![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
Part 1
Part 2
What were the responsibilities of a medieval serf, and did they result in an efficient use of land? Could the EU or African Union provide a blueprint for a federation of planets? Romie Stott will offer an overview of economic systems past, present, and theoretical, touching on gold standards, mercantilism, oligopolies, usury laws, non-Soviet communism, competitive advantage, and how tax policy can motivate altruistic behavior or create a black market. If you've ever wondered why diamonds cost more than water and whether that would change with replicators, this is the place for you.
This was my solo talk, and the reason I was invited to Readercon. I wish I'd had more than an hour (which was really 50 minutes); I covered ground as fast as I could. It would take pages and pages to summarize what I said; the outline alone (which I've posted below) ran to 4 pages.
I could summarize the entire talk like so:
Currency is an emergent property of sufficiently complex human society, and if your techno-utopian future does not include currency, you have predicted wrong. (Hard SF analogy: It is possible to write about a non-spherical planet. Are we going to find one that is naturally occurring or that will last long? No.) When there is a stable society but not a reliable currency (for instance a cooperative culture but not a stable government), you get variations of feudalism, which protects what exists but is a kind of stasis.
Once you get a stable currency again (or for the first time), technological advances and free movement of labor become possible, and society moves out of feudalism to a market economy. There is no future next step past market economy, only varying levels of market freedom and market efficiency. There are distortions and levers you can play with (with various real-world examples), but obliterating money just gets you neo-feudalism (even if you call it something clever like a "gift economy" or "prestige economy" or "communism"). Even with replicators and eternal life, there is such a thing as opportunity cost. However, there are situations in which money does not matter or is not useful, including subcultures within the dominant culture (such as families and inter-office relationships).
Of course, it's the specific examples that are interesting and give you story hooks - hence my my four-page outline below.
I didn't say this specifically in the talk, but these are the two popular misconceptions I'd like to clear up about economics as a field.
1. Economics as technology
Economics is a science - essentially a sub-field of anthropology which focuses on public transactions (sales of land, labor relations, voting systems, etc.) In other words, economics is an attempt to explain what is already happening. It can be predictive, in the same way geologists can warn you an earthquake is coming or oil is more likely to be found in one area than another area. Along these lines, when we talk about economic advances, we're not talking about inventing anything, any more than advances in astronomy invent new stars; we're talking about getting better at seeing and explaining what was there in the first place.
What I'm getting at is, economics is not a technology - it's not something that lets us do more things than we could do without economics, and we're not going to invent a "new" economics that will replace our "outdated" current economy. As a science, economics simply describes. It's not really about should, not in a moral sense. It tells you what people in your area are paying factory workers, and why, not what you ought to pay factory workers, or even whether you care about making money beyond what it takes to keep the doors open.
2. Economics as applied to individual behavior
As such, economics is about groups and averages, not individuals. There are ways you can apply economic thinking to your life - you might, for instance, decide it's worth spending an extra $100 to fly home a day early because you'd save that much on the cost of a hotel and eating out. You might conversely decide it's worth an extra $100 to fly home a day later, because being away from home that extra day relaxes you as much as spending $200 for a therapy session. But these are also decisions you could make without thinking of them in economic terms, just by thinking "hey, what do I really want."
Don't get me wrong: economics is hardly useless. If you want to know whether raising DUI penalties or closing bars earlier is going to cut down on drunk driving, or how much money you're going to make if you install toll booths on a bridge (which is going to make a certain number of people stop using the bridge), you do an economic analysis. But economics is not going to tell you that your neighbor is going to be one of those individuals who is really annoyed about the toll bridge and will want to talk to you about it every day, and will successfully run against you in the next election by promising to cut property taxes since now we're paying for things with the toll bridge. Economics can tell you that a bank could succeed at a given location, not whether your bank will succeed.
In other words, economics does not tell you how to win at money or solve the world's problems. It tells you: given these preconditions, if you change these things, these other things will (or won't) shift in this direction by about this much. And if you don't change things at all, the future will tend to look like this. When it comes to the future, at least at present, economists won't be able to give you a clear timescale. Pretty much every economist knew for 10 years that the housing market was a bubble and a collapse was imminent, but in the meantime a lot of people made a lot of money out of the rise in prices. Ballpark, I'd say we've gotten good at guessing big things within about 5 years of when they happen. If we try to get too precise or too broad or too far out, we run into the same kinds of problems as meteorologists.
Economists themselves are to blame for largely to blame for these misconceptions. We like to make ourselves sound like cool all-powerful rock stars who can hack the planet and give you the keys to an easy life and simple tricks to cut down on belly fat. What we do is cool and can cut down on human misery in a wide range of areas. Or it can be used as an excuse to act totally horrible to other people. Like just about anything.
On to the outline. Which obviously simplifies quite a bit for expediency, as did the talk.
