SL Economic Systems

[Unca Avro]

Are there any SL worlds that are trying out different economic systems? Such as the Star Trek future? Or a Native American style Gifting Culture?

[Love Zhaoying]

16 minutes ago, Unca Avro said:

Are there any SL worlds that are trying out different economic systems? Such as the Star Trek future? 

I wonder what a world based on Star Trek would use, since the "Federation" itself doesn't use money?

Latinum, like the Ferengi?

Dilithium crystals (pre-"Burn")?

 

[Persephone Emerald]

There are roleplay game systems within SL that use their own currency, but linden dollars are the official currency in SL and the only one that can be directly exchanged for real money (currently only for US dollars, though the new exchange company may allow other currencies too).

Anyone in SL is free to exchange gifts, and many people do. If I help a creator by telling them about a problem with a vendor, they might give me a gift. If someone gives me a gift, I might give them something I've made in return. It's not unusual to give gifts to newbies, even a few linden dollars, to help them get started, or to offer No Copy transferable items in some groups. Free clothes and skins may be available at the entry points of roleplay sims. There are numerous freebie places and free gifts available at stores.

I think gift exchange and generosity in general are very common customs in SL, so much so that one can get by without spending much money if one wishes. Creators of content usually want to make a profit and get compensation for their work, but the fact that we can make an item once and then sell or give away copies indefinitely makes it easy to be generous too.

[Love Zhaoying]

Idea: Nuka Cola caps. (Like in Fallout.)

[Unca Avro]

As I understand it Star Trek's industry has outstripped scarcity and with Replicators and Anti-matter all the population's basic needs are met at nearly free. Various careers are directed at the individual's skills and predilections. There is still an exchange economy but it tends to be of things like art works, handicrafts, scientific discoveries, antique collectibles, and personal services, exchanged for same.

Native American Gift Economies were typefied by the potlatch where participants competed with one another in giving their possessions to the needy. Chiefs were chosen not just on leadership capabilities but for year round generosity.

Nothing like that?

[Love Zhaoying]

1 minute ago, Unca Avro said:

As I understand it Star Trek's industry has outstripped scarcity and with Replicators and Anti-matter all the population's basic needs are met at nearly free. Various careers are directed at the individual's skills and predilections. There is still an exchange economy but it tends to be of things like art works, handicrafts, scientific discoveries, antique collectibles, and personal services, exchanged for same.

This is why I mentioned Latinum and the Ferengi - while the Federation itself may have "conquered scarcity" and no longer "need money", the Ferengi are intentionally shown as a "throwback" culture that is the embodiment of "greed" (for "latinum").

[Persephone Emerald]

57 minutes ago, Unca Avro said:

As I understand it Star Trek's industry has outstripped scarcity and with Replicators and Anti-matter all the population's basic needs are met at nearly free. Various careers are directed at the individual's skills and predilections. There is still an exchange economy but it tends to be of things like art works, handicrafts, scientific discoveries, antique collectibles, and personal services, exchanged for same.

Native American Gift Economies were typefied by the potlatch where participants competed with one another in giving their possessions to the needy. Chiefs were chosen not just on leadership capabilities but for year round generosity.

Nothing like that?

As in RL, I think there are pockets in the Star Trek universe where people are relatively comfortable, but this is not a universal condition and isn't even always the case within the Federation. If you look at descriptions of life on Earth, in its colonies, and in the Federation at different times, there have also been times of war and famine. 

I like the idea of a world in which everyone is safe and comfortable, where there is no greed, and everyone is free to do as they wish for their work and in their leisure time, but I don't think this is probably a sustainable condition. There are always outside forces and internal conflicts of some kind to disturb the status quo.

Edited April 29 by Persephone Emerald

[Bubblesort Triskaidekaphobia]

On 4/29/2024 at 1:37 PM, Unca Avro said:

Native American Gift Economies were typefied by the potlatch where participants competed with one another in giving their possessions to the needy. Chiefs were chosen not just on leadership capabilities but for year round generosity.

Good to meet another fan of David Graeber!

For those unfamiliar:  Graeber was a brilliant anthropologist (well, I think he was brilliant), who wrote about this kind of thing extensively.  Basically, he showed that there never was a barter economy.  We have all been taught that before money there was barter, but it just isn't true.  Before we had money, barter was a rare thing that happened with strangers, and foreigners, and sometimes, like with the aboriginal tribes, it involved elaborate, religious inter-tribal rituals.  Ancient, pre-currency economies were based on gifts, which means people would give each other stuff based on their need, and social standing, connections, traditions, and their own need for higher social standing.  This didn't just happen with Native Americans.  It's a universal thing, that happened across Celts, native Americans, in India, China, etc.  It's all very complicated when you start asking why people are doing this, but the evidence is clear that this is what happened.

