5 ms·

"What does it mean for the economies of these up-and-coming world powers? Well, probably the same thing that it means for everyone else: The automators will con

by beedogs 12y ago

"What does it mean for the economies of these up-and-coming world powers? Well, probably the same thing that it means for everyone else: The automators will continue to get very, very rich, while the automated will have to find something else to do." Or, you know, basic income. Why is the answer to "there are no jobs anymore" always "well, I guess you can starve, then"?

noonespecial 12y ago
Its almost like a signaling error. A farmer would gladly grow corn in exchange for a tractor and a mechanic would gladly supply that tractor in exchange for corn, but the corn that theoretically could be factory farmed by automation would be cheaper than the farmer can grown and the robot built tractor would theoretically be cheaper than the mechanic can build so neither do anything. Both farmer and mechanic starve and then the automated systems make neither corn nor tractor while the capital owner wonders why no one is buying. The whole system would be made richer by injecting the small signal a basic income would provide into the negative feedback loop thats keeping it damped.
- zalzane 12y ago
  The second half of your post just gave me a vietnam flashback to Linear Systems back in college I wonder if you could actually model economic systems using impulse response and signal filtering mathematics
  - anigbrowl 12y ago
    Absolutely you could. Indeed, it has arguably already been done, albeit indirectly: http://en.wikipedia.org/wiki/MONIAC_Computer http://en.wikipedia.org/wiki/MONIAC_Computer
  - quanticle 12y ago
    I don't know about impulse response and signal filtering, but the Soviets did try to model their economy with linear models. Cosma Shalizi put up a good analysis [1] of why this is very very difficult. Simply put, any kind of "real" economy has so many variables (in the kinds of goods and services, their various quality levels, and the locations in both time and space that goods and services have to be) that any kind of linear programming quickly gets swamped by the sheer number of variables that have to be adjusted in order to compute an optimal outcome. So yes, in theory you can model an economy using a linear system. It's not even an NP problem. But in practice, the computational complexity is high enough (though still within P) that even toy economies with as few as a thousand elements become impossible to optimize with linear programming. [1] http://crookedtimber.org/2012/05/30/in-soviet-union-optimization-problem-solves-you/ http://crookedtimber.org/2012/05/30/in-soviet-union-optimiza...
  - troymc 12y ago
    Most real-world economic systems aren't anywhere close to linear. Economists do love their toy models, and some of those are linear. They also make wrong predictions. Anyone who thinks economics has useful, reliable mathematical models akin to those in physics is fooling themselves.
- AnthonyMouse 12y ago
  > Both farmer and mechanic starve and then the automated systems make neither corn nor tractor while the capital owner wonders why no one is buying. I don't think your math works out. If a tractor is worth more in the market than the corn then the mechanic is better off to sell the tractor and buy corn in the market than trade with the farmer, and vice versa if the corn is worth more in the market than the tractor. Making the trade only makes sense if the tractor and the corn have the same market value, but in that case they could both just as easily sell to the market rather than bartering. Automation is only a problem when it lowers the price of the things you're selling but not the price of the things you're buying.
  - rtpg 12y ago
    I don't see how automation of growing corn will make iPhones cheaper.
deleted 12y ago
[deleted]
anigbrowl 12y ago
Very possibly, but proponents of a basic income consistently fail to articulate three things: how these monies will be collected, what rationale there is for distributing it (other than the implicit acknowledgement that the alternative is civil unrest) and why it won't be inflationary.
- AnthonyMouse 12y ago
  > how these monies will be collected Taxation. > what rationale there is for distributing it (other than the implicit acknowledgement that the alternative is civil unrest) A basic income removes the need for a long list of bureaucratic social programs like social security, food stamps, housing assistance, pell grants, etc. etc. It's the free market solution for social welfare programs. You allow individuals to decide what they need rather than having the government decide from the office of central planning. It also eliminates means testing much to the benefit of the middle class (and simplicity and economic efficiency). > why it won't be inflationary Inflation comes from increasing the money supply faster than the size of the economy increases. Inflation would only occur if the money paid out was newly printed. When it comes from taxation the amount of money in circulation is unchanged, only the parties holding it change.
  - yummyfajitas 12y ago
    Inflation comes from increasing the money supply faster than the size of the economy increases. This is a strange Austrian definition and is not widely accepted. The normal definition of inflation is increases in the value of a basket of consumption. CPI is a good proxy for this over the short term (in the long term CPI becomes useless for this purpose since the basket changes). If BI increases demand for consumption (as most of it's proponents claim it will), then the price of consumption will increase - hence, inflation.
    - sheepmullet 12y ago
      "If BI increases demand for consumption (as most of it's proponents claim it will), then the price of consumption will increase - hence, inflation." Increased consumption does not necessarily lead to a long term price increase. Often it results in lower prices due to ability to invest in projects with larger upfront/fixed costs. The only goods that would necessarily increase in price are ones where the supply is currently at, or close to, capacity, and it is difficult/expensive to increase the supply. This isn't the case for most goods.
zo1 12y ago
Not everyone says that as the answer. Way to straw-man and present a false dichotomy, both in one sentence. Or, how about if I claim that there is a certain "group" of people that after being presented with any sort of economic problem pipe-up with a "matter-of-factly" and "know-it-all" attitude that we should: "you know, basic income". Things are a little more complicated than that, beedogs.

