NancyLebovitz comments on Rationality quotes: May 2010 - Less Wrong
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They have more redundancy at least to the extent that they operate with a greater surplus of wealth above subsistence. The greater interconnectedness and surplus wealth of modern economies also allows for resources to be quickly re-allocated across large geographical distances in response to a localized disaster.
In primitive economies the majority of the population are often living very close to a subsistence level and are able to accumulate little in the way of savings or capital to fall back on in hard times. In wealthier modern economies a disruption may cause dramatic swings in relative wealth but starting from a much higher level means there is a considerable cushion before facing a life threatening situation.
How do you propose to measure redundancy? One possible way to attempt to quantify redundancy might be to look at how modern vs. primitive economies cope with natural disasters. Modern economies usually see greater damage in dollar terms than primitive economies but much less loss of life as a percentage of the affected population. The lower casualty rates can be attributed to a number of properties of modern economies that derive from their greater wealth and interconnectedness. This includes things like higher quality, more robust buildings; greater stocks of non-perishable food, clean water and medicine; better trained, funded and equipped emergency services; quicker and better resourced rescue efforts from outside the worst affected area; a population that is not starting out in a state of malnourishment or ill health and greater individual resources enabling many to get out of the worst affected area.
Another possible test of redundancy would be to look at how modern economies cope with large scale warfare. Both Japan and Germany were more advanced pre-WWII than many poor countries today. Both countries lost a major military conflict which involved extensive destruction of infrastructure and massive civilian and military casualties. Both countries recovered over time and there are few if any examples of countries which started out with less modern economies, suffered comparable levels of damage due to warfare and demonstrated greater resiliency by recovering faster.
So in what sense are primitive economies more resilient than modern economies? You might argue that they suffer less dramatic swings in wealth in response to disruption than wealthier modern economies but in a disaster situation I would suggest the really important thing is not the magnitude of the change in wealth but whether it takes you 'below zero' and leads to individual deaths or total societal collapse. On this measure the historical record suggests to me that modern economies are more robust than primitive ones.
Another possible meaning might be that while no individual primitive economy is more robust than a modern one they are less interconnected and so failure in one does not cause a cascade to others. This sounds plausible in theory but I don't see strong historical evidence in this direction.
Finally I suppose you may be claiming that modern economies are more vulnerable to some black swan event beyond anything that appears in the historical record. This is obviously a hard theory to test. My feeling however is that a disaster of unprecedented type or scale would not be qualitatively different to previous disasters. You might see greater swings in 'dollar damage' or even relative wealth but the modern economies would still do better in absolute terms before and after such an event than primitive economies.
Is bad government a sort of disaster which should be considered in this discussion?
West Germany bounced back a lot more than East Germany.
More primitive societies don't have centralized government, so they don't have the risk of government going bad on a grand scale.
The canonical example here is, I think, China. Going from the impressive Renaissance-like period of 100 Schools of Thought during the Warring States period, to Zheng He, then to stultification.
Possibly. I wasn't considering it because I took 'modern economies' to imply (more or less) liberal democracies with (more ore less) free markets. I interpreted the original comment to be in reference to the theory that the increasing interconnectedness, globalization and specialization we observe within such economies is making them more vulnerable to catastrophic collapse. Bad government is certainly a problem but I hadn't seen it as a major component of this line of thinking.
It is an interesting question whether more complex economies (in the sense I describe above) must necessarily go hand in hand with more centralized government. I don't think that is the case and I certainly hope it is not the case (because it implies that complex economies must inevitably self-destruct) but it is a disturbing possibility.
The Soviet Union or the Third Reich were more like a "modern economy" than they're like hunter-gatherers or primitive agriculturalists, and (though it doesn't seem likely so far), a modern economy is more likely to have a government that goes bad than it is to turn into h-g or p.a.
When I was talking about centralized government, I didn't mean central economic planning. (Did you?) I just meant that modern governments have well-defined centralized control over (usually) a good-sized region and population.
I see centralized government as implying more central economic planning as well as more pervasive state intervention in all areas of life. I contrast it to a more federalized or devolved allocation of political power. I believe a complex economy is compatible with government that is more federal and less centralized than the modern United States and even less centralized than the European Union. I don't believe that the stability, security and free movement of trade and labour that are foundations of a complex modern economy require ever more centralized political power, although historically both have tended to increase alongside one another more often than not.