Simulated Economy

[SSFSX17]

1) Let the things we write be our "products," since that is all we can really do. It is difficult, if not impossible, to have a real business online that lives within a micronation's borders. If I were to have a real business online, I would end up screwing the borders and going for the gold. It is only our writing and socialization that make this micronation "worth it," so to speak.2) Let people choose to "buy" writings simply by reading them and acknowledging that they were really worth reading. They pay their time, obviously, but they can also "give props," that is, declare that the writer deserves a certain amount of credit for the work he/she has done.3) Obviously, people need some "money" to start with as well. After all, if we all start at a zero point, then people will struggle just to break even. So we could also say that certain jobs create money out of thin air, or by directly converting certain products or resources into money. This goes back to the primitive concept of mining gold, turning the cold into coins, and saying that you got more money just because you shaped gold into coins. One could argue that this is not necessary to start an economy because of the alternate 3 and 4 below...4) Once the economy is active enough, we can cease to fix the currency's value to certain kinds of work. Fixing the value of currency to a specific product is very necessary for starting an economy, but the currency must eventually become free-floating. This means that the currency's value is not in how much of a specific product a unit can buy, but rather, the relative values of products and services to each other. IE, you say that a candy bar, a soda, and a dare to drink something gross are all worth the same (one US dollar), so that it is the currency that is the standard rather than the products.3-4 alternate) Another possible method of starting up an economy is to indeed start at the zero point. However, the government would purposely put a lot of currency into circulation, thus inflating its value. This makes more money for everyone to have, yet also decreases the value of each individual unit. The idea is that debts always remain the same, including their interest rates, so inflation gives somebody more money to pay off debt while still having money left over. The disadvantage of inflation is that it causes your currency to have less buying power compared to other currencies, meaning that imports become more expensive. This is a serious consideration for countries that are not self-sufficient (almost all of them), although it improves exporting power.5) If other micronations follow this model, then we will all eventually have to hammer out a currency exchange system as well. Since the value of any free-floating currency is affected radically by people simply converting large sums of money from one to another, we will also need to figure out protections against someone trying to purposely boost or crash the value of a nation's currency.You could argue that you simply shouldn't let a currency free-float in value, but that creates another problem. The currency's value becomes entirely fixed to the value of the thing to which it is fixed. Gold is used for tooth fillings, making things look pretty, and high-grade electronics. Fixing the worth of your currency to how much people fill teeth, make things look pretty, and build high-grade electronics is pretty stupid when you consider that economies consist of so much more in them.Oh yeah, this is precisely what the Federal Reserve does: It's just a big pile of money that chooses to give cash to all the banks of the country at certain speeds. Cutting the interest rate means cutting down on how much cash it distributes to banks. Or, the Fed could just plain give everyone some free cash, except this is a lot harder. Cutting the interest rate was supposed to help the economy of the US because this would have stopped the US dollar from inflating out of control. Supposedly. This is so that Americans can keep on buying stuff from foreign countries (including labor). If this sounds like a bunch of voodoo and utter nonsense to you, that's because it is!I, personally, am a strong believer that we should just slow down our lives and go back to bartering. However, bartering is only possible if everybody consumes and produces related things. As writers get more specialized, as we eventually develop professional reviewers, as we develop "magazines" (best described as a bunch of writers making their work exclusive to a certain website), and perhaps even as we develop people whose jobs are to analyze and make guidelines or simply manage the "direction" of certain writings, it will become impossible to barter.We're not exactly at the kind of economic volume that would require you to understand a single thing I just said. However, do be aware that if you really want a simulated economy, there is a lot of work and planning involved.

[SSFSX17]

