Jump to content

Primary: Sky Slate Blackcurrant Watermelon Strawberry Orange Banana Apple Emerald Chocolate Marble
Secondary: Sky Slate Blackcurrant Watermelon Strawberry Orange Banana Apple Emerald Chocolate Marble
Pattern: Blank Waves Squares Notes Sharp Wood Rockface Leather Honey Vertical Triangles
Photo

The Economics of Maoyuu


  • Please log in to reply
34 replies to this topic

#1
Pax Empyrean

Pax Empyrean

    Potato

  • Members
  • 123 posts
So, this series needed a topic dedicated to the economics at work here. I was quite impressed with how it was handled earlier on; it would have been easy for the author to just say that war created demand which led to prosperity, which is a commonly held (and wrong) belief. Instead he explained that the transition from infighting among neighboring countries to a united front against the demons led to trade and the sharing of technology, which led to prosperity. Little touches like that really set this story apart.

However, the quality of economics went downhill in chapter 16. The assumption that they can fix prices on potatoes while simultaneously avoiding surpluses or shortages is not believable unless they manage to guess the market clearing price, which they really could only do be blind luck and it would likely not even be an improvement over just leaving the price of potatoes alone to be discovered by the market. If they're worried about declining confidence in the currency, temporarily abandoning that currency in government use is like throwing gasoline on a fire. People would rush to try to unload their money even faster, and be less willing to accept payment in those same coins. It would just make the problem worse.

It's also suggested that someone in Central might be trying to corner the market in wheat and then sell it at a profit. This seems plausible to a lot of people, which is why it has been attempted so many in actual history. The problem is, it doesn't work. Commodity markets are basically impossible to corner, and it always ends in the ruin of anyone who tries it. Higher commodity prices simply encourage more production in the long run and less consumption in the short run.

They were having problems with border security already, and now they're imposing an export tariff (tariffs are typically on imports in real life) that will cause the number of smugglers to increase dramatically. Sneaking grain out of the country will simply enrich and empower those who are not inclined to follow the law. Hopefully this is just less-knowledgeable characters screwing up when the Demon Queen isn't around to show them how it's done, instead of the author suggesting that all of this stuff is a good idea. She seemed a lot more sensible than this, and I never saw bad policies like this when she was the one making the suggestions.

Anyway, if any of you have any questions about economics or things brought up in this story, I'd be happy to answer them. Economics is my area of expertise, and we'd all be better off if more people understood it better.

#2
ZeKeR

ZeKeR

    Potato Spud

  • Members
  • 49 posts
  • LocationSomewhere in the Philippines
I think I saw you at MF too, Emp.

isn't the potato a major stock even in IRL back then? and what about the currency exchange rates (should there be there)? well if I still remember a bit of the economics subject I got last 2 years ago, the tariffs SHOULD stabilize the whole wad problem but the question is how heavy will it be and what smuggling would get them. and isn't it within hoarding if someone's rapidly depleting wheat (btw during the old times, just how much was the trade off for such products like a single sack of wheat, barley, flour? I read somewhere that the ancient Romans typically shilled gold and silver that can fill up a small clay pot for about 20-30 of those things since they were the top trade, inb4 the spice trade which I don't know how much you could buy for 2-3 gold coins) and any other produce for themselves?

this is one of the weird problems within medieval economy, as I believe back then it was still a problem for most that some nobles resorted to infighting to keep their backs off the inflation.

and isnt the Merchant Union similar to a central hub of stock exchange?

sorry, economics isn't my strong point but it caught my interest.

also, the title "what can you do with a single piece of gold" has a LOT of branches, some leading to bad fruit....

Edited by ZeKeR, 21 August 2012 - 11:05 AM.


#3
Purple Library Guy

Purple Library Guy

    Fried Potato

  • Donator
  • 695 posts
  • LocationCheck Rivendell, or Vorbarr Sultana, or Adrilankha. No? Try Vancouver.
I wouldn't say "economics" is my strong point. But I might say "political economy" is a strong point of mine. So Pax, if you don't mind my asking, your strong point is economics, but what brand? Are you a "Washington Consensus" "Free Trade/Free Markets" economics person, or a Keynesian, or a weird Austrian booster, or a Marxist, or a "Modern Monetary Theory" booster, or what?

#4
kimagure

kimagure

    Potato Sprout

  • Members
  • 8 posts
Good points, but I think I'd disagree with your conclusions about Union cornering the wheat market. I think it might actually work. Commodity markets are very difficult/impossible to corner in normal conditions, but the world of Maoyuu isn't one of normal economic conditions. Higher commodity prices encourage more production, but that requires there to be underproduction in the system. The Maoyuu world is one at war, in which it's been established that hunger and famine occur frequently. Moreover, Union seems to have a trade monopoly, and while there may be small, independent merchants (which we have yet to see), they likely don't have enough influence to greatly affect the overall economy. When production is maximized, then monopolization of a key commodity will simply result in higher prices and inflation or hyperinflation unless control measures are put in place. One good example of this is the US during WWII, in which maximum steel prices were fixed by the government in order to prevent inflation.

It's also important to note that wheat, unlike steel or most commodities, is a necessity. It's been established to be the staple food of this world, and unlike most normal commodities like tea or sugar, it's not something that you can really cut back on without replacement from another staple crop.

In the short term, this would generate huge profits for Union and a great deal of popular unrest and likely famine. The nobles don't really care and are planning on squeezing it out of the peasants, but you can only squeeze so much in taxes. In the long term, this would lead to one or more of three things: 1) diversification in food supply,2) overproduction of the land (which may increase short-term yields but will lead to overuse of the land and decreased fertility as happened in North Korea), and 3) popular unrest/rebellion (think of France around the time of Louis XVI and "let them eat cake"),

Although you might think that diversification would prevent Union from cornering the wheat market, that's not exactly true. The two other staple crops presented so far are corn and potatoes. Potatoes have been declare heresy by the Central church (though that'll give way in the face of famine) and Union has full control over the corn market (see chapter 6).

While tariffs will increase smuggling, it will also spur the reverse: increased immigration to the Southern lands (which is something that they're trying to promote). The goal of the tariff isn't to stop all export of wheat, it's to reduce it, and it will have that effect. Because the tariff is only on wheat, however, it will also encourage the export of other staple goods like potatoes. Especially since smuggling has its own associated costs (such as the need for alternate transport not using the main roads or wagons with hidden compartments, etc. The question is whether the tariff is so punitive as to make widescale smuggling worthwhile. If it isn't, then the Southern kingdoms will still export food, but get a healthy profit off of it, all the while furthering their goals of increased immigration and the spread of their new ideas.

That spread of ideas/knowledge is as harmful for the Central countries' invasion plans as internal unrest would be. Since it's hard to motivate your army to fight against heretics, when such heretical knowledge (potatoes) are the staple food keeping their families from starvation.

Or would you disagree?

