I'm convinced most economic models are broken.This model decomposes all economic activity into the simplest possible consistent units, each of which affects what at most 2 people own, are owed and/or owe. And composition is linear: the whole is the exact sum of the parts. So it's a rigorous macroeconomic model. The only maths needed is simple vector arithmetic.I'd like people to know about it, because I think it can help to avoid (or maybe rebuild from) economic calamity. It does a great job of finding errors in other economic models, and it shows that most people's intuition is actually correct.Let me know what you think.The model from first principles:https://www.economics21st.com/p/the-7-economic-actionsAnalysis of Bastiat's broken window fallacy:https://www.economics21st.com/p/the-broken-windowTopic index:https://www.economics21st.com/p/topic-indexThanks!
What if apples are not renewable
>>62100683We already got a Newtonian economic model What goes up must come down
>>62100683Sorry, I prefer that the Fed and banks create new currency ex nihlo because it ultimately pumps my shitcoins and makes poorfags poorer through inflation.
>>62100813>What if apples are not renewableIf you can't produce any more apples for some reason, there just won't be any more "produce apple" actions. Is that what you were asking?
>>62101449>Sorry, I prefer that the Fed and banks create new currency ex nihloSure. That's a "new debt" action. Bank gets new liability, holder of new money gets new asset. Money creation is as simple as a bank writing an IOU (often in exchange for a customer writing an IOU in exchange).https://www.economics21st.com/p/money-and-banking-1
>>62100683You forgot that e equals mc2 + AI.
reminder: owning something desirable will never make you as a person desirable
Ok where is resource scarcity accounted for ?
>>62102268>Ok where is resource scarcity accounted for ?Thanks for the question. Are you referring to raw materials like oil, coal, iron ore, wheat, etc.? If so, production actions (someone gains a tangible asset; nobody loses one) can only occur if those materials are available to mine/harvest.If you're referring to the scarcity of manufactured things, the total quantity is whatever's been produced to date minus whatever's been consumed to date.One thing to clarify is that the model doesn't try to predict how the state of the economy affects people's actions. Instead, it shows how people's actions determine the state of the economy.People's actions in the model are exogenous (independent variables), like forces in Newtonian mechanics. Newton's laws don't tell you that a human can't push an object with a force of 1TN, but it does tell you what would happen to the object's momentum if they somehow managed to do it. Similarly, this model doesn't tell you what things people are able to produce, transfer or consume, but it tells you exactly what happens to what everyone owns, is owed and owes if they do manage to do that.One of the most important results is that, apart from production and consumption, all actions are zero sum for "raw" net worth (what people own + what they're owed - what they owe). Combined with the linear composition, this is a very powerful result e.g. QE is zero-sum at the macro level.
>>62101595woman is assetcan be owned purchased and sold
isn't this austrian theory, what you own is more important than infinite growth, that is tracking it, i've been thinking about how transitioning into this might be the solution to our ai problem
>a whole column of zero>All economic activity is vector mathNice slop retard
>>62100683Yes, it literally is this simple. All the complicated extra layers of economics are everybody hiding their thievery from everybody else and trying to paint it as a good thing.
Assuming you're the author. How is your model different from good ol' Assets Liabilities Income Expenses Equity? Isn't your RNW basically just an entity's equity? Or, if you use the double entry accounting model, "negative equity" (since you must always have A+L+Eq=0). In any case wouldn't you say that your model is more of an accounting model rather than an economic model?It's fun to think in this way. Any financial entity is a body system, aggregating/evaporating mass through income/expenses mechanisms (so I/E are just inputs/outputs). Equity is the virtual mass of the body while A is the volume of the body and is a hole in the body (L>0 means negative hole).For inst when I go buy food I track it like this: 50 leaves A, 25 accounted as an Ex and 25 as a debt to my gf so L increase. My financial mass i.e. Equity only decreases by 25.I also receive a gobernment credit of 100 each month, i split it with my gf as well. I could put +100 in A, -50 from I and -50 as a debt to my gf. But that makes no logical sense; she hasn't lended me any money, even in a virtual sense. The problem here is that the 100 the gvmt is sending is an input, and inputs are contravariant, you have no control over inputs, you can only react to them. in particular i cannot split the input into -50 income from gvmt and -50 from gf; i have to take the whole input at once. The only thing I can split are outputs, which are covariant (for instance that grocery debt above, im able to split that into an Ex + virtual debt to gf; all systems have control over what they produce). Anyways, instead of doing input splitting, I put 100 in A, -100 accounted in Income, -50 into L, and +50 into Eq. By A+L+Eq=0 my Eq has only increased by 50 bucks, even if my A have increased by 100.All of that shit to say that Eq is the right thing to track, anyways, if that's what you're doing but in another name, then I agree. Otherwise, what do you think are the differences between the system i just "described" and yours?
