Experiential Product as a Structural Component

A marketplace for time value, would make it possible to generate experiential product which need not rely on (asymmetric) prior revenue or disposable income, in order to take place. Eventually, as more groups participate in symmetric compensation to generate time based service product, more economic output - hence a higher growth trajectory than is presently the case - could also result.

More economic output is important, if present day economic stagnation is to be overcome. However, people are confusing wage increases (on the part of some) with increased output overall, which unfortunately is not the case. Wage gains in aggregate, result from an increased degree of economic activity and circulation of marketplace product. By the same token, any increase in the growth trajectory of nominal income and spending also reflect increased output. Yet the ability to generate additional marketplace capacity has proven difficult of late, since doing so requires defining product along broader lines than governments and private interests alike, have been able to do.

At least for purposes of this post (as a glossary term), think of experiential product as non routine focused attention, intended for assistance in the circumstance and environments of others. Non routine focused attention is vitally important for the economic lives of all individuals, and not to be taken for granted from anyone in one's personal life, otherwise. Each individual's attempt to improve resource utilization and decision making, varies to some extent from the general knowledge sets that society expects to assist those processes. In spite of online assistance in multiple areas of life, confirmation or additional reference points on the part of others, can make a crucial difference in one's ultimate approach.

While I emphasize individual to individual activity as an appropriate starting point for economic gain, some forms of individual and group created experiential product don't need to be expressed on economic terms. Why so? Many spontaneously formed social activities would not benefit (economically) from compensated time value, especially if they are sought primarily as entertainment.

Indeed, the experiential product of entertainment which contains economic value, is that which is prepared for sale by individuals or groups for others as separately existing packages from individual time value. However, experiential time value as spent in entertainment with others (or in personal challenge) is not necessarily linked to group based mutual assistance, because many forms of human activity represent what individuals choose to do in any instance. In particular, activity which is family or otherwise tribal oriented, also tends to be less economically oriented. Think of informal local sporting events for instance, and personal preferences for home based activity which come closer to personal hobbies, than clearly existing family needs.

Such preferences are important to delineate, because compensating already existing time based preferences would remove the impetus for more productive forms of economic activity which encourage individuals to seek out strangers (i.e. more participants) to meet real service based needs. The more willing participants are involved, the less coercion is involved on anyone's part, for any single time based activity.

The whole purpose of envisioning experiential product as a structural economic component, is to bring people together who otherwise don't have sufficient social constructs in place, to be able to imagine doing so. Higher income levels understandably don't recognize what's missing in this regard for lower income levels, because time based services are such a part of daily life for the prior group. Even though lower income levels have a minimal degree of time based health and educational services at their disposal, it is not possible for society to apportion these effectively through asymmetric means. Hence education and healthcare provide an essential starting point, for experiential product in knowledge use systems.

Knowledge use systems would insure that people who otherwise remain socially and economically isolated, have a precise coordination platform which is not open ended (such as LinkedIn) for work potential, but generated to structure work within a defined group on a regular basis, in an ongoing time continuum. Put simply: through a reasonable structure which allows people to call on one another to sort life's confusions and aggravations, personal freedom and autonomy once again become possible.

How to think about experiential product in relation to the ways it has previously been discussed? Some readers may notice some dissimilarity to Wikipedia entries, so I'll look at a few contrasts. For experience good, I found:

...an experience good is a product or service where product characteristics such as quality or price are difficult to observe in advance, but these qualities can be ascertained upon consumption.

Experience good as defined by Wikipedia, appeared to be the closest description to defined real time product that was available. This article also stressed the difficulties posed for consumption choices, which in turn leads to lower price elasticity. Another subjective product is referred to as the "experience economy", which may also be thought of as business creating (memorable) customer events. Many knowledge use systems would gain opportunities to pursue this form of product, once they are well established. The prime experiential product I noted was a reference to movies, videos and other mass produced product as generated through time value, prior to sale.