Also, I didn't get the impression that they were abandoning the currency, just more trying to provide wage stability by paying through a staple commodity instead. And while it's true that that may add uncertainty to people's use of money, I'd expect it to add economic security to the nation, especially in the face of hyperinflation. The currency is likely Central's, not the Southern Kingdoms', and currency is a sign of a nation's prosperity. If a nation's currency is weak, that shows that the nation itself is weak. In a way, this is another means by which the Southern Kingdoms' would be detaching themselves from Central's control, as they would be less dependent on their currency. One follow-up move might be for Southern to issue its own currency.

Since wheat and food are staple crops, then people may trade excess wheat for gold, but there'd be little incentive for that if hyperinflation's occurring and peoples' faith in the currency is shaken.

I really don't have anything about the fixed price on potatoes though. That could be an option if the Southern nations were in control of the currency, but they're not. China manages to keep its currency pegged to the US dollar by doing that kind of thing, but they also are fully in control of the currency. Other nations that have tried to do the same during times of inflation, were also fully in control of their currency and only permitted certain people to convert their money at full-market rates (I think I'm thinking of Zimbabwe), which didn't solve the problem and which led to a great deal of corruption. Maybe it'd work to promote potatoes if they have a hugely excess supply of them?

I mean, the knowledge that you can exchange 3 coins for a quarter bag of wheat or 3 bags of potatoes (hypothetically) will do a lot to remove people's inhibitions about eating a heretical food if there's famine...

#5
Ditzuha

Ditzuha

    Potato Sprout

  • Members
  • 4 posts
  • LocationPhilippine Summer Highlands
If I may.

Young Merchant is using the current economic situation in Central to rise to power. I guess he is more of the "I can effect more change if I'm on top" people. Taking advantage of opportunities to bring yourself closer to a goal is the sort of thing he would do.

The Noble's motivation for his planned attacking or harassing of the Southern kingdoms can range from punishment for hurt pride (this has been many the cause of a war, more so than people usually perceive), distraction of the populace from domestic problems or personal ambition.

The Finance Minister's proposals on inflation control work, provided that they could could ensure that smuggled goods do not wreck the market setup.

As to tariffs, these are more of a protectionist measure. Not to stop exports, but to slow them and to encourage immigration to the South (one of their goals). As of now, the Open Market approach is favored by countries who see other countries as a dumping ground for their goods (to control supply at home).

Central's standing can be explained as: They have benefited the most from the status quo. Any change to the status quo is a threat to their benefits (regardless if it means that other countries will have an improving standard of life) and thus must be dealt with using any means necessary. The medieval Church declaring people heretics and then confiscating their considerable properties has been done so many times in the past.

#6
Pax Empyrean

Pax Empyrean

    Potato

  • Members
  • 123 posts
Ok, Purple Library Guy's question goes first, since that might help frame future responses better.

I'm very much a free trade and free markets type. While I acknowledge that markets are not perfect in practice or in theory, I have so little faith in government to intervene wisely that giving them the power to much about with the economy at all is almost certainly going to make things worse. Politicians act according to political incentives, and good politics lines up with good economics about once-a-never. I like the Austrian explanation of business cycles (increases in the money supply affect interest rates which allow for less sound investments, which implode), but their methodology rejects empiricism outright and strikes me as too limiting to give a good understanding of what is currently happening in the economy. I also believe that a person's preferences have an underlying cardinal utility function, which is a minor heresy among Austrians, who believe in ordinal utility only. So, I think the Austrians have come up with a few key insights, but I wouldn't call myself one.

In response to ZeKer:

isn't the potato a major stock even in IRL back then?

The potato wasn't introduced to Europe until the 1560s. It was a pretty big deal, and came less than a hundred years after the introduction of four-field crop rotation. The increased productivity of agriculture allowed for a greater degree of urbanization than was previously possible. Usage varied, and it took a couple hundred years to catch on in some places.

well if I still remember a bit of the economics subject I got last 2 years ago, the tariffs SHOULD stabilize the whole wad problem but the question is how heavy will it be and what smuggling would get them.

This is kind of a weird case. Most tariffs are imposed on imports rather than exports, and historically they were a major source of revenue (the US government was financed by tariffs, and didn't even have an income tax before the Civil War). Modern tariffs are mostly used to discourage cheap imports and help local industry at the expense of local consumers who have to pay higher prices for local goods instead of the imported stuff; they're a political move before they're a method of raising revenue. In the story, they're using tariffs to discourage exports rather than try to raise revenue. As for what smuggling will get them, it's basically just the difference between the price of wheat in the southern kingdoms vs the central kingdoms. If they follow the tariff, it would be the difference between the price of wheat minus the amount of the tariff. If the tariff is higher than the difference in the price of wheat, it would eliminate profits from legal trade entirely, making smuggling the only option. The main problem I foresee with this is that they were already having problems with upholding the law around the border. If they can't stop people from robbing and killing each other along the main roads, they certainly won't have the manpower to watch the whole border and inspect every wagon and pack animal that crosses over.

(btw during the old times, just how much was the trade off for such products like a single sack of wheat, barley, flour? I read somewhere that the ancient Romans typically shilled gold and silver that can fill up a small clay pot for about 20-30 of those things since they were the top trade, inb4 the spice trade which I don't know how much you could buy for 2-3 gold coins) and any other produce for themselves?

Presumably, prices varied according to time and place. I couldn't tell you what they were, though.

this is one of the weird problems within medieval economy, as I believe back then it was still a problem for most that some nobles resorted to infighting to keep their backs off the inflation.

Inflation wasn't really a problem most of the time, and when it showed up it was heavily tied to changes in the money supply or debasement of the currency itself. Debasement of the currency was a hallmark of a regime in trouble, such as the Romans in the third century. Take a look at the debasement of the Antoninianus, a Roman silver coin: http://upload.wikimedia.org/wikipedia/commons/1/1b/Decline_of_the_antoninianus.jpg

I also mentioned changes in the money supply. Today, we run a fiat monetary system, where we can just print new money out of the blue and throw it into the economy via central banks using open market operations. Before this, changes in the money supply meant changes in the availability of gold and silver. These changes were actually very small compared to modern inflation. The biggest period of inflation in Europe before the advent of fiat currency was from the 15th to 17th centuries, which had a large increase in silver mining in Europe and the discovery, conquest, looting, and mining of the New World. Over a period of about a hundred and fifty years, prices increased to about six times their previous level. For comparison, since the Federal Reserve was created almost a hundred years ago, prices have increased to about 23 times the previous level. Inflation back then was practically nonexistent compared to what we see under modern monetary systems.

and isnt the Merchant Union similar to a central hub of stock exchange?

Not really. A stock exchange is for the trade of financial instruments that don't seem to exist yet in the world of Maoyuu. About as close as we've seen so far is Young Merchant giving what amounts to a loan in exchange for future payment in wheat. While this isn't the same as a futures contract (where payment is deferred), it serves the same purpose for Young Merchant, who is anticipating an increase in the price of wheat and uses this method to make profits on it. He's playing a risky game though, since financing somebody's war tends to make them angry with you when it comes time to collect. This particular situation caused a lot of hostility toward Jewish moneylenders in the middle ages, who played a role in financing the Crusades and other military expeditions. So long as it's more convenient for the borrower to pay back the debt instead of have him killed, he should be alright, but it's something to keep in mind.

