The Fairness Theorem - page 2
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A mathematical proof of not only the possibility, but the necessity of a libertarian economy - a free market.
Since the theorem is constructive, it can be used as a mathematical basis for libertarian economic theories that do not contradict the conditions of necessity and sufficiency of a fair market exchange stated in the theorem.
The theorem proves that not only material, but also spiritual values can be exchanged on the free market. It is also possible to calculate a fair price for spiritual goods, just as for material goods, expressed in material units of measurement, such as precious metals.
The current edition can be found HERE
It's called GOSPLAN. Only it was much better worked out, just creepy. Powerful mathematics was used.
The result is known.
Personally participated in it. In 1982 he proved (mathematically) the impossibility of planning. For which he was exiled from the State Planning Committee to Ekibastuz for 5 years.
On the fingers proof of the impossibility of the following. Take Ekibastuz as an example.
They mined 95 million tons of coal with excavators, loaded into wagons and delivered to CHP. Naturally, there is accounting. They counted tons by each excavator, added up and got 95. Coal was mined in two grades. The grade was rigidly connected to a certain CHP. If you mix it up, either the CHP goes out or the pan burns out. You can't mix it up, but you get it mixed up and once every six months there's an accident. Problem. Accounting again. They stack the tonnes by grade. 95 doesn't work. Always a different figure! At first everyone thought it was about the accuracy of measurement methods (volume by excavators and volume by grades). But no. Different measurements were made by different people and they had different interests. The system was not mathematical but social. The management was aimed at reconciling these social interests. In successful management there were no accidents, you let go of the reins a little - all crash, it's called "goat".
I named two signs of a commodity. If it is about coal, there are up to 320 such signs at Gosplan level! Elsewhere. And so for all kinds of goods.
When I came up with this and started running around the offices of the Gosplan, no one reacted. But when I found myself in Ekibastuz (from Moscow parcels!), I realised that everyone knew this, and I was just the boy who shouted "And the king is naked!
I leave the question of the dimensionality of the task out of the parenthesis.
Well, as always. Trying to profit from the post.
Get into econometrics, it's a piece of cake for you to master and you'll probably make money and I'll get an opponent on the subject. So in full accordance with your theory - equivalent exchange.
A mathematical proof not only of the possibility but also of the necessity of a libertarian economy - the free market.
Since the theorem is constructive, it can be used as a mathematical basis for libertarian economic theories that do not contradict the conditions of necessity and sufficiency of a fair market exchange mentioned in the theorem.
With the help of the theorem it is proved that not only material but also spiritual values can be exchanged on the free market. For spiritual goods, just as for material goods, a fair price expressed in material units, such as precious metals, can be calculated.
I believe, Reshetov, you help yourself and your discussion if you formulate - as it is common in modern science - the PURPOSE OF THIS SCIENTIFIC RESEARCH.
In the meantime, a few remarks:
- the world around you is much more diverse than a couple of theorems;
- the world around you is built on contract law;
- the world around you is built on verbal, but nevertheless on the strongest contract in the world - marriage, marriage;
- any law, including all biblical law, allows for exceptions, or exceptional situations; contract enforcement, too;
- the diversity of contract law and situations - forces judges (arbitrators) to make decisions based not on "Law", which is just a legalized tradition, but on an INITIAL Sense of JUSTICE, which is purely spiritual, which cannot be considered; otherwise even a monkey could judge;
- the modern separate "Contract theory" as a branch of economic mathematics is developing quite vividly, though crookedly. The econometrics mailing list (from faa1947) sends a dozen articles a month from this field.
It's called GOSPLAN.
The result is known.
I was personally involved in it.
.......... .
I named 2 attributes of a commodity. If it is coal, there are up to 320 such attributes at the Gosplan level! Elsewhere. And so for all types of goods.
When I came up with this and started running around the offices of the Gosplan, no one reacted. But when I found myself in Ekibastuz (from Moscow parcels!), I realized that everyone knew it, and I was just a boy, shouting "The king is naked!
I leave the question of the dimensionality of the task out of the parenthesis.
Well, as always. Trying to profit from the post.
Get into econometrics, it's a piece of cake for you to master and you'll probably make money and I'll get an opponent on the subject. So in full accordance with your theory - equivalent exchange.
Well yes, it's all true. There are about 20 "varieties" of coal in use at oblast level. And when the regional financial department starts calculating the population's coal sales BETWEEN the accounting nightmare starts, which escalates into a programmer's nightmare. (I participated in this nightmare as an injured modeler-programmer).
So for example the monetisation of benefits in Russia was a good step from Gosplan towards an open free market. (That's what I'm saying, don't get me started on economic policy, I suggest we talk in general terms).
What's with the 'dimensions'? Why "silence"? After all, physicists, pure mathematicians and radiologists have little idea of what economic modelling within a large firm, let alone an industry, leads to. For example, if a person just STANDS without moving, his thinking processes data about 200 muscles to balance, which "can be simulated" by 200 integrals and diffusers, which is completely impossible on a computer.
By the way, Reshetov, a man thinks not with his head but with his whole body, all his cells. The brain (head) only controls this process. Therefore all these neuronets are just a small tool for private tasks, and not the solution of trading simulation problem.
That is why traders and programmers pay $300-1000 each for an Aeron chair, which actually provides comfort for thinking, but not for the back seat.
faa1947, with no disrespect to Mr Reshetov's abilities, I personally FAR doubt that he will be able to fully "master" economic mathematics or econometrics. One has to be trained still in the institute on the failures of other "modellers" and then get burnt by modelling in real life (as for example you have shown here) to be able to modelling economic processes in a VERY careful way, without mechanization, without rabid radio-freakishness.