What appears missing from the immediately available online interpretations, is subjective product with a focus on individual assistance. Also - as noted early in this post - contrast non routine personal attention, with the attention required for routine activity or objective service outcomes.

Of course, many time based activities that include specific or standard outcome, are those that are subject to automation - particularly in prosperous regions which include complex economic settings. Presently, individuals are being encouraged to seek work opportunities of a non routine nature, for long term job safety. Even though non routine work is somewhat of a safer bet, asymmetric compensation will continue to face limits due to budget revenue and lack of discretionary income. Hence a symmetric approach could prevent needless unemployment, and allow human capital a more central role as a time based consumption good.

Another way that time based experiential product differs from separately existing product, is the "passive" role of the consumer, in the latter. One of the prime benefits of time based experiential product, is the opportunity it provides for the consumer to take an active role, which translates into a flow of mutual interaction. The blogging format - much as other online formats - can provide an interesting partial time shift, in that some interaction between provider and participant is still possible. Indeed, asymmetric compensation tends to only allow a partial degree of mutual interaction in aggregate, between professionals and consumers.

Even though some knowledge use systems would eventually seek to engage in group based research and development, peer to peer assistance needs to be fully utilized and understood, first. Otherwise, differences in aptitude make it too tempting to divide work patterns in ways which eventually devolve into layers of administration, such as what now exist. By fully integrating peer to peer assistance, automation choices and unemployment would no longer be perceived as threats. Further, the maintenance of a non hierarchical group format, makes symmetric compensation and organization a feasible long term goal.

Economies Would Benefit From an Equilibrium Approach

Economic access is not simply a matter of "too much" or "too little" income or taxation. "Too much" or "too little" in relation to what, exactly? The interconnected nature of general equilibrium conditions, means any attempts to remedy specific parts will affect the whole to some degree. Hence general equilibrium problems would benefit from public dialogue which transcends the ongoing battles of relative wages, income and taxation.

When policy makers approach problems from partial equilibrium framing, often the result is greater equilibrium imbalance. An apt example for equilibrium perspective, is the recurring battles over gun control. Instead of imposing yet more rules and laws yet again, why not work together to redress equilibrium imbalance? Doing so, would ultimately mean that people have fewer incentives for using guns on one another in the first place.

General equilibrium settings can be envisioned as shared marketplace capacity, between tradable and non tradable sectors. The complex effects these sectors have on one another in terms of growth capacity, are not yet well understood. This is all the more problematic, given high level government involvement in non tradable sector activity. Even though government "crowds out" private sector activity, too much of this process occurs with the implicit "blessing" of the private sector - in spite of protestations that circumstance are otherwise.

Sometimes, government crowding out almost seems beside the point, as time based product is called into question because it is not generated through viable and sustainable means. Here, knowledge applications are questioned, because of the fact they take place on terms that are simply too open ended, in terms of shared resource capacity. In other instances, the wrong parties are continuously blamed for supply side deficiencies, in what have been deemed crucial areas for applied time based activity. It does not seem plausible, that the marginalized get the blame for seeking access to the forms of time based production which they have not been deemed capable of providing on their own.

How does a lack of equilibrium balance contribute to so many problems? Tradable sectors developed their share of wages and income in relation to actual resource capacity, i.e. that of currently existing revenue and capital. This setting also actively contributed to ongoing product formation and marketplace expansion. A balanced equilibrium would imply that non tradable sectors take a similar approach, but alas this was not the case. Rather, today's non tradable sector activity is a completely open ended structure, which also has not proven capable of gauging aggregate resource capacity in real market terms.

Non tradable sectors estimated the aggregates of wage and income, based largely on whether or not political factions were in their favor. As a result, this open ended structure - which did not lead to direct (i.e. time or resource backed) wealth creation - meant permanent dependence on tradable sector wealth, in aggregate. Had existing resource capacity for national tradable sector activity been taken into account (also in relation to similar international tradable sector activity), non tradable sectors would not face the current wage/income impasse which now contributes to worldwide productivity losses. As a result, hiring is either partially curtailed or continued at lower levels of compensation.