In response to kimagure:

Good points, but I think I'd disagree with your conclusions about Union cornering the wheat market. I think it might actually work. Commodity markets are very difficult/impossible to corner in normal conditions, but the world of Maoyuu isn't one of normal economic conditions. Higher commodity prices encourage more production, but that requires there to be underproduction in the system. The Maoyuu world is one at war, in which it's been established that hunger and famine occur frequently. Moreover, Union seems to have a trade monopoly, and while there may be small, independent merchants (which we have yet to see), they likely don't have enough influence to greatly affect the overall economy.

Hunger, famine, and war are common occurrences throughout history. Even so, nobody managed to corner a the market for a basic commodity like wheat. As for underproduction, there are two responses to this. First, there are a lot of people doing things aside from farming in the world of Maoyuu, but agriculture is handled under a largely feudal system in a lot of places, and while this is changing, it does make the system less quick to adjust on the basis of things like famine. Complaints about suddenly fluctuating wheat prices imply that the price of wheat itself might have been sticky in the past. To me, that says an adjustment in wheat production could have taken place, but was delayed by both institutional factors and social norms.

When production is maximized, then monopolization of a key commodity will simply result in higher prices and inflation or hyperinflation unless control measures are put in place. One good example of this is the US during WWII, in which maximum steel prices were fixed by the government in order to prevent inflation.

The US was running a command economy during WW2, with heavy rationing along with all the price fixing, as well as daily begging of people to not raise prices on the things that weren't being rationed or controlled directly. In any case, government actions taken in anticipation of some feared future occurrence are not evidence that the event would have come to pass if not for their precautions. It's plausible that reduced consumption of steel would have followed naturally from the increasing steel prices due to government demand, even without rationing. The government financed practically all of this through war bonds anyway.

It's also important to note that wheat, unlike steel or most commodities, is a necessity. It's been established to be the staple food of this world, and unlike most normal commodities like tea or sugar, it's not something that you can really cut back on without replacement from another staple crop.

The world of Maoyuu has recently had major developments in agriculture, with the introduction of the potato (which Central isn't using), corn (which they are using), and the four field crop rotation system. While the southern kingdoms were at one point dependent upon Central for their food supply, this is no longer the case. Trying to cut off that supply by manipulating the price of wheat is playing a game of chicken that Central just isn't going to win. It's possible that Young Merchant knows this, and is orchestrating all of this to weaken the Central kingdoms (and make a fortune on loans to be repaid in wheat in the future) while still being able to claim that that he was merely trying to help Central in their efforts against the southern kingdoms. It's also possible that he's trying to get people to switch from wheat to corn and potatoes, In any case, there are other staple crop replacements that have been introduced, and it hasn't been long enough for population pressure to catch up to the new agricultural output. Even with Union controlling corn production, they still want to make as much money as they can, which means selling it. I think the concerns about wheat prices are being overstated.

While tariffs will increase smuggling, it will also spur the reverse: increased immigration to the Southern lands (which is something that they're trying to promote). The goal of the tariff isn't to stop all export of wheat, it's to reduce it, and it will have that effect. Because the tariff is only on wheat, however, it will also encourage the export of other staple goods like potatoes. Especially since smuggling has its own associated costs (such as the need for alternate transport not using the main roads or wagons with hidden compartments, etc.

Immigration would only be spurred to the extent that the tariff is effective in reducing exports. I don't factor potato exports into this since in Central potatoes are EXTRA HERETICAL. The costs of smuggling are just a measure of how difficult it is to get away with it, and when there isn't even enough government presence to keep people from robbing and killing each other on the main roads, the difficulty in avoiding a checkpoint is probably pretty minimal.

The question is whether the tariff is so punitive as to make widescale smuggling worthwhile. If it isn't, then the Southern kingdoms will still export food, but get a healthy profit off of it, all the while furthering their goals of increased immigration and the spread of their new ideas.

They aren't imposing the tariff to try to raise revenue, they're doing it to try to stop exports.

That spread of ideas/knowledge is as harmful for the Central countries' invasion plans as internal unrest would be. Since it's hard to motivate your army to fight against heretics, when such heretical knowledge (potatoes) are the staple food keeping their families from starvation.

They aren't eating potatoes in Central, even though it's legal to export them in the southern kingdoms, they're still heretical in the Central kingdoms.

Also, I didn't get the impression that they were abandoning the currency, just more trying to provide wage stability by paying through a staple commodity instead. And while it's true that that may add uncertainty to people's use of money, I'd expect it to add economic security to the nation, especially in the face of hyperinflation.

There's no indication that they're doing this, and really not much point in it. They want to establish a set price for potatoes by buying them from farmers and selling them to consumers in town at the same price (I guess transporting them around at a loss, but whatever) but there's really no reason for them to stop paying government salaries with the currency. You don't fix doubts about the value of a currency by suspending the use of that currency in an official capacity. That is absolutely the worst thing they could be doing to deal with that situation.

The currency is likely Central's, not the Southern Kingdoms', and currency is a sign of a nation's prosperity. If a nation's currency is weak, that shows that the nation itself is weak. In a way, this is another means by which the Southern Kingdoms' would be detaching themselves from Central's control, as they would be less dependent on their currency. One follow-up move might be for Southern to issue its own currency.

They said they would stop using it temporarily. Presumably that figures into the plan to fix the price of potatoes, somehow, but it isn't explained how that's supposed to work. Issuing their own currency wouldn't matter much; it's just gold, and they're already trading heavily with the Central kingdoms anyway. It's not like they need to establish their own currency for the sake of running some new monetary policy scheme. I suspect that Maou is the only one who even knows what monetary policy is, much less how to use it to accomplish some national agenda.

I mean, the knowledge that you can exchange 3 coins for a quarter bag of wheat or 3 bags of potatoes (hypothetically) will do a lot to remove people's inhibitions about eating a heretical food if there's famine...

The people in the southern kingdoms don't care that potatoes have been declared heretical. Their national hero is a heretic.

In response to Ditzuha:

As to tariffs, these are more of a protectionist measure. Not to stop exports, but to slow them and to encourage immigration to the South (one of their goals). As of now, the Open Market approach is favored by countries who see other countries as a dumping ground for their goods (to control supply at home).

That's rather the opposite of protectionism. Protectionism imposes tariffs on imports, not exports. The effect is the opposite of what they're trying to accomplish in the southern kingdoms.

I need to come up with responses more quickly, since people keep posting before I finish and that just makes the whole thing longer. :)

#7
alethiophile

alethiophile

    Potato Sprout

  • Donator
  • 2 posts
I should note that the usual objections to governmental interference in markets aren't going to fully apply here; they're under a monarchy, and the monarchs seem generally to be decent and intelligent people. Moreover, most of them are probably going to be listening to Maou, who's smart. So you don't (so much) need to worry about the usual failure mode of such things, which is elected politicians enacting the measures in a spirit of "something must be done" in order to court votes, and no analysis of their actual efficacy ever being done. To put it another way, the motives of Maou + various kings are not tainted in the way the motives of elected politicians are today.

