Post-Monetary Economics
The title of this post is not, actually, a contradiction in terms.
What it is, I think, is a discipline which will ultimately define the latter half of this century. The open source community has, for decades now, been fueled by non-monetary value. The Linux operating system has a lot of value in it, for example. Blender, the open-source 3D modeling and animation program, has a lot of value in it. But no money.
Behavioral economics is the discipline of figuring out why actors in economic problems behave “irrationally” with regards to raw economic benefit. Increasingly, of course, what it really does is reveal sources of non-monetary value in people’s rational choices. As it turns out, we do behave rationally in many cases, but with respect to things we value which are not worth any money. (There are plenty of actual “economic illusions” which cause people to make predictably irrational decisions, but even ignoring these, behavioral economics would still be necessary.)
This month in Wired is an article about “the new socialism”, defined as the bottom-up networked fashion in which services are created, seemingly from nothing, by groups of collaborators who do not exchange money for their work. If one were to consider the work put into a typical open-source project and then compute what it would have cost to pay the designers to create what they did for free, I think it would become rapidly clear that open source is creating huge amounts of wealth, without money, every year, already.
The RepRap tagline, wealth without money, is already true. It’s already happening. And as digital fabrication lowers the barriers to product creation, the wealth without money already being created in the software world will begin pouring into the hardware world. At that point, governments will no longer be able to ignore the value creation of open source, because it won’t be something that “just happens on computers” anymore. The smart governments will alter their economic metrics to measure and encourage this wealth creation, although surely some governments will mislabel it as a scourge, interpreting falling monetary activity as a drooping economy.
But post-monetary economic theorists will, I hope, be working out ways of showing off the value-creating engine of open source, ultimately making mathematical compromises that show economies which now grow by calibrated work-hours instead of dollars, revealing new ways of getting the biggest economic impact out of a community of workers. Ways which, in the end, might have surprisingly little to do with monetary incentive. I think there’d still be money. But what it means, and how it is used, are very likely in my view to change dramatically in the next few decades.
And I think for governments that are responsive and wise, that change will be for the better.
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Demented Chihuahua Said,
June 1, 2009 @ 1:21 pm
Totally agree. And without a doubt, some of those governments will take an active role in trying to suppress this sort of “economic crisis” within their borders.
What really remains for those of us who like to contribute to this stuff already, is to unhook ourselves from the need for money by creating the sources of those commodities we consume. To become fully sufficient within our own communities. Then we can sit back and watch the tidal changes in the world and wonder and speculate on these sorts of networked forums of communication.
Demented
Allan Ecker Said,
June 1, 2009 @ 1:27 pm
You actually touch on a key objection to advocates of joining the non-monetary economy, which is that “food and rent can’t be crowdsourced”.
HOWEVER, and there’ll be another column on this later in the week, I think food CAN be crowdsourced (we used to call it farming) and rent can be, well, tweaked. In addition to this, I can readily imagine a dual-motive economy run with both monetary and non-monetary wealth, where most citizens have a pretty minimalist existence from a material, monetary point of view and an increasingly baroque non-monetary existence.
Until we get done hacking food and rent, anyway.
Nick Taylor Said,
June 2, 2009 @ 3:54 am
I can’t see it without land-reform myself.
Right now, the average human? certainly the average inhabitant of the internet, spends a massive chunk of their lives either paying rent, or paying interest on loans to cover a house purchase. We’re basically dilute slaves.
This bulk of this colossal amount of money is creating no value. It’s simply being transfered to people who are richer.
To get off at the bottom… to set up a system where people can simply look after themselves, we have to get out of this trap.
I don’t know how I’d arrange it – and it would wipe out the incomes of huge numbers of landlords and banks, but I think that “a place to live” should be a basic, free human right.
And landlords and banks? Well… when did we decide that something for nothing was a good idea?
Enrique Said,
June 2, 2009 @ 4:07 pm
The best way to arrange land reform is with a land value tax:
http://en.wikipedia.org/wiki/Land_value_tax
It works well, it encourages high density developments that use little land, and it is easy to implement. It is only used in a few places because land is how the elites ultimately get their power and they rarely choose or are forced to devolve their power.
Until then, once we have a reprap that can make house components, we can look for low value land in the middle of nowhere, and build there. Or we could build floathomes in places without mooring fees.
Demented Chihuahua Said,
June 2, 2009 @ 4:49 pm
That’s a good point about the land issue. Hadn’t thought of it. I believe as Allen does that food can be crowdsourced or at least hacked into a non-issue. But rent, hmm…unless we all want to become transient, high-tech squaters…I don’t see it happening in our current state of affairs. Stange to think that we could have all the other problems worked out but the guys with the sticks could kick us out of our homes…
Demented
Sam Said,
June 7, 2009 @ 9:02 pm
The production of food is nearly entirely automated anyway. If the means of production are rep-rapable, food doesn’t need to be crowd-sourced. You could grow your own without putting in any effort. I’m looking forward to the open source farming robot.
Why should anyone be forced to do any job which can be effectively automated?
Mike Said,
July 6, 2010 @ 3:54 pm
Really good points. I totally agree that land ownership is the greatest barrier we face. I think there could be one easy fix, though I confess to not fully understanding the economics involved, but how many of our parents own their own houses? If we could abolish inheritance tax, at least for people on the lower-to-middle end of the income scale, then it seems over a few generations a large percentage of the population would actually own their own land by keeping property in the family.
It seems wrong that when I inherit my parents house, I can’t afford to keep it as I would have to pay the inheritance tax and so would be force to sell. This just seems plain wrong, and something designed to keep the rich rich.
How many evils are perpetrated with the excuse, “I have to pay the mortgage”?
Mitch Said,
January 14, 2011 @ 6:22 pm
While digital fabrication will cut down on production costs, most production costs come from resources (including land). Real wealth is based in the ownership of resources, so to achieve the society you’re discussing you’d have to open-source resources. There’s an interesting article about this here: http://tinyurl.com/7slmf3