Here's an example:Let's say that a citizen writes an especially fascinating piece of history. We all give him "S-props" (Shireroth props, which are worth 1,000,000 times more than Xanga's e-props). That leaves us in debt to him, because we never had any S-props in the first place. The government could collect sales tax, thus giving the gov some actual money to work with. Then, the gov could not only pay its employees with the money, but also give us even more freshly printed money. After all, money is nothing but a bunch of paper or electronic data. This makes the value of the money worth less (we'll have to give the guy even more S-props the next time he writes something), but our debt doesn't change with inflation. So we pay the guy back our debt and still have some S-props left over. The result is that the guy gets his S-props worth, and we get to make money off our jobs rather than simply cancelling out debt caused by buying stuff.There are risks involved with inflation, which turn into actual danger if other nations start investing heavily in ours and we end up having to buy a lot of their stuff. Also, the currency could potentially hyperinflate so greatly that the people don't even use the currency anymore and go back to bartering. At this point, a bunch of crazy revolutionary socialists will probably rise up and cause problems, but I don't see that in the near future.If this sounds like a very stupid trick that only works on paper, that's because it is!Money in itself is only worth something if someone values some non-monetary object or service with money, IE, someone says "I'll write a geographical overview for 1,000 S-props." So you see, finances and stocks are a bunch of hocus-pocus that somehow manages to make everyone rich except for exploited people. But people can't get exploited until the concept of the regular salary and specialization is introduced. That is, the volume of economic activity gets so high that businesses have to have professional accountants, professional managers, people who focus on just writing, people who focus entirely on the promotion of certain writings, etc etc. The exploited people are the people who don't have access to education or are intentionally barred from all the "high" jobs. This is all very far away from where we are now, but you can hopefully start to see more and more of the the meaning of a national economy.

[Austi Scot]

SSFSX17While I understand the things you are saying in these post, please remember that I am the Minister of Trade and that you work in my Ministry.I am moving this thread to achieves - for the time being please do not attempt to do my job. You may run have a free hand in running the stock market for now.Please do that and perhaps attempt to entice people to be involved in the economy. This portion of the economy may not be set up or run as you would do the job – but please remember it is my job to do this part.While I can agree with many if not all of the aspects which you put forth in your writing there are reasons that we are not going to adopt them at this time.Austi ScotMinister of Trade

[david northworthy beckfor]

Quote:Let the things we write be our "products," #but what about those who cant wriote? *points at self* "Disclaimer: Whatever is in the above post is probably a result of my blind following of Kieran Bennett, because I have even less of a brain than Kieran. Don't even get me started on my lack of independent thought."

[Scott Alexander]

Austi, no offense, but didn't our last attempt to start an economy fail pretty badly? And isn't the plan currently just to start it back up again the same way without formulating any sort of a new system? And isn't that kind of a recipe for disaster? Maybe we should spend a while considering various alternatives, this plan (which seems pretty good) among them, instead of just saying "Okay, let's do the same thing that's always gone badly before, and let's start as soon as possible!" Edited by: Scott Siskind  at: 2/17/04 10:47 am

[SSFSX17]

To Mr. Beckford: Then you'll hope that someone hires you to do something that doesn't involve writing. Or you could be a professional promoter / reviewer / marketer.

[Austi Scot]

Scott,No offense taken - Our last attempt to start an economy didn't fail at all - perhaps it was the time before that. The last time I left just after barely getting started because I was making war plans (that are now not going to happen).The plan now is to start it up much the same way I had begun - but that isn't a plan for disaster because the plan never got going - due to my leaving and no one taking over. The working out of an economy can be successful and what I'm planning is not the same as we've so often seen.What we certainly shouldn't do is have a two headed monster and we most certainly shouldn't have the Landsraad making laws as to how the economy should be run, such a path has been the down fall of so many micronational economies.If people are willing to give my economy a period of time to try it I think we can make it work. In an effort to include the ideas of others I have "hired" SSFSX17 to set up and run the stock market. I have not stepped down as Minister of Trade.However, if you and others want to have the economy as described by SSFSX17 by all means either get the Kaiser or the Landsraad to fire me and to hire SSFSX17. But please make up your mind soon as to you position on having me or SSFSX17 run the economy.I won't be offended - but if I'm to run the economy I will need to follow my plans - if SSFSX17 is to run the economy he will need to follow his plans. - Either way we need to know.Austi

[Scott Alexander]

Ahhh...so it only stopped working because you left. Okay, sorry, I thought it was just inactive for no reason. You're right.

[SSFSX17]

In ideal circumstances, economies run themselves as long as the government maintains high competition in both the supply and demand sides. Then again, perhaps an overly realistic plan (ie, works exactly like the real world does) is not suitable for a micronation. I'm sorry for going nuts and dumping all my thoughts about the parallels that could be made between a real national economy and a micronational one, when the two are very different because the supply side does not need to meet any deadlines and the demand side does not have to buy anything.

