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> His point was that even if energy itself is cheap there’s a floor to how it is valued relative to the total economy for such a vital commodity. I don't think

> His point was that even if energy itself is cheap there’s a floor to how it is valued relative to the total economy for such a vital commodity. I don't think that's true though. There are vital commodities that have been effectively free in some societies (water and salt, for example). Even energy - wind energy is free and some societies used it extensively, and biomass for burning was abundant in some places. We can argue whether or not it's likely that energy would get to be so cheap in the future, but there doesn't seem to be much basis for his claim that it's economically impossible.

neltnerb 7y ago
But if the entire earth's surface were covered in windmills to supply enough power for the economy at that point in growth, suddenly the energy has to have a floor price. I think the easier arguments are that transformational technologies like 1000x improvements can dramatically extend growth, even if they don't stop it, and that transformational energy technologies that don't rely on the sun would frankly imply starflight. So the timelines might be off by factors of ten, and in such timelines these things don't feel so necessarily absurd. If you're seriously at the technological stage where you can put computers with 1000x more power than ours running AI and using 1000x as energy dense of technology, expanding beyond the solar system seems pretty approximately the right place to be going. Just unlikely. And finite. Even a very long time is finite. Perhaps this is where the economist and physicist differ most.
ben_w 7y ago
Those examples are cheap because you can arbitrarily produce more than you need. As counterexample, consider things which you cannot arbitrarily produce more of — licensed drugs, lottery ticket combinations, shares of a company you’re not already running. In all cases, it is possible to buy enough that you’re excluding other people from buying any. In the case of licensed drugs and similar, this is why monopolies are regulated. In the case of lottery tickets, it’s one of the few “winning” strategies and (Some? All?) places forbid it. In this narrative, energy production is limited at some imprecisely defined level, so more cannot be produced.
paraschopra 7y ago
Water is cheap/free because it's a physiological requirement for living, and not because it's abundant or is not a bottleneck. Price is not universal indicator of value, neither being cheap implies that you can't run out of it. Many Indian cities are quickly running out of fresh ground water. The worst thing a city could do is let market determine the price so rich could use it more. Rationing at a less price is the way municipalities are going, which is more ethical way of doing things. The same could happen for energy or other resources, while they still being cheap.

neltnerb 7y ago

But if the entire earth's surface were covered in windmills to supply enough power for the economy at that point in growth, suddenly the energy has to have a floor price. I think the easier arguments are that transformational technologies like 1000x improvements can dramatically extend growth, even if they don't stop it, and that transformational energy technologies that don't rely on the sun would frankly imply starflight. So the timelines might be off by factors of ten, and in such timelines these things don't feel so necessarily absurd. If you're seriously at the technological stage where you can put computers with 1000x more power than ours running AI and using 1000x as energy dense of technology, expanding beyond the solar system seems pretty approximately the right place to be going. Just unlikely. And finite. Even a very long time is finite. Perhaps this is where the economist and physicist differ most.

ben_w 7y ago

Those examples are cheap because you can arbitrarily produce more than you need. As counterexample, consider things which you cannot arbitrarily produce more of — licensed drugs, lottery ticket combinations, shares of a company you’re not already running. In all cases, it is possible to buy enough that you’re excluding other people from buying any. In the case of licensed drugs and similar, this is why monopolies are regulated. In the case of lottery tickets, it’s one of the few “winning” strategies and (Some? All?) places forbid it. In this narrative, energy production is limited at some imprecisely defined level, so more cannot be produced.

paraschopra 7y ago

Water is cheap/free because it's a physiological requirement for living, and not because it's abundant or is not a bottleneck. Price is not universal indicator of value, neither being cheap implies that you can't run out of it. Many Indian cities are quickly running out of fresh ground water. The worst thing a city could do is let market determine the price so rich could use it more. Rationing at a less price is the way municipalities are going, which is more ethical way of doing things. The same could happen for energy or other resources, while they still being cheap.