Tuesday, December 8, 2009

Survival of the cheapest?

The "survival of the cheapest" culture.

"Value" seems to be a key word in today's societies. Yet, I argue that "value" is a term without any "real" meaning, at the end of the day. I am even prepared to argue that the notion of "value" is misleading in today's market systems.

I propose that the concepts "I deserve" or "what is my value" have no face .. value in the market.

Cost, utility and price are terms which have more applicability. They are more "real" in market terms. What is more, these terms go well beyond economics. Supply and demand, cost, utility and price are not necessarily measured in money. After all, money is but a measurement tool.

It's about give and take, transactions, exchanges. It's about supply and demand, economic or "non-economic".

And price is after all, as I learned in my college economics courses, the point of equilibrium between supply and demand.

My thinking is not economic, it is interdisciplinary. After all, I have had some training in economics, but I am not an economist.

Utility is also a relative term. What is for example is the utility of a match in a desert island? For a non-smoker, for a smoker? A smoker who has cigarettes nut no matches or a smoker who possesses neither matches or cigarettes?

What is "quality"?

To me, "quality" means standardisation. I.e giving the same every time, with minimum variation.

Machines offer quality. Humans offer "value"

There lies the strategic problem for humans in today's "Globalia".

If humans have a competitive advantage in producing "value", and "value" is an irrelevant term, then where is the bottom line?

With more and more manufactured goods being produced in China and services offered remotely from India, what will Americans and Europeans produce in the future (assuming that globalisation and free trade do not fall to pieces)? How many services, even offered locally, cannot be based on survival of the cheapest?

Maybe our future lies in relocating to China where cost of living is much lower!

I propose that the competitive advantage of the USA and Europe (OECD countries) lies, for a while at least, in capitalising on the relative and volatile utility of intangibles.

The competitive advantage of the human factor (vis-a-vis capital and machines) lies in producing goods and services with high intangible added-utility (e.g. branding).

I also argue that humans, after all, are at their best not in repetitive, but non-repetitive, creative, intellectual, based "products".

When you play not to lose, you play more conservative football (or soccer, if you prefer)!

Humans will beat the machines by capitalising on what makes them human.

Let us assume that in the future, robots and other machines produce most products and services. Humans will then have a lot of time on their hands. But what about money?

Will we all get paid for being poets, painters, singers and doing other ultra-human activities?


Living with "too many" options?

Freedom of choice and availability of many options does requires a "philosophised" person, ie a person who knows what he/she wants and does not want and has developed a personal philosophy on life, as well as not being lazy in using his/her brain. no matter what the IQ is.

I can thus see how some people and daters may prefer totalitarianism, monopolies as well as not like the benefits of online dating, for them and for others!!!!

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BRs
Nick

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