Nothing In Nature Works Quite Like Money
Jag Bhalla is an entrepreneur, inventor and writer. His current project is Errors We Live By, a series of short exoteric essays exposing errors in the big ideas running our lives, details at www.errorsweliveby.com. His last book was I'm Not Hanging Noodles On Your Ears, a surreptitious science gift book from National Geographic Books, details at www.hangingnoodles.com. That explains his twitter handle @hangingnoodles.
Nothing in nature works quite like money. Or seems as complex as an economy. I’d welcome counterexamples, but something seems fishy.
1. Here’s the usual big picture: Competitive markets allocate resources efficiently. Money stores value and enables market exchange. Those ideas rest on mathematical structures from 19th century physics.
2. “Energy in physics and utility in economics [are] fundamentally the same [mathematical] metaphor,” says Philip Mirowski. “Utility” is what customers seek, and money paid it’s only measure.
3. So money = energy? In physics the same amount of energy always accomplishes the same work—you get the same miles per gallon. Not with money, its “energy” (the work it can do) varies.
4. Energy can’t be created or destroyed, only transformed or leaked. But money-value often disappears (e.g. new car values plummeting on crossing dealer thresholds). Does anything equivalent happen in nature?
5. Efficiency in economics usually means (the “historically unfortunate”) “Pareto efficiency,” roughly that everything produced is sold. Sound efficient? That ignores garages and attics full of unused crap, and the 40% of food that’s bought but uneaten. Both meet Pareto efficient criteria.
6. Economists often ignore normal inefficiencies arising from “foibles” like impulse buying. But you know you buy imprudently and often misjudge utility.
7. “Market forces” are modeled as physics-like, e.g. resources flow like fluids from low-profit to high-profit uses—making musical toilets while many lack unmusical sanitation. But forces in physics have few factors compared to markets.
8. Perhaps economies resemble ecologies? Well, nothing in biology works like money either. Biology’s energy, food, is necessary but beyond some threshold, becomes unhealthy. All biological appetites have limits, but economists assume “local nonsatiation” (translation: we always want more).
9. Market competition resembles evolution? Nature’s competitive results are unintelligent, sometimes brilliantly optimized, sometimes hugely inefficient (see “Markets As Dumb As Trees”), and often disastrous. Likewise in (unintelligent) markets.
The lesson of these unsound structural similes? Beware the “organized storytelling” of free-market loving economists. Unless they actively address these gaps, they don’t understand the thing they love, or don’t care about its negative effects.
Borges said human history may be “the history a handful of metaphors.” Economics is a vast machinery of mathematized metaphors that now shapes our history.
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- There's more than one way to make a black hole, says NASA's Michelle Thaller. They're not always formed from dead stars. For example, there are teeny tiny black holes all around us, the result of high-energy cosmic rays slamming into our atmosphere with enough force to cram matter together so densely that no light can escape.
- CERN is trying to create artificial black holes right now, but don't worry, it's not dangerous. Scientists there are attempting to smash two particles together with such intensity that it creates a black hole that would live for just a millionth of a second.
- Thaller uses a brilliant analogy involving a rubber sheet, a marble, and an elephant to explain why different black holes have varying densities. Watch and learn!
- Bonus fact: If the Earth became a black hole, it would be crushed to the size of a ping-pong ball.
Protected animals are feared to be headed for the black market.
In a breakthrough for nuclear fusion research, scientists at China's Experimental Advanced Superconducting Tokamak (EAST) reactor have produced temperatures necessary for nuclear fusion on Earth.
- The EAST reactor was able to heat hydrogen to temperatures exceeding 100 million degrees Celsius.
- Nuclear fusion could someday provide the planet with a virtually limitless supply of clean energy.
- Still, scientists have many other obstacles to pass before fusion technology becomes a viable energy source.
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