Tuesday, March 31, 2015

Generating New "Fast Flows"

A recent blog post from Shane Parrish re improving one's luck, reminded me how important it can be, to remain near "fast flows" where productive endeavor is readily found. He writes:
...The idea here is to be where things are happening and surround yourself with a lot of people and interaction. The theory here being that if you're a hermit, nothing will ever happen.
Yes...but...what if everyone cannot relocate near the downtowns which - among other things - exist as experiential goods? Some sleepy environs are finally left behind, while others remain in various stages of economic limbo as "affordable living".

In contrast, successful cities and regions include dense networks of social coordination - particularly services of all kinds. Much of which can serve as fallback positions, should personal endeavor fail for any reason. New social media for economic activity relies on this already existing network as well, and mostly adds additional options to already prosperous areas. This fortuitous network means it is easier to create economic value for one's personal time, than it would be where economic activity has been "hollowed out".

However, all of that spontaneous coordination has evolved from long term systems, and it comes at a price. Plenty of luck is involved, just to maintain the resource commitment levels which are expected in a given local equilibrium. Should the gamble prove a bit excessive for some, this serves as a reminder that there are not enough dynamic regions for all potential comers. Might it be possible for groups to generate greater "luck" potential, than has been possible for individuals to generate on their own?

More "fast flow" regions are needed, to generate the broad social cooperation which increases everyone's odds and fallback positions. How to think about new starting points for wealth creation and complex local economies? The good news is that the process can begin with knowledge use systems, as a central point from which other forms of production and asset creation can gradually emerge.

Purposely coordinated time use at local levels, would allow knowledge based services to provide a stronger and broader growth trajectory. Time value would of course continue to be reimbursed more asymmetrically in today's prosperous areas, than in other regions. Just the same, government and business budgets alike would finally gain relief, from pressures to provide services for those who (till now) haven't been able to reciprocate.

Knowledge use systems at local levels could serve as new points of wealth origination. What's more, they would provide means to encourage the "elephant" process which Dietz Vollrath referred to in a post about sustained growth capacity. One positive aspect is that the responsibility of family would once again become shared with local community. While community responsibility appears as though a reality in today's schools, the process gets completely cut off upon high school graduation. Unfortunately, students have little means to apply the education of their youth to the economic vitality of their own communities, afterward. In "Did we evolve the capacity for sustained growh?", Dietz sums up:
Suggesting that poor countries need to get their genetic mix right in order to grow is like suggesting they need to adopt steam engines and telegraphs before they can step up to gas engines and mobile phones. The question of how to catch up to the frontier is an entirely different question than explaining how we got a frontier in the first place.
Expecting individuals to go through today's hurdles of educational barriers and other costs of economic access before they can even get a job, is reminiscent of the expectations now placed on poor countries. It's not about catching up to the frontier, but accessing the frontier of knowledge wealth at the level it already suggests to populations as a whole.

One reason that growth potential is difficult to understand, is that rural areas of developed nations face many of the same catch up issues as anyone else. It's not that anyone wants or needs to take away rural beauty for that matter. Rather, that the wealth of the present needs to be envisioned in the virtual reality which structures of all kinds now suggest.

Economic vitality needs to be more closely associated with environments which are not so much about elegant and extravagant buildings, but instead the mind's curiosity. It's great to visit elegant buildings but no one needs to have them every day of the week. Whereas premium knowledge use is needed every day. Personal challenge can provide measurable value, just as surely as any wealth the world has to offer.

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