Saturday, November 22, 2014

No "Maker" or "Taker" Designations Necessary

...After all, communities which internalize time use aggregates for local production and services, would be able to ensure that citizens become one and the same. In my last post, I posed a question: Why are citizens and policy makers inclined to apply "maker" versus "taker" identities in struggles over government benefits, instead of providing more accessible means for economic prosperity?

Even though some Republicans are quick to point to the "takers" of society, the fact remains that plenty of "makers" have been able to strengthen their hand for a long time, with government's help. Some markets become quite lucrative when limits to entry are imposed. But eventually, it's a process which eventually begins to exclude further economic formation. Hence knowledge use limits have plenty of bearing, as to why some takers players are in a bind with scarcely any cards left in the game of life.

Granted, many prosperous areas in the U.S. do not have enough room to bring in new citizens and productive endeavor. In some instances, local citizens should not be expected to greatly increase population density, given previous commitments for the environmental definition they already have. This is particularly true, where unique geographic formation has lead to higher and more complex services valuations. But many open spaces exist in the U.S., where new starts or "games" would be possible. Primary knowledge use need not be limited, to the main economic regions of the present.

By "growing" the pie - i.e. knowledge use marketplace along new margins - citizens need not be threatened by anyone - including immigrants - who still seek economic entry. Exit and voice can be generated in new settings which do not directly compete with the old. This could broaden the horizons and wealth potential of anyone who lacks ability to gain entry, elsewhere.

In these new settings, monetary compensation for services coordination, would serve multiple purposes. How so? Those who gain a place to start anew, have a chance to escape other less positive identities which often impose burdens on government budgets.

Consider the services approach for municipalities in the present. Economic complexity in this regard is often lacking, with the exception of primary economic regions and cities. Otherwise, local economies face a series of constraints which limit them to the most basic services levels. (High skills use thus far is mostly possible in areas with international monetary flows.) This has left most local economies dependent on adjacent regions, for both services access and wealth holdings (especially housing) that result from earlier income. With coordinated time use aggregates, a considerable amount of dependence could eventually be relieved.

What are the primary existing service obligations in any community? In the U.S. the first is most often public schooling. After that comes public safety (police, fire, emergency medical), then roads, sewer and water. By far, the biggest expense for these is operating and maintenance budget in the form of salaries. Whereas capital (what one thinks of as infrastructure) is in single digits. Much infrastructure expense in capital terms occurs very seldom, and has little assistance from state or federal levels.

How to think about monetary flows, in terms of what needs regular attention? Thus far in the U.S. public schooling has especially relied on property taxation, while other services (most often) utilize sales taxes. The good news in this regard? These ongoing expenses are salary related, and internalized compensation for local services generation would make much of the taxation to services transfer unnecessary - particularly for property taxation. Directly matched time as new wealth creation, makes a more complete services agenda possible. In other words, by turning time arbitrage into a starting point, a whole range of services formation becomes possible which otherwise could not be sustained in small communities.

What's more, the services-as-wealth process leaves resource windfalls available, for the materials most needed for infrastructure building and maintenance. That means windfalls become recognizable as the random benefit they actually are. Why is this important? Windfalls would not be grabbed for the constant needs of time use, nor would locals be regularly taxed for monetary flows they simply may not have in the present. Like so many other things in life, optimal income gains will remain random in nature, even when societies organize to make certain their members are economically included.

Resource windfalls - if truly appreciated - have the potential to create and maintain the economic paths best suited for those bearing responsibility for community.  Infrastructure options exists along a wide spectrum of possibility. That also translates into multiple density and work/living options. Some would require more investment than others and - as a result - represent more commitment and fixed resource use. It is probably a good idea to "sample" some areas with portable infrastructure and flexible time use commitments, to see if the proposed working and living environments prove viable.

Every community needs to generate ongoing monetary flows on the part of all its citizens. However, the present task is to find more efficient and considered ways of doing so. Too much emphasis has been placed on schooling for instance, with too little societal reward - or follow up plans - for the effort. Internal time use coordination among locals means not every home needs to be a resource intensive structure. Since fewer taxes would be necessary to generate needed infrastructure maintenance, considerable flexibility would be possible for work/life options.

Voting mechanisms for local citizens would take place in stages. Initial votes for new community would take place in a series of domestic summits, in order to match like minded individuals (and families) for common preferences in terms of infrastructure and desired community amenities. At the same time, a broad framework would be sketched out for initial commitments for services and production formation. After communities are formed, ongoing voting processes during the course of the year would calendar time use proposals for both services and production projects.

