Giftmoot Economy

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A Critique of the Exchange

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The Exchange Economy

Liberal market economies What do exchange economies motivate? What do exchange economies require? What is a healthy economy?

Problems with the Exchange

Problems with the exchange Use, cost and exchange value The paradox of efficiency Busy jobs and busy consumption Business motivations Business cycle, speculation and crises Inflation and liquidity

Solutions in the Exchange Economy

How a pure exchange economy works Gifting in an exchange economy Economic calculation

History of the exchange

Origins of the exchange Why the exchange has endured Has the exchange been successful?

A Non-reciprocal Gifting Economy

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The Basics

What is a non-reciprocal gifting economy? What is a non-reciprocal gift? What's different about a non-reciprocal gifting economy? Why gifting? The concept of wealth The paradox of efficiency

Why and How People Would Work

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Economic calculation and work

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Giftmoots

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What are giftmoots?

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Economic calculation and distribution

Greedmoots and thriftmoots Basic allocation Other allocation methods How a giftmoot economy works

Social outcomes

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Demotherapeia

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The model of demotherapeia

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Greedmoots and thriftmoots

With the basic idea of giftmoots and the general principles of allocation described, I think it is possible to sketch out a type of economic equilibrium that giftmoots would reach if we were using something like the mainstream model of the rationally self-interest person.

The basic idea is this: regardless of how producers allocate goods to giftmoots, the giftmoots have a motivation to share the resources fairly amongst themselves. So even if one particularly giftmoot is over-allocated resources, it would benefit from allocating some of those resources to less greedy giftmoots.

Fairness in allocation strategies

Imagine, for example, a producers' giftmoot ( a “goodsmoot”), that needs to allocate units of food to two consumer giftmoots, one of which is requesting a higher allocation per person (a “greedmoot”) and one which is requesting a lower allocation per person (a “thriftmoot”). Let us say that the greedmoot has 80 people, and the thriftmoot 20, and there are 140 measures of food available overall. The giftmoots may not know the exact amount of food available - perhaps it varies from week to week, for example - but they have some idea of the average.

Say the greedmoot is asking for 2 measures per person (for a total of 160 measures) and the thriftmoot for 1.2 measures per person (for a total of 24 measures). The total of the requests is 184 measures, though only 140 are available. The goodsmoot has a variety of ways to allocate their measures of food but, ideally, they should be responsive to the requests of the giftmoots.

One way to allocate the resources is to fully satisfy the requests of the thriftmoot, allocating 1.2 measures per person for a total of 24 measures, and then allocating the remainder to the thriftmoot. That would give 116 measures to the greedmoot, resulting in 1.45 measures per person. This satisfies the thriftmoot entirely, and while it does not satisfy the greedmoot completely, it does provide them with more than the average provision of 1.4 measures per person if the food had been distributed across all the people of the giftmoots evenly.

140 food Members Bulk allocation Desired allocation Received allocation
Thriftmoot 20 24 1.2 1.2
Greedmoot 80 116 2 1.45
Overall 100 140 ... 1.4 (average)

If the goodsmoot allocates first to the greedsmoot, they could provide the entire 140 measures and still not satisfy their requests, leaving them with 1.75 measures per person. This would also leave the thriftmoot with nothing. But the consequence of this is that the thriftmoot members, having failed to achieve allocation, would migrate to the greedsmoot. In the next round of allocations, the greedsmoot would then have all 100 people, and the 140 measures would be distributed at 1.4 measures per person - more than the thriftmoot members were originally asking, and less than the greedsmoot members requested.

To maximise their shares across time, the greedsmoot would be motivated to allocate some of their resources to the thriftmoot. For example, if the greedsmoot were to be allocated all 140 measures of food, it would be beneficial of them to re-allocate 24 measures to the thriftmoot to satisfy its requests, and keep the 116 measures at 1.45 measures per head. This provides them with a greater measure per person over time than if they had retained all the allocated measures and motivated the thriftmoot members to join them, and they can do so without decreasing the allocation of their own members below that of the thriftmoot. Therefore, it does not matter whether the goodsmoot attempts to completely satisfy the requests of the thriftsmoot or the greedsmoot first, or even if it distributes randomly, because the result will likely be the same. (Given this, however, the goodsmoot would be able to make the most efficient allocation - with less double-handling - if they did this calculation first.)

If there is an overall under-allocation, where someone is going to miss out, people will be motivated to satisfy those asking for less first, because it will require no double-handling. If there is an overall surplus, then the issue does not arise.