Altruistic Economics
2004-10-16
A Positive Alternative to Capitalist Economics…
A presentation for the London Social Forum by Dr. Robin Upton
Attribution-NonCommercial-ShareAlike licence from .A Telephone Dilemma
www.altruists.org
A friend needs a long talk with you. He rings from his mobile, and asks you to call him back.
• Mobile Landline = 10p/minute• Landline Mobile = 6p/minute
Would you call back if your friend asked?If you had the mobile, would you ask to be called back?
A Telephone Dilemma.
. International Telephone Dilemma
International .
Telephone Dilemma .
Telephone Dilemmas
A friend needs a long talk with you. He rings from abroad on his mobile, and asks you to call him back.
• Mobile Landline = 160p/minute• Landline Mobile = 8p/minute
Would you call back if your friend asked?If you had the mobile, would you ask to be called back?
Telephone Dilemmas
• Friends and family do not act selfishly• .• Acting selfishly has a long-term cost• Relationships are important• Homo economicus, the independent self-maximiser is a fiction!
Altruistic Economics
Altruistic Economics
Sympathy, s = emotional proximity
Worth a small personal loss toavoid a bigger loss to a friend…
Telephone Solution
Telephone Solution
Sympathy, 0 ≤ s ≤ 1
Example 1: Indifference value of s = 6p/10p = 0.6 Example 2: Indifference value of s = 8p/160p = 0.05
A Tale of Two Systems
A Tale of Two Systems …
Everyone Is Connected !
EconomicSystem Capitalism Altruism
Expectation of Behaviour
UtterSelfishness
Love of Others
PersonalRelationships
Irrelevant Essential
Everyone Is Connected !
Friends have their own friends… leading to a Network of CareInternet Gift Economy
Internet Gift Economy
>40,000 members in>170 countrieshave exchanged>1,000,000 T’s
www.favors.org
It’s A Small World !
It’s A Small World !
Our demonstration world has only 4 People:
• Andy- A Tax Adviser• Betty- A Gardener• Coco - A Clown• Dave - A Hermit
Altruistic Economics - Numerical Example .
Altruistic EconomicsNumerical Example
Sympathy Matrix
Andy has a Sympathy of 0.4 for Betty, so
SAB=0.4
Time-backed Currency
Andy, a poor gardener, estimates that 1 hour of competent help would save him 4 hours.
In return, he offers Tax Advice:
It’s A Simple Life !
It’s A Simple Life !
ServicesRequested
ServicesOffered
Part Transactions
Part Transactions
Possible Transactions
Just match up offers and wants in the same category…
Possible Transactions
. Simple Transaction – A1, B1
Simple Transaction – A1 B1
. Transaction Evaluation – A1, B1
U0, the personal utility function, shows the self-evaluated time costs of the transaction.
U0 is irrespective of the Network of Care
Transaction Evaluation – A1,B1
. Transaction Evaluation – A1, C1
Apply the sympathy values…
0.40.25
1
1
Transaction Evaluation – A1,C1
. Altruistic Evaluation (U1)
U0, the personal utility function, shows the self-evaluated time costs of the transaction.
Altruistic Evaluation (U1)
. Altruistic Evaluation (U2)
U1, the linked utility function, incorporates the personal utility of oneself and ones friends.
1 0.25 0.15 1
Altruistic Evaluation (U2)
. Altruistic Utility Functions
U2, the doubly-linked utility function, shows that
A, B and C would like the transaction to go ahead.
Altruistic Utility Functions
. Model Modification – Limits To Sympathy
The greater the degree of enlightenment, the wider transaction benefit spreads
through the network of care.
Users can choose from a range of
increasingly altruistic functions:
Model ModificationLimits To Sympathy
• If you would spend £1 to save someone £5, does that mean you would also spend £100
to save them £500?
Non-Linear Sympathy
• There are limits to what we do for others, so we add limits to sympathy to reflect that.
• Could you spend £1M to save them £5M?
Non-Linear Sympathy
Modelling Sympathy
• Sympathy is not constant
• Gradient increases with Time Given
Gradient = 2
Gradient = 20
• People run out of sympathy & get gradually less
sympathetic
Modelling Sympathy
Multiplier = 1/s
Approximate the curve with straight lines:
Express the sympathy as
Length 5h, gradient 2, so write it (5h 2)
Length 5h, gradient 10, so write it (5h 10)
Multiplier = 1/s
. Earlier Example – A1B1
A is willing to spend 5 hours to save 10 hours for B
Hence, sympathy =5h/10h= 0.5
We will be looking at the reciprocal, 1/s, which we call the multiplier…
Lengths of Time Multipliers
Earlier Example - A1B1
Modelling of Credit
Suppose A cares for B as follows:
B gains six hours for every hour of input from A, so the transaction has a multiplier of 6.
However, he will not work any more for B, since 6<10, so that a multiplier of 6 is insufficient.