[Austi Scot]

SSFSX17In ideal circumstances economies run best when the governments enact the fewest laws. Basically allowing the nation to have a free economic market. You and I both know that some people disagree and believe that an economy directed by the government is the best. I fall on the free market side with government regulations against fraud and harmful products and services.In my approximately five years in micronations I have seen short lived stock markets working much as you have describe how you will set things up here. However, it is my belief that these short-lived stock markets have been due to the short-lived economy in which they operated. In other words, stock-markets in micronations such you are setting up can work very well in micronations if they have a stock market manager who is willing to do the necessary work. The real problem has been getting a long term economic simulation going.The real world supply and demand model has been discussed many times and in fine details between individuals and by commissions set up in micronations. In fact the ideal has been openly discussed by all willing to participate, myself included, at least three times over the pass five years.Several micronations have had an economic simulation based on the communistic model. All of these of which I am aware have been the micronational government Minister posting that production has taken place and goals reached, etc:The problem I have seen with both is that if there is too much for people to do they do not get involved. We must take baby steps if we really wish to get a simulated economy going.This means that we must first of all get at least a few people who are willing to participate. Then we must make it both fun and easy for them to be a part of the economy. This means things must be complicated enough to gain their interest and yet we must be willing to as much as it takes for those who don’t want to deal with the complication but otherwise would be a part of the economy.That being the case, and the fact that I have seen several micronational economies attempt to simulate real life economies and fail, it is my considered opinion that we cannot yet implement the plans or similar plans to those you put forward.Please take note that of the word “yet”. But if several people who run the economy will stay with it for at least six months and perhaps a year or more a fun simulation of an economy can be put in place in micronations.Austi

[SSFSX17]

I have basically zero experience with micronations. That is, all I know is that a bunch of people decided to create a community with pseudo government, claim land, and wage warfare on ezBoards. I'd argue that phpBB or YaBB on a home-run server is much more conducive to even trying to pull it off, and that borders ought to be more restrictive to mean anything (since the only purpose of a border is to restrict) but that's for another time and place.Basically, all I can tell is that people in micronations only do a few things that are exclusive to their micronations and cannot be said of just any Internet community:- Maintain feudalistic government while going through a lot of trouble enacting very explicit laws and following them through to a strict degree.- Create histories, legends, geographies, and maps of imaginary places.The key is to focus on those two things. My idea was to make those two areas, mostly the second, privatized and pay a kind of "appreciation" for the work done. The "appreciation" itself would be made into a currency. You get people who are interested in doing nothing but accounting so that other people don't have to, people who gather statistics, people who analyze statistics and make reccomendations, etc etc. None of them have to understand the whole picture except for the analysts and decision-makers.As far as getting people involved goes... it's the Internet, and I never really expected much out of the average Internet-dweller. Since an economy based entirely on posting on an ezBoard will require a lot of volume, the solution would be to conduct a lot of mergers, or at the least, a trans-national economic union.In the end, it comes down to what people get to having an economy based entirely on "props." I think that we can give Internet authors in general less work by simply letting them write and let some simu-business handle the rest of the work of publishing and promoting. Readers can work a government job, like collecting stats or accounting, while letting "magazines" or groups of dedicated reviewers handle the work of figuring out what is good and what similar to 90% of fanfiction.net's content. Which is another problem that would be solved: people who can't write well would either get adopted by a business and trained intensively as an investment for future gain, or they would be unable to find an audience. The problems such a setup could cause would be far less severe than the consequences of writing for hard cash because it is impossible to force even 1% of the Internet to get locked into a monoculture.Then we get back to the problem of people wanting to be involved. The motivations for starting a business, or investing in pseudostocks, or just accounting, are the rights to read other people's stuff because promoters and reviewers promise a good reading experience. People who don't want to read this kind of stuff don't even have to know that micronations exist (I certainly didn't know until last week).If we want to do things in hard cash, there is no need for micronationalism. Monopoly money is only useful for playing the board game of Monopoly, meaning that people have to want to play the board game of Monopoly as opposed to, say, improving his/her Starcraft ladder ranking or just going to a MMORPG (because those have prettier graphics), or even a browser-based strategy game (uncountable numbers of them on mpogd.com). And money that not only comes from nowhere but also doesn't buy anything, not even bragging rights, is called an "e-prop" on Xanga.com (I love ripping on blogs).It is true that one may be writing purely for the "bragging rights," which transforms a currency of "appreciation" into a currency of sheer pride. But this happens often enough in the economy of verbal abuse, and I doubt that it could actually be enhanced by the notion of an economy based on the concept.I'm mostly looking at this in terms of what a random person on the Internet has to gain from participating in a micronational economy, something that cannot be gotten from a MMORPG or browser-based strategy game or pen & paper RPG campaign or sourceforge.net project or for-hard-cash online organization or any number of other types of Internet communities. I'm not knocking the concept of a micronation, because there is a lot of potential to be unlocked from such a notion. It's just that a random fellow like me needs an incentive besides that there are people there.Protections against loss of real life would be slow pace, not having real money at stake except for the people who pay for domain-name registration (and the admins can offer whatever sum of "appreciation" cash they want in exchange for real cash), and slow pace. Simulated economies can't take much of your time if you only had to check in every Saturday and you'd still be up-to-date.However, I am mostly a visionary and writer, and not much of a real doer except when it comes to getting more stuff and loot for myself. I have one of the largest ROM collections of my college dorm and hope to "sell" the ROMs to them for "appreciation" money one day, instead of just telling my good friends, "Dude, you have to give me the blank DVD-RW" or "you owe me some ripped anime in return." Because then we know how much "favor" we owe each other, thanks to a whole economy of favors. But that's way beyond what I think micronationalism can possibly hope achieve.For a serious real-life example, the economist Paul Krugman (who can be read at http://www.pkarchive.org/ although he is a little bit leftist) discussed in his '98 book The Return of Depression Economics the example of a babysitting co-op. It was a bunch of people who agreed that they would receive babysitting coupons if they babysat each other's children, and they had to pay for all babysitting favors with the same coupons. The system behaved incredibly similarly to a real economy, all the way down to recessions and how a recession could be solved. And it was just a bunch of people babysitting each other's kids and "buying" a night out alone without having to worry about the kids. So the key for a micronation to have the same level of success is to discover these "favors" that people can do for each other and make the most of them.