One goal would be to make certain that no individual becomes pigeonholed into certain activity sets just because of competitive advantage, or a perceived lack of skills elsewhere. Everyone lives a healthier life - whether relatively high or low skilled - when not required to perform a given task beyond a certain point of natural tolerance. So long as anyone seeks new work challenges, coordinated time use makes those challenges possible. The only reason society ended up with makers and takers is because of a lack of imagination. Fortunately, this arbitrary designation can be overcome.

Friday, November 21, 2014

The Vote, Reconsidered

The vote: It's a way for citizens to be included, which developed nations understandably promote beyond their own borders. A way to make one's voice heard and one's opinion count...or is it? Today, voting feels more like an egregious form of punishment or wishful thinking, than a tool for constructive action. One takes what they can get, I suppose. Still, one often hears, if you didn't vote, you don't have a right to complain. I've been to the voting booth enough times over the years to question that assertion.

Do voting processes need an overhaul? How to think about their present lack of effectiveness? There's confusion as to what one can vote for and reasonably expect in return, other than more laws which further detail what cannot be expected. Voting would be particularly useful, if - as a tool - it were utilized to increase odds of success in an aggregate sense. Instead, limits for resource potential are often imposed on entire aggregates, by the overly simplistic dictates of majority rule.

If the chances of direct democracy seem as though slipping away, the imprecise nature of voting has contributed to their decline. There are important aspects of time use and resource use which need to be managed - and voted for - at local levels. That's not to say that states would automatically do a better job in this regard. In the U.S., states are often inclined to follow the lead of national government regarding knowledge use limits, because special interests also provide monetary backing at state and local levels. As a result, too many decades of policy makers have backed special interests in their efforts to limit economic access. The fact they have been able to do so, makes many question the basic functions of representative democracy.

What's more, office holders have become dependent on the monies from factions which limit economic access, to fend off political opponents. For the most part, political representatives are cultural stand ins for the way citizens feel about the services provisions which remain. In other words it's just a fight over a now smaller pie of resource use options.

Special interests have always had the first hearing in Washington, it seems. But there was a time when the gains they brought to the table increased the welfare of the many, not the few. Often, earlier special interests brought technological gains to the table which benefited populations as a whole. The relationships these groups held with government was often the "least bad" circumstance by which to lay economic paths and frameworks for the whole. But the special interests of today, no longer provide a useful function in this regard. Their relationships with government are more likely to come at the expense of citizens, instead of to their benefit.

This is why so many citizens have real issues with government in the present. Governments provide a valuable role when they concentrate on improving societal means, instead of favoring societal ends. Unfortunately the ends have become far too lucrative, as office holders take their personal cuts in countless different ways. When governments say no further growth is possible, it is because they have lost interest in the continuation of means by which to move society forward. A primary example of this process is the infinite variety of tax shifting, which focuses on the ends of wealth rather than enabling means to create further wealth.

A recent Marginal Revolution post from Tyler Cowen about the middle class and infrastructure development, made me start thinking about the voting process. How was it that voting primarily became associated with public provisions, instead of the formation and maintenance of viable networks to keep economic pathways open? Indeed, the fact that voting became associated primarily with the former, seems to be responsible for the arbitrary divisions of "makers and takers" which exist today.

At any rate, much of the cultural "baggage" that gets thrown into the voting mix, revolves around public provisions as well. Perhaps if the public were more directly involved with means to maintain a free marketplace instead of clamoring for ends, much of that baggage could be left behind.

These are important considerations, before any serious discussion about infrastructure and structural change can even take place. What's more, some of the comments in the above linked Marginal Revolution post pointed to some basic elements about local economies which are often overlooked. In my next post I'll take a closer look at existing and potential infrastructure options.

Thursday, November 20, 2014

No More Innovation Or Growth Necessary...Seriously??

There are good reasons, why more people these days feel as though the odds are stacked against them. What's more, governments scarcely seem worth the tax dollars required for their upkeep, when they tell citizens it's time to give up on continued growth. Amazingly, this odd tactic has not been questioned to the degree one would expect. Perhaps some take comfort in "who needs growth, it's time to get back to a simpler life". Hmm...except what's "left" isn't exactly simple or reassuring. Meanwhile, others have a different story: "Innovation "isn't what it used to be. All the big, important stuff is already done."