Just the same, non tradable sector formation is likely somewhere beyond the early stages of crowding out tradable sector marketplace capacity. Should this crowding out process be left unchecked with no marketplace alternative, central bankers may incrementally decrease the level of aggregate spending capacity which represents both sectors.

A recent post from Marcus Nunes, shows how this process has already been occurring for some time. There's a way to think about the gradual shift downwards, which puts additional pressure on both nominal and real growth levels. How so? In some time periods, non tradable sectors will claim a relative greater share of total resource capacity than tradable sectors. Their relative inflation, as contrast with the good deflation of tradable sectors, also decreases the tradable sector representation for that period, when a hard inflation cap is in place. Since this adjustment draws down total existing resource capacity from which non tradable sectors derive their revenue, inflation caps gradually draw aggregate spending capacity downward.

Is it possible to set non tradable sectors on more sustainable paths, which do not continue to draw down resource capacity for both tradable sector activity and combined activity overall? One reason for today's political gridlock, is the fact it's difficult to fight the multiple battles of equilibrium imbalance within the structure itself. UBI can be thought of as such an attempt to fight a problem at general equilibrium level, from within. In a recent post, Scott Sumner noted the lack of political feasibility for UBI, because of the political issues involved. How does one willingly "step away" from government promises such as Social Security and Medicare for instance, if there are not viable long term options to reduce risk?

Much as inflation targeting represents an arbitrary cut off point on the part of central bankers, governments also become inclined to throw up their hands and institute arbitrary cut off points such as UBI when general equilibrium issues have gone unaddressed for too long. Rather than everyone having to face arbitrarily cuts for entitlements in the near future, why not provide the choice of an alternative equilibrium approach in the present?

Today's government promises are risky, but the only thing more risky is relying on private enterprise which does not yet have a built in continuum option for previously applied time value. The best way to deal with risk in a manner that approaches a government promise, is to build an internal time continuum which links time based wages to asset and service formation. It's an approach which still leaves the participant free to gamble their resource/income equivalency if they wish, but in which one's time/wage equivalency can maintain the protection of both individuals and the participating group.

Alternative equilibrium is an equilibrium response which need not jeopardize existing equilibrium structure. No one set of economic rules should have to suffice for multiple differences in lifestyle preference and wage/income potential. Democracies only fall into disrepute when opposing tribes attempt to impose their beliefs on one another, as if there were no other choice but to do so.

Services Product in Global and Local Context

When it comes to services product, context matters. This is true not just in terms of how skills, time value and knowledge interact, but also in terms of macroeconomic and employment outcomes. Hence those who attempt to quantify or classify services product in the future, could consider skills product in various contexts, since these categories differ in important ways.

As governments seek relief for long term budget obligations (with universal basic income as the latest "opt-out of the welfare state" wish), it becomes more important to understand the nature of services product that citizens expect - particularly in connection with present day entitlements. Presently, most citizens attempt to access the same forms of high skill services product which organized in response to global discretionary income. This, despite the fact some wage levels were too low, to support the resource capacity required for general equilibrium service formation.

To supplement the revenue that nations dedicate for skills arbitrage, some professionals are adapting with knowledge product which is aimed at a global marketplace. Unless actual travel is involved to access time based (high skill) product, global services product can shift away from present (perishable) time value to prioritize specific forms of knowledge and skills capacity.

Whereas local services product will hopefully continue to have the option of prioritizing time value in knowledge use settings. Not only is it important to maintain time value in an era of increased automation, local services product does not require the highest skill and knowledge levels in all instances of product access. This relative skill to time use context is hardly a negative, since many consumers value the personal time component of service product, just as highly as any knowledge or skill that may be on offer in the package. In particular, time value for services product is all the more important when education is sought as personal challenge; or for healthcare, where knowledge and skill come up short in providing answers for health outcomes.

