Calculation in kind methods
March 2023 › Forums › General discussion › Calculation in kind methods
- This topic has 7 replies, 4 voices, and was last updated 2 months ago by robbo203.
January 17, 2023 at 6:50 pm #239274
Correct me if I’m wrong but from my understanding of this article (https://www.worldsocialism.org/spgb/the-economic-calculation-controversy-unravelling-of-a-myth/) the proposed economic calculation we could use would be to use the same model as current stock controls just a little different.
For example to decide where specific goods should be allocated if for example, 2 (or more) different variations of goods can create another good we have a scale on priority according to what the community has decided and we assign where the items should go that way.
But my problem with this is certain industries such as medicine have a sort of unlimited needs, ie they can never have too much of something.
So if we assigned them the highest priority and we had to choose where to send metal, they would always get all the metal.
Am I missing something?
January 17, 2023 at 6:54 pm #239276
- This topic was modified 2 months ago by ActualSocialist10.
My alternative would be to use a credit system where we “price” resources based on:
4.Labour hours required
Different industries are then given credits they can spend how they choose, these credits are given to them by the community planning boards based on what people agree they should get and do it that way.
Any issues with this?January 17, 2023 at 8:05 pm #239278alanjjohnstoneKeymaster
I thought the pandemic demonstrated that the medical supply line had vulnerable links in its chain that capitalism was unable to cope with, despite the spin (think of the ongoing political wrangling of VIP procurement ordering as well as the nationalist roll-out process).
And then there is NICE within the NHS which determines the effectiveness of various treatments using a form of cost-benefit analysis
I think we proposed a combination of non-monetary approaches, one being the rational application of Maslow’s hierarchy of needs. It would seem reasonable to suppose that needs that were most pressing and upon which the satisfaction of others’ needs was contingent, would take priority over those other needs. We are talking here about our basic physiological needs for food, water, adequate sanitation and housing and so on. This would be reflected in the allocation of resources: high-priority end goals would take precedence over low-priority end goals where resources common to both are revealed using a “points” system of cost-benefit analysis.
A self-regulating system of stock control which of its responding very rapidly to shifts in demand. If people come to reduce their demand for a particular product this will manifest itself in a build-up of surpluses, prompting distribution points to cut back their orders from suppliers who, in turn, will reduce their inputs for said goods from their own suppliers and so on the further back along the production chain.
The opposite would happen if people increased their demand for a good. This would automatically trigger a signal for more of such a good and hence the inputs for such a good. The point is all this is perfectly possible today and more so now with the development of computerised system of stock control. A self-regulating system of stock control which responds directly and promptly to changes in the pattern of demand from both production units and consumers provides the necessary data we need relating to stocks of inputs. It then becomes a matter of economising most on what is scarcest (based upon Liebig’s Law of the Minimum). The “relative scarcity” of any input is a function of the demand for the end product of which it is a component and of the technical ratio of input to output (or product itself). In this way, it is quite possible to rank the relevant inputs in terms of their relative scarcity. So selection of the least cost combination is entirely practicable in a communist society. Only the method of doing it is quite different to what happens with a common unit of accounting.
It is what can be called a “lateral” approach to cost accounting rather than a “vertical” approach. We select technical combinations of inputs that minimise as far as possible our reliance upon scarce inputs in favour of more abundant alternatives. This is not an exact science but it’s the orientation of decision-making that counts – the fact that we are operating within a systemic constraint that pushes us always in the direction of economising most on what is most scarce – which makes it an eminently sensible and reasonable principle to apply.
We don’t favour labour vouchers believing it is far too cumbersome as a mechanism for rationing. If you are going to have rationing, at least for some goods, there are far more effective and straightforward mechanisms than this.
I think we should be cautious in declaring that free access solves everything and that production-for-use or needs-orientated or reciprocity-based systems will be a panacea. However, it will remove much of capitalism’s distribution problems of can’t pay, can’t have.
I’m all for a continued discussion on how to implement socialism but always with the caveat that we cannot pre-empt the decisions of those future generations of socialists who will have the responsibility of bring it about. We ourselves always remain in the realm of speculation and educated guessing.January 17, 2023 at 8:21 pm #239279
Yes that makes perfect sense thank you!
I was having an issue understanding it to be honest, as I like to explain it to someone else in order to confirm I understand myself and I couldn’t.
But the way you put it clarifies it for me perfectly.