#8
Graeystone

Graeystone

    Potato

  • Members
  • 141 posts
  • LocationNW PA
Purple Library Buy - I'm a Free Market/Capitalist. Things like the Trade Union in the manga, Crony Capitalism(what that Noble just did), and Monopolies go against my grain.

The biggest threat to what Demon Queen is doing will eventually come from the Trade Union. They are nothing but a glorified monopoly that has their fingers in everything. On top of that their loyalties are fickle. If the economic situation in Central becomes greater than the South, the backing the South gets from the Union will go back to Central. Worst of all those who run monopolies, whether privatly owned or owned by the government, will fight tooth and nail if threatened with being broken up into smaller parts or facing competition(which leads to Crony Capitalism on their part). Now the South doesn't have the resources or clought to break up the monopoly that is the Trade Union.
Then that leaves creation of businesses held by citizens to directly compete with the Trade Union. That's going to be a bigger mess than what is currently going on.

kimagure - The problems with revolts is that whatever takes over the current government more times than not ends up being worse than the previous form of government. A little known piece of US History - When creating the new government after the War of Independence, someone suggested that the leader's title(president) be 'King'. Yeah, people suggested a title from the very system they fought against.

alethiophile - The thing of it is, while the Winter King and his fellow monarchs agree with Demon Queen on economic issues, form of government is another matter. If she ever proposes a government system like what the US Founding Fathers created, she would be sent packing. While the Southern Monarchs are trying to the right thing economic wise, they are still guilty of a couple of things often found monarchies like an insane rate of illiteracy in terms of reading, spelling, and word comprehension. The fact that Big Sis Maid was able to understand her early lessons is a miracle in itself. . .or just Plot Armor on her part.

Posted Image

Power without Love leads to tyranny. Love without Power to protect will fade.

The only absolute thing about absolute techniques is that sooner or later somebody absolutely breaks them.

There are no fan-boys. Just an-girls who don't need a bra and their plumbing is on the outside.


#9
alethiophile

alethiophile

    Potato Sprout

  • Donator
  • 2 posts
Sure, the Council of Southern Monarchs or whatever they're calling themselves aren't going to react well to proposing removing themselves from power. Those in power never do. The point is they're not under the same conditions as modern democratic politicians which might lead them to ignore available good economic advice in favor of what's immediately politically expedient, and being close to Maou they're hopefully not going to screw things up out of plain ignorance either.

I personally tend to think you'd get much better government out of a monarchy (or other autocracy) with a trustworthy monarch than just about anything else; the problem is that the damage a corrupt monarch can do under such a system is immense, and there's no reliable way of making sure that monarchs are trustworthy.

#10
ZeKeR

ZeKeR

    Potato Spud

  • Members
  • 49 posts
  • LocationSomewhere in the Philippines
whats probably more meaning is that all the while internal power struggles and dickery on the nobles' part, the working class gets hammered to hell.

also, didn't they say that the southern lands are still untouched? if my brain still wrings out important bits, then it could happen like back then IRL, most, if not all of the farms' goods are directed to government (I believe that is what Central is doing for a long time since they have the seat of the Church) that leaves the working people nothing as the nobles are sucking most of the country's supply.

another thing I'd like to know is the speed of growth and harvest. what the land and the farms are probably gonna face right now is the massive influx of immigrants settling in, which I believe will slowly... err... "de-fertilize" the land, causing slower harvests and possibly the threat of shortage.

still, the Union looks like they're unaffected by this rapid WTF spreading in the lands, and I'm not sure if the other two Kingdoms will start to feel the WTF in their borders too.

as for the additional border patrol guards, stabilizing their wad issues is the priority unless that newly appointed minister of finance knows how to juggle gold between their central seat to the rural areas in their country, since I think recruiting more men will soon be a warning sign for the finance department already wracking their brains at this eventual WTF with a staple crop.

#11
kimagure

kimagure

    Potato Sprout

  • Members
  • 8 posts

In response to kimagure:

Hunger, famine, and war are common occurrences throughout history. Even so, nobody managed to corner a the market for a basic commodity like wheat. As for underproduction, there are two responses to this. First, there are a lot of people doing things aside from farming in the world of Maoyuu, but agriculture is handled under a largely feudal system in a lot of places, and while this is changing, it does make the system less quick to adjust on the basis of things like famine. Complaints about suddenly fluctuating wheat prices imply that the price of wheat itself might have been sticky in the past. To me, that says an adjustment in wheat production could have taken place, but was delayed by both institutional factors and social norms.


The US was running a command economy during WW2, with heavy rationing along with all the price fixing, as well as daily begging of people to not raise prices on the things that weren't being rationed or controlled directly. In any case, government actions taken in anticipation of some feared future occurrence are not evidence that the event would have come to pass if not for their precautions. It's plausible that reduced consumption of steel would have followed naturally from the increasing steel prices due to government demand, even without rationing. The government financed practically all of this through war bonds anyway.


The world of Maoyuu has recently had major developments in agriculture, with the introduction of the potato (which Central isn't using), corn (which they are using), and the four field crop rotation system. While the southern kingdoms were at one point dependent upon Central for their food supply, this is no longer the case. Trying to cut off that supply by manipulating the price of wheat is playing a game of chicken that Central just isn't going to win. It's possible that Young Merchant knows this, and is orchestrating all of this to weaken the Central kingdoms (and make a fortune on loans to be repaid in wheat in the future) while still being able to claim that that he was merely trying to help Central in their efforts against the southern kingdoms. It's also possible that he's trying to get people to switch from wheat to corn and potatoes, In any case, there are other staple crop replacements that have been introduced, and it hasn't been long enough for population pressure to catch up to the new agricultural output. Even with Union controlling corn production, they still want to make as much money as they can, which means selling it. I think the concerns about wheat prices are being overstated.


Immigration would only be spurred to the extent that the tariff is effective in reducing exports. I don't factor potato exports into this since in Central potatoes are EXTRA HERETICAL. The costs of smuggling are just a measure of how difficult it is to get away with it, and when there isn't even enough government presence to keep people from robbing and killing each other on the main roads, the difficulty in avoiding a checkpoint is probably pretty minimal.


They aren't imposing the tariff to try to raise revenue, they're doing it to try to stop exports.


They aren't eating potatoes in Central, even though it's legal to export them in the southern kingdoms, they're still heretical in the Central kingdoms.


There's no indication that they're doing this, and really not much point in it. They want to establish a set price for potatoes by buying them from farmers and selling them to consumers in town at the same price (I guess transporting them around at a loss, but whatever) but there's really no reason for them to stop paying government salaries with the currency. You don't fix doubts about the value of a currency by suspending the use of that currency in an official capacity. That is absolutely the worst thing they could be doing to deal with that situation.


They said they would stop using it temporarily. Presumably that figures into the plan to fix the price of potatoes, somehow, but it isn't explained how that's supposed to work. Issuing their own currency wouldn't matter much; it's just gold, and they're already trading heavily with the Central kingdoms anyway. It's not like they need to establish their own currency for the sake of running some new monetary policy scheme. I suspect that Maou is the only one who even knows what monetary policy is, much less how to use it to accomplish some national agenda.


