produces some amount of value and that’s all you have to redistribute. You can make money spin faster, but that will not increase the value produced—all you’ll do is increase inflation.
Essentially, if I buy a loaf of bread from a baker and the baker knows he’ll have to pay me “dividends” in the future, the baker will raise the price of bread to compensate for these future dividends. Your hopes remind me of “free energy” mechanisms in physics—if only we could set up sufficiently clever loops we can get more energy that we put in! Um...
My current understanding of your idea is that you basically want a tax on wealth (or, specifically, on money wealth) with a very complicated scheme to distribute its proceeds directly to the population bypassing the government. Is that a reasonable approach?
I would also like to point out that I think your fears of wealth accumulation are overblown. Look at empirical data. Is there, in reality, old old money dominating everything? Does the Medici family rule Europe? What happened to the Vanderbilts? The oldest rich family I can recall offhand is the Rothschilds and while they are not poor by any means, how do they do compared to Gates or Brin or Musk?
What about the traditionally most valuable kind of capital—land, also known as real estate? What about technology? or non-agricultural commodities like oil, coal, copper, etc?
The current inflation is controlled to best of central banks’ abilities. You are not controlling it any better, you’re just setting a floor as to how low can it go.
I’ll take the standard capitalist approach—if the robot down the block can sell me the same shirt cheaper, I’ll buy it from the robot. If it can’t, I’ll buy it from the Vietnamese. I am not willing to pay extra for feel-good fluff.
Do you think that the current economy is ginning at an optimal output? How much slack would you guess there is? How much GDP is currently left ‘on the shelf’? Maybe you think we are very close to optimal. If that is the case then I’m tilting at windmills. If it is suboptimal, the the next questions is ‘why?’ Is it a lack of tech. A lack of resources? A lack of time? I’m not sure but I think it is very sub optimal.
If increasing the flow of money would not bridge the missing value, what would? I think that a lot of actors in our economy get stuck ‘waiting for the check’ to get started on production, finish production,procure the capital necessary to build, etc.
Is there some data/study you can point to that says that faster velocity doesn’t increase production? Maybe I should run the model with mv > 1 transaction a month and see what happens.
The difference is that there isn’t a law of conservation of value. We regularly see massive exponential movements in the ability of human beings to produce amazing things. Would you argue that we should go back to barter because money is just a clever way of abstracting away coincidence of wants? Energy is physics. Money is an artificial construct.
Also don’t ignore the fact that a consumer may be willing to pay the increased price charged because the consumer will be getting that value back in the future. I understand that this may seem like a clever loop, except that people die. So the loop breaks down and you have to have a system for legacy. The system has a consequence of corporate death as well so you don’t end up with supercorps sucking in all the economic decay. Legacy and transition are in the details of the book, but basically, this isn’t a system that jives with immortality...it is a system to get us there.
It isn’t really much more complicated than the fractional reserve system we have now. I have no delusions about the ease of bootstrapping such a system, but it really can be a fairly straight forward and simple system.
I think the empirical data is there for the r > g problem(http://www.amazon.com/Capital-Twenty-First-Century-Thomas-Piketty/dp/067443000X/r). I think most of use here probably fall on the side that assumes technology will keep g > r, but with no promises, I think doing something is better than nothing.
Certainly somethings have more or less carrying costs. The closer you get to stable elements, the more you can decrease these (Gold, Silver). Carbon is an element but tends to be a slippery beast that takes all kind of crazy forms that break down or change in some way. Land does have a carrying cost of some form of maintenance and most has an artificial carrying cost in the form of property taxes. Gesell had some pretty crazy ideas about land that I don’t exactly buy into. I don’t have many super strong ideas about it because I think(hope) we are going to be moving past the point where land is that big of a deal for most of us.
Actually the theory is that we can hold inflation at 0 by printing decaying dollars when we need them and decaying them faster when there is too much. Tech is always going to bring about some deflation, but the general goal is for there always to be enough money to buy all the things that are being produced.
I’m a humanist...I guess you are not...agree to disagree? We can’t do that on a rationality discussion board can we? If you aren’t willing to pay for the feel good fluff, do you at least want it to happen? By what means if so. If not, are you cool with the status quo going forward as long as prices always get smaller?
I don’t know what “optimal output” is. Can the economy produce more? Of course it can. What’s stopping it? Ah, an interesting and complicated question. There are a lot of constraints, both local and global—I would say the biggest is the level of technology—and they are binding in different places. As I mentioned earlier, I do not think that the availability of capital is a major constraint at the moment. In fact, we have a glut of cheap money.
