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Exponential Economist Meets Finite Physicist (2012)

dothemath.ucsd.edu

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Re: Exponential Economist Meets Finite Physicist (2012)

#41

Post by incompatible »

orasis wrote: post #2

Exponential growth can continue in virtual realities as the physical reality maxes out.

This assumes that the virtual realities are constructed in a proprietary model with consumers and producers. Actually, everybody would have to be both, otherwise the system would grind to a halt with consumers unable to raise funds to purchase products.

But information doesn't need to be rationed in that way: what happens if people join an open source virtual reality instead, where consumption is unlimited and production is voluntary? Nothing in this world would be part of the economy as economists measure it.

Re: Exponential Economist Meets Finite Physicist (2012)

#42

Post by lutorm »

age_bronze wrote: post #30

There's an underlying assumption that economical growth has anything to do with physical limits. Economical growth is a lie we tell ourselves so that innovation has its incentives, while everything else that's there because it must be there (because it will always have a demand), such as energy (but also food, real estate, etc.) just piggybacks with a similar 'fake growth' that really arises only from the fact these…

Yeah, as far as I understand, there's nothing preventing you and me just trading the same money back and forth at ever increasing speed, creating economic "growth" without physical limits.

Re: Exponential Economist Meets Finite Physicist (2012)

#44

Post by jbotz »

evdev wrote: post #22
jbotz wrote: post #16

Earlier quoted context omitted.

Energy consumption has not stopped growing in rich societies... so long as the economy grows, energy consumption grows. The relationship isn't perfectly linear only because the available metrics are imperfect, but if you have any data that outright contradicts this rather reasonable assupmtion, please show us.

https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&...

Huh, I sure put my foot in my mouth on that one... a rather big assumption I never checked. Recalibrating...

But in my defense it's worth mentioning that globally it still seems to hold true. The fact that energy consumption stopped in rich countries is apparently mostly due to the fact that manufacturing, which is one of the most energy-intensive parts of the economy, moved to poorer countries. But since the rich countries consume those manufactured products, the energy use should be counted against them too!

Re: Exponential Economist Meets Finite Physicist (2012)

#45

Post by Chathamization »

fspeech wrote: post #31
Chathamization wrote: post #24

> per-capita energy use has surged dramatically over time Per capita energy use seems to be declining in advanced economies[1]. > But if energy became arbitrarily cheap, someone could buy all of it, and suddenly the activities that comprise the economy would grind to a halt...There will be a floor to how low energy prices can go as a fraction of GDP. That seems to be a bizarre understanding of how the economy works.…

“Advances in efficiency or energy production aren't going to be stopped at some point because people are worried about someone buying up all the energy.“ That wasn’t really his point. His point was that even if energy itself is cheap there’s a floor to how it is valued relative to the total economy for such a vital commodity. If you don’t like the buying it up argument you can also think along the line of delivery co…

> His point was that even if energy itself is cheap there’s a floor to how it is valued relative to the total economy for such a vital commodity.

I don't think that's true though. There are vital commodities that have been effectively free in some societies (water and salt, for example). Even energy - wind energy is free and some societies used it extensively, and biomass for burning was abundant in some places.

We can argue whether or not it's likely that energy would get to be so cheap in the future, but there doesn't seem to be much basis for his claim that it's economically impossible.

Re: Exponential Economist Meets Finite Physicist (2012)

#46

Post by neltnerb »

Chathamization wrote: post #45
fspeech wrote: post #31

Earlier quoted context omitted.

“Advances in efficiency or energy production aren't going to be stopped at some point because people are worried about someone buying up all the energy.“ That wasn’t really his point. His point was that even if energy itself is cheap there’s a floor to how it is valued relative to the total economy for such a vital commodity. If you don’t like the buying it up argument you can also think along the line of delivery co…

> His point was that even if energy itself is cheap there’s a floor to how it is valued relative to the total economy for such a vital commodity. I don't think that's true though. There are vital commodities that have been effectively free in some societies (water and salt, for example). Even energy - wind energy is free and some societies used it extensively, and biomass for burning was abundant in some places. We c…

But if the entire earth's surface were covered in windmills to supply enough power for the economy at that point in growth, suddenly the energy has to have a floor price.