The people in the southern kingdoms don't care that potatoes have been declared heretical. Their national hero is a heretic.


I don't think I made my main point very clearly, so let me apologize on that. My main argument was that Union and Young Merchant could have some very good reasons for their actions. Namely, that they benefit by encouraging the citizens and kingdoms of Central to diversify their food supply since potatoes are considered heretical and the only other available staple crop is corn (which they fully monopolize). The nobles of Central are getting hosed and they don't know it.

This is not to mention the fact that Young Noble has a soft spot in his heart for Crimson Scholar, if only because her ideas and innovations have been and are likely to continue being highly profitable for him (including corn, the compass, potatoes, etc...). He doesn't even need to corner the wheat market for long. Eventually, supply would catch up in one way or another, through a shift to potatoes or Crimson Scholar's 4-stage crop rotation. The point isn't to fully control the wheat market, it's to drive consumer and economic behavior to areas that are more profitable for him and Union.

Young Noble will make a killing in the first year or two after monopolizing the wheat market. After that, he can simply walk away and sell corn while the second-comers will be hit when the wheat market collapses. It'd basically be like what Goldman Sachs did during the housing bubble: get out before the market collapses.

Given the greed and stupidity of the nobles, the information lag of a medieval society, and the fact that greater food diversification would have lowered the price of wheat to begin with, this is a very elegant way of executing a sophisticated economic scam on a lot of the top nobles. I wouldn't be surprised if Young Merchant subsequently resold the wheat contracts and more to nobles who think that they'll make a killing on rising wheat prices. If Young Merchant times it right (and given that greedy nobles are unlikely to tell others of their plans to buy up wheat) and given the lack of a central information hub like a stock exchange, Young Merchant should end up with a ton of gold and quite a few nobles should end up financially ruined.

As a bonus, he'll have gotten more wide-spread adoption of corn (and quite likely a few more corn development colonies as described in chapter 6).

#12
Purple Library Guy

Purple Library Guy

    Fried Potato

  • Donator
  • 695 posts
  • LocationCheck Rivendell, or Vorbarr Sultana, or Adrilankha. No? Try Vancouver.
One thing we should maybe remember (and I'm not actually sure to what extent the mangaka has internalized this, although there certainly seems to be some awareness of it) is that the economy of feudal societies is not capitalist and not market-based and indeed generally not even really currency-based. There are merchants and there are markets, but they do not dominate; there is some capitalist production, but even for made goods sold by merchants that arrangement does not dominate, and some exchange based on coin but . . .
Rather, much exchange is in kind (making the proposal to pay the guards and such in wheat for a while far less radical than it would be today), most manufactured production is by independent artisans often organised into craft guilds rather than by employees working for owner/employers, and most wealth and power are based on landholding and taxing, in kind, the agricultural production of peasants, who form the vast majority of the population and who do very little of their business using money.
Now granted, the situation on this world seems to be late feudalism, with a merchant class rising and the use of money spreading, and, apparently, decadent nobles who imagine that real money is shiny gems rather than the fruits of their land. But even so, we can't apply the rules of modern economies to the situation and expect everything to work. That noble chuckling to himself that there is in any case no reason he should pay back some worthless merchant if the deal doesn't work out for him--for hundreds of years nobles did that kind of thing, and they got away with it too. There are some who date the rise of England's power to a point in the Renaissance when the king of England ran up huge debts with an Italian moneylending family and then defaulted, leaving England rich and the moneylenders holding the bag. And there was nothing much the merchants could do--they say the pen is mightier than the sword, but it ain't necessarily so. In a feudal economy merchants and markets and trade were often useful but they were not the foundation, so you could punt them around and get away with it.
In another way, that makes me think that cornering markets might be more practicable than it seems. The other thing about an economy with markets but not dominated by markets is simply that the market segment of it is relatively small. It is probably impossible to "corner the wheat market" in the sense of getting your hands on all the wheat produced, or even close, because most of it is not for sale in the first place. But it may be possible to "corner the wheat market" in the sense of getting a very dominant share of all the wheat actually on the market, precisely because that isn't so much. Also if you're driving the high prices you may be able to get your hands on wheat that wouldn't normally be for sale just because those holding it smell an opportunity.
I'm not actually convinced young merchant is trying to corner the supply as such. I mean, cornering the supply implies that once you have done so you will sit there on the supply and hold everyone to ransom, maintaining unnaturally high monopoly prices, otherwise there's no point. Which might work from a strictly economic point of view, but politically it's a problem. Such action depends on a legal and regulatory framework that considers property rights based on purchase to be of higher social importance than any consequences. This isn't a society like that. Basically, he'd have to hold still being the monopolist for some time, and the kings would have him executed rather than let him fleece them that bad. No, this strikes me as more of a pump-and-dump scheme. It's similar, but not identical. My suspicion is he's trying to build up the price of wheat in a frenzy, like tulips and dotcom, while locking in some cheaper sources of supply for himself (e.g. by introducing futures, like with that merchant) so that he can sell at the top of the market and laugh at everyone when the price crashes again. Such a strategy leaves him much more of a moving target--he can quickly unload on "greater fools", turn a huge profit and get out.

Another thing about the not-a-market-economy point is that the strategy of our heroes is in part something that wouldn't work or even occur to people in a modern economy: They are basically responding to a market gone nuts by temporarily reverting to the older economy and limiting their exposure to the market, period. I think it's a reasonable response given the economy they're working with, especially since it would be reasonable to expect more frontier kingdoms like theirs to have less exposure to markets in the first place.

--------------------------------------
I'll make with my own broad position to match Pax Empyrean. Even in a modern context I'm not a free marketer, or even close to. Descriptively I'd be closer to a Keynesian, prescriptively some kind of social anarchist. That is, I believe that we have a capitalist and market economy today but that this is not some kind of cosmic eternal condition and there are options that would be superior (and also options that would be worse). Things like supply and demand are real forces but not definitions of an optimum state. They're things that policy needs to take into account, but not in order to defer to them, rather to know what you're trying to manipulate. Private actors manipulate supply and demand all the time (that's what's happening in the manga right now), and there's no basic reason governments should avoid doing so. Same goes for competition and so on.

Even given an economy of the general shape we have, there are a host of good reasons for state intervention. The nonstate economy seriously undersupplies public goods due to free-rider effects; there is no known way around the free-rider effect other than taxation. There are a number of key goods and services which have the characteristics of "natural monopolies"; for such things competition loses far more efficiency than it can gain due to things like duplication of infrastructure. If a monopoly is to exist, it needs to be controllable by the people either directly (popular ownership via the state) or indirectly (through strong regulation) to avoid monopoly rents. Private for-profit firms increase their profits through the use of externalities wherever possible, and the scope of this tactic is huge; only government regulation can block this imposition of bads on the population and work force. Markets are in any case created and maintained through the imposition of rules by some social means, usually a government, which thus cannot possibly "leave them alone".

