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I think we can use Vickrey Auctions for this problem. Vickrey Auctions are able to give not only price discovery, but also value discovery. Vickrey auctions inc
by ItsMonkk 5y ago
I think we can use Vickrey Auctions for this problem. Vickrey Auctions are able to give not only price discovery, but also value discovery. Vickrey auctions incentivize bidders to bid their true value. If instead of using price discovery, we use value discovery, the price can stay at 0, so long as a certain (limited) amount of people are faced with a choice that would have them go without.
So for example perhaps we sample 50,000 people and say 75% of people keep access, say when they vote. If you bid in the top 75%, you keep access for the period, and you pay the value that the bottom person that kept access bid. That money is then not used to pay for the IP, some other tax will fund the IP or Open Source Software or Meme, that 25% will then go to all the voters for providing their values. So the average bidder will pay nothing, the below average bidder will lose something they value low, but gain, and the highest bidders will fund that. We then take some other collection and sample another 50,000 people, until we find out the value of all of these digital items to people.
If you do the subsidization process correctly, I think the idea of IP owners holding their supply back would go away, as releasing it to all would always provide more value than holding it back. I think at the very least this would be an obvious answer to Open Source Software, and this would easily fund things like Linux and Firefox. I think this would stretch further to research, and colleges would now be funded through this mechanism, and the professors who currently waste enormous amounts of time doing grant writing would be able to be productive. Thus the whole issue of journals goes away. Even things like ads, people would bid on their service less because of them, so there would be no fundamental reason to include them as it would reduce the subsidy.
- __MatrixMan__ 5y agoI had not heard of those before, that's cool.
- preseinger 5y agoI'm sorry, I have no idea how this relates to either of my questions. Can you clarify? -- > The end-game of economics ought to be to eliminate scarcity This doesn't make sense. Economics isn't something with a goal, it's a praxis which exists solely to manage scarcity. Eliminate scarcity and economics disappears.
- ItsMonkk 5y agoWhen you grant a monopoly over items that have zero marginal costs, you are creating massive dead-weight losses. The reason that we use artificial scarcity is because then we can use supply and demand on that, and use the funds to reward the creator. There will always be new things to create. Some think that because IP is a monopoly, you should tax the monopoly. But that's going at it from the wrong direction. Creating new things produces a positive externality to others. You want to reward that. This is a scheme that might possibly do so.
- preseinger 5y agoI'm sorry, I don't understand how any of this responds to my questions. I didn't ask about monopolies, I didn't ask why artificial scarcity exists, I didn't ask about intellectual property.
- ItsMonkk 5y agoYou asked how to have an economy without scarcity. There will always be certain things, like natural resources, that are scarce. You can not make more land. Those things will always have scarcity. There are other things that have zero marginal costs, and can indeed eliminate scarcity. But if you eliminate scarcity on those items, there becomes no incentive to create new things, as the natural price of anything with infinite supply is zero. The creation of new digital items needs to be balanced with the very real scarcity of natural resources. The essence of your question is - how do we reward the creation of things if we can not restrict the use of it? And so we need to find a way to figure out the value of infinite supply items.