I think the best way to explain this kind of transaction to modern humans is to think about dating and families.  When a man's date wants a cocktail, it's common for the man to buy it for her.  He doesn't say "I'll trade you a cocktail for a beer," or make out an invoice for her to pay him back, with interest.  He just buys her the cocktail.  That's the expectation for the default behavior on a date, unless they explicitly negotiated going dutch ahead of time.  Also, when a child is hungry, one of the parents feeds them.  We don't tally up the amount spent on these things, and demand payment later.  Nobody is threatening to evict their deadbeat toddler for not paying for their dinner last week.  These things are gifts, and we give them for many reasons, including social standing, social connections, and tradition.

Many economists take issue with Graeber's economic arguments, partly because Graeber was very liberal (he's credited with founding Occupy Wall St).  I haven't seen a serious academic take issue with his anthropology, though.  It seems settled that he is historically correct.

I have seen nothing like these ancient gift economies in SL.  I think it would be difficult to get enough people who can wrap their heads around the ideas involved enough to pull it off.

Also, there's the problem of where stuff comes from now.  When everybody purchases everything with lindens, they expect to exchange everything for lindens.  Also, lindens are currently the only way for most people in SL to get stuff.  Things may have been different years ago, when everybody in SL made things, but nowadays, most people probably can't rez a box prim deliberately.  It would probably be easier if we all made stuff and traded it.

I think maybe trying this out at Burning Life would be the best way to try it.  IRL, they don't use currency at Burning Man, so why do we use lindens at Burning Life?

I have never been picked to volunteer at Burning Life, though, so IDK how that festival works.

Edited April 30 by Bubblesort Triskaidekaphobia
clarified that this happens across cultures

[Persephone Emerald]

2 hours ago, Bubblesort Triskaidekaphobia said:

Good to meet another fan of David Graeber!

For those unfamiliar:  Graeber was a brilliant anthropologist (well, I think he was brilliant), who wrote about this kind of thing extensively.  Basically, he showed that there never was a barter economy.  We have all been taught that before money there was barter, but it just isn't true.  Before we had money, barter was a rare thing that happened with strangers, and foreigners, and sometimes, like with the aboriginal tribes, it involved elaborate, religious inter-tribal rituals.  Ancient, pre-currency economies were based on gifts, which means people would give each other stuff based on their need, and social standing, connections, traditions, and their own need for higher social standing.  This didn't just happen with Native Americans.  It's a universal thing, that happened across Celts, native Americans, in India, China, etc.  It's all very complicated when you start asking why people are doing this, but the evidence is clear that this is what happened.

I think the best way to explain this kind of transaction to modern humans is to think about dating and families.  When a man's date wants a cocktail, it's common for the man to buy it for her.  He doesn't say "I'll trade you a cocktail for a beer," or make out an invoice for her to pay him back, with interest.  He just buys her the cocktail.  That's the expectation for the default behavior on a date, unless they explicitly negotiated going dutch ahead of time.  Also, when a child is hungry, one of the parents feeds them.  We don't tally up the amount spent on these things, and demand payment later.  Nobody is threatening to evict their deadbeat toddler for not paying for their dinner last week.  These things are gifts, and we give them for many reasons, including social standing, social connections, and tradition.

Many economists take issue with Graeber's economic arguments, partly because Graeber was very liberal (he's credited with founding Occupy Wall St).  I haven't seen a serious academic take issue with his anthropology, though.  It seems settled that he is historically correct.

I have seen nothing like these ancient gift economies in SL.  I think it would be difficult to get enough people who can wrap their heads around the ideas involved enough to pull it off.

Also, there's the problem of where stuff comes from now.  When everybody purchases everything with lindens, they expect to exchange everything for lindens.  Also, lindens are currently the only way for most people in SL to get stuff.  Things may have been different years ago, when everybody in SL made things, but nowadays, most people probably can't rez a box prim deliberately.  It would probably be easier if we all made stuff and traded it.

I think maybe trying this out at Burning Life would be the best way to try it.  IRL, they don't use currency at Burning Man, so why do we use lindens at Burning Life?

I have never been picked to volunteer at Burning Life, though, so IDK how that festival works.

What? Other people's parents don't say, "I carried you in my belly for 9 months, I put a roof over your head and fed you. Why can't you give me money when I need it to pay my bills? Do you want me to loose my house or starve?" (I'm paraphrasing for effect.)

I think also they should make it against the rules to exchange lindens at Burning Life, except as donations. I don't think they sell much there now as it is.

[Bree Giffen]

A barter economy would be interesting to see at Burning Life or some other event.  Vendors would have to give away limited quantities of no copy/transfer items. People would have to barter with items they were able to get. People might start offering payments to acquire items instead of bartering. It could get messy.

