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Current trends are inherently unstable. You can't have a workable political system when nearly all the economic gains accrue to a small group at the top. I don

Current trends are inherently unstable. You can't have a workable political system when nearly all the economic gains accrue to a small group at the top. I don't think that's necessarily true (unfortunately). There's probably a threshold where inequality becomes unsustainable, but it could be very high. See Axelrod's The Evolution of Cooperation. It's most famous for the iterated Prisoner's Dilemma contest, where the simple "tit for tat" strategy beat all the others, but there's a lot more great material in there. "Tit for tat" is just one stable solution, but there are others. Another stable solution is an unpleasant-sounding caste system, where everybody is nice to people of higher rank and nasty to people of lower rank. That system is self-sustaining and resistant to interlopers as long as it's self-policing, i.e. the insiders punish people who buck the system. Even people at the bottom of the pecking order are incentivized to play along and keep their heads down. Similarly, I think extreme inequality could be stable and self-sustaining. I think it would require people to actively reject "government handouts", which is exactly what we see in a lot of political rhetoric these days. Almost all large corporations have extreme salary inequality, but they're still relatively stable and successful entities. Why wouldn't the low-level workers demand more pay? Because it's a "meritocracy" -- we need high executive salaries to attract the best people, and if you just work a bit harder maybe you'll get promotion and earn the big bucks for yourself.

CPLX 10y ago
> Another stable solution is an unpleasant-sounding caste system, where everybody is nice to people of higher rank and nasty to people of lower rank. Yes, to some extent. I suppose there is an argument you can make that there's another Nash equilibrium at the point of extreme inequality, where a couple people are rich and everyone else is essentially starving. But that sort of seems besides the point, given how complex and interconnected our current economic and political structures are. > Almost all large corporations have extreme salary inequality, but they're still relatively stable and successful entities. On what time scale? I would argue that if governments were even 1/10 as likely to fail as large corporations the world would be quickly reduced to rubble.
- iainmerrick 10y ago
  I suppose there is an argument you can make that there's another Nash equilibrium at the point of extreme inequality, where a couple people are rich and everyone else is essentially starving. I meant more an equilibrium where there's a pyramid and everyone knows their place. (Maybe the lowest class needs to be small rather than large, I'm not sure.) But that sort of seems besides the point, given how complex and interconnected our current economic and political structures are. I don't understand this, can you elaborate? On what time scale? I would argue that if governments were even 1/10 as likely to fail as large corporations the world would be quickly reduced to rubble. You're right, corporations are definitely shorter-lived on average (although there are some very long-lived ones). I guess there are some important differences between companies and countries, notably that countries are tied to a particular land area and population. And they're far less numerous than companies. I still think my point is relevant and worth exploring, though. If democracy (or any other system) is so great, why don't companies tend to use it? Even companies that are worker-owned tend to be run in fairly traditional ways (see e.g. John Lewis in the UK).

CPLX 10y ago

> Another stable solution is an unpleasant-sounding caste system, where everybody is nice to people of higher rank and nasty to people of lower rank. Yes, to some extent. I suppose there is an argument you can make that there's another Nash equilibrium at the point of extreme inequality, where a couple people are rich and everyone else is essentially starving. But that sort of seems besides the point, given how complex and interconnected our current economic and political structures are. > Almost all large corporations have extreme salary inequality, but they're still relatively stable and successful entities. On what time scale? I would argue that if governments were even 1/10 as likely to fail as large corporations the world would be quickly reduced to rubble.

iainmerrick 10y ago
I suppose there is an argument you can make that there's another Nash equilibrium at the point of extreme inequality, where a couple people are rich and everyone else is essentially starving. I meant more an equilibrium where there's a pyramid and everyone knows their place. (Maybe the lowest class needs to be small rather than large, I'm not sure.) But that sort of seems besides the point, given how complex and interconnected our current economic and political structures are. I don't understand this, can you elaborate? On what time scale? I would argue that if governments were even 1/10 as likely to fail as large corporations the world would be quickly reduced to rubble. You're right, corporations are definitely shorter-lived on average (although there are some very long-lived ones). I guess there are some important differences between companies and countries, notably that countries are tied to a particular land area and population. And they're far less numerous than companies. I still think my point is relevant and worth exploring, though. If democracy (or any other system) is so great, why don't companies tend to use it? Even companies that are worker-owned tend to be run in fairly traditional ways (see e.g. John Lewis in the UK).