Friday, January 28, 2011

More details on this supply/demand thingy

In my world I have two groups arrive at a spot to exchange one good and another to exchange another good. The Y axis is redundancy, or its proxy, the queue lengths of each group. At equilibrium, the number of traders in each group arrive at a stable rate and one queue is not growing relative to another. So equilibrium is all about keeping queue length minimal.

This is the demonetized view, it allows for bartering to be coexistent with money. I included holiday gift giving, when the holiday gift economy is active, we equilibriate toward optimal gift exchanges, not captured by money accounts. It includes charity lines. It includes job hunting queues, so it can capture the search queues. Another model is the open source software exchange, programmers agree to trade modules. It include sharing space with children. Working for room and board. Real estate exchanges, working for stock options. Voting.

So what? Well economists capture this stuff, mainly for the purpose of finding new activities to monetize.

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