The global search for specific knowledge and skill, contrasts starkly with knowledge and skill as it is frequently applied at local levels. In many instances, local consumers have little ability to negotiate for the service product they might prefer - whether it be simple or complex. This is especially true, when government provision of services means budget oriented "default" settings, in which limited sets of knowledge and skill options are applied with a broad brush.

These default settings are an unacknowledged problems in today's welfare systems. They also result from a lack of interest on the part of private parties, to broaden overall marketplace representation. There is too little cooperation and competition, for the kinds of services product which consumers find increasingly important.

Oddly, time based services are still viewed as economically unproductive, since their present formation means a need to siphon resources from other existing forms of wealth. Yet who could have imagined a world which would ultimately move towards automation for tradable goods, only to lose understanding, how best to approach non tradable sector activity in the 21st century?

What's more, money has become such an important part of daily life, that personal assistance on voluntary (non monetary) terms has continued to decline. Even the time banks of more prosperous regions, suffer from the fact many members seek asymmetrically compensated services product, which is too limited by design, to substitute for symmetrically coordinated time value. Today's marketplace has yet to structure for time value as local group priority. As a result, many individuals perform countless service tasks for themselves, much as they once had to build their own crude products centuries earlier with little societal coordination. And yet this self-imposed frugality - desirable though it may appear - scarcely translates into societal gain.

In recent centuries, asymmetric compensation (originating from disposable income and existing revenue) for time based services became more extensive, as tradable sectors continued to expand. Unfortunately, the recent worldwide slowdown in growth, puts asymmetric compensation for high level knowledge and skill in jeopardy, to some degree. When William Baumol indicated the relative lack of services productivity (in contrast with tradable sectors), he echoed Adam Smith in "The Wealth of Nations". Adam Smith referred to the revenue required for public servant and menial servant alike as "unproductive", since individuals being paid solely for the value of their time, weren't perceived as capable of contributing directly to wealth formation.

Nonetheless: since Smith wrote, there's been a growing number of instances when purveyors of time based services have found means to "pay their own way", or create services associated product. It was only with the broad expansion of published print, that more individuals associated with "unproductive" labor, gained the option of generating product value which existed separately of their time. Further - in recent decades - this services transformation has been amplified by the digital realm. Timothy Taylor writes of the services product that has now become international in scope and - somewhat unnoticed - even contributes to a trade surplus:

The US has been running a trade surplus in services for the last few decades and its getting larger...I wonder how many of those who think that trade deficits are a result of unfair trade practices by other countries are willing to stick to the logic of their position when it comes to US trade surpluses in services.

Many of the digital services Taylor highlights, are also of an ongoing nature. Before the use of computers became ubiquitous, an international sharing of knowledge and skill sets was already beginning to take place. However, it was more closely oriented toward start up efforts in developing nations, for expanding tradable goods production. In other words, those additional expenses for personal transport and the actual element of time value, were deemed worthwhile since they were necessary for the start up process. In the present, the lower costs made possible through digital transaction, make services product a part of ongoing international communication as well.

However, there can be downsides to "paying one's way" as a knowledge and skill provider in this capacity. When knowledge as product is sold separately from time value, there is danger that the knowledge in question is forced into competition with other knowledge which may also have useful applications. Once economies begin to stagnate, populations become more inclined to insist that some knowledge is useful, while other forms of knowledge are consequently deemed useless or unnecessary. Sometimes, knowledge can be withheld and even lost from the marketplace. This unfortunate circumstance contributes to my rationale, to create a marketplace for time value. Time arbitrage - for everything from the mundane to research and development - could eventually make knowledge use less dependent on gaining support from disposable income or revenue.

This is already an overlong post, hence I did not have the chance to delve into the post which inspired me to write it, before coming across Timothy Taylor's discussion regarding international service formation. Recently, Dietrich Vollrath asked, "Is productivity the victim of its own success?" His post is definitely worth perusing, for those readers who have time. I was particularly happy that Vollrath noted the importance of time value in services product, and how that component might potentially affect a given growth trajectory.