That’s possible, but why do you think these actors would generate value? It’s entirely possible for them to just waste resources. The fact that they have not been able to secure financing indicates that they do not have a convincing plan of creating value.
Just get yourself a plot of GDP and a plot of money velocity over time. See how correlated they are and whether you think there is a causal connection.
In any case, velocity is a calculated number—it’s just GDP divided by money supply (and you can use different money supplies—the monetary base, M2, M3, etc. to get a velocity for each of them).
That’s the financial equivalent of lending money to the seller. Why would a consumer be interested in becoming a creditor for all purchases?
I think that’s not quite true. Yes, Piketty has written a book. Not everyone agrees with its conclusions.
Really, you don’t think there is a good chance to royally screw things up if you make radical changes with uncertain consequences?
So what’s stopping the current central banks from easily controlling inflation now in this way? Japan, for example, have been trying to get out of deflation for many years. It printed a lot of yen. Inflation is still negligible.
Sure. As long as your proposals are not mandatory :-)
Depends on what. For some things I don’t care and for some things I expect voluntary consumer choice to be not an effective method to achieve anything useful.
Status quo as in what we have now? I would prefer things to get better, of course, but I’m not holding my breath :-) I am a social pessimist—I believe people have a vast capacity to fuck things up…
From what I gathered if two sellers would sell the exact same product but another seller could sell it at double the price it would become a favoured node. If they were not interchangeable products you could try to argue that the difference must be between the quality of the products. However if the same product has the same use value the measure is more about better extracting profits. There is the effect that given choice of equal product at cheaper or higher price a consumer ought to go with the lower cost. Competetive effects are supposed to kill off overpriced products but giving a bonus to seller for having a big mark up dulls their teeth.
This is a tough one because most of the readily available literature on competition and market take a specific approach. Specific in the sense of time. Of course at the instant we don’t want people favoring more expensive things...unless there is a damn good reason to. If you add in time though things get very interesting. This system alters the proposition to current market decision + future potential. You wouldn’t pay more just to pay more, but you might buy a Tesla instead of a Honda accord because you think that Tesla had better long term earning potential and you are getting in on the ground floor.
Most of the things we buy aren’t commodities. There is some trade off on features vs cost. This system does tip the scales toward things that may be more expensive, but only if there is a long term advancement that can be leveraged.
In the instance where we actually deal with a commodity, more emphasis will be placed on the long term repetitive production of that commodity. If the commodity can’t be renewed it will be less favored. Thus I’d expect a vector away from depletable goods and toward renewable alternatives.
These assumptions are harder to work into a model.
You could offer the Tesla at a high price or a lower price. If the price is higher individual sells will move the company quicker to ground floor. That is Tesla + 1 stock will probably cost less than Tesla + 10 stock. But what is that prevents from offering the option of Tesla + 0 stock or the minimum amount of stock allowed?
There is also the issue that if you think you can afford Tesla + 5 stock but could not afford Tesla + 0 stock you might end up with Tesla that bombs harder than just taking a unpaybackable loan for Tesla + 0 stock. That is when the future component factors in to everyday products future speculation will impact the price of milk. People might have a bigger resistance to buy into things because it doesn’t need to only work in the moment but it needs to work for the future as well. You can’t look at your accout balance and know how well of you are as you are expecting uncertain returns, returns you might need to stay on the positives.
Thanks for the feedback. I’m not quite sure I understand your concerns. Are you concerned that people will offer different levels of stock to different people? That is not exactly how I imagined things working. $1 spent = 1 unit of stock(point/air line mile/smoods/call them what you will it is a unit of account).
In general I think we should be more forward looking. I don’t see much of a negative in causing people to consider the future implication of their actions. We are limiting anyone’s freedom. You can still buy from the less attractive vendor if you want.
Even if the amount of “stock” is the same constant for everybody there is still a decision how big a portion it should represent. In the extreme the only stocks are from the $1 in 1 stock out principle. But in a way the enterpreneur should also have stock in it. If the enterpreneur reserves 1000 stocks for himself that would be the equivalent of a 100 stock person giving out 10 stocks per $. If the starter doesn’t have any stock he doesn’t own it he just operates it for the customer-owners.
Ahh...I see...The ‘stock’ that consumers get in hypercapitalism isn’t a stock of ownership or voting stock. It is a kind of non-voting prefered stock. Really it is more like an airline mile. It doesn’t affect what dividends are paid or the cap table.
Okay I think I identified more preciusly what is it. I will just call it arbitrarily “shard” to make special note that we are defining (or I am figuring out) and that analogs with other things might not apply.
Shard is a right that has a holder and target (ie it can be spesified as a two place predicate s(a,b)). Having multiple shards of same holder and target can be expressed as having a single relation with a strenght in it (ie that s(a,b,100) a has 100 of shards on b).