by beedogs 12y ago

noonespecial 12y ago

Its almost like a signaling error. A farmer would gladly grow corn in exchange for a tractor and a mechanic would gladly supply that tractor in exchange for corn, but the corn that theoretically could be factory farmed by automation would be cheaper than the farmer can grown and the robot built tractor would theoretically be cheaper than the mechanic can build so neither do anything. Both farmer and mechanic starve and then the automated systems make neither corn nor tractor while the capital owner wonders why no one is buying. The whole system would be made richer by injecting the small signal a basic income would provide into the negative feedback loop thats keeping it damped.

zalzane 12y ago
The second half of your post just gave me a vietnam flashback to Linear Systems back in college I wonder if you could actually model economic systems using impulse response and signal filtering mathematics
- anigbrowl 12y ago
  Absolutely you could. Indeed, it has arguably already been done, albeit indirectly: http://en.wikipedia.org/wiki/MONIAC_Computer http://en.wikipedia.org/wiki/MONIAC_Computer
- quanticle 12y ago
  I don't know about impulse response and signal filtering, but the Soviets did try to model their economy with linear models. Cosma Shalizi put up a good analysis [1] of why this is very very difficult. Simply put, any kind of "real" economy has so many variables (in the kinds of goods and services, their various quality levels, and the locations in both time and space that goods and services have to be) that any kind of linear programming quickly gets swamped by the sheer number of variables that have to be adjusted in order to compute an optimal outcome. So yes, in theory you can model an economy using a linear system. It's not even an NP problem. But in practice, the computational complexity is high enough (though still within P) that even toy economies with as few as a thousand elements become impossible to optimize with linear programming. [1] http://crookedtimber.org/2012/05/30/in-soviet-union-optimization-problem-solves-you/ http://crookedtimber.org/2012/05/30/in-soviet-union-optimiza...
- troymc 12y ago
  Most real-world economic systems aren't anywhere close to linear. Economists do love their toy models, and some of those are linear. They also make wrong predictions. Anyone who thinks economics has useful, reliable mathematical models akin to those in physics is fooling themselves.
AnthonyMouse 12y ago
> Both farmer and mechanic starve and then the automated systems make neither corn nor tractor while the capital owner wonders why no one is buying. I don't think your math works out. If a tractor is worth more in the market than the corn then the mechanic is better off to sell the tractor and buy corn in the market than trade with the farmer, and vice versa if the corn is worth more in the market than the tractor. Making the trade only makes sense if the tractor and the corn have the same market value, but in that case they could both just as easily sell to the market rather than bartering. Automation is only a problem when it lowers the price of the things you're selling but not the price of the things you're buying.
- rtpg 12y ago
  I don't see how automation of growing corn will make iPhones cheaper.

deleted 12y ago

[deleted]

anigbrowl 12y ago

Very possibly, but proponents of a basic income consistently fail to articulate three things: how these monies will be collected, what rationale there is for distributing it (other than the implicit acknowledgement that the alternative is civil unrest) and why it won't be inflationary.

AnthonyMouse 12y ago
> how these monies will be collected Taxation. > what rationale there is for distributing it (other than the implicit acknowledgement that the alternative is civil unrest) A basic income removes the need for a long list of bureaucratic social programs like social security, food stamps, housing assistance, pell grants, etc. etc. It's the free market solution for social welfare programs. You allow individuals to decide what they need rather than having the government decide from the office of central planning. It also eliminates means testing much to the benefit of the middle class (and simplicity and economic efficiency). > why it won't be inflationary Inflation comes from increasing the money supply faster than the size of the economy increases. Inflation would only occur if the money paid out was newly printed. When it comes from taxation the amount of money in circulation is unchanged, only the parties holding it change.
- yummyfajitas 12y ago
  Inflation comes from increasing the money supply faster than the size of the economy increases. This is a strange Austrian definition and is not widely accepted. The normal definition of inflation is increases in the value of a basket of consumption. CPI is a good proxy for this over the short term (in the long term CPI becomes useless for this purpose since the basket changes). If BI increases demand for consumption (as most of it's proponents claim it will), then the price of consumption will increase - hence, inflation.
  - sheepmullet 12y ago
    "If BI increases demand for consumption (as most of it's proponents claim it will), then the price of consumption will increase - hence, inflation." Increased consumption does not necessarily lead to a long term price increase. Often it results in lower prices due to ability to invest in projects with larger upfront/fixed costs. The only goods that would necessarily increase in price are ones where the supply is currently at, or close to, capacity, and it is difficult/expensive to increase the supply. This isn't the case for most goods.

zo1 12y ago

Not everyone says that as the answer. Way to straw-man and present a false dichotomy, both in one sentence. Or, how about if I claim that there is a certain "group" of people that after being presented with any sort of economic problem pipe-up with a "matter-of-factly" and "know-it-all" attitude that we should: "you know, basic income". Things are a little more complicated than that, beedogs.