[Persephone Emerald]

49 minutes ago, Bree Giffen said:

A barter economy would be interesting to see at Burning Life or some other event.  Vendors would have to give away limited quantities of no copy/transfer items. People would have to barter with items they were able to get. People might start offering payments to acquire items instead of bartering. It could get messy.

There's a volunteer event in my city called a goblin market. It's put on by small-time artists and creative folks about once a month in good weather. Rather than accepting money, vendors trade their wares and services for various things. You might give them a recipe, an interesting object, sing a song, or recite a poem. The location is revealed first with clues, then finally the actual location. I haven't been yet, but it sounds fun.

[Love Zhaoying]

Is the "Slex for L$" economy barter, or a Service economy?

[Persephone Emerald]

20 minutes ago, Love Zhaoying said:

Is the "Slex for L$" economy barter, or a Service economy?

That's a service economy

 

[Prokofy Neva]

On 4/29/2024 at 1:37 PM, Unca Avro said:

As I understand it Star Trek's industry has outstripped scarcity and with Replicators and Anti-matter all the population's basic needs are met at nearly free. Various careers are directed at the individual's skills and predilections. There is still an exchange economy but it tends to be of things like art works, handicrafts, scientific discoveries, antique collectibles, and personal services, exchanged for same.

Native American Gift Economies were typefied by the potlatch where participants competed with one another in giving their possessions to the needy. Chiefs were chosen not just on leadership capabilities but for year round generosity.

Nothing like that?

If this lovely utopia were really true and effective, no Native American tribe would ever have to go to war with any other tribe. And yet they were constantly at war with each other. And they warred for territory and influence, which you don't mention in your lovely scenario, which they needed for hunting to survive and for farming (some tribes did have crops).

Life is more complicated that economic systems devised by people on the Internet who don't live them. 

[Love Zhaoying]

What would one barter to purchase something in Second Life (besides Slex)?

- Advertising

- Blogging

- Trade "in kind" (give the creator a thing they want)

- Leads of potential customers, vendors, etc.

- Free or discounted Rent or other Services

 

 

[Paul Hexem]

6 hours ago, Love Zhaoying said:

What would one barter to purchase something in Second Life (besides Slex)?

- Advertising

- Blogging

- Trade "in kind" (give the creator a thing they want)

- Leads of potential customers, vendors, etc.

- Free or discounted Rent or other Services

I used to script all sorts of stuff for a club (tip jars, security stuff, timeclock systems, etc) and in turn they gave me a parcel on their region as my workshop. Does that count?

[Love Zhaoying]

8 minutes ago, Paul Hexem said:

I used to script all sorts of stuff for a club (tip jars, security stuff, timeclock systems, etc) and in turn they gave me a parcel on their region as my workshop. Does that count?

Yep! "Trade in kind", by my reckoning. Or "services".

[Qie Niangao]

On 4/29/2024 at 1:37 PM, Unca Avro said:

As I understand it Star Trek's industry has outstripped scarcity…

In RL, Changpeng Zhao, founder of Binance and sentenced yesterday to four months in prison for money laundering, is probably the wealthiest person in the world, based on a global empire of absolutely nothing but precisely provable scarcity.

Truth is stranger than Star Trek.

(No idea how one could emulate such a crazy system in SL. Nor why.)

[Love Zhaoying]

I keep thinking we need some commodity in SL like "Nuka Cola Caps" (used as currency in Fallout). 

It would have to be some kind of "uncopyable" Gacha-like item.

 

[Qie Niangao]

12 minutes ago, Love Zhaoying said:

I keep thinking we need some commodity in SL like "Nuka Cola Caps" (used as currency in Fallout). 

It would have to be some kind of "uncopyable" Gacha-like item.

To be interesting, they'd need to have some in-game appeal, like you could "buy" some role-played goods and services with them.

But if they have appeal, eventually somebody will offer to buy them with OOC currency (L$s, £s, ¥s, etc) and before you know it there'll be an exchange, and Caps hedgefunds, Caps volatility futures, FinCen reporting, convictions for money laundering…

[Bubblesort Triskaidekaphobia]

21 hours ago, Persephone Emerald said:

What? Other people's parents don't say, "I carried you in my belly for 9 months, I put a roof over your head and fed you. Why can't you give me money when I need it to pay my bills? Do you want me to loose my house or starve?" (I'm paraphrasing for effect.)

... and that is where debt comes from.  Sacred debt, even.  That's a much deeper subject.  Your debt to family and society can become a type of original sin, that underpins some major religions.  Just one example:  To this day, financialized debt is used in India to prop up the caste system, when the poor are made to go into debt in order to get married.  Taxes can be justified by the idea of paying this debt to society.  Once people have this concept of debt, it's not a big leap to invent currency.

