8 ms·

It is zero sum, because no intentional action can increase wealth. Only the gradual, chance-based progression of new money into the game. In contrast, if I tak

It is zero sum, because no intentional action can increase wealth. Only the gradual, chance-based progression of new money into the game. In contrast, if I take out a loan and build a successful business, my intentional actions (successful business) lead to greater money supply than if I had failed at business. Does that make sense, or am I missing something? I'll admit, the creation of new wealth/money is very mysterious. How to know when it is growing the pie?

sokoloff 7y ago
I would argue that if I hold 2 of the yellow and 1 of the green properties and you hold 1 of the yellow and 2 of the green in a 3+ person game, that we do have an intentional action that can leave us both better off.
- dr_dshiv 7y ago
  Is trading legal in Monopoly? I'm assuming that's what you are referring to.
  - jmpman 7y ago
    It is in my house.
  - sokoloff 7y ago
    Yes. It's part of the official rules (and the absence of it would be fairly disastrous to the game dynamics I think).
  - e12e 7y ago
    Apparently not in the original : http://landlordsgame.info/rules/lg-1904p_patent.html http://landlordsgame.info/rules/lg-1904p_patent.html However: > Borrowing: A player may borrow from the “Bank" in amounts of one hundred dollars, and for every one hundred dollars borrowed the " Bank" takes a mortgage on one or more of the borrower's lots, the total value of which must be at least ten dollars more than is borrowed. For every one hundred dollars borrowed from the "Bank" a bank mortgage is placed upon the property on which the loan is made, and the player puts his note in the "Bank," paying upon each note five dollars (interest) every time he receives his wages. One player may borrow from another, giving a mortgage on any property he may own and making the best bargain he can as to interest, terms of payments &c. The player loaning the money places his individual, mortgage on the top of the borrower's deed to show that he has a mortgage on that property, Should a loan be repaid before passing the beginning-point, the borrower saves the interest. But there are a few variations... This one looks closer to "modern" monopoly - I can't seem to locate the "two rulesets" referenced by Wikipedia though (one "pro" one "contra" monopoly - in the second everyone supposedly benefits from created value). http://landlordsgame.info/games/lg-1906/lg-1906_egc-rules.html http://landlordsgame.info/games/lg-1906/lg-1906_egc-rules.ht... https://en.m.wikipedia.org/wiki/Monopoly_(game) https://en.m.wikipedia.org/wiki/Monopoly_(game) > Magie created two sets of rules: an anti-monopolist set in which all were rewarded when wealth was created, and a monopolist set in which the goal was to create monopolies and crush opponents. See also: https://www.theguardian.com/lifeandstyle/2015/apr/11/secret-history-monopoly-capitalist-game-leftwing-origins https://www.theguardian.com/lifeandstyle/2015/apr/11/secret-... [edit: here are the combined rules with rules for "prosperity" https://landlordsgame.info/games/lgp-1932/lgp-1932_rules.html https://landlordsgame.info/games/lgp-1932/lgp-1932_rules.htm... ]
- bhelkey 7y ago
  If the two people involved in the two people involved in the trade are exactly x better off and the, lets say, two people not involved in the trade are exactly x worse off, that transaction is still zero-sum. Zero-sum games are not limited to two player games.
- stiglitz 7y ago
  You are only better off in the sense of having more opportunities to collect rent from each other. The result is still zero-sum. Here’s a mental shortcut: as long as the objective of the game is to bankrupt all other players (i.e. to own all of the money), the game is zero-sum. No other details matter. It’s a cake-cutting game where everybody wants all the cake.
xg15 7y ago
> my intentional actions (successful business) Your intentional action is to start a business. Whether or not it will be a successful business and actually "generate wealth" is to a large part dependant an chance. Also, honestly, "It's not a zero-sum game" is beginning to sound like a religious mantra. Of course you can define "wealth" however your want and for the right definitions, you can certainly pull ever more of it out of nowhere. The set of natural numbers has no upper bound. However, many extremely relevant kinds of wealth absolutely are zero-sum: There is only so much time in a day, only so much space to live in, only so many natural resources and only so much waste the planet will tolerate. If some class of people control disproportionately amounts of that, it will absolutely reduce the wealth of those who don't belong to that class.
- chrisco255 7y ago
  No, it's not dependent on chance. It's not some random spin on a roulette wheel. It depends on if you are offering a service that is valued by the marketplace. There may be only so much time in a day, but the critical factor in wealth creation is how much you can get done in a day (productivity). You can also figure out clever ways to get more out of what you have (efficiency).
  - cryptica 7y ago