How would anyone really know? I'm more inclined to think "innovation for me but not for thee". Did everyone wake up one morning and just decide: hey, this is as good a stopping place as any, for further progress? The person who is ready to kick back and put their feet up, is not the same person who is still hoping for a meaningful career - or life for that matter.

If no more innovation is "necessary" (except perhaps that latest chronic illness treatment or tech gizmo), how is present day production supposed to maintain the circumstance and populations of the present? Who would still commit to further education, if the job market does not improve? Is anyone really comfortable with the thought that humanity could easily "make do" without the use of three quarters of its mental capacity? I don't think so. Just the same, modern day versions of guilds control much of the ideas, research, new production definitions and process methods which are allowed to see the light of day.

Excessive regulations are cited as problematic. But how to dig through the quagmire, to determine where the worst problems exist? Structural circumstance needed to be faced squarely, before they get any more out of control than they already are. Sure, some money will continue to be spent on innovation if nothing gets changed: the kinds of innovation one hears about on the evening news. But much of what is heard in this regard, has little chance to benefit populations as a whole.

What about the innovation funded by governments? Many nations seem to be growing more reactive and defensive by the day, making it more likely that U.S. dollars for innovation will ultimately end up in defense related areas. Given the costs of research and development, private interests mostly want "sure thing" innovations. For pharmaceuticals, that means resources are geared primarily for ongoing needs of chronic illness, rather than acute illness and its related conditions. When research for medical needs was more broadly shared and dispersed, the latter was also well represented, particularly in alternative care.

Hence, if innovation for broad based societal gain remains likely in the near future, the possibility of making it happen rests with individuals, instead of present day public or private interests. Populations as a whole, need to restructure so that a wider and stronger net can be cast to capture innovation potential. Knowledge use systems are needed, which can be internally coordinated to support citizens in mutual time use pursuits. With ongoing calendaring for production and services proposals, costs for new forms of research and development could be internalized and greatly reduced.

Innovation networks are still strong, but much too thin and with too few connecting points, to really capture human potential. One could say that while the "long tail" applies online, it has few local economic equivalents thus far, in knowledge use terms. Unique services and production structures are mostly concentrated in cities, but this need not be the case. There is a world of knowledge and information which is just waiting to have relevance in local endeavor, and the digital realm needs to be put into motion so that populations can once again regain confidence for the future.

Wednesday, November 19, 2014

Midweek Market Monetarist Links and Summaries - 11/19/14

...but will the politics hold? (Lars Christensen) http://marketmonetarist.com/2014/11/15/italys-greater-depression-eerie-memories-of-the-1930s/
Behind each war, an economic cause: http://marketmonetarist.com/2014/11/15/mussolinis-great-monetary-policy-failure/
Depressions all, just a matter of degree: http://marketmonetarist.com/2014/11/16/great-greater-greatest-three-finnish-depressions/

Some monsters under the bed refuse to go away (Britmouse) http://uneconomical.wordpress.com/2014/11/14/whip-inflation-now/

Apparently...Pascal Salin had it coming!
(Scott Sumner) Please respond to our arguments
(Bill Woolsey) Pascal Salin's Confusion: Inflation or Money
(Bonnie Carr) Piling on poor Pascal Salin

And somehow, Neo-Fisherism has become the latest fad:
(David Glasner) This label would not please Fisher: John Cochrane explains Neo-Fisherism
(Nick Rowe) http://worthwhile.typepad.com/worthwhile_canadian_initi/2014/11/reverse-engineering-david-andolfattos-and-stephen-williamsons-neo-fisherian-paper.html
If the sign is wrong, the equilibrium is not robust (Nick Rowe): http://worthwhile.typepad.com/worthwhile_canadian_initi/2014/11/fragility-of-nash-equilibria-and-neo-fisherites.html
(Bill Woolsey)...how monetary policy ought to operate? Neo-Fisherites
(David Beckworth) http://macromarketmusings.blogspot.com/2014/11/another-look-at-neo-fisherism.html

John Cochrane...advocating deflation??
(Scott Sumner) Wrong question, wrong answer
(Marcus Nunes) Deflation Targeting at 2 percent
(Benjamin Cole) http://thefaintofheart.wordpress.com/2014/11/16/john-cochrane-defiantly-takes-on-economic-history/

"Interest rate rises do not stifle investment" (Scott Sumner) Other things equal, lower prices cause consumers to buy less of a good
Even with IOR, quantity of money cannot be ignored: Josh Hendrickson on the problem with "moneyless" NK models
How would fiscal stimulus in one country benefit a currency zone? The real "beggar-thy-neighbor" policy
Business cycles aren't what they used to be, or are some VATs worse than others? Is Japan in recession?
Everything shifts when RGDP growth stalls...The USA doesn't have any debatable recessions. That's about to change.
And, when RDGP is better than recent employment figures: At the other extreme...

