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Wednesday
May012019

The Polymathic Economy

I was talking with my good friend Richard Mohun, a thinker and lecturer on business and economics, and we were talking about that good old economics chestnut, comparative advantage. Basically back in 1817 David Ricardo wanted to explain why on earth countries engaged in international trade even when they were less efficient at producing every single good than another country. He came up with the answer (it's to do with opportunity cost) and has wowed economics students every since. i can remember thinking when i studied the subject- wow- a real economics law that isn't obvious...And ever since 1817 the idea of specialising as an economy (a result of applying Ricardo's thinking) has been dominant in the minds of governments.

Except the ones we regard as renegade and even downright evil: the third reich, soviet russia, Mao's china- and maybe more acceptably, India until 1995 or so. These were countries pursuing autarky- the notion that a country should be self sufficient and not dependent on it neighbour's good will. Autarky is the macro-version of survivalism, self-suffiency and prepping for the next big disaster...

But is there something in between bending over and specialising as a country (and taking a massive hit when bigger and wealthier countries turn on you) and the lone nuttiness of pure autarky?

We think there is: the polymathic economy. In the polymathic economy we encourage as wide a variety of economic activity as possible. The idea is to enhance by cross fertilisation both creativity in the country but also perspective. I have shown elsewhere (see Micromastery, Penguin 2017) that even super specialists like Nobel prize winning scientists actively engage in arts, crafts and performing music far more than their more humble fellow academics. You need new ideas from somewhere and you need a complete break some of the time- both are supplied by a polymathic way of life. The main difference between a polymathic type and a specialist is attitude. The specialist jealously guards his patch; the polymath actively engages with other fields to steal new ideas...or even just borrow them.

The specialist economy (dumb shit like the 'knowledge economy', the 'finance economy'), encourage us to look inward and go into 'on guard' mode. Instead we need to be in explorer mode, entrepreneur mode. Real economic advantage is all about that strange thing economists are a bit cough cough embarrassed about - the psychological oomph of the people. Can't be measured, can't be pinned down- but compare Manhattan to Slough and you'll know what the difference is. To plan a polymathic economy couldn't be simpler. All key areas from manufacturing to services MUST be encouraged (which means just remove active discouragement and tariff/regulate/disrupt the hell out of cheapo crap imports in that area). Of particular interest are the arts. Nobel prize winners are many times more likely than regular scientists to actively engage in the arts. How do we encourage that? Simple. Forget grants and all that left brain nonsense. A minimum wage for a year for a creator- artist/writer/poet/musician- to qualify is easy, some evidence of work, some recommendations from existing artists. After one year an exhibition with the judgement decided on several things: quantity, quality and a long list of people who think said artist deserves her or his stipend. Mess up and you have a three year gap before you get another shot...kind of like parole. Of course, like anything, it requires judgement in its administration- but evidence shows polymaths are better at judging than specialists- not really surprising.

The main thing is, though, abandonment of the foolish notion of comparative advantage and engagement with the reality of real progress: a polymathic economy.

 

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