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Alert: Newbie to economics here sharing some thoughts for feedback. At time t -> infinity, the ideal state would not be humans not having jobs (machines takin

by alok-g 14y ago

Alert: Newbie to economics here sharing some thoughts for feedback. At time t -> infinity, the ideal state would not be humans not having jobs (machines taking over), but humans not "needing" jobs (machines doing everything we need to do today). This may however never be since natural resources are limited, and so the cost of goods (while reducing due to economically cheaper machines taking over) would never come to zero. So then, as time progresses, the jobs for humans would end up being at the end of the production-possibility frontier [1] where their sole motive is to figure new things (entrepreneurship), while the machines take care of existing methods of producing. [1] http://en.wikipedia.org/wiki/Production-possibility_frontier http://en.wikipedia.org/wiki/Production-possibility_frontier

wissler 14y ago
Natural resources are virtually unlimited, at least for the current size of the human race. We're only just scratching the surface of the resources available on Earth, and there's a whole solar system we have access to. The only issue is the technology required to transform these resources into something useful, and the "permission" to create and deploy such technology.
- Surio 14y ago
  >> Natural resources are virtually unlimited at least for the current size of the human race I was sort of nodding in agreement at another comment you left elsewhere but this one is just not on. This belief is definitely at odds with mine (specially going in with Club of Rome studies on this topic, for e.g.).
  - wissler 14y ago
    It's not useful to just say you disagree. You ought to say why. The fact is that matter is virtually unlimited, and it is not against the laws of physics that we can transform matter into more useful kinds, that we can deploy various means of collecting energy from the sun (even extraterrestrial), that we can learn how to fuse hydrogen, etc. Edit: I guess you sort of did indicate why you disagreed, but referring to "Club of Rome" is just argument from authority, and anyway their study flies in the face of common sense. We know the Earth is brimming over with energy and resources, that the main difficulty is collecting and transforming them. This is a technological problem not a fundamentally unresolvable problem.
- Crake 14y ago
  Two words: peak oil.
- evolve2k 14y ago
  Not so. The assumption of 'unlimited natural resources' is now at odds with modern economic theory. By seeing natural resources as limitless and by extension free at source undervalues their net economic contribution. Take the example of massive ocean trawlers that cast kilometer wide nets then bring back all the catch to sell at market. The trawler is not creating the value of the fish just facilitating an arbitrage for the cost of delivery. Companies are now looking at ways they can put a financial value on the value of their natural resource inputs. A failure in quantifying and pricing resources creates a mindset problem when resources turn out not to be limitless or indescuctuble. The World Bank, in it's 2011 report 'The Changing Wealth of Nations', set the estimates for all the planets natural resources - its forests, rivers, wetlands, wild lands, farm and grazing lands, minerals, oil and coal, oceans, biodiversity of speciecs - at about $44 trillion dollars, with $29 trillion belonging to developing nations. Ref: HBR Oct 2011, the sustainable economy
  - wissler 14y ago
    Those figures by "economists" are woefully, comically limited, they only consider natural resources as determined by current limits of politics and technology, but in fact the whole solar system is rich with natural resources, just waiting for people who actually have imagination (and liberty from the punks who listen to those economists) to begin to capture.
    - wissler 14y ago
      E.g., we can't even increase fish farming productivity without massive political interference: http://www.nature.com/news/transgenic-fish-wins-us-regulatory-backing-1.12130 http://www.nature.com/news/transgenic-fish-wins-us-regulator...
brianchu 14y ago
Understanding that you're a "newbie to economics" I'd like to point out that the concept of the production-possibility frontier is misapplied here. The PPF deals with economic efficiency (whether an economy is producing at its potential) and relative allocations of production of capital goods vs. consumer goods. An economy is said to be producing at the edge of its PPF if there is 100% efficiency (full employment). An economy producing at a point under its PPF is associated with inefficiency (unemployment). The way you use the term does not make sense. Secondly, economics is concerned with the efficient allocation of scarce resources among unlimited wants. Human want is insatiable, and that's a pretty fair assumption. Even in some hyper-futuristic world, someone out there is going to want their own planet or some other kind of luxury status good. Even if everyone gets their own planet, you still have the dilemma of the fact that having a planet won't be a luxury good anymore (and something else might). This is one of the fundamental assumptions of economics. Whether or not natural resources are scarce depends on whether you want to factor in resources in the Solar System / universe. Even in that scenario, it's a question of time scale: The problem is that I believe we are likely to achieve levels of automation where 99.99% of human jobs are eliminated before we can utilize natural resources beyond our Solar System, and before we can achieve a point where humans are so satisfied they desire nothing more (excepting the occasional planet or two).
- maxerickson 14y ago
  It's easy enough to imagine some sort of economics-like practice that manages to aim for equitable allocation of abundant resources among impractical wants.
- alok-g 14y ago
  For the PPF, I meant to say that the job for humans may be to figure new ways of doing things that can make the economy more efficient. Unless singularity is achieved, I presume machines can only do what humans have designed/told them to do. So machines would be limited to following known methods of making things where humans may ultimately be out of jobs.

by alok-g 14y ago

wissler 14y ago

Natural resources are virtually unlimited, at least for the current size of the human race. We're only just scratching the surface of the resources available on Earth, and there's a whole solar system we have access to. The only issue is the technology required to transform these resources into something useful, and the "permission" to create and deploy such technology.