    >> It depends on if you are offering a service that is valued by the marketplace And who decides what is valued by the marketplace? It's: - Politicians through regulation. - The Federal Reserve Bank by continuously creating new money out of thin air. - Banks by deciding who can get the newly printed Fed money through loans and who can't (typically based on the value of assets which individuals already have; the result is that rich people get most of the new money through almost 0% interest loans). - Corporate monopolies by locking out competitors (through lobbying government for beneficial regulations or making it prohibitively expensive for other companies to compete due to price gouging, international tax arbitrage, allowing losses in some sectors to selectively wipe out competitors in other sectors, incentivizing journalists to promote the corporate agenda, etc...) As a small startup, you can be as efficient as you like. If some corporation doesn't want you to succeed, they can easily drain your coffers and crush you without drawing any attention to themselves. It's not about productivity or cleverness; that has very little value these days. Economic value these days lies in one's ability to control the social narrative and the money supply; it doesn't matter what the reality is. If you have unlimited money, you can literally pay people to sit on their asses and pick their noses all day; you can even convince them that this is helping the company and therefore the whole economy... The company keeps getting more money year after year so somehow all this nose-picking must be paying off right? The massive hose of Federal Reserve cash plugged straight into the back of the company is just a minor detail. And the farmers who feed everyone are fools for accepting this electronic play money in exchange for their useful work.
TheOtherHobbes 7y ago
You're confusing your hypothetical personal success with the state of the system as a whole. Most businesses will fail, and most businesses are built on loans of some kind rather than bootstrapped. Rent-seekers will try to profit from this because they will claw back their "investment" in the form of collateral - preferably physical, but IP as a last resort. If businesses succeed, rent-seekers will profit from their "investment" with an aggressive term sheet that gives their return priority over returns for the people who did the work. At the same time, rent-seekers will be investing in property. If there's a run of successful businesses in an area they will gain by increasing rents and speculating on property prices. This is basically just asset inflation - very good for rent-seekers, very bad for people who need access to limited resources like housing and health care. This isn't even getting into the costs of externalities. The picture as a whole is a lot more complicated than "My business succeeded and now I'm making money, so there's no zero sum here."
- dr_dshiv 7y ago
  Wow, that's really depressing. I thought hard work and good ideas were important and valuable contributions to society.
  - wolfram74 7y ago
    The mathematical description might be "necessary but not sufficient".
  - iso1210 7y ago
    Yes, that's the american dream. The problem with america is too many people believe the american dream, that you can go 'rags to riches' with hard work and perseverance. The people working 90 hour weeks and barely able to make rent apparently aren't working hard enough.
    - chrisco255 7y ago
      You can. I used to work in a retirement community in Florida. I met thousands of retirees who either through their own business or from stock earned in a corporate job or from a solid 401K savings had more than $1 million in net worth. There's more than 10 million households with a net worth of over $1 million in the U.S [1]. It's not hard work and perseverance that matters. It's smart work and money management that matters. [1] https://www.statista.com/statistics/617390/us-millionaire-households/ https://www.statista.com/statistics/617390/us-millionaire-ho...
cryptica 7y ago
>> my intentional actions (successful business) Yeah of course because you have full control of what happens to your business. Your competitors, big corporate monopolies, regulators, investors, fickle cultural trends, politics, timing, your wealthy friends or family members and your own health have no impact at all on your business' chance of success.
- chrisco255 7y ago
  Running a business is an exercise in risk management. All of the things you mentioned are interesting challenges, but they're not insurmountable. While there are few guarantees in life, one sure fired way to lose to all those factors is to make them bigger than they are.
  - cryptica 7y ago
    >> but they're not insurmountable If your health is so bad that you die, that's insurmountable. If regulations are so rigid that the government forbids you to open your business, that's insurmountable. If a corporation sets up shop next door and sells everything you sell at half the price, that's insurmountable. Then also milder combinations of all of the above can be insurmountable.
btilly 7y ago
I'll admit, the creation of new wealth/money is very mysterious. How to know when it is growing the pie? Wealth is stuff that people want. You create wealth by creating stuff that other people want. http://www.paulgraham.com/wealth.html http://www.paulgraham.com/wealth.html has a long version of this explanation. The last 200 years have seen a dramatic transformation as we have found ways to efficiently create more wealth, with the result that we all have more stuff that we want than pretty much anyone used to. Both new kinds of stuff (effective medicine, gadgets like washing machines, electronic devices...) and the kinds of stuff we used to have (food, potable water, etc...). And yet, people still emotionally fall prey to the old fallacy that more for thee means less for me. The truth is that there is no society on record that has managed to lower inequity without major disaster such as war or plague. And also no society on record that has managed to increase the prosperity of the poor without seeing income gaps rise. (Read Enlightenment Now for a lot more detail on both of these phenomena.) Or, as Margaret Thatcher put it, "...he would rather that the poor were poorer provided the rich were less rich." (See https://speakola.com/political/margaret-thatcher-on-socialism-last-speech-1990 https://speakola.com/political/margaret-thatcher-on-socialis... for the full quote.)
three_seagrass 7y ago
>It is zero sum, because no intentional action can increase wealth It's a probability game. The action of buying a property increases wealth proportionate to the risk of someone landing on it, hence that intentional action increases wealth as a function. That doesn't make the game zero sum, especially when you add in the variable income bits of passing go or mortgaging properties.