Economics "Rescue"? More Pragmatism Needed

In a recent post at Bloomberg, Noah Smith expressed hope that academia, i.e. the "ivory tower", would gain a more relevant economic role in the near future. For Noah, the DSGE model is part of the problem. He summarizes the article with these thoughts:

When we understand the pieces of the economy better, we'll have a much better chance of grasping the whole. If this continues, maybe the ivory tower will have more relevance for the Fed, the financial industry and maybe even for our coffee house discussion.

Brad Delong enthusiastically backed Noah on the irrelevance of the DSGE model, while in response to the overall exchange, David Andolfatto explains for his students why he continues to find the model useful. Meanwhile, Narayana Kocherlakota took the discussion a step further:

Academic macroeconomics is specifically designed to be of limited use to policymakers like the FOMC.

Should Kocherlakota's statement be considered accurate: given the importance of the FOMC, since the Fed largely consists of academia, there seems to be quite a communication problem! Regular readers already know how I feel about the matter, which is summed up by this post title. Much of the problem stems from ideas about resource patterns that developed when human capital (in aggregate) seemed less important than other forms of capital. As a result, twentieth century economics was predicated on the assumption that individual economic actors weren't really all that important - either in a monetary or fiscal framework. Likewise, the importance of money's role was also downplayed in the twentieth century economic model.

One could say that the first rule of economic pragmatism should be to faithfully represent the aggregate spending capacity, of a nation's level growth trajectory. Commitment to a level nominal target, can also be thought of as the commitments which economic participants have already assumed for one another in the marketplace. When central bankers refuse to provide this basic level of monetary representation, productive capacity is all too easily lost. The only difference between today's ongoing loss of productive capacity - versus that of the Great Recession - is the fact supply side capacity continues to dwindle at a less obvious pace.

Also, one of the most concerning issues since the Great Recession, is that policy makers have yet to realize the importance of sustained labor force participation, as important for long term economic viability. Even so, the particulars of labor force participation are important for central bankers insofar as the latter provides accurate monetary representation, instead of being distracted by the needs of government and credit driven institutions.

The hard work of production reform, is not the responsibility of central bankers. Unfortunately, too many business interests have refused to acknowledge their role in ensuring broad marketplace participation and economic access for all concerned. When both public and private interests gradually hire fewer workers over time, the lack of economic participation means problems for the shared responsibilities of infrastructure, as well.

No new economic models would provide useful application, if they don't acknowledge the reality of the conditions which have gradually led to economic, hence social and political gridlock. All political parties now have limited options, due to the way that state and national budgets have been affected by countless earlier decisions - particularly those of "kicking the can down the road". Should political factions be unwilling to squarely face what has actually occurred, economic conditions will gradually decline, regardless of who is in power. For a long time, academic discourse happily remained beyond the political fray. Now, in order to remain relevant, academic discourse will need to dig deeper, to provide assistance in what has become a political, social and economic impasse.

Economic potential for the 21st century, resides in human capital. But governments cannot fulfill the roles of human capital which need to take place at local levels in the context of time based product. Meanwhile, governments have little choice but to short the human capital investment which has already occurred, in order to meet their budget requirements. How will policy makers respond to the growing gaps in marketplace representation that are already taking place? For instance: neither the public or private interests which negotiated Obamacare, were willing to acknowledge the need for human capital and time based product in terms of a truly free marketplace.

These knowledge and service based roles are precisely the ones which governments and special interests seek to control. However, it is this lack of willingness to allow true freedom for services provision and time based product, that makes long term austerity such a threat for many nations. The realities of supply side factors are important for any economic model, since growth and continued prosperity is not possible if they are ignored. The coffee house discussion which Noah Smith spoke of, also contributes to public understanding to some degree. But it is the other private and public interests he discussed which need a better understanding among themselves, if future economic models are to really matter.