( Read more... )
Part 2
What were the responsibilities of a medieval serf, and did they result in an efficient use of land? Could the EU or African Union provide a blueprint for a federation of planets? Romie Stott will offer an overview of economic systems past, present, and theoretical, touching on gold standards, mercantilism, oligopolies, usury laws, non-Soviet communism, competitive advantage, and how tax policy can motivate altruistic behavior or create a black market. If you've ever wondered why diamonds cost more than water and whether that would change with replicators, this is the place for you.
This was my solo talk, and the reason I was invited to Readercon. I wish I'd had more than an hour (which was really 50 minutes); I covered ground as fast as I could. It would take pages and pages to summarize what I said; the outline alone (which I've posted below) ran to 4 pages.
I could summarize the entire talk like so:
Currency is an emergent property of sufficiently complex human society, and if your techno-utopian future does not include currency, you have predicted wrong. (Hard SF analogy: It is possible to write about a non-spherical planet. Are we going to find one that is naturally occurring or that will last long? No.) When there is a stable society but not a reliable currency (for instance a cooperative culture but not a stable government), you get variations of feudalism, which protects what exists but is a kind of stasis.
Once you get a stable currency again (or for the first time), technological advances and free movement of labor become possible, and society moves out of feudalism to a market economy. There is no future next step past market economy, only varying levels of market freedom and market efficiency. There are distortions and levers you can play with (with various real-world examples), but obliterating money just gets you neo-feudalism (even if you call it something clever like a "gift economy" or "prestige economy" or "communism"). Even with replicators and eternal life, there is such a thing as opportunity cost. However, there are situations in which money does not matter or is not useful, including subcultures within the dominant culture (such as families and inter-office relationships).
Of course, it's the specific examples that are interesting and give you story hooks - hence my my four-page outline below.
I didn't say this specifically in the talk, but these are the two popular misconceptions I'd like to clear up about economics as a field.
1. Economics as technology
Economics is a science - essentially a sub-field of anthropology which focuses on public transactions (sales of land, labor relations, voting systems, etc.) In other words, economics is an attempt to explain what is already happening. It can be predictive, in the same way geologists can warn you an earthquake is coming or oil is more likely to be found in one area than another area. Along these lines, when we talk about economic advances, we're not talking about inventing anything, any more than advances in astronomy invent new stars; we're talking about getting better at seeing and explaining what was there in the first place.
What I'm getting at is, economics is not a technology - it's not something that lets us do more things than we could do without economics, and we're not going to invent a "new" economics that will replace our "outdated" current economy. As a science, economics simply describes. It's not really about should, not in a moral sense. It tells you what people in your area are paying factory workers, and why, not what you ought to pay factory workers, or even whether you care about making money beyond what it takes to keep the doors open.
2. Economics as applied to individual behavior
As such, economics is about groups and averages, not individuals. There are ways you can apply economic thinking to your life - you might, for instance, decide it's worth spending an extra $100 to fly home a day early because you'd save that much on the cost of a hotel and eating out. You might conversely decide it's worth an extra $100 to fly home a day later, because being away from home that extra day relaxes you as much as spending $200 for a therapy session. But these are also decisions you could make without thinking of them in economic terms, just by thinking "hey, what do I really want."
Don't get me wrong: economics is hardly useless. If you want to know whether raising DUI penalties or closing bars earlier is going to cut down on drunk driving, or how much money you're going to make if you install toll booths on a bridge (which is going to make a certain number of people stop using the bridge), you do an economic analysis. But economics is not going to tell you that your neighbor is going to be one of those individuals who is really annoyed about the toll bridge and will want to talk to you about it every day, and will successfully run against you in the next election by promising to cut property taxes since now we're paying for things with the toll bridge. Economics can tell you that a bank could succeed at a given location, not whether your bank will succeed.
In other words, economics does not tell you how to win at money or solve the world's problems. It tells you: given these preconditions, if you change these things, these other things will (or won't) shift in this direction by about this much. And if you don't change things at all, the future will tend to look like this. When it comes to the future, at least at present, economists won't be able to give you a clear timescale. Pretty much every economist knew for 10 years that the housing market was a bubble and a collapse was imminent, but in the meantime a lot of people made a lot of money out of the rise in prices. Ballpark, I'd say we've gotten good at guessing big things within about 5 years of when they happen. If we try to get too precise or too broad or too far out, we run into the same kinds of problems as meteorologists.
Economists themselves are to blame for largely to blame for these misconceptions. We like to make ourselves sound like cool all-powerful rock stars who can hack the planet and give you the keys to an easy life and simple tricks to cut down on belly fat. What we do is cool and can cut down on human misery in a wide range of areas. Or it can be used as an excuse to act totally horrible to other people. Like just about anything.
On to the outline. Which obviously simplifies quite a bit for expediency, as did the talk.
( Read more... )