sokoloff 7y ago

I would argue that if I hold 2 of the yellow and 1 of the green properties and you hold 1 of the yellow and 2 of the green in a 3+ person game, that we do have an intentional action that can leave us both better off.

dr_dshiv 7y ago
Is trading legal in Monopoly? I'm assuming that's what you are referring to.
- jmpman 7y ago
  It is in my house.
- sokoloff 7y ago
  Yes. It's part of the official rules (and the absence of it would be fairly disastrous to the game dynamics I think).
- e12e 7y ago
  Apparently not in the original : http://landlordsgame.info/rules/lg-1904p_patent.html http://landlordsgame.info/rules/lg-1904p_patent.html However: > Borrowing: A player may borrow from the “Bank" in amounts of one hundred dollars, and for every one hundred dollars borrowed the " Bank" takes a mortgage on one or more of the borrower's lots, the total value of which must be at least ten dollars more than is borrowed. For every one hundred dollars borrowed from the "Bank" a bank mortgage is placed upon the property on which the loan is made, and the player puts his note in the "Bank," paying upon each note five dollars (interest) every time he receives his wages. One player may borrow from another, giving a mortgage on any property he may own and making the best bargain he can as to interest, terms of payments &c. The player loaning the money places his individual, mortgage on the top of the borrower's deed to show that he has a mortgage on that property, Should a loan be repaid before passing the beginning-point, the borrower saves the interest. But there are a few variations... This one looks closer to "modern" monopoly - I can't seem to locate the "two rulesets" referenced by Wikipedia though (one "pro" one "contra" monopoly - in the second everyone supposedly benefits from created value). http://landlordsgame.info/games/lg-1906/lg-1906_egc-rules.html http://landlordsgame.info/games/lg-1906/lg-1906_egc-rules.ht... https://en.m.wikipedia.org/wiki/Monopoly_(game) https://en.m.wikipedia.org/wiki/Monopoly_(game) > Magie created two sets of rules: an anti-monopolist set in which all were rewarded when wealth was created, and a monopolist set in which the goal was to create monopolies and crush opponents. See also: https://www.theguardian.com/lifeandstyle/2015/apr/11/secret-history-monopoly-capitalist-game-leftwing-origins https://www.theguardian.com/lifeandstyle/2015/apr/11/secret-... [edit: here are the combined rules with rules for "prosperity" https://landlordsgame.info/games/lgp-1932/lgp-1932_rules.html https://landlordsgame.info/games/lgp-1932/lgp-1932_rules.htm... ]
bhelkey 7y ago
If the two people involved in the two people involved in the trade are exactly x better off and the, lets say, two people not involved in the trade are exactly x worse off, that transaction is still zero-sum. Zero-sum games are not limited to two player games.
stiglitz 7y ago
You are only better off in the sense of having more opportunities to collect rent from each other. The result is still zero-sum. Here’s a mental shortcut: as long as the objective of the game is to bankrupt all other players (i.e. to own all of the money), the game is zero-sum. No other details matter. It’s a cake-cutting game where everybody wants all the cake.