If somebody gives you a cow, you can't pay them back with a whole cow.  If you could, you wouldn't need the cow in the first place, so they would not have given you the cow in a gift economy, where everybody in town knows each other, and the idea of explicitly repaying a gift is insulting.  In a debt economy, though, you must pay them back.  Over time.  With interest, preferably.  Modern humans feel that it is immoral to not pay them back.  So how do you pay them back?  You can try barter, but it's awkward.  You can give them a porterhouse steak every week, until the weight of the steaks adds up to an entire cow?  Probably not.  You could repay in chickens, maybe.  Currency seems to be the easiest way to do it, though.  Currency also seems to be the easiest way to quantify income, and levy taxes as a portion of that income.  It is an elegant solution, that solves a lot of problems at once.

It's been years since I read 'Debt:  The First 5000 Years,' so I may have gotten some details wrong, but IIRC, that's Graeber's story of where money comes from.  Gifts lead to debt, which leads to currency.  Barter is a temporary solution, that only ever seems to happen for short periods, when currency breaks down for some reason (failed state, hyperinflation, etc).

[Persephone Emerald]

1 hour ago, Love Zhaoying said:

I keep thinking we need some commodity in SL like "Nuka Cola Caps" (used as currency in Fallout). 

It would have to be some kind of "uncopyable" Gacha-like item.

Unless it's necessary for a game one is actively playing, nobody wants that crap in their inventory.

(I still have food items and old salvage from the Wastelands and 7Seas Fishing, though.)

[Persephone Emerald]

1 hour ago, Bubblesort Triskaidekaphobia said:

... and that is where debt comes from.  Sacred debt, even.  That's a much deeper subject.  Your debt to family and society can become a type of original sin, that underpins some major religions.  Just one example:  To this day, financialized debt is used in India to prop up the caste system, when the poor are made to go into debt in order to get married.  Taxes can be justified by the idea of paying this debt to society.  Once people have this concept of debt, it's not a big leap to invent currency.

If somebody gives you a cow, you can't pay them back with a whole cow.  If you could, you wouldn't need the cow in the first place, so they would not have given you the cow in a gift economy, where everybody in town knows each other, and the idea of explicitly repaying a gift is insulting.  In a debt economy, though, you must pay them back.  Over time.  With interest, preferably.  Modern humans feel that it is immoral to not pay them back.  So how do you pay them back?  You can try barter, but it's awkward.  You can give them a porterhouse steak every week, until the weight of the steaks adds up to an entire cow?  Probably not.  You could repay in chickens, maybe.  Currency seems to be the easiest way to do it, though.  Currency also seems to be the easiest way to quantify income, and levy taxes as a portion of that income.  It is an elegant solution, that solves a lot of problems at once.

It's been years since I read 'Debt:  The First 5000 Years,' so I may have gotten some details wrong, but IIRC, that's Graeber's story of where money comes from.  Gifts lead to debt, which leads to currency.  Barter is a temporary solution, that only ever seems to happen for short periods, when currency breaks down for some reason (failed state, hyperinflation, etc).

Value and debt are interesting concepts. 

We believe it's a fair traid of 40 hours/ week or more of our time and energy to get paid a paycheck. Yet why is the time and energy of some people more valuable than the time and energy of others? 

Might we at some point feel like our employer owes us for all the years of our life we've given them? I think this was where the concept of medical and retirement benefits, as well as Social Security, started.

Edited May 1 by Persephone Emerald

[Unca Avro]

Interesting...yet SL is clearly a gift economy overprinted with a monetary exchange system...No one charged me for my Avatar. People spend years creating incredible unique island universes and there is no ticket booth at the entrance. I tip the DJs from time to time, but if I didn't no one would turn off the music or kick me out of the club. The answer is that those of us who wander SL looking for adventure contribute critical service to the whole. It simply isn't metered.

My question is essentially about SLs ability to re-construct your state of mind. It is becoming a valuable interface between the teacher and the student. Capitalism is a state of mind. So is Communism, and the Gift Economy. I like to speculate on what an economy based entirely on generosity and compassion might look like, and how SL might go about modeling it.

[Zalificent Corvinus]

1 hour ago, Unca Avro said:

I like to speculate on what an economy based entirely on generosity and compassion might look like, and how SL might go about modeling it.

It would look like one of those "middle class hippie wannabe" Fail-Communes, filled with insincere people indulging in very public displays of fake Virtue Signalling.

 

A bit like those Celebrities, who give money to homeless people, but only when they have three personal assistants on hand, one to hold the video camera, one to hold the box of disinfectant hand wipes in case the celeb TOUCHES a poor person by accident, and one to count each $1 handout, so the celeb's accountant can claim it as a "Tax deducttable Charity Donation" against their multi million dollar fortune.

 

1 hour ago, Unca Avro said:

My question is essentially about SLs ability to re-construct your state of mind. It is becoming a valuable interface between the teacher and the student.

That sounds like a classic example of the kind of "middle class hippie wannabe" claptrap you find in those Fail-Communes to me.