It's my belief that neoclassical, roughly Walrasian economics is amazingly bogus; if one looks at the basis of efficient market theory, the number and scope of the counterfactual assumptions you have to take on board for markets to "clear" is mind boggling. In my opinion, the major reason this economic strand has a good deal of currency and power to shape policy is not that it stacks up well as a theory but that it is useful politically to powerful groups, that it results in advocacy of policies which are convenient to the very wealthy, such as deregulation, opposition to redistribution of wealth and so forth.

(Incidentally, a technical point widely overlooked--"capitalist" and "market" are not the same; you can have a market economy without capitalists and you can have an economy with capitalists but without markets. Capitalists are private owners of the means of production, people who invest capital to gain a return; they can make money from that without selling in a competitive market; examples include the US military contracting industry. Meanwhile worker-owned co-operatives can sell things in markets; if such co-operatives dominated they would constitute a market, but not capitalist, economy. Sounds like a nitpick, but the point is one can criticize capital without being against markets and criticize markets without being against capital; I criticize both but I'm definitely against capital while only being wary of markets)

So there you go--Pax and I are probably pretty far apart on a lot of our beliefs about the economics of all this. But the clash may be reduced given that, as I say, both our assumptions have to be modified since the economy here should be quite different from today's.

Edited by Purple Library Guy, 22 August 2012 - 11:06 PM.


#13
Pax Empyrean

Pax Empyrean

    Potato

  • Members
  • 123 posts

Now granted, the situation on this world seems to be late feudalism, with a merchant class rising and the use of money spreading, and, apparently, decadent nobles who imagine that real money is shiny gems rather than the fruits of their land. But even so, we can't apply the rules of modern economies to the situation and expect everything to work. That noble chuckling to himself that there is in any case no reason he should pay back some worthless merchant if the deal doesn't work out for him--for hundreds of years nobles did that kind of thing, and they got away with it too. There are some who date the rise of England's power to a point in the Renaissance when the king of England ran up huge debts with an Italian moneylending family and then defaulted, leaving England rich and the moneylenders holding the bag. And there was nothing much the merchants could do--they say the pen is mightier than the sword, but it ain't necessarily so. In a feudal economy merchants and markets and trade were often useful but they were not the foundation, so you could punt them around and get away with it.

The balance of power here has been explicitly stated that Union is not to be messed with. Maou called them the most powerful enemy. Trying to have an individual member (albeit a very important one) assassinated is risky, but just defaulting outright wouldn't be as easy as it was historically.

Even given an economy of the general shape we have, there are a host of good reasons for state intervention. The nonstate economy seriously undersupplies public goods due to free-rider effects; there is no known way around the free-rider effect other than taxation.

The counterargument here being that many public goods are not something that many (or most people) people would willingly pay for even if those goods were excludable. Furthermore, some public goods only remain public goods rather than club goods by virtue of being the sole domain of government, so nobody bothers to find a way to make them excludable. As a result, these goods will be tremendously oversupplied if political incentives are in place for government to do this. For instance, the United States military accounts for 41% of global military expenditures. The next biggest spenders are China, at 8.2%, and Russia, at 4.1%. Estimates of total military expenditures vary; those are just from Wikipedia's list compiled by the Stockholm International Peace Research Institute; you might find something more accurate at the CIA World Factbook, but I think the difference is big enough that the point stands even if those numbers are not exact.

There are a number of key goods and services which have the characteristics of "natural monopolies"; for such things competition loses far more efficiency than it can gain due to things like duplication of infrastructure. If a monopoly is to exist, it needs to be controllable by the people either directly (popular ownership via the state) or indirectly (through strong regulation) to avoid monopoly rents.

The people are absolutely clueless, and regulated industries are subject to regulatory capture. Either regulation is imposed by people who have no idea what they are doing, or it is imposed by people who are knowledgeable from working in the regulated industry itself. There is also the matter of private firms offering jobs to officials who treat them favorably. The SEC has been notorious for this: http://blogs.reuters.com/alison-frankel/2012/08/07/new-study-says-sec-revolving-door-not-important-dont-believe-it/

Private for-profit firms increase their profits through the use of externalities wherever possible, and the scope of this tactic is huge; only government regulation can block this imposition of bads on the population and work force.

Negative externalities are either actionable in civil courts, impossible to quantify, evidence of poorly defined property rights, or irrelevant. In cases where the harm inflicted is identifiable, it's better to handle these things through civil courts. In cases where the harm inflicted is merely speculative, it's just throwing darts with eyes closed to get the taxes or fees right (and you'll never know if you hit the target anyway). Aside from that, trying to correct for negative externalities through taxes (and most economists outside of the adherents of Ronald Coase seem to favor pigouvian taxes for this) is still a miscarriage of justice. Suppose you impose $500 worth of negative externalities upon me, and the government fines you $500 to compensate for this. I'm still screwed to the tune of $500, and not only that, the government is now reliant upon you continuing to screw me in the future to ensure it maintains its revenue. That sucks. Some negative externalities are simply irrelevant; a lot of people who made their living breeding or caring for horses (or working in fields related to maintaining a primary equestrian transport system) were put out of work by the advent of inexpensive, mass produced automobiles. That's a big negative externality, but it's also just tough shit for them, and I don't see anyone seriously suggesting that Ford should have had to pay to have these people retrained in some other field just because the Model-T cost them their jobs.

Markets are in any case created and maintained through the imposition of rules by some social means, usually a government, which thus cannot possibly "leave them alone".

Markets arise spontaneously according to social norms, which are not the same things as laws. Trade predates trade laws. Black markets exist among illegal goods. Kids in elementary school swap sack lunches. Markets arise spontaneously any time people have different estimates of what something is worth, and the government has absolutely nothing to do with that.

I'm not actually convinced young merchant is trying to corner the supply as such. I mean, cornering the supply implies that once you have done so you will sit there on the supply and hold everyone to ransom, maintaining unnaturally high monopoly prices, otherwise there's no point.

Cornering a market doesn't necessarily mean you'll hold that position for a long time. I think this is mostly just a semantic disagreement; I think you've got a viable theory that he could just be doing this for a short run fluctuation where he tries to trigger some sort of speculative bubble, ride that up a bit, and jump off before it crashes.

Which might work from a strictly economic point of view, but politically it's a problem. Such action depends on a legal and regulatory framework that considers property rights based on purchase to be of higher social importance than any consequences. This isn't a society like that.

It doesn't need to be a society like that, though. All it needs is for him to be in a position where various members of the nobility are afraid to go after him directly. He's one of the leaders of Union. Union has a lot of power. Possibly enough to choke out a country that tries to play hardball with them. That's what is important here, not their willingness to abide by some deeply-held respect for property rights.

It's my belief that neoclassical, roughly Walrasian economics is amazingly bogus; if one looks at the basis of efficient market theory, the number and scope of the counterfactual assumptions you have to take on board for markets to "clear" is mind boggling.

