[p2p-research] == Currency Based on CPU and Man Hours (for Digital Goods) ==

[marc fawzi]

In replying to why a currency is needed

<<
We need to recoup the cost of production in order to produce more.

In order to recoup, some one needs to give us something back and that
something should allow us to produce more, so if it's "man
hours" that we need to recoup we'd get "man hour" tokens back (so we
can trade them for man hours, i.e. work, from a producer who has a
surplus of man hours, i.e. a lot of free time) and if it's "cpu hours"
we need to recoup then we'd get back "cpu hour" tokens and we can pay
them to someone with "cpu hour" surplus (a server that's not fully
utilized) to use their machine as part of our production (over P2P)

Money paid for digital goods and services does not lead to ownership.
It simply enables further production.

The way the tokens are created and managed is the same way as in the
P2P Energy Economy, i.e. based on increase in the flow of "cpu hour"
and "man hour" from peers with surplus to peers with deficit. No
change in the algorithm or how money is created but now you have two
types of tokens, one for paying back humans so they can recoup and
produce more (by hiring other humans with surplus man hours) and one
for paying back machines so they can produce more (by utilizing other
machines with surplus cpu hours)

My intent is to build P2P trading software to enable sustainable
abundance in digitally produced goods and services (open software,
open music, open CAD models, open SL models, open Spice models, open
Matlab models)

So to summarize, you need to recoup the cost of production in man
hours and cpu hours so you can produce more. Trading with "Cpu hours"
and "man hours" as currency  let's you do that for digitally produced
goods and services such that producers don't need a Donate button and
Big Corporate sponsors.
>>

The joule token scheme in P2P Energy Model, while being much more
universal, is a climb up a very steep hill, in that it's hard for
people to imagine measuring human work in joules or measuring
computational work in joules, and while both are very possible the
complexity of the model needed to enable universal energy token for
all types of work is far bigger than the complexity (or lack of) when
using specialized currencies such as the "man hour" token and the "cpu
hour" token for human and computer work, respectively, and not just
any kind of machine work.

The "cpu hour" currency has the same characteristics as the joule
token: fixed work value and increasing use value over time, which
promotes a trend toward higher computational efficiencies over time,
i.e abundance in compute power.

The "man hour" currency is based on a loose standard (e.g. in the
software industry) where people generally know how many man hours a
given development task will take. It's been called "mythical" because
software project estimation is normally done for staged development
processes where the plan goes to hell the minute programmers run into
unexpected issues. Estimation based on SCRUM style sprints tends to be
more accurate. But in any case, the "man hour" as currency allows
price variability based on estimation of time it take the average
developer to accomplish some task, not based on demand and supply. If
the supply is large then the man hour estimate will not go down. If
the supply is limited the man hour estimate will not go up. Thus, in
the latter case, it does not enforce scarcity.  And it promotes
abundance in human productivity by allowing the flow of work capacity
from people with surplus to people with deficit.

I hope to produce this new "dual currency" model for digitally
produced goods and services fairly soon and then a P2P app for trading
"cpu hour" and "man hour" can be built based on that, or at least the
spec for it can be developed.

Need to attend to my other project, but will check back here as often as I can.

hope this is helpful

Marc

On Mon, Feb 16, 2009 at 5:44 PM, marc fawzi <marc.fawzi at gmail.com> wrote:
> ~~
>
> Digitally produced goods and services exist in a world of their own
> that can be thought of as separate from our physical world in that
> it's almost infinitely more efficient.
>
> For example, building a house in Second Life takes dramatically less
> in work energy than building a house in the physical world and the gap
> makes the difference between abundance now and abundance in 200 years.
>
> A house built in the physical world using a high degree of automation,
> e.g. with robots and open architectural plans can be sold at the cost
> of work energy it takes to build it (assuming it's made from renewable
> materials and its production process meets the conditions for
> sustainable abundance) but when will we have such high physical
> production efficiency?
>
> There is a lot that needs to happen in terms of dramatically
> increasing production efficiencies for physical goods _before_ we need
> an economy to sustain and enhance the abundance.
>
> When it comes to digitally produced goods and services, we can start
> with an example of why a new kind of economy and currency is needed.
>
> If I can get 10 "cpu hours" a day from my PC, i.e. 10 X (1 gigaflops
> processor running for 1 hour, as assessed by the Linpack benchmark
> Rmax), and if it costs me less than 0.2 "man hour" a day on average to
> maintain my PC (general PC maintenance) then I have 10 cpu hours and
> e.g. 7.8 man hours a day (based on an 8 hour work day) to produce some
> digital goods (e.g. open source music, open CAD designs, open Second
> Life models, or open software etc) and if I invest in faster and/or
> more efficient PC I will have more CPU hours and/or more man hours to
> make more digital goods.
>
> So given that I'm limited in my resources it's not sustainable for me
> to give away the digital goods I produce or exchange them in
> expectation of a potential return (in other digital goods) that may or
> may not happen or that may happen only partially with a net loss to
> myself.  If I don't get any return (in cpu hours or man hours or both)
> I can not produce more digital goods, so my production will be limited
> and that cannot lead to abundance.
>
> I can sell both surplus cpu hours and surplus man hours I have in
> return for cpu-hour tokens and man-hour tokens and I can also lend and
> borrow both cpu-hour tokens and man-hour tokens. I can also invest
> more man-hour tokens, i.e. hire someone with the tokens, or invest my
> own man hours, and cpu-hour tokens, i.e. use someone else' machine (or
> my own PC's cpu hours) to create more efficient production processes
> for my digitally produced goods and services so that I get back more
> than I put in when exchanging those digitally produced goods and
> services for cpu hour tokens and man hour tokens. That's the only
> profit that can be made and it drives the whole economy toward higher
> and higher efficiency, i.e. otherwise, i get back roughly the same as
> I put in in cpu hours and man hours.
>
> ~~
>
> This model synopsis below is far less ambitious but far more effective
> than the P2P Energy Economy that I've been working on. While it taught
> me a lot as far as the principles of a sustainable economy, the P2P
> Energy Economy, in attempting to apply itself to the physical world
> outside of the computer, was aiming at a future when we have physical
> abundance in essential resources.
>
> For now, it seems that the only abundance we have is in computational
> power and our own creative energy.
>
> A lot of the ideas from the P2P Energy Economy are directly applicable
> and will be reused but the model will become far less complex as it
> changes trajectories from aiming to reinvent the world decades or
> centuries ahead of the world naturally getting there (see prior
> comment on the current "efficiency gap" between the digital world and
> the physical world) to aiming at fixing the inequitable exchange model
> for digitally produced goods and services.
>
> One key difference between this model and the P2P Energy Economy
> (besides the absence of smartgrid) is the existence of two currencies:
> the cpu-hour token and the man-hour token. Like machine money and
> human money.
>
> Neither type of currency is meant to enable ownership. Both are meant
> to enable production, not ownership.
>
> So, I'll take the P2P Energy Model apart and compress it/remold it
> into this new model that can be applied today to give us a sustainable
> abundance economy in digitally produced goods and services.
>
> Marc
>