Econlog posts from Scott Sumner:
Rather, the guy who insists money has been tight since 2008...I'm not "the NGDP guy"
Of course this rationale hasn't stopped some folk from trying! No, low interest rates do not call for more public investment
When governments respond to (lesser valued) credit on offer...Sticky wages and sticky fed funds rates

Friedman could have enlightened Malkiel (Marcus Nunes) http://thefaintofheart.wordpress.com/2014/11/12/what-if-friedman-were-alive/
And the Kocherlakota 2010 argument led to...http://thefaintofheart.wordpress.com/2014/11/12/the-bipolar-fed/
A job market comparable to 2004. Seriously?! http://thefaintofheart.wordpress.com/2014/11/13/bad-decisions-follow-from-bad-analogies/
Only recently was there real deviation from trend: http://thefaintofheart.wordpress.com/2014/11/13/playing-safe-and-absolving-the-fed/
"What made Temin change his mind?" http://thefaintofheart.wordpress.com/2014/11/14/keynes-returns-in-fact-he-should-be-sanctified/
In charts - NGDP, RGDP and inflation: http://thefaintofheart.wordpress.com/2014/11/18/the-unending-and-frustrated-search-for-inflation/

Musings on Hayek, Mises and surprisingly enough, internet Austrian "Major Freedom" (David Glasner) http://uneasymoney.com/2014/11/16/ludwig-von-mises-explains-and-solves-market-failure/

A vague target has been the primary problem (Bill Woolsey): Selgin on Keynes and Quantitative Easing
Fiscal policy intentions are also behind this dilemma: Monetary Policy and Fiscal Policy

Nick Rowe just needs a little help with the math! http://worthwhile.typepad.com/worthwhile_canadian_initi/2014/11/the-over-investment-and-under-saving-theory-of-the-zlb.html

Inflation targeting serves what purpose exactly?(Bonnie Carr) http://dajeeps.wordpress.com/2014/11/16/summarized-listing-the-perverse-incentives-and-deceptions-of-inflation-targeting/

The study of Buddhism can be a great help, re the concentration required for the skills of the mind (Ravi Varghese) http://insecurityanalyst.blogspot.com/2014/11/serenity-insight-and-investing.html

Will they be successful? (Justin Irving) http://economicsophisms.com/2014/11/18/augur-net-a-prediction-market-startup/

Also of interest:

"The long term unemployed also show much stronger attachment to the labor force than nonparticipants." Measuring Labor Market Slack: Are the Long-Term Unemployed Different?

How might economic aspects of this situation actually play out in the near future? Will government "come to the rescue"? The Problem With Millenials, In One Staggering Statistic

Tuesday, November 18, 2014

"Keep Reaching Out"

What happens to our connections with others as we get older? A recent series of posts from the blog "Sweet Talk", brings the issue of aging into sharp focus. David Duke, in two encounters with nonagenarians, comes away with several conclusions. His first post wraps up with one, of which I heartily agree:
Better in poverty to have friends than to have a house sunk with costs.
Regarding the suggestion to have "as many babies as possible": yes, a large brood can certainly help smooth those lonely moments, as one ages. My grandmother spent long hours in the kitchen preparing meals whenever she had company, and to this day I've had a compulsion to do the same. There's just one difference...I didn't have children. The inevitability of old age seems a lot closer these days. The last time I saw extended family, they were wondering how it was possible so many family members now live alone. What's more, why do so many economic options for my cooking "compulsion" - at least in a small town - exist mostly in "all or nothing" capacities? Hmm...

Even if I had "invested wisely" decades earlier (in term of the aforementioned "Sweet Talk" advice), today's spread out cultures mean few guarantees, when it comes to visits from children and grandchildren. As Ayya Khema stressed in "Being Nobody, Going Nowhere", people die or otherwise "go away" when we least expect them to, and even marry the "wrong" people! Ayya is scarcely alone, in her spiritual recommendation to let go of expectations in order to find peace and happiness. Nor is she alone, in stressing that no single relationship need be thought of as anyone's "lifeline".

