The Azimuth Project
Utopia (Rev #2)

The below is a first draft for a game with the working title “Utopia”, it was first proposed at the randform blog post at http://www.randform.org/blog/?p=2312

It was motivated by the question: “How can one set up an investment scheme (in a game like environment) which encourages investments into ventures with from the outset low return or even no return?”

Assume we have a kind of Sims game that is sort of a real life economic scenario. Could it be supplied with a different system of money distribution and storage than with the usual banking and economical scheme, in particular the system should be able to encourage investments into ventures with no return, but which are desired for technological and societal reasons? If yes – What could be possible? What can one think of?

Here – a very incomplete and rough (and probably not working) scheme as a start, which is mainly intended to encourage brainstorming about these issues rather than provide a solution.

Starting from the crucial point that surplusses are needed for investments, lets assume there exists a certain amount of surplus. In the game that surplus is just a fixed start amount of extra money. In reality and within a country one could find such a surplus in all assets which are not unconditionally needed for covering the running costs. Its a debatable point what these are, but in richer countries one can find a surplus. Or coltishly put: Schloss Neuschwanstein could a priori be liquidized. In some sense a countries surplus is an indicator of how a country florishes. If there is no surplus and if even running costs cant be covered a country is usually considered to be bankrupt.

Now a surplus could be in total centrally distributed by a government. However similar real life experiments like in a centrally planned economy showed that this was economically less successful. Nevertheless it is meanwhile also rather undisputed that governments or other societal institutions should be able to exert an influence on the distribution of surplusses.

Hence lets e.g. assume that the given surplus is evenly distributed among the participants (in order to give the most democratic chance of investment and in order to mitigate the problem of lazy riches).

Impose the rule that any personal surplus has to be spend within a short time span into various (short and long term) investments (so money has to be invested). The investments have to promise “benefits” that is either one can collect benificiary points (being e.g. issued by societal institutions prior to investment) for investments into ventures with low or no return or one can collect money returns. For the work which is related to the distribution of the surplus each participant gets a “wage” which can be used for one’s own consumption. The wage is dependend on the success of the investments. If an investment yields no return or no beneficiary points or worse if even the investment is lost then the participant is “punished”. E.g. in the worst case that is if the whole surplus is lost then the participant is punished with “getting no wage from surplus”. The actual size and dependency of the wage with respect to the earned returns and/or beneficiary points is thus an important parameter.

All made returns and beneficiary points enter the personal surplus and have to be reinvested. A venture may store collected investment and eventually issue interests until the needed lump sum is collected that would accomodate for the storage effect of banks.

It may be also be good to allow only for investments which are not ones own investments. This would e.g. encourage long-term investments, since the surplus could anyways not be spend on ones own projects and thus accomodate at least partially for the intermediation function of banks.

Note that the distribution of beneficiary points is also an important parameter. (please see also this randform post about assigning values) In particular beneficiary points may be distributed to such different things as newcomer bands, extraordinary social activities/aid or research in quantum gravity.

With this concept one can eventually tackle also other aspects which aren’t yet yet formulated, like eventually a different role of jobs: http://www.randform.org/blog/?p=2635 (i.e. people are more paid the more unpleasant, strenous, dangerous etc. the job is) and a different approach to patents (i.e. for example the risk to develop a new idea could not only be carried by one or few entrepreneurs as nowadays (who then demand high license fees), but could be seen as a “venture” from the onset on, which yields beneficiary innovation Utopia-points. In such a way for example two companies could more or less (the “more or less” is of course a not so easy point) fairly share development costs, instead of having the patents “the-winner-takes-it-all-principle” . The beneficiary innovation points could eventually come partially from government surplusses (substituting somewhat innovation subventions), an industries innovation pool (everybody may profit from innovation) and individuals a.s.o. ).