Knowledge use systems which begin at lower income equilibrium, would be accessible initially on a time use basis. Many could gain entry with little more than a portfolio of skills potential, which would be monetarily compensated when time use is matched with others. This compensation provides a "working base" which allows lower income levels to fully optimize their time choices. Time use accountability is often unnecessary or even impractical in middle to high income equilibrium, where income structures allow individuals to augment time use with the bounty of random resource wealth. True, time flexibility is not always an option for upper income levels, but this is due to both regional valuations and local consumer restrictions.
What then, would be "non porous" in local economies which adopt knowledge use systems? Coordination for both services and production processes would remain locally organized - hence decentralized from the broader economic environment. Local economies would make service potential and local investment opportunities for all citizens the first priority, and diversity of product options would be key to growth and stability. Investment in terms of organization and recording of activity remains local, so as to remain monetarily attached to time use as a base monetary component.
Why so "stingy" about local investment only? Otherwise it would not be possible to maintain an accurate and effective production norm, between services time use and related business activities. Without the incentive which ties together group innovations and personal rewards, the monetary link with time use would fall away - just as it already has in today's middle to upper income equilibrium. Fortunately, the time link is not necessary at upper income levels, because income capacity can substitute for aligned incentives and ongoing broad innovation.
Also, without the local investment designation, it would not be possible to take advantage of local factors in work and education integration, which can contribute to total factor productivity. The services to wealth norm that each local economy could generate over time, would sometimes determine how rigorous their tests might become for entry and local knowledge use capacity. Even though this implies exclusion to some degree, there would be countless variations of local services to wealth production norms to choose from. That really matters. For in the present, economic access continues to drift towards the high or low skill set options which a mid to upper income equilibrium can offer.
While locally generated knowledge can be freely offered to other communities with similar systems, there would be no direct competition with middle to upper level equilibrium, in consumer based terms. Before anyone partakes of these services offerings, they would need to be a part of a local economy and actively participating in skills arbitrage, for a given length of time until one understands and utilizes the system well.
In particular, a recent post about knowledge product, was able to get into some of the nuts and bolts as to how such an equilibrium might work in monetary terms. An equilibrium which directly accounts for time use, would rely on decentralized grassroots efforts. Otherwise, centralized efforts create problems caused by services that are filtered through taxation and government subsidies at multiple income levels. When ultimate responsibility shifts outside a system, so too the decisions as to how interpersonal relationships "must" take place.
It would be far more efficient, to allow direct monetary formation for knowledge use and skills set product at local levels. To be sure, knowledge use systems are not strategies for successful regions whose populations have good access to local services. Their populations benefit from the additional resource capacity of international markets, which makes it unnecessary to anchor consumption needs to specific forms of time use. However, time use systems could be a good option for regions and populations whose services, knowledge use potential and populations are woefully underrepresented.
These systems rely on incremental growth. This mean creating services and asset formations which - instead of requiring loans - become investment opportunities in one's own environment. Eventually, local investment strategies can also contribute to the monetary base which compensates time use. In other words: services as they evolve, also need to develop in ways that further compensate time use. Only consider what has happened to Cuba, as it emphasized skills sets as "adequate" for the general population for far too long. Unfortunately, the former wealth that Cuba once held, has continued to fall away.
Skills sets and diverse forms of wealth generation need each another, in order for both to flourish. But often the delicate balance which exists between the two, is not well understood. Cuba - for instance - is a polar opposite in skills valuation from the circumstance in the U.S. Here, many in the healthcare establishment have tremendous access to international and domestic wealth flows. Whereas, healthcare providers in Cuba are so impoverished, they do not even have access to the limited privatization and business formation which has been allowed for the elite.
Cuba also has a form of dual currency which has further impoverished its people. Little if any porosity exists, between time use skills sets and the limited business formations which the Castro regime have allowed to exist. If a dual equilibrium exists, in order to work effectively it must anchor time use to local economic capacity in both business and services formation. Otherwise, sustainability between one's time use and resource potential in the environment, will eventually break down.
Thus the two nations provide a dramatic contrast for compensated time value. Skills sets might either be "over rewarded" so as to destabilize business formation and economic balance, or else become a low value commodity such as has occurred, in Cuba. While skills time value is extremely low in Cuban healthcare, here is just a brief example of the opposite extreme in the U.S. from "The Innovator's Dilemma", HT Miles Kimball:
...if governments were forced to report on their financial statements the liabilities they face resulting from contractual commitments to provide healthcare for retired employees, nearly every city and town in the United States would be bankrupt. There is no way for them to pay for what they are obligated to pay, except by denying funding for schools, roads, and public safety, or by raising taxes to extreme levels."How can dual equilibrium frameworks overcome the compensatory skills set extremes which have occurred in Cuba and the U.S.? Both countries currently pose all or nothing scenarios in this regard. Neither the separation of skills sets from business activity in Cuban currency, or the single representation of skills sets in a middle to upper class equilibrium, are able to serve the needs of a population in any overall sense. Oddly, limitations imposed by U.S. government on skills sets, are somehow reminiscent of the limitations on business activity in Cuba. In both instances, the governments personally gain from the arbitrary limitation.
Previously I have suggested that skills utilization can take place without access to international monetary flows in regions which do not have adequate skills representation. However, in this post I particularly needed to stress that this process cannot occur in isolation from business activity. Otherwise, existing wealth and assets only deteriorate over time, because new wealth formations are needed to maintain those which came before.
This is why the recognition of time use as a finite component among other resources, is key. If the vast economic difference between finite time use and random resource use is not recognized, the good fortune of monetary windfalls cannot remain in place for infrastructure and maintenance needs when they are most urgent. Services, knowledge use and business formation all have important roles to fulfill in economic activity. But before they can work well together, the delicate balance which exists between them, needs to be acknowledged.
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