Plus, a large brood only provides a partial portfolio of time use possibilities, as many grandparents well know. Even in the best of circumstance, what about the vast quantities of time that remain? And how many thousands of (housing) square feet "wait" for those annual or biannual visits? All the more a paradox, given the fact older baby boomers once crowded into (comparatively) tiny living and dining rooms on a regular basis, for family get togethers.

"Excess" time availability tends to be one of those things that creep up on individuals when they least expect it. For the better part of a lifetime, it seems as though most of one's time belongs to others and then suddenly, unexpectedly, time availability returns. Hardly anyone is really ready, when this happens. How can they be? Even the fortunate in this regard are going to need to rely on a lot more than family to spend days productively. What does this mean, then, in a broader sense?

For one thing, personal planning for those "Golden Years" only goes so far, even in the best of all possible worlds. One can "do" for others - "be there" for others - to the best of one's ability. But ultimately, that will not stop anyone from being alone in some important capacity. Many folk who live into their nineties (such as my Dad) have long since learned to be comfortable with this fact of life.

Was government somehow attempting to make "promises" for the elderly? If so, those promises were mostly in terms of healthcare, plus a little spare change for weekly consumption and local taxes. Was there a rationale that governments could "rescue" time use potential, or was this vital part of life never considered? When people of all ages lived and worked in the same spaces, no one needed to think about it. And while a return to such a state would be desirable, much about present life would need to change, first.

In the meantime, too much of a blank slate exists (sometimes decades), of which one's children realistically cannot be expected to fill. Indeed many elderly do not wish to be rescued by children or government, and they seek to do whatever is necessary to maintain their autonomy and self sufficiency. Just like the rest of us, older folk want to keep reaching out to others. But they quite understandably want to be able to do so on their own terms. Otherwise - just like the rest of us - they lose too much of their self respect.

What about organized religion as a "solution"? When it comes to social isolation, advancing age and chronic illness, organized religion certainly has a good track record. But visits from these kindhearted folk are as sporatic as any other. If not one's children, family, religion, government...

By now the reader probably knows where I'm going with this line of thought. I believe that the desire to maintain lifelong connections can best be filled through economic roles. Perhaps compensation for time spent helping others is not "economic", in the sense of normal businesses endeavor. Who the heck cares, that's not the point.

Rather, the point is there are moments when a little personal time with friendly "others" who don't tell us what to do or judge us in some way, beats just about any product one can buy. As much as family members love one another, "live and let live" can be difficult at times, when too much time is spent together under the same roof. Family expectations are quite understandable. However, the fact they exist is what keeps family relationships from having a true, voluntary economic basis.

Anyone who spends considerable time around older individuals (or those with chronic illness), knows these folk attempt to remain economically viable as long as possible. Then why not generate a real marketplace for the vast wealth of time use potential that exists? A marketplace which would allow every individual to keep reaching out, even after the point when a few might judge that it's not possible for some individuals to do so. Believe me, when there are places where one can go with good reason and not feel out of place - some of which one might even get "dressed up" for - that means quite a lot. Sometimes it's difficult to realize how meaningful economic choices really are, until they are lost.

Economics is well prepared to address isolation, because it can connect the dots in generating a marketplace of choice in time use. In old age as in any time of life, the more choices one has, the freer and stronger one can remain. Few individuals wish to remain dependent on others, in spite of what a lot of public rhetoric might insist. The marketplace can still allow people to reach out in the ways that matter to them most. While this is understood in terms of money, it is equally important in terms of time use value. It's time to make real economic pathways to help overcome the limitations of getting older.

Monday, November 17, 2014

Does "Perfect Competition" Hinder Growth?

It depends. Does competition exist in the form of complete product representation, or is "competition" more a component (such as knowledge or infrastructure links) which further enables the entire process? In a recent post ("Perfect Competition is Bad for Growth"), Dietz Vollrath, via the bullet points below, provided a fairly standard summary of the innovation which generates growth.

  • Growth is ultimately driven by innovation
  • People will innovate if they have incentives to innovate
  • The incentive to innovate comes from economic profit
  • Profits only exist when the innovator or firm has some market power

Because worldwide consumers often access tradable goods production, this form of competition has proven more beneficial (thus far) for consumers, than competition in non tradable goods. While Vollrath's first two points are general in nature, the last two factors became more important in the last century for growth potential.

