Nominal income also needs the active consideration of monetary policy, but some have been reluctant to acknowledge the roles of human capital and labor force participation, in the economy. Just the same, more substantial knowledge use and labor force participation are paramount, for continued growth. How could human capital be more closely associated with growth potential? Knowledge use, human capital and time aggregates need direct roles in wealth creation.
Knowledge use and high skill services in the marketplace are presently limited, in two distinct ways. First, human capital was initially defined as a secondary - or residual - component of product creation. In this setting of external knowledge use definition, production gains are also a result of less labor input, over time. Or: an alternate route to production gains through knowledge, has been through regimented or otherwise protected formats. Without a specific marketplace for time value, already existing knowledge sets have often been duplicated, instead of being adapted to specific circumstance. These knowledge use patterns have also been problematic, in that they attempt to place knowledge in categories with arbitrary value which does not readily transfer across disciplines.
There is also the problem of knowledge use limitation in the broader equilibrium sense of time coordination. Knowledge applications which are part and parcel of final product, either tend to be government backed, or in use primarily for higher income ranges. Both of these factors have created (what are now) natural limits for knowledge use in the marketplace. Private knowledge application settings experience limits due to a small high income population, whereas public knowledge application experiences limits from fiscal spending capacity.
In other words: because of the asymmetry uncertainty of coordinated skills residuals in the marketplace, it has been difficult to assign knowledge use a primary role in either wealth creation or growth potential. Externally defined knowledge applications had little choice but to rely on backing from preexisting sources of wealth and/or power. This is one of the main problems that endogenous knowledge use systems would seek to overcome. Presently, even though some fiscal backing remains for knowledge use, it comes with hidden government subsidies and other murky transmission features. In these circumstance, the growing attempt to control fiscal costs often ends up sacrificing the "good", along with the "bad".
Time arbitrage in knowledge use systems, would also offer product value which goes well beyond what individuals actually exchange in any given hour setting. The fact that comprehensive internal support structures could be realized without time debt residual, is why knowledge use systems would make a formal bid to be recognized as targeted new growth. It has not previously been possible for economic activity which also exists as compensated income, to generate newly created wealth - for multiple reasons.
Consider that externally defined wages which rely on government redistribution, mostly have additional product value in the sense of "charitable assistance" - a category which sometimes seems applicable to fiscal measures in general. What's more, fiscal activity of all kinds has an increasingly questionable role for long term growth, as populations already struggle with present tax levels. However, 1) fiscal activity in its present form, supports knowledge use structures which are often inaccessible for lower income levels in terms of production and consumption, and 2) fiscal activity - even in the best of circumstance - does not necessarily provide the services which populations believe are still available...until they need to seek them out.
Knowledge use systems can provide more comprehensive services formation where both profit and non profit activity have failed to do so, for additional aggregate supply capacity. The social contract of coordinated local support, would provide backing for both individual and group endeavor, as well as broader representation for knowledge use. Time arbitrage would provide reliable backing for asset structure, and recorded local history for the changing circumstance of interdisciplinary knowledge use.
As a social safety net which reduces overall risks in a long range capacity for individuals and groups, knowledge use systems could provide services organization more effectively than governments. Time aggregates and individual purpose are better aligned, and the safety net factor is paramount. It means that through consideration for others and concerted effort, people of all ages would remain part of the ongoing economic activity of their community, so long as they live. Even though investments can ultimately provide leisure for some, others would continue to tap active time use value for their obligations.
Another product component of knowledge use systems is that of planned redundancy, which operates as a knowledge use backup system for the regions at the forefront of economic activity. This would make knowledge use systems valuable to nations as a security benefit. Not only would they provide "second opinions" and alternative responses, they would become a repository of knowledge wealth which other institutions cannot always support.
Best, the growth of knowledge use would no longer be dependent on commodity wealth, traditional production or other existing financial structures. Long story short, human capital could assume its rightful place at the forefront of the wealth creation process. Knowledge use can become an originator of aggregate supply, not just a burden on aggregate demand. Ultimately, the process would provide a stronger role for monetary offset than has been the case thus far - particularly in a time of diminished fiscal contribution to monetary policy.
Human capital would thrive, given a primary role in economic activity. Until now, time based compensation in relation to other resource potential has suffered neglect - given its existence in a secondary capacity. So long as production continued to rapidly expand, the secondary role of knowledge use was understandable. But once nations became dependent on consumption and aggregate demand for further wealth creation, that was a signal to take a closer look at the obstructions of aggregate supply which can affect economic systems in their entirety. Fortunately, there are means to begin the process of normalizing aggregate supply, through additional knowledge use capacity.