What is 'Real' Wealth?
Patrick Henry:
I have been thinking a lot about sustainability. Not about hugging trees, but about preserving wealth.
Also, I've been thinking about what is economically 'real', inspired bythe remarks of the character Goto Dengo towards the end of the novel Cryptonomicon.
As world population declines, this will become more and more difficult. I can't see how anything can retain its value if there is less demand. On the other hand, the pie may stay the same size and simply be divided into larger pieces.
Population decline shouldn't be too much of a problem in places where people would like to move to, such as Australia.
Still, what is permanent?
Land is permanent, as long as the state stands. Although value may decline if population shrinks - people need fewer places to live, people need less food - it should still retain some value.
VCRs are great but not necessary and cannot be produced without oil and modern industrial infrastructure.
Energy is not permanent but energy is the one thing people of anything more than a subsistence existence require. Energy is the one universal input.
Doctor Thomas:
I can't see how anything can retain its value if there is less demand.
Patrick Henry, I really think that you have put the value cart before the demand horse. You don't need demand, I don't need demand, no-one needs demand. The economy doesn't need demand. The purpose of the economy is to provide supply in order to meet demand that (supposedly) exists independently of it. No demand - no need for an economy - no problem.
Less population, less demand, less of a problem (fewer human needs to meet).
The only concern that I would have with the prospect of a declining population is a population too small to have the critical mass requiredfor the economies of scale for a complex, technologically advanced society to supply all the sorts of nice material things that I like (you need a lot of farmers and manufacturers to be able support individuals like myself who hang around and Universities and conduct "research" and other valuable cultural activities like art and music). But I don't think that will happen in a hurry: projections are for a stabilisingpopulation by 2100 - not declining.
Human DEATH on a large scale is (strongly) undesirable for welfare reasons, but population decline is probably not of concern for reasonsof sustainability of wealth.
In order to maintain "value", what you essentially require issufficient control over resources/ assets in order to meet your ownneeds (perhaps indirectly, by convincing others to meet your needs in exchange for meeting some of theirs).
NB: I'm just writing up some lecture notes in which I point out thatENERGY is not limited (First law of thermodynamics: energy cannot be either created or destroyed). What is limited is negentropy (Second law of thermodynamics: entropy increases all the time). As an industrial culture, humans need to find ways of efficiently using the sources of negentropy at its disposal (eg re-using "waste" energy like using the steam from turbines to heat houses etc.)
I have been thinking a lot about sustainability. Not about hugging trees, but about preserving wealth.
Also, I've been thinking about what is economically 'real', inspired bythe remarks of the character Goto Dengo towards the end of the novel Cryptonomicon.
As world population declines, this will become more and more difficult. I can't see how anything can retain its value if there is less demand. On the other hand, the pie may stay the same size and simply be divided into larger pieces.
Population decline shouldn't be too much of a problem in places where people would like to move to, such as Australia.
Still, what is permanent?
Land is permanent, as long as the state stands. Although value may decline if population shrinks - people need fewer places to live, people need less food - it should still retain some value.
VCRs are great but not necessary and cannot be produced without oil and modern industrial infrastructure.
Energy is not permanent but energy is the one thing people of anything more than a subsistence existence require. Energy is the one universal input.
Doctor Thomas:
I can't see how anything can retain its value if there is less demand.
Patrick Henry, I really think that you have put the value cart before the demand horse. You don't need demand, I don't need demand, no-one needs demand. The economy doesn't need demand. The purpose of the economy is to provide supply in order to meet demand that (supposedly) exists independently of it. No demand - no need for an economy - no problem.
Less population, less demand, less of a problem (fewer human needs to meet).
The only concern that I would have with the prospect of a declining population is a population too small to have the critical mass requiredfor the economies of scale for a complex, technologically advanced society to supply all the sorts of nice material things that I like (you need a lot of farmers and manufacturers to be able support individuals like myself who hang around and Universities and conduct "research" and other valuable cultural activities like art and music). But I don't think that will happen in a hurry: projections are for a stabilisingpopulation by 2100 - not declining.
Human DEATH on a large scale is (strongly) undesirable for welfare reasons, but population decline is probably not of concern for reasonsof sustainability of wealth.
In order to maintain "value", what you essentially require issufficient control over resources/ assets in order to meet your ownneeds (perhaps indirectly, by convincing others to meet your needs in exchange for meeting some of theirs).
NB: I'm just writing up some lecture notes in which I point out thatENERGY is not limited (First law of thermodynamics: energy cannot be either created or destroyed). What is limited is negentropy (Second law of thermodynamics: entropy increases all the time). As an industrial culture, humans need to find ways of efficiently using the sources of negentropy at its disposal (eg re-using "waste" energy like using the steam from turbines to heat houses etc.)
posted by Patrick Henry at 11:34 PM
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