Also very true on the last points, I’ve always said myself “production for use won’t solve everything, but it will do a lot better at ensuring everyone has a chance at a normal life that’s for sure!”January 18, 2023 at 8:51 am #239283Young Master SmeetParticipant
Just to add some points:
Each organisation would have definite ends: i.e. a shoe factory might have the mission statement of ‘Providing enough shoes for the whole community’. Within that, they might have performance targets that “there should be shoes of varying purposes and designs that are long wearing and comfortable and able to resist water.” This provides a rational basis for decision making when assessing inputs. The chief thing is that socialist production is with a definite end in mind, which is to provide for the democratically agreed needs of the community. they would be aware of the global plan to ‘provide all human beings with sufficient footwear for their needs’ and would take part in discussions of how that could be achieved, and what resources (including human) would be needed.
Even today, project management software allows for project planning to achieve defined goals, and this would still be available in socialism.
I’ll add an important point that there can be no compulsion to labour, so we’re only providing each other with what we’re willing to work to provide each other.
As Alan says, other methods might be applied. For example stable matching algorithms might be useful (say for housing allocation) or adjusted winner auctions could be useful at a ‘wholesale’ level. There are some interesting tools at http://www.spliddit.org/ These all provide rational and computable approaches that could help get goods where they need to be to achieve our goals.January 18, 2023 at 9:08 am #239285
Yeah that makes sense and that’s what helped me understand, we’d have clear goals in mind, ie we need x amount of hospitals.
On the software side of things, specially the algorithms, I dare say we are already making great strides into this system anyway.
Even if socialism doesn’t need it per se, looks like it’s coming and will make our job much easier and economy much more effective.
It really feels like in the near future society will either evolve to socialism or descend into a feudal like society where machines produce the large sum of products while most people get by on some sort of UBI plan or become mere entertainment for the lords.
I don’t forsee capitalism surviving automation.
Worse yet because of climate change and the coming refugee crisis we could see a fascist rise which starts a nuclear war, but this seems least plausible to me.January 18, 2023 at 9:46 am #239287alanjjohnstoneKeymaster
I’m a techno-neanderthal who doesn’t even own a mobile phone so I am constantly amazed at the things they are capable of doing and being put to use right now. To think I used to think they were for just talking !!
Logistics and the determination of distribution supply chains is a whole science in itself these days.
I used to travel off the beaten track at one time, and I don’t think I ever came across a place that Coca-Cola had not got to first.
The global supply chain, sometimes called the field to the fork, that multinationals use to keep supermarket shelves stocked will remain and be applied for society’s benefit and not corporate advantage
The possibilities seem endless and only limited by our imagination.January 18, 2023 at 10:29 am #239288robbo203Participant
“It really feels like in the near future society will either evolve to socialism or descend into a feudal like society where machines produce the large sum of products while most people get by on some sort of UBI plan or become mere entertainment for the lords. I don’t forsee capitalism surviving automation.”
TBH I am sceptical about the possibility of capitalism imploding as a result of automation. The employed workforce worldwide has, after all, been growing not diminishing in the face of increasing mechanisation, robotisation and automation – although the composition and location of the workforce has changed. For example over 80 per cent of manufacturing now takes place in the global South
Alarmist stories of jobs being decimated are, I think, a bit exaggerated. Partly, this is because what is being looked at is only one segment of the production chain. A machine might make three workers redundant when it once took , say, 5 workers to do the job in question , leaving only 2 workers needed to get done. But this is to overlook the additional labour required to produce the machine itself or the additional labour required to produce the inputs that go into making that machine
Partly also it is because what is more likely to happen is that the nature of the job will change rather than the job itself will disappear . According to a recent MCkinsey Report:
“Almost half the activities people are paid almost
$16 trillion in wages to do in the global economy
have the potential to be automated by adapting
currently demonstrated technology, according
to our analysis of more than 2,000 work activities
across 800 occupations. While less than 5 percent
of all occupations can be automated entirely using
demonstrated technologies, about 60 percent of all
occupations have at least 30 percent of constituent
activities that could be automated. More occupations
will change than will be automated away”
(McKinsey Global Initiative,
“A FUTURE THAT WORKS:
I think from a socialist point of view the more interesting trend to focus on would be the growing proportion of “socially useless labour” in capitalism (not the same thing as “unproductive” or non-profit-producing labour) which you might be hinting at in your comment….
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