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ESR on Scottish SF

Bill HumphriesPerson was signed in when posted
09:45 PM ET (US)
Just one correction. Lawrence did not recommend the panelists. The original cast was assembled at a ConJose planning meeting. However, several of them were unable to attend, and that let to the configuration of the now (notorious/legendary) panel.
Edited 12-15-2002 09:45 PM
Deepak Subburam
09:05 PM ET (US)
Re: /m2 would scarcity ever disappear?

In the near future, property will be scarce (there's only so much inhabitable area). And a friend mentioned another scarcity that will be harder to get around: attention (i.e. fame). It is not obvious to me that there will come a time when nothing is scarce, even in a post-singularity society. It is interesting to think about though!
David Bell
02:25 AM ET (US)
I ought to be ashamed of bringing up healthcare as an example, but when ESR talks about fetishizing socialism I am reminded what the market-heavy healthcare system in the US can lead to.

The medications I need to stay alive, with relatively common medical problems, are so numerous that I cannot see any rational insurance-based operation, free to make the choice, being willing to take me on. Remove that freedom, and you take that first step in the direction of a tax-funded, socialist, system. But, unlike insurance, a tax-based system charges people according to what wealth they have, not what health they have.

Is it safe to mention what Marx wrote about ability and needs. It sounds a very Christian principle to me, unlike the rabid dog-ead-dog market-space of extreme libertarians.
Henry Farrell
11:27 AM ET (US)

Economic theory is a lot more ambiguous on the unadulterated benefits of free markets than you imply. While general equilibrium theory suggests that a perfectly competitive market will lead to efficiency, it does so on the basis of highly unrealistic assumptions, as its creator, Ken Arrow happily acknowledges (also see an interesting - and uncomfortable for libertarians - interview with him on the mixed effects of free markets at http://minneapolisfed.org/pubs/region/95-12/int9512.cfm).

I find the "informational benefits of markets" arguments that you tout wishy-washy and unhelpful. They completely fail to explain why competitive markets, supposedly the most efficient form of coordination and information exchange possible, persistently generate internal hierarchies in the form of firms. Why should firms be necessary if free markets and price signals on their own provide all the information that you need to coordinate economic action?

These - and other - fundamental problems, are why the cutting edge of economic theory is the theory of infinitely iterated games, which lends itself to power, culture, and other external factors as explanations of economic phenomena, and does not get hung up on free markets as perfect generators of efficiency. Not to mention the literature on increasing returns, which you must be familiar with from your stuff on open source software.

Final (tedious for non-economists) factual point - you say that Keynesian demand management was discredited b/c people started to game it. Not so - what was discredited was the Phillips curve empirical relationship between inflation and employment - which does not flow from Keynes' general theory of disequilibrium. Current non-Keynesian macroeconomic theories of long lasting unemployment have notoriously problematic basic assumptions - cf, for brief discussion, the Arrow interview urled above.
09:40 AM ET (US)
*Every* political idea is evil when taken to an ultimate conclusion. When you really follow your beliefs consistently to the last implication, than you will reach a point where you are willing to let people die who would've lived otherwise just to stand by your principles. And that, IMO, is wrong.
Gary Farber
02:51 AM ET (US)
"Now, I've got nothing against libertarians in general -- but some of them seem incapable of listening to other folks' viewpoints without filtering them through a kind of ideological anti- virus scanner so they can reject anything that doesn't fit inside their world view."

I've often felt that way about many libertarians. Also socialists. Also monarchists, republicans, democrats, anarchists, Tories, liberals, communists. Etc. In short, much as I agree with you, I think that when you wrote "libertarians," you misspelled "people."
Duncan Lawie
04:32 PM ET (US)
Perhaps I read naively, but I never thought that communism was at the centre of the Culture. The Culture itself always sounded amorphous and distant; the 'black hole at its centre' more of an indication that there was no justification for how the system worked - and no need for one, as it was a great place for telling stories.

As for Ken MacLeod ... he seems to maintain a broad political church all on his own. However, most people seem to have read their own political position into the Fall Revolution, seeing how it is generally lauded by both libertarians and socialists, which makes it interesting that ESR has seen the opposite view most strongly.

<interview> http://www.zone-sf.com/kenmacleod.html </interview>
RJ Johnson
03:21 PM ET (US)
Eric says:
"In general, all economic-planning measures will fail once the actors in the system become aware of the plan. They'll game against the plan rather than gaming to maximize efficiency, and you'll be right back on the road to malinvestment and collapse."

