Saturday, April 8, 2017

Knowledge Use and the Equilibrium Option

Populism is becoming a problem for many governments, as they struggle to maintain the coordination of vital knowledge application processes in the marketplace. Consequently, some believe the democratic nature of welfare states could become vulnerable to disruption. How to respond?

Communities that lack economic complexity, could create a unique, time coordinated equilibrium which would preserve both knowledge use and employment. Eventually, this process would help to relieve much of the pressure on today's welfare states. The equilibrium option would feature matched time value at its center, whereby new wealth would be generated from the locally cancelled debts of mutual time assistance obligations.

Each group starts with simple sets of time product categories. The internal educational structure - which borrows freely from a full range of possibility - means local time use options gradually gain a diverse range of skill and complexity. The structure identity of time based product is validated by provider and recipient: first after the initial match, and then the follow on match.

Once this match series is recorded by the community, new money enters the system to reflect the mutual purchase of time value. Even though this new money only represents the purchase of time as a commodity, the system provides support for social capital in a long term time based continuum. One could think of it as using monetary policy and personal initiative, to build a new form of welfare state.

As knowledge complexity grows within each community, groups would split off and form new groups, once they lack sufficient local space for the production/consumption coordination of locally desired skill and knowledge sets. Over time, the knowledge use patterns of individual groups would take on unique identities. Gradually, these communities would appear quite different from one another, as variation in the democratic "voting" process for coordinated time use is expressed somewhat differently in each group.

The knowledge complexity of this economic system, might eventually be greater than what presently exists in general equilibrium conditions. Some would find symmetric compensation too restrictive and migrate (with their skill sets) to general equilibrium. Others would find fewer constraints, due in part to the personal management of time preferences which symmetric compensation makes possible. Nevertheless, asymmetric compensation must adhere to the knowledge use patterns which can be accommodated via the revenue available for redistribution from primary market formation. The alternative equilibrium option overcomes the growth limits problem, by the alignment of its own unique form of primary market organizational capacity.

By making more wealth creation possible through new primary market formation, governments may finally be less inclined to close off their borders to others, as they become more confident in their ability to generate full employment alongside the productive use of knowledge for all citizens. It is especially important to provide new opportunities for wealth creation, since current efforts to limit general equilibrium access to "natives only" doesn't translate into meaningful knowledge use preservation.

In summary: consider why it matters to have equilibrium options. When economic time value only has a skill equivalent in the marketplace, the income results are so skewed that a democratic system becomes unwieldy for citizens whose economic time value is too varied for full participation. Democracy is further constricted in the U.S. because of the cross subsidy problem. No one can calculate the dollars which go to those who can't pay for time based product, versus the dollars which go to the ones who provide what is sought.

Indeed, voting processes can be difficult in any circumstance, as Arrow's impossibility theorem made clear. Yet nations would not have as much cause for concern, if they adopted economic systems which make room for the full utilization of aggregate time value. The limits of general equilibrium are a place where skills take precedence over time value, but this need not be the only equilibrium option for the nations of the future.

No comments:

Post a Comment