Perhaps missing from the traditional growth economics perspective, is the spontaneous innovation which once occurred. Individuals enjoy both the challenges of innovation, and the sharing of those challenges with others. This natural inclination was only diminished by institutional claims to knowledge. Even though organizations are better positioned to utilize knowledge use, the costs of research and development thus far have been far more extensive than in the past. While spontaneous innovation often did not generate large profits, it provided the rich soil from which economies continue to grow in the present.

How to think, then, about the relative lack of innovation for developed nations in recent decades? While innovation still exists in some institutional capacities, that which is capable of scaling up for societal gain has been primarily in digital communications. What about the "imperfect" competition which stands in the way of innovation? From a commenter at The Growth Economics Blog:
So the issue isn't one of "perfect competition bad for innovation" as much as it is the rate at which market structure transforms from perfect to imperfect competition influences both the pace of innovation and the rate of diffusion.
The easiest way to think about this process is what has actually occurred at local levels, which has also stood in the way of substantial innovation for quite some time.  There is little diffusion of knowledge use in some economic environments, and scarcely any diffusion of innovative infrastructure or building component capacity in many environments. Even a recent post from left leaning Project Syndicate indicated the need for building and construction to be exposed to economies of scale.

Again, innovation in building components and infrastructure would be desirable for all income levels, not just individuals with lower incomes. Few other aspects of consumption would be as freeing, as this single factor. In a sense, it's odd that such an important scaling process should even be still be needed, in one of the most basic areas of our lives.

Perfect competition would not even be necessary, for the innovations which could free both our time use and services options in the future. How to make that possible? Who or what stands in the way? As mentioned in yesterday's post, the wealth of non innovated building structures also provide additional monetary flows for services formation. However, consider...If some recent statistics are taken seriously, one in thirty children experienced homelessness in 2013. How is that even possible?

As part of the product generation process, knowledge use has scarcely been given the chance to compete. While it's understandable that many institutions wish to limit knowledge use, this is no longer practical or realistically possible. Too many populations do not have access to the services they need. All individuals need the right to intellectual exploration, real challenges and meaningful work. All individuals need the right to assist one another for daily needs - credentials or no. Not only do governments need to recognize this, but private interests need to do so as well. Otherwise, a growing polarization in knowledge use and economic access will only become more difficult to reverse over time.

Fortunately, many aspects of knowledge use can take place without imposition on other existing knowledge use structures. Unlike the marketplace where too many copies of a tradable good would destroy profits, knowledge use adapts to specific geographic settings, and is also time dependent. Quite often, the result is a unique product: a result of local circumstance and resources.

Often, when competition is taken into account, it's too easy to focus on tradable goods instead of the altogether different circumstance of non tradable goods. As for the latter, neither competition or innovation have truly emerged. Of course, that really is the good news in terms of growth potential, because starting the process is equivalent to opening a whole new frontier. Should this happen, few would need to worry about perfect competition again, for the foreseeable future.

Sunday, November 16, 2014

Why Do Services Need to be Monetized?

Too many needed services are held back today because of supposed "austerity" circumstance, in spite of the fact that service formations represent great potential for economic growth. While some growth potential remains missing because of slowdowns in traditional production, gains in services formation would eventually expand the marketplace for manufactures and commodities formations as well. After all, it is difficult for citizens to fully participate in the marketplace when services access remains limited.

New services generation could be defined either as nontraditional or alternative production, should services be created so as not to generate further debt or societal obligation. In effect, these services would become a valid part of the supply side structure, in that they would not incur hidden societal obligations. Whereas traditional high value service formation often relies on proceeds from traditional production and international monetary flows, in order to take place.

As to the latter, the growth they generate is more interdependent, than would be necessary with nontraditional services production. While further growth would be a benefit of alternative services formation, services and production would not be "joined at the hip" in growth based terms. That would make it easier to accommodate supply side shocks as well - whether "good" or "bad" - because time use would become relatively more important than other resources which define environment.

How could services formation exist more independently of production? The fact that services become self supporting, would mean that production can move at different levels without completely upsetting transmission structures. The prime example in this regard are the ways in which assets are used to provide services flows. If asset structures are not completely bound to these roles, that in turn frees asset structures to more closely approximate what people want them to be.

The best part? Asset formation can in turn be readily subjected to highly productive (i.e. good deflation) innovations which would otherwise be held back both by special interests and services needs. If communities can generate services wealth directly, their infrastructure, asset and building component options immediately become more flexible. What's more, internally defined coordination patterns makes it far easier to accommodate higher population densities in a small core.

