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Jeff Bezos’s Master Plan

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Re: Jeff Bezos’s Master Plan

#81

Post by me_me_me »

morningseagulls wrote: post #2

I like this detour into economics: > Bezos’s enterprise upends long-held precepts about the fundamental nature of capitalism—especially an idea enshrined by the great Austrian economist Friedrich Hayek[, who] argued that no bureaucracy could ever match the miracle of markets, which spontaneously and efficiently aggregate the knowledge of a society. > Amazon, however, has acquired the God’s-eye view of the economy tha…

>> if Marxist revolutionaries ever seized power in the United States, they could nationalize Amazon and call it a day.

Isn't that an argument for Amazon is de-facto a monopoly at this stage?

Re: Jeff Bezos’s Master Plan

#82

Post by bwestergard »

morningseagulls wrote: post #2

I like this detour into economics: > Bezos’s enterprise upends long-held precepts about the fundamental nature of capitalism—especially an idea enshrined by the great Austrian economist Friedrich Hayek[, who] argued that no bureaucracy could ever match the miracle of markets, which spontaneously and efficiently aggregate the knowledge of a society. > Amazon, however, has acquired the God’s-eye view of the economy tha…

This argument - that Amazon prefigures a new Soviet-style planning - has been made sincerely. I’ve written a critique here: http://machineryquestion.com/notes/peoples-republic

Re: Jeff Bezos’s Master Plan

#83

Post by morningseagulls »

bwestergard wrote: post #82
morningseagulls wrote: post #2

I like this detour into economics: > Bezos’s enterprise upends long-held precepts about the fundamental nature of capitalism—especially an idea enshrined by the great Austrian economist Friedrich Hayek[, who] argued that no bureaucracy could ever match the miracle of markets, which spontaneously and efficiently aggregate the knowledge of a society. > Amazon, however, has acquired the God’s-eye view of the economy tha…

This argument - that Amazon prefigures a new Soviet-style planning - has been made sincerely. I’ve written a critique here: http://machineryquestion.com/notes/peoples-republic

>This argument - that Amazon prefigures a new Soviet-style planning - has been made sincerely.

Because there is evidence that Marxists had tried, and failed, to do what Amazon has now succeeded. Project Cybersyn comes to mind:

https://en.wikipedia.org/wiki/Project_Cybersyn

https://www.newstatesman.com/world/2018/08/project-cybersyn-...

However, what Amazon has done is just characteristic of "organized industries", which Hayek conceded in his essay, The Use of Knowledge in Society, as being a "halfway house" between Soviet-style planning and free markets.

Re: Jeff Bezos’s Master Plan

#84

Post by morningseagulls »

pdonis wrote: post #21
morningseagulls wrote: post #15

Earlier quoted context omitted.

>that part of the article misinterprets centralised planning. What it describes is the logistics of getting something from one place to another. I think it's worthwhile to re-read the passage I quoted: >Hayek[...] argued that no bureaucracy could ever match the miracle of markets, which spontaneously and efficiently aggregate the knowledge of a society. This isn't just about physical logistics. Hayek is arguing that…

> Hayek is arguing that no centralised agent has perfect information. The author is arguing that Amazon is approaching the stage when it would have perfect information about the consumers it serves. This statement in the article is a huge misstatement. First, Amazon only has information about the goods it sells. There are many things it doesn't sell, and many things that it can't sell. There are huge supply chains be…

>> Hayek is arguing that no centralised agent has perfect information. The author is arguing that Amazon is approaching the stage when it would have perfect information about the consumers it serves.

>This statement in the article is a huge misstatement.

At least blame the right person: me. The above statement is a paraphrase of what I thought the author's argument was.

>First, Amazon only has information about the goods it sells.

>There are huge supply chains behind the products it sells that it does not see.

And it is in the process of acquiring more information. Amazon isn't just a retailer anymore: its main source of operating income is now AWS[0]. Also, dredmorbius has pointed out[1] that Amazon is doing vertical integration with its Amazon Business offering[2].

>There are many things it doesn't sell, and many things that it can't sell.

This is irrelevant, because these "many things" exist in a market outside of Amazon's "jurisdiction". Even in the historical centrally planned economies, these "many things" also existed.

>There are also many things of value that are not exchanged with money.

And they are getting rarer and rarer, because monetisation is now the Great Project.

>In other words, it has exactly the information that Hayek says a market participant has, and no more: the price at which other market participants will buy whatever quantity of one's products are sold.

