If Bob is not providing any money and cannot ‘personally lose the cash’ and is never ‘any worse off’ because he just resells it, what is he doing, exactly? Extending Anne some sort of disguised interest-free loan? (Guaranteed and risk-free how?) Why can’t he be replaced by a smart contract if there are zero losses?
1. (Coordination). Bob does lose cash of his balance sheet, but his net asset position stays the same, because he’s gained an IC that he can resell.
3. (Price discovery). I agree that in cases of repeated events, the issues with price discovery can be somewhat routed around.
2&4. (Philanthropic capital requirement & Incentive for resellers to research). The capitalist IC system gives non-altruistic people an incentive to do altruistic work, scout talent, and research activities’ impact, and it rewards altruists for these. Moreover, it reallocates capital to individuals—altruistic or otherwise—who perform these tasks better, which allows them to do more. Nice features, and very standard ones for a capitalist system. I do agree that the ratchet system will allow altruists to fund some talent scouting and impact research, but in a way that is more in-line with current philanthropic behaviour. We might ask the question: do we really want to create a truly capitalist strand of philanthropy? So long as prices are somewhat tethered to reality, then this kind of strand might be really valuable, especially since it need not totally displace other modes of funding.
1. (Coordination). Bob does lose cash of his balance sheet, but his net asset position stays the same, because he’s gained an IC that he can resell.
3. (Price discovery). I agree that in cases of repeated events, the issues with price discovery can be somewhat routed around.
2&4. (Philanthropic capital requirement & Incentive for resellers to research). The capitalist IC system gives non-altruistic people an incentive to do altruistic work, scout talent, and research activities’ impact, and it rewards altruists for these. Moreover, it reallocates capital to individuals—altruistic or otherwise—who perform these tasks better, which allows them to do more. Nice features, and very standard ones for a capitalist system. I do agree that the ratchet system will allow altruists to fund some talent scouting and impact research, but in a way that is more in-line with current philanthropic behaviour. We might ask the question: do we really want to create a truly capitalist strand of philanthropy? So long as prices are somewhat tethered to reality, then this kind of strand might be really valuable, especially since it need not totally displace other modes of funding.
What if no one buys it?
If the market value of the IC is 0, then ICs aren’t gonna work. But it’s OK if very few ICs are sold, so long as the market clears at a decent price.