During regular intervals (which most simply is annually but can be tought to also happen smoothly constantly) there happens a lazy money redistribution event. First we mark everybodys money as “lazy”. We take a portion of everybodys lazy money that they have and mark “waking percent” of it as unlazy. This money will no longer be touched by the event and where the money woke up will be availble to use after the event. For each person we take whatever lazy money they have left (the remaining “dozing percent”) and distribute it equally among all shards that have that person as their target. If A has 10000 and we use 90% waking percent this result in 1000 lazy money and B has 10 shards on him, C has got 25 and D got 5 then B gets 250, C gets 625 and D 125. This happens “simultaneously” for everyone ie can be done in any order (you have to keep track of money before the round started and received this round). Then we start again by waking up percentage of the money of the lazy money and keep doing this until some cut off point (such as under 1$ moved total in round) where the amount of lazy money is low.
This is the claim and the effect of the shard (once it exists). The interesting thing is that the more shards you hold the more you stand to benefit from the redistribution event. Eveyrthing else is derivative of this effect.
Now the idea is that shards are created when you transfer money to someone. Thus a person can’t have more lazy money than there are shards on him. A person can have way less lazy money. If you can’t go into the negatives the least is 0. However by giving it away you inevitably create shards into your holding. Thus even if your own lazy money would be 0 the lazy money you get from the shards will partly go to those that hold shards on you. And because money can’t be destroyed or created by moving each round the money shuffled around is constant. Thus shards can never be totally worthless (in the sense of giving you right to 0 amount of receiving in the redistribution event). However shards that are more “direct” are worth more. With a waking rate of 90% making a shard to person that won’t have lazy money but will make shards only to totally lazy persons is worth 0.01 in the next distribution event while a direct shard would have been worth 0.1. However being the middle man, receiving 1 money and giving it to a totally non-giving (lazy) man is worth 0.09 money in the next redistribution (if all you do is this kind of thing) while the net effect on your point wealth is 0.
To paralel I will give a different formulation. Define a totally unrelated instrument that I will arbitrarily call “portion”. Portion is also a holder,target,magnitude kind of thing. It also is relevant in a redistribution event. Howeve the rules differ a little. All of the lazy money is shared equally among portions. If the portion is on yourself you mark it as unlazy and get to keep it after the event. Then the lazy money is given to the portion holder. Repeat until lazy money has sufficently vanished.
Now the portion generation mechanism is this. When you transfer money to a party you generate a “prociety percentage” of portions on the recipient to yourself and whatever remains of 100% you generate portions on the receiver to the receiver. That is A giving 200 to B with prociety percentage 10 will net A 20 B portions and B 160 B portions.
Both the shard mechanism and portion mechanism results in the same redistribution of money and shards are as valuable as portions. You just never have shards on yourself, so it can be likened to a notational difference. However the idea is that your shard value represents your skill as a consumer. It sounded somehow as plausible idea but as I explictly write it out it seems that those with highest shard values have the lowest trickle-down effects on the economy. If it would be true then the consumer with no consumption would be the master consumer (if all depend on you but you don’t depend on anyone it makes sense). It would also seem to reward those that get those that didn’t consume to consume.
Can you precisely define what this consumer ‘stock’ is? You seem to think of it as a legally binding claim to a long stream of future payments which make it look like a bond. An airline mile is basically a disguised discount and it’s a one-time thing, you use it and it’s gone. Preferred shares have no legally binding obligation to pay out anything.
Wikipedia has an article on “economic rent”, so it probably is an existing term, although I have never heard it before.
Seems like “rent” is an income from a (generally) limited resource, while “economic rent” is an extra income from a resource that (locally, temporarily) acts like a limited resource.
Just like apples are generally not a limited resource, but if you need an apple, and your time is limited, and there is only one shop on your way, and it contains a limited amount of apples… then those apples here and now behave like a limited resource.
Yes, exactly. Most economic theory assumes ‘in the moment’ and a bit of God like reach. In the real world we have to deal with time and space.
For most of us working stiffs, when we go to the store to buy milk we are charged an large amount of economic rent to buy it cold, in a container, near our home. Despite the fact that you really need to drive an hour or more to find a cow. Given infinite time and teleportation, we’d hit the farm and get it for much, much less. You only have to look to digital assets to see how this plays out. This isn’t a bad thing. We want the farmer, the pasteurizer, the delivery man and the grocery store to stay in business, but we also want them to do it better, faster, cheaper next time. General market dynamics cause this to happen a rate. I want it to happen at a faster rate.