xg15 7y ago

> my intentional actions (successful business) Your intentional action is to start a business. Whether or not it will be a successful business and actually "generate wealth" is to a large part dependant an chance. Also, honestly, "It's not a zero-sum game" is beginning to sound like a religious mantra. Of course you can define "wealth" however your want and for the right definitions, you can certainly pull ever more of it out of nowhere. The set of natural numbers has no upper bound. However, many extremely relevant kinds of wealth absolutely are zero-sum: There is only so much time in a day, only so much space to live in, only so many natural resources and only so much waste the planet will tolerate. If some class of people control disproportionately amounts of that, it will absolutely reduce the wealth of those who don't belong to that class.

chrisco255 7y ago
No, it's not dependent on chance. It's not some random spin on a roulette wheel. It depends on if you are offering a service that is valued by the marketplace. There may be only so much time in a day, but the critical factor in wealth creation is how much you can get done in a day (productivity). You can also figure out clever ways to get more out of what you have (efficiency).
- cryptica 7y ago
  >> It depends on if you are offering a service that is valued by the marketplace And who decides what is valued by the marketplace? It's: - Politicians through regulation. - The Federal Reserve Bank by continuously creating new money out of thin air. - Banks by deciding who can get the newly printed Fed money through loans and who can't (typically based on the value of assets which individuals already have; the result is that rich people get most of the new money through almost 0% interest loans). - Corporate monopolies by locking out competitors (through lobbying government for beneficial regulations or making it prohibitively expensive for other companies to compete due to price gouging, international tax arbitrage, allowing losses in some sectors to selectively wipe out competitors in other sectors, incentivizing journalists to promote the corporate agenda, etc...) As a small startup, you can be as efficient as you like. If some corporation doesn't want you to succeed, they can easily drain your coffers and crush you without drawing any attention to themselves. It's not about productivity or cleverness; that has very little value these days. Economic value these days lies in one's ability to control the social narrative and the money supply; it doesn't matter what the reality is. If you have unlimited money, you can literally pay people to sit on their asses and pick their noses all day; you can even convince them that this is helping the company and therefore the whole economy... The company keeps getting more money year after year so somehow all this nose-picking must be paying off right? The massive hose of Federal Reserve cash plugged straight into the back of the company is just a minor detail. And the farmers who feed everyone are fools for accepting this electronic play money in exchange for their useful work.

