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The Theory of Interstellar Trade (1978)

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Re: The Theory of Interstellar Trade (1978)

#31

Post by cultus »

hsnewman wrote: post #24

This seems to be a joke, it says it was funded with a grant from William Proxmire, an american politician that started the "Golden Fleece awards".

It's probably just that they wrote this for fun because I can't imagine anyone would fund it. Economists use a surprising amount of dry humor like that, I've noticed.

An old one:

  Remember the unfortunate econometrician, who, in one of the major functions of his system, had to use a proxy for risk and a dummy* for sex.
*(a discrete dependent variable)

Re: The Theory of Interstellar Trade (1978)

#32

Post by generalizations »

koheripbal wrote: post #14
messe wrote: post #2

Abstract: > This paper extends interplanetary trade to an interstellar setting. It is chiefly concerned with the following question: How should interest on goods in tranist be computed when the goods travel at close to the speed of light? This is a problem because the time taken in transit will appear less to an observer travelling with the goods than to a stationary observer. A solution is derived from economic theo…

I'm trying to imagine a physical product that is worth transporting on an interstellar level, rather than locally manufactured. It seems to me that the only thing that would ever be exchanged between solar systems, would be information.

If we cannot assume the distribution of elements across solar systems is homogenous, I imagine there might be some other system largely composed of heavy or noble elements we have a hard time obtaining locally.

Edit: come to think of it, interstellar trade might become necessary once we start building at larger scales - moon sized space stations, asteroid-sized interstellar ships, etc. That's a lot of material to mine, and it might be easier to import it.

Re: The Theory of Interstellar Trade (1978)

#33

Post by mmhsieh »

I realize that Krugman was being tongue in cheek in this work, but a lot of the work in theory-heavy areas of "mathematical" economics are similar exercises in obscurity and dubious scientific value.

Krugman, in one of his autobiographical essays, described economics as the field that people get into when they can't hack it in math, physics or some other high-rigor STEM field. Part of proving one's intelligence as a junior economics faculty member is doing a lot of mathematically-heavy fireworks and then moving on to "real" research that matters.

We can laugh at this one but what is not laughable is the huge resource cost in supporting an academic economics establishment (at least in the theory area) whose product is actually not that much different from this.

Re: The Theory of Interstellar Trade (1978)

#34

Post by [deleted] »

dmurray wrote: post #7
jagged-chisel wrote: post #3

Earlier quoted context omitted.

Without having read anything but your comment: The economic impact to the attendant ('observer travelling with the goods') is not diminished by his own experience of the passage of time, but is affected by the reduction in his own ability to take on other tasks during the same [external] time frame. In other words, it doesn't matter that he experienced the travel as five minutes. What matters is that his options were…

But his needs (food, shelter,...) only had to be met for 5 minutes, while he could have invested money and earned interest for 5 days. This is a minor plot point in Orson Scott Card's Ender series, and in Futurama .

[deleted]

Re: The Theory of Interstellar Trade (1978)

#35

Post by vsareto »

jagged-chisel wrote: post #3
messe wrote: post #2

Abstract: > This paper extends interplanetary trade to an interstellar setting. It is chiefly concerned with the following question: How should interest on goods in tranist be computed when the goods travel at close to the speed of light? This is a problem because the time taken in transit will appear less to an observer travelling with the goods than to a stationary observer. A solution is derived from economic theo…

Without having read anything but your comment: The economic impact to the attendant ('observer travelling with the goods') is not diminished by his own experience of the passage of time, but is affected by the reduction in his own ability to take on other tasks during the same [external] time frame. In other words, it doesn't matter that he experienced the travel as five minutes. What matters is that his options were…

We can turn this on its head and ask a similarly tricky question: Should a human that can live for 1000 years be allowed to access interest rates that 100 year humans get?

A 1,000 year human has many more opportunities, and compounding interest will only grow his wealth further. Here's only an initial $1000 investment over 1000 years:

https://www.calculator.net/interest-calculator.html?cstartin...

At the end of it, they have $358,816,... a huge amount of money.

By year 730, they're quintillionaires. Then they have roughly 270 years to spend it, and on top of that, they can hand some of that wealth off to their offspring if inheritance rules don't change. (So really, it's the subsequent generations you really have to worry about)

Near light travel time dilation is essentially life extension relative to planetary populations. So any interest paid to the traveler should be calculated at the fraction of time experienced, so 5 minutes to 5 days would be 1 / 1440.

As for any opportunity cost, well, there really isn't any greater opportunity cost than being able to extend your life by that much and wait for interest to accrue. So by virtue of being able to travel at near light speed and dilate time, you're quite happy to forgo every other opportunity.

Re: The Theory of Interstellar Trade (1978)

#36

Post by bschne »

mmhsieh wrote: post #33

I realize that Krugman was being tongue in cheek in this work, but a lot of the work in theory-heavy areas of "mathematical" economics are similar exercises in obscurity and dubious scientific value. Krugman, in one of his autobiographical essays, described economics as the field that people get into when they can't hack it in math, physics or some other high-rigor STEM field. Part of proving one's intelligence as a…

Do you happen to have a link / title for this essay?

Re: The Theory of Interstellar Trade (1978)

#37

Post by mmhsieh »

bschne wrote: post #36
mmhsieh wrote: post #33

I realize that Krugman was being tongue in cheek in this work, but a lot of the work in theory-heavy areas of "mathematical" economics are similar exercises in obscurity and dubious scientific value. Krugman, in one of his autobiographical essays, described economics as the field that people get into when they can't hack it in math, physics or some other high-rigor STEM field. Part of proving one's intelligence as a…

Do you happen to have a link / title for this essay?

I would welcome someone to help me look for this. I read many of his online essays around 2001, and don't think they were part of any formal publication.

Re: The Theory of Interstellar Trade (1978)

#38

Post by treeman79 »

forgingahead wrote: post #30
koheripbal wrote: post #14

Earlier quoted context omitted.

I'm trying to imagine a physical product that is worth transporting on an interstellar level, rather than locally manufactured. It seems to me that the only thing that would ever be exchanged between solar systems, would be information.

Wait until we have Galactic Economics and other voodoo fields of study* , and beings start being convinced of "specialisation" on a cosmic scale. *Not unlike it's current-day counterpart, Macroeconomics.

Maybe proprietary nano-machines that make one immortal.

Not much that’s going to worth the high cost. Assume the cost could ever even be paid.

Re: The Theory of Interstellar Trade (1978)

#40

Post by Ekaros »

koheripbal wrote: post #14
messe wrote: post #2

Abstract: > This paper extends interplanetary trade to an interstellar setting. It is chiefly concerned with the following question: How should interest on goods in tranist be computed when the goods travel at close to the speed of light? This is a problem because the time taken in transit will appear less to an observer travelling with the goods than to a stationary observer. A solution is derived from economic theo…

I'm trying to imagine a physical product that is worth transporting on an interstellar level, rather than locally manufactured. It seems to me that the only thing that would ever be exchanged between solar systems, would be information.

Also leads to questions of development. How long until anything you ship is considered obsolete. On systems close by things aren't so bad if we are talking of a few years. But with tens of years, whole thing comes rather questionable. It is old tech when it arrives, and I can't even imagine the lead times.

On other hand new "new old stock", is quite interesting proposition. As items would be old stock, but still in brand new non-aged condition. So spare parts with limited life-span and lowish demand or complex manufacturing process might be the answer...

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