I think the easier arguments are that transformational technologies like 1000x improvements can dramatically extend growth, even if they don't stop it, and that transformational energy technologies that don't rely on the sun would frankly imply starflight. So the timelines might be off by factors of ten, and in such timelines these things don't feel so necessarily absurd.

If you're seriously at the technological stage where you can put computers with 1000x more power than ours running AI and using 1000x as energy dense of technology, expanding beyond the solar system seems pretty approximately the right place to be going.

Just unlikely. And finite. Even a very long time is finite. Perhaps this is where the economist and physicist differ most.

Re: Exponential Economist Meets Finite Physicist (2012)

#47

Post by bshipp »

Terr_ wrote: post #40
msla wrote: post #38

Earlier quoted context omitted.

> But, contra the fears of many scientists circa 1960, the limits to growth showed up on the demand side before the supply side. We ended up with a world where widespread obesity is a problem and predicted gigadeaths from starvation did not actually happen. And I think some people were... "disappointed", for lack of a better word, that this happened. That their fantasies of global collapse Soylent Green -style didn't…

I think it's more about self-unfulfilling prophecies. I mean, a happy ending for Ebeneezer Scrooge doesn't necessarily mean that the Ghost Of Christmas Yet To Come was a liar.

Malthusian advocates tend to view the economy as static. One of the most recent surges in that line of thinking was the worlds impending doom at the hands of Peak Oil. Every single trendline in the early 2000's showed us running into a supply wall with no possibly salvation.

And here we are, not even 20 years later, and America could potentially become a net exporter of oil. economics is hard because supply and demand are incredibly dynamic, and react far quicker than anyone seems to think.

That said, a non-Malthusian ending does not mean a happy ending, or even a better world than previously existed. Huge (long overdue, IMHO) investments in the commodity markets in 2006-2009 are going to keep us going for another few decades until another cycle of underinvestment bites us again. However, each time the invisible hand flings money from one pot into another there is uncounted costs in disrupted lives, environmental impacts, and national upheaval. Capitalism is far from perfect, but--at least in terms of resource allocation in dynamic information-starved systems--its the least imperfect solution we've got.

Re: Exponential Economist Meets Finite Physicist (2012)

#48

Post by philipkglass »

jbotz wrote: post #44
evdev wrote: post #22

Earlier quoted context omitted.

https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&...

Huh, I sure put my foot in my mouth on that one... a rather big assumption I never checked. Recalibrating... But in my defense it's worth mentioning that globally it still seems to hold true. The fact that energy consumption stopped in rich countries is apparently mostly due to the fact that manufacturing, which is one of the most energy-intensive parts of the economy, moved to poorer countries. But since the rich co…

See my above reply to jbay808. If you include imports, CO2 emissions attributable to the US increase by 6%. Even with that 6% upward correction, primary energy consumption per capita in the US now is lower than it was in the 1970s.

Re: Exponential Economist Meets Finite Physicist (2012)

#49

Post by ThrustVectoring »

age_bronze wrote: post #30

There's an underlying assumption that economical growth has anything to do with physical limits. Economical growth is a lie we tell ourselves so that innovation has its incentives, while everything else that's there because it must be there (because it will always have a demand), such as energy (but also food, real estate, etc.) just piggybacks with a similar 'fake growth' that really arises only from the fact these…

The less cynical interpretation is that "real goods and services" captures the value people derive from them, rather than some objective measure like "energy consumption". There's no innate reason why we can't figure out more and more valuable ways to do things pretty much indefinitely.

Re: Exponential Economist Meets Finite Physicist (2012)

#50

Post by Gibbon1 »

Chathamization wrote: post #24

> per-capita energy use has surged dramatically over time Per capita energy use seems to be declining in advanced economies[1]. > But if energy became arbitrarily cheap, someone could buy all of it, and suddenly the activities that comprise the economy would grind to a halt...There will be a floor to how low energy prices can go as a fraction of GDP. That seems to be a bizarre understanding of how the economy works.…

> Per capita energy use seems to be declining in advanced economies[1].

Yeah we moved a bunch of heavy industry to China and switched to low carbon finance.

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