Great conversation. I loved it.
I like the distinction between rivalrous, non-rivalrous, and anti-rivalrous—rivalrous goods have a zero-sum benefit (when I eat the sandwich, you can’t eat that same sandwich), non-rivalrous goods are non-zero-sum (everyone can watch the same movie), and anti-rivalrous, where usage increases the value (the more people use Linux, the better Linux becomes for everybody). An awesome and important distinction here!
The question I get curious about is whether the entire economy can, will, or should transition over entirely to an anti-rivalrous mode. I don’t think it will.
Jordan seems to be promoting this idea, yet he vacillates a bit when, on the one hand, he’s making a bold claim that anti-rivalrous economics is largely big leap forward, leaving rivalrous economics in the dust, and citing a long-term existence of anti-rivalrous “goods” like human language and open-source software (both of which I’d agree are anti-rivalrous). For the sake of this discussion, I’d simply say that anti-rivalrous dynamics have been with us for a long time, dating at least back to pre-historic humanity.
(And, if we dip into biology, briefly, I think that non-human life creates “anti-rivalrous” innovations, the sort which “evolve evolvability”, like eukaryotic cells, sexual reproduction, vertebrae, nervous systems, circulatory systems, etc., and then stores “blueprints” for them in the genome, which get shared across thousands of species over millions of years.)
I think I agree that in the internet era, we are seeing an increase of anti-rivalrous goods, and I think we will see a whole lot more. (I’d bet it’s accelerating non-linearly, at least polynomially, perhaps even exponentially, as Kurzweil is fond of suggesting.) For the goods and services which can be digitized (thereby driving marginal costs towards zero) and distributed in such a way that creates a network effect (the more people utilize it the more valuable it become), then the anti-rivalrous economy will continue expanding. So far, so good.
Here is the thing, from what I can tell, wherever humanity (or life) creates an anti-rivalrous innovation, that innovation gives a selective advantage within a larger environment which is not purely anti-rivalrous. The selection pressures arising from the scarcity of resources are causally related to the emergence of the anti-rivalrous innovation.
Take language—pre-historic humanity gained a survival advantage in a rivalrous environment by spreading this anti-rivalrous innovation (humanity shares in a win-win, making us more effective at killing and eating food, a win-lose). Building on spoken language, the innovations of written language, the printing press, and movable type, when aggregated, created a massive surge in economic productivity, both expanding the non-rivalrous domain (like books, stories, recipes, etc.) as well as within the more well-worn domain of rivalrous goods and services.
Analogously, in the open-source software movement, for-profit companies have been building rivalrous goods and services (like servers and service contracts) on top of anti-rivalrous goods (like the Linux code-base). They take part of their revenues and pay for the costs of Linux coders. This effectively siphons capital from a rivalrous market and creates value in an anti-rivalrous one, where it stays.
In the post bitcoin world, we’re seeing a similar dynamic where miners transform electricity into cryptocurrency, and big players from Bay Area venture capital to Wall Street are also piping capital into crypto. And I don’t think that the crypto world is strictly anti-rivalrous either. To take Bitcoin as an example, the Bitcoin code base is certainly anti-rivalrous (has both zero-marginal-cost to get a copy and the code execution benefits from network effects), but Bitcoin as a currency is rivalrous because the algorithm puts a cap on the total Bitcoin supply, creating scarcity. And it’s this scarcity that is creating the very incentive for capital to flow into the system from the greater economy. So even here we see the rivalrous and anti-rivalrous are interdependent and intertwined.
I’m open to the possibility that the emerging Crypto 3.0 that Jordan and Josh are talking about in this video could miraculously transform every part of the economy into a completely anti-rivalrous dynamic, but I seriously doubt that it will. It sounds a bit too magical to me at this time, and a bit too similar to the medieval ideas of perpetual motion machines and alchemy. I think these old ideas are pure hokum and are artifacts of “magical thinking”. Nature has a limit, and that limit is entropy.
If these 3.0 projects are genuinely anti-rivalrous to their core, then this would seem to imply that for any project in this space, like DAOStack, it would need to create some kind of capital flow into their system where there wasn’t an upper limit on the token sale, because that would create artificial scarcity, making it rivalrous. I find this hard to imagine this being the case. On the other hand, if there is an upper limit on the token volume, then we’re right back where we started from—the anti-rivalrous needs the rivalrous. Either that or I’m missing something important here.
Though I have expressed my doubts, I’ll add a note of positivity. Given the minute fraction of solar energy that life on earth, economically as well as ecologically, can capture and utilize, and humanity’s ability to tap into nuclear energy, I believe we aren’t even remotely close to the amount of economic growth and abundance that’s possible. Energy capture, storage, and utilization is the ultimate upper limit here. I believe in projects like Bitcoin, Ethereum, and DAOStack because I think the sphere of the anti-rivalrous can be expanded quite a bit, and a far greater percentage of our total economic exchange as a species can likely migrate to an anti-rivalrous dynamic.
If all we’re talking about here is a change in the relative proportion of anti-rivalrous vs. rivalrous exchanges, tilting increasingly in favor of the anti-rivalrous, then I’m 100% on board. If what we’re talking about is a perpetual motion machine, alchemy—anything like a zero-waste, steady-state, or 100% regenerative economy—then I’m calling BS. This emperor has no clothes.
(These are my current thoughts until someone presents a good enough reason for me to change my mind.)