TheOtherHobbes 7y ago

You're confusing your hypothetical personal success with the state of the system as a whole. Most businesses will fail, and most businesses are built on loans of some kind rather than bootstrapped. Rent-seekers will try to profit from this because they will claw back their "investment" in the form of collateral - preferably physical, but IP as a last resort. If businesses succeed, rent-seekers will profit from their "investment" with an aggressive term sheet that gives their return priority over returns for the people who did the work. At the same time, rent-seekers will be investing in property. If there's a run of successful businesses in an area they will gain by increasing rents and speculating on property prices. This is basically just asset inflation - very good for rent-seekers, very bad for people who need access to limited resources like housing and health care. This isn't even getting into the costs of externalities. The picture as a whole is a lot more complicated than "My business succeeded and now I'm making money, so there's no zero sum here."

dr_dshiv 7y ago
Wow, that's really depressing. I thought hard work and good ideas were important and valuable contributions to society.
- wolfram74 7y ago
  The mathematical description might be "necessary but not sufficient".
- iso1210 7y ago
  Yes, that's the american dream. The problem with america is too many people believe the american dream, that you can go 'rags to riches' with hard work and perseverance. The people working 90 hour weeks and barely able to make rent apparently aren't working hard enough.
  - chrisco255 7y ago
    You can. I used to work in a retirement community in Florida. I met thousands of retirees who either through their own business or from stock earned in a corporate job or from a solid 401K savings had more than $1 million in net worth. There's more than 10 million households with a net worth of over $1 million in the U.S [1]. It's not hard work and perseverance that matters. It's smart work and money management that matters. [1] https://www.statista.com/statistics/617390/us-millionaire-households/ https://www.statista.com/statistics/617390/us-millionaire-ho...

cryptica 7y ago

>> my intentional actions (successful business) Yeah of course because you have full control of what happens to your business. Your competitors, big corporate monopolies, regulators, investors, fickle cultural trends, politics, timing, your wealthy friends or family members and your own health have no impact at all on your business' chance of success.

chrisco255 7y ago
Running a business is an exercise in risk management. All of the things you mentioned are interesting challenges, but they're not insurmountable. While there are few guarantees in life, one sure fired way to lose to all those factors is to make them bigger than they are.
- cryptica 7y ago
  >> but they're not insurmountable If your health is so bad that you die, that's insurmountable. If regulations are so rigid that the government forbids you to open your business, that's insurmountable. If a corporation sets up shop next door and sells everything you sell at half the price, that's insurmountable. Then also milder combinations of all of the above can be insurmountable.

btilly 7y ago

I'll admit, the creation of new wealth/money is very mysterious. How to know when it is growing the pie? Wealth is stuff that people want. You create wealth by creating stuff that other people want. http://www.paulgraham.com/wealth.html http://www.paulgraham.com/wealth.html has a long version of this explanation. The last 200 years have seen a dramatic transformation as we have found ways to efficiently create more wealth, with the result that we all have more stuff that we want than pretty much anyone used to. Both new kinds of stuff (effective medicine, gadgets like washing machines, electronic devices...) and the kinds of stuff we used to have (food, potable water, etc...). And yet, people still emotionally fall prey to the old fallacy that more for thee means less for me. The truth is that there is no society on record that has managed to lower inequity without major disaster such as war or plague. And also no society on record that has managed to increase the prosperity of the poor without seeing income gaps rise. (Read Enlightenment Now for a lot more detail on both of these phenomena.) Or, as Margaret Thatcher put it, "...he would rather that the poor were poorer provided the rich were less rich." (See https://speakola.com/political/margaret-thatcher-on-socialism-last-speech-1990 https://speakola.com/political/margaret-thatcher-on-socialis... for the full quote.)

three_seagrass 7y ago

>It is zero sum, because no intentional action can increase wealth It's a probability game. The action of buying a property increases wealth proportionate to the risk of someone landing on it, hence that intentional action increases wealth as a function. That doesn't make the game zero sum, especially when you add in the variable income bits of passing go or mortgaging properties.