New Corporate Structure: Some Wage and Income Concerns

Wages are more closely associated with local capacity for hourly compensation, while income takes into account resource capacity beyond personal input. Wages and income for tradable goods are today's primary role, for the wealth formation most capable of expansion. Tradable sector income represents easy to quantify product formation and long term growth potential. Whereas, the secondary income role (i.e. non tradable sector income in general equilibrium), more closely reflects a nation's relative role or international positioning, in terms of time value formation.

Knowledge use systems would provide more room, for non tradable sector formation that need not be dependent on the resource capture of political roles. These systems would transform local coordination for services into a new source of wealth, via time value as commodity. Through the assignation of time value as commodity, individuals would be able to assume a direct and primary role in wealth creation, for the first time. This process could allow time value to overcome many of its limitations as a non tradable factor in economic activity. As a quantifiable commodity, time value becomes capable of assuming growth potential in the same sense as tradable sector wealth.

The new corporate structure this process would entail, delineates wage and income differential through a distinct process of separation. Such distinctions - embedded in local education - could allow participants to gain a better understanding of their own relationship with resource potential.

An ability to ascertain differences between wages and income is important - not just in terms of personal responsibility, but also as means to determine connectivity between local economic conditions and those of surrounding economies. Ultimately, local separation of wage and income in terms of economic activity, could also make it easier for citizens to understand factors which contribute to representation for nominal income.

How would knowledge use systems delineate the crucial differences between wages and income that matter most? By protecting time value - via wage to asset formation - from some of the liquidation risks that can destroy the impact of small wage potential. Wage compensation would gain protection that is not otherwise possible in general equilibrium. Such protection could do far more good, than what are often ongoing attempts at finance reform, in general equilibrium conditions.

Of course, even in this form of corporate structure, some "dangers" for low income levels would continue to exist. However, these dangers would mostly be associated with the additional income that citizens are able to accrue - much as local discretionary income would also remain exposed to the normal taxation of one's state and nation. Protection of wages is made possible, by the fact that wages are tied to internally coordinated time value, which accrues to internal asset formation from a young age.

Wages as a basic commodity foundation, would receive protection for all local citizens by building time value as the central component of local asset structure. The service based wage to asset link is what makes the standard form of loan processes unnecessary, since housing, local ownership and other building formation accrue through time value.

This service wage to asset link, also makes unnecessary the fiscal transmission processes that are necessary for government in general equilibrium conditions. However - if so desired - participants would still have the option of generating local finance through discretionary income which is not connected to the local form of monetary transmission that takes place. In other words, discretionary income as savings for local loan formation potential, would be connected to surrounding economic circumstances through non local resource and asset related means.

Doing so would give these citizens the option to create the kinds of small loans for local business formation and related personal need, which today's large banks no longer have incentive to provide. Even though such loan structures might require equity in order to take place, such equity would be income based on the part of participants, rather than the wage equity which accrues within the system through one's personal time value.

Some Thoughts on Equality of Opportunity

Do people argue for equality of opportunity, as opposed to equality of outcome, in "bad faith"? Why would anyone do so? There's no need for me to single out the specific arguments against equality of opportunity as a legitimate concept, which I recently spotted. And after a strong response from a commenter on a post regarding neoliberalism, I'm concerned about coming across as antagonistic, which is not my intent. Suffice to say, I was taken aback, once I realized there are bloggers - and others - who have a strong aversion to "equality of opportunity" as a legitimate argument.

Much as the reality of rich and poor, equality of opportunity is a relative state which still deserves acknowledgement and action. The right to produce goods and services for the public - for example - is a dramatic example of equality of opportunity. Why not strive to make certain that opportunities aren't lost, instead of losing further ground by reasoning they don't exist in the first place? Better odds of success are possible for all concerned, when inequality is approached with the intent of improving economic access.

In other words, plan for opportunity in terms of resource use and access, instead of seeking greater equality through increased redistribution of outcome. This initial or prior approach increases outcome potential and long term growth, whereas an outcome based approach only encourages further divisions over already existing resources. In particular, specific supply side methodology for increased non tradable sector production and consumption, would contribute to long term growth. When most marketplace capacity is defined so as to exclude low income levels from production and consumption, it's understandable that equality of opportunity may not ring true.

