Excuses, ExcusesWhen trying to decipher the physical laws of the universe, we find it easier to start with a simplified model. For example, when describing the flight of a cannonball, we start by ignoring air friction and the wind. That makes the math simple enough for one person to handle without a computer in many cases, and the calculated results are close to the actual flight in the common cases.
Economics is not as easily simplified as physics.
In physics, we can see the interactions, even if there are many interactants we don't directly see, like wind, or electric or magnetic fields.
Referring back to the cannonball example, gunpowder is not very simple, but we might instead use a catapult or trebuchet to launch the cannonball. We can see what happens, we can measure and time the acceleration paths, etc. And we can compare our results with the path and timing of a dropped cannonball or a cannonball rolling on a slope.
In economics, we deal with complex interactants and abstract interactions. Some of the elements are fairly straightforward, like food, fuel, and housing. Some, like value, are so abstract that we can't safely define them once and expect them not to change.
Some elements of economics, like money, are deceptive simplicities hiding complex and abstract qualities whose continual, often hidden variations play directly into the math.
We need simplifications to be able to work with economics, even with help from computers. But economic interactions are difficult to simplify.
Complex mathematics looks a lot like literature, abstract mathematics even more so.
So, I'll take a hint from the math and construct this informal thesis on the fundamentals of Economics as a set of thought experiments in the form of a novel.
I'll need a framing story. A good simulation game always has a good framing story, and this is (pretty much) a mental simulation game.
But I need an uncharted, uninhabited island. Such islands no longer exist.
That is, Google took the final steps to eliminating uncharted islands when they introduced their map service.
So I have to set this framing story about 50 or so years ago, when uninhabited islands still seemed like they might stay undiscovered for a while. And I'll still need to set it in an slightly alternative history.
It was either that or talk about interstellar travel, and we think we know too much about that now, too.
This story is entirely fiction. Any resemblance to real people or events is purely coincidental.
The framing story begins here, complete with anachronisms and out-of-contexts:
The table of contents can be found here:
[JMR20160614: The initial (rough) draft of this chapter is here: http://free-is-not-free.blogspot.com/2016/03/economics-101-novel-ch00.html.]