[Austi Scot]

Quote:So the key for a micronation to have the same level of success is to discover these "favors" that people can do for each other and make the most of them. That is a good summation of what has to be done.

[Scott Alexander]

pub114.ezboard.com/fmicro...k48264frm6I know Austi has seen this before, but I'm pretty sure SS... hasn't. It's the archives of a longish conference a few years ago on micronational economics. You might find it interesting.

[SSFSX17]

Based on what I've read of the conference so far, there seem to be only two possible starting points:1) Gather everyone who is interested enough into one place and just start running the economy amongst themselves. If the problem is that there are not enough interested people in each individual nation, then some kind of concentration or merging is gonna have to happen. This has serious implications for micronations as a whole, mainly, they would have to merge too and then the government would experience radical changes that I doubt any noble would like. Then, people who are interested in participating by doing something specialized, like accounting, managing, or banking can plug themselves in without having to understand the whole or do things that they didn't sign up to do.2) Forget about the whole thing and decide that micronations simply won't have economies. This becomes an extremely attractive solution when one considers the aspects of micronations that would be given up, the kinds of people who would have to be imported (or the "offshoring" involved), and the people who would end up left out, in order to establish and run a "real" economy based entirely on "favors" or "props" or whatever.Okay, I lied. There's a third option:3) Found an economy of people's wills working together to build national identity through the Internet. Your sweat is your currency. Host nations on your own boxes with your own webservers and phpBBs or YaBBs as your land, because those are the only things you can really claim ownership of. Do not draw maps in the typical geographic sense, but rather, draw them as diagrams of nodes on the Internet linking to each other. While we're at it, I'm going to get to work on the conversion of the human soul to a computer program (or vice versa), immigrate to Hong Kong, and make something called "Project 2501." But that's for another time and place.