So why not build a plan where gaming against the system is a part of maximizing efficiency?
kennyPerson was signed in when posted
02:28 PM ET (US)
thought you might find this interesting :) apparently a centrally planned economy using linear programming can be functionally equivalent to a market economy, at least theoretically!

Friedrich Hayek refined his position in response to this new argument. He did this in a series of seminal articles (1937, 1940, 1945, 1948, 1968) where he essentially argued that a state-run economy could not achieve greater efficiency in resource allocation than a capitalist one largely because the information conveyed by the price-mechanism of a market economy was greater than the information any planner could possibly acquire. This led on to the work on information and self-organization that dominated the second half of Hayek's career.

Among the more interesting results of this debate was the adoption, in the Soviet Union itself, of the techniques suggested by Lange. This led to the development of linear programming by Leonid Kantorovich which demonstrated that efficient allocation in a planned economy required effectively the same of use of prices as in a competitive market economy. This was also discovered by Tjalling C. Koopmans in his formal discussion of efficiency in a multi-market scenario. In their conclusion, that a collectivist economy could do no better than a private market system in the idealized Walrasian world - but it might also do no worse. In short, they confirmed Barone's original conjecture - at least in theory. The Austrians have held on to Hayek's position on the "informational" role of prices and the incentives problem.

btw, i think a more formal definition of scarcity that's worth revisiting regards excludability, rivalry and transparency in public goods theory. j. bradford delong [1] and a. michael froomkin [2] wrote an excellent paper on the technical conditions for efficient market exchange in relation to informational 'goods' and intellectual 'property' about this.

also, bernard lietaer [3] and keith hart [4] make a great case that money (which is basically an agreement) is itself a scarce resource that could be alleviated by the creation of "agreement" systems, like LETS and HOURs, (other than central bank administered fiat currencies) which i think would be a more sophisticated way of implementing social wages.
Charlie StrossPerson was signed in when posted
09:19 AM ET (US)
And I'm going to repeat myself: economics is the science of distributing resources under conditions of scarcity. (There's a hint there -- scarcity.)

If you abolish scarcity -- howsoever you do it -- one of the constraints has broken and you need to look outside the box for a way of treating it. I'm not convinced that classical economics, or Marxist economics, or any other kind of economic theory we have to day, has a hell of a lot to tell us about a post-singularity society or a post-scarcity society.

In fact, I'd go so far as to say that I figure economics is the last big untapped science waiting to be discovered by science fiction ...
Eric Raymond
06:39 AM ET (US)
<p>Sorry, Charlie, the Calculation Problem still applies to
Banks's Culture. You can't have "demand signals" without a market, and even infinite amounts of computing
power can't get you out of that hole. It's actually provable that even a bureacrat-god with perfect knowledge cannot get the job done -- markets "know" things that
planners cannot. (See David D. Friedman's excellent book "Hidden Order: The Economics of Everyday Life" for discussion).</p>

<p>Furthermore, you can't plan your way out of market failures even at the grossest macroeconomic level. Keynesian demand manipulation stopped working in the 1970s. You know why? It's because the manipulees caught wise -- rational business planning became speculation on the direction of monetary policy rather than a reaction to fundamentals. That's how we got high inflation and high unemployment at the same time.</p>

<p>In general, all economic-planning measures will fail once
the actors in the system become aware of the plan. They'll
game against the plan rather than gaming to maximize efficiency, and you'll be right back on the road to malinvestment and collapse. There is no escape. Nixon's Council on Wage-Price Stability couldn't do it, GOSPLAN
couldn't do it, and the Culture Minds couldn't do it either.</p>

<p>You missed the fact that I didn't miss the fact
that MacLeod's characters are entrepreneurs. That is one of the things that makes them so repellently fascinating, that they know markets work better but fetishize socialism anyway.</p>

<p>There are a bunch of other minor claims I could refute,
but I'd rather stay focused on the big one. You believe
a lot of things about economics that ain't so. Rather
than argue politics with you, I challenge you to go read
Friedman and learn how markets actually work. Then think
about the political implications. You are more than smart enough to get them.</p>

(Sorry about the markup...thought I was supposed to be
typing HTML.)
Edited 05-31-2002 06:39 AM

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