Friday, April 11, 2014

Flowcilitation

"Flow Facilitation" - 8,210 results
"Flowcilitation" - 2 results
"Flowcilation" - 0 results

If a concept is important then you really don't want to force people to wade through a swamp of irrelevant search results (ie tax choice vs pragmatarianism).  If you want somebody to find the needle, then don't put it in a haystack.  If the needle is already in a haystack, then endeavor to remove it by giving it a unique ID.

Is flowcilitation an important concept?  Yes, very yes.  Facilitating the flow of input improves the answer to the fundamental question... how should society's limited resources be used?

But not all input is equally valuable though.  I have to warn you that the following example might blow your mind.  On Reddit (a flowcilitator), in the econ subreddit, I saw this link that ellak12 shared...




The Huffington Post interview with the economist Ha-Joon Chang had received 897 upvotes and 219 downvotes.

Here's what I found when I read the interview...
So there is no economic theory that actually says that you shouldn’t have slavery or child labour because all these are political, ethical judgments. - Ha-Joon Chang
Was your mind blown?  It really should have been.

There were 897 people who freely gave their positive input to an economist who said that there's isn't an economic theory that defends people's freedom to give input.  Yeah...this is exactly why shallow input should never trump deep input.

Just because shallow input should never trump deep input doesn't mean that we should eliminate shallow input.  Shallow input is extremely useful.  In this case it highlights a huge problem: 80% of people who are interested in economics...and even some professional economists...don't know that there are very strong economic arguments against slavery.  This problem should really scare you because the moral arguments against slavery, by comparison, are extremely weak.  If we want to avoid slavery...then it would really behoove us to ensure that each and every member of each and every society knows the strongest arguments against slavery.

First, incentives matter.  Slaves lack the incentive to maximize their productivity...
Land occupied by such tenants is properly cultivated at the expence of the proprietor as much as that occupied by slaves. There is, however, one very essential difference between them. Such tenants, being freemen, are capable of acquiring property, and having a certain proportion of the produce of the land, they have a plain interest that the whole produce should be as great as possible, in order that their own proportion may be so. A slave, on the contrary, who can acquire nothing but his maintenance, consults his own ease by making the land produce as little as possible over and above that maintenance. - Adam Smith, Wealth of Nations
But if great improvements are seldom to be expected from great proprietors, they are least of all to be expected when they employ slaves for their workmen. The experience of all ages and nations, I believe, demonstrates that the work done by slaves, though it appears to cost only their maintenance, is in the end the dearest of any. A person who can acquire no property, can have no other interest but to eat as much, and to labour as little as possible. Whatever work he does beyond what is sufficient to purchase his own maintenance can be squeezed out of him by violence only, and not by any interest of his own. In ancient Italy, how much the cultivation of corn degenerated, how unprofitable it became to the master when it fell under the management of slaves, is remarked by both Pliny and Columella. In the time of Aristotle it had not been much better in ancient Greece. Speaking of the ideal republic described in the laws of Plato, to maintain five thousand idle men (the number of warriors supposed necessary for its defence) together with their women and servants, would require, he says, a territory of boundless extent and fertility, like the plains of Babylon. - Adam Smith, Wealth of Nations
...and it follows that they lack the incentive to innovate...
Slaves, however, are very seldom inventive; and all the most important improvements, either in machinery, or in the arrangement and distribution of work which facilitate and abridge labour, have been the discoveries of freemen. - Adam Smith, Wealth of Nations
More marionettes means less progress.

Second, input matters.  Slaves, by definition, are blocked from sharing their input on the question of how society's limited resources should be used.  The more input that's blocked, the less correct/valuable the answer will be.

Understanding the importance of incentives and input will help you understand why there's such a significant outcome disparity between command economies and market economies.

Here are a couple relevant comments on flowcilitation.  The first is one that I shared on Daniel M. Rothschild's article...How Uber and Airbnb Resurrect ‘Dead Capital’

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It's so much easier to comment on articles than it used to be. Just like it's so much easier to have articles published than it used to be. It's easier for input to flow. Flow is facilitated.

Command economies fail because input is blocked. Markets succeed because input is not blocked. But clearly, when it comes to facilitating flow, there's always room for improvement.

Crowdfunding isn't a recent phenomenon...but crowdfunding websites are. They make it extremely easy to share your deep input on commercial and civic endeavors. Therefore, they are flow facilitators.

What about creating a market in the public sector (pragmatarianism)? How much flow would be facilitated? It would be a flood of input. Yet, it only has 60 likes on facebook. Where's the bottleneck?

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Next comment was on this article...The Market: The Only Trustworthy Pollster by Donald Boudreaux...

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Excellent article! It's fundamentally important to help people understand this concept. But I'm thinking that it's only one half of the story...

First half: Votes don't accurately reveal what people actually want.
Second half: Voting for what you don't actually want can shift resources away from the things that you truly want. The genie might grant your wishes...but you'll be worse off if he does. The logical result of granting voters' wishes is that we end up with more of the things that we don't actually want and less of the things that we truly want.

If shallow input (voting) doesn't adversely impact the allocation of resources...then there's absolutely nothing wrong with it.

The first half of the story is essential...but the second half is far more compelling. It's the punch line. Unfortunately, perhaps it's not the easiest thing to illustrate.

We all voted for a Lexus and the result is a shortage of food? The resources required to provide everybody with a "free" Lexus had to come from somewhere. And it stands to reason that they were taken from the things that we value more than a fancy ride. So we're definitely worse off when our ballot votes (shallow input) are allowed to trump our dollar votes (deep input).

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Ballot voting, Reddit votes, Facebook likes and Youtube thumbs up/down are all examples of shallow flowcilitation.  These flowcilitators give us insight into people's opinions, feelings and sentiments.  This insight is extremely superficial.  It's the tip of the iceberg.  It's the cover of a book.  Dollar voting, on the other hand, is an example of deep flowcilitation.  It gives us insight into people's values.  This insight is extremely deep.  Therefore, when it comes to answering the fundamental question of how society's limited resources should be used...shallow input should never trump deep input.

The fact that people do not have the freedom to choose where their taxes go reflects the fact that the vast majority of people are not aware of the strong economic arguments against blocking input.

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