It's good that he's thinking about economics but there is more to an economy than consumer transactions. For every product that a consumer can buy, there is a supply chain with a lot of...
It's good that he's thinking about economics but there is more to an economy than consumer transactions. For every product that a consumer can buy, there is a supply chain with a lot of business-to-business transactions.
When a bakery buys ingredients to make some cakes to sell, do they need ecocredits? How do they get them, if ecocredits can't be transferred? If they don't need them, how is the ecocredit price for the cake calculated, and what prevents cheating? Can the baker shop around to get less environmentally-damaging ingredients, to lower the price of the cake in ecocredits? Also, when they change the recipe to make a new kind of cake, a new ecocredit price will need to be assigned.
These calculations happen more naturally with money, because it can be transferred and is needed throughout the supply chain. With a VAT there are similar considerations.
With money, these kinds of calculations happen because businesses have incentives to understand their costs and keep the costs down. They don't need to be exact either. They just need to understand costs well enough so they don't set prices too low. The penalty for calculating this wrong might be selling at a loss, which can be okay for a while.
Many of the ways that we can reduce damage to the environment aren't consumer choices at all, they are changes in internal business procedures that are invisible to us. A lot of the waste associated with a purchase happens before you buy it. So getting incentives right for businesses is pretty important.
It seems like the ecocredit scenario could be fleshed out in a lot more detail, if you wanted to write a science fiction or fantasy novel or make it into a more serious economic proposal. It might be a fun exercise. But, off the top of my head, I think UBI and a carbon tax (and other taxes on environmental damage) are probably more realistic since they reuse all the cost-optimization calculations that people and businesses already do for money.
I’m not certain how you avoid implicitly assigning a monetary value to an ecocredit, wishful thinking aside. As an example, if I’m a carpenter and I make a nice piece of furniture, either you can...
I’m not certain how you avoid implicitly assigning a monetary value to an ecocredit, wishful thinking aside.
As an example, if I’m a carpenter and I make a nice piece of furniture, either you can come pick it up (and pay the credits on your gas), or I can deliver it to you (and I’ll pay the credits on my gas). Does the price I charge for delivery not, in itself, set a price on an ecocredit (plus labor), and does paying it constitute a hidden transfer?
Was tempted to post in ~finance instead because the more general idea of depleting/non-transferred credits is an interesting economic tool for other purposes and I'd like to hear some analysis.
Was tempted to post in ~finance instead because the more general idea of depleting/non-transferred credits is an interesting economic tool for other purposes and I'd like to hear some analysis.
The ideas explored in this post have also been explored and proposed by various socialists as well. Paul Cockshott explored these ideas in a fair amount of detail in his talk of the impending...
The ideas explored in this post have also been explored and proposed by various socialists as well. Paul Cockshott explored these ideas in a fair amount of detail in his talk of the impending catastrophe. Here are the slides
Labor tokens serve as that non-transferable currency, and resources (including labor) will be rationed out in accordance with need.
Here's another article he's published which summarizes how capitalist economies are not inherently better than planned ones, and shows just how badly transitioning from a planned economy to a capitalist one, analysing the economic activity of the USSR. Spoiler: After 13 years of the 'free market at work', outputs were still lower than in 1990.
It's good that he's thinking about economics but there is more to an economy than consumer transactions. For every product that a consumer can buy, there is a supply chain with a lot of business-to-business transactions.
When a bakery buys ingredients to make some cakes to sell, do they need ecocredits? How do they get them, if ecocredits can't be transferred? If they don't need them, how is the ecocredit price for the cake calculated, and what prevents cheating? Can the baker shop around to get less environmentally-damaging ingredients, to lower the price of the cake in ecocredits? Also, when they change the recipe to make a new kind of cake, a new ecocredit price will need to be assigned.
These calculations happen more naturally with money, because it can be transferred and is needed throughout the supply chain. With a VAT there are similar considerations.
With money, these kinds of calculations happen because businesses have incentives to understand their costs and keep the costs down. They don't need to be exact either. They just need to understand costs well enough so they don't set prices too low. The penalty for calculating this wrong might be selling at a loss, which can be okay for a while.
Many of the ways that we can reduce damage to the environment aren't consumer choices at all, they are changes in internal business procedures that are invisible to us. A lot of the waste associated with a purchase happens before you buy it. So getting incentives right for businesses is pretty important.
It seems like the ecocredit scenario could be fleshed out in a lot more detail, if you wanted to write a science fiction or fantasy novel or make it into a more serious economic proposal. It might be a fun exercise. But, off the top of my head, I think UBI and a carbon tax (and other taxes on environmental damage) are probably more realistic since they reuse all the cost-optimization calculations that people and businesses already do for money.
I’m not certain how you avoid implicitly assigning a monetary value to an ecocredit, wishful thinking aside.
As an example, if I’m a carpenter and I make a nice piece of furniture, either you can come pick it up (and pay the credits on your gas), or I can deliver it to you (and I’ll pay the credits on my gas). Does the price I charge for delivery not, in itself, set a price on an ecocredit (plus labor), and does paying it constitute a hidden transfer?
Was tempted to post in ~finance instead because the more general idea of depleting/non-transferred credits is an interesting economic tool for other purposes and I'd like to hear some analysis.
The ideas explored in this post have also been explored and proposed by various socialists as well. Paul Cockshott explored these ideas in a fair amount of detail in his talk of the impending catastrophe. Here are the slides
Labor tokens serve as that non-transferable currency, and resources (including labor) will be rationed out in accordance with need.
Here's another article he's published which summarizes how capitalist economies are not inherently better than planned ones, and shows just how badly transitioning from a planned economy to a capitalist one, analysing the economic activity of the USSR. Spoiler: After 13 years of the 'free market at work', outputs were still lower than in 1990.