All you need for a market to clear is for firms to adjust either prices or quantity supplied in response to how much of a product is being sold. It doesn't require perfect information, it doesn't require us to all turn into homo economicus when we go shopping or go to work, and it doesn't require firms to have zero market power. I see people rejecting basic explanations of how markets work because of old simplifications of how markets work and the first thing that comes to mind is someone proclaiming that physics is bullshit because the real world isn't a frictionless vacuum.

In my opinion, the major reason this economic strand has a good deal of currency and power to shape policy is not that it stacks up well as a theory but that it is useful politically to powerful groups, that it results in advocacy of policies which are convenient to the very wealthy, such as deregulation, opposition to redistribution of wealth and so forth.

And I think that Keynesian thought has the influence that it does because Keynesian economists tell politicians that they need to spend more money whenever they suspect the economy is below potential output. As for the attitude of the very wealthy toward deregulation, I think you're simplifying things. They want regulation that is favorable to them. They want protection from competition. The last thing they want is free for all cutthroat free markets where they'd have to maintain their position by actually being better at what they do instead of just lining the campaign coffers of politicians and offering cushy jobs to regulators.

Meanwhile worker-owned co-operatives can sell things in markets; if such co-operatives dominated they would constitute a market, but not capitalist, economy.

A worker-owned coop is simply a situation where everyone owns capital; where everyone is a capitalist. Just because there's no clear distinction between the bourgeoisie and the proletariat doesn't mean they aren't capitalists any more. Heck, anyone who has a 401k probably has money tied up in stocks, which makes them capitalists too.

#14
ZeKeR

ZeKeR

    Potato Spud

  • Members
  • 49 posts
  • LocationSomewhere in the Philippines
so this means that the Young Merchant is playing a very risky game by riding a burning cart and jumping off when it reaches the great end? and isn't he just simply (sorry for being quite literal or most) redirecting/funneling the various flows into a single channel?

I'm not quite sure what the medieval market holds, but I'd want to list a few guys I'd usually see or read in a typical medieval market....

smithies - they're not included in the system, right? they're private sector until the government, or should I say, the keep hires them as their commissioned workers, right?
cash (or was it cash back then?) exchange depots - I dunno the full extent of what it usually brings to a medieval economy (sorry guys, still can't understand well but am quite interested in it) but I did read some outdated books (that was dated in 1994) that there were times that people were butthurt about the rate of 1 small diamond the size of a baby's hand = 370 silver or 510 gold or that weird moment where 3 crystal pearl necklaces = 1/2 silver ingot or 2 gold ingot
produce sellers - I dunno, but my mind is still mixed if the keep will go to the market and buy from them, have them commissioned for the entire city (is it possible?) or something.

I believe these guys were part of the massive market districts in a city.

also, didn't someone on their side suggested to weigh the import with a large sum?

#15
Purple Library Guy

Purple Library Guy

    Fried Potato

  • Donator
  • 695 posts
  • LocationCheck Rivendell, or Vorbarr Sultana, or Adrilankha. No? Try Vancouver.
Pax Empyrean: Well, we have some idea where each other stands now. Rather than push this thread totally off the manga, I think I'd rather just say that I've seen arguments like yours before and I do not find them persuasive; no doubt you would find my counterarguments likewise unpersuasive. We could probably have a fun time arguing them back and forth but it would be never-ending and way off track.

On the manga itself, it is quite possible I'm underestimating the political/economic clout of Union and the degree to which the society has already moved away from a feudal base.

ZeKeR -- Lots of stuff is private sector. In many ways feudal economies were fairly "small government". The total tax level was distinctly smaller as a percentage than it is now (although the church IMO complicates that since it was in effect part of government, both in the sense that it maintained extensive manorial holdings as a feudal lord in its own right, and in the sense that it taxed the public--tithing--and used the money to maintain social programs, prosecute wars, give the rulers bling and so on). But what is meant by "private sector" wasn't really the same as it is now for the most part. For one thing at least 90% of the population was rural; cities were a place where surplus got concentrated, but they didn't dominate the economy the way they do now. And the farmers who made up the majority of the population not only didn't gain much of their livelihood through buying and selling, particularly for money, they tended to actively avoid doing so where practical. Normally the goal of European peasants was to maximize self-sufficiency rather than to raise cash crops and then trade for needed goods. Until around the 18th century (depending on the country), even the nobility were not greatly interested in money as such. While they could and did sell some of the products they collected in taxes, or produced by peasants paying tax in the form of labour, for the most part they just used it to maintain large households, particularly armed men but also many who produced luxury goods for their consumption. Status was more measured by the number of people a noble maintained than by wealth measured in money. This began to shift shortly before Adam Smith's day. So anyway, a city blacksmith would be charging coin for his services, but it's very likely a country/small town blacksmith would be mostly paid in wheat, chickens or whatever. Escalation of the money price of wheat would have little effect on such arrangements.

Even in cities, it's hard for modern people to wrap their heads around just what a craft guild was, how it operated, and how important it was. During the high medieval period (which admittedly the society in this manga seems a bit past) they were unequivocally more powerful and important than merchants. In Renaissance Florence, an alliance of craft guilds literally took over the rulership of the city on more than one occasion. Craft guilds monopolized production in their craft; outsiders couldn't practice whatever it was. They regulated prices, regulated quality, regulated the size of a loaf of bread, often successfully banned imports, controlled trade secrets. In renaissance Venice, at the height of Venice's mercantile power, the government and the glassblowers' guild worked together to outlaw any guild member leaving the city to practice elsewhere, let alone sharing Venetian glassmaking secrets (As a side note, the huge and successful Venetian merchant fleets were government owned, although the cargos were not). So a city blacksmith if operating according to historical European norms would not be allowed to set his own prices, set up in business at all without the consent of the guild, or deviate too far from the guild's standards of workmanship; meanwhile it's very likely people like Young Merchant would not be allowed to, say, import cheap horseshoes and undersell the blacksmith; his prices would be guaranteed. An older, prosperous blacksmith with some apprentices who got along well with the other blacksmiths would eventually become one of the guildmasters and have a hand in setting those prices and standards. The guild would collectively viciously resist anyone who tried to interfere with their monopoly; such as it was, they kind of formed what middle class medieval times had and they were dead set against being reduced to serfs . . . or, later, employees. I would expect that in a situation where prices were suddenly rising, the guild masters would get together and bump the prices for their goods, which wouldn't help with the inflation situation. I suppose a feudal lord might be able to lean on them to moderate their price shifts, for a while, if he could persuade them that he had some way to keep the wheat prices from getting out of hand. I'm not at this point sure whether the mangaka is aware of craft guilds or sees them as interesting or powerful. To some extent this manga is a huge parable of some sort about the nature of economics, technology, progress and so forth, and it may be that he's deliberately abstracting away things like the influence of the guilds because they'd clutter up the message.

Edited by Purple Library Guy, 23 August 2012 - 08:32 PM.