[Austi Scot]

LetÂ’s give this a try. Â… We let one individual lead a simulated economy without telling that person in detail what should be done or how it is to be done. If some might remember I put forth a plan before the Kaiser and Shireroth when I first started this economic simulation idea.That plan must be here somewhere. Here is the link: pub9.ezboard.com/fshirero...=118.topic

[Gman Russell]

I am willing to give the economy a go, but please simplify it! I'm not good with math or economics so this is alot harder for me to grasp then other aspects of micronationalism.I'm overjoyed that such smart people are involved in Shireroth, but not all of us are good at economics. I believe it's crucial you simplify it and make it appeal to the common Shirerothian; otherwise it will fail. *nods*

[Austi Scot]

I agree with you in so many ways – the economy must be simple enough for people to do it. Here is a simple way to understand the economy … Quote:To sum it up in a few sentences – You start with a little money and are told what is happening to you economically. From there you make a few choices and are told what is happening to you next.You either do nothing or take a choice available – and you can spend and trade freely with each other. (To quote myself)So, for the person involved in the economy you will need to know how much money you have – just look at your bank account.You will then have to spend your money – you will be told how much you must pay in taxes or other charges. You then just post in your bank account thread that you’re paying it.After that you look at how much money you have – and you can spend it, any way that you want. Go make a deal with someone if you wish … “Hey, I’ll pay you 1000 Erb to vote yes on this legislation.” … or “Hey, if you live in this Duchy you don’t have to pay as much taxes. It’ll pay you to move.” …. Or “Hey, your company knows how to do HTML and I have to set up this website for my Barony. I’ll pay you 500 Erb to do it for me.” ..Maybe you run the University and someone is going to pay to take a class. After you agree to pay someone you just go to your bank account and post how much you’re paying and who you’re paying.Now if you run a business there’s the process of paying your employees – but it’s basically the same thing. Your business gets money added to it’s account every so often. As a business owner you post how much you’re paying each employee and I then put the money in their bank account for them to spend.It won’t really be difficult for anyone – but there is more to do if you run a business or a ministry – but it isn’t complicated. I will give your choices and you pick which you want to do, or I will tell you that you have to pay something – like taxes – and you just post that you’re paying it.Then find ways to spend your money … or to get people to spend their money with you.Austi

[mDuo13]

Y'know, the most recent plan there would be infinitely easier if there was some kind of safer, automated way to keep track of finances. Like a phpBB mod that kept track of how much money each person has, as well as their possessions (including stocks and whatnot), and allowed for selling, giving, and trading things between users. Of coures, none of this is possible on ezBoard because you just can't modify an ezBoard like that. But yeah. I can see it working with an ezBoard. If there was a Financial Proceedings forum or something, where people performed all financial tradings and whatnot (secret transactions would be not only illegal but impossible), you could have moderators whose job it was to make sure that all transactions there were fair and legal (i.e. people weren't materializing money out of thin air).For classes, services, etc, which would cost money to have, you could have separage HTML pages which were password-locked (and linked to in a forum) -- or simply put in a place which people didn't know about-- and people would pay you for the correct password or just the URL where they could find the stuff. There could be other ways of giving out the information, such as sending via AIM/IRC, etc. Of course, if anyone else was found to be giving out such information as the passwords/urls/files, they would have to be fined by the Minister(s) of Trade and/or other government officials.

[Scott Alexander]

Sander Dieleman, a pretty good programmer, created just such a system (although it only worked with money, not stocks). Unfortunately, it's been down for a while and he hasn't bothered to fix it. He's been considering for a while releasing the code so that other people can fix it up and use it, but he seems to be taking his time about it. When he does, I know a few people who have volunteered to get it working again.Related link:pub114.ezboard.com/fmicro...48264frm13 Edited by: Scott Siskind  at: 2/20/04 1:40 pm

[Conrad Cromien]

I have a system set up that is already tested and working. But I doubt that it would fit well with Shireroths Fuedal system. regardless, I will post the link in a few days once everything has been tested completely.

[Conrad Cromien]

pub119.ezboard.com/bthecorporaterepublicofnorius thats it here, it is an example of how the economy would work within a micronation, there are still a few bugs to work out but the general idea is there

[SSFSX17]

Looks good, Conrad.

[Gman Russell]

I love your sig Conrad...

[Conrad Cromien]

Thankyou, I wish I could take credit for the sig but I didnt make it, I only selected the images and beat the artist until something good came of it. As for the economics, I take credit for that. This was one of the only times I didnt use my room full of an infinite amount of monkeys working on an infinite amount of computers to develop a micronational system.