Actually, Amazon has more information than a single market participant has. Since it is the market because it is a marketplace-as-a-service, it has exactly the information that Hayek says the sum total of all market participants have. This invalidates Hayek's argument that no centralised agent can possibly collect that much information. This point is what I believe the author of the article is trying to make.

[0] https://www.zdnet.com/article/in-2018-aws-delivered-most-of-...

[1] https://news.ycombinator.com/item?id=21306655

[2] https://www.amazon.com/b2b/info/amazon-business

Re: Jeff Bezos’s Master Plan

#85

Post by morningseagulls »

andreilys wrote: post #28
morningseagulls wrote: post #5

Earlier quoted context omitted.

>That he's also a dewy-eyed Trekkie who rationalizes his greed with dreams of space colonization makes it even sillier. Space colonization is a form of greed: it's basically saying this world is not enough. So I don't see this as a rationalization: in fact, the article heavily suggests that his dream of space colonization was what led to his greed.

You could just as easily say that space colonization is the highest form of humanitarianism. If an extinction-level event occurs on earth, humanity can continue to flourish and populate the cosmos rather than go the way of the dinosaur.

>You could just as easily say that space colonization is the highest form of humanitarianism.

"Greed" and humanitarianism are not mutually exclusive. In fact, they can be mutually compatible, depending on what your definition of "greed" is.

From an economic point of view, humanitarianism can serve the economic "greed" of the rich that's often decried. This is because both of these can be rooted in the realisation that humans have intrinsic economic value, so that the loss of a human life represents a loss of a lifetime of economic value to society.

In the case of Bezos, it's quite clear from the article that his humanitarianism is intrinsically linked to his "greed":

>When Bezos describes these colonies—and presents artists’ renderings of them—he sounds almost rapturous. “This is Maui on its best day, all year long. No rain, no storms, no earthquakes.” Since the colonies would allow the human population to grow without any earthly constraints, the species would flourish like never before: “We can have a trillion humans in the solar system, which means we’d have a thousand Mozarts and a thousand Einsteins. This would be an incredible civilization.”

"We can have a trillion humans [...] This would be an incredible civilization." Sounds familiar? This is essentially the siren song of the Chinese market, magnified a thousandfold.

Re: Jeff Bezos’s Master Plan

#86

Post by morningseagulls »

pmoriarty wrote: post #24
morningseagulls wrote: post #2

I like this detour into economics: > Bezos’s enterprise upends long-held precepts about the fundamental nature of capitalism—especially an idea enshrined by the great Austrian economist Friedrich Hayek[, who] argued that no bureaucracy could ever match the miracle of markets, which spontaneously and efficiently aggregate the knowledge of a society. > Amazon, however, has acquired the God’s-eye view of the economy tha…

Alienation is a critical and central part of Marxist critique. To miss it is to misunderstand Marxism. Marxists could not call it a day after nationalizing Amazon because the people who make the goods that Amazon sells would still be alienated from the goods they produce, and Amazon's workers would still be alienated from the products of their own labor.

>Alienation is a critical and central part of Marxist critique. To miss it is to misunderstand Marxism.

I don't think the author meant that reference to Marxism as anything more than a rhetorical flourish. His target, in that context, was Hayek's argument from incredulity against central planning in The Use of Knowledge in Society.

>Marxists could not call it a day after nationalizing Amazon because the people who make the goods that Amazon sells would still be alienated from the goods they produce, and Amazon's workers would still be alienated from the products of their own labor.

As I understand it, this alienation -- as you've described it here -- seems to have its roots in the division of labour in society, which seems to me to pre-date industrial capitalism. If that's so, then the work of Marxists can never be done, because work itself would have to be totally eliminated for the division of labour to vanish.

Re: Jeff Bezos’s Master Plan

#87

Post by pdonis »

morningseagulls wrote: post #84
pdonis wrote: post #21

Earlier quoted context omitted.

> Hayek is arguing that no centralised agent has perfect information. The author is arguing that Amazon is approaching the stage when it would have perfect information about the consumers it serves. This statement in the article is a huge misstatement. First, Amazon only has information about the goods it sells. There are many things it doesn't sell, and many things that it can't sell. There are huge supply chains be…

>> Hayek is arguing that no centralised agent has perfect information. The author is arguing that Amazon is approaching the stage when it would have perfect information about the consumers it serves. >This statement in the article is a huge misstatement. At least blame the right person: me. The above statement is a paraphrase of what I thought the author's argument was. >First, Amazon only has information about the g…

> The above statement is a paraphrase of what I thought the author's argument was.