Surio 14y ago
>> Natural resources are virtually unlimited at least for the current size of the human race I was sort of nodding in agreement at another comment you left elsewhere but this one is just not on. This belief is definitely at odds with mine (specially going in with Club of Rome studies on this topic, for e.g.).
- wissler 14y ago
  It's not useful to just say you disagree. You ought to say why. The fact is that matter is virtually unlimited, and it is not against the laws of physics that we can transform matter into more useful kinds, that we can deploy various means of collecting energy from the sun (even extraterrestrial), that we can learn how to fuse hydrogen, etc. Edit: I guess you sort of did indicate why you disagreed, but referring to "Club of Rome" is just argument from authority, and anyway their study flies in the face of common sense. We know the Earth is brimming over with energy and resources, that the main difficulty is collecting and transforming them. This is a technological problem not a fundamentally unresolvable problem.
Crake 14y ago
Two words: peak oil.
evolve2k 14y ago
Not so. The assumption of 'unlimited natural resources' is now at odds with modern economic theory. By seeing natural resources as limitless and by extension free at source undervalues their net economic contribution. Take the example of massive ocean trawlers that cast kilometer wide nets then bring back all the catch to sell at market. The trawler is not creating the value of the fish just facilitating an arbitrage for the cost of delivery. Companies are now looking at ways they can put a financial value on the value of their natural resource inputs. A failure in quantifying and pricing resources creates a mindset problem when resources turn out not to be limitless or indescuctuble. The World Bank, in it's 2011 report 'The Changing Wealth of Nations', set the estimates for all the planets natural resources - its forests, rivers, wetlands, wild lands, farm and grazing lands, minerals, oil and coal, oceans, biodiversity of speciecs - at about $44 trillion dollars, with $29 trillion belonging to developing nations. Ref: HBR Oct 2011, the sustainable economy
- wissler 14y ago
  Those figures by "economists" are woefully, comically limited, they only consider natural resources as determined by current limits of politics and technology, but in fact the whole solar system is rich with natural resources, just waiting for people who actually have imagination (and liberty from the punks who listen to those economists) to begin to capture.
  - wissler 14y ago
    E.g., we can't even increase fish farming productivity without massive political interference: http://www.nature.com/news/transgenic-fish-wins-us-regulatory-backing-1.12130 http://www.nature.com/news/transgenic-fish-wins-us-regulator...

brianchu 14y ago

Understanding that you're a "newbie to economics" I'd like to point out that the concept of the production-possibility frontier is misapplied here. The PPF deals with economic efficiency (whether an economy is producing at its potential) and relative allocations of production of capital goods vs. consumer goods. An economy is said to be producing at the edge of its PPF if there is 100% efficiency (full employment). An economy producing at a point under its PPF is associated with inefficiency (unemployment). The way you use the term does not make sense. Secondly, economics is concerned with the efficient allocation of scarce resources among unlimited wants. Human want is insatiable, and that's a pretty fair assumption. Even in some hyper-futuristic world, someone out there is going to want their own planet or some other kind of luxury status good. Even if everyone gets their own planet, you still have the dilemma of the fact that having a planet won't be a luxury good anymore (and something else might). This is one of the fundamental assumptions of economics. Whether or not natural resources are scarce depends on whether you want to factor in resources in the Solar System / universe. Even in that scenario, it's a question of time scale: The problem is that I believe we are likely to achieve levels of automation where 99.99% of human jobs are eliminated before we can utilize natural resources beyond our Solar System, and before we can achieve a point where humans are so satisfied they desire nothing more (excepting the occasional planet or two).

maxerickson 14y ago
It's easy enough to imagine some sort of economics-like practice that manages to aim for equitable allocation of abundant resources among impractical wants.
alok-g 14y ago
For the PPF, I meant to say that the job for humans may be to figure new ways of doing things that can make the economy more efficient. Unless singularity is achieved, I presume machines can only do what humans have designed/told them to do. So machines would be limited to following known methods of making things where humans may ultimately be out of jobs.