Saturday, 17 May 2014

EIRE ABUndance

 Economics Of Abundance Getting Some Well Deserved Attention




It's great to see Chris Anderson getting lots of attention for his recent talk on "the economics of abundance," because it's exactly the type of thing that a lot of people have been discussing for a while -- but still hasn't permeated the mainstream. In fact, it's quite similar to the talk I gave at the Cato Institute back in April in discussing why certain people seemed to have so much trouble grasping the economics of the digital age. Basically, it's the problem that occurs when people focus too hard on the idea that economics is the study of resource allocation in the presence of scarcity. That only makes sense when there's scarcity -- and in digital goods, scarcity doesn't exist.

Dave Hornik has a wonderful post about Anderson's talk while Ross Mayfield is also discussing how he's come to realize that the economics of scarcity doesn't apply digitally. Now, if we stuck with the focus on "scarcity," then I should be upset that these two are basically repeating the "idea" I discussed back in April. Those who keep harping on the importance of "property" and love to say that you can "steal" content might even say that this idea was "stolen." That, obviously, is ridiculous. These are basic ideas that we have all realized is fundamental and a truth of economics. And, it's hardly a new idea (which is why my one quibble with Anderson's own post is his decision to call the idea of the economics of abundance a "radical attack"). Mayfield talks about those who helped him realize it, from Jerry Michalski to Howard Rheingold. In the comments to that post, Julian Bond brings up the ideas of Buckminster Fuller and and Alan Cooper. In my case, the inspiration came from many different people, including the teachings of Alan McAdams (my old mentor and professor) and the writings of Brian Arthur (who focused on "increasing marginal returns" rather than diminishing ones) and even back to Thomas Jefferson, who famously said:
If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of every one, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me.

That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density in any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property.

So, no, it's not a new idea at all -- and yet, many people still don't seem to want to understand it. They don't believe that the free market can function with a lack of scarcity. It's understandable why that could make some uncomfortable -- but, it's a fundamental misunderstanding based on this desire to force scarcity where there is none, just so economics can continue to be the study of scarcity. It's this inability to get rid of that scarcity thinking that's holding back a number of developments these days, and the more people who realize this and the more people talking about this, the better. And it is fitting with the theory of abundance. The more abundant this discussion is, the more likely people will grasp it. And, it's especially exciting that someone like Chris Anderson is pitching it, because of his ability to take complex economic ideas and make them easy to understand, while getting people to listen. Hopefully, this is just the beginning of a widespread discussion about this topic.

A world of abundance is just at our finger tips, we no longer need to deforest trees as we can produce artificial wood chemically (when this catches on, it's going to be big), and vat grown food will ensure an infinitely sustainable food source, air and water recycling will make water sources more sustainable, and wide scale automation will take over more and more work. There will be some trial and error along the way, and a period of adjustment, but none of these changes are a bad thing.


Something I have not yet explained is that things can act like they are free even if there is a some small cost. The supply exceeds the demand so much that they are treated like they are free. It not worth the effort to count the cost. Free refills, free WiFi are some examples. Now what if the thing you sell becomes free? That is happening to everyone because technology is replacing labor at all levels. So the is plenty of everything but you still can have it. Its a divide by zero problem.


Part2 The question you have to ask yourself is at any particular point in time is. Am I being forced to choose between competing uses of something? Be it: money, time or resources and effort of various kinds. If the answer is no. Then you live in another reality. If it is yes then the basis of economics remains untouched.


Even if a good ceases to be scarce then that still does not cause a problem for economic theory.The the one thing that is in the general sense completely free(under ordinary circumstances)is the air we breathe Yet is this a problem for economics? Of course not. It is possible to respond to this by saying that we do not have to pay the trees to make oxygen. Well if we have to pay them it is clear that their product is not abundant, if it were it would be like air. A non economic good


The reason countries in Europe are poor is because of the use of force. If individuals or the government steal what you make then it is hard to progress. If the government stops you from doing new things then it gets hard to change. That is happening in the wealthier nations. People acting on their own such as: permaculture, 3D printing, home schooling, and other distributed self made improvements is the path abundance will take. The elite don't want change, they already have abundance..



thank you for your fast reply on "why we don't have flying cars". When you are borned and live in a poor country in europe you will understand better why i say that the advancing of the human kind is still very slow and based on money.You have great ideas,great tutorials or idk how to call them but from theory to practice in some countries there is a huge step, maybe imposible.I made a post on the starwreck blog (the Iron Sky movie) , google "quotes on piracy beyond the iron sky" by Crissti



A technical point. Scarcity The excess of wants over the ability to satisfy those wants. Abundance - the opposite of scarcity. Scarcity necessitates choices between competing uses of existing capabilities. Opportunity cost being the benefit forgone by choosing the next best option.



The transition to abundance is likely to be very painful. Technical unemployment should be a great thing but we don't have broad ownership of real capital (stuff that makes stuff). Until we achieve global abundance of the needed stuff we still need a reward structure and a way for people to get the things that are not free. Another big problem is many people don't know how to live without being forced to work. They aren't self motivated. Spring break 24/7 or doing nothing causes problems.



There are a few things that a naturally scarce. For humans time is a quasi scarce. We only have now. But we can invest our nows to make future nows more productive. So that even makes time less scarce. Of course we still have attention and lifespan. Attention can be increased to a degree with technology but its also a little weird since attention is part of demand so as your attention is consumed you demand decreases leading to supply / demand >= 1




Excerpt from The Art of Abundance



The art of abundance is the art of awareness. It is a way to count our blessings and practice mindfulness in our daily living. Becoming aware of the small, the little, and the least offers us an opportunity to open our hearts to a larger perspective. We learn to value the tastes, textures, scents, sounds, and sights of our lives as they present themselves to us moment by moment.

Children practice the art of abundance naturally, but often as adults we love the ability to explore and experience wonder. By choosing to be aware of the gifts life brings, we become lovers instead of critics, believers instead of doubters, and childlike mystics instead of world-weary cynics.

Practicing the art of abundance has been a transforming process in my life. My spirit has been renewed and my heart refreshed whenever I have chosen to thank the great Creator for the blessings that come my way. It is my prayer that this little book will enable you to affirm the goodness of creation and discover how rich you are in the things that count.

Abundance is…not how much I own but how much I appreciate.


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