Consider the normal travails of declining production in recessionary times. In a larger sense, production aggregates should be increased because people find real gains in doing so, instead of being compelled to do so (i.e. maintain production) for needed services formations. By the same token: with fully developed time arbitrage, production levels could be relatively low (in given settings) without undue harm.

That would be possible, because of good deflation measures in currently existing assets and building formations for both living and working environments. Some individuals would choose to work less because lower cost living accommodations would not require a full work week. Or, they could opt for work which does not provide monetary compensation in a normal sense.

Presently, the entangled nature of traditional production and services, is part of the reason why governments struggle to make up for lost economic activity in recessionary periods. After all, governments are dependent on the proceeds of traditional production (which falters in recession) in order to generate the limited quantity of services which production aggregates provide. This also has bearing as to why a low interest rate doesn't imply government gains in borrowing for infrastructure provisions. Monetizing service formations - hence "setting them free" from production restraints, could assist governments in overcoming this fiscal recessionary quagmire.

Regular readers know that I use the term "monetized" in a specific sense: as compensation for local organized services formation and access, in coordinated time aggregates. Much of the austerity which limits work formations is arbitrary in nature, because of how services have been defined. What's more, some services are overemphasized because of legal and structural issues, even as service formation for the public as a whole continues to languish. Too much services access is also limited by hard credentialing* processes.

High skill knowledge use of the present is more often monetized (not backed by government redistribution), when it exists to serve middle to upper range incomes. Growth in this area became evident - for instance in the nineties - when legal offices emerged in central locations which were previously zoned for residential use. Commercial retail areas in that time frame were also increasingly replaced by tax preparation offices and the like. In more recent decades, what once would have been retail areas was instead given over to large freestanding structures for specialized medicine. However, these marketplaces cater more to a given portion of the income spectrum, than the marketplaces of the earlier twentieth century.

A lack of desirable or productive services formation is all the more problematic, given the fact that many with degrees also end up accepting work which exists below their skills capacity. Some of this, however, is due to higher education as an all too easy source of wealth capture. Again, the primary problem for education in the present has become its isolation from actual marketplace conditions. One result is a now inadequate services marketplace, for knowledge use engagement.

So long as many vital services exist mostly in a fiscal capacity, they will continue to be limited in relative terms. In a sense, one could think of fiscally provided services as existing in half the capacity that might otherwise be possible. Not only is their fiscal nature indirect in terms of job formation: it also involves a debt formation process which means the service is paid for not once, but at least twice. In some instances, perhaps half of the population is employed than might otherwise be possible.

Time arbitrage would not only monetize new services formations, it would make them possible in areas lacking in economic complexity. Furthermore, time arbitrage could alleviate the burden of sticky wages which contributes to unemployment. By compensating time use as anchored to local asset and production formation, citizens gain a better idea what compensation is actually possible. While these forms of employment are more self directed than traditional employment, the fact that locals support the inherent safety net structure is what provides work security, rather than job security. Much as individuals once tended gardens well after retirement, individuals would tend their local gardens of economic connections, well after more strenuous forms of work have been set aside.

The fact that production aggregates have been held back because of limits to marketplace access in general, is what makes it difficult to determine what a long term growth trajectory might actually consist of. Once populations achieve better balance in terms of asset formation and services structures, it will become easier to determine what future possibilities could be.

Monetizing services would also provide greater opportunities for returning time use aggregates to a central role in the economy. Not only would this be a tremendous plus for measurement in terms of a nominal level target, but it would also make economies more resistant to the dutch disease which can be problematic when nations become too reliant on commodities instead of individual input. Presently, many still view production as more important than individual participation, but any continued focus with this mindset only generates further economic imbalance in the long run.

I could easily continue, for the question posed by this post title is quite general in nature! Monetizing services could go a long way to establish normalcy, even though it would be a slow process which occurs mostly at the margins of primary equilibrium. Indeed, that is a good thing, because inevitable mistakes would be small scale. Plus local "victories" would present potential knowledge and land use patterns that populations might dare to undertake, if the risks of doing so are better understood.


*Hard credentialing is a major contributor to wage stickiness - hence a lack of overall work availability and knowledge dispersal in services formations. Soft credentialing would allow local populations to credential based on voluntary project and skills proposals, alongside ongoing negotiation for services needs.