Another important consideration for equality of opportunity, is to consider how time and skill contribute to efforts and economic outcomes. Even though it is not widely recognized yet, new horizons are opening for personal time value in terms of production and consumption, which didn't exist before the technological gains of the present. Equality of opportunity is inherent in the process, due to the use of equal time value as a starting point for service product coordination.

Time value has an important role in its own right, as a function of mutual coordination capacity, while skills capacity responds best to resource application. When individuals are responsible for their own time management and resource decision making processes, time value and skills capacity are not limited to a single role, in terms of the wealth that accrues to both individuals and groups. Both organizational capacity, and the alignment of skills potential with resource capacity contribute to economic outcome.

The separate functions of time value and skills capacity in the workplace, are sometimes missed. This is understandable, given the fact that 20th century employment by others often meant applying time and skill along a single path of resource application. In some respects, the employment model which combines personal skill and time value in a single output trajectory, is outdated. Yet it has proven difficult to move past a mindset in which personal time and skill - in relation to specific resource sets - is mostly determined by one's employer.

Generally, when individuals are self employed in some capacity, time and skill options can also be applied along different paths to achieve greater outcome potential. Time arbitrage would assist this time management process, given the fact individuals in groups would hold both entrepreneurial and mutual employment roles. Sometimes the paths of time and skill use would merge, whereas in other instances they would become quite distinct, in terms of output potential and quantification.

Personal skill in relation to resource capacity, particularly defines the output potential of tradable sector activity. Indeed: much of what is now considered "uneven" in terms of economic opportunity, originated when compensation increasingly took into account the degree which one's unique skills capacity was able to contribute to the marketplace output of tradable goods. Skills arbitrage employment roles gradually developed in relation to total resource capacity - not just that of nations, but to some degree of international wealth.

Unfortunately, asymmetric compensation for time based product does not contribute to increased marketplace output in the same way. Even though greater skills capacity resulted in better time based product, it did not increase marketplace output. As a result, even as the marketplace expanded for tradable goods, time based product did not have the chance to achieve the marketplace outcome that populations sought.  This is why asymmetric compensation is not as effective (in terms of macroeconomic outcome) for the time based product of non tradable goods, as for tradable goods.

Time arbitrage could eventually create greater marketplace representation for time based product. There's another opportunity aspect to time based product, as symmetrically matched and compensated. Many forms of knowledge and skill which end up "pushed aside" in a society which devotes many resources to critical knowledge, would once again gain room for fuller expression in society. By assigning equal time value to knowledge use, groups can coordinate for time and skill value in ways that provide more equal opportunity for knowledge diversity as a whole.

Further Rationale for Domestic Summits

Several recent posts from Arnold Kling, reminded me of issues that are pertinent to the kinds of organizational capacity which domestic summits would also address. Regular readers may remember earlier posts on my part, which discussed domestic summits as a way to begin the process of creating new communities. A commenter asked Arnold Kling:

If we are over-educating our workforce, then why don't entrepreneurs find and train non-college workers at lower lifetime salaries?

Kling replies:

Very good question. Equivalently, why don't non-college workers try to convince entrepreneurs that they can do the same work for lower pay? 

Of course one needs understandable settings among a wide variety of groups, in which it is possible to do so! My first thought upon reading his response, is that lower pay as a logical move, would involve a restructuring of organizational marketplace costs as well, for both living and working. Otherwise, those with lower pay would continue to struggle with the oft ill defined consumption expectations of general equilibrium. Hence taking this into account is what I have referred to as an alternative equilibrium response, to the normal costs associated with general equilibrium conditions.

While reductions in business overhead are important, simpler forms of business structure would allow all summit participants - even those who may not consider themselves particularly entrepreneurial - to create new community and participate in marketplace outcome. Most important is the fact many such beginnings would result in positive and long lasting effects.

