Dev.SN

Adapting Monopoly to Understand Modern Money

posted by Dopefish on Saturday March 01 2014, @10:30AM   
from the pass-go-and-collect-$200 dept.

buswolley writes:

"Is the United States or the EU really too poor to afford to build the things each needs to maintain prosperous nations? Modern Monetary Theory (MMT) posits that America is not too poor in real resources to do the things it needs to do, and now proponents of the theory have adapted the rules of the classic board game Monopoly to demonstrate their case. For those that do not know what modern monetary theory is about, a suitable primer on the topic might be Warren Mosler's Seven Deadly Innocent Frauds of Economy Policy or Diagrams and Dollars, either as a book on Amazon or on-line for free at NewEconomicsPerspectives.org.

While the Modern Monetary Theory perspective tends to elicit disbelief and even rage, I think it is important for any scientist and geek to weigh the evidence carefully, and by doing so understand better about how and why money is created and destroyed."

• Re:trying to argue in favour of inefficiency? Re:trying to argue in favour of inefficiency? (Score: 4, Insightful) by TheRaven on Saturday March 01 2014, @12:56PM

  by TheRaven (270) on Saturday March 01 2014, @12:56PM (#9159) Journal

  Ignoring the economic argument is ignoring the entire point of the example. Government regulation does increase the circulation of money in the economy, as shown by the example. In a more complex economic model, you have to account for two other important factors:

  • Does it increase costs such that some economic activity no longer happens?
  • What is the opportunity cost (would the people implementing the regulations be more productively employed elsewhere in the economy)?

  In both of these cases, the economic benefit can be offset by the costs.

  There's also the obvious social question of whether the regulation actually improves life for people in the society (does reducing the freedom of builders to build and sell unsafe buildings outweigh the benefit of knowing that a new building probably won't fall down?). Social benefit and economic efficiency are very different things: it's obviously better, from a purely economic perspective, to kill people as soon as they retire, but you'd be hard pressed (outside of Florida) to argue that it would benefit society.

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  sudo mod me up

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• Re:trying to argue in favour of inefficiency? (Score: 2, Interesting) by geb on Saturday March 01 2014, @02:14PM

  by geb (529) on Saturday March 01 2014, @02:14PM (#9183)

  You'll get no argument from me on the need for regulation to promote safety, fairness and opportunity. I am a strong believer in the rule of law. That is why the example feels so wrong to me.

  The section before that is similar I suppose. The monopoly board isn't under threat of invasion, so the example of buying aircraft carrier is pointless too, but in that case there was no suggestion of buying a deliberately broken and useless aircraft carrier.

  In the case of the building regulations, the houses and hotels will be the same on the board with or without laws, so utility of the rule doesn't come into it, but it was specifically stated that the building regs should be so utterly incomprehensible that the ordinary player would require a specialist to ever apply them. That's not good.

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