A will put in 5 hours of work for B (because 6>2)…
Modelling of Credit
Numerical Example
• Increasing multipliers show reluctance to work altruistically as input is used up
2h 11h 22h 31h 41h 71h 101h 131h 15
Numerical Example
. Numerical Solution - SABC
4 A = 12 B
A’s evaluationB’s evaluation
12 B = 24 C.Cheapest Rate (3):
Cheapest Rate (2):
Cheapest Rate (3):
Next Rate (6):
Next Rate (4): +24B = 96 C6 A = 18 B1 A = +6 B
Numerical Solution - SABC
Multiple Path Example
A evaluates B evaluates Overall4 A = 12 B 12 B = 24 C 4A=24C6 A = 18 B 18 B = 72 C 6A=72C1 A = 6 B . 6 B = 24 C 1A=24C
4h 6
6h 12
1h 24
SABC =
Multiple Path ExampleSuppose A cares for D, who cares for C as shown below:
We know SABC =
4h 6
6h 12
1h 24
Calculate SADC =
15h 2
2h 5
3h 10
2½h 20
. Combining Alternative Paths
Combining Alternative Paths
. Keeping Track Of Work Done
A has 2 sympathies to encourage him to help C, ABC & ADC:
Combine these, by ordering the different time values by multiplier:
Now combine the two,
SAC =
15h 22h 54h 63h 106h 122½h 201h 24
Recording Work Done
. ‘Swinging’ of Relationship Credit
• Scoring would encourage people to give more
• Fairness is satisfied if, for any pair of friends, resource flow from A B is about equal to the flow from B A
A B
‘Swinging’ of Relationship Credit
. Ranking By Relationship Credit
• Work Balance can be pushed out in either direction…
A B
40h 120h 220h 420h 108h 20
SAB=
• Effect of variable multipliers is to restore the equilibrium
40h 20h20h
20h
8h
40h40h 120h 220h 420h 108h 20
SBA=40h 1 40h 1
20h 220h 420h 108h 20
20h 240h 1
Ranking By Relationship Credit
Two Systems Revisited
An F2F trading system could rank people by contribution made.
This would reward altruism by meaning that the most generous people’s requests were met more quickly...
Offers RequestsRobin Upton, +120h –40h, Skill= 8.2Computer Hardware, Statistics, Foreign Languages, Bangladesh Contacts …
Kevin Towell, +14h –3h, Skill= 8.8Computer Hardware, Motorbike repair, Shop Management, Psychology …
James Beckett, +60h –15h, Skill= 7.0Computer programming, Computer Hardware, Electronics, Internet Advice …
Mike Channel, +120h –40h, Rate= 10hHelp! My scanner doesn’t seem to work. I urgently need it to do a job on Nov. …
Mike Flex, +550h –175h, Rating= 70hCan you fix my broken Laptop? The power supply is dead, but probably…
Mable Trellis, +3h –2h, Rating= 2hMy mouse is not working properly. It keeps jumping. When I start up, it …
!!
Rewarding generosity, not selfishness, is the opposite of how capitalism works…
Computer/Hardware/Repair
Two Systems RevisitedEconomic
System Capitalism Altruism
Expectation of Behaviour
UtterSelfishness
Love of Others
PersonalRelationships Irrelevant Essential
Scoring System Encourages
Accumulation for Self
Donation to Others
Maths Zero Sum Positive SumSpiritual Evolution
Spiritual Evolution
• Is there enough to go round?
• Who is poor? Food? Shelter?
Global Altruism
• Biggest change is not physical…
Global Altruism• Altruism = love your neighbour as you love yourself …• In a globalised world, neighbours are everywhere …
Two Cycles
Two CyclesABUNDANCE
LOVE
SHARING
COOPERATION
SCARCITY
FEAR
SELFISHNESS
CONFLICT
Social
Personal
Feeling
Activity
Project Give Away
Project GiveAway• Give things thatare not importantto people who are…
• Stream things to Friends of Friends…
• Write the webaddress to spread the wordwww.altruists.org/giveaway
Friend2Friend
Friend2Friend
A decentralised F2F information-sharing layer will form the basis for a social software/trading system.
ArchitectureClient- Server P2P F2F
Interactions with…
Central server
RandomPeers Friends
Centralised? Yes Somewhat NoSecure? No Maybe Yes
Personal? No No Yes
. Friend2Friend Defining Features
Defining Features+ No abstraction from the work done+ Money can be revocable + Decentralised + No ‘command’ = No violence necessary- No ‘command’ = Unusual concept- Unfamiliar/radical = low confidence- Requires higher technology
Practical Ways To Move From Scarcity to Abundance
Practical Ways To Move from Scarcity to Abundance
• Live Altruism! Give Stuff Away www.altruists.org/Giveaway• Avoid the command economy where possible & help others use lesscentralised currency…
• Spread the word – Another world is here!
LIVE IT !!!