#16
ZeKeR

ZeKeR

    Potato Spud

  • Members
  • 49 posts
  • LocationSomewhere in the Philippines
@Purple: so there are differences in the typical things you'd usually see in the market like the hardworking smith in his workshop? I'm not too sure about craft guilds but they flourish where areas that are perfect hubs for works. to clear up, the feudal system at typical is that the people are... err... "enslaved" to a crown, right? As for Renaissance Italy, most city-states (I dunno much but Lorenzo Medici was said to have made Florence flourish like mad and turned it into a major hub for markets that lead to other villages/towns/cities) typically have a small grade markets, but that era they didn't have a centralized hub for trade (pretty sure Venice and Rome were the major trade hubs and craft guild HQ's), did they?

as for the rigidity of the craft guilds, isn't it usually like a council or a table-like seminar formation of master craftsmen? and I assume that a craft guild was quite decentralized.

I thought that the rural smith would charge coin at most, but that could be a possibility then.

#17
Purple Library Guy

Purple Library Guy

    Fried Potato

  • Donator
  • 695 posts
  • LocationCheck Rivendell, or Vorbarr Sultana, or Adrilankha. No? Try Vancouver.
The feudal system is not that simple; it varied depending where you were, but saying that the people were "enslaved" to a crown is about as accurate as modern Libertarians saying citizens are "enslaved" to a nation-state. Which is to say, not very.
First of all, ordinary people had no real relationship to the crown at all. They owed their fealty to a local landed knight maybe. He owed fealty to some bigger lord, like a baron. The baron in turn might owe fealty to a duke. And the duke would owe fealty to a king. Which sounds like the peasant in the end is loyal to the king, but the point is if the baron switched allegiance to someone else, the knights went with the baron and the peasants went with the knights, so they could quite readily switch what country they "belonged" to if their local lord did. Plus it was a serious limitation on the powers of kings; they did have some direct landholdings and men-at-arms of their own, but often less than some of the powerful dukes had. It gave powerful nobles considerable independence of action and it was not unusual for dukes to defy royal decrees and even end up actually fighting wars with their kings--not trying to replace the king, just one powerful noble fighting another.
The second thing is that fealty was a complicated relationship. For some serfs in some countries it did come quite close to slavery, for others it didn't really. England is known for strong common law traditions that gave farmers some rights, France not so much. Serfs were like slaves in that they had to stay put and weren't allowed to piss off and go do something else--although if they did manage it for a certain length of time there were often amnesties. But they were unlike slaves in that the land they worked was, sort of, theirs and they had the right to most of what they produced on it. So you're a lord, you got this serf on this plot of land. You're the lord of this land so it's sort of yours; but it's also sort of his. You can tax him, you can stop him from leaving, you can make him do a day a week working on your own personal land, but unlike with a slave it would be universally agreed to be dirty pool if you take his land away and give it to someone else; his dad and granddad and great-granddad farmed that land and he expects to pass it to his sons and grandsons (whether they want it or not). Screwing with that was a good way to get a peasants' revolt. And, he's farming that land himself and the produce of it starts out as his. You tax it, but still if he produces more he keeps more, and he can do what he wants with the stuff he keeps--it's his. Plus, you owe that serf certain things; you have a responsibility to protect them from bandits, invaders or whatnot and are typically expected to provide some relief in times of famine or other disasters.
Note that one day a week though. This is one of the bases of the manorial system--the lord would have a stretch of personal land, his manor, not occupied by peasants. All the serfs owed a certain portion of their labour to work the lord's land, and the lord kept everything produced there. That definitely helped make the boss rich.
Fealty at the higher levels was a lot more even in the rights and responsibilities, and a lot more subject to people lower down walking away or swapping allegiance if they weren't happy.

The craft guilds--yeah, they were run by a council of master craftsmen as a rule. But the thing is, most craftsmen in the guild weren't considered "masters". It was an oligarchy by old dudes (almost always dudes, although occasionally a widow woman could make it in) with connections. To move up from "Journeyman" to "Master" tended to take more than just having good chops at the craft. You usually had to be decent at going along to get along, although probably they'd let someone move up if everyone acknowledged they were spectacular. They were decentralized in the sense of being different in different cities. But in a given city they were generally a pretty tough "closed shop". They controlled who got in and how many. In an informal sort of way, they kept an eye on supply and demand, making sure they didn't end up with so many in the guild that they would be overproducing, the better to control quality and keep prices fairly high. In short, if you came into a city with skills as a brewer, you couldn't just drop by the guildhall and say "what are the dues?", pay them, and go into business claiming to be a journeyman brewer. They'd smash your shop. If they didn't think there should be any more brewers in town right now, you would not be going into business as a brewer, period. And normally, if they did think there should be another brewer in town, the person who would get the spot would be an apprentice ready to move up to journeyman status who had some local backing. Apprentices would be sponsored in from pretty young, and get room, board, hard work and training and not much else, but they'd have a chance to move up. And hey, no student debt after graduation.
In practice it seems like things were a bit messier than I've described and people did manage to get away with stuff sometimes, but that's the basic setup.

#18
Graeystone

Graeystone

    Potato

  • Members
  • 141 posts
  • LocationNW PA
Just look at any metropolis(Chicago, New York City) in the US and you have your modern Fiefdom. Bloomburg is getting really bad in trying dictate people's lives in New York City-
http://www.nypost.com/p/news/local/mayor_knows_breast_WqU1iYRQvwbEkDuvn0vb1H

Posted Image

Power without Love leads to tyranny. Love without Power to protect will fade.

The only absolute thing about absolute techniques is that sooner or later somebody absolutely breaks them.

There are no fan-boys. Just an-girls who don't need a bra and their plumbing is on the outside.


#19
Purple Library Guy

Purple Library Guy

    Fried Potato

  • Donator
  • 695 posts
  • LocationCheck Rivendell, or Vorbarr Sultana, or Adrilankha. No? Try Vancouver.
I as a rule seriously dislike Bloomburg, but that seems like a very sound policy to me.
I actually find it quite a surprise that billionaire Bloomburg is backing the public health against formula-selling corporations' efforts to get hospitals to boost their profits.

#20
thddragon85

thddragon85

    Potato Sprout

  • Members
  • 5 posts
My two cents: all these points are very interesting, but probably not the point of what the author is trying to do.

I think the author had a very specific goal in mind, and that goal was accomplished in spades.
My belief is that the author is simply trying to introduce economics in a way that is easily consumable and readily remembered.
A good way to think about it is the way the southern kingdoms used the bards as the way to spread their message.

These days when people think economics, they don't think free markets vs x y or z.
They think big heavy books, lots of egg heads with big heavy glasses, and long boring lectures that are something along the lines of I'm hearing English but not really understanding anything because either the lecture is being delivered by some TA with a think accent or I'm just stupid, probably both.

By putting economics 101 into a form that has comedy and big boobs (male audience), mixed in with a little drama and romance (female audience), at the very least, a wide range of readers will have a basic understanding of the vocabulary of economics that so many of us forget after our finals. If we (people of modern society) are lucky, some might take an interest in economics and participate in discussions like this one.

By no means am I saying this discussion is overrated or shouldn't take place, since getting discussions like this one started is a major part of what the author is trying to accomplish (again, in my opinion).
I would just like to keep the author bashing from starting/getting out of hand.

Edited by thddragon85, 09 September 2012 - 09:14 AM.