Among the many retail possibilities, are updated variations on pushcart vending such as market monetarist Benjamin Cole has proposed, and he explains their benefits to a commenter in a recent post at Historinhas. Even though higher income levels have often sorted for business patterns that negate pushcart vendor related options, other income levels would welcome flexible retail in new marketplace design. Retail production choices are especially becoming more important, as big box retail finds little incentive for either building or remaining in communities without high income levels.

A framework which makes greater use of lower wage and income potential, would allow infrastructure and environmental factors to move closer to the resource capacity of each group. As participants determine what is possible in this regard, follow up summit gatherings would allow those who ultimately commit, to select among the marketplace constructs which new groups wish to pursue. These resultant settings could be thought of as free market innovation zones. In these zones, what would otherwise be labeled "disruptive" (i.e. undesirable) innovation, can take place without posing direct threat to the general equilibrium conditions of prosperous regions. Domestic summits would serve as a starting point, for the selection process of more unique settings than today's standard zoning and regulatory environments allow.

There's another aspect of the resulting selection processes among potential groupings which deserves consideration. Sometimes, what appears as though discrimination, is simply the desire of individuals to work and live in groups that are similar. Years earlier, working with others who had experienced a lot of discrimination in their lives, I remember being astonished when they nonetheless expressed a preference for much of their time to be spent with others who could relate to life experiences held in common. Often, this was a matter of race preference as well.

However, these natural grouping tendencies are often confused with discriminatory activity in the marketplace. Part of the problem is that too many groups end up competing in an economic arena which lacks sufficient production and consumption space for all involved. The domestic summit response is for self selecting groups to create more marketplace and economic access for everyone, instead of encouraging anti-discrimination processes which are mostly a battle over the already existing pie of general equilibrium. Some aspects of direct democracy would be within reach (for time value in particular) in small group settings, because the results are not those which millions of individuals are expected to comply with.

All who take part in domestic summit proceedings would need to approach them with an open mind, to create a positive experience capable of long term potential applicability. It would be difficult for anyone with a negative attitude regarding "opposing" lifestyle options in general, to add value for a particular marketplace option among many possibilities. Domestic summits would strive to multiply social capital, instead of continuing with today's political efforts to closely restrict anything possible in this regard. Again, from Arnold Kling:

...one possibility I want to throw out there is that people want affluent neighbors...high prices is going to make me want to live there.

Few individuals with a substantial income would feel otherwise, given the unfortunate lack of trust that has become a feature of the U.S. landscape. In the thoughtful comments that followed, some noted that the only remaining forms of discrimination that are still possible, are those of price and meritocracy. Prices have been unnecessarily bid up because too few other possibilities exist for the natural forms of association that people seek. Even though discrimination certainly has negative implications, one's desire to sort for lifestyle preference is not the same thing.

Anti-discrimination policies sought to provide economic access in an arbitrarily limited marketplace. However, a better approach would have been to create sufficient marketplace space which provided production and consumption potential for all concerned. This is also an important reason greater flexibility in property ownership is needed, so that mutually held real estate can also be coordinated for changing preferences in working and living arrangements. Today, most neighbors live next door to one another not because of any personal preference, but because of the limited pathways which today's property ownership makes possible.

Over the decades, I've observed alternative production/consumption options that were lost because they posed too great a threat to the existing order. The seventies in particular, were a time of great hope for both infrastructural and healthcare options which for the most part did not see the light of day. Now, today's struggle with food trucks and digital platform transportation feels reminiscent, as these options also pose a direct threat to existing general equilibrium conditions.

What's more, the political arena doesn't acknowledge that special interests and government alike continue to put sand in the gears, of what otherwise would be greater choice and innovation in the marketplace. Instead, political parties react to the existing order in ways that could undermine both economic and political stability. Domestic summits would provide means for individuals to present alternatives that don't pose a direct threat to the status quo. There is no reason, why any society should have to live by the same set of economic rules, regardless of income. Still, creating new patterns for life and work is best approached with a live and let live perspective, for the best possible outcome.