If one cannot simulate how a person just STOPS in place, how can one simulate when HE runs to the shop, buys something there, then returns it dissatisfied, and then enters the forex market and changes something there?
A mathematical proof of not only the possibility but also the necessity of a libertarian economy - a free market.
Since the theorem is constructive, it can be used as a mathematical basis for libertarian economic theories that do not contradict the conditions of necessity and sufficiency of a fair market exchange mentioned in the theorem.
The theorem proves that not only material, but also spiritual values can be exchanged on the free market. It is also possible to calculate a fair price for spiritual goods, just as for material goods, expressed in material units of measurement, such as precious metals.
The current edition can be consulted HERE
A cursory reading, my opinion:
In the market no one can assume anything, there are strict laws of price formation, according to which the market price is formed as a result of differently directed actions of the market participants and there is little that depends on the particular participant. There are seven types of prices in the market:
1. Cp - The purchase or production price of the good you are about to sell;
2. Ts1 - The first break-even point;
3. Tsopt - The optimum selling price;
4. RR - Market price;
5. Ts2 - Second break-even point;
6. Cp - Marginal selling price above which the product cannot be sold;
7. Tsp - Price of the goods owner, which he sets in the range from 0 to Cp at his discretion by virtue of ignorance of existence or ignoring other above price levels, motivated by his personal considerations.
Moreover, Tsp<Ts1<Tsopt<Tsr<Ts2<Tspr
There are clear and unambiguous formulas for their calculation, depending on the market elasticity of price, virtual market volume, fixed and variable costs of sales. No one and nothing else can influence their formation under market conditions.
A quick look, my opinion:
In the market no one can assume anything, there are strict laws of price formation, according to which the market price is formed as a result of the multidirectional actions of market participants and little depends on the individual participant. There are seven types of prices in the market:
1. Cp - The purchase or production price of the good you are about to sell;
2. Ts1 - The first break-even point;
3. Tsopt - The optimum selling price;
4. RR - Market price;
5. Ts2 - Second break-even point;
6. Cp - Marginal selling price above which the product cannot be sold;
7. Tsp - Price of the goods owner, which he sets in the range from 0 to Cp at his discretion by virtue of ignorance of the existence or disregard of other above price levels, motivated by his personal considerations.
Moreover, Tsp<Ts1<Tsopt<Ts2<Tspr
There are clear and unambiguous formulas for their calculation depending on the price elasticity of the market, virtual market volume, fixed and variable costs of selling the product. No one and nothing else can influence their formation under market conditions.
You are mistaken, Yusuf.
A founder of Sony named Akio Morita in his famous book "Made in Japan" just shows that all these "rules" and price models are nonsense. Each case, for each situation, has its own rules. There, in the early days of Sony, he turned down a huge lucrative contract to export radios to the USA, because the kind of lucrative price did not include insurance against termination of contract, or rather the short term nature of the big contract, which cannot be taken into account not only precisely, but even approximately.
The US customer at the time simply laughed at him, regarding Morita as a moron running away from profits. For me Akio Morita is no authority at all, but his book is just everywhere.
The question is as old as the world.
The question of what to do and who is to blame is no longer relevant.
According to Chekhov the nut was not stolen.
And no disaster was planned.
God forbid...
Except that these very railways are plentiful.
A quick look, my opinion:
In the market no one can assume anything, there are strict laws of price formation, according to which the market price is formed as a result of the multidirectional actions of market participants and there is little that depends on the individual participant. There are seven types of prices in the market:
1. Cp - The purchase or production price of the good you are about to sell;
2. Ts1 - The first break-even point;
3. Tsopt - The optimum selling price;
4. RR - Market price;
5. Ts2 - Second break-even point;
6. Cp - Marginal selling price above which the product cannot be sold;
7. Tsp - Price of the goods owner, which he sets in the range from 0 to Cp at his discretion by virtue of ignorance of the existence or disregard of other above price levels, motivated by his personal considerations.
Moreover, Tsp<C1<Copt<Cr<C2<Cpr
There are clear and unambiguous formulas for their calculation, depending on the elasticity of the market for price, the virtual volume of the market, fixed and variable costs of selling the goods. No one and nothing else can influence their formation under market conditions.
Dear Yusuf!
You are deeply misguided, although you are repeating the undividedly dominant pre-1987 theory called "efficient market".
I once saw an article discussing the eligibility of a US antitrust committee in one state on the grounds that the antitrust rule was broken in that state: there must be more than 1000 sellers and more than thousand buyers of the same product.
This is a necessary but not a sufficient condition of your rules.
Because there are panicked price movements (stock market crashes) and deliberate price manipulation. On the latter question even a branch was opened on the forum. It was discussed in detail.
You are mistaken, Yusuf.
A founder of Sony named Akio Morita in his famous book "Made in Japan" just shows that all these "rules" and price models are nonsense. Different rules apply to each case, for each situation. There, in the early days of Sony, he turned down a huge lucrative contract to export radios to the USA, because the kind of lucrative price did not include insurance against termination of contract, or rather the short term nature of the big contract, which cannot be taken into account not only precisely, but even approximately.
The US customer at the time simply laughed at him, regarding Morita as a moron running away from profits. For me Akio Morita is no authority at all, but his book is just everywhere.
Perhaps if Akio Morita refuses to sell his product at one of the above prices, he is no longer a market player and his moves are accounted for by the market's change in elasticity and market capacity, determined experimentally by selling several batches of the product at different prices. Sellers and buyers already know that he has a large batch of goods and this fact will indirectly lead to an adjustment of the market price. He is not going anywhere, sooner or later he will still sell his goods within the range of C7 - Cpr.