Fair enough.

> Amazon has more information than a single market participant has. Since it is the market because it is a marketplace-as-a-service, it has exactly the information that Hayek says the sum total of all market participants have.

No, it doesn't. It has all the information that a large market participant has--i.e., a market participant that has a very large number of transactions with a very large number of other market participants. Hayek was perfectly well aware that such market participants existed (after all, such participants existed in his day--for example, Standard Oil).

But Amazon's information is still limited to information that a market participant can have: namely, as I said, the prices at which the various goods it sells are sold. It does not have any more information than that. It has information about a lot more transactions than most other market participants, but the information it has about each transaction is the same as what the other participant in the transaction has, no more.

Re: Jeff Bezos’s Master Plan

#88

Post by pdonis »

morningseagulls wrote: post #84
pdonis wrote: post #21

Earlier quoted context omitted.

> Hayek is arguing that no centralised agent has perfect information. The author is arguing that Amazon is approaching the stage when it would have perfect information about the consumers it serves. This statement in the article is a huge misstatement. First, Amazon only has information about the goods it sells. There are many things it doesn't sell, and many things that it can't sell. There are huge supply chains be…

>> Hayek is arguing that no centralised agent has perfect information. The author is arguing that Amazon is approaching the stage when it would have perfect information about the consumers it serves. >This statement in the article is a huge misstatement. At least blame the right person: me. The above statement is a paraphrase of what I thought the author's argument was. >First, Amazon only has information about the g…

> it is a marketplace-as-a-service

To the extent this makes a difference, because of Amazon's efforts to monopolize various market segments by undercutting competition, it decreases the amount of information Amazon has about other market participants. A perfect monopolist, by setting monopoly prices, decreases the value of the price information it gets through transactions, because there are no other competitors offering the same goods at different prices to compare to, so the prices of the monopolist's transactions convey less information about the preferences of other market participants. That makes the market less efficient.

Re: Jeff Bezos’s Master Plan

#89

Post by [deleted] »

gdy wrote: post #80
sverige wrote: post #70

Earlier quoted context omitted.

Having spent a year homeless on the streets and sometimes on friends' couches, I would say 'Fuck you.' But that would be rude.

That's what I thought. No idea. And by the way, was that happening while you were working at Amazon?

[deleted]

Re: Jeff Bezos’s Master Plan

#90

Post by morningseagulls »

pdonis wrote: post #87
morningseagulls wrote: post #84

Earlier quoted context omitted.

>> Hayek is arguing that no centralised agent has perfect information. The author is arguing that Amazon is approaching the stage when it would have perfect information about the consumers it serves. >This statement in the article is a huge misstatement. At least blame the right person: me. The above statement is a paraphrase of what I thought the author's argument was. >First, Amazon only has information about the g…

> The above statement is a paraphrase of what I thought the author's argument was. Fair enough. > Amazon has more information than a single market participant has. Since it is the market because it is a marketplace-as-a-service, it has exactly the information that Hayek says the sum total of all market participants have. No, it doesn't. It has all the information that a large market participant has--i.e., a market pa…

>Hayek was perfectly well aware that such market participants existed (after all, such participants existed in his day--for example, Standard Oil).

And Hayek did mention monopolies or "coordinated industries" as a "halfway house" between centrally planned economies and free markets. Sure.

>But Amazon's information is still limited to information that a market participant can have: namely, as I said, the prices at which the various goods it sells are sold. It does not have any more information than that.

Actually, Amazon does collect and process information that a market participant wouldn't normally have: consumer preferences.

Hayek argued that a central planner wouldn't be able to suck up the decentralised information embodied in every market participant. However, what Amazon is doing is mining the data it has about a consumer's purchase history, as well as the responses the consumer gave to recommendations made by its recommender engine. That is a lot more information than what most market participants would normally have access to.

Now, Hayek has outlined what he thinks is needed to construct a "rational economic order" in the beginning of "The Use of Knowledge in Society":

1) "If we possess all the relevant information",

2) "if we can start out from a given system of preferences",

3) "if we command complete knowledge of available means".

Unlike the monopolies of old, which may have 1) to some extent, Amazon also has 2), and is trying to acquire 3) with its Amazon Business offering. So its capabilities are arguably an improvement over the capabilities of the old monopolies.

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